Endowment policy has been in the market for a very long time. However, long term endowment has only started to surface recently in the market with policy maturing at age 100  or even 120/125.

Plans like Prudential Pruwealth, Manulife ReadyBuilder, Etiqa Amplify Flex, Aviva MyLifeSavingsPlan, NTUC RevoGift and AIA Smart Wealth Builder. 

A lot of people thinks that Prudential/AIA or other renowned insurance company’s endowment plans are quite decent because their capital is secured and guaranteed, but truth to be told consumers who get policies from an insurance agent or non-independent financial advisor will/may never get the chance to compare due to the agent’s limitations and knowledge of what is out there in the market. 

(Check out my other article on independent and non-independent advisors)

So here is it…… Below example is a 27 year old individual sample.

So the above table shows the guaranteed value at age 60 or 61.

Now, let’s look at age 100/101 of primary life insured, what is the guaranteed cash value?

Let’s see……

This is Pruwealth II @ age 100, guaranteed whatever you have paid to date. Good enough? Hmmm

Next, AIA Smart Wealth Builder, guaranteed $162,000 @ age 101. Better?

Next, Manulife ReadyBuilder, guaranteed $267,044 @ age 100. Or maybe this is better?

Lastly, Etiqa Amplify Flex, guaranteed $279,225 @ age 100. Or maybe this is even better?

So, for people/consumers out there who think that they have the best plan in the market, think twice, think thrice. Different plans have different pros and cons, good and bad. However, are you getting the most suitable plan for yourself? or is it just because the plan that you got is the only plan your insurance agent can offer? 

For more enquiries on plan comparison and enquiries, click/scan here to talk to us directly.

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– Jun Kai & Grace –

Managed Account

What is managed account?

Managed portfolio of funds, which means you delegate the day to day portfolio re-balancing and implementation decisions to an Asset Manager, once you have selected the investment strategy that suits you. Diversified across multiple fund houses, multiple asset classes, and over hundreds of different securities. No single security will have an outsized impact on your portfolio. There are various strategies you can choose from, depending on your investing needs.

Benefits of using Managed Account?

Simplicity

The only decisions you will have to make is the choice of the specific managed account that your Financial Advisor may present to you as part of an overall financial plan, and how much you wish to invest. The simplicity of managed account leaves you and your Financial Advisor with the time and clarity of mind to focus your discussion on the things that matter- your long term financial goals and aspirations.

Professional Management

Offers you direct access to an Asset Manager, a service usually reserved for institutional investors. 

Timeliness

Investment recommendations are perishable goods. Untimely decision making can impede your progress to reaching your financial goals. This is the principle benefit of managed account. 

Professional portfolio managers will monitor the market, so you do not have to do so. Your portfolio will be managed and re-balanced for you with the timeliness necessary to safeguard your long term financial interests. Managed account addresses a common limitation of Advisory Wrap portfolios, which requires that you approve each trade action recommended by your Financial Advisor. If this requirement encumbers your lifestyle or challenges your investment knowledge, managed account investment is for you.

Transparency

Most managed accounts platforms offer real time access to your managed account portfolio so you and your Financial Advisor can have access to it anytime, anywhere. You will also receive trade confirmations each time a trade is executed in your portfolio. managed account is designed to be transparent to facilitate a holistic and ongoing dialogue between you and your advisor. It will also equip your Financial Advisor to help you monitor your progress towards your desired financial objectives, and if necessary, recommend any recalibration of your overall asset allocation to keep you on track towards meeting your goals.

Therefore…

These are some of the advantages of doing investments through managed account especially if you do not want the hassle to always keep watch over the stock market personally and always have the fear of not being able to re-balance/buy in/withdraw your investment in time. Then managed account is the right solution for you! 

Patients must bear a minimum 5 per cent co-payment for new Integrated Shield Plan riders, Senior Minister of State for Health Chee Hong Tat announced on Wednesday (Mar 7).

The changes in requirements will affect those who will pay for what is known as “full riders”, on top of Integrated Shield Plans. Such riders cover the entire co-payment amount, so the policyholder ends up paying nothing regardless of the bill size. 

Currently, about 29 per cent of Singapore residents have these full riders.

In spite of the changes announced, insurers in Singapore must continue to honour commercial contracts that they already have with existing policyholders. The new changes only affect new riders, and not existing ones.

If you have been approached by an overly enthusiastic insurance agent hoping to capitalise on the announcement to generate sales lead for themself, do take note of this. The changes do not affect your existing policies in any way. Also, nothing in the announcement requires you to act immediately.

To give insurers time to design the new co-payment rider, IP plans that offer full riders will be available for now.

However, policyholders who buy an IP plan with full rider will eventually have to switch (by 1 April 2021) to the new rider with co-payment.

This only applies to new IP plans with full rider that were bought after the announcement has been made. If you already have an existing IP plan with full rider, this does not apply to you.

