Month: April 2024

Let’s refer to the previous post of the $100,000 annual premium regular investment-linked plan portfolio. The bar chart below is extracted from the previous post.

Based on the projection, with an estimated amount of $185,000 we can potentially fully self fund a $100,000 annual regular investment plan. From Year 6 onwards, a potential $7000 excess dividend after funding $100,000 of the regular investment linked plan. Then , by the 10th year, we potentially has excess $66,000 annual dividend on top of the $100,000 premium payment. Eventually, potentially $230,000 annual dividend on top of the $100,000 premium payment at the year 20.

In this particular case study, based on projection above, the investor will be able to potentially create a passive income of $7,000 at the end of Year 6, $66,000 at the end of Year 10 and $150,000 at the end of Year 15 and $230,000 at the end of Year 20.

When deploying DCS via a regular premium investment-linked policies of annual premium $100,000, investor will also potentially create an insurance coverage of $600,000 sum insured at the end of Year 6, $1,000,000 sum insured at the end of Year 10, $1,500,000 sum insured at the end of Year 15 and $2,000,000 at the end of Year 20.

Creation of growing cash flow and growing insurance coverage with as little as $185,000

For investors deploying DCS via an investment linked plan, beside building up their passive income for retirement and legacy plan, they can also achieve their estate plan concurrently.

Disclaimer: Do note that the above is just for personal sharing for brief reference and education purposes only. It is not meant to be an investment or financial advice. For financial advice, please seek help from your financial planner or financial consultant.

In our recent data collected from an existing portfolio using DCS-S3 strategy for the past 4-5 years, we noticed a growing dividend year on year. The portfolio consist regular premium ($100,000 per annum) investment linked plans investing into carefully selected investment funds. Let’s take a look at the past 4 years data and the projection.

From the above, we can see that the investor who invested $100,000 per annum $35,227.47 in the first 12 months. In the next 12 months, he received $47,757.86. On the subsequent 12 months, he collected another $62,181.80. By the 48th month, he has gotten another $77,444.90.

At the first glance, it seems that investor has invested $400,000. But after deducting the amount he received as dividend, his net investment is only $64,772.53 in Year 1, $52,424.14 in Year 2, $37,818.20 in Year 3, $22,555.10 in Year 4. Total net amount invested is only $177,574.97, instead of the initial impression of $400,000 investment over 4 years.

As you can see from the above data, $32,810.95 of dividend already collected from the first 4 months. Let’s take a look at the projection of the dividend payout from Year 5 and beyond.

Based on above chart, the investment is potentially fully self funding from the Year 6 with about $8,000 top up (based on projected dividend of $92,000) on Year 5. From Year 6 onwards using only $185,574.97 ( $177,574.97 + $8000) approximately to fund a $100,000 annual premium of a regular premium investment plan.

In our previous article, we mentioned about Passive DCS. Technically, when deploying a Passive DCS, it’s relatively simple. If we are deploying it via a regular Investment plan, we just need to allocate it to a carefully selected fund which possess the necessary Passive DCS Quality (PDQ). Thereafter, we just have to fund the plan on a regular basis. Example Monthly, Quarterly or Annually.

Although volatility is expected as part and parcel of almost all unit trust investment due to price fluctuation of the underlying fund, it is observed that account value and dividend maintained relatively stable and gradually growing when we reinvest the dividend paid out.

Based on a small regular investment plan using Passive DCS Deployment, the results are as follows.

Below is the price fluctuation of the PDQ Fund A from Sep 2023 to Mar 2024.