Too lazy to find out for themselves

Hi, Mr. Tan

I was reading your article on the distribution cost of insurance and the reactions most honest and hardworking Sporeans gave you when you shared with them the actual amount of money some policies are taking away from them as distribution costs.

 

It seems to me that Sporeans are too tired or too lazy to find things out for themselves. They prefer to have things done for them. This may explain why they are easy target for scams and are taken for a ride easily. Sometimes I feel that even the government is trying to take Sporeans for a ride.

 

This may be one reason why Spore as you put it aptly "stinks" nowadays. People are finding it hard to eke out a living. As such most of them are too tired to think about the bigger scheme of things after a long and hard day's work. They know they need insurance but they are unable or unwilling to spend time to source for a good insurance policy. This is why investment linked policy are a favourite (since they can have cash back ie savings, get coverage etc etc) kill many birds with a stone, not knowing that the one who get killed is most probably themselves if they end up getting a raw deal.

 

Same thing when it comes to many things our government is doing or managed to get away with doing. People are just too tired to do anything about it as they can barely make a decent living. Perhaps if they cannot keep their stomach filled up and their bodies warm, they will not be bothered about those higher needs in Maslow's hierarchy of needs. And therefore controlling them and manipulating them will be that much easier.

 

I really hope Sporeans who have benefitted previously and are in a position to do make things better will really rise to the occasion and make a stand. Do whatever they can to educate Sporeans and not let the stink continues in Spore.

 

Mr. Foo

Alnernative systems to set the benchmark

In the early eighties, the Government was debating on whether to build the MRT station. The Minister for Communications, Mr. Ong Teng Cheong, was in favor of MRT. Dr. Goh Keng Swee,  Deputy Prime Minister, was in favor an all-bus alternative. The Government commissioned a team of transport experts from America who advised that an all-bus system was feasible. The Cabinet finally decided in favor of the MRT system.

Most Singaporeans would agree that the MRT system was a better approach, as it was able to carry large number of people quickly, and was not affected by road congestion. Our MRT system was considered to be a "world class transport system" for several years.

Many people did not realize the valuable contribution of Dr. Goh in this debate. By arguing in favor of the all-bus system, he presented an alternative proposal, which was more economical and quicker to implement. This alternative presented a benchmark to compare the cost of the MRT system .

For example, if the all-bus alternative was, say $1.5 billion, the MRT system can be more expensive, but cannot be "too far off". This allowed the cost of the MRT system to be kept under proper financial control. I suspect that this was the key reason who the initial system was kept at a modest cost of $2 billion dollars for the North South and the East West lines. (Note: I am recalling some of these figures from memory, and may not be accurate).

By contrast, the Thomson MRT line was estimated to be $18 billion, and the Marina Costal Highway was $4.3 billion. These sums are staggering.

We now know that people like Dr. Goh Keng Swee played an important role to ensure that the government spending was "value for money". We dearly missed people like him; people who are visionary and courageous, and are willing to argue for alternatives!

Dr. Goh left the cabinet in 1985. Since then, we have seen a gradual deterioration in the quality of leadership in our government and civil service.

Advice on Education Policy

Roger Seow asked:
What will be a better way to save for children's education: Endowment or Education? I notice many parents tend to buy Education policy because it is named for education.

REPLY
be careful about the education policy. Some are all right, but some are horrible.
Here is an article of a bad policy that a customer had bought and decided to stop at a loss of $20,000.
http://tankinlian.com/admin/file.aspx?id=800&IID=807

To learn about a better way to invest for your children's education, attend the FISCA talk on financial planning, www.fisca.sg/events.

Why don't you tell me earlier!

I gave a talk on financial planning to employees in a large company. Most of them had served for 10 years.

I told them that the life insurance policy that they had bought is likely to show a distribution cost of $5,000 to $10,000. I explained that it is the money that is taken away from their savings, and is usually two years of their hard earned savings.

THEY WERE SHOCKED. You can see the expression on their faces!

One of them asked, almost crying .... "Why didn't the company arrange this talk earlier, when they start work. It is now too late."

I replied .... "yes, it is too late for you. But can  you tell your younger brothers and sisters to attend my talk now, so that they do not make the same mistake."

I have been actively promoting the talks held by FISCA but too many young people were too busy with their study and work. They do not want to spend the time, or to spend $30. If they make this effort, they can save $5,000 to $10,000 in "distribution cost" and $200,000 over 30 years, i.e the "effect of deduction".

There is a talk on Saturday 25 May 2 to 4 pm held as SMU. This is your chance, not to be missed. The next talk will be held a few months later. (Register at www.fisca.sg/events".

This is also for parents to tell their children, who are teenagers. Act now, and have a proper financial planning for life.

Staggering infrastructure projects

Singaporeans had the impression over the years to think that we have a corruption free government. Recent events should make us re-examine this belief.

Here are some worrisome facts.

a) NParks purchased the Brompton bikes at 5 to 10 times of the cost of suitable alternatives. They are found to be "in compliance" with the standing procedures.

b) Two senior civil servants were charged for corrupt practices in the sex-for-favors trials.

c) We are spending staggering sums for infrastructure projects, e.g. Thomson Line, Marine Coastal Highway, Gardens by the Bay, River in Bishan. We did not get much details of these projects  in the mainstream media lately.

