Subscribers of M1 and Singtel can call a taxi by sending a SMS with TAXI (6 digit postal code) to 79797. For example, if your home is at postal code 809744, you can send TAXI 809744.
Subscribers of Starhub do not need to send the postal code, as their location can be picked up automatically. But, they can also send the postal code if they wish.
The taxi booking fee is $1.50 (off-peak hours) and $2.50 (peak hours). This system is on trial for the next few weeks.
More details in www.easysearch.sg/tabs
Tan Kin Lian
Friday, April 30, 2010
Cost of living
Read this article by Seah Cheang Nee.
My comment
The big swings in the economic performance is bad for most people who watch on the sidelines and see prices move beyond their comprehensive, let alone control. However, they do benefit the wealthy, who can afford to make more profit.
My comment
The big swings in the economic performance is bad for most people who watch on the sidelines and see prices move beyond their comprehensive, let alone control. However, they do benefit the wealthy, who can afford to make more profit.
Investors of Pinnacle Notes
I am told that several series of Pinnacle Notes have gone burst and the remaining series are nearly burst, i.e. market value less than 1%. Regardless of the series that you hold, you can join the legal action to sue Morgan Stanley in US Courts. This is done on a contingency fee basis, i.e. the US lawyer will only charge their fees and expenses, if the case is successful. You do not need to pay any fees, if it is unsuccessful.
Send an e-mail to tkla.km@gmail.com giving your name, e-mail address, mobile phone, series and amount invsted.
Send an e-mail to tkla.km@gmail.com giving your name, e-mail address, mobile phone, series and amount invsted.
CPF Life Annuity
Dear Mr. Tan
I read an article (link from your blg) about the pros and cons of annuities. It seems that the cons are overwhelming. What is your opinion about CPF Life annuity?
REPLY
The cons apply mostly to annuities sold by comercial insurance companies, where the charges are high and the consumer does not get a fair return on the annuity. These negative points do NOT apply to CPF Life, as it is runned on a mutual basis (i.e. the CPF does not run it to make a profit), and any surplus is distributed fairly among the annuitants.
This is explained in my book, Practical Guide on Financial Planning. You will also find other tips that are benefiicial to people approaching retirement.
I read an article (link from your blg) about the pros and cons of annuities. It seems that the cons are overwhelming. What is your opinion about CPF Life annuity?
REPLY
The cons apply mostly to annuities sold by comercial insurance companies, where the charges are high and the consumer does not get a fair return on the annuity. These negative points do NOT apply to CPF Life, as it is runned on a mutual basis (i.e. the CPF does not run it to make a profit), and any surplus is distributed fairly among the annuitants.
This is explained in my book, Practical Guide on Financial Planning. You will also find other tips that are benefiicial to people approaching retirement.
Compensation for Pinnacle Notes
Hi Mr Tan,
I have purchased $10k of Pinnacle Notes Series 7. The current value is 0.01% I was offered 30% compensation. Should I accept or reject the compensation? Can I join the legal action after accepting compensation?
REPLY
You should accept a flat 30% compensation, WITHOUT handing over your notes, and WITHOUT deduction of interest. If interest is deducted, then the net compensation is quite small, so there is no point in getting this compensation. If you get compensation, you can still join the class action, but you must still hold the notes. Don't hand it over to the distributor.
I have purchased $10k of Pinnacle Notes Series 7. The current value is 0.01% I was offered 30% compensation. Should I accept or reject the compensation? Can I join the legal action after accepting compensation?
REPLY
You should accept a flat 30% compensation, WITHOUT handing over your notes, and WITHOUT deduction of interest. If interest is deducted, then the net compensation is quite small, so there is no point in getting this compensation. If you get compensation, you can still join the class action, but you must still hold the notes. Don't hand it over to the distributor.
Renewal of motor insurance
Hi Mr Tan,
I have 2 cars under my name. The first car was borrowed to a friend who then disappeared together with the car. I filed a claim for total loss. The second car was involved in an accident while going straight. Another car beat the red light and crash onto my car. This case is still being pending investigation. According to a witness on site, the other car is at fault.
Due to the claim for total loss, I am not able to renew the insurance from any insurer as the road tax is overdue. Can you advice me on what to do?
REPLY
You can buy third party insurance, which covers only claims by third party. It will not cover damages or loss of your vehicle. You can take the risk on your own. Your insurance compnay should be prepared to insure you on third party insurance. If not, you can try a few other insurance companies. If they all refuse, you can seek assistance from the Land Transport Aurhority and MAS.
I have 2 cars under my name. The first car was borrowed to a friend who then disappeared together with the car. I filed a claim for total loss. The second car was involved in an accident while going straight. Another car beat the red light and crash onto my car. This case is still being pending investigation. According to a witness on site, the other car is at fault.
Due to the claim for total loss, I am not able to renew the insurance from any insurer as the road tax is overdue. Can you advice me on what to do?
REPLY
You can buy third party insurance, which covers only claims by third party. It will not cover damages or loss of your vehicle. You can take the risk on your own. Your insurance compnay should be prepared to insure you on third party insurance. If not, you can try a few other insurance companies. If they all refuse, you can seek assistance from the Land Transport Aurhority and MAS.
Good government advocacy
Read this article.
Quote
Singapore has also endorsed the principles of governance based on an accountable and transparent government, long-term orientation and social justice.
Unquote
Quote
Singapore has also endorsed the principles of governance based on an accountable and transparent government, long-term orientation and social justice.
Unquote
Election into Parliament
Read this article by Yoong Siew Wah.
My comment
I prefer a system where every constituency elects its own member of Parliament. I do not like the changes to the Constitution that were made during the last 20 years, especially the concept of GRC. It makes our system quite complicated and reduces the accountability of the elected person to the voters.
My comment
I prefer a system where every constituency elects its own member of Parliament. I do not like the changes to the Constitution that were made during the last 20 years, especially the concept of GRC. It makes our system quite complicated and reduces the accountability of the elected person to the voters.
Loss of NRIC
Many office buildings require the visitors to hand over the NRIC in exchange for a visitor pass. This is troublesome for the visitor. There is the risk that the visitor may forget to collect back the NRIC or may misplace it after receiving it back. This has happened to me before and has occurred again recently. I have now lost my NRIC. I spent a lot of time looking for it, without success. Now, I have to apply for a new NRIC.
I do not know how keeping a person's NRIC helps to improve security in a building. It is also unfair to ask the visitor to hand over the NRIC in exchange for a visitor's pass.
Tan Kin Lian
I do not know how keeping a person's NRIC helps to improve security in a building. It is also unfair to ask the visitor to hand over the NRIC in exchange for a visitor's pass.
Tan Kin Lian
Calling taxi by SMS
This new service will be on public trial from Friday 30 April (earlier trial on 26 April was shelved due to technical problem).
It will involve customers who hold a Starhub mobile phone. To get a taxi, use your Starhub mobile phone and send TAXI to 79797. The taxi booking fee is $1.50 (off peak hours) and $2.50 (peak hours). It is $1 cheaper than the normal type of booking.
If a taxi is available, you will get a SMS. The taxi driver will call you by mobile phone to ask for the pick up point. If no taxi is available for 10 minutes, you will be removed from the Queue, and a SMS will be sent to you.
Watch this video for an explanation of how the system operates. You can also visit this website. (About 100 taxis have registered for this service)
Tan Kin Lian
It will involve customers who hold a Starhub mobile phone. To get a taxi, use your Starhub mobile phone and send TAXI to 79797. The taxi booking fee is $1.50 (off peak hours) and $2.50 (peak hours). It is $1 cheaper than the normal type of booking.
If a taxi is available, you will get a SMS. The taxi driver will call you by mobile phone to ask for the pick up point. If no taxi is available for 10 minutes, you will be removed from the Queue, and a SMS will be sent to you.
Watch this video for an explanation of how the system operates. You can also visit this website. (About 100 taxis have registered for this service)
Tan Kin Lian
Thursday, April 29, 2010
Pros and Cons of Annuities
Read this article for the pros and cons of annuities. You can read about annuities, in the context of Singapore, from my book, Practical Guide on Financial Planning. My book also gives you an alternative on how to manage your lifestime savings, by investing in a low cost investment fund and making regular withdrawals.
Order Tangram book online now
The tangram book is now available. This video shows tips on solving the tangram puzzle. You can order the tangram book ($6) here.
Town councils and Pinnacle Notes
I need to know which town councils invested in the Pinnacle Notes. If you have the details, please send email to kinlian@gmail.com indicating:
- Name of town council
- Pinnacle Notes - series and amount invested
Wednesday, April 28, 2010
Miscellaneous Offences Act
I met Ms Jaslyn Go. She told me that she was charged for distributing flyers on a National Day. Other people distributing flyers were not charged. On my request, she gave me more details of this event.
I wonder what type of campaign or cause is subject to an offence under the Act. What about a campaign against ill treatment of animals? Or to promote a Green Earth?
I wonder what type of campaign or cause is subject to an offence under the Act. What about a campaign against ill treatment of animals? Or to promote a Green Earth?
2010 World Expo in Shanghai
Some photos of the World Expo, opening in Shanghai soon.
My comment
My first vist to Shanghai was 20 years ago. It was under-developed, poor and dirty. There were few cars on the road. How much has Shanghai changed in 20 years. It is a marvel!
My comment
My first vist to Shanghai was 20 years ago. It was under-developed, poor and dirty. There were few cars on the road. How much has Shanghai changed in 20 years. It is a marvel!
Al Jazeera
Read this article about the coverage of Al Jazeera on the homeless in Singapore and the rebuttal by the Minister for Community Development.
Equality
Our National pledge emphases the principle of equality. A person is entitled to equal treatment in our society and should not be discriminated based on race, religion, gender or age. They are entitled to equal opportunity under a system based on meritocracy.
However, the concept of equality is subdued in a capitalist, free market system where people with the power and the money enjoy "more than equal" treatment. They can take advantage of the weak and the poor who do not have the financial resources to challenge injustice through the law courts.
Well-off parents can afford private tuition to their children to perform well in their studies and earn a scholarship and a good career in business or government. It is difficult for children from poor families to meet this competition, although some of them are able to overcome the obstalces and have done well.
To reduce the disadvantages faced by the poor, we need national policies to achieve the following goals:
Tan Kin Lian
However, the concept of equality is subdued in a capitalist, free market system where people with the power and the money enjoy "more than equal" treatment. They can take advantage of the weak and the poor who do not have the financial resources to challenge injustice through the law courts.
Well-off parents can afford private tuition to their children to perform well in their studies and earn a scholarship and a good career in business or government. It is difficult for children from poor families to meet this competition, although some of them are able to overcome the obstalces and have done well.
To reduce the disadvantages faced by the poor, we need national policies to achieve the following goals:
- provide decent income through a minimum wage system
- provide social security for old age
- provide affordable health care
- provide quality education to all, and not dependent on private tuition
- strong regulation and enforcement to prevent cheating and exploitation of consumers
Tan Kin Lian
Social democracy
Read this explanation of social democracy.
My comments
According to this defination, the social democrats are more towards the center compared to democratic socialists.
My comments
According to this defination, the social democrats are more towards the center compared to democratic socialists.
Tuesday, April 27, 2010
Read the benefit illustration
I get requests from the public for my views on whether a certain insurance product is suitable for them. I advise them on the following:
a) Ask the agent to provide the benefit illustration to you
b) Ask the agent to explain the full contents of the benefit illustration
c) Insist on a clear explanation on every item in the benefit illustration
d) No not buy the policy until you are convinced that it clearly meets your needs and provide good value for money.
e) Look at the distribution cost and effect of deduction (as explained in my book on financial planning)
I find that most life insurance policies provide poor value as an investment product and should be avoided. I have looked at many benefit illustrations and they tend to confirm my general impression that these products are:
a) high cost
b) give poor value to consumers
c) have a lot of vague and unreliable projections
The only ife insurance policy that you should buy are term insurance for a duration of up to 25 years. These points are explained in my book. I urge you to read my book, rather than ask me to give my views peculiar to the products that is being sold to you.
You can buy my books online at http://www.easysearch.sg/
Tan Kin Lian
a) Ask the agent to provide the benefit illustration to you
b) Ask the agent to explain the full contents of the benefit illustration
c) Insist on a clear explanation on every item in the benefit illustration
d) No not buy the policy until you are convinced that it clearly meets your needs and provide good value for money.
e) Look at the distribution cost and effect of deduction (as explained in my book on financial planning)
I find that most life insurance policies provide poor value as an investment product and should be avoided. I have looked at many benefit illustrations and they tend to confirm my general impression that these products are:
a) high cost
b) give poor value to consumers
c) have a lot of vague and unreliable projections
The only ife insurance policy that you should buy are term insurance for a duration of up to 25 years. These points are explained in my book. I urge you to read my book, rather than ask me to give my views peculiar to the products that is being sold to you.
You can buy my books online at http://www.easysearch.sg/
Tan Kin Lian
Valuation of a property
This writer said that the bank officer indicated that the valuer will value the property at a higher price to get a bigger loan.
http://www.straitstimes.com/STForum/OnlineStory/STIStory_519799.html
My comment
The buyer should avoid paying a high price for the property as this means a higher monthly repayment over many years. Pay a price that is within your earning capacity (i.e. not more than 5 years of your family income). This is explained in my book, Practical Guide on Financial Planning.
http://www.straitstimes.com/STForum/OnlineStory/STIStory_519799.html
My comment
The buyer should avoid paying a high price for the property as this means a higher monthly repayment over many years. Pay a price that is within your earning capacity (i.e. not more than 5 years of your family income). This is explained in my book, Practical Guide on Financial Planning.
Experience with Property Agent
Dear Mr Tan,
The property market here is so sh.... lately. I relate to you of my latest experience with one of the agents from a well known real estate company.
I called one of their agents to ask for a particular new condo in a hot area which my son is interested in.This agent called me and lied to me that he has a unit and quoted me a unit price which I feel was quite attractive. We then arrange for an appointment to meet at the site, but this is all bxxxx, as he does not have the unit but want to test the demand for this place. They want to escalate the market.
