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Maximise Your Investments: Common Pitfalls to Avoid and Debunking the Myths of Investing

Wed, 04 Aug 2021 03:23:40 GMT

Investing to grow one's wealth is almost absolutely necessary in today's world. Besides property, are there other options apart from such an illiquid, capital-intensive investment option?

A great investor is consistent over the long-run. They always learn from their mistakes, stay within their risk profiles, and are diligent to keep on learning. They are also great at keeping their emotions in check - not allowing themselves to be swayed by fear or greed. Neither are they of herd mentality - following what their friends or market trends say.

While some believe in luck, I would say luck is over-rated and washed out in the long run. Short-term gains can be attributed to luck, while staying the course through short-term volatility to enjoy long-term sustained profits are what seasoned investors are able to do.

In short, they are able to avoid the following pitfalls that amateur or beginner investors often commit.

1. Emotional Investing

Investing based on one's emotions is the main reason why so many are not able to break through their losses. Ever so often, they are driven by greed or fear and make decisions based on how they feel the market is currently performing - buying at market highs and selling at market lows. Other times, risks are highly underestimated, resulting in poor decisions being made.

2. Timing the market

Guessing when the market will go up and down based on expected price fluctuations is almost like closing your eyes to pick something to invest in at random. This happens when overconfidence takes over sound investment strategy, and it is virtually impossible to reap any good rewards in the long run.

3. Failure to rebalance

As market conditions change quickly, it is necessary for one to rebalance their investment portfolios on a regular basis to keep their asset allocation in check and protect themselves against market volatility.

These pitfalls aside, still others are crippled by their fears and are unable to take a step towards investing because they find investing difficult. Yet, this overly cautious approach can also lead to one's income being eroded by ever-increasing inflation rates and expenses of today.

With these in mind, here are some important principles to help you kickstart your investment journey:

Let compound interest work its magic

How will a single lump sum investment of $100,000 look like?

How will your regular investment of $20,000/year look like?

Raising a child in Singapore - parenthood and money talk

Tue, 03 Aug 2021 09:16:44 GMT

Parenthood brings much joy, but in Singapore, it can also be extremely costly to raise a child.

How much does it REALLY cost to raise a child in Singapore and what are some ways to manage the high costs?

Despite the Singapore government providing a significant amount of subsidies for each child ( costing the government approximately $151,000 per child for healthcare and education etc.), most parents still feel the pinch especially when their child reaches university.

In 2021, a local university education costs between $24,000 to $40,000, while an overseas education could easily cost upwards of $100,000 per year when taking into consideration international students' tuition fees, flights and other living expenses such as rent and food.

Backtrack a little - even before your child has entered into the formal education system, various costs involved can set you back in terms of reaching your financial goals or managing your expenses. Such costs include but are not limited to:

Pregnancy-related costs - from pre-natal classes to multiple gynaecologist visits, all the way to hospital costs for delivering the baby and confinement nannies, pregnancy-related costs can easily amount to more than $10,000 per child .
Baby to toddler costs - recurring spending on diapers, formula milk, personal care products (eg. diaper cream, baby food, baby lotions etc.) costs upwards of $3,000 per year and can increase drastically when there are complications to the baby's health. Other costs relating to non-perishables include prams, car seat, clothes, milk bottles etc. can also cost at least $1,500.
Childcare costs - with most parents in Singapore falling in the category of dual-income couples, the struggle gets real after their maternity leave. Without the support of the grandparents for whatever reason, childcare costs can come up to $6,000 to $12,000 a year for childcare centres, full-time nannies or domestic helpers.
Pre-university education costs - even with highly subsidised education in Singapore, it still costs you at least $3,000 per year to cover for a child's allowance, uniforms, textbooks, stationery etc., not including enrichment classes or tuition that you register your child for.

