Insurance

Asked by Anonymous

Updated on 18 Apr 2019

What are some alternatives for better returns to endowment plans (that is liquid) to park $200 every month?

My insurance agent suggested an endowment plan by Great Eastern called Flexi Cashback, where you can receive yearly payouts (or keep them in for compound interest) in case you need the cash. So I will get about $84,000 back in 25 years if don't touch the money at all based on 4.75% interest. If I put in $200 every month, where are some other alternatives to park that cash that gives better returns/liquidity?

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A diversified portfolio via a Robo or a FA would do just fine. Fully liquid, low cost, you don't have to manage it, fuss free, and auto rebalancing every quarter to keep you within your initial risk allocation.

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Jonathan Chia Guangrong
Jonathan Chia Guangrong, Fund Manager at JCG Fund
Level 6. Master
Answered on 12 Dec 2018

Assuming you have a mid to high mid risk tolerance, a s-reit with a strong sponsor like ascendas or fraser or mapletree. Maybank ke has a monthly investment programme that allows you to giro a minimum of $100 a month into a chosen stock selected from a list. Quite comprehensive. Fees are 1+% for each transaction which is relatively low. Over time the dividend payout should potentially surpass what any endowment can give you. You can also go with blue chip stocks if that's more of your cup of tea. Hope this helps

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Lok Yang Teng
Lok Yang Teng,
Level 6. Master
Answered on 11 Dec 2018

If you got higher risk tolerance, you could go for small cap stocks with good PB values to dividend yield ratios.

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