Many of us may not have met an independent financial advisor or have not even heard of this term called “IFA”. I am not surprised as the number of independent financial advisors in Singapore may be less than 5000 as compared to the huge number of insurance agents.

If I ask you whether you have an insurance agent friend, I am sure you will know one but most likely you may not know a friend who is an independent financial advisor.

So what’s the difference really?

Both can offer insurance as well as investment products. Both can give financial advice, both can calculate your retirement nest egg, both can calculate your child’s education fund needed in 20 years etc…

So where is the BIG difference?

In my opinion, the BIG difference lies in the word “independent”.

Being Independent, gives you the assurance that you are getting unbiased and independent financial advice. You can rest easy that your independent financial advisor will offer the most appropriate product to match your financial needs. The IFA company would have done it’s due diligence before approving the financial product to be listed in their “Approved List”. The IFA company is not obligated to market or sell any insurance or investment products at all. In fact, it has the right to reject any product that does not meet it’s house recommendation criteria.

The Monetary Authority of Singapore (MAS) conducts numerous checks on these companies, making sure their financial advisers comply and meet all the rules and regulations set under the Financial Advisers Act.

Being Independent, you will know you are dealing with a professional who takes the job seriously and will not compromise on the high standards set by MAS. Any violations can land the adviser in hot soup and even lose his license to work.

So the next time you meet an independent financial adviser, you can be sure you are in good hands.

In Singapore, at the top of every parent’s agenda is their children’s education. It is said that the best gift a parent can give to a child is the gift of an education. But it does not ends here! It is not just any education, but the best education available in the world.

We believe that giving the best education for our children will definitely secure their future as well as ours. Why? Because when our children graduate with a good degree or a Masters degree or a Doctorate, we believe they will secure good paying jobs which in turn means they are financially stable. They will be able to take care of us in case we need some financial help. Right?

Many of us send our kids to tuition centres or send the tuition teachers to our homes for additional lessons. Many children are forced to do their homework as well as attend additional lessons after school. Parents are willing to spend hundreds or even thousands of dollars on tuition. Hmmm…. maybe we should consider a career as a tuition teacher!  Just kidding…

Yes, education is BIG business in Singapore.

Please meet up with your independent financial advisor to find out how much you will need to put your children through tertiary education ( local or overseas ). Start planning now or else regret that you did not start earlier and you will feel the heavy burden of taking a loan to finance your children’s education. Do you want your children to start their careers with a loan hanging around their necks?

Talk to me if you are not sure how much you will need to save for your child’s education.

Remember in financial planning, I separate the best from the rest!

Adviser Profile – Stephen Mok (MAS Representative Number: MCH100038921)

Stephen Mok has been in the Financial Advisory industry for the past 11 years and his purpose in staying in this industry is to help people achieve financial security and success. He joined IPP Financial Advisers Pte Ltd on 18 April 2005. He is 48 years old and he is married to Priscilyn and has two teenage daughters, Clarissa and Valerie, aged 16 and 18 respectively. All of them are Christians and were baptised at Agape Baptist Church in 2004.

As the head of his household, Stephen is aware that providing financially for his family needs is very important but character building is equally important. He leads a balanced life style that is not just about work but family unity and spiritual growth are equally important.

Stephen has been running a successful business referral group meeting every Thursday morning for the past 8 years and most of his business have been through word of mouth referrals. He welcomes any business owner to join his group meeting which is held at One Raffles Place.

More details can be found at www.bni-harvest.com .

Stephen has been writing a financial planning blog since 2007 and his blog can be found on the first page of the Google Search Results when you Google search for “ Independent financial advisor” . His blog can be found at www.kairosadvisor.com . The aim of his blog is to educate the public on how to achieve financial security and success without taking unnecessary risks and to make sound financial decisions based on independent and unbiased financial advice.

Stephen would like to take this opportunity to wish you and your family a Blessed and Happy Chinese New Year abounding in good health and prosperity all year round.

We wish you a Merry Christmas & a Happy New Year!

Wow, today is Christmas eve and the new year is approaching in a week’s time. Some of us will be looking forward to all these celebrations while others will be depressed for many reasons.

Time flies but we are the pilots in control of our lives. For better or for worse.

I have written 37 posts in my blog since January 2011 and looking back I feel happy and satisfied that many people who applied what they read has benefitted from reading my blog posts. Statistics have shown me that readership on my blog has risen steadily since I started writing in 2007.

