this post was submitted on 26 Jun 2023
8 points (100.0% liked)
Café
771 readers
1 users here now
Welcome to our virtual third place, The Café.
Come on in and make a new human connection over a cup of coffee (or Teh Tarik). This is a casual community, do whatever you want, share your oyen pics, your frustrations, and even organize a weekend picnic with the community. The world is your oyster.
Rules are simple, be kind and civil with each other. As with any other café, rude patrons will be kicked out.
founded 1 year ago
MODERATORS
you are viewing a single comment's thread
view the rest of the comments
view the rest of the comments
I see many people saying investment linked policies are bad though... And ILPs especially have very high commission fees which throws people off. Should I be wary of these? I do plan to start my own financial investments pretty soon too 😥
Investment-linked policies also have different types and they will ask what's your risk appetite and how soon do you want to see returns.
I'll say this much: with few exceptions, not a single fund can beat the market overall. Some years you'll do better, some years you'll do worse. Consider it as a way to park excess money, but if you're eligible for the Amanah Sahams, take those instead.
Eh, shouldn't I treat investments and insurance apart tho ? 😅
I'd say so, but ILPs will be a dominant part of a typical agent's sales pitch so if you don't prep you might get caught up by their catalogue. But at least you got that clear!
Thanks for the great insight by the way! The one thing that bothered me is the base plan was life insurance and TPD, which wasn't what I really wanted(I'm mainly looking for medical insurance). I guess I just need to think what I really and get a plan that I really need, then only add riders as years go on.
TBH, for me the benefits of ILP outweighs the fees.
If you don't do ILP, you can do term insurance (insure-as-you-go, but I couldn't think of that term earlier). Then you need to manage your own investments. Which is a lot of knowledge, time, effort I and many people just don't have.
I guess if you're already got a long, long term plan for investments you can look into this seriously. Put in money into your own investments, and only pay a bit for current insurance. Then let that money grow, but be aware that in your later years you're going to have to pay a HUGE premium for you term insurance as you get more susceptible to ageing problems.
Yeah I'm aware of that... But I probably start it too late either. The latest I intend to start is 5 years later, and if I seem my financial stability good enough I'll start earlier
I guess people saying ILP are scams made me really paranoid. And I realize that even ILP can't protect from rising costs and you might still have to increase the amount you pay. Most people came out saying it wasn't worth it anymore and just stopped?
They're not scams per se, it's just their dividend payouts don't really come higher than market returns. Which makes sense then if you just go straight to an index fund. But we don't have those. The closest we have are mutual funds that acts like index funds.
Investment i do believe is something you ought to decouple from insurance. And seeing your answer I just want to emphasize that because your early 30s is the absolute last best time to get a good rate on your premiums so if you need to prioritize, priority should go to insurance (you're likely not to have chronic conditions, so they can't deny you coverage for preexisting etc. You want them on the hook for having to cover your diabetes for example, not give them the opportunity to deny this + you have to pay higher premium because higher risk)
Maybe some people have a wrong expectation of insurance. Eg, if pay monthly then everything can settle.
So when things don't happen as they thought, they feel cheated and vent to the world.
I sound like an insurance salesman. I'm honestly not ok. I do a totally differnent line of work.
That sounds fair... I guess it's all about the ezpectations. And no I'm not you are an insurance salesman haha 😂