AXA Wealth Accelerate Review: Should you get this in 2022?

AXA Wealth Accelerate Review

Articles written are independent opinions, and are not affiliated/sponsored unless specifically mentioned.

axa wealth accelerate review

Table of Contents

AXA Wealth Accelerate is a regular premium, investment-linked policy (ILP) that speeds up your wealth build-up through several bonuses.

We’ve reviewed AXA Wealth Accelerate to help you decide if it is the right option for you.

Read on.

Criteria

  • Minimum entry age:
  • Life Assured: One month to 70 years
  • Policyholder: 18 to 99 years.
  • Minimum investment of $300

 

Coverage Period

The coverage lasts as long as the policy is still in force. In other words, it covers life up to 99 years.

General Features

Premium Allocation

Before we share with you the premium allocations, you’ll need to understand the initial contribution period (ICP) based on the Minimum Investment Period (MIP) you’ll be choosing.

Minimum Investment Period Initial Contribution Period
10, 15, 20 years First 36 months
25 years First 48 months
30 years First 60 months

AXA Wealth Accelerate comprises 2 accounts for premium allocation as shown in the table below;

Initial Units Account (IUA) Accumulation Units Account (AUA)
Regular Premium Regular Premium during ICP Regular Premium after ICP
Other Premiums N/A Top-Up Premium and Recurring Single

Premium (RSP) (if any)

The following allocations are held in the AUA account:

  • Power-up bonuses
  • Loyalty bonuses
  • Top-up premiums
  • Recurring single premiums
  • Regular premiums after the ICP period.

 

In contrast, the IUA accounts hold the following allocations;

  • Start-up bonuses
  • Regular premiums

 

Premium Payment Terms & Options

You can choose to pay;

  • Month
  • Semi-annually
  • Quarterly
  • Annually

 

The table below shows the minimum amount that you should pay depending on the payment frequency.

Payment frequency Minimum Investment Amount
Monthly S$300
Semi-annually S$1800
Quarterly S$900
Annually S$3600

Notably, AXA can change the minimum investment amount anytime during the policy.

Also, you cannot reduce the premium during the ICP.

Minimum Investment Period

AXA offers a flexible choice of the minimum investment period (MIP) which ranges from 10, 15, 20, 25, or 30 years.

Minimum Investment Period (Years) Maximum Entry Age 
10 70
15 65
20 60
25 55
30 50

Plan Flexibility

Top-ups and Recurring Single Premium

Top-ups and Recurring Single Premium (RSP) are allowed during the policy.

Tops ups are allowed in multiples of S$100 and the minimum top-up amount is S$5,000.

On the other hand, an RSP is allowed from S$100 per month. However, you can only exercise this in multiples of S$100.

Grace Period

AXA Wealth Accelerate allows a 30 day grace period from the regular premium due date. However, this excludes Top-up premiums and RSP.

In addition, dividends are not paid during the grace period.

Premium Holiday

Another feature of the AXA Wealth Accelerate plan is the Premium Holiday.

This allows you to stop making your payments while it’s still running should you want or need to temporarily do so.

Notably, the premium holiday is not allowed during the ICP if you fail to pay your regular premiums immediately after the grace period.

After the ICP to the end of the MIP, you can get a premium holiday for a maximum of 60 months.

However, you’ll have to forfeit your Power-Up bonuses.

After the end of the MIP, you will be able to get unlimited Premium Holidays.

Life Replacement Option

The Life Replacement Option allows you to replace the assured with their spouse or a child below 18 years old.

Therefore, your dependents can take over the policy and continue with the premium payments in case of demise during the MIP.

Partial Withdrawal

Partial withdrawals are allowed, with a minimum of $1,000 per withdrawal.

During the Minimum Investment Period, you may withdraw from the Accumulation Units Account at a charge.

From the end of the ICP to the end of the MIP, you will not be charged for partial withdrawals, at least for up to the first 5 withdrawals.

Subsequent requests, however, will incur a fee.

