AVIVA MyLifeSavingsPlan | More For Child Savings Than Retirement

Why is it MyLifeSavingsPlan?

I personally think it’s simply because it’s SAVINGS for a LIFETIME? (Till age99 maturity to be exact).

Actually if you own this policy, the life long saving can even be seen as saving for your next generation.

Some background on MyLifeSavingsPlan?

PRUWealth is the first solution of this nature from my memory.

Then came Manulife ReadyBuilder Plan. AVIVA may be the third and latest insurer to issue a “Till age99” endowment plan A.k.a Perpetual Endowment plan.

This post is more for how this plan can help your financial goals. To read brochure, click here.

If you’ve a child on the way or an infant now, how to use MyLifeSavingsPlan to plan for child education costs?

The AVIVA MyLifeSavingsPlan can be tailored to limited premium payment terms of 5, 10, 15, 20 or 25 years.

If your child is not born yet and you would like to start saving now, you can actually do so by purchasing a policy on yourself. Start accumulating savings into this policy today for his/her future education needs.

Below is an snapshot of an analysis done for a private client aged 39 and it can be used to illustrate the concept.

In 20years time, there is a 1.55%p.a guaranteed growth in capital.

A $11,992.50/year plan for 10years premium plan (total $119,925) has a guaranteed $152,304 if a full surrender is done at year20. The projected value with non-guaranteed components on the benefit illustration is at $175,142-$208,864.

With non-guaranteed components, projections can be up to 3.61%p.a (when illustrated at 4.75% investment return). 

If you use this plan, instead of fully surrendering the policy at year 20, you can do a partial withdrawal instead to fund your child’s education costs.

The remaining value in the policy can be accumulated further to help for another financial goal such as  for your own retirement.

How does AVIVA MyLifeSavingsPlan compare with Manulife ReadyBuilder Plan

This comparison was done for the same private client.

As mentioned above, the guaranteed yield p.a for AVIVA MyLifeSavingsPlan in 20years time is 1.55%p.a. It compares well against the 0.44%p.a guaranteed yield in the Manulife ReadyBuilder Plan.

What if PAR fund performance is compared?

PAR fund average performance over the last 3years is superior for Manulife at 4.90%p.a. The AVIVA plan performance is at 3.87%p.a.

On the other hand for average over last 5years, PAR fund performance is almost identical at 3.29%p.a and 3.28%p.a respectively.

MANULIFE PAR returns below

AVIVA PAR returns below

Lastly, the withdrawal methods from the two plans are identical.

Refer to next section…

How does a withdrawal from AVIVA MyLifeSavingsPlan work?

Click on the link below to view the rest of the article :


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