As from April 2013 my Journey in Investing is to create Retirement Income for Life till 85 years old in 2041 for two persons over market cycles of Bull and Bear.

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Saturday, 24 October 2020

When Your Bank RM Called??? (2)

 Saturday, 21 March 2015

Read? When Your Bank RM Called???

Wah! The last call from bank RM was 5 years ago! 

This time, bank RM introduced him Premium Financing to increase his retirement income by leveraging on the next decade of possible lower interests rate environment of 1% to 3%.

Gross XIRR over 20 years Annuity Plan is 2.5% CAGR without leverage!

2.5% CAGR is comparable to CPF OA! Decent return for fixed income with death benefits. Right?

Time to take advantage of low interest rate environment and leverage up?


  1. Hi Uncle8888,

    The interesting part is the 2 statements of the "Disclaimer" in very fine print. ;)

    Wonder if the RM can produce a table of actual age-banded returns for this product (back-tested using the relevant benchmark indices also can)? Age-banded coz those older will have lower returns due to higher annual insurance charges.

    Not so sure about decade of low interest environment. Fed only "promise" zero rate until 2022/23 LOL.

    Surprise that RM never try to sell you options structured notes. 3 to 6 months maturity with 20%-30% CAGR LOL!

    But with upcoming US elections, many RMs & their backroom quants also scared --- structuring "safer" stocks with only 10% CAGR!

  2. Not ethical for RMs to sell retiree options structured notes. 3 to 6 months maturity with 20%-30% CAGR. Right?

    For retirees; better sell them fixed income plan. Tell them better than CPF Life. LOL!

    1. Not if those selected retirees are psycho-ed into declaring themselves as accredited investors lol!

  3. "retirees are psycho-ed into declaring themselves as accredited investors"

    Ha ha! That could be true!

    For years, I never bother to update my risk profile so I am safe from unethical RMs selling higher risk investing instrument to me?

    Risk Profile
    Not Completed

    1. CW,

      Times must be bad for your RM to scrap the bottom of the barrel for low probability leads like you...

      But then, when we have to meet our monthly sales quotas, hey! Keep doing the cold calls!!!

      You never know...

      Lucky may find a yield hog waiting to be ...

    2. Time is really bad for low risk income investors as we can see more young investors joining in to top up CPF SA as long term saver and tax saving approach investing strategy.

  4. Ha. Ha.

    Looking at your displayed table already gives me headache.

    Applying adopted thumb of the rule, how to go further-Never, never invest in anything that catch no ball. Or needs much effort to understand. Simple Simon's logic.


  5. About accredited investor, how it works?

    If I am accredited at TD Ameritrade, is it applicable to all other brokers in Singapore?

  6. I have been seeing more of the same thing happening. RMs and financial advisers selling supposedly "safe" but leveraged fixed income products. Happened to me and my friend. The higher the leverage when the next crash happens, the deeper will be the crash. In the mean time, many financial players will have to keep dancing while the music continues.

    1. Today I have done the risk profiling with RM and updated my Risk Profiling with bank as follows:

      Updated Risk Profiling as follows:

      Investment Profile: C2 - Conservative Score 25 - 29

      Your priority is to preserve your capital whilst seeking investment returns that are higher than short term deposit rates. You prefer to invest in simple, low risk products, with low volatility and good liquidity. (Ha ha how true is this?)

      Also learnt something today related to the above comment on "financial advisers selling supposedly "safe" but leveraged fixed income products".

      After going through the whole list of questionnaires and ticking Yes/No and providing numbers to some of them so I interpreted it as what come under "safe" leverage for conservative investors is "declared total cash deposits with the bank or other banks is more than 2 times the loan value of premium financing" and also excess cash balance can cover the declared monthly personal expenses for two years; then it is deemed to be suitable to sell such leverage income product to the conservative investors. Not sure I interpret it correctly. LOL!


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