Someone asked if she should sell her SingTel shares at the Post Office now, as she heard that this service will be discontinued in March.
I asked my stockbroker for advice. He said that a shareholder who does not have a trading account with a stockbroker will find it better to sell the shares at the Post Office. It will be quite inconvenient to open an account and link to the CDP account, just to sell the SingTel shares.
However, if the shareholder has a trading account, then it is quite convenient to sell through the stockbroker.
He is not aware that the Post Office intends to withdraw this service.
Wednesday, February 07, 2007
Poor return from Umbrella policy
Dear Mr Tan
I purchased the Umbrella policy in 1992, with a death/ permenant disability benefit of $50,000. My quarterly premium was $185.65. At that time, it was a popular product with good value for money.
However, 15 years on, I am a little disappointed with the value, as the policy bas not reached the break-even point. I have paid $11,000 in total premium, but the cash value to date is $10,009. This figure is lower than that projected in the quotation given to me at that time.
I would like to hear your comments on this policy.
PS. Last but not least, let me commend you for building Income into one of the most successful Insurance big boys it is today. Such is my confidence in Income that I had bought 3 other life policies and 4 Incomeshield Shield policies for myself and 3 dependents. Your impending departure would indeed be a loss to Income.
M
----------------------
Dear M
The Umbrella policy has a long break even point as it provides a relatively high coverage, compared to the premium.
Actually, the break even point should have occurred earlier, but this was extended due to the reduction in bonus rates during 2003 and 2004. The bonus rates have since been increased on two occasions. There will be a further increase in bonus rate this year.
I hope that, going forward, you will see the cash value increase at a faster rate.
With best wishes to you.
Tan Kin Lian
I purchased the Umbrella policy in 1992, with a death/ permenant disability benefit of $50,000. My quarterly premium was $185.65. At that time, it was a popular product with good value for money.
However, 15 years on, I am a little disappointed with the value, as the policy bas not reached the break-even point. I have paid $11,000 in total premium, but the cash value to date is $10,009. This figure is lower than that projected in the quotation given to me at that time.
I would like to hear your comments on this policy.
PS. Last but not least, let me commend you for building Income into one of the most successful Insurance big boys it is today. Such is my confidence in Income that I had bought 3 other life policies and 4 Incomeshield Shield policies for myself and 3 dependents. Your impending departure would indeed be a loss to Income.
M
----------------------
Dear M
The Umbrella policy has a long break even point as it provides a relatively high coverage, compared to the premium.
Actually, the break even point should have occurred earlier, but this was extended due to the reduction in bonus rates during 2003 and 2004. The bonus rates have since been increased on two occasions. There will be a further increase in bonus rate this year.
I hope that, going forward, you will see the cash value increase at a faster rate.
With best wishes to you.
Tan Kin Lian
Tuesday, February 06, 2007
eServices at South West CDC
South West Community Development Council (South West CDC) serves about one fifth of Singapore.
It's website has a directory of the social services provided in the district. It can be accessed easily through
SWCDC
e-Services
The services include:
Kindergarten
Child Care
Student Care
Disability
Medical
Eldercare
Education
Family
For example, it lists details of 100 kindergartens operating in the district.
It's website has a directory of the social services provided in the district. It can be accessed easily through
SWCDC
e-Services
The services include:
Kindergarten
Child Care
Student Care
Disability
Medical
Eldercare
Education
Family
For example, it lists details of 100 kindergartens operating in the district.
A hybrid plan
Hi Mr Tan,
Most of the insurance advice I see available seems to be around the two extremes:
- whole life policy
- term policy + invest the difference
My thoughts:-
Whole-life: Pro:whole life coverage with bonuses, Con: expensive
Term: Pro: cheap, Con: no coverage beyond end of term (high chance of outliving the policy)
Why is it that nobody mentions a hybrid solution? e.g. for a desired 100k sum assured, buy 50k whole life, 50k decreasing term. Over the course of the two policies, the bonuses added to the whole life plan will balance out with the decreasing term coverage. Costs are kept reasonable and coverage will last the entire lifetime.
