Someone said that Axa promoted "Buy Term and invest the difference".
When you invest in the Axa fund, you should select the single premium option, where the charges are quite modest.
If you select the regular premium option, you will have to incur a high distribution cost, which may not be disclosed to you by the agent. This was the experience of my friend, who was being offered a regular premium ILP at a roadshow.
For a comparison of the distribution cost, read this webpage:
http://www.askdrmoney.com/Ins_ILP_RP.htm
The distribution charge of 19 months under the AXA regular premium plan is quite high.
Axa's regular ILP is actually a flexible product to let you DIY to mimic the traditional whole life and endowment products.Many companies have this product. The distribution cost is as high as the traditional products. Commission paid to agents is high as 100% plus,eg Prudential pays 50%,25%,25% for 3 years to their agents.
ReplyDeleteIf you are looking to invest regularly maybe NTUC ID7. Of course ,it is the not the best.There are available regular plans which charge 3% for every amount you invest only.
At the end of the day it is the adviser or salesman that you get that makes or breaks your investment.
No one company offers the best.You may have to source from a number of companies. If you require an adviser to help, look for FA companies. The advantage of FA model is that they can look for the best for you. They are not tied to promote a particular company's good or bad products, there fore manipulation of the sales process is reduced.
ReplyDeleteRegardless a tied agent or IFA, there are good ones and bad ones. An unethical IFA may recommend a plan with higher commission to his customer.
ReplyDeleteEither investment thru IFA or Insurance company, there will be charges except that the charges comes in different form.
Unless you read, learn and DIY yourself, then you can save some money.
Everything being equal, don't you think that FA is more advantageous?
ReplyDeleteHonesty and competence are the foundation of good advice, without either one everything can go wrong.
FAA defines a fit and proper adviser is one who is HONEST AND COMPETENT.
Not sincere or caring, or loving; in fact they can be very disastrous. If you get an adviser who tells you she is sincere you better run as fast as possible. You will be ruined.
There is no need for you to think too much.
ReplyDeleteWhen you talk about ILP, you look at 2 things.
1) Allocation Rate
(The higher the allocation rate, the better it is. You are making your money work harder for you)
2) Charges Involved
(No point earn big profits, if hefty charges eats up your profit)
I will just post the industry's allocation rate for ILP and you decide. :)
If you want to know more,visit my blog.
Refer below ,
1) NTUC
Allocation :Yr 1 – 3---85%
Yr 4 100%
2)AIA
Allocation ---100%
Surrender penalty (backend charge)–
Yr 1 – 95%
Yr 2 – 85%
Yr 3 – 65%
Yr 4 – 40%
Yr 5 – 30%
Yr 6 – 25%
Yr 7 – 15%
Yr 8 – 0%
3) Prudential
Allocation
Yr 1 20%
Yr 2-3 50%
Yr 4-9 100%
Yr 10 105%
4) GE
Allocation:
Yr 1 15%
Yr 2 50%
Yr 3 75%
Yr 4 – 9 100%
Yr 10 105%
5) Manulife
Allocation :
Yr 1 0%
Yr 2 – 3 50%
Yr 4 – 10 100%
Yr 11 102%
Thank you :)
Helmi Hakim
http://www.helmihakim.com
Helmi, how come you don't post the charges for ID7? Scared that customers don't buy ID2 which pays hefty and huge commission to you salesmen? This is conflict of interest. ID7 and ID2 are products of NTUC Income.Your duty is to recommend the best of products from own company for your clients. If ID7 is better for your clients you should recommend it to them or is it because it deprives you of commission? Are you "planning" for yourself or for the clients?
ReplyDeleteYou should have the decency to disclose the charges for ID7 too if you are ethical and truly for the client instead of pretending you are doing them a service by disclosing the competitors' charges to your advantage. Is it not a sham or shame what you are doing? Come on, if you are an truly an adviser and not a salesman, you should be thinking and putting your clients' interest first. This is the least you can do. This is hypocrite . Any way readers can see through your ruse.
Zhumeng,
ReplyDeleteThere are no competititors in the industry.
We are all co-workers helping clients plan to meet their financial objectives.
We have done our job well, as long we plan and enable them to achieve their financial objectives in life.
My mode of comparison is ......
apple with apple.
Pear and pear.
Durian and durian.
and I will only promote what I am conversant and what I am able to.
I have lots of clients and you can ask any of them, when I promote a financial product, I will disclose everything on charges.
and they are willing because they like my service, they love my candid attitude, they love me for being transparent and definitely look me not only as a qualified financial associate but also as a long life friend and partner.
This is what we call mutual benefit :)
Mr. helmi Hakim, how much you know about your own product, ILP, ID2?
ReplyDeleteI don't think you know enough to make comparison. You are NOT comparing apple for apple.
Did you know the others' regular ILPs are products that allow you to mimic the traditional products? Did you know that these products can be designed or shaped to look like your endowment and whole life products? Does ID2 have this flexibility? Did you know how much they get for their commission? They are 50%, 25%, 25%. A real RIP OFF!!
No difference from revosave, also another rip off product. Did you disclose your commission you get from selling revosave or ID2 to your cleints? No difference from them.Did you know that you have to disclose to comply with FAA?
You too have skeletons in your closet.
I don't think your customers can ever achieve financial independence in your hand. You said that you are not conversant with the other products.Does it mean that you are only conversant with products with high commission, like revosave or products of your choice? Did you know the NTUC endowment gives MUCH MUCH better coverAGE AND RETURN THAN REVOSAVE? wHY THEN REVOSAVE? How do you help your clients when you have INADEQUATE knowledge of your products? Helmi, clients are in danger of wrong advice in your hand.
ReplyDelete