Saturday, December 24, 2016

How to tell a good life insurance policy from a bad one?

Many people buy a life insurance policy as a form of long term saving and investment. This article explains how to identify a good insurance policy from a bad policy, Before you commit to a long term saving plan, you should read this article. You should NEVER trust the marketing pitch of the insurance agent or the bank officer blindly.

Join and become part of the "Wisdom of the Crowd"

I need your votes on these issues. When more people votes, the results become more credible. This is called "the wisdom of the crowd". Give your votes now and be part of the wisdom.

You can view the results of the issues that have closed here:

How to reduce the jerkiness in bus

I have done research into the cause of jerkiness in buses. It seems to be a world wide problem. We face it in Singapore as well.

One important factor is bad driving habits. The drivers slam on the brakes too hard and accelerate too fast. They are not aware of the discomfort caused to passengers. Maybe they know, and do not care.

Someone suggested to use the accelerometer in the mobile phone to measure the jerkiness of the journey. He suggested that a prize be given to the drivers that have the least jerks, or give the smoothest journey.

I found an article in the New York Times that explains how the accelerometer works. I have engaged a developer to develop an app that measures the number of times that the bus jerks on a journey. With this app, it is possible for the bus company to send the jerkiness record to the server. They can view the record of all bus drivers and pick out the drivers to award the prize.

The bus company can also identify the drivers that have bad driving habits. This can be used to provide feedback and training to the drivers. When the drivers know that their driving habits are being monitored, a miracle will happen. They will be conscious of the bad habits and will take pains to improve their performance.

New paradigm of work

I spoke to a security guard at the airport.

TKL - Are you from Singapore?
Guard - Yes.
TKL - Do you work full time?
Guard - Part time
TKL - How many days a week do you work?
Guard - 5 days.
TKL - That is like full time!
Guard - I have flexibility. If I want to stop work for a while, e.g, to go on holiday, I am allowed to.

This is the new paradigm of work. There is flexibility for the worker and the employer. If the employer does not need the worker, there is no work to be done.

The worker needs to have savings to tide over the period where the work is reduced.

Shameful state of the public service

Is the Singapore Police Force understaffed or unproductive?

This is the question asked by Philip Ang in this letter to the Commissioner of Police.…/is-the-spf-unders…/

I have personal experience in lodging three complaints to the Police over the past 15 years.

In all of these cases, the investigation was shameful. Nothing was done. The investigating officer did not call me for discussion on any of these complaints.

I asked the officer specifically in one case - did you call the accused for an interview. He replied "No". He spent six months doing paper research.

I don't know what happened in the other two cases. They were closed after six or more months. I suspect that the investigating officer did nothing all of this time.

This is the quality of the investigation by our Police Force.

I also had disappointing experience in providing feedback to government agencies and to ministers. They sent a standard reply and did nothing. They don't want to understand the root of the problem.

The public service will continue to go downhill under the current government.

Friday, December 23, 2016

Database audit

A big risk faced by companies is fraud by internal staffs. As a deterrent, the company should send its database to an external consultant to carry out a database audit. This new concept is explained here.

A new approach for a smart watch

I have used a smart watch (MyKronoz Zeround) for two weeks. I conclude that it is not practical. It gave too much hassle and does not really give convincing value to me. I have reverted to the traditional watch. I also read a report that many users had the same experience with the smart watch.

I like to share my views about how the smart watch should be re-designed.

The current design is to have an app in the mobile phone which connects the mobile phone to the smart watch continuously through blue tooth. This interferes with the function of the mobile phone and degrades the user experience. It also drains the battery.

My new approach for the design of the smart watch is:

1) The smart watch operates like an ordinary watch and give the functions of telling the time, date, world time, alarm, timer, etc.

2) When required, it can connect to the mobile phone to update the time, e.g. when you are travelling to a different time zone, to get the weather forecast, agenda for today or other information (which can be programmed in the mobile phone. The connection is for a short period to get the information and is then disconnected.

3) The setting for the smart watch, can be made at the mobile phone, and retrieved by the smart watch. It is easier to make the setting at the mobile phone.

4) The fitness record can be viewed through the smart watch or transferred to the mobile phone to be viewed with a larger screen.

The mobile phone app can be made smaller and is tailored to be a slave to the smart watch. This is a different approach from that adopted now by most smart watches, which works in the other way round.

Ask the right question

I wish to give this example about asking the right question.

Suppose the question is - how do we make our buses run more smoothly without the jerkiness. Can we use technology to reduce the jerk?

This may be the wrong question.

The right question should be - should we replace buses by trams that run on rails, like in some cities?

