Fee Based Financial Planner

[iisterry]

Wa, i took a look at his website and comprehensive planning requires 20-59 hours. Which translates to S$2000 to S$5900. So expensive i wonder whether they provide guarantee in the event things didnt turn out as plan or the consumer can sue them for it.

I think for simple planning (based on his description) some ethical non-fee based life planner can do it.

I think the ideal segment for fee-based planners would be the "ignorant ones". Ironically, the very people who needs such advice are the ones who are most ill-inclined to pay for it.

It isn't a small sum, not to mention that it is over and on top of the distribution fees that the actual products charge. He does have a disclaimer saying that he might receive additional commissions from the tied distributors for his "referral".

Isn't this somewhat akin to how some fund manager charges a "wrap fee"? We all know how that goes.

Fee based planning approach sounds ideal, but not when it is an additional layer. I guess such models are still in its infancy and will slowly evolve to be more palatable over time.

Not vested. Your opinion may vary.

[redcorolla95]

Precisely.

If the median Singaporean is about 37 years old, and the lifetime income is about $1-1.5m (estimated by some NUS property professors in 2008). So a max fee of $6k works out to about less than 0.6% of that, and then if it's a 2 income household then 0.3%. Of course we can't save / invest all our income, but even we we save only 10% and spread out the investments over 30 years, it's still a tiny fee compared to what we pay our fund managers, brokers, private bankers, etc.

“If you think education is expensive, try ignorance”
ex-Harvard President

[chang]

Mind if I ask, how young you are? =)

a few more years to 50.

[flinger]

Mind if I ask, how young you are? =)

a few more years to 50.

So you're in your 40's , but you sound like you are in your 60's ....heh

[thefarside]

for me, i diy and keep it real simple.
insurance, no term, hospital, life or whatever except the medishield from cpf. i decided if one day i can't afford medical fee, i will just let nature take its way on me.
for investment, 100% of my fund are in companies under SGX. in fact 90% are in just a few companies. that's all about my investment.
retirement planning, already retired few years ago. just need to watch the expenses.
estate planning, there is intestate law to take care of this.

Based on your approach, in the event that you come down with something, just be sure not to linger around.

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The other side of your question you are wondering about( if i am not wrong) is whether FPs are worth their salt. They have different charging structures ( wilfred for eg is per hour, whilst some are annual fee etc) and obviously depends on the specific FP that you meet. So its really a difficult question to give a proper response. I would suggest that given your particular situation - since u already have a plan - u can set up a obligation free meeting with any of those financial planners and see how their advice fit against yours. There is no fee involved unless you choose Wilfred's type of set up. Just make sure you choose one of this independent planners, not those that are tied to a specific company.

To be honest, I have done a number of these free "no-obligations" planners (six of them since the beginning of time) and have yet to come across one who is not a time waster. All of them were only interested to push products to me after the "review", which will inevitably be some form of insurance (usually life or ILP) or sell me various products to secure my daughter's university education funds etc etc. Usually they will light up upon seeing my household income, and the chat will then start on the various kangtaos they have to introduce to me from their companies. Nowadays, I no longer have the luxury of time to "try" them out, nor the inclination to do so.

In any case, thanks for the many replies so far, as its interesting to see different points of view on this. Cheers.

[mikh]

for me, i diy and keep it real simple.

Based on your approach, in the event that you come down with something, just be sure not to linger around.

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Scientifically speaking, the cruel natural ending is that some or other body part will always break down first, and another next. So until something fatal comes along, the continuing need for support could be a bottomless pit - never enough

[chang]

So you're in your 40's , but you sound like you are in your 60's ....heh

..... i think u maybe correct. i always think of 60's even before i started work. already formed is an image of an old man eating porridge with 2 simple dishes under dim light ....

[hillandfate]

For most people, DIY is actually very easy for Insurance. Term Insurance, H&S and whatever the govt CPF 'forced' me to buy in CPF.