Hi Mr. Tan
I read your blog everyday and enjoy your good advice.
When you are the CEO of INCOME, I had full confidence in you and invested 90% of my saving/investment in INCOME until to-day. I made a lot of money through INCOME shares, endowment policy, combined fund).
My insurance policy will mature soon. I like to invest in the Minibond Series to earn interest from 5.1% to 6.4%)
Is this a low or high risk investment? What is the disadvantage to investor? I do not want to put the more money in the INCOME money market fund because I already had more than $300,000 invested with INCOME.
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REPLY:
I am not familiar with this Minibond series. Can you send some details to me?
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Dear Mr Tan,
Thank you for your reply.
Since you are not familiar with this Minibond, I will not invest it. I do not want to take away to much of your time to look into this.
Anyway, I want to say thanks to you again. Because of your good & frank advice, I have make money from my saving/investment through NTUC INCOME during your time as a CEO.)
Saturday, May 19, 2007
Yields on money market fund
Dear Mr Tan,
From its website, fundsupermarket now pays 2.26% p.a. on its cash fund. I am not familiar with the money market fund from OCBC Lion.
What does NTUC offer for its flexi-cash?
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REPLY:
When I studied the NTUC money market fund a month ago, the yield was about 3% p.a.
I suggest that you call the business center and ask them about the yield on their money market fund.
From its website, fundsupermarket now pays 2.26% p.a. on its cash fund. I am not familiar with the money market fund from OCBC Lion.
What does NTUC offer for its flexi-cash?
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REPLY:
When I studied the NTUC money market fund a month ago, the yield was about 3% p.a.
I suggest that you call the business center and ask them about the yield on their money market fund.
Difference between personal and group plan
Dear Mr Tan
I enjoy reading your blog daily, especially topics on money markets and term insurance.
I recently bought the NTUC Income family insurance plan with living benefit rider for protection against 30 critical illnesses. I am paying a premium of about $24 per month for the term insurance. The plan will cover me till 64 years old with possibilty of further renewal.
NTUC Income came up with a new living plan for union members. The deluxe plan covers 30 critical illness as well but it seems to be cheaper.
Which product will you recommend?
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REPLY:
The coverage under a group insurance plan is subject to change on each yearly renewal. The premium may increase or the coverage may be withdrawn. Sometimes, the premium depends on the age in each year, and may be increased when you get older.
Generally, it is better to have a personal plan that provides guaranteed coverage.
My advice: Buy a basic amount of coverage under a personal plan (in spite of the slightly higher premium) and to take the additional coverage under a group plan.
I enjoy reading your blog daily, especially topics on money markets and term insurance.
I recently bought the NTUC Income family insurance plan with living benefit rider for protection against 30 critical illnesses. I am paying a premium of about $24 per month for the term insurance. The plan will cover me till 64 years old with possibilty of further renewal.
NTUC Income came up with a new living plan for union members. The deluxe plan covers 30 critical illness as well but it seems to be cheaper.
Which product will you recommend?
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REPLY:
The coverage under a group insurance plan is subject to change on each yearly renewal. The premium may increase or the coverage may be withdrawn. Sometimes, the premium depends on the age in each year, and may be increased when you get older.
Generally, it is better to have a personal plan that provides guaranteed coverage.
My advice: Buy a basic amount of coverage under a personal plan (in spite of the slightly higher premium) and to take the additional coverage under a group plan.
Yield on life insurance policies
Dear Mr. Tan,
Your wrote in your blog that whole life policy gives terribly low return of 1%. My family has 2 living policies with NTUC and 2 with Great Eastern. What is the return for living policies? In your opinion what type of insurance policy commands the highest returns?
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REPLY:
The yield on a living policy is lower than a whole life policy, as it provides a much wider cover.
Generally, the yield from NTUC Income is quite satisfactory. You can read about the return in my FAQs.
For a person who has already committed to a life insurance policy and incurred the sales charge, it is usually better to keep the policy.
The yield over the next 10 years, in the case of NTUC Income, is about 3% to 4% p.a. The return from other insurance companies is usually lower, due to their higher charges.
Your wrote in your blog that whole life policy gives terribly low return of 1%. My family has 2 living policies with NTUC and 2 with Great Eastern. What is the return for living policies? In your opinion what type of insurance policy commands the highest returns?
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REPLY:
The yield on a living policy is lower than a whole life policy, as it provides a much wider cover.
Generally, the yield from NTUC Income is quite satisfactory. You can read about the return in my FAQs.
For a person who has already committed to a life insurance policy and incurred the sales charge, it is usually better to keep the policy.
The yield over the next 10 years, in the case of NTUC Income, is about 3% to 4% p.a. The return from other insurance companies is usually lower, due to their higher charges.
Contribute to my blog
I wish to invite my readers to contribute to my blog. If you have any views on the topics covered in my blog, send them to me at kinlian@gmail.com. I will edit them (if necessary) and post them in my blog. You can ask to be named or anonymous.
Let us work together to create a more interesting blog with contributions from several people.
Let us work together to create a more interesting blog with contributions from several people.
A versatile two letter word
There is a two-letter word that perhaps has more meanings than any other two-letter word, and that word is "UP."
It's easy to understand UP, meaning toward the sky or at the top of the list, but when we awaken in the morning, why do we wake UP?
At a meeting, why does a topic come UP? Why do we speak UP , and why are the officers UP for election and why is it UP to the secretary to write UP a report?
We call UP our friends. And we use it to brighten UP a room, polish UP the silver, we warm UP the leftovers and clean UP the kitchen. We lock UP the house and some guys fix UP the old car.
