What are your thoughts on Singapore Life's 3% Endowment Plan which offers guaranteed returns over 3 years for deposits between $1k - $6k? As opposed to SSB and FD? High opportunity cost/low returns? - Seedly
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Gabriel

Asked on 27 Nov 2018

What are your thoughts on Singapore Life's 3% Endowment Plan which offers guaranteed returns over 3 years for deposits between $1k - $6k? As opposed to SSB and FD? High opportunity cost/low returns?

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Kenneth Lou
Kenneth Lou, Co-founder at Seedly
Level 9. God of Wisdom
Answered on 28 Nov 2018

Haha behind the scenes, we actually met Singapore Life before to learn about their company. They are actually one of the most heavily funded Financial 'startups' here in this region and claim to be launching new products to the newer generation of users.

Much like another company which we know as FWD.

On the regulatory front, they check all the boxes... have the relevant licences and also have in fact the financial muscle to have bought over all of ZURICH's Life insurer's customers. So on a risk front, these are mitigated. Plus also, you are looking at a time frame of 3 years, so that is actually a smaller risk to take on, versus like a 100 year whole life plan.

Do take note however! Singapore Life Credit Rating: BBB

Standard & Poor’s “BBB” (long-term local currency issuer credit rating and insurer financial strength rating in January 2018). Singapore Life Pte. Ltd. is committed to offering a full suite of innovative and digitally executed insurance and financial solutions to customers to fulfill their protection, savings and investment needs.

Compared to AIA for exampe who has a credit rating of: AA- under the same Standard & Poor's rating agency :) Important point to consider.

It would also seem that many of these smaller insurers are using endowments as a way to buff up their coffers... Much like FWD, Etiqa and now Singapore Life.

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Jonathan Chia Guangrong
Jonathan Chia Guangrong, Fund Manager at JCG Fund
Level 9. God of Wisdom
Updated on 07 Jun 2019

This will be suitable for those who are very risk adverse. Personally I won't touch it as returns don't make sense for me.

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Gabriel
Gabriel

27 Nov 2018

Same thoughts here!
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Dwivid Sharma
Dwivid Sharma
Level 5. Genius
Updated on 07 Jun 2019

Hi Gabriel,

I am not sure that people want to invest in endowment plans especialy in Singapore, where 17 years old boy/girl have good knowledge of stocks investment.

People in Singapore are more active toward financial planing as compare other countries. They know that how to make money with low risk of capital in short term period.

Don't you think that 3 percent of return is very less for 3 years investment.

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Gabriel
Gabriel

27 Nov 2018

Yup, totally agree with you especially on the last point! I have no plans to purchase endowment plans, just gathering thoughts haha
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Yixiong Chang
Yixiong Chang
Level 7. Grand Master
Updated on 07 Jun 2019

sounds good!

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Gabriel
Gabriel

27 Nov 2018

Personally, I feel that it is more suitable for people with lesser excess cash and/or who are more conservative (low risk) since the 3% only applies for deposits up to $6k.
Yixiong Chang
Yixiong Chang

27 Nov 2018

even the Temasek retail bond is only paying 2.7% for 5years. Technically, it (3%) should be viewed as higher risk (not lower risk). =D
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