Singapore First Investment, Insurance Blog

What is Annuity?

An Annuity is a contract that provides a guaranteed income to the annuitant for life (or a shorter specific period) with income payments made annually, semi-annually quarterly or monthly.

Annuities have sometime been described as the opposite of life insurance because life insurance provides protection against someone dying too soon, annuities provide protection against someone “living too long” - living so long as to outlive one’s financial resources.

Although not strictly a life insurance product, annuities are sold by life insurers in Singapore. One can either use cash or the CPF Minimum Sum to purchase annuities.

Buying Annuity Policy For Retirement

Purchasing annuity policy is a more feasible choice than leaving the money in the bank for most people. The reasons being:

• the person may not have the discipline to not to over draw from the account for reason such as going for tours more often than planned. This will cause the principal to deplete faster.
• Annuity policies are specially designed to protect one against living too long and outliving his resources
• Depending on the type fo annuity purchased, the annuity payment may continue to be paid even though the principal sum (purchase price) used to purchase the policy has been exhausted.

Benefit of Annuities

• Annuity payout is free from income tax
• Provide guranteed income
• Provide option for annuitant to pay the purchase price over his working years
• Investment returns earned during the accumulation period is tax free
• Capital may be guaranteed depending on the types of annuity purchased

Limitation of Annuities

•  Cannot be used for death protection and should be purchased only after provision for pre-mature death is in place
• cannot be used to provide for major illness protection
• Not suitable for people in poor health
• Usually does not have any feature to counter the effect of inflation

If you are looking for an annuity for yourself or your parent, feel free to contact me! Being an independent consultant, I have access to almost all the annuities available in Singapore. Because of that, I have done some comparison on each annuity so as to understand which plan is most suitable for different type of client, and which plan give better returns. Call me direct at 91059260 or email at jack@investmentsg.com

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The Retirement planning process is made up of 6 steps:

1. Establish Goals
2. Gathering Relevant Data
3. Analysing The Data
4. Developing a Plan
5. Implementing The Plan
6. Monitoring The Plan

Let me bring you through the steps and explain how I usually use these steps to help my clients customize their retirement plan.

Step 1 - Establish Goals

Client’s goals vary significantly depending on many factors including health, age, marital status, number and age of children, different in the ages of the husband and wife and personal preferences. Also clients’ goals will vary depending on his personal definition of retirement. For some, retirement is the last day they have to work for others, it is the last day they want to work and for still others, it is the last day they can work.

As such effective retirement planning begins with identifying and prioritizing my client’s retirement goals. The goals identified must be both realistic and attainable. Example of retirement goals include:

• Maintaining pre-retirement standard of living
• Maintaining economic self -sufficiency
• Minimizing taxes
• Retiring early
• Adapting to non-economic aspects of retirement
• Passing on wealth to others
• improving lifestyle in retirement
• aring for Dependants

Maintaining their standard of living despite the loss of income from employment can mean a variety of things to clients. For some clients it may mean being able to stay where they are without dramatic loss of purchasing power. Other clients may be willing to move to a less costly house in order to maintain their purchasing power. client who are active in leisure activities such as golf will want to continues these activities.

Maintaining economic Self-Sufficiency

An objective that goes hand in hand with maintaining one’s pre-retirement standard of living is the desire to remain self-sufficient throughout. Many clients fear becoming dependent on children, charity or the government. This may be a significant reason that clients actually cut back on spending in retirement. Financial independence takes on even more importance when one considers that many other constraints may be imposed on their independence such as their ability to work drive or be physically mobile.

Minimising Taxes

An important goal common to all clients is their desire to be tax wise regarding their retirement funds. Paying the least amount of taxes on their retirement distributions investing for the best after tax yield and maximizing tax-shelter opportunities with their retirement capital are special priorities that my clients will have.