At other times the little word has real special meaning. People stir UP trouble, line UP for tickets, work UP an appetite, and think UP excuses.
To be dressed is one thing but to be dressed UP is special. And this UP is confusing:
A drain must be opened UP because it is stopped UP.
We open UP a store in the morning but we close it UP at night. We seem to be pretty mixed UP about UP !
To be knowledgeable about the proper uses of UP, look the word UP in the dictionary. In a desk-sized dictionary, it takes UP almost 1/4 of the page and can add UP to about thirty definitions.
If you are UP to it, you might try building UP a list of the many ways UP is used. It will take UP a lot of your time, but if you don't give UP, you may wind UP with a hundred or more.
When it threatens to rain, we say it is clouding UP. When the sun comes out we say it is clearing UP.
When it rains, it wets UP the earth.
When it doesn't rain for awhile, things dry UP.
One could go on and on, but I'll wrap it UP , for now my time is UP,
So............. Time to shut UP ....!
It's easy to understand UP, meaning toward the sky or at the top of the list, but when we awaken in the morning, why do we wake UP?
At a meeting, why does a topic come UP? Why do we speak UP , and why are the officers UP for election and why is it UP to the secretary to write UP a report?
We call UP our friends. And we use it to brighten UP a room, polish UP the silver, we warm UP the leftovers and clean UP the kitchen. We lock UP the house and some guys fix UP the old car.
At other times the little word has real special meaning. People stir UP trouble, line UP for tickets, work UP an appetite, and think UP excuses.
To be dressed is one thing but to be dressed UP is special. And this UP is confusing:
A drain must be opened UP because it is stopped UP.
We open UP a store in the morning but we close it UP at night. We seem to be pretty mixed UP about UP !
To be knowledgeable about the proper uses of UP, look the word UP in the dictionary. In a desk-sized dictionary, it takes UP almost 1/4 of the page and can add UP to about thirty definitions.
If you are UP to it, you might try building UP a list of the many ways UP is used. It will take UP a lot of your time, but if you don't give UP, you may wind UP with a hundred or more.
When it threatens to rain, we say it is clouding UP. When the sun comes out we say it is clearing UP.
When it rains, it wets UP the earth.
When it doesn't rain for awhile, things dry UP.
One could go on and on, but I'll wrap it UP , for now my time is UP,
So............. Time to shut UP ....!
Avoid triple insurance
Dear Mr Tan,
I have bought the incomeshield Plan P for my children and Plan A for me and my spouse. We are also covered under the Hospital and Surgical Plan with NTUC.
Is it neccessary for us to insure under H&S if we are covered under the incomeshield? Moreover, I and my wife have company hospital insurance coverage.
IF it's not neccessary to cover under the H&S I would rather use the money to invest.
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REPLY:
At present, you have triple insurance (ie company plan, Incomeshield, H&S insurance). This is not necessary. You can discontinue your H&S plan.
If you do not have the company plan, you have the following options:
* take an Incomeshield rider to cover the deductible and co-insurance (which is not covered under the Incomeshield plan)
* pay the deductible and co-insurance out of your Medisave account (ie you do not need to insure these items).
Some advisers sell the H&S plan to cover the deductible and co-insurance, before the rider was available. The rider is a better plan to cover these items, as it avoids the duplication (and higher cost) of the H&S plan.
My personal preference is to take Incomeshield only to cover the big bills, and to pay the deductible and co-insurance out of Medisave savings.
I have bought the incomeshield Plan P for my children and Plan A for me and my spouse. We are also covered under the Hospital and Surgical Plan with NTUC.
Is it neccessary for us to insure under H&S if we are covered under the incomeshield? Moreover, I and my wife have company hospital insurance coverage.
IF it's not neccessary to cover under the H&S I would rather use the money to invest.
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REPLY:
At present, you have triple insurance (ie company plan, Incomeshield, H&S insurance). This is not necessary. You can discontinue your H&S plan.
If you do not have the company plan, you have the following options:
* take an Incomeshield rider to cover the deductible and co-insurance (which is not covered under the Incomeshield plan)
* pay the deductible and co-insurance out of your Medisave account (ie you do not need to insure these items).
Some advisers sell the H&S plan to cover the deductible and co-insurance, before the rider was available. The rider is a better plan to cover these items, as it avoids the duplication (and higher cost) of the H&S plan.
My personal preference is to take Incomeshield only to cover the big bills, and to pay the deductible and co-insurance out of Medisave savings.
Selecting a good whole life plan
Mr Tan,
Are you saying that a whole life policy gives a poor return? Why are so many whole life policies sold even today? Even NTUC sells them in large numbers.
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REPLY:
If you are investing in a financial product for many years, it is important to have a product that have low charges. The difference in yield of 1% or 2% p.a. can be a lot of money (may 50% more) over 30 years.
Many whole life plans have high charges (to pay commission to the sales agent and profit to the insurance company). They take away an additional 1% or 2% from your yield. It also have a high front end charge, of up to 18 months of your premium. You are locked into this plan and can only cancel the plan after paying a heavy penalty. This is bad.
NTUC Income has lower charges, and can give a yield of about 1% p.a. better than similar plans in the market. It is fairly attractive.
A better plan is to buy a decreasing term insurance and to invest the difference in a low cost, large well diversified fund. Look for an investment plan that has a low sales charge. Better still, look for a plan that has no sales charge.
Are you saying that a whole life policy gives a poor return? Why are so many whole life policies sold even today? Even NTUC sells them in large numbers.
