Friday, September 19, 2014

Chit Chat on BPI Save Up

In my last post, I briefly talked about my plan of opening up a BPI Save Up account because of its life insurance aspect. I was surprised at the number of comments I got regarding that bit in my rambling post because it seems as if a lot of people are also interested or are already using BPI Save Up.

The information online regarding BPI Save Up is pretty straightforward:

  • It uses an automatic savings system where you transfer a set amount of cash every month or twice a month from an existing BPI savings or checking account.
  • There is no required minimum deposit but the required minimum average daily balance is Php1,000. It earns an ASTOUNDING 0.5% in interest per annum. (source)
  • The only way to top it up is through online transfer from another BPI account.
  • You will not get an ATM card (to prevent the temptation of withdrawing your savings!), but you will get an Info card as evidence of your account and which your heirs can use to claim the life insurance.
  • It comes with a free life insurance from Philam Life Insurance which is equivalent to 5x your average daily balance of the past three calendar months before you croaked, but not to exceed Php2,000,000. There is also additional coverage of up to Php2,000,000 in the event of accidental death or accidental dismemberment. Again, the amount will be based on 5x your month to date average daily balance for the past three calendar months before your death.
I had a few questions though that weren't answered by the website, so I stopped by a BPI branch to interview a banker. She was able to answer most of my questions but didn't seem quite confident about the insurance aspect and had to consult with some higher up who in turn checked out the product information in her computer (From where I was seated, I could see them consulting some slides).

Anyway, since the life insurance is tied up with a savings account, my question was when I die and my heir wants to claim the insurance proceeds, can he claim it right away or will it be frozen subject to the payment of estate taxes? I know that bank accounts are automatically frozen upon the account holder's death and may only be released upon a go signal from the proper tax authority (local government unit ba?) that the estate taxes have been settled or that no estate tax is due. Since the life insurance is tied up with a savings account, will it be governed by those rules or will its being a life insurance prevail and be exempt from the freezing of assets (assuming that the beneficiary is irrevocable)? Maybe someone out there knows?

Also, how do I get to name my beneficiary? I just opened a BPI Save Up account using my BPI Express online account and there's no option there on how you can name your beneficiary. Is it assumed that my beneficiary is my legal heir? What if I want to bequeath the insurance proceeds to some charity I'm supporting? And how can I give my beneficiary irrevocable status so that the insurance proceeds won't be covered by estate taxes?

I hope these questions will be finally answered when I receive my information card.

Personally, I think it's a good idea to park our emergency funds with BPI Save Up because it pretty much functions like a regular savings account so the money is relatively easy to access,* but at the same time, there's a life insurance component that I can rely on as an additional source of protection.

The ideal is that your salary is remitted through a BPI account and so you just automate a transfer every two weeks or every month. By sweeping a set amount directly into your savings account on a regular basis, you build up your war chest without lifting a finger and before you know it, you already have a pretty sum tucked away! 

In our case, I use my BPI account to house our emergency funds and since we are rebuilding it, I set the transfer to a very slow Php1,000 every month and will ramp it up when our emergency funds have substantially recovered. I don't plan to transfer all our emergency funds to BPI Save Up though, maybe just put Php200,000.00 there to ensure a Php1,000,000 life insurance coverage and maintain the regular account with a month's worth of expenses for easy access. But we are still very far away from our target amount for emergency funds, so in the meantime, ipon-ipon muna.

Hope you're all doing well during this wet and stormy day!


*To withdraw money from BPI Save Up, you transfer the amount you need online to your BPI account and then withdraw it from there.

14 comments:

  1. Hi ma'am Jill , parang interesting din tong BPI save up. Thanks po sa pag-post :)

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  2. Hi Jill, i've been waiting for this post. hahaha ;) i asked how to update the name of beneficiary and status (whether irrevocable or not) at the branch near us. The manager says we can sent a formal letter to them if we want some changes in this part of the insurance. Maybe i'll try this when i have opened my own save up account. Ang come-on naman nya sa akin ay ung hindi requirement ang magpa medical exam. ;)

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  3. Interesting! My husband has a BPI savings account, pag-applyin ko nga sa Save Up + Insurance na yan. Sayang ang 2M! :)

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  4. Hi. Were you able to get the answer on your questions reg the life insurance part of it like the irevocable status of the beneficiaries etc. Im also interested to open a Save-Up acct. Thanks. ��

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    1. I'm still waiting for my info. card but someone told me that she availed of a similar product from BPI Family and the insurance is treated separately from the savings account. So even if the savings account is frozen subject to the payment of estate taxes, the beneficiary will get the insurance proceeds right away.

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  5. Hi. By any chance, would you know if it's possible to open the SaveUp account in my mom's name even if it's tied to my regular BPI savings account?

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    1. I don't think that's possible. The BPI Save Up account is vetted through your own personal account, so opening it in another person's name will not fly.

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  6. Hi, I've applied mine and there is a form that I've filled up for my dependent. I am not sure though for those who registered online.

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    nhengswonderland.blogspot.com

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    1. There are default beneficiaries. If you want to assign someone outside of the default list (i.e. spouse, children, parents) then your application will have to go through the underwriters first.

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  7. Just a question: can i still withdraw (from the bank, not atm of course), just like that in a regular savings account?

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    1. No, you can't withdraw your Save Up savings through the bank. What you can do is to transfer money online from your Save UP account to your regular BPI account and then withdraw from your regular BPI account.

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  8. I just opened mine today and I was asked to choose between high interest or insurance. This means you can't have both. High interest fits me as I'd like my savings fluid. Just don't want to see it on my main account so would like it transferred immediately to another account thus lowering the chance of spending them all.

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    1. How high is high interest in a savings account? 1% p.a.? 0.75% p.a.? Net of withholding tax pa yan right?

      And I don't understand how the insured account under BPI Save Up is not "fluid", you can easily transfer funds from the insured account to your regular account using online banking, and then withdraw it from your regular bank account using an ATM or over the counter if the ATM is not available.

      Maybe you can explain some more? This seems to be a new feature of BPI Save Up.

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