Komaba Global Bond Fund is going to be terminated on 5 October 2009!

Dear Reader,


It has been awhile since I last blog as I was busy being interviewed and contributing articles which will be restricted from publishing them until the magazine or website publish them for at least 2 weeks. Will keep you guys posted!

However, I have a more urgent news to break that is I have been notified by APS Komaba Asset Management Pte Ltd, that A329 Komaba Global Bond Fund will cease subscriptions with effect from today, 4 September 09, as the fund is going to be terminated on 5 October 2009.

Kindly note that more details on the above cessation will be provided shortly.

Life Insurance Tax Relief

Have you been over declaring your Tax Relief unknowingly?

Majority of the people thinks that their have paid a lot for insurance premium and when it come to declaration of Tax where there is this column for Life Insurance Relief, they feel "relief" that at least it is tax deductible but they are only half right!

An extract from IRAS Website on the subject matter as follows:

"You are not eligible for life insurance relief if your total compulsory employee CPF contribution in the previous year is $5,000 or more.

If your CPF contribution is less than $5,000, you can claim the lower of

• The difference between $5,000 and your CPF contribution.
• Up to 7% of the insured value of your own/your wife's life or the amount of insurance premiums paid, whichever is lower."

Conclusion:

Majority of the population are not eligible for Life Insurance Tax Relief unless you are self-employed without CPF contribution or low income earner where total annual CPF contribution is less than $5000 a year.

Note:

The current tax-filing system cannot detect whether you are eligible to enjoy Life Insurance Tax Relief and will not disallow any input in the Life Insurance Tax Relief column subject to a maximum of $5,000 even if you are not eligible. It is up to you to file and is your own responsibility to know how much to file. If you have been over declaring, you can write to IRAS to do an adjustment.

You can click on the following link to know more about the subject matter:

http://www.iras.gov.sg/irasHome/page04.aspx?id=208

P.S. Tax matter changes from time to time and I am not a tax consultant, hence please consult your tax consultant or IRAS if in doubt.

Best Deal for Aircon

Recently my aircon gave way after good ten years and I decided to do some research before my aircon purchase and found the following two website particularly useful to share with my reader:

1. http://singapore-aircon-advice.blogspot.com/
2. http://www.coolserve.com.sg/

I do not get any referral fee from the above but I wouldn't mind if they were to give me some for my free advertisement. Anyway good luck in your aircon purchase!

Prosperity Personal - Online Personal Finance Planning Tools

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A glimpse of Wealth Manager - Simulating investment in property

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Think you're financially smart? Take the Finance Challenge and stand a chance to win an Asus Eee PC till 30 June 2009

Prosperity Personal is an open community where netizens gather to share their wisdom, thoughts and experiences and build confidence in personal finance in a dynamic environment.

TEA ENG PENG （郑永平）Inteviewed by 《财经追击》

Hi All,

Please keep a look out on the interview of me with 《财经追击》under the programme call "Financial Planning 101".

1^st Telecast 29th May 2009 (Fri) 9:30pm Ch U

2^nd Telecast 1^st June 2009 (Sun) 11:30pm Ch U

Will keep you posted on the follow up telecast if any. Cheers!

Follow up this week they will touch on fresh grads n CPF topic.

So please look out for my interview in their programme this week.

1^st Telecast 05^th Jun(Fri) 9:30pm Ch U

2^ndTelecast 7^th Jun(Sun) 11:30pm Ch U

Other Telecast Time:

12thJun(Fri) 9:30pm Ch U

14thJun(Sun) 11:30pm Ch U - Repeat

19thJun(Fri) 9:30pm Ch U

21thJun(Sun) 11:30pm Ch U - Repeat

What you need to know about your CPF Part 2

I have found a video from CPF Website - IM$avvy on the subject "Optimising CPF" which is very comprehensive and I personally benefit from it too as it is with visual aid.

There are so much one need to know about their CPF yet too little time was spent to understand it. Thus I strongly recommend my reader to view this video before engaging any Financial Adviser for advice. It will save both your time and money in your financial planning.

Click here to Watch it! (Best view with Internet Explorer or you might need to download a player)

The video is about 1 hour long but it is definitely worth your time! It is modular too, so you can view part by part.

If you have no time to invest in yourself, the price you need to pay later might be higher for not viewing it!

