Manulife FlexiRetire: A New Participating Endowment Plan

Overview

Manulife FlexiRetire is a regular-premium participating endowment plan designed primarily for retirement income planning. The policyholder selects their premium payment term (5, 10, 15, or 20 years), desired retirement age (between 50 and 70), guaranteed monthly income amount, and income payout period (10, 15, or 20 years). Monthly retirement income begins one month after the policy anniversary following the chosen retirement age, with a maturity benefit payable at the end of the payout period.

The plan includes death and terminal illness coverage, premium waivers on total and permanent disability, a terminal cancer benefit, and an additional 100% guaranteed monthly income during the payout period if the life insured is diagnosed with specified disability conditions or illnesses. It participates in the performance of the insurer's participating fund through non-guaranteed bonuses.

How It Compares

At a common basis of age 35, male, non-smoker, with a $10,000 annual premium, Manulife FlexiRetire shows a guaranteed surrender value at year 20 of $48,702. This compares with TM Nest Egg (II) (FlexiSaver) at $19,092 on the same basis. However, coverage terms differ significantly: FlexiRetire's coverage term is 31–35 years, while TM Nest Egg (II) runs 21–25 years and both PRUIndex Income Boost and Tiq CashSaver run 11–15 years.

The total expense ratio at 5 years for FlexiRetire is 2.40%, notably higher than TM Nest Egg (II) at 0.58% and Tiq CashSaver at 1.93%, though slightly lower than PRUIndex Income Boost at 2.27%. The participating fund's net investment return over 3 years is 3.63%, with 5- and 10-year figures not available. Illustrated surrender values for a $2,500 annual premium show $24,314 at year 20 (projected up to $24,783), but decline to $18,104 at year 30 (projected up to $18,988), reflecting the payout phase. Projected yield to maturity ranges from 2.36% to 3.56% per annum.

Pros

• Flexible design: choice of premium term, retirement age, guaranteed monthly income, and payout period
• Payout period can be changed (subject to conditions) if retirement needs shift
• Built-in protection: death, terminal illness, TPD premium waiver, terminal cancer benefit, and disability income benefit
• Option to accumulate retirement income at prevailing interest rate (currently 3% p.a., non-guaranteed)
• Strong insurer credit ratings: AA- (S&P), A1 (Moody's), AA- (Fitch)
• No underwriting required

Cons

• Higher expense ratio (2.40% at 5 years) than some peers, which may weigh on returns
• Projected yield to maturity of 2.36%–3.56% p.a. is modest
• Surrender value declines after year 20 as payouts commence
• Non-guaranteed bonuses mean actual returns may differ from illustrations
• Not eligible for SRS or CPFIS premium payments
• Distribution cost of $1,687 on a $2,500 annual premium is significant relative to the outlay

Who It May Suit

Manulife FlexiRetire may suit individuals seeking a structured retirement income solution with flexibility in timing and payout, who also value the embedded protection benefits. The ability to choose retirement age between 50 and 70 and adjust the payout period offers adaptability. However, those prioritising lower costs or higher potential returns may find the expense ratio and projected yields less compelling compared with alternatives like TM Nest Egg (II). It is not designed for CPF or SRS funding.

This is general information based on CompareFIRST.sg data, not financial advice. Premiums and features can change; please verify with the insurer or a MAS-licensed financial adviser before making any decision.