BK
--------------
Dear BK
Your hybrid solution is quite good. Well done.
Under the buy term and invest the difference, it is likely that the savings with capital gains will be more than the sum assured at the end of the term of 20 years. So, there is no need to have any more insurance cover.
For example, if you are insured for $100,000 and you save $4,000 a year, the total savings with capital gains should be more than $100,000 at the end of 20 years
Tan Kin Lian
Most of the insurance advice I see available seems to be around the two extremes:
- whole life policy
- term policy + invest the difference
My thoughts:-
Whole-life: Pro:whole life coverage with bonuses, Con: expensive
Term: Pro: cheap, Con: no coverage beyond end of term (high chance of outliving the policy)
Why is it that nobody mentions a hybrid solution? e.g. for a desired 100k sum assured, buy 50k whole life, 50k decreasing term. Over the course of the two policies, the bonuses added to the whole life plan will balance out with the decreasing term coverage. Costs are kept reasonable and coverage will last the entire lifetime.
BK
--------------
Dear BK
Your hybrid solution is quite good. Well done.
Under the buy term and invest the difference, it is likely that the savings with capital gains will be more than the sum assured at the end of the term of 20 years. So, there is no need to have any more insurance cover.
For example, if you are insured for $100,000 and you save $4,000 a year, the total savings with capital gains should be more than $100,000 at the end of 20 years
Tan Kin Lian
Volatile Singapore Stockmarket
Here are the years when the stock market moved up and down by a big margin
1993 (1 yr) up 1000 points
1997-98 (2 yrs) down 1000 points
1999 (1 yr) up 1500 points
2000-02 (3 yrs) down 1200 points
2003-06 (3 yrs) up 1900 points
When will the market correct? And by how much?
1993 (1 yr) up 1000 points
1997-98 (2 yrs) down 1000 points
1999 (1 yr) up 1500 points
2000-02 (3 yrs) down 1200 points
2003-06 (3 yrs) up 1900 points
When will the market correct? And by how much?
Monday, February 05, 2007
Looking for a part time Personal Assistant
UPDATE: I HAVE RECEIVED MANY RESPONSES TO THIS ADVERTISEMENT. I AM LIKELY TO FIND A SUITABLE CANDIDATE FROM THOSE THAT HAVE RESPONDED. I WILL ONLY DECIDE IN A FEW WEEK'S TIME. I WILL NOT BE REPLYING TO NEW RESPONSES. SORRY.
----------------------------------------------------------------------
I wish to look for a part time Personal Assistant.
The candidate has to be familiar with Microsoft office software, access information on the internet, able to contact people over the telephone and e-mail, arrange travel and appointments, look after administrative matters.
The candidate can work from home. My work should take just a few hours each week. I will send my requests by e-mail. Perferably, the candidate should live in Ang Mo Kio, Bishan or Toa Payoh.
If you or your friend are interested, send a resume to me at kinlian@gmail.com. The starting date is around 1 April 2007.
----------------------------------------------------------------------
I wish to look for a part time Personal Assistant.
The candidate has to be familiar with Microsoft office software, access information on the internet, able to contact people over the telephone and e-mail, arrange travel and appointments, look after administrative matters.
The candidate can work from home. My work should take just a few hours each week. I will send my requests by e-mail. Perferably, the candidate should live in Ang Mo Kio, Bishan or Toa Payoh.
If you or your friend are interested, send a resume to me at kinlian@gmail.com. The starting date is around 1 April 2007.
Website to learn about insurance
There is a website that you can learn about insurance.
KnowYourInsurance
It is easy to learn and fun. You can take a test to check your understanding. Each topic should take only 20 minutes, or less.
About 300 people visit this website everyday. 40 learned a topic and 15 took the test.
You have the chance to win the following:
* Logic9 pocketbook
* Creative Divi Cam 428 worth $329.00!
