Income Invest Flex Vantage

Income Invest Flex Vantage is an investment linked plan (ILP) brought to you by NTUC Income Insurance. ILPs have come a long way since they began, with a whole lot of bonus units and flexibility features.

Table of Contents

Some elaboration on the features of Income Invest Flex Vantage:

● Potential income stream from the 1st policy year: Income Invest Flex Vantage offers the option to receive potential income streams from the first policy year with dividend-paying funds. This allows you to supplement your living expenses while building your wealth.

● Maximized Investment: The plan allows for up to 105% of your regular premiums to be used to purchase units, increasing your investment potential.

● Investment Bonuses: The policy offers an investment bonus of up to 55.0% of your regular premiums paid during the first policy year. This bonus is used to purchase additional units in your chosen funds, enhancing your investment growth.

● Loyalty Bonuses: Starting from the 10th policy anniversary or the end of your Minimum Investment Period (MIP), whichever comes later, you receive an annual loyalty bonus of 0.5% of your policy value. This bonus is also used to invest in your selected funds.

● Charge-free partial withdrawals during specific life events: The plan allows charge-free partial withdrawals during the MIP when certain life events occur, including turning 21 or 65, marriage, purchasing a residential property, or becoming a parent.

● Premium holidays: Income Invest Flex Vantage provides the flexibility to take a premium holiday for up to 120 months from the 5th policy anniversary without incurring any charges. This option allows you to temporarily pause premium payments while your investment continues to grow.

● Death or terminal illness coverage: The plan provides a death or terminal illness benefit, ensuring your loved ones are financially protected.

● Secondary insured option: This option enables you to appoint a loved one as a secondary insured, allowing your policy to continue in the event of your death.

● Hassle-free application with guaranteed acceptance: Income Invest Flex Vantage offers guaranteed acceptance without requiring a medical checkup, making it easy to start building your wealth.

Income Invest Flex Vantage Associated Risks:

● Investment Risks: Like any investment, Income Invest Flex Vantage is subject to market fluctuations and investment risks. The value of your units may rise or fall, and you could potentially lose some or all of your capital invested.

● Fees and Charges: Various fees and charges are associated with the plan, including policy fees, insurance cover charges, surrender charges, partial withdrawal charges, and premium holiday charges. These charges can erode your investment returns.

● Insufficient Units to Cover Fees: If your policy value becomes insufficient to cover fees and charges, your policy may end prematurely, even after completing the MIP (minimum investment period).

● Dividend Uncertainty: Dividends from the chosen funds are not guaranteed, and their frequency and amount may vary at the discretion of Income Insurance.

● Premature Policy Cancellation: Cancelling your policy prematurely may result in a cash value that is less than the total premiums paid.

● Consider the Investment Horizon: Before committing to Income Invest Flex Vantage, consider your investment horizon and ensure it aligns with the plan’s features and potential risks.

There is a hypothetical use case scenario with John, a 45-year-old individual, to illustrate how Income Invest Flex Vantage can be used to grow wealth for retirement while providing financial protection.

Age 45:

John signs up for Invest Flex Vantage with a 10-year Minimum Investment Period (MIP) and an annual premium of $12,000.
He chooses a dividend-paying fund with an illustrated potential dividend payout of 7% per annum.
He opts to receive the potential dividend payouts as monthly income.
He receives an investment bonus of $2,400 (20% of his regular premiums). This bonus is used to purchase additional units in his chosen fund.
John receives a potential dividend of $996 in the first policy year.

Age 50:

John is hospitalized due to an accident.
He makes a charge-free partial withdrawal of $10,000 to cover his medical expenses, utilizing the life events withdrawal benefit.
Due to financial constraints, John takes a 24-month premium holiday at no charge.

Age 55:

John resumes paying his annual premium after the MIP ends.
His illustrated policy value is $73,252.
He starts receiving an annual loyalty bonus of 0.5% of his policy value, which is reinvested in his chosen fund.

Age 57:

Income Insurance starts investing 102% of John’s annual premium to purchase units.

Age 67:

John retires and continues to receive his monthly dividends to supplement his retirement income.
Income Insurance increases the investment to 105% of John’s annual premium.

Age 85:

John passes away, and his family receives a death benefit of $450,460. The policy terminates.
There is an alternative scenario where John lives until age 85. In which case, his illustrated policy value would be $316,926, and the total potential dividends paid throughout the policy term would be $511,381.

Take note of the following Important Considerations:

The figures used in this scenario are for illustration purposes only and are not guaranteed.
They are based on an illustrated investment return of 8% per annum and assume an annual management fee of 1.5% per annum.
The actual returns may be higher or lower depending on the fund performance.
The scenario provides a general overview of how Income Invest Flex Vantage can be used in a real-life situation. However, it is essential to remember that individual circumstances and investment goals will vary from yours. Consider booking a discovery session with Isaac to discuss suitability.

Some things to note. This review post will get dated. And the product might not be available for new subscriptions at some point. Hopefully this serves as reference for future policyholders who have forgotten what they have taken up.

There can be shifts in planning narratives over time. For example, limited premium tenures gain popularity over the years because people are less confident of their future earning capacity or sustainability of income levels. Regular payout features gained popularity when more and more people are in tune with the FIRE (Financial independence retire early) movement. An extended period of low interest rates brought down insurance products’ returns yield for policy holders, but now in a rising interest rates environment, things are set to change.

Income Invest Flex Vantage may or may not fit into your financial plans. Understand that there is no best plan for all time, but there is a method to objectively facilitate your decisions. Read more about it here.

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