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REPLY:
If you are investing in a financial product for many years, it is important to have a product that have low charges. The difference in yield of 1% or 2% p.a. can be a lot of money (may 50% more) over 30 years.
Many whole life plans have high charges (to pay commission to the sales agent and profit to the insurance company). They take away an additional 1% or 2% from your yield. It also have a high front end charge, of up to 18 months of your premium. You are locked into this plan and can only cancel the plan after paying a heavy penalty. This is bad.
NTUC Income has lower charges, and can give a yield of about 1% p.a. better than similar plans in the market. It is fairly attractive.
A better plan is to buy a decreasing term insurance and to invest the difference in a low cost, large well diversified fund. Look for an investment plan that has a low sales charge. Better still, look for a plan that has no sales charge.
Modest cost of land in America
10 years ago, the market value of land located within 30 minutes of downtown Columbus (Ohio) was about USD 20,000 per acre. Today, it is probably worth about US$40,000 per acre, or USD 1 per square foot. Land in Singapore cost about 200 times of this price.
If you buy a property in Singapore, the cost of the land probably takes up about 70% of the total cost. In America, you get a large piece of land, and it probably takes up only 30% of the total cost of the property.
If you buy a property in Singapore, the cost of the land probably takes up about 70% of the total cost. In America, you get a large piece of land, and it probably takes up only 30% of the total cost of the property.
High monthly subscription to golf clubs
The annual subscription to a golf club in America varies from USD 4,000 to 6,000, depending on the faciliteis of the club. They are about 5 to 10 times of the fees payable in Singapore.
The entrance fee is comparable to Singapore. It is expensive to be a member of a golf club in USA.
The entrance fee is comparable to Singapore. It is expensive to be a member of a golf club in USA.
Discount for seniors in USA
Many businesses in USA gave discount for seniors. They include food outlets and entertainment places. This is an initiative taken by the business outlets to reach out to an important and affluent market of seniors. I hope that businesses in Singapore will also reach out to this market by offering a modest discount.
My stay in Deseret
My wife and I stayed with our friends, Dimon and Darlene McFerson, in their country house in Powell, Ohio. It is about30 minutes from downtown Columbus.
They own a 40 acre property which they named as Deseret (which meant Honeycomb in Hebrew). They built six houses in this property occupied by their 5 children and 30 grandchildren. They also have a club house and large barn (with an indoor basket ball court.
The club house is to be used by their grandchildren for swimming and to bring their friends, so that they do not need to use their grandparent's home for these activities!
The landscape in the property is magnificent. I enjoyed looking out of the window to see the trees and the lawn, and watching the birds and wild deer. I also enjoyed walking outdoors to feel the cool weather.
Friday, May 18, 2007
Bushes and Clintons
Someone observed that during the last 20 over years, America was governed by two families, the Bushes and the Clintons. If Hillary Clinton were to win the next Presidential election, it will extend this unique pattern.
There was a joke that the period of Bill Clinton was called "sex between the bushes". How creative and humorous!
There was a joke that the period of Bill Clinton was called "sex between the bushes". How creative and humorous!
A country house
I asked my friend if his home in Deseret can be considered to be in the suburbs of Columbus.
He said that a suburb is a place where they have many houses close together. If it is a house built in the countryside with a large land area, it is considered as a country house.
It is nice to live in a country house to be near the trees and the water, and yet within 30 minutes from downtown Columbus.
He said that a suburb is a place where they have many houses close together. If it is a house built in the countryside with a large land area, it is considered as a country house.
It is nice to live in a country house to be near the trees and the water, and yet within 30 minutes from downtown Columbus.
The tulip bubble
I took a picture of these tulips at the Tulip Festival in Ottawa Canada.
They remind me about the tulip bubble which occurred 100 years ago. Speculators bidded up the price of a tulip until it cost more than a house. The bubble burst and many people were financially destroyed.
The last bubble that burst in 2001 was the dotcom bubble. After it burst, the benchmark dropped by 75 percent. Many stocks lost 90 percent or more of their value.
The stockmarket is now at a high. Will it be another bubble? We do not know. The former chairman of the Fed said that one can recognise a bubble only after it burst. If it has not burst, it is not a bubble.
I hope that the current boom is not a bubble.
Wednesday, May 16, 2007
Higher interest on Money Market Fund
The money market funds in the USA earn a higher interest rate than time deposits in a bank.
Why?
The bank keep the difference. They justify it by saying that they provide a guarantee, which is backed by the Federal Deposit Insurance Scheme.
As the money market funds are invested in quite secure investments, many people are willing to forgo this guarantee and earn an higher interest rate from the money market funds.
A similar situation applies in Singapore. I expect more people to invest in money market funds in the future.
Why?
The bank keep the difference. They justify it by saying that they provide a guarantee, which is backed by the Federal Deposit Insurance Scheme.
As the money market funds are invested in quite secure investments, many people are willing to forgo this guarantee and earn an higher interest rate from the money market funds.
A similar situation applies in Singapore. I expect more people to invest in money market funds in the future.
Anticipation policy
COMMENT IN MY BLOG (on Whole Life policy with cash payment every 5 years):
If such policies are bad for the consumers, why does NTUC Income, which claims to work in the interest of their policy holders, continue to offer the Anticipation Policy which has a cash payout every 3 years? Looks like a case of saying one thing but doing another.
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REPLY
The Anticipation policy was offered by NTUC Income about 25 years ago, when I was the general manager.