Retiring Early

A characteristic of modern times is that many peopl want to get out of the rat race as soon as possible. Early retirement is popular for several reasons:

• Health problem that client is currently facing
• fear of future health problems
  (the get out now while I still can enjoy it philosophy)
• care giving concerns due to health problems of loved ones
• corporate downsizing
• retirement of a spouse
• death of a spouse

If my client seeks early retirement, it is even more important to start retirement planning at a young age and to accurately estimate the retirement need. These extra precautions are necessary because the lengthened retirement period is subject to compounded increases in inflation. Furthermore the shortened pre-retirement period is subject to increased drain on current cash in order to fund the extended retirement period and for medical protection.

Adapting to Non-economic Aspects of Retirement

In addition to relevant economic objectives my clients will have to meet, they will also have non-economic objects such as:

• using leisure time more effectively
• adapting to a nonworking environment
• coping with deteriorating health
• coping with care giving responsibilities
• adapting to a fixed income relocating after retirement

These and other non-economic factors also have impostant economic implications. For example, replocating after retirement can affect the overall pool of retirement assets because the sa;es of the home may provide surplus assets.

Improving Lifestyle In RetirementClients with the objective of improving their life-style in the retirement years are willing to make extra sacrifices prior to retirement in order to enjoy some luxuries, such as travel, during retirement. another set of planning problems is created if the person’s objective is to plan for a more costly life-style during retirement. These individuals will need extra resources in order to fulfill their dreams.

Caring for Dependants

Another retirement objective for some people is to have the ability to support a dependent. This typically occurs when a dependent needs frequent physical or medical care. Special and distinct planning considerations are required depending on whether the dependent is a child, sibling or parent. In addition to the normal living expenses during the dependent’s life expectancy, you must also consider whether there will be medical bills, additional living expenses, and any other financial drain on the client’s retirement income.

Other Goals

In additional to the general retirement goals discussed above, my client may have one or more of the following specific retirement goals:

• Providing for secure investments-investing assets to minimise potential losses and make the client feel secure about his investment.
• coping with health care costs– purchasing a Major Medical expenses policy may be required to cover health care costs no covered by group health insurance, basic medical expenses insurance as well as CPF approved medical insurance schemes.
• staying as healthy as possible — ensuring adequate funding for health clubs and other leisure activities

Very often, I will find my clients’ goals conflict with each other as well as with the demands and reality of their daily lifestyle. For example, a client may say that his goal is to retire early and he wants to maintain economic self sufficiency. However, based on his financial standing, he will not be able to achieve self-sufficiency if he were to retire early. In fact, if he wants to have self-sufficiency after retirement, he should retire later. Such clients will have difficulties setiing aside enough money from their current incomes to meet their retirement goals. Thus, you have a duty to help your clients set the right goals so that they are both realistic and attainable.

Having determined the goals, I will move on to step 2

Step 2 — Gather Relevant Data

In this step, I will be doing a fact find to gather more information from my client. The information which I need to obtain include:

• an inventory of assets and liabilities
• annual income
• estate planning information
• any existing insurance coverages
• amount of CPF saving
• information about employer-sponsored retirements plan
• information regarding the client’s risk tolerance
• his current desired retirement age
• his marital statues
• his employment status
• which life cycle he is in
• any dependants
• any health problems

Step 3 — Analyse The Data

This third step requires myself to analyse the date and to quantify the needs uncovered. The data gathered earlier will enable me to determine where my client stand financially for his retirement purpose. It will also enable me to assess my client wants to be financially during retirement as well as his ability to reach his goal.

To compute the client’s retirement needs, I have to add up my client’s existing resources. These may include:

• bank deposits
• investment
• CPF saving
• supplementary retirement scheme
• endownment insurance policies
• annuities
• property rental income
• reverse mortgage
• proceeds from downgrading to a smaller residential property

Once a financial inventory of possible sources of retirement income has been taken, the next step is to determine how much annual income will be needed in the first year of retirement to achieve the client’s goals.

Step 4 — Develop A Plan

In this step I will road map the way for my client to achieve his goals. To begin with I have to determine the type of products that can be used to fund the client’s retirement needs that I have arrived in step 3

When recommending products for my client’s retirement, I always bear in mind the 2 basic principle

1. Only recommend products if my client needs them, and
2. Only recommend products which are the most suitable for my client given his circumstances.

In the plan development process, I must consider how to use CPF saving , insurance policies annuities, unit trusts, shares and the net inflow/saving to maximisie the overall investment returns and meet the retirement funding need.