In the past, we can be sure that the Auditor General would keep a close eye on these matters. But, in recent years, I do not seem to hear about issues raised by them. (I could be mistaken).

Do we have people who are capable of auditing these large expenditures to ensure that they are "value for money" and not just "in compiance" with standard procedures. We are talking about staggering sums of money.

Intelligence Quiz Vol 1

Get a free PDF copy of this book at www.tklcloud.com/cud/gift.aspx

This is based on a famous puzzle purported to be created by Albert Einstein. The book contains a solution to the puzzle and 72 new puzzles of the same pattern.

Lessons from a Bank Robbery

This was written by an unknown author in Chinese and translated into English.

There was this robbery in Guangzhou, the robber shouted to everyone: "All don't move, money belongs to the state, life belongs to you". Everyone in the bank laid down quietly.  This is called "Mind Changing Concept --> Changing the conventional way of thinking". 

One lady lay on the table provocatively, the robber shouted at her "Please be civilised! This is a robbery and not a rape!"
This is called "Being Professional --> Focus only on what you are trained to do!"

When the robbers got back, the younger robber (MBA trained) told the older robber (who in only primary school educated), "Big bro, let's count how much we got", the older robber rebutted and said, "You very stupid, so much money, how to count, tonight TV will tell us how much we robbed from the bank!"

This is called "Experience --> nowadays experience is more important than paper qualifications!"

After the robbers left, the bank manager told the bank supervisor to call the police quickly.  The supervisor says "Wait, wait wait, let's put the 5 million RMB we embezzled into the amount the robbers robbed".
This is called "Swim with the tide --> converting an unfavorable situation to your advantage!"

The supervisor says "It will be good if there is a robbery every month".
This is called "Killing Boredom --> Happiness is most important."

 The next day, TV news reported that 100 million RMB was taken from the bank. The robbers counted and counted and counted, but they could only count 20 million RMB.  The robbers were very angry and complained "We risked our lives and only took 20 million RMB, the bank manager took 80 million RMB with a snap of his fingers.  It looks like it is better to be educated to be a thief!" This is called "Knowledge is worth as much as gold !"

 The bank manager was smiling and happy because his loss in the CINOPEC shares are now covered by this robbery. This is called "Seizing the opportunity --> daring to take risks!"

Spending on public works

We are spending staggering sums on our roads and MRT system. I wish to remind everyone that in some countries, excessive spending on public works is a source of corruption. (I do not wish to imply that this is the case in Singapore). 

I wish to share this joke told to me by a friend from Europe:

The head of the ministry of works of an European country attended a prestigious US business program and met his counterpart from an African country.
One day, the African was invited to visit the home of his European counterpart. It was a grand and impressive house. The African asked the European friend how he could afford such an expensive house.  The friend pointed out to the newly build highway not far away from the home and said "Do you see the new highway? It takes only a small portion of the budget to pay for this house".
The following year, the European visited the African country and was invited to the home of his African friend. It was a palace, much grander and more expensive than his home in Europe. He asked the African how he could afford it.
The African said, "Can you see the highway out there?". The European looked out and said, "But there is no highway. I only see jungle". The African pointed to his palace and said, "Well, the money is spend here", i.e. pointing to his palace.

14 May 2013

Editor, Forum Page

Straits Times

It is quite common for the public to be invited for a 

free preview on a training course to trade foreign exchange, 

commodities, futures and other financial products.

During the preview, the presenter may make some 

exaggerated claims on the effectiveness of their trading

techniques or even offer verbal promises of guaranteed 

success. 

It is easy for the public to be taken in by these exaggerated

claims and to sign up for a course costing a few thousand

dollars.

Their subsequent trading experience is often a 

disappointment. Some have incurred large losses, based on 

anecdotal evidence.

Some of the public signed up after seeing other people

rushed to the signing tables. These could be agents

who were planted to create a false impression.

The authority appears to be reluctant to put a stop to 

these practices,  

I suggest the authority should make it a requirement for 

the preview talks to be video recorded, so that they can 

be accountable for false or baseless claims, which can 

amount to the crime of cheating. 

This could be a sufficient deterrent for the time being.

Tan Kin Lian

President

Financial Services Consumer Association

Free copy of Intelligence Quiz Vol 1

You can get a FREE PDF copy of the Intelligence Quiz Vol 1 (hard copy sold for $7,90) by applying at this website:
http://tklcloud.com/cud/gift.aspx

Tell your friends to take this offer now, as it will be withdrawn after 1,000 copies have been distributed.

Note: There is a problem with the Registration as the Telephone number is being rejected. This will be fixed today.

Earned a passive income to supplement your earned income

Someone who gives talks on investing told me ....

Singaporeans study hard to get a degree and work hard to earn a salary. They do not know how to invest their savings, so they were unable to earn a passive income, from dividends and interest, to supplement their earned income.

Many of them put their savings in a life insurance policy and gave it up after a few years, losing nearly all of their hard earned savings.