At that time, it offered an attractive yield of 4% or better. The reasons were:
* the sales charge of NTUC Income were much lower than the market
* the investments earned a good rate of return (during a period when interest rate was higher)
* the flexible investment-linked plan was not available
* the return was better than bank deposits
I will not recommend the sale of the Anticipation policy today, for the reasons that I have posted about the whole life policy with cash payment every 5 years.
If such policies are bad for the consumers, why does NTUC Income, which claims to work in the interest of their policy holders, continue to offer the Anticipation Policy which has a cash payout every 3 years? Looks like a case of saying one thing but doing another.
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REPLY
The Anticipation policy was offered by NTUC Income about 25 years ago, when I was the general manager.
At that time, it offered an attractive yield of 4% or better. The reasons were:
* the sales charge of NTUC Income were much lower than the market
* the investments earned a good rate of return (during a period when interest rate was higher)
* the flexible investment-linked plan was not available
* the return was better than bank deposits
I will not recommend the sale of the Anticipation policy today, for the reasons that I have posted about the whole life policy with cash payment every 5 years.
Start Maths at five months
First posted on 15 April 2007
My granddaughter, Vera, is now five months old. She is starting to learn Mathematics. Maybe she will be smarter than her grandpa one day. Ha. Ha.
My granddaughter, Vera, is now five months old. She is starting to learn Mathematics. Maybe she will be smarter than her grandpa one day. Ha. Ha.
Creative message
My daughter Su Ling moved house recently. She created this message to tell her friends about her new address. The baby is my granddaugher, Vera.
Tuesday, May 15, 2007
Subway system in Philadelphia
I went into a subway station at 8 pm, in the downtown area. It was quite deserted. There were no commutters waiting for the train. The station was small, and could take less than 100 commuters, if it was full.
Perhaps most people drive in Philadephia or take the bus.
Perhaps most people drive in Philadephia or take the bus.
Poor return on a whole life policy
Hi Mr Tan,
You posted a story about a whole life policy that gives a return of 1% p.a. over the next 10 years. Why is the return so low? How does the cash payment every 5 years caused the return to be lower?
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REPLY:
Normally, a basic whole life policy should give a return of about 2% p.a. (after paying for the cost of life insurance and the sales charges). If you add a cash payment every 5 years, it reduces the return by about 1% p.a. Here is the reason.
To fund the cash payment, you have to pay an additional premium. The yield on this additional payment should be about 3% p.a. However, after deducting the high commission paid to the agent, you will get a negative return on this additional premium. This reduces the return on the basic whole life policy.
The agent likes to sell this product to you. He or she can earn the high commission on this additional premium as well. But, it is not in the interest of the consumer.
I hope that insurance agents or advisers can act ethically and offer products that give good value to their clients.
You posted a story about a whole life policy that gives a return of 1% p.a. over the next 10 years. Why is the return so low? How does the cash payment every 5 years caused the return to be lower?
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REPLY:
Normally, a basic whole life policy should give a return of about 2% p.a. (after paying for the cost of life insurance and the sales charges). If you add a cash payment every 5 years, it reduces the return by about 1% p.a. Here is the reason.
To fund the cash payment, you have to pay an additional premium. The yield on this additional payment should be about 3% p.a. However, after deducting the high commission paid to the agent, you will get a negative return on this additional premium. This reduces the return on the basic whole life policy.
The agent likes to sell this product to you. He or she can earn the high commission on this additional premium as well. But, it is not in the interest of the consumer.
I hope that insurance agents or advisers can act ethically and offer products that give good value to their clients.
Next "Core Fund" of Vanguard
Vanguard carried out a research on the most preferred fund selected by new investors.
Can you guess their findings? It is so simple!
It is a money market fund that gives a yield that is slightly higher than the interest on savings accounts. There is no front end load (ie sales charge) on the money market fund. The investor is allowed to write cheques against this account.
These investors are willing to move their money to the other bond or stock funds at a later date.
Wow! This is a simple and effective way of marketing.
Can you guess their findings? It is so simple!
It is a money market fund that gives a yield that is slightly higher than the interest on savings accounts. There is no front end load (ie sales charge) on the money market fund. The investor is allowed to write cheques against this account.
These investors are willing to move their money to the other bond or stock funds at a later date.
Wow! This is a simple and effective way of marketing.
A restricted blog for a traveller
I have an idea.
If you are travelling overseas for a short term assignment, you can create a blog and restrict its access to a few identified family members and friends.
You can update your blog at regular intervals. This is to tell them that things are all right.
You can store your contact information, eg address, telephone numbers, so that the family members can get in touch with you in an emergency.
You can also share your experience, eg photos, places of visit, etc.
If you are travelling overseas for a short term assignment, you can create a blog and restrict its access to a few identified family members and friends.
You can update your blog at regular intervals. This is to tell them that things are all right.
You can store your contact information, eg address, telephone numbers, so that the family members can get in touch with you in an emergency.
You can also share your experience, eg photos, places of visit, etc.
Restricted Blog for networking
I have created a new blog that is restricted only to a few specified people who share a common interest. I am experimenting with this new form of communication. I find blogspot tobe easy to use, and is better than other platforms, such as an website forum.
How to select the Vanguard ETFs
I showed a list of 31 Vanguard ETFs (exchange traded funds) to an expert and asked, "Which funds do you recommend?" Here is his reply.
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Hi --
The textbook answer on how to invest is to invest according to your risk preference. But no one really knows their risk preference -- so you can follow a rule of thumb, like to make the per cent of non-risky assets in your portfolio equal to your age.
Then a person at age 60 could put, say, 20 per cent into a stock fund, like the All-World ex-US index and 20 per cent in the Total Stock Market index (which is US stocks) -- and 60 per cent in the short-term bond fund.
