Savings Plan/ Insurance first?

[FP_IFA]

I would personally encourage coverage first. The ship needs lifeboats before embarking.

 

[Micky Neo]

Yea, Vote protection first.

For saving plans, check out with FA rep, they can provide a wider range of comparision for you. Think the popular ones are Income, TM Life, HSBC.

 

[p4zl23]

Generally, separating insurance and savings/investments is a good tip to follow. Another good rule of thumb is to stay away from tied agents (agents representing single companies), non-independent financial advisers who sometimes misrepresent that they are Independent, and banks.

Tied agents can only provide products and solutions their company offers, which either means a portfolio with missing essential coverage and/or overpriced policies. Non-independent financial advisers and banks have special arrangements with insurance companies to sell certain products over others.

Independent Financial Advisers (IFA) minimise the clash of interests the most. Of course, due diligence and prudence still have to be taken in choosing an IFA for your own benefit.

I dont believe in "independent" FA. Do you get paid commission? If yes, does the different products have varying commission? The question is how "independent" it is when there are still different remunueration?

 

[rarenick]

Protection comes first. But dont overspend on insurance.

 

[Cashcow]

I dont believe in "independent" FA. Do you get paid commission? If yes, does the different products have varying commission? The question is how "independent" it is when there are still different remunueration?

To me, providend is the best cos they don't take commission. All the so-called IFA is bullsh*t as most of the time, they don't show clients 10 or more plans for comparisons. Who knows, maybe the plan they sell you is the one with the highest commission.

Then, they see ghost say ghost word, see human say human words. For eg, if they see client got company P plan, they will badmouth company P plan and say another plan from company G is good. Then for another client with company G plan, they will badmouth it and say company P plan is good. A lot of hypocrites one, maybe only 1 good in 1000 IFA.

 

[Dividends Warrior]

Insurance first.

Actually, saving is an ongoing process. It should be happening all the time.

Then lastly, investing.

 

[HandsTied]

I dont believe in "independent" FA. Do you get paid commission? If yes, does the different products have varying commission? The question is how "independent" it is when there are still different remunueration?

That's an excellent question. In fact, many FA firms are actually not truly independent and do not adhere to MAS guideline for Independence. According to this guideline, an IFA can only be called Independent if the difference in remuneration within product classes within similar levels, i.e. there can be different remuneration but the difference cannot be significant.

Thus, you can have non-independent FA firms who cut deals with product providers to sell a particular product for extra commission. Independent Financial Advisers have decidedly followed a stricter set of regulation by its own choice to provide better advice for clients.

In the end, it boils down to a person's ethics and competency. Someone who is ethical and competent will be able to benefit his clients with true independent advice. So, I fully agree with what Rommie said in his newbie guide - "All good advisers are IFAs, but not all IFAs are good advisers."

There exist two major clashes of interests between a commission-based relationship between adviser and clients. One is the range of products the adviser can transact to earn a commission, and the other is the commissions he receive. An IFA reduces the first clash of interests greatly.

Of course, commissions remain a clash of interest between an adviser and his clients even with IFAs. One must also remember that "clash of interest" can work both ways. I am earning a low remuneration because I decide to sell good products to my clients. A client who wants to reduce this clash of interest can pay fees for advice instead of commissions. I have very decidedly and purposefully joined the team of my mentor who is a fee-based planner to reduce the clash of interests with regards to commissions.

 

[lonewalker]

Hi guys,

I've recently stepped into the working world, and thinking of getting either one of the above-mentioned. Which one do you guys think is the one that a mid-20s guy should get first? Insurance for its lower premium, or savings plan?

With regards to savings plan, anyone here has any? Which company's savings plans are considered the best in your opinion? I've talked to Prudential and HSBC advisers; and the difference that I garner from that is that HSBC offers the full guaranteed amount of your amount saved (100%) but with a lower projected yield at maturity. Prudential, on the other hand, only offers 60% guaranteed returns on your savings, but has a higher 'projected' maturity yield, but subject to economy performance etc...

