The average Singaporean family enjoys a higher level of safety and security than most countries, making you question why you should even consider having endowment plans.
However, even if you’re always on the safe side of things considering your employment, residence, and environment, the risk of encountering accidents that guarantee total and permanent disability still lingers.
With a life insurance policy with a guaranteed life-assured benefit in most endowment plans in Singapore, you keep yourself and your family outside of financially stressful situations easily. Plus, some high-quality endowment plans offer guaranteed yearly cash withdrawal benefits, so you can have cash during emergencies.
Let’s learn more about all of them below.
Endowment Plans: How Do They Work?
Endowment plans are low-risk policies with a guaranteed interest rate and insurance coverage. They’re similar to fixed deposits because of their policy terms, but you have an insurance policy that protects you from many risks, such as critical illness and permanent disability.
These coverages have their respective premium terms. Some endowment plans will need you to have total premiums paid before their coverages work to your benefit.
Upon maturity, most policies will return your total capital cash value plus the guaranteed interest rates, which can get higher but not lower than the guaranteed rate.
The plans are covered by the Singapore Deposit Insurance Corporation and regulated by the Monetary Authority of Singapore.
What Differentiates Endowment Plans From Other Savings and Insurance Plans?
You can always use unit trusts, fixed deposits, or investment-linked policies providing ample personal protection in case you encounter any accidents or injuries that disable you from working. However, an endowment plan provides you with the following benefits:
1. Serves Savings and Personal Protection
Endowment plans allow you to save money. Even if you haven’t paid the insurance premium in full, you already have face value protection. Depending on your policy’s terms, these are often guarantees that will pay out as death benefits or health insurance.
2. Provides a Predetermined Amount Upon Maturity
Savers can continue saving more money after paying the plan’s insurance premium and total minimum amount. Doing so gives you high guaranteed yearly cash benefits (for some policies) after an appointed amount of time or a higher predetermined amount upon your plan’s maturity.
Short-term insurance savings plans usually have 1-5 years until they reach maturity. Mid to long-term endowment plans can give you intervals of 10-25 years of savings or even go beyond for some products in some cases.
3. Gives Guaranteed Death Benefits
Some endowment plans include face value protection plus an added death benefit that can be a guaranteed percentage or fixed amounts upon death.
4. Has High Liquidity
Your endowment plan is purely cash that the plan provider can quickly liquidate if you need to withdraw. While you will face enormous deductions for liquidating before maturity, it’s still proof that it’s a highly liquid investment.
5 Best Short-Term Endowment Plans
Here are the best and most sought-for endowment plans available in Singapore with high guaranteed surrender value. While they might not have guaranteed acceptance, you can easily address all the total annual premiums paid each one requires.
|Minimum Single Premium||Policy Term||Returns|
|NTUC Income Gro Capital Ease||S $5,000||3 years||1.48% guaranteed annually|
|Tiq 3-Year Endowment Plan||S $10,000 up to S $1 million||3 years||1.62% guaranteed annually|
|Manulife Goal 9||S $10,000||1 year||1.10% guaranteed annually|
|GREAT SP Series 4||S $10,000||2 years||1.30% guaranteed annually|
|DBS SavvyEndowment 5||S $10,000||3 Years||0.82% guaranteed annually. Can reach 2.47%|
NTUC Income Gro Capital Ease: Best For Purchasing Properties and Vehicles
With the NTUC Income Gro Capital Ease, you have a single-premium endowment plan by the policy’s maturity date. It’s an excellent short-term policy with quick maturity and lifelong insurance that only needs three years to fulfill its requirements. Plus, you can apply for this protection of your health condition while it provides you benefits upon death and total and permanent disability.
The savings you can get with Income Gro is useful for property down payment or buying vehicles.
- Maturity benefit: 104.51% with guaranteed 1.48% yearly yield by the end of term.
- Policy Term: 3 years
- Tranche: Available on a first-come, first-served, so always pay attention to NTUC’s announcements
Tiq 3-Year Endowment Plan: Best For Multi-Plan Coverage
Tiq has the highest guaranteed yearly interest at 1.62% versus other short-term endowment plans available in Singapore. To maximize your profits, you can save up to S $ million for a single premium to receive the highest yield possible within three years. Plus, despite your health condition, you can apply for this plan and still receive a guaranteed death benefit by returning 101% of your savings.
