Saving money can feel like a balancing act—you want security, but you also want growth. If you're looking for a structured, low-risk way to build wealth while earning more than a savings account, an endowment plan might be worth considering.
These plans combine disciplined savings, guaranteed returns, and potential bonuses, making them a popular choice for those who prefer certainty over risk.
But are they right for everyone? Endowment plans come with lock-in periods and specific payout structures, meaning they’re best suited for savers with clear financial goals—whether it’s planning for retirement, a child’s education, or a major life milestone.
They also sit somewhere between savings accounts, fixed deposits, and investment-linked products, offering more growth than traditional savings while being less risky than investments. Throughout this guide, we’ll break down how they work, who they’re best for, and how they compare to other financial tools you might be considering, including T-bills and Singapore Savings Bonds.
What is an endowment plan?
An endowment plan is a hybrid financial product that combines insurance protection with a structured savings component. It’s designed to help policyholders accumulate wealth over a fixed period while ensuring a safety net through life insurance coverage.
At its core, an endowment plan pays out a lump sum at maturity—usually after 3, 5, 10, 15, or 20 years. However, if the policyholder passes away before the plan matures, the policy’s death benefit is paid out to the beneficiaries. This dual purpose makes it a popular choice for those seeking disciplined savings with a layer of financial protection.
How does an endowment plan work?
When you pay a monthly premium, part of it goes toward life insurance coverage, while the rest is invested to generate returns. The split between insurance, costs, and savings varies by plan and is shown in your benefit illustration. For example, out of a $250 monthly premium, around $100 may be allocated to insurance, and the remaining $150 is directed into savings or investment funds managed by professionals.
Endowment policies are usually issued by life insurance companies and may be structured as standalone plans or as part of whole life insurance policies. In fact, many whole life plans in Singapore contain an endowment-like feature, which contributes to their higher premiums compared to term insurance.
Because of these investment and savings components, some people view endowment-linked whole life policies as more than just protection—they see them as long-term wealth accumulation tools.
What do endowment plan terms mean?
| Feature | What It Means |
|---|---|
| Premium | The amount you commit upfront. Short-term plans often require a single premium (e.g. S$10,000), while long-term plans may involve regular contributions. |
| Premium Type | Could be single (one-time payment) or regular (monthly, yearly). Limited-pay options allow shorter payment terms with longer coverage. |
| Policy Term | The duration of the plan. Short-term plans range from 2 to 6 years; long-term plans can go from 10 to 25 years or even whole life. |
| Capital Guaranteed | If held until maturity, you’ll get back at least what you paid in. This protection is void if the policy is terminated early. |
| Maturity Returns | The projected annualised return (e.g. 3% p.a.) upon maturity. May be fully guaranteed or include non-guaranteed bonuses. |
| Guaranteed Cash Value | The minimum sum you will receive at maturity, excluding bonuses. |
| Non-Guaranteed Bonuses | Additional returns based on insurer fund performance. Includes reversionary (accumulated yearly) and terminal bonuses (paid at maturity or death). |
| Participating Plan | A plan that lets you share in the insurer’s investment profits via bonuses. |
| Non-Participating Plan | A plan that pays only the guaranteed sum with no investment-linked bonuses. |
| Surrender Value | The amount you receive if you exit early. This is often less than what you've paid and could be zero in early years. |
| Insurance Coverage | Provides basic protection—typically 101% to 105% of premiums paid—against death or total and permanent disability (TPD). |
| Tranches | Short-term plans are often sold in limited-time tranches with fixed rates and availability. |
What are the types of endowment plans available in Singapore
Endowment plans in Singapore are not one-size-fits-all. They come in various structures depending on your savings preferences, investment goals, and desired policy duration.
Here’s a breakdown of the common types of endowment plans based on payment structure, term, investment participation, and flexibility.
1. Based on premium payment structure
Endowment plans can be funded either with a one-time payment or through regular contributions. Your choice depends on whether you prefer to invest a lump sum upfront or spread out your savings over time.
| Type | Description | Suitable For |
|---|---|---|
| Single Premium Endowment Plan | One-off lump sum payment at policy start | Individuals with idle capital seeking short-term returns |
| Regular Premium Endowment Plan | Monthly, quarterly, or annual payments throughout the term | Savers looking for discipline and long-term commitment |
2. Based on policy term
Whether you're planning for a near-term goal or a long-term milestone, the tenure of your plan should match your financial timeline.