P.S. Please drop me a note if the link is no longer valid and I shall remove this post. So please view it before it is gone!

CNBC Interview with Sani Hamid of Financial Alliance Pte Ltd

Sani Hamid is a Director, Wealth Management (Economy and Market Strategy) of Financial Alliance Pte Ltd and is also a good friend of mine. I am proud to present some of his interviews with CNBC that I managed to find from the internet to my readers. You can also google his name to find out more about him.

Get Into These Hot Funds - Sani Hamid (28 Apr 2009)


Worst May Be Over - Sani Hamid (13 Apr 2009)


Investment Strategy - Sani Hamid (30 Mar 2009)




Buy Financials - Sani Hamid (05 Mar 2009)




Stocks to Pick Up by Year-End - Sani Hamid (02 Jan 2009)

Comment from Reader

Recently I receive the following email from one of my reader and it motivate me to squeeze out some time to continue blogging despite of my busy schedule:

"Hi Tea,

Thank you! Your email had been great help to me.

I got to know your blog while I google for “term insurance”.

Please continue to update more on your type of insurance… your website is easier to understand than most of the others."

FREE Financial Calculation Tools Online

Recently I have found a website that provide FREE Financial Calculation Tools Online which I feel compelling to post in my blog. I am very impress because it is graphic intensive with drag and drop feature, yet very fast processing time. You got to try it to believe.

I strongly encourage all my reader to try it out before it is no longer FREE!

The website is as follows:

http://www.prosperitypersonal.sg


The links to the tools are as follows:

1. Wealth Manager
2. Prosperity Planner
3. Risk Planner

This website offer the above types of Financial Calculation Tools for your simulation and the best part is you do not even need to register as a user in order to use! Absolutely FREE with no gimmicks that I know of at this moment...perhaps they might start charging once they have enough user, so don't wait. Try now while is still FREE!

Book Review - MANIAC! "You've to be a little crazy to succeed in this crazy world!" by Andy Ong

I was reading this book written by Andy Ong who is the bestselling author of "Personal Financial Planning in Singapore" who also founded the Financial Planning Association of Singapore (FPAS) when he was 26 years of age and served as its Founding President for two terms. He subsequently became CEO of ERC Holdings Pte Ltd which is now a multi-million dollar company that comprises 11 companies withing the group with interests in education, publishing, marketing services and consulting operations.

This book bring you the mindset of Asia's 50 highly successful individuals and how you can replicate this mindset to achieve success!

In financial planning, it is not all about saving and investing but also on how to increase your personal income so that you have surplus to save and invest. I strongly recommend reading this book if you want to know the mindset of the highly successful individuals and how they make money.

I'm summarize one part which I find it most useful to share on the 4 Phase of how to move from Struggler to Maniac:


Phase 1: Step out of your comfort zone!

Maniac pointed out that many of us are so comfortable with our everyday lives that we are not contemplating our next moves. In fact, it is their personal belief that the vast majority are so comfortable that they do not plan to maximise their career potential. Even if they do, they may be short-changing themselves by setting targets that they know they can comfortably attain. The first step is thus to GIVE YOURSELF A CHANCE!

I personally feel that without this Phase 1, nothing change!

During this recession, it could be a good time to reflect what we really want in life and plan for rainy day. Many of us are too busy with our daily life running a rat race. Sometimes it take some courage to step out of our comfort zone and make some short term sacrifice in order to have long term gain. We must be crazy if we expect something different will happen by doing the same thing over again and again without changing anything.


Phase 2: Find a Mentor

Every single one of the Manics credited his or her success to someone who has guided them to succeed in their respective fields. They all have mentors who showed them directions in life and how to fully take advantage of the opportunities that they are given. You will be surprised how willing successful individuals are in sharing their experiences if you ask properly and do not intrude into their lives too much.


Phase 3: Commit to change

Knowledge is very much wasted if it is not put to use. Most of us learn what is necessary and try to implement the knowledge. However, when the first problem arises, we soon forget about the whole idea and go back to our comfort zone and safety net which often means that we are giving a half-hearted attempt. Manics commit themselves 100% and are constantly on the prowl for opportunities. They live, breathe and eat what they believe in.


