Yes. Because the discount factor uses the FD interest rate, so if you get a positive NPV it means that this investment is better than FD.

If the interest rate rises, will the Annuity given by GE also increase? If not, then you can change the interest rate and see that when interest rate rises, the NPV falls, making the GE investment less attractive. If the interest rate falls, then the NPV rises, making the Annuity more valuable.

The assumption is RM780 tax savings per year. In reality will the highest tax bracket remain at 26%? Will the tax rate be reduced in the coming 9 years? If yes, then the tax savings will be less. This will result in a lower NPV, making the GE investment less attractive.


The PRS conservative funds might perform better than FD because part of the money is used to invest in stocks. I am unable to recommend any particular PRS provider because Unit Trust is not my expertise.


Unit Trust is not guaranteed. Lets assume the stock market crashes and hence the Unit Trust price falls in the year you are eligible to redeem your investment. If you redeem the investment then definitely you will be redeeming at a lower price. But if you can wait several years until the stock market recovers, then your Unit Trust price will also recover. If at that time only you redeem, then you will be redeeming at a higher price. You will need to judge whether you have the financial strength to hold your position or not.

The GE investment provides you with cashflows for 9 years, whereas the PRS UT if you redeem before you reach retirement age then you will get a penalty of 8% of the redeemed amount. If you withdraw after reaching retirement age, then no penalty.

In the GE investment, is it compulsory to invest the RM3,000 every year for 10 years? Can you stop investing in Year 7, and then continue again in Year 8? In PRS, you have the flexibility to stop investing and continue again the following year.

These are some of the factors to consider. I suggest you discuss with an independent qualified financial planner who can help you assess your options.

Great Eastern Retirement Plan.

-post deleted-

This post has been edited by xuzen: Mar 26 2013, 08:44 PM

Is PRS from Public Mutual has MQGP calculation? Anyone?

Annuity is kinda a new product from insurans company. Something like investment link de..

PRS from public ain't really performing well.
dissapointed.
klci hitting new high and yet from launch till now, price has not even increased by 1%!!!
their growth fund is a joke. especially so since index breaking new high. the conservative fund is the best performer of all their fund.
compared to hwang, the returns are fabulous.

Magician najib gor

lol...

I don't invest in Public PRS so I don't know if it's performing or not. But I just want to highlight one thing that a lot of people mistake is they just look at the NAV price they buy and the current NAV price. This is not correct. We need to look at the total value of the fund (ie. total units multiple NAV). This is because some funds distribute units as dividend. And after the distribution we will have more units, but the NAV will drop. But overall, if you take total units multiple by NAV, you'll reach the same value before and after distribution.

So, even though the current NAV is the same as the NAV you buy, but if you have more units then the total value of your fund has gained. Your investment has gained.

boss, i'm comparing apple to apple (absolute investment in versus present total absolute amount).
in a nutshell, PRS is not performing compared to other funds.

OK. The PRS fund that you have chosen is not performing.
Then I must be lucky because my PRS fund has gained more than 10% since I started to invest at end of last year.

This post has been edited by simplesmile: Jun 4 2013, 02:29 PM

PRS and Deffered Annuity. Both has its pro and cons.

Let me begin:

PRS is flexible, like buying a car. You don't like it, you may change it to another model (aka transfer from one PRS provider to another)

PRS, like car, you can change the colour anytime you want (aka switching, can choose from growth to moderate to conservative fund)

Annuity is like marriage, once sign, you cannot tukar half way, it will be like a divorce i.e, terribly expensive. Die die also must keep.

Understand, Paham, Meng pak Moh, Capisce, Kow Chai Mai?

Xuzen

This post has been edited by xuzen: Jun 4 2013, 03:17 PM

I forgot to add that even though the value of your investment might not have increased however, don't forget about your tax relief. If your tax bracket is 19%, then for every new dollar you put into the PRS, you already get 19% return. Thinking this way, your PRS already gave you back some return.

that was the only bright side of it.
if compared to other funds, eg. Hwang, it's performing so much better.
sigh.

I have access to all the PRS performance. Your statement above which I bolded lead me to believe that you may have invested in a slow lumbering giant known as Public Mutual PRS where you need to pay a high entry fee for sub-par return.

Hence your opinion is skewed; some of us are very happy with PRS generally b'coz we contributed into a zero sales charge provider and getting top mark return.

In a nutshell, the performance of PRS fund are in this descending order:

Hwang>CIMB>RHB>Manulife>>>>>>>>>Public Mutual.

AMBank cannot be counted because they just launched their PRS in Apr-13.

Xuzen

yes. you are absolutely correct.
i did meant to say PM PRS is not performing as well as other provider of PRS fund.

any idea why boss?

One word Mr Kochin: "LOSERS" with a Capital L. Pub-Mut fund manager suxs BIG TIME.

Xuzen

Time to top up some in PRS this month. Want to achieve 3K till end of year.

ROTFL....
which provider shall i switch to boss?
Any recommendation?
The only saving grace is my tax deduction savings.
Else.

Sorry, for this one year you are stuck with Pub-Mut. You can only transfer your PRS after one year.

Any fresh injection, go for hwangPRS.

Dump Pub-Mut-PRS.

Xuzen