Best Savings Plans in UAE

Nov 19

Best Savings Plans in UAE

(Updated February 2019)

I am writing this article because as an independent financial advisor, I get asked frequently which are the Best Savings Plans in the UAE. The criteria I have used below reflect my own views, both as a customer myself with my own savings plans from different companies, as well as my experience as an independent financial adviser.

Local vs International Providers

When investing one’s hard earned money, I generally recommend considering international providers only. This is because they have the pedigree, experience and expertise to design products that perform well. Local providers are not recommended.

Also, make sure that the international provider you are evaluating is licensed to offer investment products in the U.A.E. This ensures that you have legal recourse should things go wrong.

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Licensed International Providers in the UAE

I have listed below providers of savings plans in the UAE who are licensed and whose products are regulated in the UAE.

  1. Assicurazioni Generali (closed to new business as of January 2019)
  2. Metlife International
  3. Zurich International Life
  4. Friends Provident International (Part of Aviva Group)
  5. Investors Trust S.P.C.

Types of Savings Plans in the UAE

There are mainly two types of savings plans in this market:

  1. Unit-linked savings plans based on mutual funds.
  2. Index linked savings plans that invest in stock indices.

Pros and Cons of Unit-linked Savings plans

  1. Shorter terms (as low as 5 years).
  2. Wide choice of mutual funds themes to choose from.
  3. Choice of funds is not always good as you have to select the right funds or rely on the knowledge of your adviser.
  4. Moreover the choice of funds has to be kept relevant with changing economic situations, i.e. the choice has to be reasonably correct to match changing markets.
  5. These plans are not capital protected.
  6. The returns on these plans are not guaranteed.
  7. These plans perform well only if held till maturity.

Pros and Cons of Index-linked Savings plans

  1. Terms tend to be longer than 10 years.
  2. Indices outperform fund managers over time.
  3. No control over where the money is invested as the money is invested directly in the indices.
  4. Recommended by Warren Buffett.
  5. No choice of funds to be made or changed.
  6. No timing the market.
  7. Capital protected
  8. Minimum yield assured (in most cases 140% is guaranteed in writing as a minimum)
  9. If the market performs better you get the full benefit.
  10. Catch - all the premiums have to be contributed without fail to avoid losing guarantee.
  11. Pre-funding allowed for upto 3 years.

Best Unit linked Savings Plans

In order of preference, based on flexibility and charges.

  1. Evolution (Investors Trust) - Investors Trust Evolution Review
  2. Wealth Builder (Metlife) - Metlife Wealth Builder Review
  3. Vista (Zurich International Life) - Zurich Vista Review
  4. Premier Advance (Friends Provident International) - Friends Provident Premiere Advance Review
  5. Vision (Assicurazioni Generali) - Generali Vision Review

Best Index-linked Savings Plan

  1. S&P 500 (Investors Trust) - Investors Trust S&P500 Index Review

Leave your comments and questions below, or contact me for personal advice.

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About the Author

Amit is an Independent Financial Advisor, based in Dubai since 1997. He is part of the prestigious ‘Million Dollar Round Table’ (MDRT), which is an elite club of the best financial advisors worldwide.

He has authored the ‘6-Step Financial Success Guide’, and the book ‘Creating, Preserving, Distributing Wealth’.

He helps business owners and professionals ‘Create A Second Income’ through investments.

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