Very nicely, he fixed an appointment with me, but when the day comes he called me to say that the demand is overwhelming, the price he quoted earlier is no longer valid and he cannot deliver, his colleagues have sold the units in this locality at a much higher price. Please help everybody not to fall into this kind of trap by the housing estate agents.
ET
The property market here is so sh.... lately. I relate to you of my latest experience with one of the agents from a well known real estate company.
I called one of their agents to ask for a particular new condo in a hot area which my son is interested in.This agent called me and lied to me that he has a unit and quoted me a unit price which I feel was quite attractive. We then arrange for an appointment to meet at the site, but this is all bxxxx, as he does not have the unit but want to test the demand for this place. They want to escalate the market.
Very nicely, he fixed an appointment with me, but when the day comes he called me to say that the demand is overwhelming, the price he quoted earlier is no longer valid and he cannot deliver, his colleagues have sold the units in this locality at a much higher price. Please help everybody not to fall into this kind of trap by the housing estate agents.
ET
US Congress - Goldman Sachs
Mr. Tan Kin Lian,
There is another more interesting news on the Goldman investigation. The e-mail record of Fabrice Tourre is quite telling. He is the 31-year old nicknamed "Fabulous Fab" who brokered the deal. You may read the link (http://money.cnn.com/2010/04/26/news/companies/Tourre_Goldman/index.htm)
Quote
In an even more blunt description, Tourre calls the CDOs he produced "intellectual masturbation" and likens himself to Dr. Frankenstein. "When I think that I had some input into the creation of this product (which by the way is a product of pure intellectual masturbation, the type of thing which you invent telling yourself: 'well, what if we created a 'thing', which has no purpose, which is absolutely conceptual and highly theoretical and which nobody knows how to price?") it sickens the heart to see it shot down in mid-flight...It's a little like Frankenstein turning against his own inventor ;)"
Unquote
From CASHEW NUT
There is another more interesting news on the Goldman investigation. The e-mail record of Fabrice Tourre is quite telling. He is the 31-year old nicknamed "Fabulous Fab" who brokered the deal. You may read the link (http://money.cnn.com/2010/04/26/news/companies/Tourre_Goldman/index.htm)
Quote
In an even more blunt description, Tourre calls the CDOs he produced "intellectual masturbation" and likens himself to Dr. Frankenstein. "When I think that I had some input into the creation of this product (which by the way is a product of pure intellectual masturbation, the type of thing which you invent telling yourself: 'well, what if we created a 'thing', which has no purpose, which is absolutely conceptual and highly theoretical and which nobody knows how to price?") it sickens the heart to see it shot down in mid-flight...It's a little like Frankenstein turning against his own inventor ;)"
Unquote
From CASHEW NUT
A social democracy
Some commenters in my blog described Mr. Lee Kuan Yew as a "communist". This description is not appropriate. Mr. Lee has fought against the communist after becoming prime minister of Singapore. His policy has always been anti-communist. He has put many alleged communists under detention without trial for as up to three decades.
One of the detainee is Dr. Lim Hock Siew. I first recognised this name on the signboard of a clinic in Balestier Road, near where I lived. At that time, I knew that Dr. Lim was detained because he was a member of the Barisan Socialis. I did not know of his background then.
Recently, I read an article about Dr. Lim after he was released from detention. He explained that his philosophy was for social justice. He advocated giving the people better wages, living conditions and a better life. They are the same type of values that I am advocating now. If this is what the communists advocate, it is not that bad after all.
http://www.youtube.com/watch?v=dqhr4wxUFws
Many people associate communism with oppressive regimes that are found in some countries around the world. But oppressive regimes can also be found in so-called democratic countries where the leaders abuse the state and military powers to retain their political dominance. The types of abuse vary in degree - in some cases they are subtle and in other cases, they are blatant.
We can also see countries that allow democracy adn free expression to get out of hand, leading to a breakdown of law, order and authority. This is also to be avoided.
My preference is a "social democracy". It is a truly democratic society where the will of the people is respected and the government is elected freely. The government promotes social justice through the regulation of the economy to promote a fairer distribution of wealth and opportunity and to prevent excessive accumulation of wealth by a small segment of the people, often by immoral means.
There are many examples of social democracies that have succeeded to give a good life to the people and have a high ranking in the quality of life indicators. They include several countries in Scandanivia and Europe, Canada and Australia. They become the top choice for migrants.
Tan Kin Lian
Quote from Lim Hock Siew's video
The future of socialism
After 50 years when the club was formed, the socialist movement all over the world has suffered a lot of setbacks and even defeats and some wonder whether we are still relevant. The recent economic crisis, the recent financial crisis, has once again exploded the corruption and immorality of the capitalist system and feel that human beings should deserve something better than a aystem that is generated by greed and by corruption,.
One of the detainee is Dr. Lim Hock Siew. I first recognised this name on the signboard of a clinic in Balestier Road, near where I lived. At that time, I knew that Dr. Lim was detained because he was a member of the Barisan Socialis. I did not know of his background then.
Recently, I read an article about Dr. Lim after he was released from detention. He explained that his philosophy was for social justice. He advocated giving the people better wages, living conditions and a better life. They are the same type of values that I am advocating now. If this is what the communists advocate, it is not that bad after all.
http://www.youtube.com/watch?v=dqhr4wxUFws
Many people associate communism with oppressive regimes that are found in some countries around the world. But oppressive regimes can also be found in so-called democratic countries where the leaders abuse the state and military powers to retain their political dominance. The types of abuse vary in degree - in some cases they are subtle and in other cases, they are blatant.
We can also see countries that allow democracy adn free expression to get out of hand, leading to a breakdown of law, order and authority. This is also to be avoided.
My preference is a "social democracy". It is a truly democratic society where the will of the people is respected and the government is elected freely. The government promotes social justice through the regulation of the economy to promote a fairer distribution of wealth and opportunity and to prevent excessive accumulation of wealth by a small segment of the people, often by immoral means.
There are many examples of social democracies that have succeeded to give a good life to the people and have a high ranking in the quality of life indicators. They include several countries in Scandanivia and Europe, Canada and Australia. They become the top choice for migrants.
Tan Kin Lian
Quote from Lim Hock Siew's video
The future of socialism
After 50 years when the club was formed, the socialist movement all over the world has suffered a lot of setbacks and even defeats and some wonder whether we are still relevant. The recent economic crisis, the recent financial crisis, has once again exploded the corruption and immorality of the capitalist system and feel that human beings should deserve something better than a aystem that is generated by greed and by corruption,.
Be an Interim Manager
A friend told me that he has registered to be available to work as an interim manager for a company that needs someone to work for the short term, while they look for a permanent manager. You can download this brochure and contact this company if you are keen to join their pool of interim managers to work in your area of expertise.
Monday, April 26, 2010
Foreign Currency Fixed Deposits
Dear Mr Tan,
I have just started a Foreign Currency FD blog: . This allows Singaporeans to access information about FCFD at a glance, rather than searching the websites of individual banks. Would you like to add a link from your blog?
Note:
The URL is also shown on the right panel of this blog.
Your may find it not worthwhile to invest in foreign currency fixed deposit for the short term. You have to incur a spread of 1% (or more) to convert from SGD to foreign currency and to convert back to SGD, reducing the yield on the fixed deposit. If you invest for a longer term, it may be all right.
I have just started a Foreign Currency FD blog: . This allows Singaporeans to access information about FCFD at a glance, rather than searching the websites of individual banks. Would you like to add a link from your blog?
Note:
The URL is also shown on the right panel of this blog.
Your may find it not worthwhile to invest in foreign currency fixed deposit for the short term. You have to incur a spread of 1% (or more) to convert from SGD to foreign currency and to convert back to SGD, reducing the yield on the fixed deposit. If you invest for a longer term, it may be all right.
Improve transport system
Three years ago, I wrote an article on our transport system in Singapore. It was publised in the features pages of the Straits Times. It contained several recommendations to improve our transport system, including the hub-and-spoke system. The article is published here.
Bus stop numbers
Publised in the Straits Times Forum page, 27 April 2010
Fifty years ago, there were a few main roads leading to different parts of Singapore. The milestones on these roads were used to identify the destinations for travellers.
Singapore has grown many times over the years and now has many roads. Now, it is not practical to use the milestones to identify locations. Some people use buildings or block numbers but it is not easy to locate these signs.
We need to find another way to make it easy for people to find their destination. I suggest that the bus stops be used as markers. As each bus stop has already been given a unique 5 digit number, the number could be displayed in a large sign above the bus stop, to be visible from far away.
This large sign will make it easy for commuters to identify the bus stop to alight and also be aware when they have missed their bus stop, as the numbers are likely to be in sequential order.
These markers can also be used to give directions to taxi and car drivers, for example, “drive along Yio Chu Kang road until you pass bus stop 55079 and take the first turn to the left”.
Tan Kin Lian
Fifty years ago, there were a few main roads leading to different parts of Singapore. The milestones on these roads were used to identify the destinations for travellers.
Singapore has grown many times over the years and now has many roads. Now, it is not practical to use the milestones to identify locations. Some people use buildings or block numbers but it is not easy to locate these signs.
We need to find another way to make it easy for people to find their destination. I suggest that the bus stops be used as markers. As each bus stop has already been given a unique 5 digit number, the number could be displayed in a large sign above the bus stop, to be visible from far away.
This large sign will make it easy for commuters to identify the bus stop to alight and also be aware when they have missed their bus stop, as the numbers are likely to be in sequential order.
These markers can also be used to give directions to taxi and car drivers, for example, “drive along Yio Chu Kang road until you pass bus stop 55079 and take the first turn to the left”.
Tan Kin Lian
Justice
One key pillar of Singapore society is the principle of justice. There are written laws in Singapore and legal cases to determine what is legally right and wrong and what are crimes (which has to be prosecuted by the state) and what are civil wrongs (which has to be taken up by the plaintiff in a civil suit).
For example, murder, robbery and violent assault are crimes that has to be investigated and prosecuted by the state. It is not possible for a small citizen to find the money to carry out the investigation and to prosecute the offender. Even if the citizen has the money, they do not have the state power to carry out the investigation and gather evidence. These matters have to be handled by the state.
Cheating cames in a grey area. If one person claims that another person has cheated him, it could be considered as a civil offence that has to be prosecuted individually.
However, if several people complained that they have been cheated under a common mode of operation, it warrants investigation by the authority. This is more urgent when the target of the complaint had advertised their product in the mass media to reach out to a large number of people and continues their mode of operation after complaint has been received.
If the authority carried out an investigation, this mere act would probably put the party under alert and prevent them from continuing their activity blatantly. At the least, it would prevent other ignorant parties from being harmed.
Another option for the police is to carry out the investigation secretly and gather evidence. In some cases, they may carry out what is called a "sting" opertion, i.e. to simulate a case and gather the evidence.
The attorney general in a country is not only the lawyer of the government. This office is also the lawyer of the people. It has the duty to ask for potential wrong doings to be investigated by the police and to prosecute the offender, if sufficient evidence is gathered.
This would strenthen the rule of law and uphold the principle of justice in a country. It is important that all citizens should have access to justice and fairness, regardless of their financial wealth and ability to pay for a civil suit. If you look at the scale of justice, it has to be balanced and not weighted in favor of the rich and powerful.
Tan Kin Lian
For example, murder, robbery and violent assault are crimes that has to be investigated and prosecuted by the state. It is not possible for a small citizen to find the money to carry out the investigation and to prosecute the offender. Even if the citizen has the money, they do not have the state power to carry out the investigation and gather evidence. These matters have to be handled by the state.
Cheating cames in a grey area. If one person claims that another person has cheated him, it could be considered as a civil offence that has to be prosecuted individually.
However, if several people complained that they have been cheated under a common mode of operation, it warrants investigation by the authority. This is more urgent when the target of the complaint had advertised their product in the mass media to reach out to a large number of people and continues their mode of operation after complaint has been received.
If the authority carried out an investigation, this mere act would probably put the party under alert and prevent them from continuing their activity blatantly. At the least, it would prevent other ignorant parties from being harmed.
Another option for the police is to carry out the investigation secretly and gather evidence. In some cases, they may carry out what is called a "sting" opertion, i.e. to simulate a case and gather the evidence.
The attorney general in a country is not only the lawyer of the government. This office is also the lawyer of the people. It has the duty to ask for potential wrong doings to be investigated by the police and to prosecute the offender, if sufficient evidence is gathered.
This would strenthen the rule of law and uphold the principle of justice in a country. It is important that all citizens should have access to justice and fairness, regardless of their financial wealth and ability to pay for a civil suit. If you look at the scale of justice, it has to be balanced and not weighted in favor of the rich and powerful.
Tan Kin Lian
Financial services in Australia
Here are the changes to the legislation on financial services in Australia. Payment of commisison to financial advisers will be banned, to ensure that they put the interest of their clients at the forefront.
Developer familiar with C++
I am looking for a developer who is familiar with C++ to be trained to work on the Qt language that can be used for many mobile platforms. If you are interested to work full time, send a resume to kinlian@gmail.com.
Public Opinion on the Mainstream Media
Bryan Ti said that my article on "An Accountable Parliament" contained a hidden suggestion that the mainstream media is biased against the "opposition" candidates. He asked me to provide evidence to substantiate my point.
I am voicing an opinion tht is shared by many people. The public see what is going on and form their opinion. If you want the public to form a different opinion, you have to give them the reason to change that opinion. After all, this is what public opinion is all about.
I want to share a story. Twenty five years ago, I invited a retired Englishman, and a good friend, to stay in my house for three months. After a week, he told me, "Kin Lian, what kind of rubbish is the ST producing". I was taken aback. He said that the ST presented only the favorable aspect of government policies. It is not possible for any policy to have only one side; there is always another side. In the UK, the papers will write both sides and let the public make their judgement.
