Dear Sir,
I wish to seek your advice on the MyRetirement policy by Aviva being sold in DBS. My wife and i are actively searching for places to grow our nest egg in order to retire comfortably. We were enticed into the DBS branch at IMM and it seem a deal too good to be true.
It is a "8-pay" endowment policy whereby, we will have to pay monthly or annually a premium for a total of 8 years. After which, we will not have to pay any more and it is this period when we dont pay till our retirement age, 50, 55, 60, 65. It seems the later we claim back our policy, the lessen a premium we pay.
Our policy was like, we pay monthly 833 for 8 years and we will get a payout of 1,000 monthly for 10years from 50-60, 55-65. there is also a lump sum payout after that.
Can you help to advise if the policy is worth considering? If all these savings and endowments are not useful, can you help to point us to the right investment direction? Many thanks !
REPLY
You can use an Excel spreadsheet to calculate how much your money will earn for you if you are able to earn a yield of 4% on your investments. You can credit your yearly savings with interest at 4% and draw out the payout yearly based on the illustration giveny by Aviva. If there is still remaining money after the last payout, it means that you can get a better outcome by investing on your own to earn 4%.
To learn about a better way to invest the money, you can attend the talks given by FISCA, http://easyapps.sg/
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