Review: Singlife Grow – An “Enlightened” ILP, Supposedly
Singlife Grow is an investment-linked policy (ILP) that I encouraged my readers and Telegram subscribers to apply for. Seth – the guy who has for years railed against savings plans, agents like Hayley, and yes ILPs – encouraged people to buy an ILP. In fact, scratch the past tense; I still encourage you to do so, but first let’s set aside the pitchforks and allow me to explain.
Two things about ILPs before we get into the review:
ILPs are not automatically bad… but I haven’t seen a good ILP
Saying that a product is automatically bad because it’s an ILP is a false premise, strictly speaking. If there’s anything I dislike more than ILPs, it’s a logical fallacy. As I noted in my older article, ILPs can be good if it’s designed well with a fair fee structure.
That said, it does not seem like any product provider is interested in doing something like that, and we have to wonder why any company would even bother with that given the sullied name of ILPs. You have to fight against years of ingrained negative perceptions, and for what? Smaller profit margins?
There are, however, less bad ILPs
Regular premium ILPs
Regular premium ILPs (RP-ILP) are pretty bad because of the usual suspects: high commissions (as can be seen from low initial allocation rates) and high fees (incredibly, added thing on top of commissions). If you are told that a particular ILP would suffer capital losses if you terminate prematurely, and if you have to pay regular premiums or the plan will lapse, it is an RP-ILP. They also tend to offer a significant amount of insurance coverage.
RP-ILPs are accompanied by its less nefarious cousin single-premium ILPs. These are sometimes known as 101 ILPs, or recurring single-premium ILPs, and they focus almost solely on investment and tend to give a rather minimal 101% death benefit.
These aren’t all that bad; the allocation rate tends to be close to 100% which means you are not paying through your nose in commissions. Aside from the death beneift, they have a close resemblance to unit trusts, higher fees included.
Singlife Grow is a single-premium ILP
Singlife Grow is in the second category of ILPs i.e. t is nowhere close as bad as regular-premium ILPs. Now that we have gotten some facts about ILPs out of the way, I think we can look at Singlife Grow with less of its ILP baggage. Singlife’s ads call this an “enlightened ILP”, so let’s see whether such a bold claim bears out.
Like so many things in life, whether to purchase a product boils down to a cost-benefit analysis.
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Cost is perhaps the first thing we should talk about: Singlife Grow is not cheap. A quarterly 0.25% fee translates to about 1% yearly, and easily comparable to what roboadvisers charge.
Syfe, for instance, currently charges between 0.4% to 0.65% per year depending on the amount invested.
This is the most apparent fee, but it’s not the most significant difference between them.
Below is the list of funds that Singlife Grow portfolios invest in, as well as their expense ratios:
|Fund||Expense Ratio||Singlife Conservative||Singlife Balanced||Singlife Dynamic|
|Neuberger Berman Strategic Income Fund SGD-H||1.17%||50%||34%||12%|
|BlackRock Global Funds – US Dollar High Yield Bond Fund||1.46%||10%||8%||4%|
|United SGD Fund||0.67%||10%||0%||0%|
|United Asian High Yield Bond Fund SGD-H||1.45%||10%||8%||4%|
|United Global Quality Growth Fund||1.86%||10%||21%||33%|
|Nikko AM Shenton Global Opportunities Fund||1.47%||0%||10%||16%|
|Fidelity Funds – World Fund||1.89%||8%||8%||13%|
|Eastspring Investments ‐ Global Low Volatility Equity Fund||1.56%||0%||4%||7%|
|JPMorgan Funds – Asia Pacific Equity Fund||1.80%||2%||7%||11%|
|Weighted Expense Ratio||1.32%||1.51%||1.66%|
With the exception of a couple of funds, the funds hover around 1.5% expense ratio with some even flirting with 2%. The most affordable one, United SGD Fund, is only present in Singlife Conservative portfolio, and even then it represents only 10% of the portfolio.
Again for comparison, Syfe invests primarily in ETFs which have comparatively much lower expense ratios, roughly between 0.15 to 0.32%.
A higher cost product isn’t automatically lousy, so what do we get with the added cost?
Is it worth it?