Many Singaporeans may not be aware about the hidden bias in the reporting of the mainstream media. I hope that Bryan Ti is right that the mainstream media is now more balanced in their reporting. However, this has to be an opinion that is made by the general public on their own volition.
Tan Kin Lian
I am voicing an opinion tht is shared by many people. The public see what is going on and form their opinion. If you want the public to form a different opinion, you have to give them the reason to change that opinion. After all, this is what public opinion is all about.
I want to share a story. Twenty five years ago, I invited a retired Englishman, and a good friend, to stay in my house for three months. After a week, he told me, "Kin Lian, what kind of rubbish is the ST producing". I was taken aback. He said that the ST presented only the favorable aspect of government policies. It is not possible for any policy to have only one side; there is always another side. In the UK, the papers will write both sides and let the public make their judgement.
Many Singaporeans may not be aware about the hidden bias in the reporting of the mainstream media. I hope that Bryan Ti is right that the mainstream media is now more balanced in their reporting. However, this has to be an opinion that is made by the general public on their own volition.
Tan Kin Lian
Long distance bus routes
Here is the reply from the Government about the change to the long distance bus routes.
http://www.straitstimes.com/STForum/Story/STIStory_519120.html
My comments
I prefer a system of express buses that operate from one interchange to another. It can travel a long distance and have a few stops. Commuters can take the feeder bus to catch the express bus at the interchanges and the limited express stops. The travelling time will be reduced. Although the commuter has to make some transfer, it is good exercise and is similar to transfers to catch the train.
http://www.straitstimes.com/STForum/Story/STIStory_519120.html
My comments
I prefer a system of express buses that operate from one interchange to another. It can travel a long distance and have a few stops. Commuters can take the feeder bus to catch the express bus at the interchanges and the limited express stops. The travelling time will be reduced. Although the commuter has to make some transfer, it is good exercise and is similar to transfers to catch the train.
General election - TV debate
This writer suggest that a debate on TV for the political parties contesting in the general election.
http://www.straitstimes.com/STForum/OnlineStory/STIStory_519057.html
My comment
It is a good suggestion.
http://www.straitstimes.com/STForum/OnlineStory/STIStory_519057.html
My comment
It is a good suggestion.
Sunday, April 25, 2010
Key priorities for Singapore
It is important for the next Parliament to have elected leaders who can reflect the wishes of the people. The key priorities, as expressed through various channels, are:
1. Job opportunity for young and mature workers
2. Lower cost of living
3. Affordable housing
4. Better wages and job security
5. Higher interest rate on savings
6. Better work-life balance
7. Lower transport cost, more comfort and convenience
8. Affordable health care
9. A less crowded environment
I hope that the candidates will campaign hard to provide solutions to these key priorities.
Tan Kin Lian
1. Job opportunity for young and mature workers
2. Lower cost of living
3. Affordable housing
4. Better wages and job security
5. Higher interest rate on savings
6. Better work-life balance
7. Lower transport cost, more comfort and convenience
8. Affordable health care
9. A less crowded environment
I hope that the candidates will campaign hard to provide solutions to these key priorities.
Tan Kin Lian
Buyback of Yield 15 Policy
A policyholder was sold the Yield 15 which provided a payout of 3% per annum. During a volatile period a few months ago, the insurance company offered a 100% payback of the investment, less all the interest coupons that were paid. The policyholder, on the advice of her children, decided to accept the payback offer and to lose the interest. At that time, the market price of the investment was around 90. She was afraid that the investment could drop further and in the worst case, be worth nothing.
In the subsequent months, she found that the price of the investment had improved and there is a good chance that it would safely reach the maturity period with a 100% payback. She regretted her decision to accept the payback offer and losing the 15% interest (i.e. 3% for 5 years).
I told her that she made the right decision at that time. Some investors of certain series of Pinnacle Notes had lost the entire investment due to the failure of a certain number of entities. This could have happened to her Yield 15. It is better to be safe than sorry.
She should not think about the 15% that she had lost. Her actual loss is only 5% (i.e the fixed deposit rate of interest for 5 years). She should not count the higher rate of 3% which is for a more risky product.
My same comment will apply to policyholders who accepted the payback offer from Great Easter Life on the GreatLink Choice (which is a similar product).
Tan Kin Lian
In the subsequent months, she found that the price of the investment had improved and there is a good chance that it would safely reach the maturity period with a 100% payback. She regretted her decision to accept the payback offer and losing the 15% interest (i.e. 3% for 5 years).
I told her that she made the right decision at that time. Some investors of certain series of Pinnacle Notes had lost the entire investment due to the failure of a certain number of entities. This could have happened to her Yield 15. It is better to be safe than sorry.
She should not think about the 15% that she had lost. Her actual loss is only 5% (i.e the fixed deposit rate of interest for 5 years). She should not count the higher rate of 3% which is for a more risky product.
My same comment will apply to policyholders who accepted the payback offer from Great Easter Life on the GreatLink Choice (which is a similar product).
Tan Kin Lian
For the benefit of the future generation
A retired couple told me that they invested more than $500,000 in mini-bonds, yield 15 and equity-linked notes. There financial products were recommended to them by their bank relationship manager as being better than fixed deposits and paying a yield of 3% or 5%. The risks were not explained to them at that time.
The money came from a lifetime of hard work and prudent savings. They lost more than 30% of the total invested amount. Their complaint to FIDREC was dismissed, although they felt that they had a strong case of mis-selling. The wife felt the sense of injustice to be so strong that she wanted her family to emigrate from Singapore.
I told them that the chance of being accepted into another coutnry is small, as they are already in their 60s. Most countries accept immigrants who are younger, as they do not want retirees to benefit from their health care and pension systems. I also advised them to think about the 70% that they had recovered, rather than the 30% that they lost.
Furthermore, it is better to stay in Singpaore and speak against injustice, so that the system can be changed for the benefit of the future generation.
Tan Kin Lian
The money came from a lifetime of hard work and prudent savings. They lost more than 30% of the total invested amount. Their complaint to FIDREC was dismissed, although they felt that they had a strong case of mis-selling. The wife felt the sense of injustice to be so strong that she wanted her family to emigrate from Singapore.
I told them that the chance of being accepted into another coutnry is small, as they are already in their 60s. Most countries accept immigrants who are younger, as they do not want retirees to benefit from their health care and pension systems. I also advised them to think about the 70% that they had recovered, rather than the 30% that they lost.
Furthermore, it is better to stay in Singpaore and speak against injustice, so that the system can be changed for the benefit of the future generation.
Tan Kin Lian
General election
Read this article by Lucky Tan.
My comments
This is an excellent article. It is written in a style that is far superior to what I am able to write.
My comments
This is an excellent article. It is written in a style that is far superior to what I am able to write.
Circle Line (MRT)
I took my first ride on the extended Circle Line yesterday from Dhoby Ghaut to Bras Basah. It was an enjoyable ride. The walking distance between the platforms from the NE Line and Circle Line was quite acceptable.
On my return journey, I took the Circle Line from Bras Basah to Bishan to change to the NE Line. Although the distance and travelling time is longer, I could get a seat, as the train is not crowded.
This new line has expanded the capacity of the train system and should be able to give the commuters a more comfortable ride.
The Circle Line allows commuters from the North to get to Tampines or Changi by changing at Bishan to Paya Lebar. It took 6 stops, compared to 13 stops from Bishan to Raffles City and to Paya Lebar on the NE Line and the EW Line.
If I travel light, I will go to airport from my home by train and return by train.
Tan Kin Lian
On my return journey, I took the Circle Line from Bras Basah to Bishan to change to the NE Line. Although the distance and travelling time is longer, I could get a seat, as the train is not crowded.
This new line has expanded the capacity of the train system and should be able to give the commuters a more comfortable ride.
The Circle Line allows commuters from the North to get to Tampines or Changi by changing at Bishan to Paya Lebar. It took 6 stops, compared to 13 stops from Bishan to Raffles City and to Paya Lebar on the NE Line and the EW Line.
If I travel light, I will go to airport from my home by train and return by train.
Tan Kin Lian
Saturday, April 24, 2010
An accountable Parliament
General election may be held in Singapore during the next six to 12 months. It is important for Singaporeans to vote wisely for a candidate who can best represent their views in Parliament. It is preferable for the elected MP to be able to be a full time MP, as much time is needed to understand the views of the people and to initiate and debate legislation in Parliament.
The candidate should be quite well educated but need not be a corporate leader. It is more important that the candidate should be sincere, competent (as an elected leader) and be willing to serve the people. There are at least two members of the current parliament that meets this description. We need to have more elected leaders of this type.
At election time, the mainstream media will focus on the negative aspects of some candidates. The voters should be aware of the bias of the media and understand that it takes a lot of personal sacrifice and courage for some candidates to stand for election to be a voice of the people in parliament. We should look at their positive aspects and be ready to give them a chance.
The above views are shared by the majority of the people who participated in a survey held a few motnhs ago. The results of this survey are shown here.
The aim is to have a Parliament that reflects the views of the people and to approve legislation and government policies that are good for the country and the people.
Tan Kin Lian
The candidate should be quite well educated but need not be a corporate leader. It is more important that the candidate should be sincere, competent (as an elected leader) and be willing to serve the people. There are at least two members of the current parliament that meets this description. We need to have more elected leaders of this type.
At election time, the mainstream media will focus on the negative aspects of some candidates. The voters should be aware of the bias of the media and understand that it takes a lot of personal sacrifice and courage for some candidates to stand for election to be a voice of the people in parliament. We should look at their positive aspects and be ready to give them a chance.
The above views are shared by the majority of the people who participated in a survey held a few motnhs ago. The results of this survey are shown here.
The aim is to have a Parliament that reflects the views of the people and to approve legislation and government policies that are good for the country and the people.
Tan Kin Lian
Payment of commission
Some financial advisers have complained about not receiving the commission on policies that they have sold based on the unfair practice of their advisory firm or the insurance company. An insurance adviser approached me to air this problem. While the advisers are being bashed (sometimes unfairly), they also face problems of their own.
Here is a letter of complaint to the papers (but not relating to the insurance industry).
Here is a letter of complaint to the papers (but not relating to the insurance industry).
Vista product
Hi Mr Tan,
I bought a investment product named Vista for nearly a year now. I just re-read the policy document and felt that the financial planner had not clearly explained to me the product. The product is an ILP and not what I understood as a normal mutual fund. I realised the costs are high and the surrender value can be significantly lower than total premiums paid in early years of the policy.
Can you advise where I can get help to surrender the policy at no or minimum loss, on grounds of mis-selling?
REPLY
Please approach FISCA at www.fisca.sg. they charge an admin fee of $50 and will help you to write a complaint to FIDREC. The chance of getting redress is uncertain, but is worth a try.
I bought a investment product named Vista for nearly a year now. I just re-read the policy document and felt that the financial planner had not clearly explained to me the product. The product is an ILP and not what I understood as a normal mutual fund. I realised the costs are high and the surrender value can be significantly lower than total premiums paid in early years of the policy.
Can you advise where I can get help to surrender the policy at no or minimum loss, on grounds of mis-selling?
REPLY
Please approach FISCA at www.fisca.sg. they charge an admin fee of $50 and will help you to write a complaint to FIDREC. The chance of getting redress is uncertain, but is worth a try.
Subsidy for public transport
Many people may not realise that public transport is subsidised in Singapore. The government pays for the huge cost of the infrastructure for the MRT system. The public is free from this high cost and has to pay for the operating cost plus the operator's profit margin. I was told that the bus opeators received quite significant subsidy (but details are not available to me). This is why train and bus fares are much cheaper than in some cities, such as London.
I feel that taxis should also be considered as public transport and should receive some subsidy, although not to the same extent as for buses and trains. This will make taxi fares less costly and encourage more people to take taxis, rather than to drive private cars.
A taxi can be used several times a day, and can replace 5 to 10 private cars. It create employment for taxi drivers and allows the commuter to relax, read or communicate on the mobile phone. This improves the productivity. There is less need to build more parking spaces for the private cars.
There may be a fear that lower taxi fares will entice people to use taxis instead of buses and trains. The impact is likely to be small, as taxis will still cost 3 to 5 times of the other modes of transport. The real impact wil be to reduce the demand for private cars.
I hope that the policy makers will review their thinking and consider taxis as another form of public transport and be eligible for some subsidy or be relieved from some taxes or levies, such as ERP.
Tan Kin Lian
I feel that taxis should also be considered as public transport and should receive some subsidy, although not to the same extent as for buses and trains. This will make taxi fares less costly and encourage more people to take taxis, rather than to drive private cars.
A taxi can be used several times a day, and can replace 5 to 10 private cars. It create employment for taxi drivers and allows the commuter to relax, read or communicate on the mobile phone. This improves the productivity. There is less need to build more parking spaces for the private cars.
There may be a fear that lower taxi fares will entice people to use taxis instead of buses and trains. The impact is likely to be small, as taxis will still cost 3 to 5 times of the other modes of transport. The real impact wil be to reduce the demand for private cars.
I hope that the policy makers will review their thinking and consider taxis as another form of public transport and be eligible for some subsidy or be relieved from some taxes or levies, such as ERP.
Tan Kin Lian
ST Forum: Should MAS act?
MANY claims have been made by aggrieved investors in Singapore and other countries of malpractices in the creation and sale of collateralised debt obligations (CDOs) by investment banks.
It was also reported that the United States authorities may investigate other banks that pushed similar CDO products. This is expected, given the copious structures of CDO products prevalent then.
On April 16, Goldman Sachs was charged by the US Securities and Exchange Commission (SEC) with fraud in the structuring and marketing of a debt product tied to sub-prime mortgages.
The SEC alleged that Goldman structured and marketed a synthetic CDO that hinged on the performance of sub-prime residential mortgage-backed securities, and which cost investors more than US$1 billion (S$1.4 billion).
This latest revelation sheds a new light on the debacle and has created widespread public outcry in the US.