Things to note:

 If you already have an integrated shield plan with full rider, you will continue to enjoy this coverage. You will not be forced to switch to any new plans. Do note however that you should expect your premiums to continue increasing in the future, since the policyholders who are most likely to claim on their hospital plans will also be the ones least likely to switch.

 If you have an integrated shield plan that includes a co-payment rider, you will not be affected.

If for any reasons you are switching your plan, be careful to ensure that you do not lose any coverage due to pre-existing conditions.

Pros and Cons of doing your own Will for free.

You may think that ahhhhaaa, why waste my time and money to engage a professional Will writer when I can just do it myself either by writing in a free Will template form found online or I can use services provided for free e.g OCBC Will generator. So here’s why:

The most obvious advantages of making a last will via a do it yourself will kit are time and money—at least in the present. Creating a last will online can cost less than getting an attorney involved in the will-writing process, and an online will service can allow a person to make a will in mere minutes.

Those who can benefit most from DIY wills are people with a relatively small estate (a value that doesn’t reach the level of being subject to estate taxes) and no minor children.

But for the Cons:

Even the pros listed above could have potential cons attached in the future, however. The money you save now as you create a last will online could end up costing your estate and/or your heirs money later if the will isn’t valid or its validity ends up being contested because it wasn’t written well enough to withstand objections.

And the same goes for time. Probating your estate—and distributing assets to your heirs—could end up taking a lot longer than it has to if the will wasn’t executed properly or otherwise has problems that must be resolved by the probate court.

Remember that state laws regarding will execution vary greatly, and some DIY will sites may not take that into consideration when preparing your last will. Some jurisdictions, for example, require a certain number of witnesses present at the will’s signing and/or the seal of a notary public.

DIY wills can also fail to take into account specific estate planning needs such as avoiding potential estate taxes, and may not fully contemplate the needs of minor children, if you have any. Blended families or those with children from a previous relationship may also find that DIY will forms do not adequately cover your concerns.

So before going straight to using DIY Will generator thinking that people must be stupid enough to pay money to get it done when I can just do it for free, what a genius am I. Think twice, you may be at the losing end at the end of the day, or should I say, your family will be at the losing end after you are gone.

Hospitalisation premiums have been increasing over the years due to the rising healthcare cost. Unknowingly the premiums have rose to very high amounts and if no one were to add it all up no one will know how much eventually are people paying in total.

Below i will show you a table showing the revised premiums on different IP plans in Singapore.

After adding up all the premiums paid from age 65 (retirement age) till age 88 (approx average life expectancy). The total premiums that is paid within this 20 over years is added up to approximately a whopping amount of up to $230,000!!

Do take note that for our CPF basic retirement sum is now at $88,000, Full Retirement Sum is at $176,000 and Enhanced Retirement Sum is now at only $264,000. Which means that anyone who have even save up till the Enhanced retirement sum, deducting all the premiums that they have to pay for their IP plans with riders, they will only be left with $44,000.

Below are the revised IP plan pricing table for your reference:

So do you think you have really saved up enough for your retirement or just so you thought? Contact us now to help you walk the retirement journey with you.

It is always good to plan your estate distribution to prevent any conflicts in the family after you have risen up to heaven. Will writing is one of the ways to help you better plan your estate. Here are some misconceptions and myths on Will writing.

Myth 1. My spouse will automatically get everything when I die if I don’t have a will?

True only if your parents are deceased and you have no children. Otherwise false as it depends on who survives so that if you do not have a will, your estate will be divided between your surviving spouse and your children or parents.

Myth 2. I must have a will or the government will take everything when I die?

False. If you die without a Will, but you have a next-of-kin surviving you then they will be your beneficiaries under the Intestate Succession Act. The Government will take only in rare cases where there are no next-of-kin.

Myth 3. I’m not married but have children, my children will get a share even if there I have no will?

False. Singapore law does not entitle illegitimate children from receiving a share if there is no Will. Section 10(1) of the Legitimacy Act expressly provides that upon the death of a mother without a will, an illegitimate child of hers would only be entitled to succeed to her property if she does not leave behind a legitimate child.

Myth 4. I have step-children. Without a Will, only my children will get a share and my step-children will not?

True. Under Singapore law, only legal or biological children have an entitlement. Without adoption or a Will, your step-children will not get a share.

Myth 5. When I die, a lawyer needs to read my will to my family?

False. This myth comes from Hollywood dramas. It is very rare for a lawyer do this. What commonly happens is the lawyer instructed by the executor will do all the court paperwork. The family and other beneficiaries usually read the will themselves.

Myth 6. The government taxes the assets of the estate?

True only if the date of death was before 15 February 2008. After that, no estate tax is payable in Singapore.

Myth 7. A Will should be kept in a safe place like a bank safe deposit or a safe at home?

