Friday, March 30, 2007

Dying without a Will (Part 3) - Small Estates

When a person die without a will and the estate is small (<$50,000), the administration can be attended very quickly and cost effectively through our Public Trustee. By seeking their assistance, there is no need to go through the lengthy court application or hearings which involve high cost.

* The Public Trustee recovers the assets in the estate and distributes these to the beneficiaries according to the prevailing law.
* If the beneficiary is a minor, the Public Trustee will hold his share in trust until he reaches 21 years old.
* If the guardian faces financial difficulties in maintaining the child, he/she can apply to the Public Trustee for the child's monthly maintenance.
How To Apply To Public Trustee To Be Administrator
Apply online with
the Public Trustee office. They will request for the relevant documents in the process. You may log into their website at for info.

What is the cost involved?
* First $5,000 in estate - 6%
* Next $2,000 in estate - 4.75%
* Next $3,000 in estate - 3.75%
* Next $10,000 in estate - 2.5%
* Subsequent amount - 2.0%
>> So for a full $50,000 estate, the amount payable is $1,357.50.

Wednesday, March 28, 2007

Dying without a Will (Part 2) - The Problems

Dying without a will may create a lot of problem, resulting in disputes and unhappiness in the family. Is it really that bad? Perhaps I can shed some light for you here.

1) Distribution of assets, not to deceased's intention - Eg, Mr Tan have a wife and 2 children. Nothing will be given to his parents for their old age.
2) Disagreement on who should run the estate - Family members have to apply to court for this rights. It can be lenghty process especially when they disagree on the rights.
3) Administrative Bond required by the administrator.(The bond is the guarantee required by court to guard against fraudulent administration of the estate)
4) Requirement for sureties as a guard against administrator disappearance. Such sureties must also own assets at least equal to the gross value of the deceased's estate. Not easy to find such sureties.
5) Administrator cannot transact the affairs of the estate until "Letter of Administration" is extracted from the courts. (Eg, monies from bank account for immediate family needs etc)
6) Double Estate Duties especially on common disasters. Eg Husband and wife die together. The older one will deems to die early and asset passed to the younger one. Subsequently, the asset are passed down again. Estate passed down 2 times and hence double estate duties.
7) Certain asset hard to split. Eg Properties and business assets. Can be problematic especially if a beneficiary could be still staying in it and the other beneficiary insist on selling.

I had kept the above very brief. It shall only be for your 1st level info.

Tuesday, March 27, 2007

Dying without a Will (Part 1) - Intestate

Where a person dies without a will, he is said to have died intestate. All the assets will be disposed according to the Intestate Succession Act (Cap.146), regardless the deceased's intention.

The Distribution Process
* If Spouse lives, no Parents, no Issues

- Spouse take 100%
* If Spouse and Issues lives, "regardless Parents live or not"
- Spouse 50%; Issues 50% equally shared
* If Spouse and Parents lives, no Issues
- Spouse 50%; Parents 50% equally shared
* If Parents lives, no Spouse, no Issues
- Parents 100% equally shared
* If no Spouse, Parents and Issues
- Siblings 100% equally shared (If any sibling already die, children of that sibling share the portion)
* If no Spouse, Parents, Issues, Siblings
- Grandparents 100% equally shared
* If no Spouse, Parents, Issues, Siblings, Grandparents
- Uncles and Aunts 100% equally shared
* None of the above
- Government gets all

Spouse = Husband or Wife
Issues = Child (Legitimate or legally adopted), Grandchildren and so on. It does not include Step Children

Monday, March 26, 2007

Kopitiam Talk - Minister's Salary

This is a hot topic among kopi uncles lately. Like to share my views:
Its already decided, don't need to debate
Onces they'd decided on something, they will expect everyone to swallow it. As a good citizen of Singapore, I am forced to accept it, happy or not, convinced or not...

High or Low? Depends on who you are
For a typical Singaporean, struggling with $2k/month, their salary shall be 100x more, how to accept?
For an elite, wealthy Singaporean who form the top 1% earners of the population, this will be normal.
Depends if you feel they deserved to be in this top 1%.

High or Low? Depends we choose to view big or small
Our budget is about $30billion/yr. If one minister earns $2million a year, its only 0.0067% of the budget. If 100 ministers, then it will be only 0.67%. This small budget seems reasonable if we are able to engaged the best people, making right decisions to spend the balance of the 99.33%.

