Dear Mr Tan,
I chanced upon your blog and saw many posts related to insurance. I was approached recently by an insurance agent promoting me a ILP. I am only 20 this year, awaiting for ns and university.
I understand that you urge young people to not get ILP so early due to the effective returns calculated in the future after deducting the premium allocation. It would be more economical to get a savings plan and a life time term plan for illness or death coverage.
Although it is a good practice to cultivate a habit of saving. Is it even necessary for me to get a ILP in the future? I may have more financial knowledge when I grow older and may be able to manage my own basket of investments. Will an ILP be required when I grow older?
My objective of an insurance at this stage will be to save for about 10years to create a substantial amount of savings for future investment use when I grow older. My second objective will be to cover a plan for death or critical illness or disability as I'm about to enlist soon.
REPLY
It is better for you to invest in an ETF, rather than an ILP. REad this article
http://tankinlian.com/FramePDF.aspx?ID=643
2 comments:
Avoid wholelife , endwoment or any insurance claiming as saving plans and regular ILPs....they are NOT saving plans, they are rubbish plans, not even in the future.
1. For protection buy plain vanilla insurance term plan. When you enter army.. buy SAF or SAFRA term plan and forget all other insurance plans in the market. They rob you of 160% of the premium.Worse you will locked in for the rest of your life to your disadvantage.
2.For saving, invest regularly in a RSP (recurrent single premium ) with very low charges unit trust or ETF
3.Don't trust insurance agents because they are salesmen. They can't and don't help you. They are only interested in the commission.
Warning: Be careful ,these salesmen may carry titles like financial consultants, some may have senior or executive before the title to make you think they are financial experts. They are NOT. They are salesmen out to rob you of your hard earned money.
Follow these rules and you will be on your way financial independence.
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