On the other hand, if you don't want to take the robot approach and you want to have some fun with it, you can pick and choose what to buy -- (and do market timing).
If I were to market time (even though we know it can't be done), I would probably put 100 per cent in a bond fund and wait for the market to come down.
Suppose I am wrong and the market keeps marching higher at its normal pace of about 12 per cent per year (including dividends).
Then the short-term bond fund has returned about 5 per cent per year over the past 10 years, the intermediate bond fund about 6.5 per cent per year and the long-term bond fund about 8 per cent per year -- (as reflected in the average yield curve during that period).
So, even in the short-term bond fund, you would miss out on only 7 per cent return (12 - 5). If the market corrects, however, the loss in stocks would probably be more.
So, that is my advice.
Penn's Landing
Near my hotel in Pennsylvania is a well known landmark called "Penn's Landing". My friend told me that it is the place that William Penn from England first landed in America. The state Pennsylvania is named after William Penn.
Visit to Vanguard Mutual Fund Group
I visited Vanguard at Valley Forge today.
I met with eight senior executives in charge of various aspects of their operations: retail, institutional, call center, fund accounting, marketing, international, data center and the legendary Jack Bogle.
I had a photograph taken with Mr Bogle. I shall post it into the blog in a few days time.
I learned many useful aspects of the Vanguard way of doing business. They are useful for my IC21 project (Insurance Company for the 21st Century).
I met with eight senior executives in charge of various aspects of their operations: retail, institutional, call center, fund accounting, marketing, international, data center and the legendary Jack Bogle.
I had a photograph taken with Mr Bogle. I shall post it into the blog in a few days time.
I learned many useful aspects of the Vanguard way of doing business. They are useful for my IC21 project (Insurance Company for the 21st Century).
Raising a baby
My daughter, Su Ling, shares her experience in raising her daughter, Vera, in this blog. This may be of interest to mothers of baby during the first year.
Monday, May 14, 2007
Whole life a cash payment every 5 years
Here is a whole life policy with a cash payment every 5 years:
* sum assured $25,000
* cash value in 2007: $4,300
* cash payment of $3,750 in 2007 and 2012
* cash value in 10 years time: $8,250
* annual premium: $1,158
I computed the yield on this policy for the next 10 years to be 1% p.a. It is a poor yield. (In my calculation, I assume that the cash payment can be reinvested to earn 2% p.a.)
If he had bought a straight forward whole life plan, without the cash payment, the yield would have been better (ie maybe closer to 2% p.a.). The cash payment reduced the yield.
Tip: Do not invest in a plan with a cash payment every few years. You get a poor return.
* sum assured $25,000
* cash value in 2007: $4,300
* cash payment of $3,750 in 2007 and 2012
* cash value in 10 years time: $8,250
* annual premium: $1,158
I computed the yield on this policy for the next 10 years to be 1% p.a. It is a poor yield. (In my calculation, I assume that the cash payment can be reinvested to earn 2% p.a.)
If he had bought a straight forward whole life plan, without the cash payment, the yield would have been better (ie maybe closer to 2% p.a.). The cash payment reduced the yield.
Tip: Do not invest in a plan with a cash payment every few years. You get a poor return.
Advice on real life issues
I post in my blog, the real life issues faced by my readers. I edit their question and post my reply.
I remove specific details that can identify the writer to people that they are associated with. This is to preserve anonymity.
Usually, other readers face similar issues. I hope that my posting will be beneficial to them as well.
It hope that my blog will be more interesting with these real life issues.
I remove specific details that can identify the writer to people that they are associated with. This is to preserve anonymity.
Usually, other readers face similar issues. I hope that my posting will be beneficial to them as well.
It hope that my blog will be more interesting with these real life issues.
The coming of the entrepreneurial society
Here is a some key points from a chapter in The Essential Drucker by Peter Drucker.
Institutions, systems, policies eventually outlive themselves. They do it when they accomplish their objectives and they do it when they fail to accomplish their objectives. The mechanisms may still tick. But the assumptions on which they were designed have become invalid.
Theories, values and all the artifacts of human minds and human hands do age and rigidify, becoming obsolete, becoming afflictions.
Innovation and entrepreneurship are needed in society, in the economy, in public service institutions, and in businesses.
They are not planned but focused on this opportunity or that need. They are tentative and will disapper if they do not produce the expected and needed results. They are pragmatic rather than dogmatic, modest rather than grandoise.
They promise to keep any society, economy, industry, public service or business flexible and self-renewing.
Planning is incompatible with an entrepreneurial society and economy. Innovation has to be decentralised, ad hoc, autonomous, specific and microeconomic. It has to start small, tentative, flexible.
The opportunity for innovation has to be found way down and close to events.
Conclusion: Innovation is needed to keep a society relevant. Planning is incompatible with an entrepreneurial society.
Institutions, systems, policies eventually outlive themselves. They do it when they accomplish their objectives and they do it when they fail to accomplish their objectives. The mechanisms may still tick. But the assumptions on which they were designed have become invalid.
Theories, values and all the artifacts of human minds and human hands do age and rigidify, becoming obsolete, becoming afflictions.
Innovation and entrepreneurship are needed in society, in the economy, in public service institutions, and in businesses.
They are not planned but focused on this opportunity or that need. They are tentative and will disapper if they do not produce the expected and needed results. They are pragmatic rather than dogmatic, modest rather than grandoise.
They promise to keep any society, economy, industry, public service or business flexible and self-renewing.
Planning is incompatible with an entrepreneurial society and economy. Innovation has to be decentralised, ad hoc, autonomous, specific and microeconomic. It has to start small, tentative, flexible.
