Saturday, September 15, 2007

A flexible product

It is advisable to invest in a flexible product which does not lock you up for many years. This product has no entry or exit charges, apart from a small transaction charge.

Examples of a flexible product:

* saving account
* short term fixed deposits
* no-load investment fund (with no exit penalty).

Examles of non-flexible products:

* traditional endowment and whole life policies
* structured products

The non-flexible products usually has high marketing costs. To recover this cost, the product has to be locked up for many years. If it is terminated early, there will be high charges.


Anonymous said...

If you read Doc. Money's advice the best approach is to DIY. It does not mean you don't need an adviser but it does mean you need to have a good adviser who has your interest at heart. Someone who will go through with you your needs FIRST and then IDENTIFY the best product or means to address them. Not some insurance agents who thrust a product into your face and tell you what the product can do for you, for this and for that.
It is like a product that can cure everything.If it does help you it is luck.
Follow Mr. Tan's guidelines to test
the products recommended to you; do they meet your needs efficiently and at lowest cost? Do I get locked up for a long time?Is there a conflict of interest?
I hope my contribution helps a bit.
Thank you, Mr. Tan for allowing me to offer my humble view.

Anonymous said...

Nowadays, either you get a new kid on the block products or you get a kid making a new comeback.
Examples of new kid on the block products are structured products at one corner and at the other corner
are "restructured" products like a traditional crossed with ILPs or some other things, making new comeback.
It is confusing and the buying public is completely fooled by the new outward dressing. And with the insurers or manufacturers drumming up with heavy advertising and promotions many will be fooled into the frenzy.
Have they gone bankrupt in new ideas that they are resorting to product "differentiation" strategy by cut and paste method? If value is added it is okay but many either require the customers to take more risk or accept lower return. I think the whole affair is conspiracy to con the public.
Back to basics is still better for customers.

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