Invest in Government Securities

Dear Mr. Tan,

I have written a series of posts this time on Singapore Government Securities i.e. SGS T-Bills and Bonds. Some of the topics I covered includes on an introduction to SGS, how to buy SGS and the advantages of SGS over fixed deposits. If you think it's useful for your readers, I would be glad if you can post on it on your blog. The link is http://www.moneytalk.sg/search/label/SGS. Thanks.

See the contact person; read my blog

Dear Mr. Tan,

I have just received a rejection letter from the financial institution. What do I do? Who should I approach?

REPLY

Please read my blog. I do not have the time to give individual advice. I cannot also find the time to search for information for you. You should contact the contact person for the product that you have bought (listed in my blog) and ask for his or her advice on the actions that they are planning.

Register for class action now

Dear Mr. Tan,

I have registered my complaint with FIDREC. Can I wait for their reply, before deciding on the class action? When is the closing date?

REPLY

You must register for the class action now. The lawyer will accept your registration on a tentative basis, and allow you to withdraw if you accept an offer of settlement through FIDREC.  You should also learn about the advantages and risk of the class action now. 

If you wait for FIDREC's reply, it may be too late for you to join the class action. It is all too late for the lawyer to accept you at that time.

To register for the class action, you must see the contact person for the product that you have invested. This is shown in my blog. Search for it there. Please do not expect me to handle your individual request or to give individual advice, as I do not have the time to handle so many people.

Minibond Seminar - February 2009

The Minibond Victims Group will be organizing a seminar before the end of February under the theme "Rejected Or Partial Compensation: What Do You Do Next?"

We are expecting a Senior Counsel to be present during the seminar. Further details of the date, venue etc will be posted in Mr. Tan's blog as soon as possible. We will also be sending email updates to all those who have registered with us .

Minibond Victims Group

Standard Life to repay clients

Standard Life is to reimburse 97,000 customers who lost 5% of their money when the value of its Pension Sterling Fund, worth £2.1bn, was cut last month. Story.

Use CPF to repay education loans

Dear Mr. Tan,

Govt have been urging us to upgrade our skill etc. Since the global market is so bad now, why can't we use our CPF funds for our educations fees? Some of us hv to resort to taking loan from bank to service our edcuation. I feel we should be allowed to use CPF to service our education loanm, since the Government has also dipped in the country reserve. Do you think we can bring this up?

REPLY
I suggest that you see your Member of Parliament.

Term insurance - for family protection

Dear Mr. Tan,

You advised a person to have life insurance for 5 to 10 years of earnings. If I earn $50,000 a year, do I need $500,000 of life insurance? How much will it cost? Can I afford it?

REPLY

Assume that you have a young family and you are now 30 years old. If anything happens to you, you your family will need an income for the next 25 years (until the children are grown up). Let us assume that 60% of your income is set aside for the family expenses (i.e. 40% is for taxes, savings, and your personal expenses). Your family needs $30,000 yearly for the next 25 years.

Using a discount rate of 3%, the present value of the 25 year income stream is $538,000. This is 10 years of your income.

If you take a level term insurance for 25 years, you have to pay an annual premium of about $850 (male) or $475 (female). This are my indication of the fair premium rates. It represents less than 2% of your earings. You may be able to find an insurance company to offer a lower premium rate.  

You can set aside 10% to 15% of your earnings as savings. You can invest in a balanced fund comprising of bonds and equities. 

If you wish to pay a lower cost, you can buy a term insurance that reduces the sum assured gradually over the term. (As your children grows older, you will need less coverage to take care of their needs. Also, you savings would have increased each year). The cost of a decreasing term insurance is less than 50% of the level term insurance (indicative $425 for male, $240 for female).

I will be approaching a few insurance companies to offer attractive term insurance rates to members of FISCA (i.e. the financial services consumer association to be launched soon).