How much total to cover $1M CI TermLife? Different insurers CI coverage may vary; - pre-post consultation duration by its Panel doctors, - early or advanced stage CI - premium overlay (limited pay or lifetime pay, fixed level or age adjusted cost) - Termlife coverage (accelerated or fixed) - Lifetime or limited age tenure. - in their T&Cs (fine-print). Insurers may not even last our lifetime, even being sold off to another; worse if it closes its biz CI segment. So my opinion is to buy CI through various insurers; better local ones like INCOME, GE Life, Singlife-Aviva. I am not insurance agent. But I am familiar with the cost which I paid for. So allow me to give you some cost estimate to cover $1M in their lifetime over next 60 years! ~~~~~ Someone says CI is good to have. Should it strikes, your loved ones will suffer to take care of you. CI insurance has to work hand in hand with H&S + 10% Co-Pay Assist to cover As-charged cost....
One of my cohorts shared on his recent NEW endowment policy bought with AIA after 1 Jul 2021. It was his first endowment bought. Jul 2021: Single Premium: $45k paid at age 57 After Year-10, Projected payout of $1k p.m. (or $12k p.a.) annually every year from Year-11 to Year-20 (at age 67 to 77). ($45k becomes $120k.) I worked it out on the Xirr calculator to be compounded return of 6.6%; wow it is simply too very good to believe. Based on my knowledge, I shared that if, by then, it's actual payout is $750 p.m. or $9k p.a., he should be laughing every month, at 4.6% compounded xirr rate of return; (highly unlikely to get $1k p.m.) While I agree that AIA is one of the best performing fund for past few years, this projected payout is too good to believe. I also shared a similiar 20-year INCOME Revoretire of $60k premium, payout Year-11 to 20 payout of $9.3k p.a. or $93k p.a. ($60k will become $93k) I am not insurance agent. But I spoke to him with 10-years experience buying 18 ...
How to generate another RA tap? Savings have to be deliberate intention and discipline; putting aside the money or reinvest the cashback and let it compound. My learning from my colleague single policy: *Single $100k @6% (quite decent dividend/interest) put aside for 20year. a. $100k×(1.06^(20) = $320k maturity sum b. Then withdraw it over next 20-years; $100k×(1.06^(20)÷(20×12) = $1.33k p.m. It gives $1.33k p.m. every month for 20-years. c. My colleague chose to save $280k total !! age 48 to 55yo. He started late and hence shorter runway to compound. *$280k ×(1.05^(10)÷(10×12) = $3.8k p.m. But it is still good to enjoy $3.8k p.m. from 65 yo to 75yo. My Takeaway 1. Be it any saving instrument, stocks or endowment or CPF-SA, build up and reinvest or compound it, the principle sum has to be of bigger sum like $200k or $300k portfolio. (The bigger the better, just no quick return and get scammed.) Small portfolio, small outcome.
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