I would like to thank all my readers for your support  and encouragement all these years. I know that many of you have read my blog post but did not write to me. I always look on the bright side of things in life, as long as my posts benefit anyone, even one person, I will be very happy to continue writing.

I hope that you will continue to review your financial plans with your independent financial advisor every year or every two years so that you will keep on track to achieve your financial security and success.

Many natural disasters have happened around the world and we should be thankful that Singapore has been spared of such severe disasters which had claimed thousands of lives. We have to thank God that we were born in Singapore and not somewhere else with earthquakes, severe flooding, drought, severe snow storms, land slides, tsunamis, volcano eruptions….

Next, if you have never sat down with an independent financial advisor may I urge you to start planning now. Each year you delay will cost you more to implement and you may run short of time to implement your plans. Do not be complacent and think that you are still young. That’s what I thought when I was 21, just fresh out of the army. Now I am 48 years old… 27 years has passed. Yes, wow… that’s quite a long time. If I had saved just $200 a month ($2400 a year ) for the passed 27 years and invested it at 5% returns, I would have $137,766.20 by now. How many of us can save $200 a month? I believe many of us can do it. But how many of us have $137,766.20 in liquid cash assets? Not many… Why?

Simply because we did not do anything to start a consistent and disciplined method of savings and investment. However there is one account that almost every Singaporean has and that is our CPF accounts. Compulsory savings works and most of us have CPF savings for buying our houses and paying for our children’s tertiary education. After paying for these two big ticket items, most of us will have very little left to fund our retirement years.

It is very important for us to wake up and see that if we do not set aside additional savings for our retirement years, we will have to live in very uncomfortable twilight years. No one can guarantee anyone lifetime employment. Can you still work at age 65 to 75? Just look at your work place, how many old people do you see?

Make a date with me in January 2012 and start to create a savings plan that will achieve your retirement goals. What kind of lifestyle do you want to live in your golden years?

Time flies but you are in control. Don’t lose control by not deciding to do anything now.

To end my last blog post for 2011, I would like to wish all my clients, friends, associates, colleagues and relatives a very Blessed Christmas and a Prosperous New Year 2012! God bless one and all with good health to enjoy all the wealth. Share your wealth with others and you wil be given more!

You may be one of the early birds to begin reflecting on your life before the end of the year arrives. Great! I am sure you are different from the rest of your circle of friends. May I suggest you review your financial security with your independent financial advisor?

Many Singaporeans make new year resolutions to earn more money, start a new business venture, start a fitness program, spend more quality time with their family… Seldom do we take time to review our financial security.

Over the years, your income has increased many folds and you have been very busy at work, climbing up the corporate ladder. Let me suggest you call up your financial advisor to go through your family’s insurance policies and see if you need to increase or decrease your insurance coverage. Is there any area that you may have missed out earlier due to your budget constraint?

It is vitally important to review your financial plans because you may be in a rude shock when you find out that you do not have adequate financial backup in an catastophic event that drains all your financial resources. Are you on track to achieve your financial independence by the age you have set? Will your children have the funds to go to that prestigious university in USA?

Make your new year resolution leak proof by engaging an independent financial advisor to help you see your plans from a professional angle.

You can also call me if you do not have an independent financial advisor. I will be glad to be of service to you.

Read this article on how to stay on course after you write your new year’s resolution. Click here to read the article.

If you are travelling soon, please remember to buy your travel insurance. I have heard many stories of how people lost a lot of hard earned money after they fell sick, got robbed, got picked pocketed, lost bagage, flight delays and even dying overseas…

More details here – MSIG TravelEasy Promotion ends 31 Jan 2012. Please contact me if you are interested.Tel: 90011082 The brochure is attached MSIG TravelEasybrochure

For a start, you should save as much as you can now. Most financial advisers will advocate you to save at least six months of your expenses as an emergency fund. This is to provide you with six months of living expenses should you be retrenched suddenly. You may save more if you are working in a very specialised field where it is not easy for you to find a similar job.

Next you should look at Medical Expenses should you be hospitalised. This is the very basic insurance you should have. It can be paid using your CPF Medisave and a little bit of cash for a good plan.

Next comes the income replacement should you be critically ill or permanently disabled due to an accident or illness.  You should look for a plan that pays you a sum of money to last at least four years of your income plus another sum of money to support three years of your income for non claimable medical expenses.

If you have parents or siblings dependent on you to provide for them, you have to calculate how much they will need should you be taken out of the picture suddenly.

Finally, you should look at a disability income plan that pays you a percentage of your last drawn salary so that you will not be derailed in your accumulation plan.

