HSBC is currently having a promotion on their existing Guaranteed Saver Plus plan which is a fixed 5 year term single premium non-participating endowment plan.
With the premium discount campaign, the annualised yield could go up to as high as 2.75%. The yield is guaranteed and not a projection.
The discount for various investment amounts is as follows:
20k-49,999 : No discount
50k-74,999: 1.2% discount
75k-97,999: 2.4% discount
>=98k: 1.2% discount
How the discount works is that you only have to put in the premium net of discount. For eg, if you are investing $100k, you will need to fork out $98.8k.
Applying the discount, the annualised yield works out to be:
20k-49,999 : 2.25% p.a.
50k-74,999: 2.5% p.a.
75k-97,999: 2.75% p.a
>=98k: 2.75% p.a.
If you are confused by the discount, you can read an explanation here:
What I Meant by Annualised Yield
This premium discount campaign is only effective from 1st June 09 to 30th June 09.
There is no medical underwriting required for this plan and is available on a first-come-first-served basis.
15 comments
2 pings
blur says:
June 11, 2009 at 1:28 pm (UTC 8)
Do you know what is the interest on the endowment plan ? FD interests are very low now and endowments do seem more attractive .
lioninvestor says:
June 11, 2009 at 2:11 pm (UTC 8)
Hi Blur,
the interest on the HSBC plan is given as the annualised yield in my post above.
CC Lim says:
June 11, 2009 at 8:46 pm (UTC 8)
Hi
Thanks for the notice.
Just to clarify – do you mean we actually received the interest in advance in the form of discount. At the end of the 5-yr, we will only receive the net amount, eg if one invest $75,000, the discount will be $75k x 2.75% =$2062.50. Net amount = $72,937.50. But is the interest – $2062.50 paid annually?
lioninvestor says:
June 13, 2009 at 4:18 pm (UTC 8)
Hi CC Lim,
Apologies for being a bit unclear in my post. Please see the latest post for a more detailed illustration:
http://www.martinlee.sg/what-i-meant-by-annualised-yield/
Jasmin says:
June 12, 2009 at 7:20 am (UTC 8)
Hi CC Lim,
I have a feeling otherwise.
If one invests 100k (as mentioned), he pays a discount ie not 100k but 98.8k. Upon maturity, he receives 100k. That difference would give you 2.75%pa.
Two things to note:
(1) Higher amt (98k) does not translate to greater discount. The 75k-97999 enjoys a 2.4% discount.
(2) Would the bank or insurer goes belly up during the holding period? When that happens, our $$ will be gone!
We will wait for lioninvestor to comment.
lioninvestor says:
June 13, 2009 at 4:16 pm (UTC 8)
Hi Jasmin,
The product is offered as a single premium insurance product by HSBC Insurance and will not be affected by the failure of HSBC bank.
Please see my other post for a more detailed illustration on the yield:
http://www.martinlee.sg/what-i-meant-by-annualised-yield/
blur says:
June 12, 2009 at 12:45 pm (UTC 8)
Does anyone know what is the best FD or savings rates offered currently ?
Depp says:
June 12, 2009 at 11:17 pm (UTC 8)
Hi
,
Dont bother to look at it !
Try foreign banks. u ll be surprised on how can foreign bank can do it !
and the min. requirement. !
Intheknow says:
June 14, 2009 at 5:53 pm (UTC 8)
2.75% p.a. for a 5 year investment is pathetic… sorry to say.
lioninvestor says:
June 14, 2009 at 9:57 pm (UTC 8)
Hi Intheknow,
Yes, there are higher yielding instruments around and this product might not be the best option for everyone.
Different strokes for different folks.
5-year SGS bonds is currently giving yield to maturity of 1.29% p.a.
chee says:
June 24, 2009 at 6:08 pm (UTC 8)
Hi Lion ,
Is this product does not fall under the Singapore Deposit Insurance Act ?
thanks & rgds
Chee
chee says:
June 25, 2009 at 7:01 pm (UTC 8)
Hi Lion ,
Is this product fall under the Singapore Deposit Insurance Act ?
Please advise.
thks & rgds
Chee
lioninvestor says:
June 25, 2009 at 7:55 pm (UTC 8)
Hi Chee,
This is not a deposit and as such does not fall under the Singapore Deposit Insurance Act.
However, for insurance products – the Insurance Act provides for the setting up of a Policy Owner’s Protection Fund (”PPF”) to compensate policy owners. Under the current provisions, the PPF will cover up to 90% of an insurer’s liability on any life policy.
chee says:
June 26, 2009 at 3:19 pm (UTC 8)
Hi Lion ,
Thanks.
rgds
Chee
Depp says:
June 17, 2009 at 9:47 pm (UTC 8)
Hi Lion ,
how do you view the asian currency ?
Will SG and RMB contiune to rise against the region asean?
What I Meant by Annualised Yield says:
June 13, 2009 at 4:12 pm (UTC 8)
[...] There were some questions on the annualised yield figure that I provided in my previous post on the HSBC Guaranteed Saver Plus. [...]
TM Nest Egg (SP - Guaranteed 3) says:
July 5, 2009 at 3:15 pm (UTC 8)
[...] compete against similar plans that have been recently launched in the market. One of them is the HSBC Guaranteed Saver Plus which gives a yield of 2.25% to 2.75% (depending on amount invested). I suppose those who like [...]