Buy Term and Invest the Savings

Hi Mr Tan,
After reading your reply, I decided not to rush into buying a policy. After all the research I had done, I am still kind of lost. I do not know which policy suit me better for my age and my situation.

For your information, I am 20 this year, fresh diploma graduate who had just started my 1st career. I did not buy any insurance previously. Hence this will be the 1st I am buying for myself. Being the bread winner of my family, I think buying an insurance will be safer for me and my family. To me, my concern will be life protection plus some investment which will make my saving grow.

Initially I thought that buying a long term saving plan eg 25years, will be better. I was told that by an insurance company that it will double up by return. The sum of money return was very attractive. However I understand it tied up my money. In case of emergency, I might have financially difficulties. Hence I thought of buying ILP.

However I understand that ILP Will have high charges involved after reading your blog. As u mentioned, by buying a term insurance or decreasing term insurance will be cheaper. Then invest the money in some other investment funds such as uni-trust, bonds, equities etc. The problem is I do not know anything about the share market. I wonder if I am able to invest my money into the right funds. Some banks who I visited, or 1 of the insurance company who I spoke to, offered me regular saving plans or ILP.

No one offered term insurance to me yet. I understand that term insurance had no cash value. Hence I am worry, if I bought a term insurance but end up I do not know how to invest on the investment funds, I might end up buying another ILP. Where do you think I can get more informations about those investment funds? Or is there any ILP or regular saving plan which offer good return with reasonable charges in the market now?

In your advice, is there anything in particular which I should be take note/ beware of before buying any policy? What do you recommend I should do? I also had several doubts which I think maybe you can clarify for me.

1) All policies, regardless whether from bank or insurances companies have yearly policy fee unless otherwise stated?
2) The policy fee had been calculated into our mthly premium or is there additional charges?
3) Does fixed deposit earn better interest and give more flexibility than ILP/saving plan? Appreciate for your time and patient.Hope to hear from you soon.

REPLY
Please read these FAQ:

http://www.tankinlian.com/faq/savings.html
http://www.tankinlian.com/faq/investown.html
http://www.tankinlian.com/faq/termd.html