| Type | Term | Funded By | Ideal Use Case |
|---|---|---|---|
| Short-Term Plan | 2–3 years | Usually single premium | Short-term savings or low-risk investment alternative |
| Long-Term Plan | 10–25 years | Typically regular premiums | Retirement, child’s university fund, wealth accumulation |
| Flexible Plan | Varies | Regular or single premium | Allows interim cash withdrawals for education or emergencies |
3. Based on investment participation
Some plans let you benefit from the insurer’s investment performance, while others offer fully guaranteed payouts.
| Type | Returns | How It Works | Risk Level |
|---|---|---|---|
| Participating Plan | Guaranteed + non-guaranteed bonuses | Linked to performance of insurer's participating fund | Moderate – depends on market performance |
| Non-Participating Plan | Fully guaranteed | Fixed maturity benefit set at purchase | Low – no exposure to investment risk |
4. Based on payment duration
Some plans let you finish paying premiums early while keeping your policy active till maturity.
| Type | Premium Duration | Policy Duration | Benefit |
|---|---|---|---|
| Limited Payment Plan | Fixed period (e.g. 5, 10, 15 years) | Longer than payment period | No need to pay premiums after payment term ends |
| Whole Life Endowment Plan | Pay till a certain age (e.g. 65 or 85) | Coverage till end of life | Suited for legacy planning or lifelong savings |
What is a short-term endowment plan?
With low interest rates offered by traditional bank accounts, more Singaporeans are turning to short-term endowment plans as a smarter way to grow idle cash. These plans are designed to deliver fixed returns over a few years—typically between 2 to 6—while offering a small layer of insurance protection.
Despite being issued by insurance companies, short-term endowment plans are better seen as structured savings products. You pay a one-time premium, lock in your money for the agreed term, and receive a guaranteed payout at the end—so compare the guaranteed rate with fixed deposits, T-bills, and Singapore Savings Bonds before you commit.
Many of these products are capital-guaranteed at maturity, which means your principal is protected if you stay invested for the full duration.
Should you consider one?
Short-term endowment plans strike a balance between safety and returns. They’re particularly suitable if:
- You want better interest than a fixed deposit but still want capital protection. Check the guaranteed rate first: it may not be higher.
- You have spare funds you won’t need in the short term.
- You want a simple, low-risk savings product with defined outcomes.
However, these plans still require commitment. If you withdraw before maturity, you may walk away with less than what you put in. Also, if interest rates rise during your holding period, your funds will be locked in and unable to benefit from higher-yielding options.
What are the best short-term endowment plans in Singapore, and which are open?
Short-term endowment plans are ideal for individuals who prefer liquidity and lower commitment. These plans often have a policy duration of 2 to 6 years and are typically funded through a one-time premium.
They offer guaranteed returns and are seen as fixed deposit alternatives for wealth accumulation over a short period.
Short-term plans: guaranteed vs non-guaranteed returns, and status
| Endowment Plan | Min Single Premium | Policy Term | Guaranteed Returns (p.a.) | Non-guaranteed Returns (p.a.) |
|---|---|---|---|---|
| DBS SavvyEndowment 23 | S$5,000 | 2 years | 1.44% p.a. | Up to 0.16% p.a. (up to 1.60% p.a. in total) |
| Great SP | S$10,000 | 2 years | 0.60% p.a. guaranteed return | NIL |
| Singlife Digital Saver II (closed) | S$20,000 | 3 years | 2.60% p.a. guaranteed | |
| Manulife Goal 2026 (I) | S$5,000 | 2 years | 2.91% in total at the end of policy year 2 (cumulative, not per year) | Maturity bonus of up to 0.32% of the single premium; Manulife quotes up to 1.60% p.a. combined |
| Tiq 3-year endowment plan (fully subscribed) | S$5,000 | 3 years | 3.56% p.a. guaranteed | |
| AIA Wealth Savvy IV | S$5,000 | 3 years | 2.80% p.a. guaranteed | |
| Etiqa Enrich Aspire VII (fully subscribed) | S$30,000 | 5 years | 2,01% p.a. guaranteed depending on lump sum or split payment |
* Please reach out to the respective insurer to confirm on the tranche availability
How to read the returns columns
- Guaranteed is fixed at purchase and paid if you hold to maturity. Non-guaranteed bonuses depend on the insurer's fund and can be lower or higher than illustrated.
- Per year or in total? Some insurers quote a total over the term. For example, Manulife Goal 2026 (I) states a guaranteed 2.91% at the end of policy year 2, which is a total, not 2.91% each year. On a S$5,000 single premium, that is a guaranteed gain of S$145.50 (S$5,000 x 2.91%), before any maturity bonus of up to 0.32% of the premium.
- Illustrated returns such as 4.25% or 3.00% are assumptions about the insurer's fund, not promises.