I agreed with him. They do not know their priority and are destined to be poor. They can change their destiny by spending some time to learn about financial planning and investing from the FISCA talks

www.fisca.sg/events.

Are you financially aware (2) ?

Here is another test of your financial awareness.
http://tankinlian.com/admin/file.aspx?id=818&IID=825

Wisdom on how to live life

Dr. Tommy Wong, professor turned international author, has written five books on "Wisdom on How to Live Life". 

These books are written in a conversational style, which makes them easy to read and understand. The topics covered by the conversations are relevant to daily living in a place such as Singapore. In his books, Dr. Wong brings out the important message of paying attention to the spiritual aspect of living, rather than just focusing on the materialistic aspect. This change in focus can be comforting to those who are experiencing stress in their daily living. 

The style of writing in Dr. Wong's books is similar to the dialogue used by the Greek philosopher Plato in his ten books "The Republic". While Plato's books are considered one of the best works of all times, Dr. Wong's books are particularly useful to those who are living in a modern society such as Singapore.

Dr. Wong’s books are currently on offer. Further information about his books can be found here.

Big Fat Purse website

Here is my article in Big Fat Purse
http://www.bigfatpurse.com/2013/05/financial-planning-for-singaporeans-interview-with-mr-tan-kin-lian-president-of-fisca/

Training courses on Financial Trading

Many people have attended a free preview or a success seminar and heard stories of how experts make money by trading foreign currency, commodities, futures and options.

Before you sign up and pay a few thousand dollars for the course, read my paper here. It will explain why you should stay away.

http://tankinlian.com/admin/file.aspx?id=817&IID=824

Avoid Dual Currency Investments

Hi, Tan:

Thank you for your article on DCI posted on the internet.  That is indeed very insightful.  

Could you kindly educate me on the in-depth of DCI?  For am interested but would like to minimized the risk.  Am a very conservative invester - will never go for margin for am a firm believer of 'living within your means and to bless others when opportunity arise'.

REPLY

My advice is to avoid it altogether. Don't waste your time trying to figure out the complexities. 

If you want to learn how to invest to get a good return, and manage the risk, attend the FISCA talk on financial planning, www.fisca.sg/events

Sale of town council software

The issue of the sale of town council software to a PAP owned company continues to reveal baffling facts. Things are not right.

http://singaporemind.blogspot.sg/2013/05/sylvia-lim-drops-bombshell-on-aim-issue.html

Foreign wealth and income inequality

The influx of wealthy foreigners, who do not pay any significant amount of tax, is not benefiting Singaporeans as a whole.
http://singaporemind.blogspot.sg/2013/05/foreign-wealth-widens-inequality-in.html

Ask for Benefit Illustration

Hi Mr Tan, 
Is it normal for insurance advisors to show you the benefit illustration plans etc, but not giving you the handouts for you to take home and analyse thereafter (prior to buying any plans)? I have encountered this a few times, it seems like it is their company or agency's policy to do so. 

Without the numbers and terms on hand, how am I supposed to do a detailed analysis myself. The session with the agent himself is intensive. Without the printouts for me to analyse on my own thereafter, I am afraid there will be conditions and terms I would have missed out. This is not a fair system it seems like an aggressive sales strategy. No doubt there is a cooling off period after purchase, but it forces you to sign on the dotted line without giving you easy accessibility to information. 
REPLY
If I understand it correctly, the agent is required to give the benefit illustration for you to take back and analyze. If they don't, you can lodge a complaint about the unethical conduct.

Develop the skill in problem solving

You can develop the skill in problem solving by following the right approach and gain confidence in your problem solving ability. You do not have to rely on your boss or other people to think and solve problems for you.  This is an important life skill.

Give your child the opportunity to develop this skill now. Let them grow up with confidence in their own ability..

http://tankinlian.com/admin/file.aspx?id=816&IID=823

Expensive Seminars and Wild Claims

A consumer attended a 3 day seminar and came out with this observation. He wished to warn gullible Singaporeans not to be taken for a ride.
http://tankinlian.com/admin/file.aspx?id=814&IID=821

Quote:
I hope that our government will keep an eye on such activities and intervene early, I believe Singaporeans being too naive, ignorant and greedy and are not immunized to handle on the cutting-edge sales pitch. Since our government is slow to react, I like to ask people like you to warn the gullible flock.
The speakers said that Asia is the future and they have chosen to settle in Singapore, Perhaps, they have found their gold mine here, from the fees paid by the gullible people.

My Favorite Ten Commandments

This is written by an unknown author, and is being circulated in the Internet.
http://tankinlian.com/admin/file.aspx?id=813&IID=820

Are you financially aware?

Here is a test of your financial awareness. Work out your score.
http://tankinlian.com/admin/file.aspx?id=812&IID=819

Big Fat Purse

This article on financial planning, investing and insurance was written for www.bigfatpurse.com
http://tankinlian.com/admin/file.aspx?id=811&IID=818

Average bill size - by medical procedure

Here are the average bill size in B2 ward by medical procedure.

The finding is quite revealing. The cost of treatment in B2 ward is not as expensive as feared by most people. The quality of treatment must be quite good, judging by the large number of people that are treated.