Withdrawals from the AUA and IUA are free after the MIP.

The maximum amount you can withdraw for each withdrawal is capped at 2 times the annualised regular premium.

Therefore, if you reduce your annual regular premium, this too will be capped at two times the revised amount.

As earlier mentioned, you’ll not receive Power-up and Loyalty bonuses in the next 12 months after a partial withdrawal.

Additionally, every partial withdrawal differs depending on your MIP period selected, as highlighted in the table below;

MIP 10 15 20 25 30
Maximum partial withdrawals allowed 2 2 2 3 5

To understand how this works, have a look at the Partial Withdrawal charges table below.

Partial withdrawal during the policy year Partial withdrawal rate
IUA AUA
During the ICP Not allowed 7%
After the ICP up to the end of the MIP Not allowed 7%
After the MIP There is no partial withdrawal fee There is no partial withdrawal fee

Regular Withdrawals

Regular Withdrawals are allowed after the end of the MIP as shown on the table below.

Frequency of the withdrawal Minimum amount allowed
Annual S$1200
Semi-annually S$600
Quarterly S$300
Monthly S$100

Protection

AXA Wealth Accelerate has multiple benefits including Death and Terminal Illness

Death Benefit

AXA Wealth Accelerate will pay the Death Benefit if death occurs before the policy anniversary close to the assured 60th birthday.

In this case, they will pay;

  • 101% of the total value
  • 15% of the total account value minus Top-ups and RSPs. As well, this amount is capped at S$500,000 minus any outstanding charges.

 

If death occurs on or after the policy anniversary to the insured’s 66th birthday, you will receive 101% of the Total Account Value minus any charges and outstanding fees.

Terminal Illness Benefit

The Terminal Illness Benefit applies upon diagnosis with a terminal illness while the policy is still running.

In this case, you will receive a lump sum amount of S$3 million in value or the Death Benefit, whichever is lower.

Having said that, the maximum TI Benefits on the life assured is capped at S$3 million.

Upon paying the entire Death Benefit, the policy comes to an end.

Key Features

AXA Wealth Accelerate offers rewards or bonuses throughout your investment journey.

Start-up Bonus

You can receive a Start-up Bonus of up to 200% of your annual premium throughout the ICP.

This will help you to get started on your investment journey.

The Start-up bonus is equal to the prevailing rate multiplied by the regular premium for the first policy year.

Here is a table to illustrate the Start-up bonus during the MIP.

Minimum Investment Period (MIP) 10  15  20  25 30
First-year rate 2% 15% 20% 25% 30%
Second-year rate 1% 25% 40% 40% 40%
Third-year rate 1% 25% 40% 40% 40%
Fourth-year rate 40% 40%
Fifth-year rate 50%
Sum 4% 65% 100% 145% 200%

Power-up Bonus

There is a Power-up Bonus of 1.3% of the Account Value from the 15th policy year up to the end of the MIP.

Power-up Bonus is equal to the prevailing rate per month multiplied by the current Total Account Value.

Notably, the rates are only for 20, 25, and 30-year MIPs, as shown in the table below.

Minimum Investment Period (MIP)  

10

 

15

 

20

 

25

 

30

Premium tier less than S$9,600 0.65% 1.00% 1.25%
Premium tier more than or equal to S$9,600 0.70% 1.05% 1.30%

Notably, you will not receive the power-up bonus for 12 months under the following circumstances;

  • When you partially withdraw from the policy
  • During premium reduction
  • During premium holiday

 

Loyalty Bonus

You can receive a Loyalty Bonus of up to 1.1% of the Account Value through the term of the policy beginning after the end of the MIP.

The Loyalty Bonus is calculated by multiplying the applicable rate per month by the current total account value.

Like the other bonuses, the applicable rate is based on the MIP, as shown below.