The important thing about keeping your will is that your Executor should have ready access to it. Placing your will in a safe deposit will prevent your Executor from having access to the Will as the bank will not allow the contents of the safe deposit to be withdrawn upon the account holders death. The risk taken with placing a will in a home safe is that your Executor may not remember the access codes, especially after many years.

Myth 8. The Executor in my will can help me make an important decision if I lose mental capacity?

False. A will only come into effect upon the death of the maker of the will. If you want to appoint someone to make decisions on your behalf you must do a Lasting Power of Attorney.

In Singapore, one out of ten people is a millionaire. But how many of them actually do financial planning?

According to survey results from Today newspaper, one in three working Singaporeans have not done financial planning for their future. Many of them are still living paycheck to paycheck without any proper financial planning.

A lot of Singaporeans only think about their finance only when they need it,  for example when they are going to have children, marriage or even only when they are going to retire. However till then everything is a bit too late.

Here are some reasons why financial planning is critical for your future and you should start young/early:

1) It helps you manage your income more effectively through financial planning. Helps you understand your monthly or yearly expenses and how much to save up for it.

2) Increases your cash flow by planning and controlling your expenses carefully.

3) Gives your family protection and security in terms of financially and also in terms of insurance coverage.

4) Help you understand what and which investments is suitable to help you attain your financial goals in the future, be it buying a car or owning a property. Making your money work harder for you rather than idling in the bank.

5) Proper financial planning will be beneficial in difficult times and allow you to sustain a certain standard of living in the event of any economic downturn.

6) Savings in terms of high liquidity investments that is able to allow you to use it on rainy days. Plan early and enjoy worry-free financial freedom in the future. So what are you waiting for?

Contact your financial adviser now to navigate your financial future.

Financial Alliance, an independent financial advisory firm that provides unbiased and partial advise to help our clients attain financial goals and freedom. Putting our client interest as the first priority, our advisor representatives will not be influence by other external factors which will cause us to give biased advise.  

Independent financial advisory consultant are professionals who offer independent advice on financial matters to their clients and recommend suitable financial products from the marketavailable. 

The term “Independent Financial Adviser” was coined to describe the advisers working and representing independently for their clients rather than representing an insurance company or bank.

Typically an Independent Financial Advisory Consultant will conduct a detailed survey of a client’s financial position, preferences and objectives; this is sometimes known as a ‘fact-find’. The adviser will then recommend appropriate action to meet the client’s objectives; and if necessary recommend a suitable financial product to match the client’s needs.

To help you better understand the different types of advisers in the market, let me explain to you the different types of financial advisers in Singapore. 

Types of “financial advisers” in Singapore?

Tied agents

Agents from insurance company can only sell their own company products and they have a responsibility to act in the best interest of the insurance company that they represent. They will also be the most common agents you will encounter out there. Also… They are unable to sell insurance from other companies. That means if you want to purchase products from other insurance providers, you’d need to engage another tied agent from a different company. Advise given will also be biased towards their own company’s products as they can only sell product/policies from one provider. (E.g: AIA, AXA, Prudential, Great Eastern, Aviva etc)

Financial Advisory Firms by Insurance companies

Insurance companies such as Aviva, Great Eastern, AIA and others have started their own financial advisory companies. (E.g AvivaFA, Great Eastern FA, Qiren by AIA and more) All these FA company is mainly owned by insurance companies so advice given may not be neutral and balance.

Personal Banker

Personal bankers are appointed representative of a bank. They can advise/sell you on products that are only offered by their bank as well as life insurance products from companies that their bank has agreed to distribute from. Which of course advise will be skewed towards their partnership companies due to limited products that they can offer. E.g A personal banker from DBS will be able to advise/sell you products from DBS and Manulife, since Manulife have an existing partnership with DBS.

Independent Financial Advisory Representatives

Independent financial advisory representatives are allowed to advise/sell you products from a wide array of products and services. It is a professional occupation similar to doctors and lawyers. IFA representatives also have the duty to act in the best interest of their clients which they represent.

IFA firms are called independent because they have to be able to advise/sell you products from at least four or more life insurance companies as according to the regulation of MAS (Monetary Authority of Singapore).

Recommendations are to be independent, and they are not allowed by MAS to be influenced by the insurance provider companies, where independent financial advisers have to be neutral, acting in the best interest of their clients and provide unbiased advice that best suits the clients needs will be their utmost priority. Instead of representing any insurance companies, IFA representatives represents the client to get the best suitable products from the insurance/investment companies.

So what is your choice? Which type of financial adviser consultant would you want to engage? Bias or neutral? One or multiple product providers to choose from?  An adviser who just want to do a transaction business or an adviser that will walk the financial journey with you? Make the right choice and you will surely be able to attain your financial goals and financial freedom in no time!!