The fear of high medical bills could be exaggerated by agents trying to sell expensive private Shield plans. The cost of these plans can be quite high, and the patient still has to pay the deductible and co-insurance. 

http://tankinlian.com/admin/file.aspx?id=810&IID=817

Compare bills in public and private hospitals

Cost of treatment in private hospital is 2 to 3 times of similar treatment in private hospitals. After factoring in the government subsidy (average of 50%), the difference is 4 to 6 times. 

Elderly people should opt for treatment in subsidized wards. If they go for treatment in private hospitals, the real cost is 4 to 6 times higher. 

Insurance does not reduce the cost. It adds another 50% to the actual cost - to cover marketing, administration and profit. The higher cost is reflected in the premium that has to be paid by everybody.

Many people think that insurance will help to pay their bills. They do not realize that they are paying for it through higher premiums. 

Read this article.
http://tankinlian.com/Admin/File.aspx?ID=659&Frame=1

If you can afford the higher premium, then it is all right to buy private insurance. But, if you do not have adequate savings, it is better to keep to Medishield and use subsidized wards, especially for elderly people. 

Think of needs of pedestrians

6 May 2013

Editor, Forum Page

Straits Times

The Police reported that 50 people are killed each year while crossing
the road. 

I suggest that our traffic lights control system should also be designed

with the needs of pedestrians in mind.

I have tried to cross certain stretches of roads, such as Shenton Way or

Orchard Road, and the vehicles seem  to be flowing continuously. 

The traffic lights at the junctions or overhead bridge may be too far away 

for pedestrians to walk to.

It will be useful for the traffic lights to be synchronized to allow 1 minute for

passengers to cross the road. This could mean that all vehicles should be

stopped during this time.

It could be less costly than building overhead bridge or pedestrian tunnels,

and more convenient for passengers.

The only negative impact is that motorists will have to waste one minute, but

they do have to waste the time anyway in congested roads.

Let the needs of pedestrians, especially the elderly, be considered in our

planning of the traffic flow.

Medical insurance for elderly people

I have always advised elderly people, who are not well off, to stick with Medishield, and not be frightened to buy the expensive private shields. Here are my reasons.

http://tankinlian.com/Admin/File.aspx?ID=698&Frame=1

In my personal case, I have Medishield, but I really do not need it. I have adequate savings to pay for my medical expense. I will go for B2 or C class wards, when I need to be treated. They are adequate for elderly people.

Avoid upgrading to private Shield when you are old

The daughter wanted to buy a Private Shield for her father, who was already covered under Medishield. Her father is almost 70. Due to health status, the Shield policy carried several exclusions and charged a higher premium.

Here is my reply to her:

It is best for your father to say on Medishield. There is no need to change to the private Shield, especially as they have so many exclusions and you are paying a higher premium. Even if there are no exclusions, there is no need to upgrade.
See this article in my website
http://tankinlian.com/Admin/File.aspx?ID=698&Frame=1
Here are additional articles for you to read:
http://tankinlian.com/Information.aspx?q=medical
I am waiving my consultancy fee. No need to pay me. You can give me a call at 66599611 to talk to me further.
Tan Kin Lian

Transparent and Fair Elections

Here is a way to ensure a fair and transparent election using a combination of human and electronic means.

http://tankinlian.com/admin/file.aspx?id=809&IID=816

The Malaysian election hold many lessons for Singapore

http://singaporemind.blogspot.sg/2013/05/malaysias-elections-holds-many-lessons.html

Electronic voting

I am in favor of electronic voting to replace the current manual voting process.

Advantages
1. The electronic vote can be encrypted and stored immediately in a secure server and a backup server. It is not possible to change the vote. 
2. All votes have an number that can be identified to a voter, but the actual vote cannot be read. This linkage is to identify the valid votes and ensure that there is only one vote for each voter.
3. The votes can be counted electronically by a software that is held by the Election Commission. An independent party can keep a copy of the software and do an independent count. This is to make sure that the software works reliably and has not been changed.
4. In the counting of the valid votes, there is no way of checking the identity of the voter - as the linkage is removed for the purpose of counting.
5. Can allow voters to vote in overseas locations, so long as their identity is verified.

Risk of Manual Systems
1. Fake ballot papers
2. Switching of ballot boxes enroute to counting center
3. Multiple votes by same voter
4. Counting errors

Risk of Electronic Voting
1. Tampering with the votes - solved by encryption
2. Tampering with the counting software - solved by giving multiple copies of the software to different parties, so they can run their own count and be assured that the software counts properly.

Unnecessary hassle - making life difficult for Singaporeans

I attended a meeting at the Land Transport Authority office in Sin Ming Avenue. The security guard asked me to walk 100 meters to the security post to change my NRIC to a visitor pass and to register my particulars. 

After the meeting, I had to walk back to the security post to retrieve my NRiC and to register my particulars again. To make matters worse, the security guard was not at his post. I had to wait a while for him to return.

What is the purpose of this activity? Is it to stop terrorists from entering a Government building? If so, why was I not checked for explosives in my bag?