But in Singapore, there has been silence from the authorities, although the stakes in Singapore alone are huge, exceeding $100 million of investors' money.
This turn of events prompts at least two questions.
First, should the Monetary Authority of Singapore not open its own investigation into troubled CDOs sold here? In the meantime, should the Government at least stop channelling public deals and business to investment banks that concocted the products, as it suspended local distributors from derivatives sales, until they agree to open their books for scrutiny?
Second, how will the Financial Industry Disputes Resolution Centre (Fidrec) take this into consideration in cases under its judgment in which investors claim mis-selling and malpractice by local distributor-agents and the originator-banks they represent?
How should Fidrec factor this circumstantial evidence into its final decisions pending the outcome of the charges in the US and potential investigations here? Should decisions be deferred or at least be conditional?
Investors, I am sure, look to a constructive and supportive response from the two authorities. For many, this could be the answer to their prayers on what remains a personal dilemma.
Quek Soo Beng
It was also reported that the United States authorities may investigate other banks that pushed similar CDO products. This is expected, given the copious structures of CDO products prevalent then.
On April 16, Goldman Sachs was charged by the US Securities and Exchange Commission (SEC) with fraud in the structuring and marketing of a debt product tied to sub-prime mortgages.
The SEC alleged that Goldman structured and marketed a synthetic CDO that hinged on the performance of sub-prime residential mortgage-backed securities, and which cost investors more than US$1 billion (S$1.4 billion).
This latest revelation sheds a new light on the debacle and has created widespread public outcry in the US.
But in Singapore, there has been silence from the authorities, although the stakes in Singapore alone are huge, exceeding $100 million of investors' money.
This turn of events prompts at least two questions.
First, should the Monetary Authority of Singapore not open its own investigation into troubled CDOs sold here? In the meantime, should the Government at least stop channelling public deals and business to investment banks that concocted the products, as it suspended local distributors from derivatives sales, until they agree to open their books for scrutiny?
Second, how will the Financial Industry Disputes Resolution Centre (Fidrec) take this into consideration in cases under its judgment in which investors claim mis-selling and malpractice by local distributor-agents and the originator-banks they represent?
How should Fidrec factor this circumstantial evidence into its final decisions pending the outcome of the charges in the US and potential investigations here? Should decisions be deferred or at least be conditional?
Investors, I am sure, look to a constructive and supportive response from the two authorities. For many, this could be the answer to their prayers on what remains a personal dilemma.
Quek Soo Beng
Foreign ownership of Australian property
Dear Mr Tan,
I just read on bloomberg that Australia is going to toughen rules on non-citizen ownership of australian property. The boom in commodities and natural resources, plus lots of liquidity coming from rich Chinese have escalated their property prices over the last year or so.
Seems like the australian govt is pretty sensitive to local concerns and high property prices, even though some statistics indicated only less than 1% are foreigner buyers.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aZMzrVOOWWow
My comments
An important duty of any government is to make sure that housing is affordable to the population. The government should prevent property prices from being inflated by foreign buying, especially if prices are pushed up and the profit is taken away by the foreigners.
I just read on bloomberg that Australia is going to toughen rules on non-citizen ownership of australian property. The boom in commodities and natural resources, plus lots of liquidity coming from rich Chinese have escalated their property prices over the last year or so.
Seems like the australian govt is pretty sensitive to local concerns and high property prices, even though some statistics indicated only less than 1% are foreigner buyers.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aZMzrVOOWWow
My comments
An important duty of any government is to make sure that housing is affordable to the population. The government should prevent property prices from being inflated by foreign buying, especially if prices are pushed up and the profit is taken away by the foreigners.
Goldman Sach's Prosecution
Goldman Sach's Prosecution threaten to open the floodgates on Wall Street. Read this article.
HDB dwellers can try RTM1 for World Cup
EXTRACT FROM ST ONLINE
FOOTBALL fans, good news if you are among the 80 per cent of the population living in public housing. Leonard Lim, Chan U Gene & Jeff Ang.
FOOTBALL fans, good news if you are among the 80 per cent of the population living in public housing.
Chances are, you will be able to catch 20 World Cup games live and another 11 delayed on a free-to-air Malaysian channel - if the unthinkable happens and Singapore fails to secure the broadcast rights to the football extravaganza.
And some HDB dwellers who can receive Indonesian channels such as RCTI and Global TV may even be able to watch all 64 matches live.
Cashew Nut
FOOTBALL fans, good news if you are among the 80 per cent of the population living in public housing. Leonard Lim, Chan U Gene & Jeff Ang.
FOOTBALL fans, good news if you are among the 80 per cent of the population living in public housing.
Chances are, you will be able to catch 20 World Cup games live and another 11 delayed on a free-to-air Malaysian channel - if the unthinkable happens and Singapore fails to secure the broadcast rights to the football extravaganza.
And some HDB dwellers who can receive Indonesian channels such as RCTI and Global TV may even be able to watch all 64 matches live.
Cashew Nut
Friday, April 23, 2010
TKL Intelligence Quiz (7 houses)
I sold over 1,800 copies of volume 2 of the TKL Intelligence Quiz. There are a few copies left as my print run was only 2,000 copies. I was surprised at its popularity.
Vol 3 is now available for sale in the major bookstores and can also be purchased online for $7.90.
One fan asked me to produce more puzzles, entirely at difficult levels. I have produced a soft copy of a book containing 24 puzzles involving 7 houses. A sample of the puzzle can be downloaded for free here. If you like it, you can purchase the soft copy for $4.90 online.
Tan Kin Lian
Vol 3 is now available for sale in the major bookstores and can also be purchased online for $7.90.
One fan asked me to produce more puzzles, entirely at difficult levels. I have produced a soft copy of a book containing 24 puzzles involving 7 houses. A sample of the puzzle can be downloaded for free here. If you like it, you can purchase the soft copy for $4.90 online.
Tan Kin Lian
Thursday, April 22, 2010
Platform for PMET
Mr Tan,
It will be very good if you could create a platform for the "old & poor" PMETs to network and connect.
They may team up to do somethings meaningful with their experiences & resources. Thank you.
REPLY
Please suggest what are the features that should be made available in this platform or portal. If anyone wish to lead in this portal, please send email to kinlian@gmail.com
It will be very good if you could create a platform for the "old & poor" PMETs to network and connect.
They may team up to do somethings meaningful with their experiences & resources. Thank you.
REPLY
Please suggest what are the features that should be made available in this platform or portal. If anyone wish to lead in this portal, please send email to kinlian@gmail.com
Article on land banking
Hi Mr Tan,
Having read about " Investing land outside Singapore" in your Blog, I came across this Updated April 2010 Article that says it all: Nevermind the source but go for the facts.
http://www.learnmoney.co.uk/advice/advice-87.html
JLN
Having read about " Investing land outside Singapore" in your Blog, I came across this Updated April 2010 Article that says it all: Nevermind the source but go for the facts.
http://www.learnmoney.co.uk/advice/advice-87.html
JLN
Investing in land outside Singapore
Someone sent me an e-mail to explain the "professional approach" taken by a land banking company operating in Singapore in submitting applications for approval for development for green belt land in the UK. Some other people said that investing in these land banking plots is similar to investing in properties in Singapore.
Some knowledgeable people told me the following poitns:
a) The land banking plots were sold at 20 to 30 times of the real value of the greenbelt land
b) The chance of getting approval is very slim (and I guess that it must be less than 1%)
Many investors have told me that they invested in these plots and, after waiting for many years they have still not got back their investments. If they sell now, there are no buyers for their plots. Some investors bought the land with an option to sell the land back after 6 or 12 months to the promoter. The options were not honored. They were asked to roll over the investments or to wait for new funds to be available in the future. It will be a long wait.
Tan Kin Lian
Some knowledgeable people told me the following poitns:
a) The land banking plots were sold at 20 to 30 times of the real value of the greenbelt land
b) The chance of getting approval is very slim (and I guess that it must be less than 1%)
Many investors have told me that they invested in these plots and, after waiting for many years they have still not got back their investments. If they sell now, there are no buyers for their plots. Some investors bought the land with an option to sell the land back after 6 or 12 months to the promoter. The options were not honored. They were asked to roll over the investments or to wait for new funds to be available in the future. It will be a long wait.
Tan Kin Lian
Buy insurance directly
Aviva has taken the bold step to offer motor insurance directly to the public. Some motorists have found the premium to be much lower than the rates charged by other insurance companies. A few examples have been posted in this blog.
I encourage commuters to use the quotation service available in Aviva's website to compare their premium rate with the premium rate charged by your current insurer. You can get an idea about the difference in premiums. If Aviva is much lower, you can consider to switch to them on the next renewal.
You should also look at the Term Insurance rates that is offered by Avivia. You can select a level or decreasing cover. Please send their quotes for me to make a comparison against the benchmark set in my book, Practical Guide on Financial Planning.
My benchmark is rather high. If you find a premium that is higher than my benchmark, you should avoid it. In most cases, you should be able to get a premium rate that is lower than my benchmark.
Tan Kin Lian
I encourage commuters to use the quotation service available in Aviva's website to compare their premium rate with the premium rate charged by your current insurer. You can get an idea about the difference in premiums. If Aviva is much lower, you can consider to switch to them on the next renewal.
You should also look at the Term Insurance rates that is offered by Avivia. You can select a level or decreasing cover. Please send their quotes for me to make a comparison against the benchmark set in my book, Practical Guide on Financial Planning.
My benchmark is rather high. If you find a premium that is higher than my benchmark, you should avoid it. In most cases, you should be able to get a premium rate that is lower than my benchmark.
Tan Kin Lian
New fare structure for public transport
A new distanced based fare structure is being implemented in Singapore. The aim is to charge the fare based on distance and not on the number of connections. Under the new structure, those who have to make several connections will pay less (compared to the past) and those who had a direct bus will pay more. Those who have to pay more under the new structure complained that the change is unfair to them.
I believe that this change is necessary and will benefit the public in the long run. It will allow the public transport system to be runned in the most efficient manner and for fewer bus routes and (hopefully) more efficient feeder services.
My wish is for feeder services to be cheaper and have shorter waiting and travelling times. I do not mind taking a feeder bus to the train station or bus interchange and to take a long distance bus (with few stops) to reach my destination. I am used to making transfers between bus to train and from train to train. It is acceptable to the majority of commuters who are mobile. (The needs of the elderly and the handicapped may have to be served differently).
I hope that the public will be patient and try to get used to the changes and the new system. I am hopeful that it will be better.
Tan Kin Lian
I believe that this change is necessary and will benefit the public in the long run. It will allow the public transport system to be runned in the most efficient manner and for fewer bus routes and (hopefully) more efficient feeder services.
My wish is for feeder services to be cheaper and have shorter waiting and travelling times. I do not mind taking a feeder bus to the train station or bus interchange and to take a long distance bus (with few stops) to reach my destination. I am used to making transfers between bus to train and from train to train. It is acceptable to the majority of commuters who are mobile. (The needs of the elderly and the handicapped may have to be served differently).
I hope that the public will be patient and try to get used to the changes and the new system. I am hopeful that it will be better.
Tan Kin Lian
Upfront payment
There are a few cases of private schools that closed down, causing large financial losses to students who paid the upfront fees for an education course of one, two or three years. The Ministry of Education has decided to regulate the industry, because the closure of these schools has given a bad reputation to Singapore.
This reminds me of unregulated investment schemes where the promoters promised to pay back the investments after 6, 9 or 12 months at an attractive rate of interest. When the investments mature, the promoters gave all types of excuses and refused to honor the payback arrangement. Complaints to the authority and the police were not followed up.
This is also giving a bad reputation to Singapore. They also have to be regulated. It is easy for the promoters to collect money from investors and difficult for the investors to get their money back.
It is best to avoid all types of unregulated investments. There is no way for you to do due diligence, if the scheme was set up with the purpose of defrauding the public and the regulator is not willing to take the matter to court. This advice is contained in my book, Practical Guide on Financial Planning.
This reminds me of unregulated investment schemes where the promoters promised to pay back the investments after 6, 9 or 12 months at an attractive rate of interest. When the investments mature, the promoters gave all types of excuses and refused to honor the payback arrangement. Complaints to the authority and the police were not followed up.
This is also giving a bad reputation to Singapore. They also have to be regulated. It is easy for the promoters to collect money from investors and difficult for the investors to get their money back.
It is best to avoid all types of unregulated investments. There is no way for you to do due diligence, if the scheme was set up with the purpose of defrauding the public and the regulator is not willing to take the matter to court. This advice is contained in my book, Practical Guide on Financial Planning.
Land banking investments - survey
If you wish to share your experience in land banking investment or contact other investors in similar situations, click here. It can be both positive or negative experience.
Tan Kin Lian
Tan Kin Lian
Wednesday, April 21, 2010
Public transport fares
I WAS surprised to read in yesterday's report that bus and train fares will go down by 2.5 per cent ('New bus, train fare system'). To peg charges to the distance travelled is a great system of calculation. Thank you, Public Transport Council, for such a good move.
Bennie Cheok
http://www.straitstimes.com/STForum/OnlineStory/STIStory_517466.html
Bus, train fare system must be fair to all THE Public Transport Council's decision ('New bus, train fare system'; yesterday) to implement a distance-based system to calculate transport fares with effect from July 3 is a novel approach.
While the council says it will lead to greater savings for nearly two out of three commuters, my concern is for the third of commuters who must pay a higher transport fare than at present.
It seems highly unusual that we have to penalise a significant number of commuters just because they have a direct route to their destinations. Through no fault of their own, they find themselves having to pay more so that the majority can pay less. There should be as much fairness as possible and this should not be at the expense of the minority, or anyone for that matter.
The aim should be to improve everyone's life while not worsening anyone's life in the process. I hope that future fare calculations will be done with this in mind.