Some popular topics:
Investment Linked Plan
Travel Insurance
Medical Insurance
Saving for Education
Life Annuity
Home Insurance
Nomination of Beneficiary
Personal Accident
Personal Accident Infectious Disease Plan (PA+ID)
Reverse Mortgage
Living Policy
and others.
KnowYourInsurance
It is easy to learn and fun. You can take a test to check your understanding. Each topic should take only 20 minutes, or less.
About 300 people visit this website everyday. 40 learned a topic and 15 took the test.
You have the chance to win the following:
* Logic9 pocketbook
* Creative Divi Cam 428 worth $329.00!
Some popular topics:
Investment Linked Plan
Travel Insurance
Medical Insurance
Saving for Education
Life Annuity
Home Insurance
Nomination of Beneficiary
Personal Accident
Personal Accident Infectious Disease Plan (PA+ID)
Reverse Mortgage
Living Policy
and others.
Can I change my fund to reduce risk?
Dear Mr Tan
I have the followings 2 policies which was purchased 13 years ago.
1) Investment Linked Insurance
This living policy was bought in 1996 and the premium invest in the Singapore Managed Fund, as at today cash value returns is about breakeven of the total premium I had paid and I believe this is becasue of the recent good performance of the SGX.
Please advice how can I protect the cash value as it depends on the performance of the stock markets. Should I switch to another fund eg their Asia or Global Fund?.
2) Asian Equity Fund
I have invested in this fund for about 10 years the value now is about 70% more than the capital I have invested. Should I cash out this investment now or leave it?
W
-------------------
Dear W
I suggest the you ask the insurance company to tell you the charges that you have to bear for the following:
* annual fund management fee
* mortality charge
You should also compare the performance of the fund with similar funds in the same category in the CPFIS website.
It is difficult to make a judgement on timing. I decided to sell my STI tracker fund about two months ago, and the market has increased by 20% since.
In my case, I felt that the market was too high and decided to take profit. I invested my proceeds in the money market fund of NTUC Income to earn 3% interest.
See www.income.coop/faq on Flexi Cash.
All the best for your decision.
Tan Kin Lian
I have the followings 2 policies which was purchased 13 years ago.
1) Investment Linked Insurance
This living policy was bought in 1996 and the premium invest in the Singapore Managed Fund, as at today cash value returns is about breakeven of the total premium I had paid and I believe this is becasue of the recent good performance of the SGX.
Please advice how can I protect the cash value as it depends on the performance of the stock markets. Should I switch to another fund eg their Asia or Global Fund?.
2) Asian Equity Fund
I have invested in this fund for about 10 years the value now is about 70% more than the capital I have invested. Should I cash out this investment now or leave it?
W
-------------------
Dear W
I suggest the you ask the insurance company to tell you the charges that you have to bear for the following:
* annual fund management fee
* mortality charge
You should also compare the performance of the fund with similar funds in the same category in the CPFIS website.
It is difficult to make a judgement on timing. I decided to sell my STI tracker fund about two months ago, and the market has increased by 20% since.
In my case, I felt that the market was too high and decided to take profit. I invested my proceeds in the money market fund of NTUC Income to earn 3% interest.
See www.income.coop/faq on Flexi Cash.
All the best for your decision.
Tan Kin Lian
Sunday, February 04, 2007
Every 6 years?
The Singapore stockmarket perform well every 6 years. It reached a peak in 1994, 2000 and 2006.
It dipped in 1996 (Asian Financial crisis) and 2002 (corporate scandals), ie about 2 years after reaching its high point. Will it crash in 2008?
I observe that the markets moved up to a very high level when the foreign funds move in. After making the profit, the foreign funds take profit and moved out. This caused the market to fall significantly.
Be careful. Watch out for the outflow of the foreign funds.
It dipped in 1996 (Asian Financial crisis) and 2002 (corporate scandals), ie about 2 years after reaching its high point. Will it crash in 2008?
I observe that the markets moved up to a very high level when the foreign funds move in. After making the profit, the foreign funds take profit and moved out. This caused the market to fall significantly.
Be careful. Watch out for the outflow of the foreign funds.
