Two pitfalls to avoid in your investments

So many people have fallen for these bad financial products. And they learned a painful lesson. It has been very costly for them.

Lesson 1.

Do not invest in structured deposit. They are structured to look attractive, but are usually quite deceptive. The product creator and distributor made high profit for themselves. Their large charges are hidden in the complicated structure. You will only find out after a few years. By that time, you will realise that most of the gains have been eaten away by the charges. If the market perform badly, you have to carry the loss.

Lesson 2.

Avoid investing through financial advisers. They will be able to find unit trusts that perform well in the past (from more than 300 unit trusts available in the market). The probem is that these unit trusts are NOT likely to perform well in the future. These unit trusts are likely to have high charges (2% to 3% per year). The financial adviser recommend them to you, because they get a trailer fee of 0.5% to 1% every year. This comes from your earnings.

WHAT IS THE BEST CHOICE FOR THE CONSUMER?

Invest in a large, well diversified fund with low charge. Less than 1% per annum. This is available from NTUC Income. Many people have benefited for it. Join them.