Saturday, October 20, 2012

Simplify the filing process, ACRA

16 October 2012

Editor, Voices
Today Paper

I thank your paper for publishing my letters concerning providing feedback to 
ACRA and participating in their stakeholder's dialogue.

Five months earlier, I accepted their invitation. During this time, I was available
to attend their meetings, but they did not call for a meeting. It was wrong for 
ACRA to suggest that I was not interested or too busy to attend.

The annual report of ACRA for 2010/11 have a statement that "filing fines and prosecution 
penalties grew marginally by 6% to S$17.4 million (FY2009/10: S$16.4 million)."

I had to pay a fine of $120 for filing my annual returns late, although I acted promptly on
receiving their late reminder.  The revenue of $17.4 million suggested that over
100,000 people had failed in meeting their statutory responsibility. 

I had the personal experience of making online filings of the annual return and
change on share capital. The online process is extremely complicated. What should be
a simple matter in the traditional way of filing a paper-based return took hours to 
complete online.

To submit an online filing, the filer has to learn how to navigate the
complicated website and to understand the workings of the back-end system that they
are interacting with.  The potential of making mistakes is quite high. Quite often, the
    website hung and the filer had to repeat the process from the start.  I had to make several 
attempts to complete a simple filing.

I am sure that ACRA must have spent a lot of money on providing helpline support to people
who face difficulty in making online filing.  How wasteful for them and for the public!

I wanted to give my feedback to ACRA that they need to make a fundamental change
to their current approach. Something is clearly wrong, when so many people had
to pay fines and penalties.

Tan Kin Lian

Wednesday, October 17, 2012

A prudent taxi driver

I asked a taxi driver, who is in his 50s, if he has fully paid up his HDB flat. He shared his personal experience.

He bought a 3 room HDB flat for $29,000. Eight years later, its value increased to $60,000. He sold it and bought a resale 4 room HDB flat for $80,000. He took an additional loan for $20,000 and paid a monthly installment of $150 (or thereabouts) for 15 years. He has fully paid up his 4 room HDB flat, which is more than adequate for his needs. His children have grown up.

I said that he had managed his finances wisely.

He shared the experience of a neighbor who sold the first HDB flat, took out the profit and spent it away. The neighbor took a full loan on the resale HDB flat and now had to pay $1,000 a month up to age 75. This was very stressful.

Another friend sold the HDB flat on two occasions and took out the profit. He invested in the stock market and lost the money entirely. He could not pay the mortgage on the 5 room HDB flat which was repossessed. Now, he had to downgrade to a 3 room HDB flat, and was in a worse condition than the taxi driver.

Another relative could not pay the mortgage installment for more than 10 years. The HDB did not repossess his flat but continue to add interest and lawyer fees. As the value of the 5 room HDB flat was above the money owed, he was allowed to continue living in the flat. When he sells the flat, the net amount, after paying the loan, would not be sufficient to buy a 3 room flat today.

The three cases of over-spending on HDB flats are quite common and has harmed the finances of many Singaporeans.

Whole life "Umbrella" policy

The taxi driver who drove me to the airport told me this story. 30 years ago, he wanted a life insurance policy that pays him at age 55. The NTUC agent sold him the Umbrella policy. When he read the policy documents many years later, he was angry. The Umbrella policy required him to pay premium for 55 years, rather than allow him to collect his money at age 55. He found that the premium was very low, so he did not raise a complaint.

When he reached age 55, he was told that he could surrender his policy for more than $50,000. The increase in the surrender value each year was more than 9%. (I do not know if this figure is correct, but that was what he was told). The sum assured was $100,000 and the accumulated bonus was more than $20,000.

He then realized that it was a good life insurance policy and decided to keep it for as long as he could. He was still earning an income as a taxi driver. It allowed him to give more than $100,000 to his wife, if anything happened to him. He said that the NTUC agent had recommended a good policy to the customer, although this was not explained well at that time.

He recommended his son to buy the Umbrella policy, but found that it was no longer being sold by NTUC Income. To buy a similar coverage today, the premium would be a few times higher. (Again, I am not sure that he is given the correct figure).

I told him that I was running NTUC Income at that time. 

Tuesday, October 16, 2012

Basics of investing

I often receive e-mails from the public asking my views about investing in various types of investments. During the past week, the questions were about investing in silver and pre-IPO shares. They ask - are these investments safe?

My reply is, "attend the educational talks on financial planning and investments, organised by FISCA. Learn about investing in blue chip shares. They form a benchmark for you to compare about investing in other types of investments. The talks also tell you about dubious investments that you should avoid. "

The next talk is on 27 October. Details can be found here: This talk is being held once in three months, so do not miss it. Register now.

Avoid investing in unfamiliar schemes

Dear Mr. Tan 
I was recently introduced to invest in a certain company ( X ). I was told that the company has partnerships with Y and Z. I was also told that the one of its companies will be listed by next year and thus an investment of $10,000 will reap a profit of 87%. 
As this is my first time in investing, I searched for information on X through the Internet. I found only bad reviews about X. Several people on the forums said that X is linked to another company which is believed to be a scam. I don't know what to look out for and how to protect my money. 


Never invest in any scheme that you are not familiar with, as the potential for being a scam is quite high. 

Join FISCA and learn about investing in the proper way.
You can attend the education talks organised by FISCA here
You can join FISCA as a member and enjoy discounts on the talks
To join as a member, register here:
The membership fee is $36 a year, and you can access the website and get a
newsletter twice a month.

Sunday, October 14, 2012

Financial Planning 27 October 2012

There is a FISCA talk on Financial Planning on 27 October. Register now.

Facecard on iPad

Facecard is a name card stored in the Cloud. You can create your Facecard at

You can download the Facecard app on iPhone or iPad. This allows you to download the Facecard of your contacts into your mobile device and to search for any contact. This beats storing the physical name cards at your desk!

You can also send links to your Facecard to your contacts. They can store your link in their Contact Box in the Cloud and download them into their mobile device. When you update your Facecard, they get the latest details automatically.

Try it now.

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