Minimum Investment Period (MIP)  

10

 

15

 

20

 

25

 

30

Premium tier less than S$9,600 0.00% 0.20% 0.60% 0.90% 1.10%

Like the power-up bonus, you will not receive the Loyalty Bonus for 12 months if you decide to partially withdraw.

Fund Offerings

The AXA Wealth Accelerate has over 90 unique funds from you to choose from and invests them directly into the fund.

AXA Wealth Accelerate Top 10 Performing Funds

The AXA Wealth Accelerate invests in unit trusts.

Name of Fund 5-Year Historical Average (%)
BlackRock GF World Technology A2 USD 29.46
Franklin Technology A Acc USD 26.34
AB FCP I – Sustainable US Thematic Portfolio AH SGD 20.01
Threadneedle Global Smaller Companies AE USD 17.82
Robeco Global Consumer Trends Equities D USD 17.68
Pictet Premium Brands HP SGD 17.33
Schroder ISF Taiwanese Equity A Acc NAV 16.81
Amundi Pioneer US Equity Fundamental Growth A USD 16.64
JPM Greater China A Acc NAV USD 16.13
Fundsmith Equity R Acc EUR 15.99
Pictet Security P USD 14.04

It is crucial to note that historical performance does not guarantee future returns. Furthermore, these are 5-year annualised returns. Always do your analysis or talk to a trusted financial advisor if you’re unsure.

Fees Involved

Besides the regular premiums, the policy attracts other charges or fees.

Account Maintenance Fee (AMF)

The AMF will be deducted from your IUA during the Minimum Investment Period.

However, this charge ceases to exist after the end of the MIP.

The monthly AMF equals 3.4% divided by 12 and then multiplied by the IUA Account Value as per the AMF due date.

Investment Management Fee (IMF)

The IMF is payable as long as the policy is still in force.

The monthly IMF is calculated as 1% divided by 12 months and then multiplied by the AUA value at the IMF due date.

Switching Fee

The company can impose a Switching Fee any time during the tenure of the notice through a one-month notice.

Currently, the charge is waived.

Redemption Fee

A Redemption Fee can be imposed by the company at any time during the notice period by giving one month’s notice. At present, this fee is waived.

Early Encashment Charge (EEC)

During the MIP, an Early Encashment Charge (ECC) can be applied on the IUA in certain events.

  1. During the policy’s surrender
  2. During policy’s termination due to other reasons other than terminal illness or death.
  3. If you exceed the premium holiday period and your regular premiums are due even after the grace period.
  4. If you fail to pay the regular premiums after the grace period from the policy commencement date for the following circumstances;
  • The initial 36 months for MIP 10,15,20.
  • Initial 48 months for MIP 25
  • Initial 60 months for MIP 30

 

In all the above cases, the EEC is equal to the prevailing EEC rate multiplied by the IUA’s Account Value at the point where the EEC is applied.

Bonus Recovery Charge (BRC)

The Bonus Recovery Charge is imposed on every regular premium reduction that occurs during the MIP.

In other words, it’s charged from your IUA when the reduced regular premium is formally applied.

Premium Charge

There are no fees charged for Top-up, regular single premium, and regular premium.

Fund Management Charge

This charge depends on the funds in your policy.

Compulsory Fees

Like most financial products, investment-linked policies (ILPs) come with costs. Typically these are commissions and fees which can add up and reduce the future investment value.

AXA Wealth Associate charges a 4.4% compulsory fee, consisting of AMF (3.4%) and the IMF (1%).

How much will I receive upon maturity of the AXA Wealth Accelerate?

I involved a financial advisor from AXA to help with the calculation.

In this case, assume you invest the minimum amount S$300 monthly for 30 years and let it compound for that period. In addition, the funds perform at 10% p.a with no partial withdrawals or premium holidays.

Here is a table and graph to illustrate what you will expect.

