Complete Guide To Best Short Term Endowment Plan 2020!

​Short term endowment plans are forever popular and their "tranches" are fully subscribed very quickly. 

Again, tranches is a french word for a portion of something, usually of money​.

This article is to give you the ultimate guide on these short term plans. You can use this as a referencing point for present and future offerings.

​How these plans work is very simple.

1) Apply for the plan and make premium payments as soon as possible.

​As the plans are popular, it is usually being offered on a first-come-first-serve, premiums paid basis.

2) Wait for the policy to mature, ​most plans lasts 2 to 5 years.

​​Sometimes a single tranche may have plans offered in two policy terms, for example, SingLife previously ​had a 3 year and a 5 year endowment plan in one offering.​​​ It's natural that the longer period will come with slightly higher returns.

3) Upon maturity, the guaranteed returns with guaranteed capital will be returned to you.

Usually upon the last year, the capital will be guaranteed. 

What to Look Out For

​1) THE RETURNS

​This goes without saying.

The returns of the plans are often affected by current interest rates in the market. AstuteParents will always benchmark the returns against prevailing fixed-deposit rates and SSB rates.

Another important thing to determine if it is simple interest or compound interest. ​This affects the eventual yield at maturity​.

To this end, the easiest thing to do is to find the yield-to-maturity figure.

2) Policy Term

This is how long the policy will take to mature, and for the money to be returned to you. Naturally, the longer it is one should expect higher returns.

Not​ only that, this policy term should determine whether this product suits you or not. For instance, a 3 year plan is not a suitable savings instrument for a young couple that is saving for their house renovation that will be happening in 1 years time.

3) Funding Methods

Can the policy accept cash or is it also SRS-approved? ​Certain insurers allow ​re-investment of ​maturity proceeds of existing plans ​to fund these p​olicies, NTUC Income's Capital Plus is one such example.

4) Other Coverage Included

​What is the death or total permanent disability coverage for this plan?

SingLife allows withdrawal of the single premium without interest or penalty if life insured undergoes any life stage events (subject to various terms and conditions listed).

Summary of ALL plans in the market!

Here, we will list and update plans that are currently available in the market.

NTUC Income Capital Plus ***Fully subscribed on 31st March 2020

​

AVIVA MySecureSaver ***Fully subscribed

Aviva's offering of short term endowment plans tend to be quite competitive and is very popular.

The most recent tranche (MySecureSaver ii) ended in Feb 2020. 

Singlife Endowment ***Fully subscribed

​LIC Wealth Plus V (V = 5) ***Fully subscribed

​LIC stands for Life insurance Corporation (Singapore).

​Current ones are still receiving applications and take note of 2 things here. 

​Firstly, this is a 5 year plan (more consideration needs to be put in given the longer tenure.

Secondly, and most importantly, the interests are simple interest compounded.

**China Taiping i-Save *** Fully subscribed***

China Taiping is one of the newest insurer to enter the very competitive market of insurance in Singapore.

The most recent one offers 2.18% for 3 years which is very attractive given current bank lending rates are higher.

The previous tranche (China Taiping i-Save) ended in Mar 2020 and was at 2.28%p.a.

So rates are really dropping! If you are keen to purchase, get in touch today.

Plans are covered under SDIC

A few private clients has expressed concerns over the brand of the insurer, their credibility, and ability to uphold payments years down the road.

Insurance plans are covered under Singapore Deposit Insurance Corporation (SDIC) as part of regulatory requirements for up to $75,000.

In addition, if you are keen to hear more low risk ideas, look for the video tutorial below.

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