Buses have to run on fixed routes. When running a fixed route, it is better to use rails as there is no need to need to move from one lane to another. The tram only need to stop and it can be done in a smooth manner.

A sense of duty and honor

My friend works as a civil servant in Hong Kong. They get a good salary but do not get a bonus to "motivate" them towards certain targets.


She explained that the bonus may get the bad behavior. The public servant is required to carry out the expected duty without the bonus to "motivate" them,

I agree with the approach adopted in Hong Kong.

I disagree with the bonus that is given to civil servants in Singapore based on the state of the economy or other reasons.

I like our civil servants to be paid well, like in Hong Kong, but there should not be motivated by bonuses. We have to develop a sense of duty and honor.

Make it easy for companies to submit returns to government agencies

I find it very troublesome to submit CPF, GST and other returns to government agencies. It is troublesome just to sign in to their website, e.g. SingPass, 2FA. I often forget the password.

After passing through, I have to go through a maze as the website has more than 100 links and they are hidden under many layers. If I can remember the link, it is okay. But I keep forgetting the link as I do not use them regularly.

I decided to build a simple approach. It is shown here:

I showed it to the person in charge of this project in the Infocomm Development Authority. They are not interested to look at it.

Troublesome to submit CPF contribution for my employees

I have to submit the monthly CPF contribution for my staff. The website asked me to sign in with my SingPass and my password. I forgot the password.

Ever since SingPass asked me to create a "funny" password with special character and capital, I keep forgetting it. I had to get it from a manual notebook. Luckily I could find it.

The people who designed this security systems forget that the ordinary users have to remember hundreds of passwords and uses many devices. To make matters worse, I have to create separate accounts for company use.

Now Singpass adds a 2FA and require a mobile phone to enter an OTP.

Why do they keep adding layers and layers of security? If someone wants to pay my employee's CPF on my behalf, they are welcomed to do so.

I have tried the app called "Last Pass" before and abandoned it.

Merry XMas and best wishes for 2017

Thursday, December 22, 2016

Two biggest investment mistakes

The two biggest investment mistakes made by many people everyday are:

a) Buying a life insurance policy without reading and understanding the Benefit Illustration
b) Buying an investment product from a bank without realizing that it is actually a life insurance policy.

This mistake can cost them a few thousand dollars or tens of thousand dollars. They usually realize it after a year or two, or maybe slightly longer.

To avoid this mistake, learn how to read the Benefit Illustration. It is quite simple. You only need to know what to look for and what the figures meant.

You will realize immediately that you are falling into a trap. You will then be thankful that you have read this article!

Understand the Benefit Illustration

After you have read this article (click on the PDF below), you are likely to avoid investing your savings in a life insurance policy.

You can still buy life insurance to provide protection against premature death or injury through accidents or natural causes, but NEVER AS AN INVESTMENT.

However, some policies may still offer a good deal, provided you know what to look out for.  This shown in the Benefit Illustration. But you have to learn what to look out for.

A new paradigm in risk management

Many organizations are paranoid about security. They think that their business risks are hackers from outside. They do not trust outside service providers, such as Cloud services, or external consultants. They do not realize that their biggest risks are their own employees.

The employees could steal money (like in this case) or sell sensitive data to outsiders (as has happened in DBS Bank in Hong Kong). They employees can also take company secrets with them when they move to the competitor.

Companies should adopt a new paradigm in managing its risks.

Move from Free Trade to Fair Trade?

A CNN news alert said that the Trump transition team is studying the possibility of an executive action to impose import tariff into America.
I believe that the re-introduction of import tariff in all countries around the world is necessary to deal with the different wage levels and cost of living in these countries.
It is an attack on "free trade" but is the embodiment of "fair trade", which will help to protect the workers to get decent wages.
I hope that the Trump administration will make this possible. It will lead to less global trade, but will be result in lowering the income gap in most of the countries.
There will be winners and losers in the "fair trade" regime and that countries can adjust to the new regime.

Breakdown of the votes and individual comments

Are you surprised by these results?

1) 60% of the voters think that Dr. Ng Eng Hen is likely to leave the government. He is on his way out.

2) 77% of the voters disagree with the government on asking for a "formal reason" for the detention of the SAF vehicles. They think that the government should de-escalate the issue and settle it quietly.

3) 80% of the voters think that Singapore has a bad human rights record.

You can watch a breakdown of the votes and the individual comments in

Results are now out on these issues

The results of the voting on these issues have now closed and can be viewed at

1) Why was Dr. Ng Eng Hen not elected into the PAP central executive committee?
2) Should Singapore ask for a "formal reason" for the detention of the SAF vehicles in Hong Kong?
3) Does Singapore have a good human rights record?

