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GRO RETIRE WISE NTUC INCOME (Previously SAIL SP) – With Case Study!

I've been a fan of using the SAIL single premium plan from NTUC INCOME for retirement and medium term savings objectives.

Recently, a private client's policy matured at the 10year mark and the returns delivered by NTUC is pretty good! Details below.

SAIL single premium plan has been rebranded to GRO RETIRE WISE which is this article's focus.

What is GRO RETIRE WISE

Gro Retire Wise is a SINGLE-premium endowment plan

You can choose your desired retirement age from age 55, 60, 62 or 65 (last birthday) or to retire in 10, 15, 20, 25 or 30 years from the start of your policy by selecting the right accumulation period.


For your retirement income as regular payouts, you can choose to receive over 20 years OR in one lump sum at your chosen retirement age.

Min premium is $10,000 lump sum. Previously SAIL Single Premium plan was at min $5,000.

Example of how it works below.

You may also use Supplementary Retirement Sum (SRS) funds to purchase the plan.

Why it even fits medium term savings of 10years

As shown above, the plan has numerous retirement payout option.

If you want to fit a medium term savings objective like a "future gap year from work" or "future potential renovation cost", choose the 10year accumulation period option.

What that means is at 10years, plan will give you option to surrender policy for lump sum payout.

Conversion and versatility of GRO RETIRE WISE plan

In the event that your objective does not need the funds in lump sum, simply convert your GRO RETIRE WISE policy to a stream of payment for 20 years. An additional Special Bonus is included in the computation of Conversion Value if you choose this option.

The conversion value is the sum of all the premiums that you have paid and accumulated bonus at the end of the accumulation period. This is used to provide a stream of payment for 20 years and you've built yourself passive income. The actual amount of the conversion value is not guaranteed.

It is subject to bonuses declared on the policy during the accumulation period. 

The example from a recent case I did above shows how it works. You'd see that conversion value for the non-guaranteed amount (4.75%) is higher.


Subsequently, guaranteed annual payout of $1,760 will be made and there are non-guaranteed annual amounts also based on PAR performances. The first regular payment will be paid one year after the end of the accumulation period.

A further strategy for GRO RETIRE WISE is that you can even choose to "ACCUMULATE" back these yearly payouts to NTUC INCOME. As shown above, it can build towards your future retirement needs.

Recent NTUC INCOME SAIL PLAN matured at 4.1%p.a

Client received a payment of $7,472.50 from NTUC INCOME and equates to an IRR of 4.1%p.a.

Considering that this a 10year policy, the returns in my opinion are very commendable.

Of course, past performance of NTUC's Participating fund (PAR) does NOT indicate future returns and I'm aware that equity markets have been good for the last 10years in general.

This policy started with a $5,000 lump sum savings 10years back. Personal details have been removed.

Summary

GRO RETIRE WISE is a simple plan for saving and highly versatile.

For amounts above $50,000 in conversion value, you can choose to receive the regular payment monthly, quarterly, or semi- annually.

If you've saving for a medium term objective, do consider the strategy suggested above.

Josh Tan Jian Liang (CHFC) Principal Author

REVIEWS: https://theastuteparent.com/josh-tan Practising financial planner with Promiseland Independent Pte Ltd. EXPERIENCE: More than 13years. Josh Tan is a young parent, speaker, author and founder of TheAstuteParent.

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