You should discuss your plans together with your girlfriend so that she will understand and support your savings and investment plans before you are married. This is vital to prevent future squabbles over financial matters. Next meet an independent financial advisor together for a solid foundation in your plans before you get married.

For a great 30% discount on travel insurance, please visit this website at https://www.acetravelinsurance.com.sg/ATISG/

Please email your request to purchase this plan to jacobchow@ippfa.com

Thank you and have a happy holiday!

Recently people I know closely have passed on. I am reminded again that what Plato, the Greek philosopher said was true. he said, “There is nothing more certain than the certainty of death and there is nothing more uncertain than the moment and timing of death.”

You see, death for everyone of us is certain, only the moment and timing is unknown to anyone. Sad to say, the moment we were born, we were heading towards the moment of death. For some people, it can even be immediately after birth due to a birth complication. For others it may be due to illness at childhood, an accident at any age and for some after living to a ripe old age of more than 90 years!

If death is so certain, then we must be prepared to face it. One day, we will just “black out” and go to another place called heaven or hell. This is for you and me to find out when we reach that moment.

The common concern that all independent financial advisors, insurance advisors or financial consultants share is this… Do you have anyone financially dependent on you at the moment when you leave this place called earth? If you have, please read on. If not, please read on too because you can help others with this knowledge.

If you have dependents relying on your ability to bring in the income, whether they are you children, your parents or your siblings or even someone you have adopted or a charity that you have pledged to support or a child that you have adopted in Africa or east Timor etc…. you will have to consider the following points.

1) Have you written your will? Your valid will is a very important document which tells your surviving next of kin how to distribute your estate. Without it, everyone will be left clueless and may quarrel over the management of your estate. Do you want your loved ones to squabble over your “dead body”? Speak to your trusted independent financial adviser on how to create a well written will to cover all aspects of your estate. Be sure to think it over seriously, surf the net for more examples on how others manage their estate after their death.

2) Do you have adequate life insurance coverage? Most Singaporeans have less than $100,000 of life insurance coverage. How about you? Just ask yourself, after the funeral and cremation, how much money will your family have to survive on? Will your spouse need to go back to work when your money runs dry? Will anyone employ her? With sufficient money to raise your children, she will not need to re-marry or go back to work. Remember to provide for her retirement years too, in case, your children are not able to fend for her. Speak to your independent financial adviser on how much insurance to buy and the period to cover.

3) Ask yourself this question, what if you DON’T die? If you are physically disabled, whether it is a stroke, a disabling cancer, disabled after a motor accident or disabled after suffering a brain tumour…. Do you have the funds to support your family during this dire moments? Will you rely on family and friends to help you? How long can they help you and your family? Please be realistic and get the right amount of disability insurance. Talk to your trusted insurance advisor now before it is too late. In my opinion, buying an accident insurance plan is absolutely essential for anyone who rides a motorbike, even as a pinion rider.

If you need to talk to me, I will be happy to meet you to discuss your financial goals and plan to achieve them.

In times of financial strain, you may want to consider taking a personal loan from your insurance policies. Do note that not all insurance policies allow you to take a loan, only those with cash value are allowable. Mostly they are Whole Life Participating policies and endowment policies. Term policies do not have cash values so you can’t borrow from nothing. You can withdraw from your accumulation units in your Investment Linked Policies (ILPs) by selling them off, there is no need to borrow. I will not discuss the implications of withdrawing from your ILPs now. If you need more info, please discuss with your independent financial advisor.

Back to borrowing from your existing Whole Life policies or Endowment Policies. You will have cash value in your policies after 3 years most of the time. But it may vary with different insurance companies. Most of the time, you can only borrow up to 90% of your Cash Value. Cash Value is the amount you will receive if you terminate or surrender your insurance policy.,

Insurance companies charge different interest rates so I advise you to compare first before you borrow if you have insurance policies from different companies. Interest rates starts from 5.25% p.a.  Always remember to repay the loan as soon as you are able or you may consider paying back the loan on a monthly basis. If you don’t, the interest will compound until it is not worth it to redeem the loan and you will just give up the insurance policies. You will lose the financial protection that you initially bought for your family.

Be responsible to pay back the loan and not delay too long. Taking a loan is just a temporary thing and should be repaid as soon as possible. Create a repayment schedule so that you don’t feel the pinch of a large payment.

Call your insurance company to check how much you can borrow and the interest rates that they charge. They will be more than happy to lend you the money.