In order to manage all of the above costs effectively, here are some strategies you can consider adopting:

Be aware of the government grants available to you - from baby bonus cash gifts, dollar-for-dollar matching to the Child Development Account to Medisave grants for all newborns, various measures are in place to ensure that the initial cash outlay is reduced.
Understand the different types of personal income tax relief and rebate - various reliefs are in place for parents in general , working mothers or if your child is handicapped .
Work out a sound financial plan based on your unique financial situation - should you do-it-yourself when it comes to investing to cover the future costs of raising a child, or should you hedge your risks by outsourcing to an instrument that will take care of the future investments if you are critically ill or pass on when your child is still young? How exactly should you split between coverage and investments?

All in all, while raising a child in Singapore is notoriously expensive, being aware of the various grants and tax reliefs available to you can help manage the costs, while proper financial planning and sound investment strategies can assist to improve your financial situation.

There is no one size fits all approach to this and we are happy to discuss the unique strategies tailored for your family - schedule a time to speak with us today.

Matrimonial Assets Planning: Navigating Through the Challenges of Divorce

Mon, 02 Aug 2021 07:19:08 GMT

Matrimonial Asset Planning is a very important part of any long-term relationship. It is important to consider what are, and are not matrimonial assets at all stages of a relationship.

A knowledge expert can discuss all of your financial options during these stages to best protect your family from sudden hardship.

Case study:

Mr and Mrs Lee were married 15 years ago. They have 3 children, aged 13, 15 and 21. They own a landed property of $5 million under joint tenancy. Mrs Lee also has a commercial office of $800k under sole ownership. She earns $1 million/year while her husband earns $40k/year.

Over the years, there have been conflicts over their living habits and Mrs Lee resents that her husband has not been contributing financially to the family. In fact, more than 90% of their residential property was paid for by Mrs Lee. Mrs Lee’s parents also previously gave $200k cash as a gift to help Mrs Lee have a headstart in building their family home.

Mrs Lee does not think that her husband is savvy enough to be entrusted with her wealth to look after the children, if she is gone. And while she is alive, she wants to ring-fence her assets for the benefit of her 3 children.

Mrs Lee is now contemplating divorce and would like to seek consultation.

1. One of the most important and basic step is to establish what constitutes as matrimonial assets.

2. Take note of when the asset pool is determined

3. Be informed of how matrimonial assets are divided

Before filing the papers with the lawyer, there are ways and instruments to achieve a more ideal and amicable outcome. As each situation is complex and unique, seek a financially-trained specialist in this area for consultation.

Matrimonial Assets Planning: Smart Money Tips For Your Marriage

Mon, 02 Aug 2021 07:19:08 GMT

Marriage - a beautiful union that is sometimes also very complex as two different lives merge. What are some smart money tips that every couple should know?

Many couples shy away from discussing about their finances despite it being one of the pillars that can make or break a marriage.

Today's globally connected society also poses various other challenges between a couple - how to procure cross-border insurance coverage for their spouse of a different nationality, how to comply with foreign tax rules or repatriate business returns, just to name a few. Such issues can be complex but there exists sophisticated digital tools and data analytics that can help you gain clarity and ha ve a decisive edge in your financial planning.

Estate Planning 101: the why, the how and the secret tools to a successful inheritance management plan

Fri, 23 Jul 2021 07:19:08 GMT

Many people think of estate planning as something that only elderly people need to think about. The truth is estate planning is something that every adult should consider.

Apart from property and investments, insurance and other estate planning instruments are powerful tools that wealthy individuals use to protect their families.

With the right solutions, here are six problems that estate planning instruments can solve:

All in all, proper estate planning can be very effective in overcoming many preventable issues and minimise family disputes.

We understand that all cases are unique. Instrument such as Wills, trusts, CPF nomination, life insurance, investments, Lasting Power of Attorney and Advance Medical Directive are often used as part of our solutions, Analysing and selecting the right tool will help solve the above 6 problems effectively.

