• Best Savings Plans in Singapore

    Today, with living costs on the rise, savings has never been more important. From medical bills to grocery bills, everything around use just keeps getting more expensive. It has become imperative that we set aside a chunk of our disposable income for a rainy day. But setting aside savings are not as easy as it seems. Not only do we have to be prudent and set aside what little we can, we also have to be consistent and resist the temptation to splurge.

    Many a times, when we save up a sizeable amount, we tend to ease up on our efforts. We get lax and ease our foot off the pedal. But life is full of uncertainties and an emergency expense can crop up anytime. Be it a broken down washing machine, a car that needs an engine overhaul or something far more serious like a medical emergency that can leave you with a giant hospital bill.

    Hence, having a savings plan is of the utmost importance. Not only can it leave you capable of meeting life’s unexpected situations but can also help you attain financial freedom. It allows you to see your current position and gauge the direction in which you want to proceed.

    Setting up a savings plan is a simple task and no amount is too low. Set aside what you can each month without struggling to make ends meet and by staying consistent with your savings plan, you would be much better off financially than when you started.

    Best Savings Schemes in Singapore

    Here are some of the top savings plans in Singapore that we think give you the best rates to ensure your savings grow:

    AXA Early Saver Plus

    The AXA Early Saver Plus is a sought after product in Singapore due to the high interest rate and the flexible tenures it offers.

    Advantages of the savings plan – You will get the following benefits on the AXA Early Saver Plus:

    • Guaranteed Payment: The policy offers you guaranteed returns on your payments and safeguards your savings plan by offering a high rate of interest of up to 1.57% per annum. The interest gives you guaranteed returns in the form of Guaranteed Cash Pay-outs. These pay-outs are given in the last 2 years of the policy and upon maturity of the plan.
    • Option to receive benefit in bulk: You receive the accumulated interest in the form of Guaranteed Cash Pay-outs. You also have an available option of being able to reinvest your first and second pay-outs to receive the accumulated pay-out in the form of a bulk payment upon maturity.
    • Flexible tenures: The plan offers flexible savings periods and gives you the option to choose a policy term that can start from 10 years, going up to 25 years (depending on the payment term you have chosen) with the option to choose a payment term of 5 years or 10 years.
    • Save and insure: The plan gives you the option of not just setting aside savings but also allows you to insure yourself against death, death by accidental or terminal illness, and total and permanent disability. The plan also offers riders that can waive your premium if something untoward were to happen to you.

    Disadvantages of the savings plan – Here are some components where the savings plan doesn’t do too well:

    • Low medical expense cost: The reimbursement for medical expenses incurred due to infectious diseases such as Dengue, Chicken Pox, check-ups for diseases such as Ebola or Zika virus is limited to only S$200.

    PRUadvance saver

    Prudential has been in the business of providing savings and insurance solutions to Singaporeans for over 85 years. The PRUadvance saver is a unique product in their stable and offers customers accelerated benefits.

    Advantages of the savings plan You will get the following benefits on the PRUadvance saver:

    • Guaranteed Payment: This policy offers you a guaranteed return on your payments and safeguards your savings plan by offering a high rate of interest on the payments made.
    • Automatic premiums: The plan has a policy term of 12 years of which you only have to pay the premiums for a period of 7 years. After 7 years of policy completion, the automatic premium benefit will kick in and begin making the premium payments for the next 5 years, till maturity. You no longer need to pay any premium after the 7 year period.
    • Lump sum payment: The policy offers a lump sum payment upon maturity. The policy also provides a death benefit of 100% of the sum assured plus any bonuses if applicable in case the policyholder meets their demise.
    • Hassle-free: The policy is easy to acquire through a hassle-free application process. The customer does not need any extensive medical check-up but simply has to answer 3 medical questions to get the process started.
    • Additional cover: The plan offers you riders to enhance the plan’s coverage. The riders include early stage crisis waiver, Crisis Waiver III, early payer security and Payer security III. These riders can either waive the premiums for a fixed number of years or waive off the remainder of the premiums.