Phase 4: Put together strategy to achieve personal success

Maniacs plan to succeed in their chosen field. They plan to the best of their ability, leaving as little to chance as possible They know that luck plays an important part in the path to success, perhaps even to the extent of 80 to 90%. They also want to maximise their chances on the factors they can control. These include:

- Which industry to be in?
- How to gain a competitive advantage in that industry?
- How to assemble the right team to implement the business mode?
- Putting in the extra effort to deliver a superior value proposition.

P.S. To find out more, you can either buy the book or borrow from the library and search by Call Number 650.1 ONG - [BIZ]

Who are Independent Financial Advisers (IFAs)?

Year 2009 marked my 10th year in the business and I decided to embark myself from a FA platform to the IFA platform. Some of my client asked what are the differences? So I decided to post a blog to address this.

The term Financial Adviser (FA) refers to a corporation and the individual providing the advice is referred to as the Financial Adviser Representative (FAR). Exempt FAs are banks, insurance companies, finance companies, insurance brokers and holders of a Capital Markets Services (CMS) license.

The Monetary Authority of Singapore (MAS) regulates the usage of the word "independent" by financial advisers. Amongst the key considerations for a financial adviser to use the term "independent" is the provision of more than four product providers from each class of investment product. He should have no direct or indirect commercial arrangements with product providers that will create product bias and should operate freely from any form of product restriction.

IFA firms are financial firms that are started and owned by experienced individuals from the finance industry, and are not part of any financial institution.

In summary, there are many FAs in the market but very few IFAs as using the word "Independent" would mean more regulation and not many companies are ready for that or due to the original structure of their main business e.g. the securities houses and banks. Some ask why the trouble to get myself into trouble then? My answer is simple, I believe I am ready! Being truly Independent is the way to go and will ultimately benefit my client. E.g. Now I can help my client to open securities account from more provider giving them choices rather than in the past where I can only open from one securities house because my ex-company is a securities house and there will be a conflict of interest to represent another securities house.

In a laymen term, IFA is like Carrefour which is a megamart that carries many products but none of the products belong to them. If you wanted to buy a laptop, you can choose to walk into Sony Centre that sell only Sony Laptop or you can also walk into Carrefour to choose from various brands of Laptop plus many other products that you might want all in one place which can save you time and money.

Some clients question the stability of the IFAs and the main concern is what if the IFAs firm collapse? Again my answer is simple: If you bought a Sony Laptop from Carrefour and Carrefour one day decided to withdraw from Singapore market, who will be liable if your Laptop spoil? Do you go to Carrefour or Sony? Do you worry more if Carrefour will withdraw from Singapore Market or Sony to withdraw from Singapore Market?

I think I will have more concern than the client when the IFA I decided to join eventually collapsed as that would mean that I have to find another IFA to house me, so wouldn't I be more careful than the client in choosing the IFA to work with?

After going through my stringent selecting process and talk to almost all the IFAs in the market, I decided to join Financial Alliance which is the first and only Financial Adviser Firm in Singapore to achieve both the Singapore Quality Class and the People Developer status. The coveted dual certification by SPRING Singapore was achieved only after a stringent assessment process. The company vision is "To be the guiding star in the eyes of our clients, and the inspiration for the Financial Advisory industry in the region". Over the last 6 years Financial Alliance has grown steadily from less than 10 consultants to current 150 manpower strength and is the first FA firm to win the inaugural Professional Enterprise Award - PRESTIGE in 2007. While many competitors scrambled to fight for manpower and sales, Financial Alliance focus on building infrastructure and I personally think that spells a lot on the company foresight and ability to fulfill their vision. You can also read more on their success story from the national bestseller "Asia's TOP Investments & Franchise To Make Your First Million" by Aminordin Omar & Timothy Chan (ISBN-13 9789810595210) available in POPULAR On-line Bookstore

If you are keen to explore this career, please visit www.teaengpeng.com and click on "contact" to get in touch with me.

My 10th Year in the Financial Advisory Industry

Inspired by my blogging buddies Wai Loong and Leroy writing a review of their year 2008, I decided to do a review myself on not for just one year but 10 years!


My first 1 year 6 months...

