Edited from an article in: http://www.guardian.co.uk/money/2008/aug/23/scamsandfraud.consumeraffairs1 Lesson:
Land banking is listed as a scam in this article.
Land banking
Here you are persuaded to pay a large sum of money for a tenth of an acre in a field - on the promise the land will soon receive planning permission and soar in value. So far, no land banking site has ever gained the building go-ahead. Most land sold in this way is green belt or zoned for agricultural use only.
But land bankers seize on every government statement about the need for more homes to stress that this means that it is certain that the site they are selling will soon be covered in houses - like almost all scams, this relies on an element of truth.
Thursday, September 4, 2008
Continue an existing whole life policy
Hi Mr Tan,
I've been reading your website with interest recently, and I noticed that you do not believe in the need for life insurance after the age of 65. I understand your point of view that as the kids have probably grown up already and you are retired with your nest egg funds and no need for the coverage.
However, I have the following view. If I have already saved up enough money for my retirement without the need to surrender my life plan which I started at a young age (thus high coverage and cash value), wouldn't you think it would be better for the family to have that whole sum? I'm assuming life plans cover death up to age 99.
Example, I buy a whole life plan since I'm 21, with death coverage of $200,000. Upon age 65, cash value may be another $200,000. If I do not need the money, I could just leave it there, paying my insurance charges, and assuming I die age 70, my family will have sum assured $200,000 + cash value $200,000, therefore = $400,000 instead of me terminating the policy at age 65, withdraw the money and place in fixed deposits for the next 5 years until iIpass away at age 70?
Please correct me if I'm wrong in any of the assumptions I've made, but what I'm trying to say is that, leaving the money for my next generation through insurance may be another way to look at it instead of the simplistic approach of terminating all my policies once I reach age 65. It should all depends on individuals.
Thanks for your time, and hope to hear your point of view.
REPLY
Please read this blog and watch the video by Suzy Orman
http://tankinlian.blogspot.com/2008/08/susie-orman-on-life-insurance.html
As you have already taken a whole life policy, you can continue with it and leave the proceeds to your children, especially if you have sufficient money to meet your own needs. For young people who are not so well off, it is better to buy term insurance for 20 to 30 years, and invest their savings in a low cost investment fund.
Read this FAQ about continuing with an existing life policy:
http://www.tankinlian.com/faq/exist.html
I've been reading your website with interest recently, and I noticed that you do not believe in the need for life insurance after the age of 65. I understand your point of view that as the kids have probably grown up already and you are retired with your nest egg funds and no need for the coverage.
However, I have the following view. If I have already saved up enough money for my retirement without the need to surrender my life plan which I started at a young age (thus high coverage and cash value), wouldn't you think it would be better for the family to have that whole sum? I'm assuming life plans cover death up to age 99.
Example, I buy a whole life plan since I'm 21, with death coverage of $200,000. Upon age 65, cash value may be another $200,000. If I do not need the money, I could just leave it there, paying my insurance charges, and assuming I die age 70, my family will have sum assured $200,000 + cash value $200,000, therefore = $400,000 instead of me terminating the policy at age 65, withdraw the money and place in fixed deposits for the next 5 years until iIpass away at age 70?
Please correct me if I'm wrong in any of the assumptions I've made, but what I'm trying to say is that, leaving the money for my next generation through insurance may be another way to look at it instead of the simplistic approach of terminating all my policies once I reach age 65. It should all depends on individuals.
Thanks for your time, and hope to hear your point of view.
REPLY
Please read this blog and watch the video by Suzy Orman
http://tankinlian.blogspot.com/2008/08/susie-orman-on-life-insurance.html
As you have already taken a whole life policy, you can continue with it and leave the proceeds to your children, especially if you have sufficient money to meet your own needs. For young people who are not so well off, it is better to buy term insurance for 20 to 30 years, and invest their savings in a low cost investment fund.
Read this FAQ about continuing with an existing life policy:
http://www.tankinlian.com/faq/exist.html
Million Dollar Round Table (MDRT)
Dear Mr. Tan,
I was previously an insurance agent and a salaried agency supervisor with two different insurance companies. From my experience, I have learned to be less than enthusiastic about the so-called prestige of the MDRT (Million Dollar Round Table). In fact, I might even have been sceptical.
The MDRT measures an insurance agent by the first year commission earned on new policies sold. It equates equates more commission earned to being more successful and prestigious. As a sales motivation, , it drives the agents to earn higher incomes. However, it may also tempt many agents into dubious practices in pursuit of qualification for membership.
I feel that to the ultimate consumer, the insurance client, buying a policy from an agent who makes $30,000 p.a. is no different from buying from an agent who makes $300,000 p.a., as long as it's a suitable policy. Just a suggestion. I hope that you may like comment on the MDRT in your blog.
REPLY
You have already made the point well. I have no further comments.
I was previously an insurance agent and a salaried agency supervisor with two different insurance companies. From my experience, I have learned to be less than enthusiastic about the so-called prestige of the MDRT (Million Dollar Round Table). In fact, I might even have been sceptical.
