Tan Kin Lian's Blog: Growth Policy

Friday, March 07, 2008

Growth Policy

Dear Mr Tan,
Should I invest in the NTUC growth policy using my CPF special account?

REPLY
CPF special account pays interest of 4% plus 1% bonus. It does not have any risk. The Growth policy gives a return of 3% to 4% (not guaranteed) and has to be invested for 10 years or more. It is better to keep your money in the CPF special account.

7 comments:

Anonymous said...: Today i invested $10K into the combined fund at the business centre.
I was told that the agents are instructed to go all out to beat the CPF deadline to sell the endowment Growth Plan. As you can see ,Mr. Tan has said it is not a good plan but a losing plan because it cannot give what it is projected and it is risky. If you should need money before the maturity you will lose money. With CPF, the 4%+1% is quaranteed and will be given no matter when you wish to withdraw.
So do not be enticed into investing in this product no matter what the greedy agents will tell you. The agents will be working very becuase they stand to get 2% commission if sell Growth even other single plans are better than this. Be careful of the conflict of interest.; March 07, 2008 2:07 PM
Anonymous said...: It is sad to see insurance companies doing such thing using their agents by providing them enough incentive to snatch what should be in the CPF out of the clients' hands. This is a bad and unethical practice. In other words companies care for the sales and bottom line and don't care whether the product is good for the clients. And the drooling agents are just as eager and use whatever means to rob the clients of their retirement fund. No wonder not many can retire with enough funds with their funds being churned around by insurance agents.
MAS must stop this activity if it really cares about the people's
well being.; March 07, 2008 8:06 PM
Anonymous said...: There is no complete disclosure in this case. Customer is unable to decide whether to leave with CPF or to invest in Growth if he hasn't enough information. Even he has, agent must give his or her opinion according to the client's financial circumstances to help him.In the first place this product should not have been recommended to the cleint to avoid conflict of interest or mis-selling.
This is advice.
I hope MAS will make it the onus of all agents this responsibility.; March 08, 2008 1:14 PM
Anonymous said...: This is blatant downright cheating if the agent got away with it. Thanks to your presence of mind that you consult this blog before making a decision.
It is alarming that insurance agents today are employing
underhand means to make a living and at the expense of the cleint often is someone trusting and who looks to the agent for help. Instead he or she is being betrayed without even knowing it.; March 09, 2008 2:49 PM
Anonymous said...: You should ask the agent how much commission he or she gets.The agent is obliged to tell you. This is part of disclosure.
Currently ntuc agents are going all out to beat the CPF 1st. April deadline. Beware! they may use unethical means and lies and misrepresentation to get you to invest.Remember that it is not to your benefit or gain to use CPF balance,OA or SA to invest in Growth Policy.It is a losing investment. There a lot of odds against you, low return, long lock in, high risk of not getting 4%, loss due to inflation etc etc.
Buyer beware!!!; March 09, 2008 4:59 PM
Anonymous said...: An agent at the business centre said me the agents are pushing very hard to get you to buy Growth. If you are buying funds they will try to persuade to switch to growth becasue they get extra commission. There is a promotion for this product now.
They will tyell you that funds are risky now so don't buy funds but buy growth.; March 10, 2008 4:43 PM
Anonymous said...: No wonder at a ntuc mrt roadshoe an agent was trying to promote to me growth. Ask me whether i have cpf. I told her i wanted high return but she advised me not to invest in unit trust but the growth policy with guaranteed return of 4% .; March 10, 2008 6:49 PM