My first career after my graduation from Ngee Ann Poly was in the insurance industry. I actually got into this industry by accident and not by ambition. I did not remember wanting to be a Insurance Agent since young and I doubt anyone would have. I actually wanted to be a social worker after my graduation but if you remembered my Travel Insurance story, you would recall that my mom suffered a stroke during my last year in my Poly's days and I thought I should find a sales job with flexible hours so that I could rush back to take care of her if necessary since my Dad was having a full time desk bound job and my younger brother was studying abroad. I was flipping the newspaper and come across a sales position which was quite interesting (Of course the advertisement did not mention anything about insurance just mentioned sales position) so I called. The recruiter was very tactful and was telling me that this position required marketing of Unit Trust and as a fresh graduate from Poly engineering background, I had no idea what Unit Trust was but agreed to meet up for further discussion since I am desperate for a sales job. (For your information, Unit Trust was something new and not popularly known to everyone yet in 1999)

I still vividly remembered the place of interview was at The Adelphi opposite Funan Centre. Without any suspicious as it was in a shopping mall, I took a lift up to the office level but when I reached the door step, I found out it belonged to one of the big 4 insurance company. I was naive enough to think that there could be other office co-exist in the room so I walked in only to find out it is still the same insurance company which was too late to walk out because the recruiter warmly welcome me with a firm handshake. After a few round of talking, I then discovered that I was required to sell insurance but they promised to provide a 3 days FREE training for me to consider before joining. As an opened minded person in nature, I thought I had nothing to loss by attending and I could gain some knowledge while still searching for other sales jobs, so I agreed!

The 3 days course really open my mind and I understood the importance of insurance right away when I relate to my mom's incident. I thought I had found a dream career that fit my requirement of time flexibility and yet able to help other! (Only later to find out that most people do not want our help as they though that we want to make money out of them and treat insurance agent like a pest! This was not told in the 3 days training..hahaha) Being an engineer by training, although I was recruited by one of the big 4 insurance company, I apply a logical and systematic approach to compare all the big 4 insurance company during that time which was AIA, Prudential, NTUC and Great Eastern before deciding which company to join. (I will not reveal which company I eventually join to protect the privacy of the people and company that I'll be mentioning here)

In preparation of becoming Insurance Agent, I must pass some industry examination which was the Certificate of Life Insurance during those days (Now the requirement is CMFAS Module). We studied the difference between Agent and Broker in the text which is as follows:

Agent represents the company they work with.

Broker represents the client they work with.

Since then it inspired me to be a broker but when I ask my Agency Leader in the insurance company how can I be a Broker, he told me that the professional liability of a Broker is very high and need high initial capital to become one, so I drop the idea. Think during that time he was referring to starting a Broker Company but he did not tell me that I can join a Broker company and be their representative! On a special occasion, I bump into a friend who was a broker in one of the leading Broker Company, I decided to visit the company and find out more myself and the rest is history. I have not look back since!


My 9 months in a Broker Company...

I was very fortunate to join the right company that emphasis on training for their new adviser. If not, my learning curve would be much longer. In fact, I did not encounter much difficulties in my initial year as a Broker representative and my production was 50% more in 9 months compare to my 1 year in the previous insurance company! Imagine 1 company have 10 products, if we represent 8 companies meaning we have to study 80 products and new adviser will be overwhelmed without a good training system. However, we are still restricted to do only brokering on Life and General Insurance only. Not long after I joined the Broker company, the Financial Advisers Act was announced and everyone was preparing themselves for the transition. My immediate manager and the whole team decided to move to a bigger ship that already have all the tied up in place e.g. Unit Trust and Securities Trading which our Broker Company was not ready then.


My 6 years 9 months in a Exempted Financial Advisory Firm...

We decided to join one of the largest Securities Firm in Singapore and became their pioneer "Team Structured" advisers. Prior to that, they were managing more direct adviser and remiser converted to adviser. We grew together with the company over the last 6 years 9 months and was one of the largest and productive team in the company with 50 Advisers, 6 Managers and 1 Director at the peak of our team. I spent my happiest days in this company and also started my management path 2 years ago forming one of the 6 Managers in the Team.

Financial Advisers Act was only introduced in year 2001 and till now is less than 8 years, so is considered a fairly new market for most people. During these 6 years 9 months, many others FA firm had attempt to get me over to join their company by offering a higher compensation package but I refused to move as almost every player in the market are fighting for manpower and sales growth but few are exploring and fine tuning their processes. Until one day, I found Financial Alliance in year 2009!

I'll make new history from year 2009 onwards! Hope to write another 10 years review in years to come! :-)

See related article:
Who are Independent Financial Advisers
Travel Insurance