You can maximize Tiq’s offers by having multiple plans to grow your money.
- Maturity benefit: 104.86% with a guaranteed 1.62% yearly yield by the end of the policy term. The maximum single premium has a maximum of S $1 million, making this an endowment plan with huge returns.
- Policy Term: 3 years
- Tranche: Available on a first-come, first-served basis
Manulife Goal 9: Best For The Shortest Commitment Possible
Manulife offers the shortest term an endowment plan could ever have, making its guaranteed 1.10% yield after one year a remarkable return for this plan. With this high guaranteed yield, it’s possible that you can get higher returns depending on your deposit, which starts at S $10,000. You can only apply for Manulife Goal 9 by working with a Manulife financial adviser.
- Maturity benefit: 101.1% with guaranteed 1.10% yearly yield by the end of the policy term. The policy provides you with 101% upon your death.
- Policy Term: 1 Year
- Tranche: Always available but requires application through a Manulife financial adviser.
GREAT SP Series 4: Best For Multiple Payout Options
A minimum of S $10,000 gets you a 1.30% yield by the end of its policy term of two years with Great SP Series 4. While the tranche is closed as of writing, it guarantees a 102.6% return by your policy’s maturity and gives you a death benefit of up to 105% or the insurance policy’s cash value, whichever is higher.
- Maturity benefit: 102.6% with guaranteed 1.30% yearly yield by the end of the policy term. You can receive up to 105% benefit or the policy’s surrender value upon your death.
- Policy Term: 2 years
- Tranche: Closed as of writing. Subscribe to Great Eastern’s single premium tranche notifications to have a heads-up in the future.
DBS SavvyEndowment 6: Best For Personal Finance
DBS is an established bank requiring a minimum amount of time to help you gain 2.58% of your deposits with SavvyEndowment 6. Savers can get up to 102.58% of their deposit by the maturity death and receive up to 105% of the policy’s benefit upon their death. It’s a great supplement to anyone beginning on their financial journey because it only needs S $5,000 to start. Of course, a higher deposit will always give better results.
- Maturity benefit: 102.58% with guaranteed 0.86% yearly yield by the end of the policy term. You can receive up to 105% of the policy’s benefit upon your death
- Policy Term: 3 years
- Tranche: Always open but requires registration through DBS Digibank
5 Best Mid to Long-Term Endowment Plans
|Premium Term||Policy Term||Returns Per Year||Guaranteed Capital Upon Maturity|
|Aviva MySavings Plan||10-25 years||10-25 years||Can reach 4.75% with no guarantees||Yes|
|Great Eastern Flexi Cashback||5-25 years||Up to 25 years||
|Tokio Marine Nest Egg||5,10,15,20 or 25 years||5,10,15,20 or 25 years||
|PRU Flexicash||15, 20 or 25 years||15, 20 or 25 years||
|Manulife Ready Builder II||5-120 years||5-120 years||
Aviva MySavingsPlan: Best For Flexibility
Aviva offers a wide range of premium and policy terms, giving it the best flexibility available for any insurance policy. If you’re prioritizing health, then you can have a shorter premium term and longer policy term. A 4.75% yearly return gives you a higher amount by the end of your policy’s maturity date, but this growth is not guaranteed.
In addition, some of its drawbacks are the lack of early cash withdrawal options, limited riders, and zero critical illness coverage except for a cancer premium.
- Interest Rate: 4.75% yearly with no guaranteed returns
- Premium Terms: 10-25 Years
- Policy Terms: 10-25 Years
- Withdrawal/Payouts: 100% capital guaranteed by holding plan until maturity. No early withdrawal options.
Great Eastern Flexi Cashback: Best For Its Highest Guaranteed Returns (at 6% Yearly)
A high guaranteed yearly cash payout of 6% of the sum assured plus withdrawal options after the second policy term year is two of the best things that highlight Great Eastern’s Flexi Cashback. You can use your yearly cash payouts as added funding to your plan. In addition, have a choice between a 5-25-year policy term and premium term and get a 105% of your total standard yearly premiums upon death, making this one of the best mid/long-term endowment plans out there.
The only downsides are its two-riders-only limitation and no capital guaranteed for full-pay plans upon policy maturity.
- Interest Rate: 4.75% yearly with no guaranteed returns. 3% accumulation interest rate.
- Premium Terms: 5-25 years
- Policy Terms: Possibly 5-30 years
- Withdrawal/ Payouts: Guaranteed payouts after the policy’s second year.