Once the plan has been developed, my next job is to present it to my client.

Step 5 — Implement The Plan

It is my duty to help implement every aspect of the financial plan which I have proposed and accepted by the client.

Step 6 — Monitor The Plan

The process of identifying and satisfying a client’s needs does not stop with the implementation of the plan. My client’s circumstances may change or there may be external developments which may affect my client. As such, it is important that I conduct an least yearly review with my client regularly.

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In retirement planning, there are a number of assumptions that I will  needs to take into consideration as these assumptions will have an impact on the final plan to be recommended to my clients. The assumptions can be grouped into two categories: Qualitative Assumptions & Quantitative Assumptions

Qualitative Assumptions

Qualitative assumptions refer to the type of lifestyle that a client wishes to have upon his retirement. The common assumptions include:

• whether to continue working
• whether to downgrade to a smaller house or to sell the current house and rent one instead
• whether to pursues expensive hobbies such as golf
• whether to migrate to another country

Notice that the answers to each of the above questions will affect the amount of funds required to support the client after his retirement.Quantitative Assumptions

Quantitative assumptions are just as important and no easy to make. It is thus important that you understand their impact on the financial plan as your client may need your advice. The common quantitative assumptions include:

• inflation rate
• investment rate of return
• income tax rate
• replacement ratio percentage
• expected retirement age
• years to retirement
• life expectancy

Inflation Rate

Inflation erodes the client’s purchasing power. As such, under-estimating the inflation rate will result in the client being unable to maintain economic self-sufficiency during retirement. In retirement planning, you must understand the impact of inflation on your financial plan, for example using a 4% inflation rate and compare to a 6% inflation rate, the amount of funds needed for retiremement can actually increases by 20%.

Investment Rate Of Return

As with inflation rate, hisotrical data should be used to estimate the annualised investment rate of return. Inflation-adjusted returns should be used and depending on the tax aspects, either before tax or after tax rates of return should be used. Therefore, you have to estimate different rates for the different asset classes. You may use an average rate for the various classes of assets if it alright with your client.

Income Tax Rate 

Tax rates are subject to revision. Since it is impossible to predict what the tax rates will be in the future, one solution is to use your current year effective rate for both the pre-retirement and retirement years. As chargeable income is likely to decrease after one’s retirement, such a funding method will over-state the tax impact and thus provide a cushion for the you.  Alternative, you may base on the before-tax inflation adjusted returns.

The Replacement Ration Percentage 

The replacement ratio percentage is used to determine how much my client will require on the first year of retirement. The usual estimate used is 70%  (80-85% for lower income) on their last drawn pay.

Expected Retirement Age 

As the current statutory retirement age is 65, most people will think that they will contiune to work until they reach the official retirement age. However, circumstances may force them to retire early. For example, if my client with poor health may decide to retire earlier and this will disrupt the financial plan as the accumulation period for building up the fund for retirement is shortened.

Years To Retirement

This period is derived by subtracting your current age from the desired retirement age. It is the period during which the you could accumulate the necessary funds for your retirement.

 Life Expectancy

According to the Ministry of Health’s Statistics, the life expectancy for a male is 78 years whilst that for a female is 80 years. As a rule of thumb, I wyould add another 8 years to them. Thus a man is presumed to live to age 86 whilst a woman is presumed to live to age 88, using this age to minus the desired retirement age will give the number of years that a person will live after he have retired.

For my clients who have poor family histories, I will base on their parents, grandparents, aunt and uncles’ age death to determine how long my client will live after their retirement. This is because medical studies have shown a strong correlation between genetics and life expectancy.

If you are doing your own retirement planning, please take note of these assumptions as a slight change in it will affect the accuracy of your retirement planning. If you will like us to assist you in your retirement planning, feel free to contact us and arrange for an appointment. E-Mail myself at jack@investmentsg.com

Good Luck!

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Get Corporate Travel Insurance For Your Employees

AIG Corporate Assist-Enhanced lets you travel the world in complete freedom, knowing you have comprehensive protection - whether occasional business travelers or corporate globe-trotters, you can choose your plan from the widest range of benefits and services.