Gregory Lou
http://www.straitstimes.com/STForum/Story/STIStory_517597.html
Bennie Cheok
http://www.straitstimes.com/STForum/OnlineStory/STIStory_517466.html
Bus, train fare system must be fair to all THE Public Transport Council's decision ('New bus, train fare system'; yesterday) to implement a distance-based system to calculate transport fares with effect from July 3 is a novel approach.
While the council says it will lead to greater savings for nearly two out of three commuters, my concern is for the third of commuters who must pay a higher transport fare than at present.
It seems highly unusual that we have to penalise a significant number of commuters just because they have a direct route to their destinations. Through no fault of their own, they find themselves having to pay more so that the majority can pay less. There should be as much fairness as possible and this should not be at the expense of the minority, or anyone for that matter.
The aim should be to improve everyone's life while not worsening anyone's life in the process. I hope that future fare calculations will be done with this in mind.
Gregory Lou
http://www.straitstimes.com/STForum/Story/STIStory_517597.html
Part time work
Are you interested to do part time work at Tampines St 92 and petrol stations in Serangoon North and Mandai to promote a new taxi calling service? You have to distribute leaflets to taxi drivers and explain the service to them. This is suitable for older people in their 40s or for students during the holidays. The pay will be based on hourly rate and will be for 4 hours a day or longer. If you are interested, you can call Song Kwang (mobile: 97110423) or send an e-mail to kinlian@gmail.com.
NOTE: If you know of someone interested in this part time work, please tell them about it. Pass the word around.
NOTE: If you know of someone interested in this part time work, please tell them about it. Pass the word around.
Winning elections
Some views from Yoong Siew Wah.
My comment
It is better to lose an election honorably than to resort to dirty tricks to get re-elected.
My comment
It is better to lose an election honorably than to resort to dirty tricks to get re-elected.
Reputation of Shopping Malls
Dear Mr. Tan
A land banking company is using temporary space in Vivocity. They seem to be using legitimate real estate to introduce land banking and high yield investment offerings. The same compay also uses space in Raffles City.
To what extent do the owners of these locations have a responsibility to ensure that the space they rent is used ethically and legally ?. And to what extent does their brand image suffer by being associated with non-ethical investment programs ?
Certain shopping malls in Singapore have a reputation for cheating consumers even though the majority of retailers in those locations are honest. High end brands wont move to those locations because of that reputation. Rents and reputation suffer accordingly. Some of these high end shopping malls should perhaps think about how many cheating retailers it takes to make a bad reputation.
SF
A land banking company is using temporary space in Vivocity. They seem to be using legitimate real estate to introduce land banking and high yield investment offerings. The same compay also uses space in Raffles City.
To what extent do the owners of these locations have a responsibility to ensure that the space they rent is used ethically and legally ?. And to what extent does their brand image suffer by being associated with non-ethical investment programs ?
Certain shopping malls in Singapore have a reputation for cheating consumers even though the majority of retailers in those locations are honest. High end brands wont move to those locations because of that reputation. Rents and reputation suffer accordingly. Some of these high end shopping malls should perhaps think about how many cheating retailers it takes to make a bad reputation.
SF
Buy motor insurance directly
Dear Mr Tan,
I wish to share a low-cost online purchase of car insurance with Aviva.
www.aviva.com.sg
Please share this in your blog if you like.
My profile: Male, 34, married, zero NCD, driving license 7 years, indoor job, 2005 used car, 1.4liter, zero demerit point.
Annual Premium: is $1503 ($500 excess, zero NCD, any 25 years old & above can drive, pay in full with credit card).
I have 5 other car insurance quotes and the next lowest annual premium is $1900+.
I heard over the radio (Class 95) that Aviva is new to the car insurance market in Singapore, They are taking away the middle man and streamline the back office operation and therefore giving a good deal to drivers.
This is a good buy direct service with the Internet.
My comment
It will be easy to get a quote from Aviva through their website. You do not need to wait for the next renewal date. You can ask for a quote for your current year and compare with your existing premium, just to get an idea about how competitive they are.
I wish to share a low-cost online purchase of car insurance with Aviva.
www.aviva.com.sg
Please share this in your blog if you like.
My profile: Male, 34, married, zero NCD, driving license 7 years, indoor job, 2005 used car, 1.4liter, zero demerit point.
Annual Premium: is $1503 ($500 excess, zero NCD, any 25 years old & above can drive, pay in full with credit card).
I have 5 other car insurance quotes and the next lowest annual premium is $1900+.
I heard over the radio (Class 95) that Aviva is new to the car insurance market in Singapore, They are taking away the middle man and streamline the back office operation and therefore giving a good deal to drivers.
This is a good buy direct service with the Internet.
My comment
It will be easy to get a quote from Aviva through their website. You do not need to wait for the next renewal date. You can ask for a quote for your current year and compare with your existing premium, just to get an idea about how competitive they are.
Land banking story on CNA - 18 April
The land banking story was aired on 18 April. I was not able to watch it (as I was interviewed at the same time on another programme). Can those who watched it shared your views?
Pain of separation
As I was entering the departure hall at Jakarta Airport, I saw a scene that touched my heart. A little girl (maybe 5 years old) was crying loudly. She was clinging to her father who was leaving Indonesia, probably to work overseas. Her grand parents were trying to console her.
I was very sad that families had to be broken in this manner and that the parents had to be separated from their small children to work overseas. Many of these parents are working in Singapore as domestic maids and foreign workers. Many employers do not like their maids to use the telephone as they may "cause trouble". The maids are also discouraged to telephone to their families at home.
I hope that the employers realise that these maids and foreign workers have family and children back at home. Let us help them to lessen their pain of being separated from their family.
Tan Kin Lian
I was very sad that families had to be broken in this manner and that the parents had to be separated from their small children to work overseas. Many of these parents are working in Singapore as domestic maids and foreign workers. Many employers do not like their maids to use the telephone as they may "cause trouble". The maids are also discouraged to telephone to their families at home.
I hope that the employers realise that these maids and foreign workers have family and children back at home. Let us help them to lessen their pain of being separated from their family.
Tan Kin Lian
Tuesday, April 20, 2010
Photogragh and fingerprints of travellers
I was delayed for 30 minutes at the immigration counter at Jakarta airport. The delay was due to an exercise to capture the photograph and fingerprint of visitors. A friend who arrived in Jakarta later in the day was delayed by 3 hours.
It would be quite troublesome to visitors, if all the countries decide that they need to capture the photographs and fingerprints of all visitors. Surely, the information can be captured once, e.g. at the home country, and can be allowed for access by immigration authorities in all the countries that are being visited?
Perhaps a global organisation like Google or Microsoft can provide this service and encourage immigration authorities to access a common server? As a traveller, I am happy to have the images captured once and be accessed globally.
Tan Kin Lian
It would be quite troublesome to visitors, if all the countries decide that they need to capture the photographs and fingerprints of all visitors. Surely, the information can be captured once, e.g. at the home country, and can be allowed for access by immigration authorities in all the countries that are being visited?
Perhaps a global organisation like Google or Microsoft can provide this service and encourage immigration authorities to access a common server? As a traveller, I am happy to have the images captured once and be accessed globally.
Tan Kin Lian
Visitors to TKL blog
I used to have 2,500 to 3,000 visitors to my blog during weekdays. This week, it increased by 50%. Why is there a sudden jump? Is someone asking other people to visit my blog?
Gold Investment Program
Dear Mr Tan,
I've recently come across a gold program which provides a guaranteed return of 9% in 6 months through the purchase of physical gold - good delivery bars (999.9).
The outline of the program is as follows:
Day 1: Client purchases and collects gold based on retail price, less initial Cash Discount 3%, plus GST 7%
Day 90: Client receives 3% Sell-Back Incentive - credited into the client's bank account.
Day 180-187: At this point, client needs to decide whether to keep the gold or exercise a sell-back option. The two scenarios are included below.
(a) Keep the gold: Receives 3% bonus
(b) Exercise Sell-Back option based on purchase price: Receives 3% bonus, 7% Sell-back bonus equivalent to GST, agreed Sell-back price (100% of Purchase Price)
In effect, by choosing (b) the sell-back option, clients will receive a 9% nett return.
After the conclusion of the six-month agreement, clients may choose to take up a new 6-month agreement.
Would like your thoughts on the program?
REPLY
The retail price of the gold sold to you is likely to have a high markup from the wholesale price. If the price of gold drops, the promoter is likely to default on the buy-back option, so you will have to keep the gold at its depreciated price. You will suffer a further loss from the markup that you paid.
If more people are buying into this program compared to those who redeem, the promoter may honor the buyback option to entice you to re-invest and get more friends to join in. This is how a ponzi scheme operates.
Avoid all types of unregulated invetment products. Read the tips in my book, Practical Guide on Financial Planning.
I've recently come across a gold program which provides a guaranteed return of 9% in 6 months through the purchase of physical gold - good delivery bars (999.9).
The outline of the program is as follows:
Day 1: Client purchases and collects gold based on retail price, less initial Cash Discount 3%, plus GST 7%
Day 90: Client receives 3% Sell-Back Incentive - credited into the client's bank account.
Day 180-187: At this point, client needs to decide whether to keep the gold or exercise a sell-back option. The two scenarios are included below.
(a) Keep the gold: Receives 3% bonus
(b) Exercise Sell-Back option based on purchase price: Receives 3% bonus, 7% Sell-back bonus equivalent to GST, agreed Sell-back price (100% of Purchase Price)
In effect, by choosing (b) the sell-back option, clients will receive a 9% nett return.
After the conclusion of the six-month agreement, clients may choose to take up a new 6-month agreement.
Would like your thoughts on the program?
REPLY
The retail price of the gold sold to you is likely to have a high markup from the wholesale price. If the price of gold drops, the promoter is likely to default on the buy-back option, so you will have to keep the gold at its depreciated price. You will suffer a further loss from the markup that you paid.
If more people are buying into this program compared to those who redeem, the promoter may honor the buyback option to entice you to re-invest and get more friends to join in. This is how a ponzi scheme operates.
Avoid all types of unregulated invetment products. Read the tips in my book, Practical Guide on Financial Planning.
Financial Underwriting
Dear Mr Tan,
Recently, I wanted to buy an Aviva term insurance with coverage of $350k that covers premature death, In the application form, I was asked to list down the insurance policies that I already had. Subsequently, our insurance agent informed us that Aviva would require us to furnish them our financial information which includes submission of income tax assessment as my total coverage for all his policies is more than $1m.
I would like to enquire whether it is a norm for insurance company to request for financial information and whether I should submit to Aviva as I find that the information required is quite personal. Is it true that one could not have coverage more than $1m?
REPLY
Most insurance companies needs to do financial underwriting - where the total sum insured exceed a large sum. This is to prevent moral hazard. Different companies have different thresholds. I think that $1 million is probably a reasonable threshold to ask for this information. Although Aviva is covering for only $350k, it is still necessary for them to consider the total picture.
You can read my book, Practical Guide on Financial Planning, for tips on buying life insurance coverage.
Recently, I wanted to buy an Aviva term insurance with coverage of $350k that covers premature death, In the application form, I was asked to list down the insurance policies that I already had. Subsequently, our insurance agent informed us that Aviva would require us to furnish them our financial information which includes submission of income tax assessment as my total coverage for all his policies is more than $1m.
I would like to enquire whether it is a norm for insurance company to request for financial information and whether I should submit to Aviva as I find that the information required is quite personal. Is it true that one could not have coverage more than $1m?
REPLY
Most insurance companies needs to do financial underwriting - where the total sum insured exceed a large sum. This is to prevent moral hazard. Different companies have different thresholds. I think that $1 million is probably a reasonable threshold to ask for this information. Although Aviva is covering for only $350k, it is still necessary for them to consider the total picture.
You can read my book, Practical Guide on Financial Planning, for tips on buying life insurance coverage.
Philosophy of Life - Mexican fishermen
Source: e-mail sent to me
A boat docked in a tiny Mexican fishing village.
A tourist complimented the local fishermen on the quality of their fish and asked how long it took him to catch them.
"Not very long." they answered in unison.
"Why didn't you stay out longer and catch more?"
The fishermen explained that their small catches were sufficient to meet their needs and those of their families.
"But what do you do with the rest of your time?"
"We sleep late, fish a little, play with our children, and take siestas with our wives. In the evenings, we go into the village to see our friends, have a few drinks, play the guitar, and sing a few songs. We have a full life."
The tourist interrupted, "I have an MBA from Harvard and I can help you! You should start by fishing longer every day. You can then sell the extra fish you catch. With the extra revenue, you can buy a bigger boat."
"And after that?"
"With the extra money the larger boat will bring, you can buy a second one and a third one and so on until you have an entire fleet of trawlers.
Instead of selling your fish to a middle man, you can then negotiate directly with the processing plants and maybe even open your own plant. You can then leave this little village and move to Mexico City , Los
Angeles , or even New York City !
From there you can direct your huge new enterprise."
"How long would that take?"
"Twenty, perhaps twenty-five years." replied the tourist.
"And after that?"
"Afterwards? Well my friend, that's when it gets really interesting, " answered the tourist, laughing. "When your business gets really big, you can start buying and selling stocks and make millions!"
"Millions? Really? And after that?" asked the fishermen..
"After that you'll be able to retire, live in a tiny village near the coast, sleep late, play with your children, catch a few fish, take a siesta with your wife and spend your evenings drinking and enjoying your friends."
"With all due respect sir, but that's exactly what we are doing now. So what's the point wasting twenty-five years?" asked the Mexicans.
And the moral of this story is: Know where you're going in life... you may already be there.
A boat docked in a tiny Mexican fishing village.
A tourist complimented the local fishermen on the quality of their fish and asked how long it took him to catch them.
"Not very long." they answered in unison.
"Why didn't you stay out longer and catch more?"
The fishermen explained that their small catches were sufficient to meet their needs and those of their families.
"But what do you do with the rest of your time?"
"We sleep late, fish a little, play with our children, and take siestas with our wives. In the evenings, we go into the village to see our friends, have a few drinks, play the guitar, and sing a few songs. We have a full life."