    Disadvantages of the savings plan Here are some components where the savings plan doesn’t do too well:

    • Lack of maturity benefits: While the savings plan allows you to enjoy full lump sum payment on maturity, the plan does not provide other major benefits that are usually found in most other plans. The policy does not have any benefits for total and permanent disability or critical illnesses.

    Aviva MySavingsPlan

    Aviva is yet another major general insurance provider in Singapore. They are the appointed provider of the national ElderShield insurance programme. The MySavingsPlan from Aviva allows you to kick-start your savings and offers attractive benefits on maturity.

    Advantages of the savings plan – You will get the following benefits on the Aviva MySavingsPlan:

    • Guaranteed Payment: This policy offers you a guaranteed return on your payments and safeguards your savings plan by offering a high rate of interest on the payments made.
    • Affordable premiums: The saying of even a little would suffice is held true by the Aviva MySavingsPlan. The plan allows you to pay as little as S$1.56 a day. For just over a dollar a day, you can start your savings. The plan that costs S$1.56 per day has a minimum sum assured of S$15,000 and a policy term of 25 years.
    • Lump sum payment: The policy offers a lump sum payment upon maturity. The policy also provides other benefits such as death benefit inclusive of accidental death and cover for terminal illnesses.
    • Riders: The plan comes with a set of riders. These are the EasyTerm rider which provides an additional lump sum cash payment going up to 10 times the annual premium of your basic plan in case you meet your demise or are diagnosed with a terminal illness or are rendered totally and permanently disabled. Cancer Premium Waiver that waives your future premiums if you are diagnosed with any of the major cancers allowing you to focus on getting better instead of worrying about making payments and the EasyPayer Premium Waiver which waives all future premiums in case of unfortunate demise of the policyholder or if the policyholder has a terminal illness or total permanent disability. The premiums are waived but the savings fund will continue to grow.

    Disadvantages of the savings plan – Here are some components where the savings plan doesn’t do too well:

    • Bonus not guaranteed: While the savings plan allows you to enjoy full 100% of the sum assured, the maturity benefit also consists of bonuses which unfortunately are not guaranteed. Thus, the total maturity benefit can be lowered significantly if the bonuses don’t come through.

    NTUC Revosave

    This plan is underwritten by NTUC Income whose network of advisers and partners provide various insurance policies ranging from life insurance to health insurance and even general insurance needs. Along with protection solutions, NTUC also offers, savings and investment solutions to its wide consumer base.

    Advantages of the savings plan – You will get the following benefits on the NTUC Revosave:

    • Cash benefits guaranteed: The NTUC Revosave gives you guaranteed cash benefits on a yearly basis after 2 Years of policy completion. The yearly cash benefit received will be equal to 5% of the chosen sum assured and will be paid out from the start of the third policy year. The cash benefit provided can either be received as a pay-out or you could choose to accumulate the payout with the insurer and collect it on a lump sum basis.

    The plan will pay-out 5% of the sum assured provided you have been paying premiums regularly and the plan is still active. The payout will also be done if the insured person is still alive.

    • High interest rate offered: The NTUC Revosave allows you to earn an interest rate of up to 3.5% p.a. The interest rate is applicable if you choose to accumulate the cash benefits you receive with the insurer.
    • Flexible range of premium payment: The plan allows you to pay the required premiums over a range of flexible tenures that suit your budget, starting from 5, 10, 15, to 25 years. No medical exams are required when you choose a premium payment term of either 5 years or 10 years.
    • Protection: The policy not only allows you to save but also provides protection against unfortunate events such as or total and permanent disability. The plan will only give a benefit if the total and permanent disability occurs before the insured attains the age of 65.

    Disadvantages of the savings plan – Here are some components where the savings plan doesn’t do too well:

    • Only Capital is guaranteed: 100% of the total premiums paid over the policy term is guaranteed. The maturity bonus is not guaranteed and depends on the performance of the Life Participating Fund. Even the interest rate of 3.5% p.a. is not guaranteed. The interest offered will be the prevailing rate at the time of depositing the yearly payout with the insurer.