Tokio Marine Nest Egg (GIO Cashback): Best For Withdrawal Flexibility
Savers who want many withdrawal options will find Tokio Marine’s offer an excellent one. You can choose from 5-25 years of policy and premium terms, which you can skip in intervals of five years. Plus, you can choose to withdraw your yearly cash benefits by the second policy year and reinvest the cash to improve your plan. You also get a death benefit that provides a lump sum of 105% to your beneficiaries, which includes any accumulated bonuses.
The only downside is that you’re only guaranteed your capital if you hold the policy upon maturity and its no-guarantee policy.
- Interest Rate: Up to 3.8% per year, non-guaranteed.
- Premium Terms: 5, 10, 15, 20, or 25 years
- Policy Terms: 5, 10, 15, 20, or 25 years
- Withdrawal / Payouts: You can withdraw during the 2nd year for either an 8 or 10-year policy plan or reinvest it for higher returns. 100% capital guaranteed until maturity.
PRUFlexicash: Best For Its Yearly Cash Benefits
With PruFlexicash, you can get your cash benefit on the second policy year or choose to reinvest it for your policy’s further growth. It’s flexible enough by offering you 15, 20, or 25 years of policy and premium terms. You can instantly get 100% of your policy’s sum assured in a lump sum by your death.
However, PruFlexicash is a flexible yet long-term commitment because it starts at 15 years and requires medical underwriting to qualify for its insurance coverage. Still, elderly policyholders above 64 years old can stand to benefit from its policy term despite having no guaranteed returns.
- Interest Rate: 4.75% non-guaranteed returns per year.
- Premium Terms: 15, 20, or 25 years
- Policy Terms: 15, 20, or 25 years
- Withdrawal / Payouts: Benefits paid in one lump sum upon maturity. Receive up to 5% of the sum assured yearly cash payout after the policy’s second year.
Manulife Ready Builder II: Best For Having The Longest Insurance Term Possible
It’s outrageous to think that you have a policy term of 120 years while having 5-20 years of insurance premium, but Manulife’s Ready Builder II is a great choice for many things.
First, having a shorter premium period gives you substantial protection against virtually anything and get a death benefit of 105% of your policy too.
Second, having a long policy term that you can withdraw at any time after 15 years is beneficial. You can keep on growing money for yourself or for your loved ones after you’ve passed on.
The only drawback of Manulife Ready Ready Builder II is it does not have any guaranteed returns, but it will accumulate growth because growing your cash for 120 years is a long time not to accumulate anything.
- Interest Rate: 4.25% non-guaranteed yearly returns
- Premium Terms: 5 – 20 years
- Policy Terms: 5 – 20 years
- Withdrawal / Payouts: Breaks even on 15th year and allows withdrawal after breaking even at any time. Guaranteed capital by holding the policy until maturity.
When Should You Consider Having Short, Mid, or Long-Term Plans?
A short term plan is perfect if you’re looking to grow cash like paying for a child’s educational fees, buy a new property, or have enough for any down payment you need, and you have enough cash on your hands to grow your money immensely for a short period of time.
Mid to long-term plans are excellent if you’re looking to grow your cash in the market while having substantial personal protection against virtually anything, including your disability to work. Long-term plans, such as Manulife’s Ready Builder II, are a great recommendation because the longer your cash stays exposed to potential growth, the better its returns can become.
What Are The Risks Involved in Investing in Endowment Plans?
Endowment plans are relatively low-risk financial products with actual benefits payable and can be either a participating or non-participating fund, but their virtually risk-less characteristic is their biggest benefit and downside at the same time.
We all know that wealth accumulation greatly depends on exposure to fluctuations, and most endowment plan companies invest in the safest investments possible to provide you with the guaranteed yearly benefits. Mid to long-term plans don’t have any guarantees, but they’re the best option if you’re looking for substantial growth for your plan.
Our Final Thoughts
Singapore’s finest endowment plans are worth your time and money, so make sure you review each policy’s requirements to maximize the profits and reduce losses you can get from them.
- Endowment plans give you a sizable interest rate based on its yield. Plus, you can get additional bonuses by the end of its policy term.
- Short-term endowment plans can range from 1-5 years and offer you small but guaranteed returns.
- Mid to long-term endowment plans can give you enormous yearly returns without any guarantees.
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