Investing for the future

Hi Mr. Tan,

I am concerned that my savings for the future will be eroded away by inflation and that the yields in the CPFOA may not keep up with inflation.

I am considering putting some savings into UOB Growthpath 2040 fund and also the Combined Fund by NTUC Income. It seems that doing a regular ILP incurs high costs. I am thinking of putting some money in both funds over the next few months. What are your views?

Thanks for the advise on your website. It is sad that insurance agents put a lot of pressure on customers. I almost signed up an ILP with a friend only to realise of the high upfront costs, and also the relatively high annual charge of 1.5%. I was advised to put money in single country funds that are 'hot' economies. I decided to cancel the policy within the 14days grace period. I cannot afford to lose up to 18 months in upfront costs at this early stage of life.

I checked with another agent and was told that not all the information on DR Money's website is true about insurance.

REPLY:

You can read this FAQ about investments:
http://www.tankinlian.com/faq/savings.html

I am not able to give you specific views about the UOB fund. If you wish to invest in the Combined Fund from NTUC Income, you can invest through the Flexi Link policy, where the charges are much lower than a regular ILP.

You did right to cancel the high cost ILP policy. Your savings should be for your future, and not for the earnings of the insurance agent.

Dr Money's advice on insurance is sound. It may not be 100% accurate. My advice is not 100% accurate either. But, they are useful for consumers.