Lifetime layered endowments payout

My Ferrari story (in brief)

1. Prudsave policy

Loose coins savings into a small sum.

I free free bought this PrudSave in Aug 13 at OSIM Race Kit collection day then.

Premium was $6k p.a. for 7 yrs, total: $42k.

This is like putting aside $500 p.m for 12-month, for 7 years. Like no salary increment in 2013, then every year I missed $6k per year "forever."

This Aug 25, it becomes $53k lump sum as promised.

xirr: 2.62%. What Prudential BI payout stated, it honours it.

~~~~

2. First 10 new endowments:

From age 58, lump sum payout started: $29.1k+$5.2k+$3.3k+$2.2k = $40k p.a. from age 58 to 64.

In addition, these 10 endowments pay me another continual burst of annual payouts: $24k p.a. from age 66 to 80yo.

3. Next 10 Resale endowments

From age 66 to 68, I would build up another burst of larger payout sum, amounting to $400k+.

If I invest it @5% p.a. dividend, I will get $20k p.a. lifetime 

4. Last 5 Resale endowments

It will be meant to give me a lifetime annuity payout of $4k p.a. from 66 & 5 payout boosts, whenever I want to surrender. 

5. My Takeaway

It takes a lot of discipline to save.

Actually this continuous stream of payout starting from age 58, will allow me to retire. 

Somehow when age 58 comes, it becomes so tempting not to retire too early.

Comments

Post a Comment

Popular posts from this blog

Can retire with $1k monthly? got bluff me?

  Someone who is my cohort just retired last year.  He candidly shared that his average monthly expenses is less than $1000. Some background that I gathered: 1.  Married with a working adult child. 2.  Stay in condo; ever spinned n profited from few property sales. 3.  Still need to support aged parent with 4 siblings. 4. No car. So I did some quick calculation to see sure or not to retire with $1k monthly expenses. Think his $1k p.m. is thin retirement. Utility & PS, water : $100 p.m. Telco: $20 p.m.  MCST: $200 p.m. (where got so low maintenance?) Medishieldlife: $800 / 12= $66 p.m. (can pay by CPF-MA) H&S Shield Plan: $1200 / 12 = $100 p.m. (excluded $680 deducted from MA) Support his parents: $2000/5 = $400. Basic fixed monthly overhead:  100+20+200+100 + 400 = $820 With just $1000 p.m., net available for meal = $1000 - $820 = $180 p.m. (or $6 per day) Not forgetting that he just retired, he need to fully pay his last year personal income t...
Read more

How to generate another RA tap?

  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.
Read more

AIA 20yr endowment payout at 6.6%, can trust?

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 ...
Read more