Buy a low cost product

Hi Mr Tan,

Why do you advocate "buy term and invest the difference" and, at the same time, advise people to buy life insurance products? Are you contradicting yourself?

--------------------

REPLY:

There are two separate markets:

1. Those who are financially savvy can "buy term and invest the difference". They know how to select the right fund that have low cost.

2. For most ordinary people, they will find it more convenient to invest in a endowment or whole life policy. I advise them to buy a low cost policy (ie with a low margin for commission), rather than a high cost policy.

Lesson: Buy a low cost product.