What’s New

* Maximum length of each business trip increased to 120 days
* Covers personal deviation immediately before and after a business trip up to 45 days
* Covers age up to 80 years
* Automatic Extension of coverage period of up to 30 days due to Hospitalisation / Quarantine
* Home Leave Extension of up to 14 days for expatriates
* Full Terrorism Coverage
* Option for leisure travel

Countries Grouping

Regional - Australia, Bangladesh, Brunei, Cambodia, China, Hong Kong, India, Indonesia, Japan, Korea, Laos, Macau, Malaysia, Myanmar, New Zealand, Pakistan, Philippines, Sri Lanka, Taiwan, Thailand and Vietnam.

International - All other countries not listed as Regional

Basic Coverage Include:

1. Medical & Accidental Dental Expenses Incurred Overseas
   Covers overseas medical expenses incurred as a result of accident or sickness whilst traveling
2. Return Treatment
   Covers medical expenses incurred for treatment or follow-up treatment in Singapore or place of regular employment up to 45 days
3. Treatment by Traditional Chinese Medicine (TCM)
   Covers Traditional Chinese Medicine expenses incurred whilst overseas and follow-up treatment in Singapore or place of regular employment
4. Hospital Confinement Benefit
   Pays S$200 for every complete day the Insured Person is hospitalised overseas
5. Double Hospital Confinement Benefit in ICU
   Pays S$400 for every complete day the Insured Person is hospitalised overseas in an Intensive Care Unit
6. Hospital Visitation
   Pays incidental expenses for the visit of up to two friends or relatives if the Insured Person requires hospitalisation for more than 5 days whilst overseas
7. Emergency Telephone Charges
   Reimbursement of mobile telephone charges for medical related services in contacting American International Assistance Services (AIAS)
8. Emergency Medical Evacuation
   Covers all American International Assistance Services (AIAS) Emergency Medical Evacuation expenses
9. Repatriation Expenses
   Covers all AIAS expenses incurred in returning the mortal remains of the Insured Person, to Singapore
10. Direct Repatriation Expenses
    Covers all AIAS expenses incurred in returning the mortal remains of the Insured Person, to his/her home country
11. Compassionate Visit
    Pays for the incidental expenses of sending two relatives or friends if assistance is required to assist in repatriation arrangements of the Insured Person’s mortal remains
12. Accidental Death & Permanent Disablement
    Covers the Insured Person in the event of Accidental Death and Disablement
13. Accidental Burns Benefit
    Covers the Insured Person for serious burns in the event of an accident
14. Fracture Benefit
    Pays for fractures suffered in an accident
15. Compassionate Death Allowance
    Pays a lump sum allowance in the event the Insured Person suffers a loss of life due to an accident
16. Child Education Fund
    Pays a lump sum education fund in the event the Insured Person suffers a loss of life due to an accident
17. Trip Cancellation Expenses
    Covers loss of irredeemable travel and accommodation expenses paid in advance and occurring up to 30 days prior to departure
18. Trip Curtailment Expenses
    Covers additional travel or accommodation expenses incurred or forfeited after the commencement of the Trip
19. Travel Delay
    Pays S$200 for each 6 full consecutive hours of delay whilst overseas or in Singapore
20. Travel Misconnection
    Covers expenses incurred as a result of misconnection scheduled conveyance for at least 6 consecutive hours
21. Baggage Delay
    Pays S$200 for each full 6 consecutive hours that the Insured Person’s baggage is delayed whilst overseas or upon arrival in Singapore
22. Damage or Loss of Personal Baggage
    Covers loss or damage to baggage, clothing, personal effects & golfing equipment
    (Max. S$1000 for any one article or pair or set of article)
23.  Damage or Loss of Personal Portable Business Equipment
    Covers loss or damage to Mobile phones, Laptop Computers, Personal Digital
    Assistants (PDAs) (Max. S$1000 for any one article or pair or set of article)
24. Loss of Travel Documents & Money including Credit Card Fraud
    Pays the Insured Person’s travel and hotel expenses including cost of obtaining replacement passports, travel tickets and other relevant travel documents
25. Hijack
    Pays S$500 for each complete day the Insured Person is delayed due to an act of hijacking
26. Staff Replacement Benefits
    Pays the cost of sending out a replacement employee to continue the business for the original Insured Person, in the event the Insured Person is unable to continue his/her business due to a disability
27. Credit Card Indemnity
    Pays the outstanding credit bill incurred during the trip in the event the Insured Person dies during a trip
28. Legal Fees
    Pays the legal costs and expenses incurred as a result of dealing with claims for compensation against a third party causing the Insured Person’s Accidental Death or Permanent Disablement during the Overseas Trip.
29. Bail Bond Facility
    Provides assistance in arranging a bail bond if the Insured person is arrested following a road accident during a trip
30. Personal Liability
    Covers the Insured Person against liability to third parties for accidental death or injury or accidental loss or damage to their property caused by his/her negligence
31. Extended to cover you against Death or Injury as a result of :-
    (1) Strike, Riot, Civil Commotion and Terrorism (2) Hijack, Murder and Assault (3) Drowning and Suffocation (4) Exposure and Disapperance (5) Motor-Cycling (6) Unschedule Flight (7) Accidental Miscarriage
32. (1) Automatic Extension of coverage period of up to 30 days due to Hospitalisation/Quarantine
    (2) Home Leave Extension of up to 14 days for expatriates