Performance: I don’t think so
The perennial question when it comes to investing: does paying higher fees translate into better returns? It’s a longstanding question, and I’m going to say that I’m in the camp that believes active management with higher fees tends to produce lousier returns than a lower-cost passive approach.
Convenience: at best on par with alternatives like roboadvisers
Singlife Grow offers easy and fuss-free contributions from a small $100 per month, and you can manage your portfolio with an app. Groundbreaking, if it were a decade ago, but it’s almost 2022 now and this is standard fare. Roboadvisers let you invest small amounts regularly, and also lets you manage your investments with generally well-designed apps. It’s a wash at best.
Death coverage: it’s something, but not a lot
The single-premium ILP it is, Singlife Grow offers 101% death benefit on the account value or amount invested, whichever is greater. This seems nifty, but what many might not realise is that death coverage is cheap. Really cheap, especially if you are relatively young. A 30-year-old could get upwards of $300,000 to $500,000 of coverage with just $200 a year.
Let’s say there is a Singlife Grow competitor that charges 0.4% less If you invested $300,000 into Singlife Grow, that extra 0.4% translates into $1,200 of additional cost.
Here’s why you should get it anyway
The sign-up gift is pretty good
Currently, there is a $30 sign-up gift ($35 if you don’t already have a Singlife Account) for a small investment of $1,000. Singlife Grow’s downside is its cost, but this sign-up bonus more than covers Singlife Grow’s quarterly fees and the expense ratio of the subfunds for an entire year.
If you feel that Singlife Grow isn’t living up to its high fees, you can always terminate it since there is no lock-in period nor penalty for doing so.
You can earn cashback!
You also get $15 or $17 when you fund the initial $1,000 with Amex True Cashback or UOB Absolute Cashback cards!
The cash account is good
When you sign up for Singlife Grow, it boosts your Singlife Account with an additional 0.5% p.a, making the rate 1.5% p.a. Singlife Account may have been nerfed a few times before, but 1.5% p.a. represents a good rate for a cash management account given the current interest environment, and it has an added bonus of being fixed. You can even boost the return to 2% p.a. by spending on the provided debit card (search our Telegram group for more info on how best to do this).
While roboadvisers’ cash management portfolios generally aim at 1.5% to 2% p.a. returns, it is subject to investment volatility. Events in recent weeks would have caused dips in those portfolios.
Do note that the bonus rate is only limited to the first $10,000.
The referral programme is great
Finally, you can refer friends and family for up to $35 a pop which a pretty generous referral programme. $1,000 is a small outlay when it comes to investing, and the high fees are more than covered by the incentive for more than a year. There is no lock-in either, so I doubt anyone would feel bad recommending this to their loved ones.
You must first have an in-force Singlife Account policy to start referring. Your friends must sign up for a Singlife Account and activate their Singlife Card to start earning credits.
No Singlife Account: Sign up with code vxRcK4uN activate your Singlife Visa Debit Card to receive $5. Start and fund Singlife Grow portfolio to receive $30.
Existing Singlife Account: Start and fund Singlife Grow portfolio to receive $30. Make sure not to press Skip when you first start the portfolio so you can enter the code vxRcK4uN
Fund your Singlife Account with Amex True Cashback and UOB Absolute Cashback for added cashback.
If you like this site, signing up with my code also directly supports the continuation of it. It takes time and effort to produce articles and videos, so all forms of support are appreciated. As a public referral programme, anyone is free to use whomever’s code as they wish, so I’m very thankful for all who have chose to support me.
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I mentioned in my article about ILPs that I want to see a good ILP being released, and I am still holding out hopes for it.
In the meantime, we get Singlife Grow. It’s not the very best, but it is certainly not extremely bad. With a decent sign-up gift and no lock-in period, it’s worth giving Singlife Grow the benefit of the doubt, at least for a year. Otherwise, given the lack of withdrawal penalty… 🤷🏻♂️
- For now, a good sign-up gift
- Convenient and easy to invest
- No lock-in or withdrawal penalty
- Good companion cash account Singlife Account gets added 0.5% p.a.
- Fees are high compared to cheaper roboadvisers
- Not as enlightened as we would want ILPs to be… this is basically a single-premium ILP that has existed for a long time
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