With increasing financial planning knowledge, people undoubtedly understand the importance of long-term savings for retirement & children education. The main concern is to choose the most suitable products for long-term investments. Here introduce some brief concepts of different savings plans.

Dollar Cost Averaging

Dollar Cost Averaging is a way of investing a certain kind of product on a regular basis with a fixed amount of money, regardless of the product price. By this method, a greater quantity of the product will be bought when the price is low, averaging investors’ cost per share over a long period of time. This method is suitable for products which have some short-term fluctuations, yet go upwards in long run. It is especially a perfect cost-averaging method for fund investment.

Fund Savings Plan – From Fund Houses

The greatest advantages of Fund Savings Plan are simple charging mechanism, non-contractual plans and no exit penalties (Or negligible penalties by some fund houses). But these plans generally require $1,000 to $3,000 monthly investment for each fund. So the monthly investment budget can be up to $15,000 for a complete investment portfolio. Furthermore, not many outperforming fund houses provide this kind of savings plan.

Our partners which provide the savings plan:

Allianz Global Investors
CA Asset Management
Fidelity Investments
Franklin Templeton
Invesco
JF Asset Management
Manulife Wealth Management
Principal Global Investors

Unit Linked Insurance Plan

Although these investment plans are wrapped by insurance policy, all premiums under the insurance will be used for investment without charging clients any costs for the insurance. But some insurance companies will only offer a symbolic compensation of 101% of the plan value to the death claim under this kind of insurance plan.

Advantages of Unit Linked Insurance Plan:

Comprehensive Fund Choice

Products under the plan are usually provided by various fund houses, so the fund choice is comprehensive, ranging from several dozens to hundreds of funds.

Personalized Investment Portfolio

Consultant can tailor make an investment portfolio for clients among the various fund choices.

Extra Rewards for Clients

To show gratitude towards long-term investment clients, many companies provide these plans with extra rewards. But some rewards may be affected if any early termination of plans.

Low Minimum Investment Amount

The minimum investment amount is only $720 per month.

Disadvantages of Unit Linked Insurance Plan:

Complicated Charging Mechanism

It is suggested to consult financial advisors for more information about the charges of the plan since the charging mechanism is quite complicated.

Early Redemption Charges

These plans have contractual policy. If the plans are terminated before maturity, the insurance companies will ask for early redemption charges. So it is better to read the investment details carefully.

Our partners which provide unit linked savings plan:

AIA
Aviva
Friends
Generali
MassMutual
Royal Skandia
Standard Life
Zurich

For more information about savings plan, please contact us.