    AIA Wealth Pro Advantage

    Wealth Pro Advantage from AIA is a unique savings plan that not only allows you to save but also invest at the same time thereby giving a boost to your savings. It offers the dual advantage of having long term savings stability at the same time offering you a potential growth through investments.

    Advantages of the savings plan – You will get the following benefits on the AIA Wealth Pro Advantage:

    • Dual advantage: Half the money you put into the savings plan is deposited into the policy whereas the other half is invested through the Pro Optimiser which offers a well-balanced and diverse portfolio that aims to generate greater returns and boost your savings.
    • Expert advice: Worried about not knowing where to invest? Fret not. With the AIA Wealth Pro Advantage, you get the expert knowledge of AIA’s strategic partner, Mercer investment consulting, which has put together the Pro Optimiser. You get annual reports on your portfolio that allows you to be up to date on your portfolio.
    • Greater control: Along with annual updates, you also have more control over your portfolio. The plan has waived certain fees and charges that make managing your portfolio much easier. Fees pertaining to fund switching and fund rebalancing are waived.
    • Flexible terms: The plan offers flexible premium payment terms ranging from 5, 15, and 25 years. You also have the option to make withdrawals from the third policy year onwards in case you ever need extra cash.
    • Enhanced coverage: The plan also comes with additional riders that enhance the plan’s cover. You can opt for the critical illness premium waiver which waives your premium payments if you are diagnosed with a critical illness. The plan also offers a payor benefit to ensure the benefit is passed onto your child or dependent if you are diagnosed with a critical illness or in the unfortunate case of your demise.

    Disadvantages of the savings plan – Here are some components where the savings plan doesn’t do too well:

    • Investments are pre-select: The plan doesn’t offer services such as auto-rebalancing. The Pro Optimiser is a pre-select portfolio and hence there will not be any ongoing portfolio management. There is also a possibility of the returns from the investment portfolio not meeting the projected rate of growth.

    Five Best Saving Plans in Singapore for 2017

    Product

    Sum Assured

    Tenure

    Features

    AXA Early Saver

    Minimum sum assured is S$20,000

    Minimum tenure of 10 years with maximum tenure of 25 years

    Optional riders that wave premiums if policyholder is not capable of payment.

    Can trade two cash pay-outs for one bulk sum payment at maturity

    PRUadvance saver

    Minimum sum assured is S$30,000.

    Maximum Sum assured is S$250,000

    12 years

    Automatic premium benefits for a period of 5 years.

    Optional riders to enhance coverage

    MySavingsPlan

    N.A.

    10 years to 25 years

    Additional riders to enhance coverage.

    Capital is guaranteed.

    Premium waiver riders available.

    NTUC Revosave

    Policy guarantees 5% of sum assured from start of 3rd year of policy till maturity.

    Up to 25 years

    Interest rate of up to 3.5% p.a. for yearly pay-outs accumulated with the insurer.

    Benefits for death and total and permanent disability.

    AIA Wealth Pro Advantage

    N.A.

    N.A.

    Half the money is put towards the policy whereas the other half is invested in Pro Optimiser which is balanced and diverse portfolio.

    How to choose the best savings plan to maximise your savings?

    Here are some tips on how to choose the right savings plan for you:

    • Before getting yourself a savings plan, you need to know what the purpose or objective of the plan is. Are you looking for a way to stow away money for a rainy day? Are you trying to achieve certain milestones or other quantifiable goals? Having a clear objective can help you settle on the right plan.
    • The tenure is the second most important thing to keep in mind. Unless your goal is to pass on your savings to your children, the plan should have a tenure that you can utilize. Choosing the right tenure is subjective and depends on your age as well. Older people will have to choose a smaller tenure if they want to realise their goals quicker whereas younger folk can opt for longer tenures. Tenures usually go up to 25 years and choosing a tenure can also help you gauge how much money you would like to save.
    • Consider your risk appetite. Most savings plans offer you a guarantee on the capital which means you will receive all the premiums you have paid, but the maturity benefit includes bonuses that are not guaranteed. Some plans even invest half your capital in an effort to boost your savings but the projected growth the plan advertises is not guaranteed. When choosing investment options and portfolios, one must do so wisely after through research.
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