Tag Archives: Savings

The Reason Why I Need Insurance….

My Client’s confession……

Here I list down five main reasons why I bought an insurance and why everybody should have one too. P/S: I am not trying to sell anything here, just stressing out something important that everyone should know.

  1. For My Own Protection – When I was about to resign from my job, I was thinking, what if I suddenly had a serious illness or involved in accident and not able to work and earn any income? what will happen to me? Yes, I still have my family, but would it be fair to burden them? Would I want to burden them? I am not married, so I cannot be asking help from my husband. Will I have enough savings for the treatment and those health related matter? Will I trouble my parents and siblings for that? Sometimes, these thought made me having sleepless nights. With an insurance policy, at least I am covered for my illnesses with adequate financial support for any expensive treatment.
  2. For My Savings – I am a business minded person which means that I am very calculative when it comes to my money but there are times that I spend money just to make myself and people who surrounds me happy. Yes, I do have my own savings in the bank and in mutual funds but with insurance, It’s another medium for me to force myself into saving a few hundred bucks monthly by contributing to my insurance premium and one thing for sure, by receiving my yearly account statement, I know where my money goes too.
  3. For My Investment – Partial of my premium will be invested into selected funds with a handsome return that you can’t resist. Absolutely a great way to have extra money and it is safer too as insurance minimize the risk factor on your investment.
  4. For My Retirement – With the hope that everything goes well without me making any major claims or withdrawals, I can retire early and receive my investments and live in Paris with my cats.
  5. For My Future – When I learned that your premium increases together with your age, I realize that I really need to have an insurance coverage as early as possible. I do not want to wait until I have my own family or other big financial commitments in life as by then, the premium to start an enrollment for my insurance will be very high and insurance company have the rights to rejects or excludes applications with health problems. Among all of the above, the main reason why I decide to take up an insurance coverage is still based on the first reason which is PROTECTION. In case of any accidents or serious illnesses, there will be a strong financial support for myself and my family.

 

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Introducing the New Pru Link Million….!

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Investment Linked Plan – Everyone is a Millionaire.

An exclusive regular premium investment-linked insurance plan that provides you with a high coverage of RM500,000 and above, and safeguards what is important to you and your loved ones.

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How much you should save per month for your child future education in College or University?

college

Every parents have a dream for their son. To be engineer, doctor, lawyer and so on. To realize the dream, parents should prepare in financial when they time come.

Many of us, we have a big dream but we didn’t  prepare for the dream. You must start savings now because education is not cheap.

How much you should put aside for your child future education (monthly)?

Step 1

  • Determine age of child : Example 5 years old

Step 2

  • How many years before he/she begins college : 19 – 5 = 14 years

Step 3

  • How much the annual cost for the college? :  Google or from booklet.

If you choose Engineering,  price taken from Taylor’s University College

Price per semester RM51,400 .3 semester per year. Total yearly = RM154,200


Step 4

  • Consider 6% inflation factor : Price 14 years later, 154,000 x 2.26 = RM348,040

How do i get the 2.26 value? The value refer to inflation table. Email me if you want the Table

Step 5

  • Total cost to complete study? : 2 years x 348,040 = RM696,080

Step 6

  • If you do savings in investment product, use this Step 6 : Investment returns after taxes 8%

696,080 x 0.038 = RM26451.04. How do i get the 0.038 value?  Email me if you want the Table for investment return.

Step 7

  • How much savings per month?

Rm26451.04 / 12 months = RM2204.25 per month!

If you don’t put your savings in Investment products :

RM696,080 / 14 years / 12 months = RM4143.33 per month!

Conclusion

Education is expensive.

There are lots of parents out there, which are afford to put RM1000 or RM2000 per months savings for their kids. Small salary earner, I totally understand but i hate to see big incomer earner to neglect their kids.

Above you can see comparison between, savings in Investment products compare to normal savings . If you want to do long term savings, investment is the place you should dump your money. Save RM370,314 to get RM696,080 or save RM696,080 to get RM696,080. You decide.

RM2204.25 per month! Wow, this amount are bigger than monthly salary average Malaysians.  Dont be afraid, if you cant afford to save this amount for your kids. I also cant afford this. The moral of the story, we MUST put aside some money for our kids every months. Small amount like RM100, as we know from here, it will never be enough. At least, we do some savings for them.  It helps to reduce the amount of education sponsorship later. Dont make your kids burden with loans before he even start working.

Why should we buy Insurance compare to do own Savings?

save moeny

SAVINGS

Every month you do savings of RM200.

End of the year , total accumulated RM2400 + + (Including interest) (0.3% if in saving account  3% if in Fix Deposit, 7% if in ASB)

Assume the savings constantly up to 5 years. Amounting RM12,000 ++

Unfortunately, you are diagnosed for Cancer preliminary level which need RM50,000 for treatment cost

Thanks for your savings, you have RM12,000 but you still need RM38,000.

You have 3 options to fund the balance

  • Borrow

Family and friends will try their best to help you. But to borrow RM38,000 is near impossible unless your have a very rich relative.

  • Sell your assets

Your maybe have one or two assets which can be sold. But it takes at least 6 months to sell a house for example. If your assets still under bank’s loan, yet you cant sell it off.

  • Seek for Donation

Your saw on television, people seek  donation for themselves or their kids. Need money for surgery or treatment. If you are disable or really poor , you are qualified to seek donation under the television programme. But, you are income earner like executive in one big company, you will not getting any help by the donation programme because there are more needy people out there.

INSURANCE

Every month you do savings of RM200.

End of the year , total accumulated RM2400 + + (Including interest) (8%-9% in InvestmentLink or Takafulink plan )

In case something bad happen to you , death or total permanent disable , Sum Assured RM100,000 will be compensate to next of kin or to you. (Even you pay insurance just for one month which is RM200 )

 

Up to 5 years. Amounting RM12,000 ++

Unfortunately, you are diagnosed for Cancer preliminary level which need RM50,000 for treatment cost. Now Medical Card will cover all the cost for you. Limit RM500,000 per lifetime.

Plus, Rm20,000 compensation because diagnosed with one of the 36 critical illness.

Plus, when you been hospitalized, you will be receiving RM100 per day as hospital benefits.

If you unable to work and no money to pay your premium, Contributor plan will continue to pay it. As the result, you still receive Protection and your savings still continue growing until age 100.