Was it to register my contact in case there is another SARS outbreak? If this was the purpose, why was my particulars not checked, e.g. mobile phone number? In case, no one knows, SARS have been over more than 10 years ago.

Was it to know that I was in the building in case there was a fire? There are 100 other places that I visited last month, where the risk of a fire is higher. I was not recorded in all of these places.

The real answer is - Singaporeans just follow instructions and routines blindly. They do not ask - is this really necessary? is this really useful?

Maybe, they enjoy making other people go through the hassle, for nothing. Nothing will change until the minister is made the target of these measures!

Shorter lease flats

Minister of National Development, Khaw Boon Wan, has a difficult task. He wants to bring down the price of new flats to four years of average salary, but he has to placate existing HDB owners who are angry that the prices of their existing HDB flats will be adversely affected. He has announced that his plan is to stop the prices from rising, and to make sure that any fall will be "just a few percent".

It is difficult for the minister to balance the conflicting interest of existing and new flat owners. He can consider two approaches:

a)  Create a new class of "non-open market" flats that have to be sold back to HDB. This was proposed by a political party.

b) Offer a new category of HDB flats with a shorter lease of 60 or 75 years. This flats will be cheaper, due to the shorter lease.

I think that proposal (b) will be better and will not cause too much disruption to the current situation. New buyers, who does not like the shorter lease, have the option to buy the longer lease at the current prices. The cheaper flats, on shorter lease, will be more attractive to those buyers who find the current prices to be too expensive.

Currently, industrial buildings are being sold on 30 and 60 year leases, and are accepted as good investments. In time, shorter lease HDB flats will also be acceptable. Actually, many of the flats with original 99 years have their current lease reduced to 75 years already, after 25 years have passed by.

Housing prices - a Ponzi?

The inflation in housing prices can be seen as a Ponzi scheme.
Read this article:
http://singaporedesk.blogspot.sg/2013/05/the-golden-rule.html

Bad experience with Street Deal

This consumer shares his bad experience with a website called Street Deal that purports to offer products at a discounted price. 
http://tankinlian.com/admin/file.aspx?id=805&IID=812

Make business easier

http://tankinlian.com/admin/file.aspx?id=804&IID=811

Sensible approach towards security

We should adopt a sensible approach towards security, terrorism and cyber crime. My emphasis is "sensible". I do not like the blind approach towards security that is adopted in many aspects of our daily life, such as: 

1. Registering visitors to visit commercial buildings
2. Excessive checking of visitors boarding planes, even a watch will cause a beep
3. Many layers of security codes to use online banking, especially for corporate accounts
4. Need for e-mail statements to be encrypted and accessed with a password.

These excessive security measures will have a bad side effect. Being impractical, the security guard and the public will not pay much attention to it. It becomes a blind routine.

The public will avoid the use of the online measures. For example, I refuse to open my encrypted statements - as it is too troublesome. I often have to write cheques rather than go through the painful online process.

To enhance security in our public buildings, malls and train stations, I prefer to see more security guard that moves around and keep an eye on the visitors. Their presence is useful, in addition to the use of close circuit televisions.

Many of the measures were introduced during a period of real danger, for example, shortly after the terrorist attack in 2001. But 10 years have already passed, and there are new security threats to replace the old ones. We need to review the measures after a few years, to see if they are really relevant. 

My views of the Malaysian Election 2013

1.  There was a strong swing among the Chinese to the Democratic Action Party (DAP), member of Pakatan Rakyat (PR). The urban Malays was more neutral while the rural Malays continued to give strong support to the Barisan National (BN).

2. This polarization along racial lines is not good for Malaysia. It is wise for the caretaker Prime Minister, Najib Razak to call for a period of reconciliation. He is moderate and reform minded and will be able to take Malaysia through a period of change.

3. The call by the former Prime Minister Mahathir Mohd at the last minute to the Malays to reject Party Islam (PAS) probably saved BN. He is clearly strategic in his thinking. This probably contributed to the surge in Malay support for the BN, instead of PAS, in the important rural areas in Perak, Kedah and Johore.

4. It is rather sad that Anwar Ibrahim's party, Partai Keadilan Rakyat (PKR), which is multi-racial in its approach, did not fare as well as it should in the rural areas. Several Chinese candidates stood on their platform, perhaps in the urban areas.

5. I am impressed with the performance of Anwar's daughter, Nurrul Izzah. I watched some of the Youtube videos of her speeches. She is truly an inspirational leader with clear ideas of what is good for the future of Malaysia. A commentator said that she is his favorite as a future Prime Minister of Malaysia. I share this view.

6.  I am impressed with the campaign speeches of many candidates. They are able to relate well with the public and to mix Malay, English, Mandarin and dialect in the same speech. It goes will with a multi-racial audience.

7. Malaysians are way ahead of Singaporeans in politics and democracy. We have much to learn from them.

Malaysiakini provide free access for the General Election coverage

On election night, we aim to be the first to report real-time results. With journalists in all the key seats and clued in to the counting process, we will let you know who shall govern Malaysia after May 5. Apart from http://www.malaysiakini.com/, we ask readers to bookmarkwww.facebook.com/malaysiakini and www.twitter.com/malaysiakini to make sure you get access to Malaysiakini latest news. Mobile users can access the website through m.malaysiakini.com. Also, you can follow our SMS alerts. 