Part Time Work for Seniors
I will try to build up a demand for part time work for seniors, between age 50 to 75.
The suitable work are those around the neighbourhood. This is to avoid travel long distance. The types of work are:
* customer service in shops, bus terminus, MRT stations
* nursing and care of elderly, children and disabled
* administrative work to support small business
A suitable rate is $6 per hour. A higher rate is justified for work that require special skills.
The part time work can be for 25 hours a week or 100 hours a month. At the rate of $6, the earnings can be $600. The government provides the Workfare Bonus which can add another $50 a month.
As the seniors have probably retired from full time work, a monthly income of $600 to $800 can be a useful supplement to their savings. It is also useful to keep occupied.
I hope that this can lead to the creation of many service jobs in the neighbourhood.
The suitable work are those around the neighbourhood. This is to avoid travel long distance. The types of work are:
* customer service in shops, bus terminus, MRT stations
* nursing and care of elderly, children and disabled
* administrative work to support small business
A suitable rate is $6 per hour. A higher rate is justified for work that require special skills.
The part time work can be for 25 hours a week or 100 hours a month. At the rate of $6, the earnings can be $600. The government provides the Workfare Bonus which can add another $50 a month.
As the seniors have probably retired from full time work, a monthly income of $600 to $800 can be a useful supplement to their savings. It is also useful to keep occupied.
I hope that this can lead to the creation of many service jobs in the neighbourhood.
Traffic Congestion in Many Cities
Most cities around the world face the problem of traffic congestion.
What is the underlying cause? Poor public transport system. It forces many people to buy their personal cars. This adds to the traffic congestion problem. Things get worse.
Our traffic system in Singapore used to be quite good. In recent years, the roads are getting congested. We are facing the same problem as other cities.
Here are my views on how to tackle the underlying problems:
* put more buses and trains on the road
* make supply more than demand
* this will encourage more people to use the public transport
* during the initial period for each route, there is a deficit that needs to be financed by tax revenue
* the operations can be managed by a private operator, with a subsidy for the initial period
* the private operator can tender to run the service
* the charges are fixed
Using this approach, the private operator will have the incentive to operate efficiently. There is a public service that will attract commuters to use it (as it is partially financed by tax revenue). When more people use public transport, there will be less cars on the road.
I hope that my concept can be tried.
What is the underlying cause? Poor public transport system. It forces many people to buy their personal cars. This adds to the traffic congestion problem. Things get worse.
Our traffic system in Singapore used to be quite good. In recent years, the roads are getting congested. We are facing the same problem as other cities.
Here are my views on how to tackle the underlying problems:
* put more buses and trains on the road
* make supply more than demand
* this will encourage more people to use the public transport
* during the initial period for each route, there is a deficit that needs to be financed by tax revenue
* the operations can be managed by a private operator, with a subsidy for the initial period
* the private operator can tender to run the service
* the charges are fixed
Using this approach, the private operator will have the incentive to operate efficiently. There is a public service that will attract commuters to use it (as it is partially financed by tax revenue). When more people use public transport, there will be less cars on the road.
I hope that my concept can be tried.
Choice of Insurance Plans
Many people are confused with the common insurance plans.
Here is a brief description of the various insurance plans provided by NTUC Income. It helps the consumer to decide of the following plans.
Protection - whole life policy to pay the sum assured plus bonus on death
Living - whole life policy to pay the sum assured plus bonus on death or on the confirmed diagnosis of any of 30 dread disease
20 year Term - pays the sum assured on death during the term; policy cease at the end of the term
20 year Decreasing Term - pays the sum assured on death during the term; the sum assured reduces by 5% each year during the term
20 year Living benefit - pays the sum assured on death or occurence of any of 30 dread disease during the term.
To decide on the plan that suits your budget, you need to know approximately how much each plan cost, and the amount of insurance that you can afford.
You can find some sample figures at
Insurance Plans
Other Tips
Personal Website
Here is a brief description of the various insurance plans provided by NTUC Income. It helps the consumer to decide of the following plans.