These coverages are great benefit for your employee who fly for your company, they deserve to be protected. Furthermore, by giving them these benefit it will save your company lots of money if any unfortunate incident happened, think twice!

Premium rate are as cheap as $170 to $380 per annual which is just 0.47 cent per day! If your employee don’t travel as often, you can also go for the AD-HOC premium ranging from $25- $160 per trips only. As a senior consultant, I strongly recommend  your company to go for annual premium which is so much cheaper, and received 365 24/7 coverage without any worries.

For further enquiry, please contact us @ (65) 91059260 or complete and submit the enquiry form so that we can propose a suitable travel insurance plan for your company.  Email jack@investmentsg.com

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Just came back from NTUC Kick Start & product launch seminar for all independent IFA at Vivo City. The event was held in Vivo City Golden Village Grand Cinema which can host 700 financial advisers from varies financial advisory institution.

In the opening address, Mr Tan Suee Chieh the Chief Executive of NUTC address the large crowd and also presented the Corpoate results and FA results for year 2007. After taking over the appointment, Mr Tan has done massive make over to the entire organization from management to front line stuffs, customer services department, introducing new range to ground breaking products like REVO Save, an endownment saving plan, which was launch last year. Indeed under his great leadership he has successful not only bring NTUC back on track but also make revolution changes so that they achieve groundbreaking result in this year 2008.

An an senior financial consultant, I witness the changes in NTUC since Mr Tan Suee Chieh took over as CEO.  From better customer supports to new excellent new products.

Today NTUC is proud to announce their first new product of the year, promising another 3 different more throughout the entire 2008.

Vivolife- Live Life to the fullest!

This is an whole life protection plan. The policy covers death and 30 critical illness for the entire lifetime and Total and Permanent Disability TPD before age 65.These are just the common features any whole life plan will have. Being a limited whole life plan. you don’t need to pay the premium for life as you can select a fixed premium term of 10,15,20,25 years, up to age 64 at last birthday or up to age 84 at last birthday.

If you have done your homework, you should know the above features are no big deal. The big deal about the plan come here.

Vivolife by NTUC is giving away 3x accidental death benefit which you can’t find in any plan in the market except UOB Maxi Life 2 which have 2x accidental death benefit. So what is 3X accidental death, if your basic sum assured is $100,000. If accidental death occurs, NTUC will pay you $300,000  plus all accumulated bonuses.

Not only this, Vivolife NTUC also is giving this Retrenchment Wavier  feature to all policy holder. If you are retrench by your company and go out of jobs, Vivolife will wavie your premium for 6 months. This benefit is the first in the market and you cannot find it anywhere. If you are worried about going out of job 1 day and cannot afford the premium, this is one feature that might interest you.

