Saturday, July 25, 2015

SG50 Guaranteed Saver Policy

Here is my analysis of the SG50 Guaranteed Saver Policy from Great Eastern Life.
It is okay, but there are catches!


Anonymous said...

Why is MAS allowing this insurer to mislead the public.

Concerned citizen said...

Aunties and uncle or for that matter, those who are scared of risk it is better for them to buy the Singapore Saving Bond comes this September than to buy those stupid endowment products by insurance companies.
Why SSB better than endowments?
The reasons are
(1) there is NO lock in risk unlike the endowments which have penalties if you decide to terminate before maturity.
(2) there is NO cost or commission to pay to agents to eat away the return.
(3) the return is superior than endowment compared tenor to tenor.
(4) THE ONLY COMMONALITY IS THE REAL RETURNS OF BOTH PRODUCTS ARE negative in the short term but in the long term these bonds' return can overcome or equal inflation...
I hope the public would wake up to these facts when buying saving products. The long term average rate of inflation is 4%.
Which insurance company's endowment product currently returns 4% over 10 years?...the answer is NONE!!!!!!!!all loses to inflation, all less than 2.5% . So are you really saving for the future? No... you are regressing to the past.Your "saving" is losing its purchasing power even before you started saving.
For your own sake , go look for an HONEST and Competent adviser who will put your interest FIRST. Tied insurance salesmen CANNOT even if they want.Remember you are saving for the LONG term for retirement and don't let salesmen screw up your retirement....remember,the long term rate of inflation is 4%

Anonymous said...

It should be more correct to call this product,
"SG50 Guaranteed losing Plan". Isn't it true?. The return every year is losing 2% to inflation. Why is inflation not disclosed by agent? How can customers make informed decision without this information?
This is fair dealing to customer outcome which is expected of every insurer.But alas, insurers and their agents don't disclose so that they can trap customers into buying.

Kin Lian Tan said...

Reply to 11:09 PM
The return is at least better than the interest rate paid by the banks. If inflation is at 2%, this product will maintain its value vs inflation.

Anonymous said...

Mr. Tan, the average inflation rate is 3.5 to 4%. Therefore this supposedly 2% guaranteed product guarantees to lose 2% to inflation every year.
Making comparison to the FD rate is illegal (MAS) because it misleads public especially the aunties and housewives and the financially unsavvy folks into belieivng that a product is 'good' so long it is better than the FD.
FD is no benchmark.

Anonymous said...

Some people are just financially not well educated. By the same token, even SSB is a "losing" product. The benchmark is always "what is the best next alternative". FD is a fair comparison here as it is low risk and available to all retail investors. In this low interest rate environment, it is just difficult for financial institutions to provide guarantees of high rates. It is okay if you hate insurance products, but no need to mislead others when you yourself are not well versed in finance.

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