What I feel?
I'm a typical Singaporean and I am not convinced that we have a serious problem of not able to engage good ministers with the current pay of $1.2million a year.
I'm curious how much George Bush or Tony Blair are earning now and whether they are corrupted or incapable if they are earning less than $2million a year.

Sunday, March 25, 2007

Financial Planning??? Can eat or not?

You might have heard about Financial Planning but do not know what is it about. Many thought that Financial Planning is completed after buying a few Insurance Plan. Its a very common misunderstanding? Hope I can remove this misunderstanding by sharing with you using simple layman language: Financial Planning is about

1) Managing your Cashflow
This is a step to detect bad spending habits and ensure you set aside enough money for future financial goals.
2) Managing your Risk
This is a step to ensure that your dependents are well taken care of in event of death, disability, Diseases, hospitalisation, etc.
3) Managing your Investments
This is a step to ensure you invest your assets properly. The right risk and right returns to meet your needs.
4) Managing your Retirement
It is a step to help you achieve financial independence and enjoy a lifestyle that you desire on retirement.
5) Mananing your Tax
This is a step to minimise your tax through the use of various tax benefits and incentives
6) Managing your Estate
This is a step to preserve your assets on death and distribute your estate according to your intentions with minimal hassles and estate duties.

Seek professional help from a Certified Financial Planner. You shall see a difference to your current financial plan. Drop me an email if you like to make this difference.

Thursday, March 22, 2007

5 tips in picking Durian

Picking a Durian is a skill. Like to share with you this skills. Next time Durian Seller cannot trick you.
1) Look at tip of stem. Should be young and white. If its hard, brown and wrinkled. It means they have been picked quite long time ago.
2) Feel the prickles. Should be stiff and sharp. If blunt and tender. It means they could be stale
3) Weigh the durian. Should feel light. If you feel very heavy, it could be overripe and watery inside.
4) Hear the durian as you shake. Should hear seeds shake. No sound could mean unripe or overripe.
5) Smell the durian from:
a) Tail end of durian
b) "Seam" where two segments meet.
Make sure scent is not overpowering which mean fruit could be overriped.

Wednesday, March 21, 2007

No free lunches in our Healthcare System

Medical Standard in Singapore is high but many do not wish to pay the higher cost that comes with it. They will ask for high standard and expect the government to pay for it. This is not viable.

This is the platform where the 3M system develops over the past 2 decades.

Layer 1 – Medisave - 1984
It forces individuals to put aside part of their income into their Medisave Account. Money from the account can be used to pay their medical expenses. This fund is capable of paying minor hospital and outpatient bills.

Layer 2 – Medishield - 1990
It is an insurance scheme which CPF Board administers. This insurance is capable of paying major hospital bills in heavily subsidized hospitals. There are many insurance companies that mimic this insurance for those who wants to stay in better hospital and wards.

Layer 3 – Medifund - 1993
It is a tax funded scheme which government pays or subsidizes the needy who cannot afford basic healthcare expenses. The fund currently stands at S$1.1 billion. The interest income from this fund is being utilized to finance this scheme.

Hence there are 2 ways to get a free Healthcare service.
1) You are very very poor. Government uses the tax collected from the people to pay your bills.
2) You are not so poor. You buy an insurance and insurance company pays your bill.

Either way, it’s the people who are paying the bills. Waiting for Government to pay for you? Haha... Remember “There are no Free Lunch in Singapore(Probably Until Elections)”

Monday, March 19, 2007

Sales of Singtel Shares after 31st Mar 07

(It was announced in late March that Sales of Discounted Singtel Shares in Singpost shall be extended till further notice) - Updated on 25th Mar 07

From 1st April 07 onwards, if you wish to sell your discounted Singtel Shares, you have to carry out the transaction through a trading account with any of the Singapore Exchange (SGX) broking firms.

Singapore Exchange (SGX) Broking Firms
1. CIMB-GK Securities ==> 1800 538 9889
2. DBS Vickers Securities ==> 6533 9688
3. DMG & Partners Securities ==> 6438 8810
4. Fraser Securities ==> 6534 5345
5. Kim Eng Securities ==> 6231 6688
6. Lim & Tan Securities ==> 6533 2070
7. OCBC Securities ==> 1800-338 8688
8. Phillip Securities ==> 6531 1555
9. UOB Kay Hian ==> 6536 9338


If you want to save trouble and transaction fee, go to any Singpost Office before 31st Mar 07 !!!
3 simple steps:
1) Bring your NRIC
2) Complete and submit a sales authorisation form
3) Receive a copy of the form after their Officer verifies your details

You may check your amount of Discounted Singtel shares below:

Tuesday, March 13, 2007

Investment and Taxi Analogy

Investment for retirement is like taking a taxi from Point A to Point B.
What are their similarities?

