Is endowment payout better than our SA?

I just reserve to buy 2 more resale endowments. 

They will add to my 9th resale endowments.

Part1:  As an illustration of one of them.

Simply, at age 47, I bought:

First Insurance from GE direct:

1st policy of $100k; pay $20k p.a. x 5 year.  In this case, I talk about (one $20k) bought in 2012, matured and payout ($29.1k) in 2023 (after 11years).   This is a new endowment which I bought from GE insurance directly.  At that time, I don't think that there is such Resale Insurance market yet.

Second insurance. Resale Endowment:

After 10-years, this first endowment matured last year. Started to payout on 11th year.  That's when I reinvest into Resale Insurance.

This matured sum of $29.1k is then recycled to reinvest in 2nd resale policy, which will mature in 6-Yr in Year 2029. (My age 65).

It's combined IRR: 4.47%

Invested $20k,got $29.1k which then reinvest $18.4k to get $24.3k.

In summary for Part1:

$20k --》($29.1k - $18.43k) + $24.32k 

$20k --》$34.99k

~~~~~

Part2: Similiar to above Part1,

I actually reinvested my second $20k into the 2nd similar resale endowment. 

In total, to add up the two resale policies:

$20k --》($29.1k - $31.6k) + 39.7k 

$20k --》$37.2k

~~~

In summary, combined effect:

$20k x 2 ---》($34.99k + $37.2k), or simply:

$40k --》$72.2k (after 16-years)

[Simple IRR: 3.7%

$40k x (1.037 ^ 16) = $72.2k]

The effective combined IRR: 3.7%.

The actual IRR calculator (for both resale endowments alone) would have given better result as it computes based on regular premium payments over 6-years.  I assume simple single payment.

To me, roughly can already: 3.7% (through nibbling saving gets some extra is also good).

Please dont be amused by my nibbling.

It's scalable.

A policy bought $100k, can become $180k (after 16-years at age 65):

(=$100k /$40k * $72.2k = $180k)

This $180k can offer:

1. buffer $1k p.m. for 15-years, drawdown, or

2. continue to reinvest into equity to get dividend of $7.2k @4% or higher.  Again it has risk.

3.  It pays and adds $1k p.m. from age 65 to 80 year old.

~~~~~

Qn1: 

Someone would ask "Why then I might as well topup into CPF SA?"

Answer: My SA has hit FRS; (and zooped into ERS max in RA account)

This can be another retirement Tap.

Qn2: Are these Resale Endowment guaranteed or included the non-guaranteed? 

The numbers included the non-guaranteed portion.  This Resale endowment market is quite new; maybe less than 10-years.

So far, none of my Resale policies bought has matured.  But their payouts are by the Original policy insurers.

My recommendation of insurer choices would be local ones (like Ntuc, GE) where they tend to pay return near to Upper Benefit Illustration Fund Performance.

The above two policies are from NTUC n Prud.  I bought them through TES Capital.

It fits my tenure to payout at age 65; notice Prud is not local insurer. I take some risk; also risk of possible lower payout.

I am not advocating anyone to buy.  

Just sharing options.   I am not an insurance agent.  

Of course T-bills n current FD rates are still very good to consider.  

Need to do your research and cannot blame anyone.