If you’re considering investing into a fixed-term savings or investment plan in the UAE, make sure you do your sums.
The National has asked an expert to calculate exactly how much five of the most commonly sold products in the UAE will cost you in charges – and the figures are astounding.
The products are administered by insurers such as Generali International (Vision), Zurich International (Vista), Friends Provident International (Premier), RL360 (Quantum) and Hansard International (Vantage) and sold to residents via financial advisers.
According to Julian Vydelingum, a chartered financial planner at AES International, an investor could pay up to 51.68 per cent of the amount they invest in charges as a percentage of their total contributions if they have signed up to RL360’s Quantum product over 25 years. That basically means that half your monthly investment is effectively stripped out of the plan.
With other products available here extracting similar amounts, it’s no wonder so many people are contacting The National complaining about being locked into poor-performing products.
Hence why we hosted The Money Round Table this week, where we invited six delegates to debate whether fixed-term savings and investment products have a place in a UAE resident’s investment portfolio.
With charges taking over half of what you put in – it appears it has no place at all. The calculation was based on an investor depositing US$1,222 or Dh4,500 a month into a 25-year-plan. For the RL360 product, that means total cumulative contributions are $366,600 over 25 years but the projected end value is only $352,343.46, assuming 4 per cent growth, which is less than you put in. This is because the plan’s cumulative charges are $189,459.97. This is the scenario for all the products in the table.
The costs include a high upfront commission fees and these are generally taken within the first two years of the product’s lifespan. The adviser and the life company are also funded via a myriad of fees such as the administration fee, plan fee, establishment charge, early discontinuance charge, premium protection cover charge … the list goes on.
All these fees must be paid in the event of an early exit, which is when most policy holders realise how much their plan is actually costing them.
So, if you have already bought into a plan, or are considering buying one, the table summarises the estimated future value and the charges as a percentage of the contributions made for the most prevalent products in the UAE marketplace.
arayer@thenational.ae
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Infiniti QX80 specs
Engine: twin-turbocharged 3.5-liter V6
Power: 450hp
Torque: 700Nm
Price: From Dh450,000, Autograph model from Dh510,000
Available: Now
In-demand jobs and monthly salaries
- Technology expert in robotics and automation: Dh20,000 to Dh40,000
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- Field engineer: Dh6,500 to Dh7,500
- Field supervisor: Dh9,000 to Dh12,000
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US PGA Championship in numbers
1 Joost Luiten produced a memorable hole in one at the par-three fourth in the first round.
2 To date, the only two players to win the PGA Championship after winning the week before are Rory McIlroy (2014 WGC-Bridgestone Invitational) and Tiger Woods (2007, WGC-Bridgestone Invitational). Hideki Matsuyama or Chris Stroud could have made it three.
3 Number of seasons without a major for McIlroy, who finished in a tie for 22nd.
4 Louis Oosthuizen has now finished second in all four of the game's major championships.
5 In the fifth hole of the final round, McIlroy holed his longest putt of the week - from 16ft 8in - for birdie.
6 For the sixth successive year, play was disrupted by bad weather with a delay of one hour and 43 minutes on Friday.
7 Seven under par (64) was the best round of the week, shot by Matsuyama and Francesco Molinari on Day 2.
8 Number of shots taken by Jason Day on the 18th hole in round three after a risky recovery shot backfired.
9 Jon Rahm's age in months the last time Phil Mickelson missed the cut in the US PGA, in 1995.
10 Jimmy Walker's opening round as defending champion was a 10-over-par 81.
11 The par-four 11th coincidentally ranked as the 11th hardest hole overall with a scoring average of 4.192.
12 Paul Casey was a combined 12 under par for his first round in this year's majors.
13 The average world ranking of the last 13 PGA winners before this week was 25. Kevin Kisner began the week ranked 25th.
14 The world ranking of Justin Thomas before his victory.
15 Of the top 15 players after 54 holes, only Oosthuizen had previously won a major.
16 The par-four 16th marks the start of Quail Hollow's so-called "Green Mile" of finishing holes, some of the toughest in golf.
17 The first round scoring average of the last 17 major champions was 67.2. Kisner and Thorbjorn Olesen shot 67 on day one at Quail Hollow.
18 For the first time in 18 majors, the eventual winner was over par after round one (Thomas shot 73).
BEETLEJUICE BEETLEJUICE
Starring: Winona Ryder, Michael Keaton, Jenny Ortega
Director: Tim Burton
Rating: 3/5
Results
4pm: Maiden (Dirt) Dh165,000 1,600m
Winner: Moshaher, Pat Dobbs (jockey), Doug Watson (trainer).