Taking the risk of a new Government

The general election in Malaysia is an interesting lesson for Singapore. Are Malaysians willing to take the risk to vote in a new Government?

Listen to the speech of the Nga Kor Ming, DAP candidate for Nibong Tebal and Anwar Ibrahim, leader of Perkatan Rakyat.

They are great speakers, able to mingle will with the multi-racial composition of the Malaysian voters.

http://singaporemind.blogspot.sg/2013/05/malaysias-hotly-contested-elections.html

Electronic payments

I just learned that the Inland Revenue Authority is taking a new initiative to get vendors to register and operate an account to receive payments from the public sector. The link iswww.vendors.gov.sg.

I welcome this move. It clearly reflects the unsatisfactory state of affairs in Singapore.

This type of service should be extended to the private sector as well, but the lead has to be taken by the Monetary Authority of Singapore (MAS). They cannot just sit back and hope that the banking industry will make it happen.

Concerns of young voters

The number of voters in Malaysia increased from 10.5 to 13.3 million over the past five years. The increase are due to young voters reaching voting age. 

The political parties wanted to reach out to these young voters. What are their concerns?

It should be similar to concerns of young people all over the world. Some of them are:

1. How to get jobs
2. How to pay off study loans
3. How to get a fairer and less corrupt government.
4. How to have a say in their future

Are these the same concerns in Singapore?

A degree is not required for most jobs

Minister Khaw Boon Wan said that it is not necessary to have a university degree. I agree with this statement, as a degree is not required for most jobs. It is only required for some jobs.

Making this statement is a bold step. But it has to be followed by concrete action. 

I like to make this suggestion, so that the minister can use it in his own way, and no need to acknowledge that it comes from me:

1. State the benchmark salary for most jobs and the requirements needed for the jobs.

2. This should apply to salaries in the public service, e.g. teaching, nursing, office work, security, customer service, technical jobs.

3. Employ more people directly in the public service, and avoid outsourcing these jobs.

4. Recruit young people on internship for these jobs, and assure them of a full time job when they complete the internship satisfactorily.

If the public service sets the example, they will form the benchmark for the private sector.

If our young people know that they can get a good income without a degree, many of those who are not academically inclined will be prepared to opt for vocational training. It will save them or their parents from having to incur a large loan to get a university degree that is not needed.

Holiday camp on solving puzzles

Register your child (6 years and older) for the FREE 2 hour camp after the examinations. Parents and grandparents can attend as well. More details here:
http://tklcloud.com/book/Admin/File.aspx?key=aaf46e08-9517-4028-a4ce-7c993e0faa36&Frame=1

Book here: www.tklcloud.com/book/26

Rebating of insurance

As a insurance agent I am very concerned that recently the portal below have launched sales of insurance term and whole life products online giving as much as 50% commissions back to the client. They represent quite a few reputable insurers.

http://www.fundsupermart.com/main/research/viewHTML.tpl?articleNo=8179

I know that the FAIR recommendations has suggested the sales of insurance products online which to my understanding insurers have to redesign their products to make them cheaper and not rebating commissions like this case.

With such portal in place, clients will tend to 'bargain' with agents asking for commissions rebate. Are we going back to the past practices 10-20 years ago of commissions rebate.

We may come across clients asking for quotes and finally enticed with the 50% rebates and purchased online. This will definitely impact the livelihood of the estimated 20,000 agents in the market.

Something is not right by allowing corporate entity to rebate commissions. Is this a common practice worldwide or are we the first in the world to give commissions rebate to consumers.

What is your view Mr Tan.
REPLY
I understand your concern about the practice of rebating. However, I do not have any strong views on this matter. 

I believe that a good insurance agent, who is able to advice the client properly, deserves to be fairly remunerated. It may be better for the agent to go on a fee-based basis.

Akin to deposits

1 May 2013

Editor

Forum Page

Straits Times

I wish to give my rebuttal to the letter from Miss Grace Tan Mui Gek
"Why protect these investors?" (ST 1 May 2013}

Ms Tan did not address my key concern. There are already existing laws

on deposit taking and issue of securities that are supposed to be administered 

by the Monetary Authority of Singapore (MAS). 

The gold bar scheme that promises an attractive rate of interest and return 

of capital is akin to a deposit. It should be possible for the MAS to advice the 

operators that they could be running foul of this law, and if they still persist, to 

file a charge in court.

Miss Tan give the ridiculous example of strangers standing outside the 

corridor of her flat. I am not asking the authority to act against these 

strangers.

I am asking the authority to act against a company that is registered in 

Singapore, promotes investment schemes that could infringe the 

existing laws in Singapore, advertises their dubious products through 

the main newspapers, television channels or public talks, and 

carrying on these activities for several years. 

Being allowed to operate for so long, they acquire the mantle of 

authenticity. 

By putting them in the Investors Alert List, they MAS do know

of the existence of these dubious schemes but did not take action to investigate. 

How many members of the public are aware of the existence of such a list?