Lastly, NTUC also allow you to use your accumulated cash and turn it into an retirement aunnity with extra 5% bonus. Which mean, NTUC will lower your sum assured to your original sum assure and activate an retirement payment to you. Currently only UOB Life Maxi has similar feature.

So summary the new feature in Vivolife

1. Retirement Wavier
2. Triple Accidental Death Benefit
3. Annuity Option

With these new features, will Vivolife be one of the best wholelife insurance for year 2008, I guess most likely it will be as their cheap premium rates are rather hard for competitor to match and with the additional revolution new features, it is even harder now.

Launch date17 January 2008

Promotion by NUTC

With monthly premium of $250 NTUC will be giving you $100 Shopping voucher

With Monthly Premium of $400 NTUC will be giving you $250 Shopping Voucher

With Annual Premium of $5000 NUTC will be giving you $4000 Shopping Voucher

Shopping Voucher can be either FairPrice or CapitalMall Vouchers. Combination of vouchers are not allowed.

With the above promotion NTUC is giving away, VivoLife is your choice if you are looking for protection plan or whole life plan.

I will be presenting more example with figures in my later post.

If you want a quotation for Vivolife, feel free to contact me at 9105 9260 Jack or email me at jack@investments.com or use the contact us.  Additional voucher for any Vivolife purchase from us. Get Your FREE Quote Now!

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Tips on Investing Your CPF Monies From CPF Board Website

Get fast cash, high returns with CPF savings tricks?

DO NOT INVEST BASED ON PROMISES OF QUICK AND ATTRACTIVE RETURNS ALONE

You may have heard of offers of quick and attractive returns when you invest your CPF savings. Be careful not to invest your CPF savings based on such promises alone.

Think long term. Your CPF savings are for your old age needs. You should thus invest your CPF with a view to growing your nest egg instead of taking risky decisions to earn a quick profit or receive gifts. This article provides some tips that you should note before you invest your CPF savings.

TIP 1: Always consider the risks

Do not be attracted to headline rates alone. All investments come with risk. If a product offers a high potential return, chances are that it would also be accompanied with high risks. This is true even for financial products included in the CPF Investment Scheme (CPFIS). There is no guarantee that any product will always be profitable.

Always ask what the risks are. Know how much investment risk you can afford to take. Make sure you choose investments that you are comfortable with and are suitable for your long-term goals.

TIP 2: Weigh the expected returns against the risk-free returns offered by CPF

The diagram below provides a summary of the interest rates paid by CPF Board. If you are not confident that your investment can earn more than the returns offered by CPF Board, it is better to leave your money in your CPF account and earn risk-free interest rates.

TIP 3: Find out how the product works

There are many different types of investment products in the market. Always find out how the product works before you decide whether to invest your CPF savings.

Here are a few key areas you should find out.
i. How does the investment product work? What does the product invest in?
ii. What are the risks? Can you tolerate these risks? As a general rule, the shorter your investment time horizon, the less investment risk you should take.
iii. What are the costs? Over the long term, high expenses can drag down the profits gained from investing in even the better-performing investments.
iv. How much do you have to invest? Consider how taking up the investment could affect your CPF balance that you need for other purposes such as financing your housing loan payments.
v. How long do you have to stay invested? What happens if you decide to terminate your investment earlier? Note that charges may be imposed or you may lose some of your earlier investments if you terminate an investment prematurely.

Do not invest in any product that you do not understand or are not comfortable with.

TIP 4: Before switching investments, check if the switch would benefit you

If you have already invested your CPF savings, you may be asked to consider switching your investment from one fund to another; or from one product to another.

Always find out how the recommended switch would benefit you, even if the recommendation is from someone that you know very well or hold in high regard.

Here are a few key questions you should ask:
i. What is the purpose of the switch?
ii. Would the switch give me better returns than the current product or interest currently paid by CPF?
iii. What are the potential disadvantages associated with the switch?
iv. Am I entitled to any free switching options? If not, how much the switch would cost? Note that you may be charged a switching fee or incur fresh front-end charges.

TIP 5: Do not invest or switch based on offers of gifts and cash rebates

Even if you are offered gifts /rebates for investing under CPFIS, bear in mind that these must be converted to cash or bonus units which must be refunded back to your account.