The opportunity for innovation has to be found way down and close to events.
Conclusion: Innovation is needed to keep a society relevant. Planning is incompatible with an entrepreneurial society.
Congestion on the Central Expressway
I moved into Yio Chu Kang in 1998 (nearly 10 years ago). I noticed, at that time, that it was getting congested.
I wrote to the authority to suggest the building of a second layer, above the Central Expressway. This would be similar to the second layer above Keppel Road.
Many cities adopted this approach.
The authority worked on another approach: to develop the Kallang Paya-Lebar Expressway. After 10 years, it is now almost ready.
If I were given the power to decide, my choice would be a second layer above the Central Expressway. Why? It could probably be implemented in half the time.
I hope that the new Kallang, Paya Lebar Expresway will finally ease the congestion on the Central Expressway.
I wrote to the authority to suggest the building of a second layer, above the Central Expressway. This would be similar to the second layer above Keppel Road.
Many cities adopted this approach.
The authority worked on another approach: to develop the Kallang Paya-Lebar Expressway. After 10 years, it is now almost ready.
If I were given the power to decide, my choice would be a second layer above the Central Expressway. Why? It could probably be implemented in half the time.
I hope that the new Kallang, Paya Lebar Expresway will finally ease the congestion on the Central Expressway.
Promotional rates for bank deposits
Many banks offer an attractive rate to draw new funds, but renew the deposits at their normal board rates (which are lower than the promotional rate).
Is this a fair deal?
If the bank is transparent about the arrangement, then it is all right. But if they do it quietly, then it is unfair to the depositor.
There are three ways for the bank to handle the renewal:
1. renew it automatically (without telling the depositor)
2. send a letter to inform the depositor
3. telephone the depositor
The fairest way is to telephone the deposit (method #3) and tell them the fact - i.e that the deposit is being renewed at the board rate. The bank is reluctant to do it, as the depositor will renew the deposit at a higher promotional rate that is available in the market
Some banks send a letter (method #2) to the depositor. Many depositors do not open their mail on time, and miss the deadline. The deposit is automatically renewed at the lower board rate.
Here is my suggestion to the depositor. If you put your deposit at a promotional rate, put an entry into your diary or organiser. It will remind you to call the bank before the expiry date to check what is on offer. You can also search for the best offer available from other banks.
Just get organised.
Quote from Tan Kin Lian: If you do not take care of your financial matters, your bank will take care of it for you, but in their favour.
Is this a fair deal?
If the bank is transparent about the arrangement, then it is all right. But if they do it quietly, then it is unfair to the depositor.
There are three ways for the bank to handle the renewal:
1. renew it automatically (without telling the depositor)
2. send a letter to inform the depositor
3. telephone the depositor
The fairest way is to telephone the deposit (method #3) and tell them the fact - i.e that the deposit is being renewed at the board rate. The bank is reluctant to do it, as the depositor will renew the deposit at a higher promotional rate that is available in the market
Some banks send a letter (method #2) to the depositor. Many depositors do not open their mail on time, and miss the deadline. The deposit is automatically renewed at the lower board rate.
Here is my suggestion to the depositor. If you put your deposit at a promotional rate, put an entry into your diary or organiser. It will remind you to call the bank before the expiry date to check what is on offer. You can also search for the best offer available from other banks.
Just get organised.
Quote from Tan Kin Lian: If you do not take care of your financial matters, your bank will take care of it for you, but in their favour.
Use Skype and SkypeOut
I am use Skype for computer-to-computer chat.
I arrange a time for this chat with my friend. I log into Skype and see if my friend is "online". I dial my friend using Skype. It can take the call on the computer. We have a voice conversation.
This process was quite easy and convenient. It is free. The voice quality is very good.
For those who have not tried, it is quite easy. Get a friend to try it with you in Singapore. You can use it later, when you are overseas.
There is another way to call someone using SkypeOut. You can use Skype to dial someone on a telephone. They take the call in the usual way.
The international connection is free (using Skype). There is a small charge for the local connection. In Singapore, the charge is about 5 cents a minute.
I arrange a time for this chat with my friend. I log into Skype and see if my friend is "online". I dial my friend using Skype. It can take the call on the computer. We have a voice conversation.
This process was quite easy and convenient. It is free. The voice quality is very good.
For those who have not tried, it is quite easy. Get a friend to try it with you in Singapore. You can use it later, when you are overseas.
There is another way to call someone using SkypeOut. You can use Skype to dial someone on a telephone. They take the call in the usual way.
The international connection is free (using Skype). There is a small charge for the local connection. In Singapore, the charge is about 5 cents a minute.
Blog - keep in touch
My daughter read from my blog that I am in Philadelphia. She sent an e-mail to recommend me to try the cheese steaks at Pat's King of Stakes. She also sent the URL link to this address. It is not far from my hotel.
She also read that her mother had food poisoning. She asked if she is all right now.
She also read that her mother had food poisoning. She asked if she is all right now.
Transport Operators make good profits
I read several stockbroker reports that our transport operators make good profits during the past year.
This is good news for their shareholders.
I hope that the transport operators will use some of the profits to improve service for commuters.
* operate more buses and trains on the routes
* reduce waiting time
* give more comfort to commuters, ie less crowding
* improve the taxi service
This is good news for their shareholders.
I hope that the transport operators will use some of the profits to improve service for commuters.