Growth Mindset Tips with Lifetime MDRT, COT and TOT Achiever Jovin Yeo

Thu, 31 Dec 2020 10:11:43 GMT

All in the family - Jovin Yeo’s passion inspires others to a career in financial services

Wed, 16 Dec 2020 13:31:16 GMT

Originally posted on Round The Table (September/October 2017) .

Secrets to success with Jovin Yeo - TOT qualifier and youngest advisor in Singapore for lifetime MDRT

Wed, 16 Dec 2020 04:53:02 GMT

Tips from Daniel - Interview with a Special Someone

Thu, 10 Dec 2020 04:28:18 GMT

Things no one told you when you first start out as a financial advisor

Mon, 07 Dec 2020 04:43:52 GMT

66 Seconds with TOT Achiever Jovin Yeo

Sat, 05 Dec 2020 10:21:18 GMT

Establishing Mutually Beneficial Relationships With Your Clients

Sun, 01 Nov 2020 03:28:17 GMT

Originally posted on MDRT website here .

As a financial advisor, Top of Table member Jovin Yeo believes a relationship is more than just sharing aligned goals.

An MDRT member for 18 years, Jovin Yeo from Singapore strives to share a meaningful connection with her clients that is based on kindness and compassion.

How does establishing rapport help to turn prospects into clients?

Clients use logic when you talk to them about facts and statistics. However, a deeper connection is established when clients feel they are truly understood. This makes it easier for them to open up and talk about their concerns. They will share what they care about and talk about what keeps them awake at night. That’s when they will talk to us about their inner dreams and goals.

What’s the most important thing when meeting a prospect for the first time?

Before the actual meeting, I will qualify with a few questions to determine if they have concerns I can address at that time. I will also understand their profile so that I am able to speak their language. This is part of sales psychology and it works very well for me.

Can you share an example of how a great relationship has helped your clients?

In 2017, my client came to me with a 80% heart block. The private specialist quoted my client $80,000 to do a heart procedure. He asked me if I know of any other doctor for a second opinion. I recommended him to my client, who happens to be a cardiologist.

My cardiologist client is a reputable doctor and his appointments have to be booked at least three months in advance. I called for a personal favour and he replied me the very next day, which happened to be a public holiday. He gave up his lunch time just to meet my client.

On the day of the appointment, I accompanied my client and his wife to see my cardiologist client. What particularly touched me next was that my client and his wife invited me to join them during the private consultation with my cardiologist client. It meant a lot to me as it showed the trust they had in me and I am happy to be there for my clients, in good times and bad.

My client had a successful operation done by my cardiologist client and the cost was less than $20,000. That $60,000 savings really meant a lot to his family as they have to take care of their son with cerebral palsy.

What can financial advisors do to build relationships?

First of all, work on your likeability and ability to connect fast. Many advisors tend to think that to be successful, they should focus their attention on acquiring more knowledge, attend more courses and spend on more trainings. I beg to differ.

While the above is important to build up your competency, the lesser taught skills that one should pay attention to are soft skills and sales psychology.

What do you say or do when clients or prospects ask you the following:

So what do you do?
You are the fourth advisor I’ve met. Convince me why I should do business with you.
Let me think about it and come back to you. (But never did after that.)

If you find yourself stumped with some of the questions, that shows there is still room for improvement. Soft skills and sales psychology are skillsets that are often overlooked but they are important factors to determine how fast you can build trust quickly with your clients. Having said that, soft skills are not easy to acquire and you need a good mentor to constantly guide you in this area.

What have you learned about treating your client as more than just a client?

I accept that in life, sometimes you win some and you lose some too. I never turn away my clients who need help. No matter how tedious the claims could be or how complex their problems could be, I will go the extra mile if I can help solve their problems. And that’s because I treat my clients like my extended family.

In return, some of the most important takeaways I have developed is patience and having compassion for people. Always treat people with empathy and embrace an abundance mindset.

Over time, clients will tap onto our positive energy when they are ready.

Introducing Daniel and Jovin of Jovin Yeo Advisory

Tue, 01 Sep 2020 10:26:32 GMT