Consumers who receive cash rebates for any investment under the CPF Investment Scheme should lodge a report with CPF Board immediately. CPF Board will then arrange for the cash rebate to be credited back to the consumer’s CPF account. Members or intermediaries found to have siphoned out CPF monies through the offering/receiving of cash rebates could face legal action by CPF Board.

TIP 6: Diversify your investments and review them regularly

If you do decide to invest your CPF savings, consider spreading your investments among asset classes (e.g. stocks, bonds and cash equivalents) and among different products within each asset class. Don’t put all your eggs into one basket!

Do also review your investments regularly. Do this at least once a year to take stock of the investment performance, consider whether you are on track towards achieving your investment objectives, and adjust your investment portfolio according to your needs.

TIP 7: Keep your NRIC No. and SingPass confidential

You should keep your NRIC No. and SingPass confidential at all times and not disclose them to anyone. Otherwise, there is a risk that someone could authorise transactions for your CPF monies without your knowledge and/or approval.

In summary, invest your CPF monies prudently. Consider the suitability of the products according to your individual risk appetite and investment objectives. Do not invest based on promotional gifts and rebates.

If you are not confident in investing on your own, it is better to leave your money in your CPF account and earn risk-free interest rates.

For Independent advise on how to maximize your CPF investment from Senior Financial Consultant and not Insurance Agents, Bankers or Broker. Call Jack Lan 9105 9260 for appointment! With Great Track Records and Testimonials!

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Alert from CPFB-Get fast cash, high returns with CPF savings?

Dear Sir/Madam,

Be careful! Do not invest based on promises of quick and attractive returns alone.

You are advised to ignore advertisements which tout conversion of CPF into cash. You should invest prudently and consider the suitability of the products according to your own risk appetite and investment objectives. Investments should not be made based on promotional gifts and rebates. Click here to get some tips before investing your CPF savings.

Yours faithfully

CPF Board

Received this e-mail from CPFB, guess recently there must be lots of complain from Singaporean about CPF investment. If you read through the newspaper, especially The New Paper, you will be able to see lots of advertisement about “Getting fast cash using CPF or Invest you CPF to get Cash” etc. These advertisement are put up by Insurance Agents who wanted to get as many CPF cases as possible before April 2008 when government will hold on all Singaporeans first $60,000 monies from CPFIS. Such acts is terrible and especially people who engage them just for the miserable 1-2 percent cash rebate.

Yes, you might get some cash rebates from such agents but what are your potential loses, your CPF monies are for retirement. Given 2 different case,1) investing with a experience financial consultant who didn’t give you any rebates but 10 years later help you increase your CPF retirement funds by 10-15% or 2)you rather get the miserable few hundreds rebates now from these irresponsible agents and end of the days lost your CPF monies due to bad investment portfolio, which do you want?

Many of my clients who had previously bought CPF investment from insurance agents or bank all have bad experiences, honestly I haven’t got some positive feedback yet. I guess we cannot blame them too since they are just train to sell what are have in their shelves and not to place clients benefits at the front. If they don’t sell, they can’t get their salaries and commission, is not their fault? How to solve this? Educate the public and restructure the front end sales force in financial products. I believe the government is putting effort in this already but it take times. Independent advisory firm should be your choice, of course there are always still bad sheep in every industries, every occupations but at least they have the extra options where banks and insurance agents don’t at all.

Writing a bit off topic but anyway do not invest your CPF just because of cash rebate and free gifts which are illegal anyway if you don’t know. You can report these agents to MAS and he/she will be out of job very soon. Be wise, be alert and think long term especially CPF investment, you don’t want your retirement funds to go down the drain because of 1-2% cash rebates or a free handphone.

If you need advise about CPF investment do contact me at 9105 9260 Jack Lan Senior Financial Consultant , AFC (Independent Advisory Firm)!

Subscribe Here!| Posted in CPF Central Provident Fund Board, CPF Investment, Investment, Ordinary Account, Retirement Account, Retirement Planning, Special Account, Supplementary Retirement Scheme | 1 Comment > Add Yours » |