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 INSURANCE TALK, ok let start

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SUSPink Spider
post May 2 2013, 03:23 PM

Formerly known as Prince_Hamsap
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QUOTE(HJebat @ May 2 2013, 02:53 PM)
Guys, here's my details:

Type of plan: saving plan
Annual payment: $2017.00
Payment period: 20 years
Cash value at 20th year: $55298

I tried to calculate the rate of return of the cash value at 20th year using free online tools and it turned out to be 2.92%. I'm poor with numbers. So, I would like to check with those regulars here, is my calculation correct?
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Yes, 2.92% annualised return i.e. IRR. icon_rolleyes.gif

Use this as guide for IRR calculation:
user posted image

This post has been edited by Pink Spider: May 2 2013, 03:36 PM
SUSPink Spider
post May 2 2013, 10:02 PM

Formerly known as Prince_Hamsap
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QUOTE(MNet @ May 2 2013, 07:31 PM)
Where can I get the spread sheet?
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LYN cannot attach spreadsheet. I've already given u the screenshot with a simple example and clear explanations, try to work it out yourself.

QUOTE(HJebat @ May 2 2013, 09:57 PM)
Thanks for the replies, guys. rclxms.gif

I guess there's a discrepancy between the calculations because 1.854% per annum is the average annual return, while 2.92% IRR is the rate of return with the compounding effects. Correct boh?

BTW, Pink Spider: thanks for the guide on excel too. I'll try to recreate the spreadsheet in excel and do my own calculation again. rclxm9.gif
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Simple rate of return does not take into account the timing of cash flows i.e. the concept of "time value of money" - RM100 received today is more valuable than RM100 received next year. It just takes

TOTAL PROFIT / TIME

Internal Rate of Return (IRR) takes into account the timing of cash flows, it is a more fair measure with which to compare the viability/profitability of different investments. nod.gif

This post has been edited by Pink Spider: May 2 2013, 10:03 PM
SUSPink Spider
post May 3 2013, 09:35 AM

Formerly known as Prince_Hamsap
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QUOTE(HJebat @ May 3 2013, 08:28 AM)
Is IRR = CAGR?
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They mean slightly different thing but the essence is the same wink.gif
SUSPink Spider
post May 5 2013, 10:33 PM

Formerly known as Prince_Hamsap
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QUOTE(HJebat @ May 5 2013, 09:48 PM)
Care to explain more? (paiseh blush.gif )

Because if calculate using IRR = 2.92% (lousy rate of return)
I calculated CAGR = 4.41% (ok, ok modest rate of return la)
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No, the meaning/application is different, but the calculation is the same, why u get different???
SUSPink Spider
post May 6 2013, 10:49 PM

Formerly known as Prince_Hamsap
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QUOTE(HJebat @ May 6 2013, 08:46 PM)
The IRR part, I used the same formula as the one that you had posted (the one with the Hello Kitty pic).

For CAGR, I used online calculator (again  tongue.gif )
Present value: $40340 + $55298 = $95638
Beginning value: $40340
Number of years: 20
So, calculate punya calculate, it came out as 4.411%

Apa macam? Wrong ka?
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Salah la bos doh.gif

1. Beginning value: $40,340 is already salah. U pay $X amount every year for 20 years, 20 x $X = $40,340. As such, rightfully your beginning value is "0".
2. CAGR if I'm not wrong, is only applicable where u pay $X LUMP SUM at the beginning, and let the amount grow over a period. E.g. u invest RM500,000 in a piece of land and let the value of the land grow over 20 years.

When u have periodic cash flow and a maturity amount, IRR is the correct measure to use.
SUSPink Spider
post May 7 2013, 10:15 PM

Formerly known as Prince_Hamsap
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QUOTE(HJebat @ May 7 2013, 10:05 PM)
Oooo...I see. OK, thanks. Now I'm very "terror" and expert in calculating rate of return liao lor. laugh.gif
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Take charge of your finances, know what u are putting your money into thumbup.gif
SUSPink Spider
post Jul 12 2013, 10:04 PM

Formerly known as Prince_Hamsap
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QUOTE(roystevenung @ Jul 12 2013, 09:47 PM)
If you die and you submit it to your agent, your agent will freak out man.  sweat.gif

But if you are referring to your beneficiary, then yes, a certified true copy will suffice.
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I LOL-ed laugh.gif
SUSPink Spider
post Jul 12 2013, 10:05 PM

Formerly known as Prince_Hamsap
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QUOTE(mcfeemo @ Jul 12 2013, 09:59 PM)
From who do we get the certified true copy??
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Commissioner for Oaths @ Pesuruhjaya Sumpah

Most legal firm/lawyer got this service
SUSPink Spider
post Jul 12 2013, 10:26 PM

Formerly known as Prince_Hamsap
********
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QUOTE(mcfeemo @ Jul 12 2013, 10:21 PM)
so basically, my family have to look for any lawyer to get the certified true copy?..

so if i have 5 life insurances from 5 different insurance companies.... they have to get 5 copies of certified true copy from the same lawyer?
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Yes, they have to produce the original for him to sight, then he will certify true copy on the photocopies. His charges are by no. of copies

Remember ask your family to bring "you" along to prove that u are really dead lol just kidding

This post has been edited by Pink Spider: Jul 12 2013, 10:26 PM
SUSPink Spider
post Jul 13 2013, 11:12 AM

Formerly known as Prince_Hamsap
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Use common sense

If u buy RM100K and RM150K medical limit

Of course u would claim from B if u got a claim of RM120K for example
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