Some of these products are later found to be fraudulent and have been investigated

by the Commercial Affairs Department. But the action is taken far too late, and

too many investors have lost a lot of savings. This will bring down the good

reputation of Singapore.

Tan Kin Lian

President

Financial Services Consumer Association

Bashing bad products and unethical agents

A former colleague in NTUC Income was unhappy to read several postings which he consider to be "bashing insurance agents". This is an unfair comment. 

1.  I "bash" bad insurance products that are unfair to consumers, such as taking away a large part of their savings for most duration. This is like "highway robbery".

2. I "bash" insurance agents who know the products to be bad, but hide these bad features from their clients. These agents only want to make the sale and earn the commission, but do not care about the interest of the client.

3. I know that some insurance agents, especially those who recently joined the industry, are not aware about the bad features as the training is defective. I do not wish to "bash" these agents, but ask them to learn more about the products and make a balanced recommendation to their clients.

4. I encourage consumers to buy a good insurance product, even if the premium rate is slightly higher than the lowest offer in the market. The insurance agent need to earn a living and the insurer need to cover their expenses and make a profit. Be willing to pay a fair price, even if it is slightly higher.

5. Life insurance, if properly designed, is good for consumers to save for the future and to provide protection for their family. I urge the insurers to offer the products that are fair to consumers.

Surplus in Government Budget

I heard some remarks by Leong Sze Hian in Hong Lim Park regarding the surplus in the Government finances. 

The government reported a surplus of $3 billion but according to IMF accounting conventions, the actual surplus is $30 billion. (I cannot quite remember the figures that he used, so this is based on my recollection).

He said that IMF convention recognize land sale, and transfer from government agencies as revenue to the government, but they were ignored in our government budget figures. I agree with the approach by IMF in this respect. 

I consider the reporting adopted in our budget to be under-stating the actual surplus.

Potential changes in HDB policies?

There are some discussions along the following lines:

1. Remove the salary cap to qualify for HDB houses
2. Give subsidies (grants) according to level of income
3. Remove the executive condo (EC) scheme
4. Require HDB owners to sell their HDB flats when they buy a private property.

I support these moves. They will improve the supply of housing for the people. It will also help to stabilize prices.

Sharing the results of economic growth

PM Lee said that "growing the economy is the best way to boost wages".

This is an important strategy, but it has to be supplemented by other measures. We also need to ensure that the results of economic growth are shared fairly among all the parties that contributed to the growth.

In the past decade, we have seen wages had remained stagnant for many workers, while rentals, top management salaries and profits have taken a higher share of the economic output. The cost of living and cost of housing had also increased, so many workers found it difficult to make ends meet. They have to work longer hours to earn enough to get by.

We need to introduce the following measures:


1. Implement a minimum wage that is adequate for a Singaporean to raise a family and meet the cost of living.
2. Offset the higher wage cost by an appropriate reduction in rental, top management salaries and excessive profit margins.
3. Ensure that the final cost to consumers should be kept affordable by creating a market that is free, open and transparent.
4. Regulate the working hours and terms of employment to ensure a healthy work life balance. 

These measures cannot be just "left to the market", which is the approach that is favored by PM Lee. We need a government that is more active in managing these issues. Some matters have to be regulated, while other measures can be left to the market. The government has to be wise in making the right judgment.

Solve this Einstein puzzle

Solve this puzzle, based on Einstein Quiz
http://tankinlian.com/admin/file.aspx?id=801&IID=808

Send your answer to kinlian@gmail.com.
The first 3 winners will get the PDF version of the book.

The physical book can be ordered at www.tankinlian.com/ishop

May Day Message - implement minimum wage

On this May Day, I wish to state, once again, my support for a minimum wage to be introduced in Singapore. 

1. The minimum wage should be adequate for a Singaporean to raise a family and meet the cost of living.
2. The higher wage cost should be offset by reduction in rental, top management salaries and excessive profit margins.
3. The final cost to consumers should be kept affordable by creating a market that is free, open and transparent.
4. The working hours and terms of employment should be regulated to ensure a healthy work life balance.

Workers of the world, UNITE!

Be ready to pay for time

When someone writes an email to me, expecting free advice, I give this reply to them. 

Read this:
http://tankinlian.com/admin/file.aspx?id=740&IID=746

Often, the asker is too lazy to attend talks, to read books, or even to write their issue properly. If they continue this bad habit, they will be ripped off and cheated of their savings.

Send a few dollars and hours to attend my talk or read my books and save $100,000 or more!

Bad insurance policy

Here is a warning against buying a life insurance policy. Read the benefit illustration. Look at the guaranteed cash value and compare against the effect of deduction. If you find the cash value after the 5th year to be lower than the effect of deduction, reject the policy. 
At one time, there was some regulation that give a minimum cash value. This regulation was removed a few years ago. Now the cash value can be very much smaller than the deductions. It means that a large part of your savings and interest, more than 80% in some cases, can be confiscated from you,if you are not able to pay the premiums. This is daylight robbery!
If you have bought a policy that has this bad feature, write to kinlian@gmail.com.