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What is a mid to long-term endowment plan?
Mid to long-term endowment plans are designed to help you build wealth gradually while providing a layer of insurance coverage.
Unlike short-term plans that mature in just a few years, these plans typically have a policy term ranging from 10 to 25 years or even 30 years —making them suitable for retirement planning, children’s education, or other long-term financial goals.
These plans operate mostly on a regular premium basis, meaning you commit to making monthly, quarterly, or yearly contributions for a set number of years.
Your premiums go toward both life insurance coverage and the insurer’s participating fund, which aims to deliver returns through long-term investments in bonds, equities, and other assets.
Should you consider a mid to long-term endowment plan?
A long-term endowment plan may be a good fit if:
- You’re saving for major milestones like retirement, your child’s university fees, or a future downpayment.
- You prefer forced savings discipline with a known time horizon and potential for upside.
- You want a plan that comes with capital guarantees (typically after a certain number of years), along with life insurance coverage.
That said, these plans are not flexible. Missing premium payments or surrendering the plan early can result in financial losses. You should only commit to a long-term endowment if you’re confident that you won’t need the funds in the short term.
What are the best long-term endowment plans in Singapore?
Long-term endowment plans serve larger financial goals like retirement or your child’s tertiary education. These plans offer both guaranteed and non-guaranteed returns, with many incorporating bonus mechanisms and capital guarantees after a few years.
| Endowment plan | Premium / payment term | Policy term | Guaranteed | Non-guaranteed (illustrated) |
|---|---|---|---|---|
| DBS SavvySpring (II) | S$2,381 a year for 6 years, or S$4,762 a year for 3 years | 12 years | Up to 3.19% p.a. | Accumulation rate of 3.00% or 1.50% p.a. at illustrated returns of 4.25% or 3.00% |
| AIA Smart Flexi Rewards (II) | 5, 10, 15–30 years | 15–30 years | Guaranteed yearly coupons (from the end of year 2 or 4, depending on payment term) and a guaranteed maturity amount; capital 100% guaranteed at the end of the term for 5-year and 10-year payment terms | Bonuses and accumulated coupons depend on the participating fund |
| AIA Smart Wealth Builder | Single, 5, 10, 15, 20 years | Matures at age 125 (last birthday) | Capital 100% guaranteed from the end of the 15th policy year (single, 5- or 10-year payment) or the 20th and 25th year (15- or 20-year payment), for the SGD (II) plan | Bonuses are non-guaranteed |
| GREAT Wealth Multiplier 3 | 5, 10, 15 years (or single premium) | To age 120 next birthday | Capital guaranteed from as early as the end of the 10th policy year (single premium), 15th (5- or 10-year payment) or 20th (15-year payment) | Reversionary and terminal bonuses, non-guaranteed; illustrated at 4.25% and 3.00% fund returns |
| OCBC GREAT Lifetime Payout 3 | At least 3 years (from S$10,000 a year) | Lifetime | Guaranteed payout of 0.85% p.a. from month 49 (annual premiums of S$30,000 or more); capital guaranteed from the end of the 3rd policy year | Up to 3.15% p.a. in total at an illustrated 4.25% return (up to 2.09% p.a. at 3.00%) |
| Etiqa Enrich Flex Plus | Single, 3, 5, 10, 15 or 20 years | Matures the year before age 125 | Guaranteed maturity yield of up to 1.66% p.a. | Up to 3.96% p.a. in total, including non-guaranteed bonuses, at an illustrated 4.25% return |
| Income Gro Saver Flex Pro | Single, 5, 10, 15, 20, 25 or 30 years | 10, 15, 20, 25, 30 years, or up till age 120 | Capital guaranteed at maturity (single premium and yearly regular premium) | Illustrated at a 4.25% long-term fund return (3.00% alternative); not guaranteed |
| PRUActive Saver III | Single, or 5 to 30 years | 10–30 years | Capital guaranteed at maturity | Bonuses are non-guaranteed; no illustrated return on page |
| China Taiping i-Saver8 | Annual premium for 2 years | 8 years | Capital guaranteed; up to 3.13% p.a. at maturity, as stated by China Taiping | None stated |
| GREAT Prime Rewards 3 | Single premium (from S$10,000) | 15 or 20 years, depending on variant (5+10, 0+20, 3+17, 5+15) | Capital 100% guaranteed from the end of the 5th policy year | Prevailing accumulation rate of 3.00% p.a., not guaranteed and can change. Up to 1.82x of the single premium at an illustrated 4.25% return (1.41x at 3.00%), for the (5+15) plan with premiums of S$100,000 or more |
| TM Nest Egg (II) (FlexiSaver) | 5, 10, 15 years | 15 to 30 years | Guaranteed monthly cash payout | Non-guaranteed monthly dividend during the payout period |
* Please reach out to the respective insurer to confirm on the tranche availability
How do endowment plans compare with T-bills, Singapore Savings Bonds, and fixed deposits?
