Saturday, May 27, 2006

Combined Fund or Global Equity Fund?


Mr Tan

Can I have your advise for a regular saving plan of $200 monthly over a 20 years investment period, into Combined Fund or Global Equity ? Since you did mention that these 2 funds are good. But which one is better if you would like to invest this much over a 20 years period ? Thanks!


I prefer Global Equity, but the Combined Fund (Growth) is also quote good (for those who wish to have a lower level of risk).

I suggest that you attend my educational talks. Call 6877 3366 for the date of the next talk.

Friday, May 26, 2006

Funds managed by Fidelity


Fund Size and Annual Charge
- Most Fidelity funds are $200m in size.
- Annual Charge is 1.5% for equity fund, 0.75% for bond fund.
- 15 fund offered under CPF investment (3 balanced funds, 1 bond fund, 11 equity funds)

Sales Charge and discount
- Sales charge for bank distributiors is 5%. Discount in the form of higher return on Fixed deposit (at least 3%)
- Sales charge for online distributor is about 1.5% to 2.5%.
- Sales charge for brokers is 5%.



- fund size: $3,800 million
- annual fee: about 1%
- asset class: growth fund (70% equity, 30% bond
- sales charge: 3.5% (reduced for large investments above $20,000)

A better way to pass your assets to your family


I wish to get your expert view.

Currently, many banks are encouraging clients to buy Insurance Trusts as part of estate planning. Typically, it is a significant single upfront payment with both guaranteed and projected returns and insurance payable upon death to named Trust beneficiaries.

Advantages are supposed to be faster probate process, additional estate duty exemptions and protection from creditors



Here a few points.

1. Be careful of the product. You must find out what is the return that you get. Most products offer a fairly low return, due to the high commission paid to the agent or the bank.

2. If estate duty is a consideration, you have two options. One is to write it as a trust policy under section 73, which allows the policy to be treated as a separate estate. This can be done independently of the product. It enjoys special estate duty.

But, under a trust policy, the rights are transferred from the policyholder to the beneficiaries - so the policyholder cannot change the mind and "take back" the money.

3. Another option is to place it under a revocable nomination. This is available from NTUC Income and later from the other insurance company as well.

4. I suggest that you go to read about it in Or give a telephone call to X who is our expert on this matter.

5. What you want to do can be done with NTUC Income, and you get a much better return!

Wednesday, May 24, 2006

Car-sharing is a better option for many people

In the past months, the newspapers had reported on the sharp drop in new car prices.

Many people, particularly the younger ones, rush to the car showrooms and sign on the dotted line to buy their dream car.

This dream may not last when the true cost of car ownership strikes home.

For instance, if you buy an off-peak Nissan with a 95% car loan repayable over 10 years, you have to pay a monthly instalment of around $350. Add road tax, insurance, maintenance, petrol and parking charges, the total cost jump to $600 to $700 a month.

This is not a small sum for a young person just starting out on his career and burdened with a 10-year financial commitment.

I suggest a better option. If your job does not require you to use a car, you can consider car-sharing.

NTUC Income operates a car-sharing scheme with 200 cars serving 5000 members. A member spends between $50 and $200 per month depending on their car usage. For some months, they spend nothing if they are overseas or have other lifestyle priorities.

A car-sharing member have nearly the same benefits as private car owners.

50 million hits a month at our websites!

The two websites managed by NTUC Income, ie and Big Trumpet, receive a total of 51 million hits in March 2006.

This represents 1 million visitors a month (assuming that each visitor contribute to 50 hits).

This must be one of the most active websites in Singapore.

We estimate that 30% of the visitors are from our own staff and insruance advisers. 70% must be from the public, ie our customers.

Excess on motor insurance

The Excess is the amount payable by the policyholder as their contribution towards a claim.

Some insurers peg their standard Excess just below NTUC Income and publicise it in their materials.

They conveniently omit to mention that young and inexperience drivers are subject to higher Excess.

They also impose an additional Excess for unnamed drivers.

Product Features INCOME Co-A Co-AX Co-R Co-C Co-H
Basic excess $500 $450 $200-$600 $450 $500 $500
Young driver $2000 $3000 $2500 $3950 $2500 $1500
Unnamed driver NA $450-$550 $500 $750 $500 $500

Is it time to invest in equities?

Two weeks ago, I mentioned that the global equity markets are "correcting". I indicate that I may want to make a further investment within two weeks, after the correction is over.

The correction has been slightly more severe than I expected. So, the various markets have come down by 5% to 10%.

I shall be carrying out a further review. I think that it may be time for me to make my further investment later this week, or earlier next week.

I shall post my decision soon.

Why do customers come to our business center?

Here are the views of 10 customers who bought policies through the Business Center:

1. 40 % feel that agents only come around when they want to sell something and they are agressive in the approach. They feel at ease when they walk into the Business Center to buy their policies.

2. 40 % of them feel that agents do not give after sales service so they prefer to deal with directly with the company. Comment for one PH.....Agents come and go but the company is always there.

3. 20% feel that we give better value in terms of our vouchers (for direct customers).

4. All of them fell it is hassle free and straight forward to deal with the Business Center.

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