* operate more buses and trains on the routes
* reduce waiting time
* give more comfort to commuters, ie less crowding
* improve the taxi service
Historic district in Philadelphia
I am staying at the Sheraton Society Hill in Philadelphia. It is located in the historic, waterfront district, next to the Delaware River. The grand Benjamin Franklin Bridge cross the Delaware River nearby.
I walked around the hotel this evening. I came across many places of interest and monuments, bringing the visitor back to the days of the American Independence movement, some 250 years ago.
Philadephia has an excellent street naming system. Running north to south, the streets are named in numerical order, ie 1st street, 2nd street, etc.
Running east to west, the streets have names of trees and personalities, eg Pine St, Walnut St, Washington Avenue.
To the west, across the Schuylkill River, is the University of Pennysylvania. The famous Wharton Business School is located in this university. They have some collaboration with the Singapore Management University.
I walked around the hotel this evening. I came across many places of interest and monuments, bringing the visitor back to the days of the American Independence movement, some 250 years ago.
Philadephia has an excellent street naming system. Running north to south, the streets are named in numerical order, ie 1st street, 2nd street, etc.
Running east to west, the streets have names of trees and personalities, eg Pine St, Walnut St, Washington Avenue.
To the west, across the Schuylkill River, is the University of Pennysylvania. The famous Wharton Business School is located in this university. They have some collaboration with the Singapore Management University.
Sunday, May 13, 2007
Make an interesting blog
I invite my visitors to send me views for posting into my blog. This will help to make my blog to be more interesting.
I welcome different perspectives. Some may agree with me. Others have different views. The diversity of views will spice up my blog.
Here are some tips about giving your views:
* be positive
* avoid making judgement
* respect the views of other people.
I welcome different perspectives. Some may agree with me. Others have different views. The diversity of views will spice up my blog.
Here are some tips about giving your views:
* be positive
* avoid making judgement
* respect the views of other people.
Mr Tan, your blog is boring
Dear Mr. Tan,
You have been coercing people to read your blog. I am afraid, you need to improve your articles somewhat.
You wrote, "I have a good impression of Ottawa". In what way? You need to elalorate on the salient points to persuade readers to your view point.
Am, afraid you blog is getting too boring to justify your growing readership.
You have been coercing people to read your blog. I am afraid, you need to improve your articles somewhat.
You wrote, "I have a good impression of Ottawa". In what way? You need to elalorate on the salient points to persuade readers to your view point.
Am, afraid you blog is getting too boring to justify your growing readership.
Visiting Vanguard on May 14
I will be visiting Vanguard Mutual Fund Group in Valley Forge, Pennysylvania on Monday 14 May. They are among the top fund managers in the world.
I shall be looking at the following:
* how they market their funds to their customers
* how they educate their customers
* how they service their customers
I will be meeting John (Jack Bogle) who was the founder of Vanguard.
My host for the visit is a Sudoku fan. I shall bring 6 volumes of my Logic9 pocket book to present to him.
I shall be looking at the following:
* how they market their funds to their customers
* how they educate their customers
* how they service their customers
I will be meeting John (Jack Bogle) who was the founder of Vanguard.
My host for the visit is a Sudoku fan. I shall bring 6 volumes of my Logic9 pocket book to present to him.
Try to negotiate a fair settlement
Dear Mr. Tan
I need your personal advice regarding a traffic accident claim for my relative.
He was hit by a motorbike and has been seriously injured for more than half a year. I engaged a lawyer and the case is now being decided by the court. The insurer's lawyer is asking for settlement out of court.
The insurer is offering a partial settlement due to contributory negligence on the part of my relative. Is the proposed settlement fair? What is your advice?
--------------------
REPLY
Let me give you my suggestion:
1. Ask your lawyer to give a report to you, stating his recommendation on the apportionment of liability and on the quantum that is claimable for special and general damages
2. Ask the insurer's lawyer to give the reason to support their offer.
3. Meet with the insurer (in the presence of your lawyer) to negotiate a settlement.
4. If there is a large gap, suggest that the matter be referred to an arbitrator that is appointed by both parties.
5. Try to find a reasonable settment, so as to reduce the legal fees on both sides. A contested cases can be costly (ie legal fees can take away 30% to 50% of the total settlement) and take a long time to settle.
6. Generally, the insurer is willing to come to a fair settlement, to avoid the costly legal fees.
I need your personal advice regarding a traffic accident claim for my relative.
He was hit by a motorbike and has been seriously injured for more than half a year. I engaged a lawyer and the case is now being decided by the court. The insurer's lawyer is asking for settlement out of court.
The insurer is offering a partial settlement due to contributory negligence on the part of my relative. Is the proposed settlement fair? What is your advice?
--------------------
REPLY
Let me give you my suggestion:
1. Ask your lawyer to give a report to you, stating his recommendation on the apportionment of liability and on the quantum that is claimable for special and general damages
2. Ask the insurer's lawyer to give the reason to support their offer.
3. Meet with the insurer (in the presence of your lawyer) to negotiate a settlement.
4. If there is a large gap, suggest that the matter be referred to an arbitrator that is appointed by both parties.
5. Try to find a reasonable settment, so as to reduce the legal fees on both sides. A contested cases can be costly (ie legal fees can take away 30% to 50% of the total settlement) and take a long time to settle.
6. Generally, the insurer is willing to come to a fair settlement, to avoid the costly legal fees.
Invest in a life annuity?
Hi Mr Tan
I have a total of $350,000 in my savings. How much should I invest in a life annuity? What are its advantages, as compared to other types of investments?
I wish to have a good income, without taking risk on my capital
------------------
REPLY
You can read my FAQ on life annuity. I suggest that you invest $200,000 in a life annuity, to earn about $1,000 a month, and keep the balance in an investment fund, or the money market fund.