A guaranteed endowment rate is fixed for the whole term, while T-bill yields reset at every auction and Singapore Savings Bond rates step up the longer you hold. Compare what you can lock in, how long, and what it costs to leave early.
| Option | Latest rate | Lock-in and access | Notes |
|---|---|---|---|
| Short-term endowment (open 2-year plans) | Guaranteed 0.60% to 1.44% p.a. (GREAT SP, DBS SavvyEndowment 23); Manulife Goal 2026 (I) guarantees 2.91% in total over 2 years | Locked for 2 years; early exit can return less than you paid | Plus possible non-guaranteed bonuses; rate fixed at purchase |
| 6-month T-bill | 1.92% (cut-off yield, 24 September 2026 auction) | 6 months | Next 6-month auction 8 October 2026; 1-year T-bill cut-off yield was 1.68% on 23 July 2026, next 1-year auction 15 October 2026 |
| Singapore Savings Bond (SBNOV26) | 1.67% in year 1; 2.45% average per year over 10 years | Redeem in any month with no penalty; apply by 27 October 2026 | SBOCT26: 1.65% in year 1; 2.32% average per year over 10 years. Minimum S$500; maximum holding S$200,000 |
| Fixed deposit | Varies by bank | Fixed tenure; early withdrawal terms vary | See our fixed deposit rates page for the latest rates |
| StashAway Simple™ and StashAway Simple™ Plus | Simple: projected 1.5% p.a. after fees. Simple Plus: yield to maturity of 2.7% (last updated 17 July 2026) after fees | No lock-in; withdrawals are not restricted | Not guaranteed. Neutral reference only; compliance to clear before publishing |
Data as of 7 October 2026.
Learn more in our guides to T-bills, Singapore Savings Bonds, and safe, low-risk investments.
How is an endowment plan different from an investment-linked policy (ILP)?
An endowment plan pays a guaranteed sum plus possible bonuses from the insurer's participating fund. An ILP puts your premiums into funds you choose, so its value moves with the market and there is no maturity guarantee.
| Aspect | Endowment plan | ILP |
|---|---|---|
| Returns | Guaranteed sum plus non-guaranteed bonuses | Depends entirely on the funds you choose |
| Risk | Lower: guaranteed value if held to maturity | Higher: value rises and falls with markets |
| Flexibility | Limited until maturity | Usually more choice, including fund switching |
| Suits | Savers who want certainty and a fixed goal | Investors comfortable with market swings |
Can you buy an endowment plan with SRS or CPF?
- SRS: several short-term plans accept SRS funds, for example DBS and OCBC list SRS as a payment option on their plan pages. SRS contributions qualify for dollar-for-dollar tax relief, subject to the annual cap of S$15,300 for Singapore citizens and PRs (S$35,700 for foreigners). Withdrawals after the statutory retirement age get a 50% tax concession. Withdrawals before it are subject to a 5% penalty and are fully taxable.
- CPF: CPF Board lists endowment policies as an option under the CPF Investment Scheme (CPFIS). Which accounts (OA, SA) and which plans qualify must be confirmed on CPF Board's site. Read our CPF Investment Scheme guide for how CPFIS works.
What happens if you surrender an endowment plan early?
You receive the surrender value, which is made up of guaranteed cash value and any vested bonuses. In the early years it is often less than the premiums you paid, and some plans pay nothing: Etiqa Enrich Aspire VII, for example, states no cash value on early termination. Any capital guarantee applies only at maturity.
- Find the guaranteed surrender value table in your policy illustration to see what you would get in each year.
- Check whether the non-guaranteed bonus part is included, and treat it as possible, not promised.
- Ask your insurer or adviser for a surrender quote in writing before you decide.
- Compare the quote with simply holding on: the guaranteed maturity value is often higher.
Guaranteed benefits, including declared bonuses once vested, are protected by the Policy Owners' Protection Scheme up to limits. Non-guaranteed benefits are not.
What are the pros and cons of endowment plans?
| Pros | Cons |
|---|---|
| Guaranteed return and, on many plans, capital guarantee at maturity | Your money is locked in; early exit can return less than you paid |
| Forced savings discipline with a known time horizon | Returns can trail alternatives such as T-bills, so compare before you commit |
| Life insurance cover alongside savings | Bonuses are non-guaranteed and can be lower than illustrated |
| Potential upside from bonuses on participating plans | Fixed rate cannot rise if market rates go up |
| Guaranteed benefits covered by the Policy Owners' Protection Scheme, up to limits | Plans are sold in limited tranches, so availability changes |
What should you check before committing to an endowment plan?