Any opinions or differences that any of you bros know of?

Cheers!
A guy trying to plan for his financial future

Hi, some basic answers to your questions.

1) 1st Step in Financial Planning is actually a positive cash flow. I.E your income must be > than your expenses. Learn to live within means and have a good saving habit.

2) Manage your risk, I.E insurance to cover hospitalisation which you can use your Medisave. Than also at the same time, risk management should a major event happens to you resulting in loss of ability to earn income, i.e disability or critical illness. If you have dependents, death protection to give them the continued life style.

3) Save lots of CASH. have 3-6 months of liquidity based on your 3-6months expenses.

4) Once you built up your cash, surplus you can consider buying assets like stocks, properties, bonds. However, tons of research and homework is required (no lazy way to financial freedom).

As for savings plan, if you are not into investing on your own and prefer a traditional endowment plans (savings plan), I think you should get one after your risk is managed.
Some folks are more suitable for savings than investing as their risk tolerance is lower. But some folks prefer to DIY and Buy term and invest the rest.

So you got to see which ones you prefer and understands the pros and cons from either ways.

I do have savings plans from my company and if you want, I can give you a quote for comparision. But in my opinion, it is better to discuss your priorities on you since you just started out and it's better to start with some important financial products instead of just savings plans alone (unless you are dead sure you wanted).

 

[Insurance Broker]

That's an excellent question. In fact, many FA firms are actually not truly independent and do not adhere to MAS guideline for Independence. According to this guideline, an IFA can only be called Independent if the difference in remuneration within product classes within similar levels, i.e. there can be different remuneration but the difference cannot be significant.

Thus, you can have non-independent FA firms who cut deals with product providers to sell a particular product for extra commission. Independent Financial Advisers have decidedly followed a stricter set of regulation by its own choice to provide better advice for clients.

In the end, it boils down to a person's ethics and competency. Someone who is ethical and competent will be able to benefit his clients with true independent advice. So, I fully agree with what Rommie said in his newbie guide - "All good advisers are IFAs, but not all IFAs are good advisers."

There exist two major clashes of interests between a commission-based relationship between adviser and clients. One is the range of products the adviser can transact to earn a commission, and the other is the commissions he receive. An IFA reduces the first clash of interests greatly.

Of course, commissions remain a clash of interest between an adviser and his clients even with IFAs. One must also remember that "clash of interest" can work both ways. I am earning a low remuneration because I decide to sell good products to my clients. A client who wants to reduce this clash of interest can pay fees for advice instead of commissions. I have very decidedly and purposefully joined the team of my mentor who is a fee-based planner to reduce the clash of interests with regards to commissions.

I don't understand why you mentioned that some FA are "non-independent" and yours is "independent". You tends to put down others to make yourself superior.

How much fee based advisory service have you provided... So after the fee based advice, you earn another revenue through the product commission?

There isn't any FA firms that cut deals with firms to purposely promote their products. It is offer to all FA firms with the same remuneration.

Just that different insurance companies pay to FA firms differently. Some inethical FA will try to sell the higher commission products.

Therefore it is important to educate yourself through the forums to understand what options are available instead of blindly believing in your advisors!

 

[Insurance Broker]

To me, providend is the best cos they don't take commission. All the so-called IFA is bullsh*t as most of the time, they don't show clients 10 or more plans for comparisons. Who knows, maybe the plan they sell you is the one with the highest commission.

Then, they see ghost say ghost word, see human say human words. For eg, if they see client got company P plan, they will badmouth company P plan and say another plan from company G is good. Then for another client with company G plan, they will badmouth it and say company P plan is good. A lot of hypocrites one, maybe only 1 good in 1000 IFA.

I heard that providend charged high prices for advice you can get for free if you google.

 

[HandsTied]

I don't understand why you mentioned that some FA are "non-independent" and yours is "independent". You tends to put down others to make yourself superior.