Several current issues are available for your voting at

Please add your vote to make the results more credible. We aim to have 50 votes on each issue. Please play your part to develop a more active culture in Singapore.

Save for a rainy day

In my talk on financial planning, I advised ordinary people to set aside 15% of their income as savings for the future. This savings is to be invested in an index fund and not in a life insurance policy. It is to be used for emergencies and to retirement.

This the saving is set aside in this manner, it should not be used to purchase a property. The HDB flat or private property should be bought without touching this saving. It also mean that the worker  should buy a smaller property, as their disposable income has been reduced the amount of saving that is set aside.

An important use of this separate saving or emergency fund is to supplement the income during a recession. The recession may lead to loss of job or to a reduction in the regular income, e.g. when the worker has to take mandatory no-pay leave or earns smaller commission on sales.

By tapping on the emergency fund, the worker does not have to pay high interest charges by borrowing from the bank, loan shark or other sources. The high interest charges will add to the financial distress.

This concept is explained in my talk on Financial Planning. I hold this talk every few months. The next talk is on 14 January 2017, but all 60 places have been fully taken up.

How to deal with retrenchment of staff

During a recession, companies have to reduce their workforce. Some companies did it well. Others did it badly and caused financial distress to the retrenched staffs and fear among the remaining staff.

Here is a good approach:
The company offered an attractive package for staffs who are willing to leave the firm. They may lose some of their better staffs, but these are staffs who have to option to work elsewhere or are able to make adjustments. If enough staffs take up this offer, the company has solved its downsizing well and everyone is happy.

If not enough staffs take up the exit package, the company has to adopt the next step. Some companies ask their remaining staff to take a mandatory no-pay leave. It applies to all the remaining staff. If the no-pay leave is one day a week, everyone takes a 20% salary cut and enjoys 20% more free time. This is a fair approach.

Here is a bad approach:
The bad approach is to decide on the staffs to be retrenched. It means that the retrenched staffs have to take a 100% pay cut (although they may enjoy some retrenchment benefit to tide over a certain period). There is uncertainty and fear as to the people who will be selected for retrenchment. Favoritism and politicking come into play.

I hope that companies will adopt the good approach.

Wednesday, December 21, 2016

Philippines, China and the disputed islands

This is my personal interpretation of the events. It is based on my observations and is subject to errors.

Philippines bought the case of the disputed islands to the International Court of Justice at the Hague, Netherlands. The Court ruled in favor of the Philippines.

President Duterte did not shout "Rule of Law". Instead, he paid a state visit to China. He told President Xi of China, "Big brother, my fishermen needs to fish for a living. Can you allow them to continue their livelihood? They are poor people.

And the resources around the islands, can both our countries share these resources? Let us go for win-win, okay?

And big brother, can I invite your China enterprises to invest in the Philippines and help to build our infrastructure? We know that this is a business deal, so we will make sure that your companies get a good return on your investment, okay? "

President Xi invited President Dutarte to a state dinner. They signed the agreement on the South China Sea and on investment in the Philippines. At the state dinner, President Dutarte did not crack any jokes about polluted rivers and polluted air.

President Dutarte does know how to get a good deal for his country. He also knows that he has to respect big brother. Maybe our PM Lee should get a lesson from President Dutarte? Do you agree?

Poor service fro m bus drivers

A few days ago, I arrived at the bus stop. My bus was about to leave the stop. I run towards the bus. The driver saw me and waved me to the next bus. I thought that the next bus would arrive soon.

The bus was late. Instead of the usual interval of 12 minutes, I had to wait more than 15 minutes. If the earlier bus had waited 5 seconds, I would have boarded it. But it did not - so I had to wait 15 minutes. This is poor service.

Quite often, there is a passenger in a wheel chair in the bus. The bus captain had to stop the bus, come to the exit, open the ramp for the wheel chair to leave the bus. That is considerate and is part of the standard operating procedures. The passengers had to wait for 1 minute for this process to be completed.

What is wrong waiting 5 seconds for a passenger to board the bus?

Wasteful to use printed guide for each bus service

SBS Bus 163 provides a printed brochure showing the service route at the front of the bus. The passenger can collect a brochure to read.

A better way is to have a large display pasted on the bus. There is no need for the passenger to collect the brochure. It is wasteful to have the printed guide which is usually thrown away.

These printed guides have to be replenished - which requires additional work. If they are not replenished, the passenger could not check the route.

I have travelled in buses and trains in other countries. They have a large display in the bus or train. They do not use the printed guide.