Endowment plans can offer the dual benefits of long-term protection and disciplined savings — but they’re not one-size-fits-all.
Before locking yourself into a policy that could span decades, it’s important to consider a few key aspects that affect both your returns and flexibility. Here's what you need to weigh up:
Capital guarantee at maturity
Some endowment plans offer 100% capital guarantee upon maturity, meaning you’ll get back at least what you paid in premiums. However, this guarantee only applies if you hold the policy until its full term.
Plans with capital guarantee are ideal for risk-averse individuals, but they may come with slightly lower potential returns compared to those with more market exposure.
Understand total distribution cost (TDC)
TDC refers to the portion of your premiums used to cover commissions and administrative costs — essentially the fee you pay for getting advice or purchasing through an advisor.
While it doesn’t affect your guaranteed benefits, high TDCs can reduce your non-guaranteed returns. Always review your policy’s benefit illustration to understand this cost breakdown.
Limited pay, lifetime cover
Some plans offer limited pay periods — for instance, paying premiums for just 10 or 15 years while enjoying coverage and capital growth till age 100. This structure is beneficial if you want to front-load your savings but still enjoy long-term benefits.
Surrender value — know your exit cost
Unlike term life insurance, endowment plans usually return some surrender value if you exit early. This value consists of a guaranteed portion and a non-guaranteed bonus portion. However, exiting within the first few years often results in a payout lower than your premiums paid, so only commit if you're confident you won’t need early access.
Reversionary vs terminal
Participating endowment plans offer non-guaranteed bonuses which enhance your returns over time. There are two main types:
- Reversionary bonus: Declared annually and added to your policy once vested.
- Terminal bonus: A one-time payout given when the policy matures or is surrendered.
These bonuses depend on the insurer’s investment performance and aren’t fixed. It’s wise to check historical bonus rates provided by your insurer for reference.
Think twice before early withdrawals
Some endowment plans allow partial withdrawals or cash payouts once your policy accrues value. However, frequent withdrawals can reduce your overall returns or result in policy termination. If the policy is meant for retirement or education funding, consider reinvesting your payouts for better compounding.
Frequently asked questions
Is an endowment plan capital guaranteed?
Most are, but only if you hold the plan to maturity. Plans that state a capital guarantee return at least the premiums you paid at maturity, and on some long-term plans the guarantee starts only after several policy years. If you surrender early, you can get back less than you paid, so check the guarantee start date.
Can I withdraw from an endowment plan before maturity?
You can surrender the plan, but you may receive less than the premiums you paid, and in the early years the surrender value can be low or nil. Some plans allow partial withdrawals or cash payouts once value builds up. Check the guaranteed surrender value table in your policy illustration before you commit.
Is an endowment plan worth it in 2026?
It depends on your timeline and need for flexibility. The open 2-year plans in our table guarantee less than the latest 6-month T-bill cut-off yield of 1.92% (24 September 2026), but they lock in a rate for the full term. T-bill yields reset at each auction. Compare guaranteed returns, lock-in, and exit costs, not just headline rates.
What is the difference between guaranteed and non-guaranteed returns?
Guaranteed returns are fixed when you buy the plan and paid if you hold to maturity. Non-guaranteed returns, such as reversionary and terminal bonuses, depend on the insurer's participating fund and can be lower or higher than illustrated. Always compare the guaranteed figure first, and treat illustrated bonuses as possible, not promised.
Can I buy an endowment plan with SRS or CPF?
Often yes for SRS: several short-term plans accept SRS funds, though terms differ by insurer. CPF Board lists endowment policies as an option under the CPF Investment Scheme (CPFIS). Eligibility depends on the specific plan and your CPF account, so confirm with the insurer or CPF Board before you apply.
Are short-term endowment plans available all year?
No. Insurers sell them in limited tranches with set rates, and a tranche can close when it is fully subscribed or the sales period ends. A plan listed today may be closed next month, and the next tranche can carry a different rate. Check the insurer's own page for current availability before you apply.
How is an endowment plan different from an investment-linked policy (ILP)?
An endowment plan pays a guaranteed sum plus possible bonuses from the insurer's participating fund, so the downside is limited if you hold to maturity. An ILP invests your premiums in funds you choose, and its value moves with the market with no maturity guarantee. Endowments suit certainty; ILPs suit investors comfortable with fluctuations.