The MDRT measures an insurance agent by the first year commission earned on new policies sold. It equates equates more commission earned to being more successful and prestigious. As a sales motivation, , it drives the agents to earn higher incomes. However, it may also tempt many agents into dubious practices in pursuit of qualification for membership.
I feel that to the ultimate consumer, the insurance client, buying a policy from an agent who makes $30,000 p.a. is no different from buying from an agent who makes $300,000 p.a., as long as it's a suitable policy. Just a suggestion. I hope that you may like comment on the MDRT in your blog.
REPLY
You have already made the point well. I have no further comments.
Wednesday, September 3, 2008
Articles in Online Citizen
I write an article each week for the Online Citizen.
It can be accessed at www.theonlinecitizen.com
Here are some of my articles, and the comments from the readers:
Beware of scams
http://theonlinecitizen.com/2008/09/beware-of-scams/#comments
One country, two systems
http://theonlinecitizen.com/2008/08/one-country-two-systems/
Poor return on life insurance policies
http://theonlinecitizen.com/2008/08/poor-return-on-life-insurance-policies/
We, the citizens
http://theonlinecitizen.com/2008/08/we-the-citizens/
Important to build a gracious society
http://theonlinecitizen.com/2008/07/important-to-build-a-gracious-society/
Give equal access to social benefits
http://theonlinecitizen.com/2008/06/giving-equal-access-to-social-benefits/
It can be accessed at www.theonlinecitizen.com
Here are some of my articles, and the comments from the readers:
Beware of scams
http://theonlinecitizen.com/2008/09/beware-of-scams/#comments
One country, two systems
http://theonlinecitizen.com/2008/08/one-country-two-systems/
Poor return on life insurance policies
http://theonlinecitizen.com/2008/08/poor-return-on-life-insurance-policies/
We, the citizens
http://theonlinecitizen.com/2008/08/we-the-citizens/
Important to build a gracious society
http://theonlinecitizen.com/2008/07/important-to-build-a-gracious-society/
Give equal access to social benefits
http://theonlinecitizen.com/2008/06/giving-equal-access-to-social-benefits/
Unclaimed money
Banks and life insurance companies make a lot of profit from customers who were not able to claim what wa due to them.
Watch this video:
http://www.youtube.com/watch?v=1_BWTYv7ey4
Watch this video:
http://www.youtube.com/watch?v=1_BWTYv7ey4
Investing in Volatile Markets
What are the three most important factors in investing in property? They are location, location and location.
What are the three most important factors in investing in equity? They are timing, timing and timing.
If you invest at the right time, you can earn 5% to 10% more, compared to investing at the wrong time. What is the right time? It depends on major events and how they affect the market prices.
You can learn about the impact of events on market prices through this simulation game:
www.tankinlian.com/trader
Tips:
1. If interest rate goes up, the currency goes up
2. If USD goes up, JPY and EUR is likely to come down.
3. If stock goes up, bond is likely to come down (as people sell bond to buy stocks)
4. If oil price goes up, USD is likely to come down, and gold will go up.
5. If the US economy does well, the US stock and USD is likely to go up.
6. If company profits goes up, the equity is likely to move up.
With these tips, see if you can learn the right timing decisions!
What are the three most important factors in investing in equity? They are timing, timing and timing.
If you invest at the right time, you can earn 5% to 10% more, compared to investing at the wrong time. What is the right time? It depends on major events and how they affect the market prices.
You can learn about the impact of events on market prices through this simulation game:
www.tankinlian.com/trader
Tips:
1. If interest rate goes up, the currency goes up
2. If USD goes up, JPY and EUR is likely to come down.
3. If stock goes up, bond is likely to come down (as people sell bond to buy stocks)
4. If oil price goes up, USD is likely to come down, and gold will go up.
5. If the US economy does well, the US stock and USD is likely to go up.
6. If company profits goes up, the equity is likely to move up.
With these tips, see if you can learn the right timing decisions!
Whole life Limited Payment
Hi Mr. Tan,
My friend, an insurance agent advised me that there is a new life policy where I only need to pay premium for 15 years. My present policy (which I bought from another agent before) needs the premium to be paid until I am 85 years old. She said that it is better to pay more and have the premium stop after 15 years. Should I stop the old policy and take the new one? I find the premium for the new policy to be quite expensive.
REPLY
Your agent is trying to "twist" your policy. Read this blog for an explanation about twisting:
http://tankinlian.blogspot.com/2008/09/twisting-is-bad-for-customer.html
You should lodge a complaint against the agent for this unethical product. Did the agent tell you that she is earning commission by selling the new policy to you? Did she tell you how much is the commission?
My friend, an insurance agent advised me that there is a new life policy where I only need to pay premium for 15 years. My present policy (which I bought from another agent before) needs the premium to be paid until I am 85 years old. She said that it is better to pay more and have the premium stop after 15 years. Should I stop the old policy and take the new one? I find the premium for the new policy to be quite expensive.
REPLY
Your agent is trying to "twist" your policy. Read this blog for an explanation about twisting:
http://tankinlian.blogspot.com/2008/09/twisting-is-bad-for-customer.html
You should lodge a complaint against the agent for this unethical product. Did the agent tell you that she is earning commission by selling the new policy to you? Did she tell you how much is the commission?
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