The tourist interrupted, "I have an MBA from Harvard and I can help you! You should start by fishing longer every day. You can then sell the extra fish you catch. With the extra revenue, you can buy a bigger boat."
"And after that?"
"With the extra money the larger boat will bring, you can buy a second one and a third one and so on until you have an entire fleet of trawlers.
Instead of selling your fish to a middle man, you can then negotiate directly with the processing plants and maybe even open your own plant. You can then leave this little village and move to Mexico City , Los
Angeles , or even New York City !
From there you can direct your huge new enterprise."
"How long would that take?"
"Twenty, perhaps twenty-five years." replied the tourist.
"And after that?"
"Afterwards? Well my friend, that's when it gets really interesting, " answered the tourist, laughing. "When your business gets really big, you can start buying and selling stocks and make millions!"
"Millions? Really? And after that?" asked the fishermen..
"After that you'll be able to retire, live in a tiny village near the coast, sleep late, play with your children, catch a few fish, take a siesta with your wife and spend your evenings drinking and enjoying your friends."
"With all due respect sir, but that's exactly what we are doing now. So what's the point wasting twenty-five years?" asked the Mexicans.
And the moral of this story is: Know where you're going in life... you may already be there.
Immigrants into Singapore
Read this article by Yoong Siew Wah.
My comments
The writer said that 30,000 PMETs have lost their jobs and are still unemployed. I do not know if this figure is accurate. Can someone help to find the source?
My comments
The writer said that 30,000 PMETs have lost their jobs and are still unemployed. I do not know if this figure is accurate. Can someone help to find the source?
Defamation
This cartoon would be considered as defamatory in Singapore. It is why Singaporeans learn to shut their mouth. How sad. We breed a nation of people without courage or character.
Gambling with the economy
The banks have forgotten their roles in raising funds for industry. They are now operating a large casino, taking bets. Read this story.
My comment
I sat in an interview panel of students applying for a place in a university. Half of the students wanted to work in a bank or the finance sector. This is bad for the future of the country. They want to earn big money from a business that makes its profits from gambling, and pretending to be other than gambling.
My comment
I sat in an interview panel of students applying for a place in a university. Half of the students wanted to work in a bank or the finance sector. This is bad for the future of the country. They want to earn big money from a business that makes its profits from gambling, and pretending to be other than gambling.
Monday, April 19, 2010
ATM Funds transfer in Jakarta
Several banks in Jakarta allows customers to transfer funds at ATM machines by entering the amount, recipient account number and a reference number. The ATM will show the name of the recipient for confirmation. The reference number allows the recipient to know who made the payment.
Our banks in Singapore now allow customers to transfer funds through ATM machines but does not allow a reference number to be entered. The recipient does not know who made the payment.
I hope that our banks in Singapore can provide a similar service, i.e. allow the funds to be transferred by ATM and allow a reference number to be entered. This will reduce the need for customers to send cheques for business payments. It will improve efficiency. I hope that MAS can encourage the banks to offer this service.
Tan Kin Lian
Our banks in Singapore now allow customers to transfer funds through ATM machines but does not allow a reference number to be entered. The recipient does not know who made the payment.
I hope that our banks in Singapore can provide a similar service, i.e. allow the funds to be transferred by ATM and allow a reference number to be entered. This will reduce the need for customers to send cheques for business payments. It will improve efficiency. I hope that MAS can encourage the banks to offer this service.
Tan Kin Lian
Personal sacrifice by Goh Meng Seng
Goh Meng Seng helped me to deliver the Mandarin version of my speeches on several occasions to the investors at Hong Lim Park in the last quarter of 2008. His assistance to me, and to the investors, was invaluable.
A mutual friend told me that Meng Seng is selling his HDB flat to raise funds for the general election campaign in Tampines. He is the Secretary General of the National Solidarity Party. I check with Meng Seng to verify the accuracy of this information and he replied:
Quote
Yes, I am selling my flat to raise some funds for my campaign. As the leader of the party and the Tampines team, I need to build up my war chest in preparation for the eventual battle.I am able to do this basically because my wife and daughter are working and studying in Hong Kong and I am taking care of my aged mother (81 years old) by staying with her now. Most importantly, I am fortunate to have a very understanding and supportive wife. Freedom is not free. Pursuing Freedom and providing others the freedom of choice is not free. Some have asked me why don't I just take a personal loan. I don't like to have too many liabilities in life. On the other hand, selling my flat may serve me well. If I lose, so be it. Maybe by then, it would be much easier for me to join my family in Hong Kong to start fresh again. It is never easy to maintain a family in two places. If I win, I would be able to buy a flat in Tampines and become the Full Time MP there. Things will have to be rearranged in either outcomes.I think the most important thing is for people to realize that politics is about public service; not just opposition politics, but it is expected of the ruling party politicians as well. Public service may mean sacrifices on both financial as well as family time. Meng Seng
Unquote
My comments
Meng Seng is sincere and willing to serve the people of Singapore. I like to wish him success. I hope that Singaporeans realise the personal sacrifice that people like him have to make to make to provide an alternative voice for the people.
A mutual friend told me that Meng Seng is selling his HDB flat to raise funds for the general election campaign in Tampines. He is the Secretary General of the National Solidarity Party. I check with Meng Seng to verify the accuracy of this information and he replied:
Quote
Yes, I am selling my flat to raise some funds for my campaign. As the leader of the party and the Tampines team, I need to build up my war chest in preparation for the eventual battle.I am able to do this basically because my wife and daughter are working and studying in Hong Kong and I am taking care of my aged mother (81 years old) by staying with her now. Most importantly, I am fortunate to have a very understanding and supportive wife. Freedom is not free. Pursuing Freedom and providing others the freedom of choice is not free. Some have asked me why don't I just take a personal loan. I don't like to have too many liabilities in life. On the other hand, selling my flat may serve me well. If I lose, so be it. Maybe by then, it would be much easier for me to join my family in Hong Kong to start fresh again. It is never easy to maintain a family in two places. If I win, I would be able to buy a flat in Tampines and become the Full Time MP there. Things will have to be rearranged in either outcomes.I think the most important thing is for people to realize that politics is about public service; not just opposition politics, but it is expected of the ruling party politicians as well. Public service may mean sacrifices on both financial as well as family time. Meng Seng
Unquote
My comments
Meng Seng is sincere and willing to serve the people of Singapore. I like to wish him success. I hope that Singaporeans realise the personal sacrifice that people like him have to make to make to provide an alternative voice for the people.
HDB's place in Singapore's history
Richard Lu wrote about the special place of HDB in Singapore's history and how the role has changed (in the wrong direction) over the years. Read his article here
My comments
I agree with his view that HDB flats should be kept affordable and should not be a means of generating wealth. .
My comments
I agree with his view that HDB flats should be kept affordable and should not be a means of generating wealth. .
Sunday, April 18, 2010
World Movement for Democracy
This organisation held its general assembly in Jakarta. President Yudhoyono opened the meeting. This important meeting was not covered in our Singapore media. Here is a report in Temasek Review.
From 5Cs to 5 Ks
Are Singaporeans still craving for the 5C's : Car, Condo, Credit Card, Club membership and Career?
Looks like Car & Condo will be elusive because of Higher COEs and High Property Prices for now whereas, on the other hand, looks like some are concerned about the 5K's
Kiasu (scared of losing)
Kiasee (scared of dying)
Kiabor (scared of wife)
Kiaboh (scared of having nothing)
Kiachenghu (scared of government)
LN
Looks like Car & Condo will be elusive because of Higher COEs and High Property Prices for now whereas, on the other hand, looks like some are concerned about the 5K's
Kiasu (scared of losing)
Kiasee (scared of dying)
Kiabor (scared of wife)
Kiaboh (scared of having nothing)
Kiachenghu (scared of government)
LN
US Securities Exchange Commission sues Goldman Sachs
The US Securities and Exchange Commission has taken the bold step to sue Goldman Sachs for fraud in connection with the creation of complex financial products that are sold in the market. They involve the packaging of the sub-prime mortgages into collateralized debt obligations and credit default swaps. One argument put forward by the SEC is that Goldman Sachs knew that the sub-prime mortgages were already in trouble at the time that these products were created.
This is only the first step. Many other investment banks were also involved in creating similar products and may face similar actions by the SEC.
Our equivalent of the SEC is the Monetary Authority of Singapore. I hope that our MAS will also see if there is scope for similar actions to be taken in Singapore in respect of the complex products that were sold here. These products, such as the Mini-bonds and Pinnacle Notes, have caused huge losses to the retail investors in Singapore.
Tan Kin Lian
News clippings:
http://dealbook.blogs.nytimes.com/2010/04/16/s-e-c-sues-goldman-over-housing-market-deal/
http://www.reuters.com/article/idUSTRE63F3LM20100416
This is only the first step. Many other investment banks were also involved in creating similar products and may face similar actions by the SEC.
Our equivalent of the SEC is the Monetary Authority of Singapore. I hope that our MAS will also see if there is scope for similar actions to be taken in Singapore in respect of the complex products that were sold here. These products, such as the Mini-bonds and Pinnacle Notes, have caused huge losses to the retail investors in Singapore.
Tan Kin Lian
News clippings:
http://dealbook.blogs.nytimes.com/2010/04/16/s-e-c-sues-goldman-over-housing-market-deal/
http://www.reuters.com/article/idUSTRE63F3LM20100416
Saturday, April 17, 2010
Overseas orders for Financial Planning book
I received a few orders from overseas for my book, Practical Guide on Financial Planning. I am not sure if they are from Singaporeans who live or work overseas or from foreigners who like to learn about financial planning for their own environment. A large portion of my book contain financial education that is applicable in other countries as well.
Tan Kin Lian
Tan Kin Lian
COE and car prices
I spoke to someone, who is familiar with the motor trade. He made the following points:
a. The recent change resulted in a drop of 40% in COE allocation. This caused COE prices to shoot up due to the cut and also to increased demand generated by fear of further price increases. It is better to have a more stable market, rather than fluctuating prices to drive consumer behavior.
b. Taxis are now in the same category as private cars. They should be kept in a spearate category as the owners of taxis are driven by commercial consideration.
c. There is need to improve the feeder services, so that more people will take the train and buses at the interchanges.
d. Taxis should be considered as public transport. They are more efficient than cars and do not require parking spaces. The taxi fares should be simplified into a flat rate structure. Taxi drivers should be allowed to own a taxi licence and build a taxi business, rather than be renters of taxis.
I agree with these points and will bring them up at the TV program tonight. I will also raise them in other occasions in my blog.
Tan Kin Lian
a. The recent change resulted in a drop of 40% in COE allocation. This caused COE prices to shoot up due to the cut and also to increased demand generated by fear of further price increases. It is better to have a more stable market, rather than fluctuating prices to drive consumer behavior.
b. Taxis are now in the same category as private cars. They should be kept in a spearate category as the owners of taxis are driven by commercial consideration.
c. There is need to improve the feeder services, so that more people will take the train and buses at the interchanges.
d. Taxis should be considered as public transport. They are more efficient than cars and do not require parking spaces. The taxi fares should be simplified into a flat rate structure. Taxi drivers should be allowed to own a taxi licence and build a taxi business, rather than be renters of taxis.
I agree with these points and will bring them up at the TV program tonight. I will also raise them in other occasions in my blog.
Tan Kin Lian
Vera has artistic intelligence
I made the shape of a cat using the tangram pieces. I asked my grand-daughter Vera (3 years old) what is the picture. She looked at it for a short time and said "Cat". Next, I made the shape of a man sitting down. She said, in a naughty manner "House". Later. She said "Man". My tangram book containing 100 puzzles and solutions, will be available soon and can be bought online. I will take advanced orders now.
Tan Kin Lian
Tan Kin Lian
Inadequate savings for retirement
The Sunday Times have an article that showed that many people have inadequate savings for retirement. Why is this the case? The same question was posed to me by a journalist recently. I gave the following reasons:
1. People spent too much money on their property.
2. They got a poor yield on their savings in life insurance policies, due to the high charges which takes away more than 30% of their accumulated savings
3. They were badly advised by insurance agents to switch from an earlier policy to a new policy, incurring the high upfront charges again. This can occur several times during a working lifetime.
Better late than never. Consumers should be educated to avoid bad investment decisions. They should spend $12 and 12 hours to read my book, Practical Guide on Financial Planning. This book also contains tips to the consumers on:
a. What to do with their existing life insurance policies
b. What should they do with their future savings?
c. How should they invest their money during retirement?
d. What type of life annuity should they pick?
3. How much should they spend on a property?
They should advise their children to start their working career on a proper footing and avoid making the same mistakes. Order online.
Tan Kin Lian
1. People spent too much money on their property.
2. They got a poor yield on their savings in life insurance policies, due to the high charges which takes away more than 30% of their accumulated savings
3. They were badly advised by insurance agents to switch from an earlier policy to a new policy, incurring the high upfront charges again. This can occur several times during a working lifetime.
Better late than never. Consumers should be educated to avoid bad investment decisions. They should spend $12 and 12 hours to read my book, Practical Guide on Financial Planning. This book also contains tips to the consumers on:
a. What to do with their existing life insurance policies
b. What should they do with their future savings?
c. How should they invest their money during retirement?
d. What type of life annuity should they pick?
3. How much should they spend on a property?
They should advise their children to start their working career on a proper footing and avoid making the same mistakes. Order online.
Tan Kin Lian
Investors of Pinnacle Notes
A US law firm, Kirby McInerney, has spoken to investors about possible legal action that can be taken in US Courts in connection with the Pinnacle Notes. 45 investors have expressed interest to join this action. Other investors of Pinnacle Notes who are interested can send an e-mail to tkla.km@gmail.com quoting the following: your name
mobile phone
email address
amount invested
type of Pinnacle Notes.
