Ferrari Me (Ferrarilim)

Someone recently said that ILP n Endowments are no longer attractive.  I agree with him. But I am not so sure of indexed UL ILP which tracks the S&P500.  If hold till death, its bequest payout is good. I would say that it depends how savvy one uses the investment: 1. Disciplined form of forced savings which we otherwise may not be able to accumulate diligently. 2. Just another passive income tap, better than FD.  3.  RESALE W/LIFE plans > For me, I bought resale wholelife plans from young Assured person; solely from INCOME, to save as Cash "Critical Insurance" payout if needed when I surrender.  >These W/Life plans already cost breakeven based on their current actual Surrender Value (SV).  Their SV arestill tracking their projected SV Table based on the updated BI when I bought over the policies. >If I buy CI, its premiums are sinking fund, but I can still cash-out my premiums which adds to the SV. (not that I have choice, at my age, CI riders have expired or its

  Part 2: Should I put money in my children SA? On far longer horizon, 50-years!! Effective very long-term compounded SA interest rate is 12%.  (1×(1.04^(50)−1)÷50×100 = 12%!! I wouldn't say risk-free for no one can predict the CPF future in next 50-years !!! In other words, $1 ---> $12 (after 50-years) $100,000 ---> $1,200,000 (after 50-years)!! ~~~ Critics may ask if CPF would still be around? I will reply if CPF would be around to pay us 4% p.a. for next 20-years?

  Investment perspective of OA & SA One colleague shared his view on the breakeven return rate for the below: 1. Should we invest using SA? 2. Should we invest using OA? ~~~ 1. Should we invest using SA? To assess if an investment is viable, we check SA @4% p.a compounded for 10-years. 10-year effective SA compounded interest: (1×(1.04^(10 years)−1)÷10 years ×100% = 4.8% p.a. In other words, for 10-year compounded at 4% p.a., for SA pays an effective rate of 4.8% p.a. ! Risk Free. Not many investment can guarantee payout @4.8% p.a My Takeaway: 1. Keep your SA balance in CPF.  Don't invest with it. I wouldn't. ~~~~ 2. Should we invest using OA? To assess if an investment is viable, we check 0A @2.5% p.a compounded for 10-years. 10-year effective OA compounded interest: (1×(1.025^(10 years)−1)÷10 years ×100% = 2.8% p.a. In other words, for 10-year compounded, for OA pays an effective rate of 2.8% p.a. ! Risk Free. Are there many investment which can guarantee payout @2.8% p

 I spoke with few from my cohorts on their use of their OA: 1. REIT . I bought REITs. Small bites for now. (But firstly, with my T-bills maturing in Nov 24, I can invest ~$100k from my srs) 2. ILP . One invested almost all OA into Annuity; he mentioned AIA; 3. ANNUITY . One in Prudential product, maybe not all OA Balance. 4. OA . Few still keep in OA, to earn 2.5% 5. STOCK . One already invested all in local stocks as dividends. He mentioned Banks n Reits. 6. CASH . One withdrew all and self-invest. 7. PROPERTIES . One withdrew to buy properties for children. 8. O/S EDUCATION . One finances his children overseas education. 9. CASH . One was told to withdraw all in CPF as he was no longer a SG, including his RA Balance. 10. LG500 ETF . One couple is all into Endowus LG500!! 11. O/S PROPERTY . One invested in MY property. Caveat : OA balance has to put aside bare minumum sum of $20k which cannot be invested or withdraw. My takeaway : 1. Thanks to the enabling CPF for our retirement