An Introduction to Saving Plans and Endowment Policies

What are Saving plans and endowment policies?

Commonly referred to as a regular saving plan, Saving and Endowment policies allow future financial goals or objectives to be met with basic insurance coverage.

Various riders can be added to enhance the policy in the event of death, Terminal illness, Critical Illness or Total and permanent Disability. Such insurance riders are usually added when the policyholder is determine to ensure that unexpected life events does not disrupt the intended savings goals.

Features such as flexibility for partial withdrawal of savings are available in certain policy, which may result in a lower maturity cash value if withdrawals are made.

Some policies allow selection for premiums to be paid until the maturity of the policy or for limited numbers of years.

Related article: Endowment and Saving policy: How does it work?

Related article: Endowment and Saving policies: Is it the best option?

Who are Endowment and Saving Policy suitable for?

An endowment is suitable for risk adverse profile as they are often principal guaranteed. It is also beneficial for people who cannot save regularly. You may consider an endowment policy if you are looking to save for a particular goal over a long-term, minimally ten years.

A person who has been saving regularly into their bank account every month from their salary should also consider to partition their savings into two parts, leave a part in the savings account for emergency use, and another part in an endowment to generate a higher return as compared to a savings account.

Limited Payment or Regular Premium: Which is better?

For a higher rate of returns, consider a limited payment savings and endowment policy. As premiums are fully paid in the early years of the policy, there is a longer amount of time for the policy to accrue financial returns.

A regular premium endowment and saving policy does not allow as much time for financial returns to accrue. This is due to the premium paid in later years of the policy not having sufficient time to compound until the maturity of the policy.

Do take note that not all limited payment endowment have cash-back option for flexibility.

Related article: Effect of compounding returns

Related article: How can I accumulate a million dollar (Realistically)

What are the best endowment saving policies available?

Without preferences and in no order of ranking, here are some of the popular endowment and saving policies available in Singapore:

Endowment and Saving Policy (Limited Payment)

• Singlife: Choice Saver
• China Taiping: i-Saver8
• Etiqa: Enrich Assure
• Manulife: Grow Secure
• NTUC Income: Gro Saver Flex Pro
  
  

Endowment and Saving Policy (Whole Life Endowment)

• • Singlife: Flexi Life Income II
  • NTUC Income: Gro Cash Plus
  • Manulife: Readybuilder II
  • China Taiping: i-CashLife
  • Etiqa: Enrich Income
    
    

Related article: 4 Best Fixed Maturity Endowment Savings Plans in Singapore for Wealth Accumulation (Updated)

Related article: 3 Best Endowment Savings Plans in Singapore for Lifetime Wealth Accumulation (Updated)

What other insurance policies related options are available?

An Investment Linked Policy which offers investment elements into restricted funds can be considered. Alternatively, if insurance coverage is not required, look in generating a higher financial return by managing an Investment Portfolio.

Related categories: Investment Linked Policy

Read more: 6 Best Investment Linked Policies in Singapore (Updated)

Where can I compare the payout and benefits of Endowment and Saving Policies?