Tan Kin Lian
Friday, April 16, 2010
Existing life insurance policies
Many people asked me about their existing life insurance policies - should they keep it or terminate the policy? In many cases, the policies were bought for them by their parents and are now transferred to them to pay the premiums. My usual advice is, "Keep your existing policy. You have already incurred the high upfront cost. Going forward, it should provide you with a modest return. "
However, if they have difficulty in paying the premium or they have better options to invest their savings, they can consider terminating the existing policies. Before they do so, they should calculate the return on the existing policy for the next five years. Read this FAQ.
They should think carefully before they put in more savings in a new life insurance policy. They should NEVER terminate any existing policy to buy a new policy - as it means incurring the high upfront cost all over again. They should avoid the insurance agent who makes this recommendation as the agent usually wants to make commisison at the expense of the client.
Some of these tips are given in my book, Practical Guide on Financial Planning.
Tan Kin Lian
However, if they have difficulty in paying the premium or they have better options to invest their savings, they can consider terminating the existing policies. Before they do so, they should calculate the return on the existing policy for the next five years. Read this FAQ.
They should think carefully before they put in more savings in a new life insurance policy. They should NEVER terminate any existing policy to buy a new policy - as it means incurring the high upfront cost all over again. They should avoid the insurance agent who makes this recommendation as the agent usually wants to make commisison at the expense of the client.
Some of these tips are given in my book, Practical Guide on Financial Planning.
Tan Kin Lian
Tips for young people
I wrote the book, Practical Guide on Financial Planning to educate young people who has just started work, about the importance of savings and the need to invest the savings in a liquid form so that they can be withdrawn without any penalty for urgent cash needs. You can save lot of money by avoiding high interest payments on borrowings or installment payments.
You should NOT lock up their savings in a life assurance policy that has a high distribution cost, poor liquidity and a heavy penalty on withdrawal. Be careful of insruance agents who will approach you soon after you started work. They are well trained to tell one-sided stories about the benefits of life insurance, but not the serious drawbacks.
Do not worry about protecting yourself against the risk of death. You only need to worry about it when you get married. If you can buy a group term insurance (i.e. SAF or SAFRA) or personal accident insurance, go ahead. If not, it does not really matter that you are not insured when you are still young.
Remember: when you sign on the dotted line to buy a high cost insurance policy, you will be giving away one or two years of your hard earned savings.
You should spend $12 and 12 hours to buy and read my book which is available online. By being educated, you can save several thousand dollars by avoiding bad investment products. Do your friend a favour. Order additional copies to sell to them or present as a gift to them. It may be the most valuable gift that you can give them.
Tan Kin Lian
You should NOT lock up their savings in a life assurance policy that has a high distribution cost, poor liquidity and a heavy penalty on withdrawal. Be careful of insruance agents who will approach you soon after you started work. They are well trained to tell one-sided stories about the benefits of life insurance, but not the serious drawbacks.
Do not worry about protecting yourself against the risk of death. You only need to worry about it when you get married. If you can buy a group term insurance (i.e. SAF or SAFRA) or personal accident insurance, go ahead. If not, it does not really matter that you are not insured when you are still young.
Remember: when you sign on the dotted line to buy a high cost insurance policy, you will be giving away one or two years of your hard earned savings.
You should spend $12 and 12 hours to buy and read my book which is available online. By being educated, you can save several thousand dollars by avoiding bad investment products. Do your friend a favour. Order additional copies to sell to them or present as a gift to them. It may be the most valuable gift that you can give them.
Tan Kin Lian
Bid for COE
I found that a car buyer can bid for the COE and, after being successful, is given 6 months to find a car. The deposit to bid for a COE for a car is $10,000 and the balance of the COE price is payable on the purchase of a car.
If you have $10,000 in cash, you can bid for a COE on your own and benefit from any drop in price. You may be negotiate a better price for a car, if you have a COE and can go to shop around. If you do not have $10,000 in cash, perhaps you should not consider buying a car?
If you have $10,000 in cash, you can bid for a COE on your own and benefit from any drop in price. You may be negotiate a better price for a car, if you have a COE and can go to shop around. If you do not have $10,000 in cash, perhaps you should not consider buying a car?
Escalating COE prices
The COE prices has increased sharply due to a reduction in COE available for bidding, and has been exaggerated by greed and fear.
We have to accept that COE prices will be high, due to limited supply and high demand, but we should try to avoid the large fluctuation in prices caused by the current bidding system. The system should be changed to reduce the volatility.
Some people have suggested the "pay as you bid" approach. I think that it has merits. The other change is to make it easier for consumers to bid for COEs directly, instead of relying on the motor dealers to do the bidding. Their profit on the COE increases the cost of ownership.
A better long term strategy is to reduce the demand for private car ownership by improving public transport and the use of taxis.
We have to improve the feeder service to bring commuters from their homes to the MRT stations or bus interchanges. The feeder services should have a waiting time of less than 5 minutes and be affordable (say 40 cetns).
We should also reduce the cost of taxi fares and increase the supply, so that more people can use taxis instead of cars. Each additional taxi on the road can reduce the demand for cars by 5 to 10 times. The cost of taxi fares can come down by reducing the taxis and levies on taxis and by removing unnecessary regulations that add to the cost of operations. If more people uses taxis instead of private cars, there will be less demand for parking spaces.
Tan Kin Lian
We have to accept that COE prices will be high, due to limited supply and high demand, but we should try to avoid the large fluctuation in prices caused by the current bidding system. The system should be changed to reduce the volatility.
Some people have suggested the "pay as you bid" approach. I think that it has merits. The other change is to make it easier for consumers to bid for COEs directly, instead of relying on the motor dealers to do the bidding. Their profit on the COE increases the cost of ownership.
A better long term strategy is to reduce the demand for private car ownership by improving public transport and the use of taxis.
We have to improve the feeder service to bring commuters from their homes to the MRT stations or bus interchanges. The feeder services should have a waiting time of less than 5 minutes and be affordable (say 40 cetns).
We should also reduce the cost of taxi fares and increase the supply, so that more people can use taxis instead of cars. Each additional taxi on the road can reduce the demand for cars by 5 to 10 times. The cost of taxi fares can come down by reducing the taxis and levies on taxis and by removing unnecessary regulations that add to the cost of operations. If more people uses taxis instead of private cars, there will be less demand for parking spaces.
Tan Kin Lian
Thursday, April 15, 2010
Dental health
Recently, I changed my brushing habit. Apart from using the ordinary brush, I spent a minute to use the interdental brush to remove the food particles between the teeth. It was quite easy and is likely to be quite useful.
Like to share your experience on dental health?
Here is a picture of an interdental (christmas tree) brush.
Property market in USA and China
Hi Mr Tan,
Here is an interesting article about the housing crash continuing in US even after all the stimulus.. I suspect that China(Shangai and HK) and eventually Singapore will suffer the same fate. http://patrick.net/housing/crash.html
Here is another interesting article on possible crash of china propery bubble for you to read.
http://www.dailymarkets.com/economy/2010/04/09/jim-chanos-on-the-coming-collapse-of-chinas-property-market/
Here is an interesting article about the housing crash continuing in US even after all the stimulus.. I suspect that China(Shangai and HK) and eventually Singapore will suffer the same fate. http://patrick.net/housing/crash.html
Here is another interesting article on possible crash of china propery bubble for you to read.
http://www.dailymarkets.com/economy/2010/04/09/jim-chanos-on-the-coming-collapse-of-chinas-property-market/
Why Life Insurance Is Not an Investment
Life insurance is one of those things that most of us need but none of us enjoy talking about.
When it does come up in conversations, it’s mostly because someone is complaining about being sold a whole life insurance or variable life insurance that is both expensive and complex, who would be better off with a plain term insurance policy.
http://bucks.blogs.nytimes.com/2010/04/12/why-life-insurance-is-not-an-investment/
My comment
The same message is given in my b ook, Practical Guide on Financial Planning ($12) which is available here. Spend $12 and save a few thousand dollars by avoiding a bad investment.
When it does come up in conversations, it’s mostly because someone is complaining about being sold a whole life insurance or variable life insurance that is both expensive and complex, who would be better off with a plain term insurance policy.
http://bucks.blogs.nytimes.com/2010/04/12/why-life-insurance-is-not-an-investment/
My comment
The same message is given in my b ook, Practical Guide on Financial Planning ($12) which is available here. Spend $12 and save a few thousand dollars by avoiding a bad investment.
Develop thinking skills with puzzles
Singaporeans need to develop the ability to think independent and to solve problems, rather than rely on their bosses for detailed instructions at every step of the way. This confidence and skill can come from a liberal arts education and can also be developed through practical training.
I have created four puzzles (i.e. tangram, shape quiz, einstein quiz and sudoku) that are useful in developing the thinking skills. These puzzles can be downloaded here. Watch these videos to learn about how these puzzles help to develop the thining skills.
You can buy the puzzle books here. Spend some time to learn the thinking skills and develop the confidence through practice. It is also fun and interesting.
Tan Kin Lian
I have created four puzzles (i.e. tangram, shape quiz, einstein quiz and sudoku) that are useful in developing the thinking skills. These puzzles can be downloaded here. Watch these videos to learn about how these puzzles help to develop the thining skills.
You can buy the puzzle books here. Spend some time to learn the thinking skills and develop the confidence through practice. It is also fun and interesting.
Tan Kin Lian
Wednesday, April 14, 2010
Singapore Talking - COE, 10.30 pm Sunday 18 April
I have been invited to be in the panel on Singapore Talking this Sunday at 10.30 pm on Mediacorp TV. The topic is on the high price of COE. I will be giving my views about moderating the fluctuation in price of COE and more importantly, about making public transport and taxis more comfortable and affordable.
Good signages to show directions
It is important to provide good signages to help people to find their way. In recent years, there is too much focus on getting revenue for advertisements that result in signages being hidden or difficult to find. Here are some examples:
1. Whole buses are now being painted as a moving advertisement. It is difficult for the commuter to know if it is a public bus.
2. There are many advertisements in MRT stations and bus interchanges that the essential signages, such as EXIT and PLATFORM number, are difficult to find.
3. Even gantry gates of car parks are being converted into advertisements for property agencies.
When I visit an unfamiliar place, I have a lot of difficulty to find the way due to poor signages, but I get distracted by many advertisements.
There has to be a balance between the desire for advertising revenue and the need to give property signages and instructions to commuters. I hope that the regulatory authority comes into the picture. If the transport operators are restricted in their advertisements, it will create opportunity for other media, such as the newspapers and the television. This may be better for all.
Tan Kin Lian
1. Whole buses are now being painted as a moving advertisement. It is difficult for the commuter to know if it is a public bus.
2. There are many advertisements in MRT stations and bus interchanges that the essential signages, such as EXIT and PLATFORM number, are difficult to find.
3. Even gantry gates of car parks are being converted into advertisements for property agencies.
When I visit an unfamiliar place, I have a lot of difficulty to find the way due to poor signages, but I get distracted by many advertisements.
There has to be a balance between the desire for advertising revenue and the need to give property signages and instructions to commuters. I hope that the regulatory authority comes into the picture. If the transport operators are restricted in their advertisements, it will create opportunity for other media, such as the newspapers and the television. This may be better for all.
Tan Kin Lian
Consumers can force reforms
Read this post in FISCA about the work being done by the Consumer Union of USA to force reform of bad practices. Join FISCA to strengthen consumer protection and education!
New MRT interchange stations
The best interchange stations were at City Hall and Raffles Place. It was possible to change from one line to another on the same level. This was possible as the two lines were developed at the same time.
The worst interchange stations were at Outram Park and Dhoby Ghaut. The commuter has to walk a long distance to change from one line to another. Similarly, the walking distance between the two lines at Bishan is quite far. When a new line is built at a later time, after an existing line is operational, it is necessary to build the station at a distance from the existing station, due to safety and engineering reasons.
But there is another approach that allows the interchange stations to be build close together to reduce the walking time. In developing the new station, it is possible to build a new platform for the existing line, and to divert the existing line to use the new platform at a later date. I hope that the engineers consider this possiblity, so that the walking distance is reduced.
Tan Kin Lian
The worst interchange stations were at Outram Park and Dhoby Ghaut. The commuter has to walk a long distance to change from one line to another. Similarly, the walking distance between the two lines at Bishan is quite far. When a new line is built at a later time, after an existing line is operational, it is necessary to build the station at a distance from the existing station, due to safety and engineering reasons.
But there is another approach that allows the interchange stations to be build close together to reduce the walking time. In developing the new station, it is possible to build a new platform for the existing line, and to divert the existing line to use the new platform at a later date. I hope that the engineers consider this possiblity, so that the walking distance is reduced.
Tan Kin Lian
Polite drivers
Recently, I found a few instances of polite drivers on the roads in Singapore. On two occasions, I had to change lane at the last minute, due to unfamiliarity with the road. The cars behind slowed down to let me pass. They did not sound the horn.
On another occasion, I was waiting to make a left turn. I was temporarily distracted and waited much longer than needed. The car behind waited for one minute before sounding the horn softly to remind me. It was quite nice of the driver.
Tan Kin Lian
On another occasion, I was waiting to make a left turn. I was temporarily distracted and waited much longer than needed. The car behind waited for one minute before sounding the horn softly to remind me. It was quite nice of the driver.
Tan Kin Lian
Autograph session for Financial Planning Book
I will be at MPH at Citilink Mall (1 Raffles Link, Basement B1-26A) at 7.pm to 8.30 pm on Friday 16 April for an autograph session of my book, Practical Guide on Financial Planning. If you are interested to buy an autographed copy of my book, please turn up for this session - no need to pre-register. Pass the word around to your friends.
Land banking story on Channel NewsAsia
Channel NewsAsia interviewed me for a story on land banking. It will be telecast on Sunday 18 April, 9.30 pm. A staff of a land banking company has also said that the boss of that company has also be interviewed.
Adjudication in FIDREC
Some people have complained that they were unfairly treated at the FIDREC adjudication hearing. Perhaps they form a minority and that other cases had been handled satisfactorily and fairly. I invite you to share your story in this survey. I may use some of these stories to provide feedback to the appropirate persons, but will not reveal your identity.
