What is an Endowment Plan?
An endowment plan is a life insurance policy which also gives you a risk-free, guaranteed interest for your savings. In other words, an endowment plan is a best saving plan in Singapore with death benefit.
Some endowment plans require lump sum payments (Single-Premium Plans). You will be able to collect your principal plus interest once your policy matures in a lump sum.
What is a Short-Term Endowment Plan?
Endowment plans can range from 3-30 years. Long-term ones are usually opted for retirement planning or children’s education, whereas short-term endowment plans, which mature quickly between 3 – 6 years, are usually signed up by investors who are saving plan towards a specific goal that require lump sum payment, such as marriage, travel or downpayment of a house.
Short-term endowment plans are also preferred by savvy consumers because of its higher guaranteed interest rates, which are higher than Fixed Deposit or SSB.
Top 5 Short-Term Endowment Saving Plans in Singapore to Consider:
| Endowment Plan | NTUC Income – Gro Capital Ease (fully subscribed) | China Taiping – i-Save (fully subscribed) | Life Insurance Corporation – Grow-Easy | Etiqa – Tiq 3-Year Endowment Plan | Aviva – MySecureSaver II (fully subscribed) |
|---|---|---|---|---|---|
| Minimum Single Premium | S$30,000 | S$50,000 | S$50,000 | S$5,000 | S$20,000 |
| Policy Term | 2 years | 3 years | 3 years / 6 years | 3 years | 3 years |
| Guaranteed Returns | 1.21% p.a. | 1.5% p.a. | 1.03% p.a. – 1.08% p.a. / 1.32% p.a. – 1.37% p.a. | 1.62% p.a. | 2.28% p.a. |
| Can be funded by Supplementary Retirement Scheme (SRS) | Yes. +Interbank transfer, Cheque or Cashier’s Order. | No. Payment must be made via Interbank Transfer, Cheque or Cashier’s Order. | No. Payment must be made via Cheque or Cashier’s Order. | No. Payment must be made via DBS/POSB bank account, PayNow /Cheque. | Yes. +Direct Debit, Cheque and bank draft. |
1. NTUC Income – Gro Capital Ease
The NTUC Income Gro Capital Ease (2021 tranche) is a single-premium, short-term endowment plan with guaranteed returns, with just a 2-year commitment.
Policy term:
2 years.
Guaranteed maturity returns:
You are guaranteed a total of 2.43% interest (1.21% p.a.) after two years. Your capital is also guaranteed and covered by Singapore Deposit Insurance Corporation (SDIC).
You can cash out your endowment plan at capital + 1.21% p.a. interest upon maturity.
Other benefits:
You will also be covered for Death and Total & Permanent Disability (TPD) benefits throughout the 2-year policy term, with an additional 5% coverage in the second year. In other words, should this happen, the payout of your premium would be 100% of the premium in the first year and 105% in the second year.
Minimum premium:
S$30,000. This plan can be funded with cash or your Supplementary Retirement Scheme (SRS) funds.
Age Restrictions:
The insured between the age of 10-80 can apply for NTUC Income Gro Capital Ease.
*The current tranche for NTUC is fully subscribed.
Register here to be notified when the next tranche is launched or if there are similar products.
2. China Taiping i-Save
The China Taiping i-Save (August 2021 tranche) is a single-premium, short-term endowment plan with guaranteed interest higher than fixed deposits.
Policy term:
3 years.
Guaranteed maturity returns:
You are guaranteed a rate of 4.57% total return (1.5% p.a.) after 3 years. Your capital is also guaranteed and covered by SDIC. Your total cash out amount after 3 years is capital + 4.57% (1.5% p.a.) interest.
Other benefits:
China Taiping’s i-Save includes death benefit coverage throughout your policy term, and an additional 5% coverage from the 12th policy month onwards. Should the death of the insured happen, the coverage amount is 100% of the premium before the 12th policy month, and 105% after the 12th policy month.
Minimum premium:
S$ 50,000. You can choose to pay via interbank transfer, cheque or cashier’s order.
Age Restrictions:
You can apply for the i-Save plan if you are between the ages of 19-80 years old (next birthday). Parents can also apply to insure their children between the ages of 1-18 years old (next birthday), as the policy holder.
*The current tranche for China Taiping’s i-Save is fully subscribed.
Register here to be notified when the next tranche is launched or if there are similar products.
3. Life Insurance Corporation’s Grow-Easy
LIC Grow-Easy is a single-premium, flexible-term endowment plan with guaranteed returns at attractive interest rates, higher than SSB and Fixed Deposit rates.
Policy term:
3-year or 6-year.
Guaranteed maturity returns:
Enjoy up to a guaranteed total return of 8.22% (1.37% p.a.) in 6 years, or 3.24% (1.08% p.a.) in just 3 years when you deposit S$50,000; or a guaranteed total return of 7.92% (1.32% p.a.) in 6 years, or 3.09% (1.03% p.a.) in 3 years with S$20,000. Your capital is guaranteed and covered under SDIC.
Other benefits:
You are guaranteed death benefits of 100% of the premium paid-to-date for the first 11 months of the policy, and 105% from the 12th month onwards. No medical examination is necessary for application.
LICS Grow-Easy will also pay an additional 10% of the single premium for Accidental Death in the first year of the policy for insured below age 70. You will also be entitled to TPD benefits.
Minimum premium:
S$20,000, but you can enjoy more attractive rates with single premiums starting from S$50,000. LICS Grow-Easy can be funded via cheque or cashier’s order.
Age restriction:
You are eligible if you are between the age of 18 to 70 years old (next birthday).
Apply for LICS Grow Easy today!
4. Etiqa Tiq 3-Year Endowment Plan
Etiqa Tiq 3-Year Endowment Plan is a single-premium, short-term endowment plan with guaranteed acceptance. Perfect for short-term investors.
Policy term:
3 years.
Guaranteed maturity returns:
Your capital is guaranteed by SDIC and you are guaranteed 1.62% p.a. upon maturity of the policy.
Other benefits:
Your named beneficiaries will receive 101% of your single premium as death benefit during the policy term.
Minimum premium:
S$5,000. You can fund your premium of up to S$50,000 via DBS/POSB bank account, PayNow or Cheque.
Age restriction:
You can apply for Tiq 3-Year Endowment plan if you are between the age of 17 to 70 (next birthday).
5. Aviva – MySecureSaver II
Aviva – MySecureSaver II is a single-premium, short-term endowment plan with guaranteed returns and issuance, suitable for investors who want to utilise their SRS funds.
Policy term:
3 years.
Guaranteed maturity returns:
You are guaranteed the return of 2.27% p.a. upon maturity, while your capital will be guaranteed from the start of the 3rd policy year.
Other benefits:
You are guaranteed a death benefit of 105% of your single premium.
Minimum premium:
S$20,000. You can choose to pay via your SRS funds, Direct Debit, Cheque or bank draft.
Age restriction:
If you are funding your My Secure II plan with cash, the life assured for this plan is between age 1 to 75 (next birthday).
If you are paying with your SRS funds, the minimum age for the insured is 19 years old, while the maximum age is 75 years old (next birthday).
Should I Get A Short-Term Endowment Plan?
If you are looking for a short-term, relatively low risk investment, you can consider short-term endowment plans which provide better interest rates than fixed deposits and SSB.
Do take note that you will incur early surrender charges and might lose some of your capital, if you terminate the policy before maturity.
If you are unsure if an endowment plan is suitable for you or have other questions, you can contact us here to clarify more.