Did you end up committing to the purchase?

Hi,

Received this offer from one of the bank. Details as below.
- A fixed deposit (similar amount) per annum whereby one-off for the 1st year and multiple deposits for the subsequent year.
- Counted by the date of 1st deposit as a year for the dividend.
- The principle is compulsory to be deposit annually for six years before being able to withdraw.
- After the 6th year, if you haven't withdrawn the accumulated principle - you can enjoy continuous dividends for a maximum of 20 years.
- Dividends for frontliner - 30% p.a (!!!) - limited time & quota for selected group of individual.
- Minimum of RM10k/year. Don't overcommit as you need to deposit a similar amount every year for six years.
- If you haven't withdrawn the dividends, it will be compound for the next year with an average of 5-8%. However, you are free to withdraw the dividends as you like.
- Possible to open more than one policy.
- Policy approval is based on overall financial status.
- Limited quota.
- Insured by PIDM.

The guaranteed of 30% p.a for maximum of 20 years was in black & white on my form from the bank, not agent's lips.

Most likely going to open for both of my kids if all okay.
Thanks in advance for all the input and insight!

I don't know what plan you are posting.

But based on above limited info, it is more like a saving plan or endowment plan. It is not a fixed deposit with 30% or whatever % dividend/interest.

Saving plan guaranteed cash back is not your earned interest or dividend. It is not like you placed 100K with 30% cash back, then you you have 100K + 30K. It doesn't work that way.
Once you get the 30%, then surrender value drops.

A portion of cash back came from your own capital.

Normally saving plan return rate or IRR is more and less comparable to FD rate if held until maturity.
You need to count entire amount guaranteed cash back you are getting + maturity amount you are getting to determine the "real" dividend you are getting.
It is not like every year you get guaranteed 30% or 20%, then you still get back your own origin principal amount.

Saving plan is long term commitment, any premature withdraw may affect the principal amount, it is not a fixed deposit.

It is irresponsible for anyone to promote saving plan as fixed deposit.
It is also irresponsible to say guaranteed cash back is an interest or dividend earned.

Some of my family members fell into the same traps before (the wealth booster plan by HLB), and they can't withdraw thereafter (hefty penalty). (My parents bought for me and regretted).

I calculated the IRR thereafter and it's somewhat like 4-5%. Even worse than your EPF return and can easily be on par with the current ASNB FP fund returns.

Many insurance agents (at least in Malaysia) like to promote saving insurance (or saving plans) and treat them as FD products, cheating customers' money.

The agents just sweeten the deal by manipulating the numbers as shown by some members above. Look before you leap.

Offer ends by 12pm+ today.

maybank has a similar plan called Smartcash Xtra. They gave me the same sales pitch. Did my calculation and it came to around 4% PA.

Maybank is guaranteed right? While HLB is not.

read post 17,....there is this word "Guaranteed Income per year (RM)", in title heading of the 5th column

the main different between this 2 plans, looks like; one is guaranteed % of yearly payment based on premium paid and the other is based on sum insured.

in the end both will have their final cash value greatly impacted when compared with other "normal" plans

Simple rule of thumb - when see/hear HLA stuff, run other way

aaahh damn... already buy this plan in august 2020. If i cancel it now, wont probably my full capital. This year is hard because of covid.

aaahh damn... already buy this plan in august 2020. If i cancel it now, wont probably my full capital. This year is hard because of covid.

Don't worry, it's still a good vehicle to park your money for long term, you can call it as a sort of wealth preservation, the money won't disappear for sure the next 20 years.

i would not call it wealth preservation though....
yes, the money will not disappear for sure in in the next 20 years....but i am just not sure it can "preserve" my wealth in the next 20 years.....will the returns be enough to covers the inflation cost?   

i would not call it wealth preservation though....
yes, the money will not disappear for sure in in the next 20 years....but i am just not sure it can "preserve" my wealth in the next 20 years.....will the returns be enough to covers the inflation cost?   

effective i/r around 4%~6% according to some calculations here, isn't that enough to cover?

Simple rule of thumb - when see/hear HLA stuff, run other way

Love this comment.

Being a Hong Leong shareholder, I can confirm this. Love the dividend though.