Like any other skill you can pick up, the earlier you start investing, the better you will likely be at it over time.
Giving your investments enough time in the market is another crucial element to achieving your financial goals. The earlier you start investing, the longer the runway you have to compound your returns.
On top of encouraging you to start your investment journey from an early age, AIA Pro Achiever 3.0
ploughs 100% of your premiums into investments from the start. Moreover, you also enjoy a boost of up to 75% in Welcome Bonus over the first three years. In the 10th policy year, you start to further compound your portfolio with a 5% Special Bonus. This rises to 8% per annum in the 21st policy year.
By investing early, we are also able to ride out economic booms and busts as our investments have sufficient runway to recover and continue growing.
While we ought to continue investing regularly, there may be instances when we need to pause our investments, especially if we become personally affected by the economic downcycle. Being able to pause our investment gives us some freedom to get back on our feet before we resume investing.
Self-directed investors can easily stop investing. Similarly, investors who are on regular investment plans with robo-advisors can pause investments, or if you own an investment-linked policy such as the AIA Pro Achiever 3.0
, you can also request for a premium pass – where you can opt to pause premiums for a year, at no charge.
When we invest with a financial goal in mind, liquidity is an important requirement. The risk here is that our investments suffer a major market crash right before we want to make a withdrawal. For example, during the COVID-19-led market crash in 2020, stocks fell about 30% within several weeks.
Self-directed investors can glide into a less risky portfolio if they are confident.
Those who invest via an investment-linked policy can choose a relevant investment horizon and pivot to receive dividends from their policy or make partial withdrawals.
When we invest on our own, we have to choose an appropriate portfolio for the long-term. Besides money, we also need to invest our time and effort to monitor and build our portfolio, and have the expertise to drawdown from our portfolio in our golden years.
By leveraging on investment-linked plans such as via AIA Pro Achiever 3.0
, we can tap on expert guidance from globally-recognised asset managers such as Baillie Gifford, BlackRock, Capital Group and Wellington Management to construct our portfolio based on our varying risk appetites – AIA Elite Conservative, AIA Elite Balanced, and AIA Elite Adventurous.
There are typically two layers of fees – at the investment fund level (usually below the 2% mark) and annual supplementary charge by AIA during our investment timeframe (at 3.9%). These are partially offset by various bonuses that investors receive. You should check in with an AIA Financial Services Consultant
to discuss whether the investment is suitable for you.
Author: Dinesh Dayani, DollarsAndSense.