Saturday, August 31, 2013

Important message for young people

Many young people focus on their jobs and do not pay much attention on their financial planning.

Most of them are approached by their friends to take up a life insurance policy to save for the long term.

The life insurance policy is likely to give them a poor yield due to the large sum that is deducted from the premium to pay the high marketing and other expenses, and the profit of the insurance company.

This large deduction is shown as "effect of deduction" in the benefit illustration, but most consumers do not understand what it means. The effect of deduction could be more than $100,000 or even $200,000 in some cases.

If you know how to buy the right type of insurance and to invest your savings, the actual cost of the insurance cover and investment service should be less than half of the "effect of deduction".

It is very important for you, as a consumer, to spend some time to understand this important concept. For a start, you should read the articles posted under "Ask Mr. Tan" in this website,

There are about 10 articles here, but the most important is the article on "Financial Planning, which can be found at You can also take the financial awareness test.

If you realize that you are quite naive about insurance and investment, you should act immediately to buy the book on financial planning ($6 only) and to attend the FISCA talk on financial planning ($10 for members). They can make a lot of difference for your future.

Do spend the time to read the other articles in the website and to attend the other talks by FISCA.

I am taking an advertisement in Facebook, targeted at young people between 20 to 30 years.  While it cost me some money, I hope to be able to reach out and help some of the young people to avoid being taken for a ride.

If you fall within this group, this message is for you. If you are older, please help me to spread this message to your children or younger siblings (in the target age gropu), so that they become aware of making the right financial decision.

Tan Kin Lian

Friday, August 30, 2013

Learn about financial planning the low cost way

Mr Tan, 
I have a happy family with 2 young teenagers. Both I and my wife are working and our income are at typical sandwich level. As we are growing old, we also feel uncertainty. We like to know how to make a wise financial planing and wise and low risk investment. Please advise. 

You can get your answer here

Look into for answers to other topics.
If you want individual consultation, my fee is $150 per hour.

Thursday, August 29, 2013

Non-regulated products sold by financial adviser

A consumer approached me for help. She had invested $28,000 in an investment plan that was supposed to give her a monthly payment of $375 for 24 months and the full refund of her investment.

The plan was sold to her by a financial adviser working for a large, reputable life insurance company.

After receiving the payment for a few months, the payment stopped. She wanted to ask for a cancellation of the contract and a refund of her money. She was given a post dated cheque and after waiting for the due date, she was told that the company did not have the funds to pay her.

The documents for the contract showed that she had actually purchased 6 magnetic bangles which was supposed to be rented to users and the monthly payment was the rental fee for the bangles.

She had done some investigation and learned that the company promoting the scheme had been operating under various names for the last 20 years. She was surprised that they were allowed to continue for so long, cheating many people.

In her case, she was misled because the financial adviser, which is regulated by MAS, had recommended the investment to her and assured her that it was a safe and good investment to give her a retirement income. Instead, she lost her capital.

She allowed me to share this story to warn other consumers to be careful about the non-regulated products that are being marketed by financial advisers. The consumers could be easily misled.

She is keen to find a way to get back her money. I asked her to file a complaint against the financial adviser and also approach the Small Claim Tribunal to get her money back from the company that promoted the scheme.

Any helpful suggestions will be welcomed!

Tuesday, August 27, 2013

Class action on the Pinnacle Notes

Here is an update of the class action being taken by Singapore investors against Morgan Stanley on the Pinnacle Notes case.

The judgment, up to now, has been in favor of the Singapore investors. The delaying action by Morgan Stanley is deplorable.

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