You can talk to an insurance adviser or visit the business center of NTUC Income.
I have a total of $350,000 in my savings. How much should I invest in a life annuity? What are its advantages, as compared to other types of investments?
I wish to have a good income, without taking risk on my capital
------------------
REPLY
You can read my FAQ on life annuity. I suggest that you invest $200,000 in a life annuity, to earn about $1,000 a month, and keep the balance in an investment fund, or the money market fund.
You can talk to an insurance adviser or visit the business center of NTUC Income.
Interview: My blogging experience
I gave this e-mail interview about my blogging experience. The newspaper just printed one line.
----------------------------------------
I'm doing a story about older people who blog. As you understand, blogging is often taken to be a younger person's phenomenom. But we are trying to show the exceptions.
1. What got you to start blogging?
I created my blog about two years ago, after reading a newspaper article. I found it easy to create and maintain a blog. I created my blog to offer my views on financial matters, investments and insurance. Many people write to me for advice. I also wanted to give my views on social issues, so that more people can learn to live a better life in Singapore.
2. What's your philosophy on blogging?
My philosophy is:
* be helpful
* be positive
* keep things simple
3. How has your blogging experience been so far? What have you learnt?
I enjoyed writing my blog. Many of my regular visitors tell me that they enjoy reading my blog. They find my views to be useful and refreshing. Some told me that they are regular visitors.
I learned that it is better to keep the blog simple and short. Many people find it easier to read.
4. Any surprising insights?
Many people like things to be simple. Often, I am not able to give a complete answer. But, people find my answers to be acceptable. They will take what they can use. They will probably ignore those views that they do not agree with, or do not understand. They are generally quite positive.
5. What are some of the difficulties you faced when you started blogging? Such as the technical aspects. Any anecdotes?
For the first year, I had great difficulty in inserting photographs. I read the instructions and followed them closely. But, it just did not work.
This was surprising, as many people appeared to be able to post their pictures and photographs quite easily. I did ask someone for advice, but somehow the advice did not work. So, I gave up for a few months.
One day, I stumbled on the right way, by accident. It was really quite easy to use. I only need to click on the image button (which I did not use before) and locate the image or picture to be inserted. It was so easy.
When my daughter sent me some photos of my grand-daughter learning mathematics at five months old, I was able to upload them into my blog within a few mintues. It was quite easy.
6. Do you consider yourself technologically savvy?
I am knowledgeable in the use of the internet and common software, but does not qualify to be technically savvy. If I have difficulty, I ask the expert to help me. They know the technical matter much more than me.
7. What do your family think of you blogging? Do any of them blog as well?
My daughter and my son wrote their blogs. They do not maintain it as regularly as me. They their their own following among their friends.
8. What do you think of blogs written by the younger generation?
It is a good idea for people to communicate through various channels. A blog is a good channel. If the young people enjoy writing a blog, it is good for them. They can communicate in their own style with their friends and fans.
Each group of people will have to reach out to their friends in their own ways. I do not wish to make any judgement of other people. As long as they write on matters that are useful to other people, the habit should be encouraged.
----------------------------------------
I'm doing a story about older people who blog. As you understand, blogging is often taken to be a younger person's phenomenom. But we are trying to show the exceptions.
1. What got you to start blogging?
I created my blog about two years ago, after reading a newspaper article. I found it easy to create and maintain a blog. I created my blog to offer my views on financial matters, investments and insurance. Many people write to me for advice. I also wanted to give my views on social issues, so that more people can learn to live a better life in Singapore.
2. What's your philosophy on blogging?
My philosophy is:
* be helpful
* be positive
* keep things simple
3. How has your blogging experience been so far? What have you learnt?
I enjoyed writing my blog. Many of my regular visitors tell me that they enjoy reading my blog. They find my views to be useful and refreshing. Some told me that they are regular visitors.
I learned that it is better to keep the blog simple and short. Many people find it easier to read.
4. Any surprising insights?
Many people like things to be simple. Often, I am not able to give a complete answer. But, people find my answers to be acceptable. They will take what they can use. They will probably ignore those views that they do not agree with, or do not understand. They are generally quite positive.
5. What are some of the difficulties you faced when you started blogging? Such as the technical aspects. Any anecdotes?
For the first year, I had great difficulty in inserting photographs. I read the instructions and followed them closely. But, it just did not work.
This was surprising, as many people appeared to be able to post their pictures and photographs quite easily. I did ask someone for advice, but somehow the advice did not work. So, I gave up for a few months.
One day, I stumbled on the right way, by accident. It was really quite easy to use. I only need to click on the image button (which I did not use before) and locate the image or picture to be inserted. It was so easy.
When my daughter sent me some photos of my grand-daughter learning mathematics at five months old, I was able to upload them into my blog within a few mintues. It was quite easy.
6. Do you consider yourself technologically savvy?
I am knowledgeable in the use of the internet and common software, but does not qualify to be technically savvy. If I have difficulty, I ask the expert to help me. They know the technical matter much more than me.
7. What do your family think of you blogging? Do any of them blog as well?
My daughter and my son wrote their blogs. They do not maintain it as regularly as me. They their their own following among their friends.
8. What do you think of blogs written by the younger generation?
It is a good idea for people to communicate through various channels. A blog is a good channel. If the young people enjoy writing a blog, it is good for them. They can communicate in their own style with their friends and fans.
Each group of people will have to reach out to their friends in their own ways. I do not wish to make any judgement of other people. As long as they write on matters that are useful to other people, the habit should be encouraged.