Protection - whole life policy to pay the sum assured plus bonus on death
Living - whole life policy to pay the sum assured plus bonus on death or on the confirmed diagnosis of any of 30 dread disease
20 year Term - pays the sum assured on death during the term; policy cease at the end of the term
20 year Decreasing Term - pays the sum assured on death during the term; the sum assured reduces by 5% each year during the term
20 year Living benefit - pays the sum assured on death or occurence of any of 30 dread disease during the term.
To decide on the plan that suits your budget, you need to know approximately how much each plan cost, and the amount of insurance that you can afford.
You can find some sample figures at
Insurance Plans
Other Tips
Personal Website
Saturday, February 03, 2007
Floods in Jakarta
I was in Jakarta during the past three days.
The flood was bad. It caused traffic congestion as the vehicles had to move slowly through the flooded roads. Some broke down, causing further bottlenecks.
Many homes did not have electricity.
About one third of the employees could not get to work, due to lack of electricity or public transport.
It took me 2 1/2 hours to travel from the city center to the airport. In normal days, it should have taken less than 1 hour. I nearly missed my flight.
The flood was bad. It caused traffic congestion as the vehicles had to move slowly through the flooded roads. Some broke down, causing further bottlenecks.
Many homes did not have electricity.
About one third of the employees could not get to work, due to lack of electricity or public transport.
It took me 2 1/2 hours to travel from the city center to the airport. In normal days, it should have taken less than 1 hour. I nearly missed my flight.
Thursday, February 01, 2007
How does NTUC Income earn 4% better than similar funds?
Dear Mr Tan,
I read your posting on your Global Equity fund. During the 3 years, the annual return is 4% higher than the average for the other funds. The difference in the expense rate is only 0.3%. Where does the other 3.7% come from? Are your fund managers better than the others?
JK
---------------
Dear JK
Frankly, I do not know the answer. I think that the quality of the fund managers should be similar. Most funds will probably engage quite good investment managers.
I suspect that some of the other funds have high charges that are not disclosed in the expense rate. Maybe there are leakages that affect the return on the fund.
For example, if some investors are allowed to make additional investors at a favourable price, it will be at the expense of the other investors and will reduce the overall return on the fund.
I read your posting on your Global Equity fund. During the 3 years, the annual return is 4% higher than the average for the other funds. The difference in the expense rate is only 0.3%. Where does the other 3.7% come from? Are your fund managers better than the others?
JK
---------------
Dear JK
Frankly, I do not know the answer. I think that the quality of the fund managers should be similar. Most funds will probably engage quite good investment managers.
I suspect that some of the other funds have high charges that are not disclosed in the expense rate. Maybe there are leakages that affect the return on the fund.
For example, if some investors are allowed to make additional investors at a favourable price, it will be at the expense of the other investors and will reduce the overall return on the fund.
Leaving NTUC Income
Hi Mr Tan,
I got to know from the Jan 2007 eFocus that you're leaving NTUC Income.
Your name is almost synonymous with NTUC Income.
I have full confidence in your company, under your leadership all these years, and I trust that you have your policy holders' interest at heart. NTUC Income, with it's "no-frill" image, has provided very comprehensive insurance coverage for all aspects of my insurance needs at very competitive and affordable premiums.
You came across as a very sincere person, me and my family think you'll make a very good MP....really.
It's a regret that you're leaving NTUC Income, nonetheless I wish you the very best in the next leap of your career!
SK
I got to know from the Jan 2007 eFocus that you're leaving NTUC Income.
Your name is almost synonymous with NTUC Income.
I have full confidence in your company, under your leadership all these years, and I trust that you have your policy holders' interest at heart. NTUC Income, with it's "no-frill" image, has provided very comprehensive insurance coverage for all aspects of my insurance needs at very competitive and affordable premiums.
You came across as a very sincere person, me and my family think you'll make a very good MP....really.
It's a regret that you're leaving NTUC Income, nonetheless I wish you the very best in the next leap of your career!
SK
Subscribe to:
Posts (Atom)