Why does our bus management use the printed guide? Are they trying to give business to their friendly printers? How wasteful.

Is it good to buy Eldershield or its supplement?

Leong Sze Hian wrote an article about Eldershield. $90 million were paid in claims but the total premium and accumulated interest amounted to $3,000 million.

Someone said that a minister had explained that the payout is low because the insurer needs to build up a reserve for future claims.

Do not believe this minister (I don't know who he is). Even after allowing for building up the reserves, the premium charged for Eldershield is too high.

Read this article.

If an insurer ask you to buy a supplement for Eldershield, you should decline. Here is the explanation.

My experience with a smart watch

I have been trying the MyKronoz smart watch for the past two weeks. Initially, I found it quite useful. My assessment has now changed.

I had problem receiving phone calls on my mobile phone. It is automatically sync to the smart watch. I have to deactivate the blue tooth to talk through the mobile phone.

I also had problem establishing the connection to the smart watch - to view the weather.

So, I am likely to give up the smart watch and to use my old $35 Casio watch. For the fitness scores, I will use my mobile phone.

It was a good learning experience. My friend, who uses the Samsung Gear, found it to be quite useful. It is a high end smart watch.

Tuesday, December 20, 2016

Is this utopia?

Imagine a country where all citizens are assured of a job that earns enough for them to raise a family. These people may not be super rich, but they can get by. They have to work hard, but only for 40 hours a week. They do not have to worry about unemployment. Is this a good country to live in?

It is possible to have a country that operates such an economic system. What type of economic system is this?

It is important to understand the question

I told this story in a seminar in Bangkok. It was well received.

I took the actuarial examination through self study while I was working full time. I did not have time to prepare well for each subject. On leaving the examination room, I often got the impression that I would fail the paper because I could not answer many of the questions. I was often surprised to learn that I passed the paper. At first, I thought it was just good luck.

Many years later, I understood a different perspective. Although I did not know the answers, I understood the questions. The examiner decided to give me a pass, because I understood the subject.

It is as important to understand the question as to get the right answer. Often, it is important to ask the right question.

At the close, I asked the participants to tell me what they learned during the seminar. Two older participants mentioned that it is important to understand the question and to ask the right question. They understood this principle through their many years of working experience. 

Gather the facts

One bad habit, which is quite common today, is the lack of initiative, when someone encounters a problem. They immediately conclude that they do not know the answer and passes the problem to somebody else. They do not bother to get some facts to understand what the problem is.

A good habit is to gather the relevant facts to understand what the problem is. This fact gathering will be helpful to the next person who has to take over the problem.

It is not difficult to gather the facts. It is the first step for someone else to find the solution. It is the duty of "the first responder" to assess the situation and pass the fact to the expert to solve it. Everyone on the scene can play the role of "the first responder".

Improve the quality of product

50 years ago, most manufactured products came from England. I remembered that it was easy to open a bottle with a twist of the cap or to tear a package at the marked location.

As the years went by, more manufacturing came to low cost countries. I observed that it became quite difficult to open the caps of bottles. I have to use a cloth to increase the friction. Sometimes, I had to look for some tools.

It is also difficult to open a package at the marked location. Often, the location is not properly marked or it does not tear. I have to use a scissor to cut the package.

The airlines do not allow scissors to be taken on board and the hotels do not provide scissors. I often had a hard time tearing the instant coffee package.

In the rush to mass produce the products at low cost, the attention to detail is abandoned. The pride in getting the work done well is gone.

We can afford to pay a little more for our product, or the distributor can take a little less profit. Life will be better if the quality can be improved just by adding a little attention to detail.

Sunday, December 18, 2016

Understand how an annuity works

Most people have a hazy idea about how an annuity operates. They do not realize that there are many types of annuities providing different benefits. These many variations can be grouped under three main types. It is explained here.

Watch all the videos

Most visitors watched only the videos on the financial planning topics that they are interested in. On average, each visitor watched two videos.

There are 10 videos covering differen topics. I encourage you to watch all of them, as they are relevant to consumers.Each video takes only 5 to 10 minutes.

Are the SAF vehicles still being detained in Hong Kong?

The SAF vehicles have been detained in Hong Kong for nearly three weeks. Have they been returned to Singapore? I have not heard any update on the news for the past two weeks. The latest that I found online is the following:…/formal-reasons-for-the-detent…

What is happening? Are we still waiting for a "formal reason" that is not forthcoming from Hong Kong?

New issues for your vote - Wisdom of the Crowd

I have two current issues for your voting:

1. China detained an underwater drone in the disputed South China Sea.
2. President Dutarte visit to Singapore.

Give your view and vote in

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