Transport woes in Singapore
Read this article.
My comment
The solution is to improve public transport in Singapore and to make better use of taxis. More taxis should be put on the road and the cost of taxi fares should be reduced, e.g. by removing some of the tax on taxis and treating them as public transport.
My comment
The solution is to improve public transport in Singapore and to make better use of taxis. More taxis should be put on the road and the cost of taxi fares should be reduced, e.g. by removing some of the tax on taxis and treating them as public transport.
Selling life insurance
There were some questions asked about how a life insurance agent can make a living, if the agent only sell term insurance to earn a low rate of commission.
Here is my answer. Similar to a general insurance agent or a stockbroker or a doctor. Earn a remuneration that is based on the value of the service that is given to the client, and not a high rate of commission that exploits the ignorance of the client.
A general insurance agent earns a commission of 15% on the premium that is paid to cover the risk. In Europe, the commission for motor insurance has decreased to 5% of premium, as the premium is high and the work involved is routine. The insurance agent can still make a living.
A stockbroker charges a commission of 0.3% of the invested sum, share between the firm and the remisier. They do not have to take away 150% of the annual amount of savings.
The doctor earns a fee based on the time spent on consultation and a markup on the medication. Due to competition, the fee is reduced to a rate that the ordinary people can afford. The doctor has to pay the rental of the clinic and the staff to man the reception.
Life insurance sales can also be made using the above approaches. Many people need a large amount of term insurance, say $500,000. They also need disability insurance and medical expense insurance. They can afford to spend up to 2% of their earnings (say $500 to $800 a year) to cover these personal risks. A 15% commision on this premium can be quite attractive.
The life insurance companies have to change its mode of marketing. Most importantly, they have to remember their responsibility to provide good value products and take care of the financial well-being of their clients.
Tan Kin Lian
Here is my answer. Similar to a general insurance agent or a stockbroker or a doctor. Earn a remuneration that is based on the value of the service that is given to the client, and not a high rate of commission that exploits the ignorance of the client.
A general insurance agent earns a commission of 15% on the premium that is paid to cover the risk. In Europe, the commission for motor insurance has decreased to 5% of premium, as the premium is high and the work involved is routine. The insurance agent can still make a living.
A stockbroker charges a commission of 0.3% of the invested sum, share between the firm and the remisier. They do not have to take away 150% of the annual amount of savings.
The doctor earns a fee based on the time spent on consultation and a markup on the medication. Due to competition, the fee is reduced to a rate that the ordinary people can afford. The doctor has to pay the rental of the clinic and the staff to man the reception.
Life insurance sales can also be made using the above approaches. Many people need a large amount of term insurance, say $500,000. They also need disability insurance and medical expense insurance. They can afford to spend up to 2% of their earnings (say $500 to $800 a year) to cover these personal risks. A 15% commision on this premium can be quite attractive.
The life insurance companies have to change its mode of marketing. Most importantly, they have to remember their responsibility to provide good value products and take care of the financial well-being of their clients.
Tan Kin Lian
Experience of an insurance agent
Dear Mr. Tan,
As im currently a new agent with one of the big insurance companies in Singapore, im finding its a lot different from what I was told or expected.
For example at the start we were told to emphasize needs based selling in order to meet the needs of our clients (basically what the MAS regulations said). Later I found out that nobody does needs based selling and all we do is get clients to sign on empty forms so we can go back to the office to fill them up later. End result : Client is clueless about what their needs are and how we are meeting them, if at all. Instead of talking to them about what THEY want, we spend our time giving presentations about interest rates and talking about how our relative racked up a huge hospital bill without insurance to pay for it.
The commission structure is also highly flawed and contributes to the high turnover rate of agents in the industry. There is absolutely zero incentive or point for agents to recommend products with lower commission rates. In fact, meeting a client to sell a term plan actually loses an agent money(unless it is a very big term plan) because the commission rate is simply not high enough to pay for the time + bus/MRT fare involved.
In my case, neither I or my colleagues were ever given product training on anything but the products with the highest commission rates. Also, this is actually a job that requires you to spend money in order to make money. The problem is that for most new agents, they will not be able to set sufficient appointments or close enough cases to make money for the first 1-2 months at least, unless they have a lot of contacts who are interested. The end result is they spend hundreds of dollars in food and transport expenses, and in the end all they keep hearing is "I'm not interested", and quit because they are heavily in the red and still can't find people who wants to buy insurance. It would be better if new agents were given a basic allowance of $400-500 for living expenses till they are seasoned enough to close cases on a regular basis.
With the high turnover rate of agents in the industry there is a high incentive to simply not train agents properly since a manager is spending too much time training someone who, according to statistics, will quit in a month or two anyway. Simply give them basic training, send them on whatever appointments they can make, and see if it works out. If not, oh well, go recruit more people. I was given a few days of training total, only a few hours of which was product related, and was told to go to my first appointment with the aim to do a presentation and simply convince him to buy and not ask questions. I ended up making stuff up when the client started asking about things I was not taught about. I felt pathetic.
As it is I am currently in the unenviable situation where I spend money travelling back and fro my office, making phone calls, doing surveys, doing coldcalls, mainly to hear phones ringing that people never seem to pick up (I never had any idea how under-utilzied handphones were in Singapore before) and I am not even able to set a single appointment because people keep postponing or simply dissapear off the radar and never pick up their phones again. All of this is costing me money and worst of all I cannot see a way to improve my situation. I do not have any senior agents I can look to for guidance since they are all busy rushing to meet quotas and my manager just keeps telling me to go out, do more surveys, make more phone calls, find and meet people, etc, but it is simply not working.
I have no clue where, exactly, I am supposed to find people interested in buying insurance or doing investments since almost everyone i meet simply recoils in horror at the mere mention of "savings" "investments" "protection" or any other key word that you can possibly use.
A scary amount of middle aged adults still believe themselves immortal and that they cannot possibly get hospitalized or worse, affecting their ability to provide for their family. Most young working adults simply go from paycheck to paycheck, saving $0 every month and heading straight for disaster the moment a situation calls for usage of emergency funds which do not exist, or they just dump a token amount into their bank account every month that dissapears into the newest xbox or ipod the moment they get enough. Most young working adults do not even have a clue what medishield or medisave is, other than that it is something CPF related.
I feel like im constantly rolling dice and seeing if I can get a lucky combination just to find a single interested person. I would like to continue on in this line of advising people on financial planning, but I do not see how as most people simply want to go through life without any financial planning or insurance protection at all. And actually I don't even know whether what im doing can be considered financial planning anyway.
As im currently a new agent with one of the big insurance companies in Singapore, im finding its a lot different from what I was told or expected.
For example at the start we were told to emphasize needs based selling in order to meet the needs of our clients (basically what the MAS regulations said). Later I found out that nobody does needs based selling and all we do is get clients to sign on empty forms so we can go back to the office to fill them up later. End result : Client is clueless about what their needs are and how we are meeting them, if at all. Instead of talking to them about what THEY want, we spend our time giving presentations about interest rates and talking about how our relative racked up a huge hospital bill without insurance to pay for it.
The commission structure is also highly flawed and contributes to the high turnover rate of agents in the industry. There is absolutely zero incentive or point for agents to recommend products with lower commission rates. In fact, meeting a client to sell a term plan actually loses an agent money(unless it is a very big term plan) because the commission rate is simply not high enough to pay for the time + bus/MRT fare involved.
In my case, neither I or my colleagues were ever given product training on anything but the products with the highest commission rates. Also, this is actually a job that requires you to spend money in order to make money. The problem is that for most new agents, they will not be able to set sufficient appointments or close enough cases to make money for the first 1-2 months at least, unless they have a lot of contacts who are interested. The end result is they spend hundreds of dollars in food and transport expenses, and in the end all they keep hearing is "I'm not interested", and quit because they are heavily in the red and still can't find people who wants to buy insurance. It would be better if new agents were given a basic allowance of $400-500 for living expenses till they are seasoned enough to close cases on a regular basis.
With the high turnover rate of agents in the industry there is a high incentive to simply not train agents properly since a manager is spending too much time training someone who, according to statistics, will quit in a month or two anyway. Simply give them basic training, send them on whatever appointments they can make, and see if it works out. If not, oh well, go recruit more people. I was given a few days of training total, only a few hours of which was product related, and was told to go to my first appointment with the aim to do a presentation and simply convince him to buy and not ask questions. I ended up making stuff up when the client started asking about things I was not taught about. I felt pathetic.
As it is I am currently in the unenviable situation where I spend money travelling back and fro my office, making phone calls, doing surveys, doing coldcalls, mainly to hear phones ringing that people never seem to pick up (I never had any idea how under-utilzied handphones were in Singapore before) and I am not even able to set a single appointment because people keep postponing or simply dissapear off the radar and never pick up their phones again. All of this is costing me money and worst of all I cannot see a way to improve my situation. I do not have any senior agents I can look to for guidance since they are all busy rushing to meet quotas and my manager just keeps telling me to go out, do more surveys, make more phone calls, find and meet people, etc, but it is simply not working.
I have no clue where, exactly, I am supposed to find people interested in buying insurance or doing investments since almost everyone i meet simply recoils in horror at the mere mention of "savings" "investments" "protection" or any other key word that you can possibly use.
A scary amount of middle aged adults still believe themselves immortal and that they cannot possibly get hospitalized or worse, affecting their ability to provide for their family. Most young working adults simply go from paycheck to paycheck, saving $0 every month and heading straight for disaster the moment a situation calls for usage of emergency funds which do not exist, or they just dump a token amount into their bank account every month that dissapears into the newest xbox or ipod the moment they get enough. Most young working adults do not even have a clue what medishield or medisave is, other than that it is something CPF related.
I feel like im constantly rolling dice and seeing if I can get a lucky combination just to find a single interested person. I would like to continue on in this line of advising people on financial planning, but I do not see how as most people simply want to go through life without any financial planning or insurance protection at all. And actually I don't even know whether what im doing can be considered financial planning anyway.
How to spot a ponzi scheme
An early example of a ponzi scheme in Singapore was the Gemini Chit Fund that was promoted 40 years ago. Here is a brief story about this it. A more recent example is the Sunshine Empire.
In a ponzi scheme, the promoter promised you an attractive return. The early investors received that return. They were excited and put in more money. They encouraged their friends to join in the investment. The promoter was able to use the money received later to pay off the attractive return to the earlier investors. As long as more money came in, compared to the payouts, the promoter was able to continue to operate the sheme. During this time, the promoter was also able to siphon off the surplus into their pockets. When the ponzi scheme collapsed, all the remaining investors lost all of their money.
In terms of size, nothing beats the ponzi scheme operated by Bernie Madoff in USA, as described in this story.
There are many ponzi schemes now being operated in Singapore today. The mode of operation is the same. The story could be the fantastic growth of land plots, wine, industrical chemicals or other products. Heard them?
In a ponzi scheme, the promoter promised you an attractive return. The early investors received that return. They were excited and put in more money. They encouraged their friends to join in the investment. The promoter was able to use the money received later to pay off the attractive return to the earlier investors. As long as more money came in, compared to the payouts, the promoter was able to continue to operate the sheme. During this time, the promoter was also able to siphon off the surplus into their pockets. When the ponzi scheme collapsed, all the remaining investors lost all of their money.
In terms of size, nothing beats the ponzi scheme operated by Bernie Madoff in USA, as described in this story.
There are many ponzi schemes now being operated in Singapore today. The mode of operation is the same. The story could be the fantastic growth of land plots, wine, industrical chemicals or other products. Heard them?
Tuesday, April 13, 2010
Retirement savings
Read this article,
My view.
It seems that the average amount that most people need for retirement in the USA is $1 million. I suppose that this include the value of the house. A similar amount will be needed in Singapore, i.e. $500,000 as value of house and $500,000 cash for retirement. At 4% yield (hopefully), $500,000 will produce $20,000 a year or $1,600 a month. This is similar to what most people comments in an earlier article in my blog.
However, if I am mistaken and most people expect $1 million cash on top of a fully paid house, then they are looking at monthly expenses of $3,200.
My view.
It seems that the average amount that most people need for retirement in the USA is $1 million. I suppose that this include the value of the house. A similar amount will be needed in Singapore, i.e. $500,000 as value of house and $500,000 cash for retirement. At 4% yield (hopefully), $500,000 will produce $20,000 a year or $1,600 a month. This is similar to what most people comments in an earlier article in my blog.
However, if I am mistaken and most people expect $1 million cash on top of a fully paid house, then they are looking at monthly expenses of $3,200.
Confidence in leaders
Dear Mr. Tan,
I fully agree with an article on your blog (The future of our country). I have very little confidence in the next generation of leaders. All of them have never contested in a fair and open election, thanks to the grossly unleveled playing field (eg. GRC, ruling party's use of the entire govt machinery against the opposition party cadres, heavily biased and tightly controlled mainstream media).
How can they claim to represent the people if they are not elected by the people? This explains why they don't have any clue what the people feel/think. They just enact policies according to their liking. They think they know best. They don't have the decency to apologise when they are wrong.
This sad state of affairs worries me. I now seriously wonder if I should get PR status in say Australia. Having a team of "strawberry" leaders, who make policies out of an ivory yower, steering this country scares me like hell.
I fully agree with an article on your blog (The future of our country). I have very little confidence in the next generation of leaders. All of them have never contested in a fair and open election, thanks to the grossly unleveled playing field (eg. GRC, ruling party's use of the entire govt machinery against the opposition party cadres, heavily biased and tightly controlled mainstream media).
How can they claim to represent the people if they are not elected by the people? This explains why they don't have any clue what the people feel/think. They just enact policies according to their liking. They think they know best. They don't have the decency to apologise when they are wrong.
This sad state of affairs worries me. I now seriously wonder if I should get PR status in say Australia. Having a team of "strawberry" leaders, who make policies out of an ivory yower, steering this country scares me like hell.
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