May Day Rally, Hong Lim Park

I am attending the rally at Hong Lim park today at 4 PM. I hope to see many of you there. 
I will not be speaking but will be interested to hear what the speakers have to see. I am bringing clappers to give away to those who recognize me. 
If you wish to sign your protest against the 6.9 million population figure, go to www.tklcloud.com/petition.

HAPPY MAY DAY.

Education policy - a horror story

When you save in an education policy for your child, check the benefit illustration carefully and make sure that you do not fall into a trap. You may be losing a large part of your savings, if you are not able to complete the full policy term.
http://tankinlian.com/admin/file.aspx?id=800&IID=807

Letter to Government Ministers

Here is a list of letters that I have sent to Government Ministers on issues affecting the lives of Singaporeans. In most cases, their response is quite unsatisfactory, such as:

• No acknowledgement or reply
• Giving a reply without understanding the issue
• Refuse to call me for a discussion before giving their reply

This is why I advocate that this Government should be changed. Their current system of governance is bad for Singapore.

http://tankinlian.com/Admin/Information.aspx?CatID=17

Facebook of Tan Kin Lian

I am now more active in posting my views in my Facebook page, www.facebook.com/kinlian. I like to ask my blog followers to set up a Facebook profile and to link to my page.

Digital display of KM of bus stop

I have written to Land Transport Authority to suggest that each bus should have a digital display that shows the km of the next bus stop. This is the same km that is used for calculating the fare.

On boarding the bus, the commuter can check the km of the desired bus stop (say 12.6 km for thomson plaza) and pay attention to the km that is displayed at the stop. The commuter will know if he is arriving or has past the destination.

The passenger may have already found the km of the bus stop from an app, before boarding the bus.

The km proposal is an alternative to the bus stop number.

The LTA feedback manager said that she takes the bus, and does not need this information. I told her that I need passengers need this information when travelling at night or rain heavily or when taking a route that they are not familiar with.

Before you invest in a new business with a friend ...

Retirees with a lot of cash should be careful about starting a new business with a friend. 

I have seen many cases where the business failed, and the friendship broke down. In some cases, the retiree is a passive investor and is cheated by the friend.

If you really wish to invest in the business, you should start by spending a few thousand dollars to get a lawyer to write a legal contract or shareholder's agreement. The lawyer can ask the right question and verify some of the statements made by the promoter.

If you wish to invest in land or other shares overseas, you should also engage a lawyer to do the necessary legal checks.

Send small money now, to avoid losing large sum of money later. Do not be "penny wise, pound foolish".

Rationalize our bus services

There are 500 bus services in Singapore. Yes, 500! Few people are aware about how complicated and messy Singapore has become. 

Due to competition between SBS and SMRT, there is some duplication of services. As the buses have to cover all the side roads, there are many services linking the same destinations but going on many side roads. 

This system is quite inefficient. The bus has to stop every 0.4 km and there are too many stops along the way. This leads to jerky buses and a long journey.

A better system is to have the bus stop every 2 km and have feeder buses to handle the intermediate stops, and also to take passengers along the side roads.

Commuters are already familiar with taking a feeder bus to the MRT station. It will be more convenient to take a feeder bus to the main bus stop, as the passenger alight and board the next bus at the same stop.

Multiple Funds in Investment Linked Policies

Do not invest in any investment linked policies that offer you many funds to choose from. Some of these funds are probably stuffed with bad assets at over valued prices. You will not be able to know one from the other. You may buy into a good fund but later the assets are switched and you get bad results. You cannot keep track of these activities. 

Anyway, a few investors have approached me with funds that show a negative return after 10 years. If they had invested in an index fund over the same period, their investment could have appreciated 50%

intimidation of Leslie Chew

Leslie Chew, the cartoonist of Demon-cratic Singapore, is being investigated by the Police for offences under the Sedition Act. 

I find this action to be intimidating and deplorable. Sedition are actions to incite disorder leading to the overthrow of the Government. His cartoons, suggesting that a minority might be unfairly treated, is an opinion that will hardly be taken seriously. 

Many Singaporeans are now quite worried whether their views and criticism of the Government might lead to investigation under the Sedition Act. 

This climate of fear is unwarranted. I urge Singaporeans to have more courage in expressing our views.

Talk - Buying a car

The date and venue for the talk "Buying a car" has now been fixed. If you wish to attend the talk and get a few tips on how to save $$$ on COE, register now. 
http://tklcloud.com/book/14

Term insurance with critical illness

Here are some indicative premium rates for a level term insurance with critical illness. It helps the consumer to decide on choosing 20 or 25 year term and gives benchmark premium to compare with other insurers.
this policy is taken individually and is not part of a group insurance scheme.
http://tankinlian.com/admin/file.aspx?id=796&IID=803

Teaching students how to solve problems

I gave a 2 hour talk to teachers of primary 1 and 2 in a school on the use of shape quiz and tangram to teach pupils about solving puzzles. They enjoyed it. They placed an order for 400 books on these puzzles to be used by their pupils, using their edusave funds. The school gets a 50% discount on these books.

Schools interested in this talk can write to inbox@tankinlian.com

Parents can order the books for their children and help them to develop the skill of problem solving. 

Order at
www.tankinlian.com/ishop