Clearly you indeed do not understand at all. There are Independent Financial Adviser (IFA) firms and there are non-independent Financial Adviser firms. These are matter of facts and not matter of opinion. Whether a firm is Independent or not is defined by MAS. I do not define it.

How much fee based advisory service have you provided... So after the fee based advice, you earn another revenue through the product commission?

There are different fee-based models. I do not currently charge fees.

There isn't any FA firms that cut deals with firms to purposely promote their products. It is offer to all FA firms with the same remuneration.

I think you need to do research about this industry.

 

[Insurance Broker]

Clearly you indeed do not understand at all. There are Independent Financial Adviser (IFA) firms and there are non-independent Financial Adviser firms. These are matter of facts and not matter of opinion. Whether a firm is Independent or not is defined by MAS. I do not define it.



There are different fee-based models. I do not currently charge fees.



I think you need to do research about this industry.

If you are so good, please give me a example of a "independent FA" and a "non-independent FA".

I am sure many will like to see the list.

Only 100% fee based advisor are consider as INDEPENDANT. The other FA firms are all the same, most thinks they are IFA just because they have a whole range of products to distribute isn't it.

It is up to the advisor whether to recommend the right/wrong product which is morally grey. No right or wrong, cause the products have too many features.

Some ifa says Tm legacy plus is good, some says Ntuc income vivolife is good, some says manulife star protector is good.... Some only sells term and invest the rest and says that all whole life and endowment are bad... All is their own opinion isn't it.

 

[HandsTied]

If you are so good, please give me a example of a "independent FA" and a "non-independent FA".

I am sure many will like to see the list.

Firms such as Finexis and IPP are non-independent. To illustrate how non-independent some financial adviser firms can get, one can look at an extreme example for a non-independent financial adviser firm - Great Eastern Financial Advisers Pte Ltd is a clearly non-independent FA firm wholly owned by an insurance company.

An example of an IFA is First Principal Financial, or Promiseland Independent Pte Ltd.

There are many firms in Singapore. One can check the requirements of using the term "Independent" in this 10-page guideline by MAS: http://www.mas.gov.sg/resource/legi...lines/FAA-G05 Use of the term Independent.pdf

Only 100% fee based advisor are consider as INDEPENDANT. The other FA firms are all the same, most thinks they are IFA just because they have a whole range of products to distribute isn't it.

It is up to the advisor whether to recommend the right/wrong product which is morally grey. No right or wrong, cause the products have too many features.

Some ifa says Tm legacy plus is good, some says Ntuc income vivolife is good, some says manulife star protector is good.... Some only sells term and invest the rest and says that all whole life and endowment are bad... All is their own opinion isn't it.

The fact of the matter is that MAS sets forth the guidelines on the term Independent, and there are IFA firms that have met these requirements and thus can be called Independent Financial Advisers. On the other hand, there are firms which do not meet such requirements and thus are non-independent financial adviser firms.

Of course, the degree of independence again depends on the adviser himself. Independence of the industry can be drawn onto a continuum - The most independent will be represented by IFAs, and the least independent of the spectrum will be represented by tied agencies. Non-independent FAs will fall in between.

 

[Insurance Broker]

Great Eastern financial advisor pte Ltd is non-independent as it is a subsidiary of great eastern.

Why do you say that finexis and IPP are non-independent. From what I know, they carry the same products provider just like your company.

Anyway it really depends on the advisors, a so called independent financial advisor will also not recommend his client to buy a product which he do not offers, eg. ETF. But focus only selling the lousy unit trusts products with high annual management fees thinking that it is better off selling ILP to clients.

Yet a tied agent will actually get the clients to buy ETF as they focus on their traditional life insurance products.

Anyway, for consumers, do your own homework. Don't believe in the so called independent financial advisor just because they comes from a independent advisory firms.