4.35pm: Handicap (D) Dh165,000 2,200m
Winner: Heraldic, Richard Mullen, Satish Seemar.
5.10pm: Maiden (Turf) Dh165,000 1,600m
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5.45pm: Handicap (D) Dh190,000 1,200m
Winner: Private’s Cove, Mickael Barzalona, Sandeep Jadhav.
6.20pm: Handicap (T) Dh190,000 1,600m
Winner: Azmaam, Jim Crowley, Musabah Al Muhairi.
6.55pm: Handicap (D) Dh190,000 1,400m
Winner: Bochart, Richard Mullen, Satish Seemar.
7.30pm: Handicap (T) Dh190,000 2,000m
Winner: Rio Tigre, Mickael Barzalona, Sandeep Jadhav.
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Starring: Ramy Youssef, Steve Carell, Jason Schwartzman
Director: Jesse Armstrong
Rating: 3.5/5
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The number of Chinese people living in Dubai: An estimated 200,000
Number of Chinese people in International City: Almost 50,000
Daily visitors to Dragon Mart in 2018/19: 120,000
Daily visitors to Dragon Mart in 2010: 20,000
Percentage increase in visitors in eight years: 500 per cent
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Francesco Totti's bio
Born September 27, 1976
Position Attacking midifelder
Clubs played for (1) - Roma
Total seasons 24
First season 1992/93
Last season 2016/17
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Where to donate in the UAE
You can donate to several registered charities through a “donation catalogue”. The use of the donation is quite specific, such as buying a fan for a poor family in Niger for Dh130.
The General Authority of Islamic Affairs & Endowments
The site has an e-donation service accepting debit card, credit card or e-Dirham, an electronic payment tool developed by the Ministry of Finance and First Abu Dhabi Bank.
You can donate online or order Smiles n’ Stuff products handcrafted by Al Noor students. The centre publishes a wish list of extras needed, starting at Dh500.
Beit Al Khair Society has the motto “From – and to – the UAE,” with donations going towards the neediest in the country. Its website has a list of physical donation sites, but people can also contribute money by SMS, bank transfer and through the hotline 800-22554.
Dar Al Ber Society, which has charity projects in 39 countries, accept cash payments, money transfers or SMS donations. Its donation hotline is 800-79.
Dubai Cares provides several options for individuals and companies to donate, including online, through banks, at retail outlets, via phone and by purchasing Dubai Cares branded merchandise. It is currently running a campaign called Bookings 2030, which allows people to help change the future of six underprivileged children and young people.
Those who travel on Emirates have undoubtedly seen the little donation envelopes in the seat pockets. But the foundation also accepts donations online and in the form of Skywards Miles. Donated miles are used to sponsor travel for doctors, surgeons, engineers and other professionals volunteering on humanitarian missions around the world.
On the Emirates Red Crescent website you can choose between 35 different purposes for your donation, such as providing food for fasters, supporting debtors and contributing to a refugee women fund. It also has a list of bank accounts for each donation type.
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Sheikh Mohammed bin Rashid Al Maktoum launched the Noor Dubai Foundation a decade ago with the aim of eliminating all forms of preventable blindness globally. You can donate Dh50 to support mobile eye camps by texting the word “Noor” to 4565 (Etisalat) or 4849 (du).
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Name: Abeer Al Shahi
Emirate: Sharjah – Khor Fakkan
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1 UAE 5 5 0 10
2 Qatar 5 4 1 8
3 Saudi 5 3 2 6
4 Kuwait 5 2 3 4
5 Bahrain 5 1 4 2
6 Maldives 5 0 5 0
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What: Emirates Airline Festival of Literature
When: Friday until March 9
Where: All main sessions are held in the InterContinental Dubai Festival City
Price: Sessions range from free entry to Dh125 tickets, with the exception of special events.
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Information: www.emirateslitfest.com
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Lowest Test scores
26 - New Zealand v England at Auckland, March 1955
30 - South Africa v England at Port Elizabeth, Feb 1896
30 - South Africa v England at Birmingham, June 1924
35 - South Africa v England at Cape Town, April 1899
36 - South Africa v Australia at Melbourne, Feb. 1932
36 - Australia v England at Birmingham, May 1902
36 - India v Australia at Adelaide, Dec. 2020
38 - Ireland v England at Lord's, July 2019
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42 - Australia v England in Sydney, Feb. 1888
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• Increase defence spending to 2.5% of GDP by 2027 but given “turbulent times it may be necessary to go faster”
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• Invest in the resilience of military space systems.
• Number of active reserves should be increased by 20%
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