30 years investment horizon
Monthly premium $300
Premium payment term 30 years (360 months)
Total premiums paid S$108,000.00
Annual fund performance 10%
Fees charged 4.4%
Net fund performance in the 30 years 5.6%
Investment value S$266,886.59
Total interest earned S$158,886.59
ROI 59.53%

When comparing with other Investment Linked Policies(ILPs), it’s important to take note of the amount you want to invest, MIP, and payment frequency for a balanced opinion.

Because funds performances are hard to predict, you’ll find that different ILPs have varying returns.

Therefore, the rate of returns and fees charged are important aspects to consider when choosing an ILP.

My Opinion of the AXA Wealth Accelerate

AXA Wealth Accelerate is a great policy that allows you to accumulate wealth over a period of time and receive funds, including interest earned during your golden years.

The risks are less because it’s a long-term investment, and you can exercise financial discipline through savings.

Without a doubt, this policy will empower you to cater to your financial expenses in the future and live a better tomorrow.

I particularly like the 30 days grace period when it comes to regular premium payment options.

I feel that this allows the policyholder to plan and avoid having overdue payments.

The unlimited premium holiday option after the MIP is an excellent feature because you can start receiving your accumulated wealth at this time.

Another thing I like about this policy is the bonus feature which lets you enjoy interest on invested funds.

With the Start-Up Bonus, you can start reaping benefits early in the policy.

Unlike some policies that may have a longer MIP, the AXA Wealth Accelerate offers flexible MIP options of 10, 15, 20, 25, or 30.

Therefore, you don’t have to worry about the funds being held for long.

While I appreciate the multiple benefits offered by the AXA Wealth Accelerate, it lacks optional riders, which help in enhancing your coverage.

For instance, you may not enjoy premium waivers in case of an accident.

In addition, the minimum investment amount is S$300 per month which is higher than other policies on the market.

For example, Manulife InvestReady Wealth II and Great Eastern’s Great Wealth Advantage is S$200.

Another drawback is the 3.4% compulsory fees which is a bit steep when you compare it to other options.

No single policy is 100% excellent.

Furthermore, there are many options on the market, and deciding on the best can be challenging.

Our guide to the best investment plans in Singapore might help.

Otherwise, you can discuss with a financial advisor to help you decide on the best option that meets your needs.

References

https://www.axa.com.sg/savings-investments/axa-wealth-accelerate

https://myaxa-singapore.cdn.axa-contento-118412.eu/myaxa-singapore%2Fedf80f62-fa3a-4c0a-876d-2b915bb128ba_axa+wealth+accelerate+product+summary.pdf

Disclaimer: Each article written obtained its information from reliable sources and should be purely used for informational purposes only. The information provided by Dollar Bureau and its affiliated parties is not meant to be construed as financial advice. Dollar Bureau shall not be held liable for any inaccuracies, mistakes, omissions, and losses incurred should you act upon any information listed on this website. We recommend readers to seek financial planning advice from qualified financial advisors. 

Dollar Bureau is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for website owners to earn advertising fees by advertising and linking to amazon(.com, .sg, .ca etc) and any other website that may be affiliated with Amazon Service LLC Associates Program.

Follow us here:

Interested in
Financial Planning?

We have a FREE e-book for you to get started with. 

Other Useful Reads

Is your financial advisor recommending you this product?

Or are you interested to understand if this product is right for you?

Talk To A Financial Advisor in Our Network

Our strict selection process ensures that only the most unbiased financial advisors get to be part of it.

This means you get:

Fill up the form and you will be matched to the best financial advisor based on your needs.

Get Financial Advice Based On YOUR Needs

Our advisors can only provide you financial services if you are currently based in Singapore.

Is your financial advisor recommending you this product?

Or are you interested to understand if this product is right for you?

Talk To A Financial Advisor in Our Network

Our strict selection process ensures that only the most unbiased financial advisors get to be part of it.

This means you get:

Fill up the form and you will be matched to the best financial advisor based on your needs.

Get Financial Advice Based On YOUR Needs

Our advisors can only provide you financial services if you are currently based in Singapore.

Get updates on unbiased easy-to-digest content by joining our Telegram channel.