 

[FP_IFA]

Great Eastern financial advisor pte Ltd is non-independent as it is a subsidiary of great eastern.

Why do you say that finexis and IPP are non-independent. From what I know, they carry the same products provider just like your company.

Anyway it really depends on the advisors, a so called independent financial advisor will also not recommend his client to buy a product which he do not offers, eg. ETF. But focus only selling the lousy unit trusts products with high annual management fees thinking that it is better off selling ILP to clients.

Yet a tied agent will actually get the clients to buy ETF as they focus on their traditional life insurance products.

Anyway, for consumers, do your own homework. Don't believe in the so called independent financial advisor just because they comes from a independent advisory firms.

HandsTied is right. Both Finexis and IPP are not really independent. The recent Finexis and AXA messed tied up was proof of it. Both didn't put themselves as independent in their website although the agents themselves might declared otherwise.

If a FA is independent, the FA will not have such special agreements with any particular insurer regarding special commission or create special plan that only the particular FA can sell.

I am not going to go into a discussion on whether IFA is better or tied agent is better. There are always good and bad eggs on both sides.

 

[HandsTied]

Great Eastern financial advisor pte Ltd is non-independent as it is a subsidiary of great eastern.

Why do you say that finexis and IPP are non-independent. From what I know, they carry the same products provider just like your company.

Anyway it really depends on the advisors, a so called independent financial advisor will also not recommend his client to buy a product which he do not offers, eg. ETF. But focus only selling the lousy unit trusts products with high annual management fees thinking that it is better off selling ILP to clients.

Yet a tied agent will actually get the clients to buy ETF as they focus on their traditional life insurance products.

Anyway, for consumers, do your own homework. Don't believe in the so called independent financial advisor just because they comes from a independent advisory firms.

Of course it depends on the adviser himself, just that someone who is ethical and competent will definitely be able to benefit his clients more in an independent environment over a non-independent or tied environment.

Definitely agree with your last statement - an IFA does not guarantee that the adviser is ethical and/or competent: "All good advisers are IFAs, but not all IFAs are good advisers."

 

[attarturk]

what f***8542;***8541;k. ppl ask question u stupidos still argue who right.or wrong. gosh
ugly singaporeans.

 

[Sofiawotson]

I would suggest that you invest in an ILP (investment linked insurance policy), which is both an Investment and an Insurance plan. Refer to this for more info on the policy: An ILP Big On Investment – SharesInv.com

 

[RockyHero]

I would suggest that you invest in an ILP (investment linked insurance policy), which is both an Investment and an Insurance plan. Refer to this for more info on the policy: An ILP Big On Investment – SharesInv.com

Totally disagree. ILP has too much upfront fee and pays too much to the insurance agent. Will be better if you buy term and invest the rest

 

[IFAadvisor]

Hi guys,

I've recently stepped into the working world, and thinking of getting either one of the above-mentioned. Which one do you guys think is the one that a mid-20s guy should get first? Insurance for its lower premium, or savings plan?

With regards to savings plan, anyone here has any? Which company's savings plans are considered the best in your opinion? I've talked to Prudential and HSBC advisers; and the difference that I garner from that is that HSBC offers the full guaranteed amount of your amount saved (100%) but with a lower projected yield at maturity. Prudential, on the other hand, only offers 60% guaranteed returns on your savings, but has a higher 'projected' maturity yield, but subject to economy performance etc...

Any opinions or differences that any of you bros know of?

Cheers!
A guy trying to plan for his financial future

Hi,

Start off with a good protection plan with CI. It provides you and family a replacement of income if in an event you lost the ability to work. Also a shield plan to protect yourself from hospital bill

As for saving plans, what you need to consider is just the yield (IRR) per year, your comfortable timeline and budget. Some companies now provide high guarantees at maturity too.

Most people build these over the years, don't need to strain yourself too much as you just started work. A good adviser will review your portfolio every now and then. Stay balanced and have a bit of cash savings first (about 3-6months).