1) The money you have today is your point A. What you need for retirement is your point B.
2) The journey from A to B = Your current age to your Retirement age
3) To reach B faster, taxi driver have to drive faster. Faster Taxi = more risk.
If you want to retire early, you have to invest more agressively. It involve more risk too.
4) If the driver is experienced, the car is proven to be reliable and have many safety features, you might be willing to take more risk and travel faster.
Similarly, if you have an experience Adviser, the investment funds have good track records and are properly diversified, will you be willing to take higher risk too?

Either way, you will reach your destination. Its a matter of when you can achieve it. You want to retire at age 55, 60 or 65? Retire at 55? You need to take higher risk. if you want to wait till 65, take less risk. As simple as that...

Risk = Potential Rewards

Sunday, March 11, 2007

Selected Statistics from WHO

Browsed through the WHO website and found the World Health Report 2006.
Like to share 3 of the Singapore statistics found in it.

1) Life expectancy at birth Males / Female =====> 77.0 / 82.0
2) Under-5 Mortality Rate (per 1,000) Males / Female =====> 4 / 3
3) 15 - 60 years Mortality Rate (per 1,000) Males / Female =====> 92 / 51

Source: World Health Statistic 2006

2 points I like to highlight.

a) If we believe that we will die before 77 for male and 82 for female, we are probably only half right
b) Around 10% of males and 5% of female don't need to plan for retirement because they may die before they face it.

If you believe that you will not face retirement, then don't plan for it.
If you believe you will, then its advisable to take proactive steps towards it.

Tuesday, March 6, 2007

Our Neighbours

I had been reading the news with great interest lately due to our bilateral problems with Indonesia. But do you know what happen? Perhaps I can share a bit with my limited knowledge.

a) Extradition Treaty - It is the surrender of a fugitive to the jurisdiction of another state, country, or government for trial.
My view: There are many difference in our legal framework with the Indonesians. No countries are allowed to detain foreign fugitives unless a treaty is signed between the countries. However note that they are fugitives, not criminals yet. The basis to arrest the fugitive must be solid. If legal frameworks are different, it may become difficult for the Singapore Govt. to arrest someone whom under Singapore law is not an offence.

b) Sand Issue - The Indonesians sited environmental issues.

My view: How true are they? I don't know. Not sure which island had disappeared as what they described.

c) Border Issue - Singapore land area increased from 580 sqKm in 1979 to 699 sqkm in 2006 due to reclamation. Indonesia sited that we could be invading into their territorial grounds.

My view: The Indonesian government are probably trying to invoke nationalism to their people by saying this.

My Overall View: When this small little red dot did well, her larger neighbours feel that the success are attributed to them. Naturally, they will insist that this small nation give in to their demands.

I'm fully supportive of my country decisions by not giving in to pressure. There must be negotiations to get a fair deal. We must show our dignity to gain respect from the world.

Hope things will tide over soon...

Monday, March 5, 2007

The GST Budget Package

GST of 7% starts on 1st July 2007. Most of us will be getting GST credits in Cash over next 4 yrs.

1) Those who lives in 1-3 room flats with assessable income below $24,000/yr
=> $250/yr x 4 yrs

2) The general population will receive
=> $200/yr x 4 yrs

3) Unless Housing Annual value exceed $10,000, then will get
=> $25 or $100yr x 4 yrs depending if assessable income exceed $100,000/yr

** NSmen and NSF will get an additional $100 of GST Credit.

Thursday, March 1, 2007

Market Correction Finally

The market correction finally comes. Its a good time for investment consolidation.

Firstly, share with you why this correction comes:
1) There are rumours that Beijing may levy a 20% capital gains tax on stock investments in bid to prevent market from overheating. This sparks a 9% decline in the Chinese Stock Market
This decline spread to other financial markets especially those in Asia
2) It is investors' psychological wants. There was fear when market rise too fast. Big players are probably manupulating prices to spark more fears.
3) Investors are just finding a chance to correct the market. It is not a sign of the bear market.

Why I say its a good time to consolidate some funds now?
1) The rise in market is well supported by earning reports and projected growth
2) Most stocks market in the region are not expensive or over-valued now
3) The recent sell-off is largely due to sentiments

What are you waiting for? Find a chance to invest...