As you may be aware, there are several guidelines and benchmarks to determine whether you are adequately insured, and/or whether you are on track to reach your financial goals. However, such generic guidelines fail to take into account your unique circumstances. To illustrate, if you are debt-free with no dependants, then what’s the point of insuring yourself for 10x annual income in the event of pre-mature death? As a result, if you follow through such guidelines without a proper analysis, then you will most likely be overpaying for insurance policies that you do not need.

As the saying goes, there are no free lunches in this world; and the same statement can be said for tailor-made financial advice. This is because considerable amount of effort and time is required to understand your needs accurately, analyse through your information thoroughly, brainstorm and debate on possible solutions, and to perform a stress test and review on the planning outcome. If you rely on a sales-based model to carry out these tedious tasks for you, then there is a possibility that you will fall into the following sales trap.

In the sales industry, there is a popular 10-3-1 sales formula. To explain, for every 10 calls that an agent makes, the agent is expected to secure at least 3 appointments. Next, out of the 3 appointments that the agent conducts, the agent is expected to make at least 1 sale. By and large, we ought to expect that 1 sale to cover the entire cost of conducting the 3 free appointments and the 10 calls that the agent has made earlier. Otherwise, if the agent continues to conduct free appointments and to do free work, then this is not going to be financially viable for the agent.

Therefore, there is an inevitable pressure on the agent to sell more and/or larger size premium products in order to cover his cost. As you would most probably agree, you won’t want to be that person who falls into the agent’s sales trap.

As a matter of fact, an agent from a tied-distribution channel is able to propose products and services from that particular one insurer only. Consequently, this raises many eyebrows on whether that distributor is able to provide the best types of insurance policy in every single category. If so, won’t the market forces eliminate the other distributors already? If not, for the same dollar that you are paying, why do you want to shortchange yourself?

Given that limitation, there are many Financial Advisory (FA) firms which are able to distribute products and services from multiple insurers. However, it is important to realise one clear distinction between these FA firms from one that is independent.

According to one of the guidelines from MAS (FAA-G05) on the use of the term “Independent” by Financial Advisers,

“Only financial advisers which can clearly demonstrate that they do not have financial or commercial links with product providers that are capable of influencing their recommendations should use the term “independent”.”

Correspondingly, through an Independent Financial Advisory (IFA) firm, we strive to minimise conflict of interest by adhering to the strict regulations set forth by MAS. Therefore, you can be assured that my firm and I are strong advocates towards impartial financial advice and to provide you with a fair dealing outcome.

Accordingly, in order to minimise conflict of interest and remove the inherent pressure to sell you products that you do not need, I set up a fee-based financial advisory practice. To this end, rather than to rely on a product sale to cover the cost of working for you (and for the other clients who didn’t purchase a product), I’m able to be fairly remunerated for the work that I do for you.

By and large, the upfront fee that you pay correlates with the complexity of the work that I need to do for you. As a result, there is never a need for me to propose unsuitable products so that I can cover the cost of my effort and time to work for you (or for the other clients). Now, I can be honest to say that I really work for you!

Given that everyone’s situation is unique, there isn’t a one-size-fits-all model for everyone. As a matter of fact, if your needs are simple, then you should not be paying a fee. Nevertheless, here are some groups of client who engage my service; i.e. those who

1. Requires honest and independent advice that is free from any conflict of interest from any particular insurer or platform;
2. Needs a comprehensive review of their existing insurance portfolio, and to vet through their insurance policy contract;
3. Wants to gain clarity on their finances and to learn how to optimise their assets and cash flow;
4. Prefers to have a deep analysis and comparison across multiple insurers and insurance policies to make an informed decision;
5. Requires careful data-driven planning to work towards their financial goals like retirement.

If you belong to any of the abovementioned categories or is curious to learn more about how I work with my clients, then I would invite you to get in touch with me. As always, I do not charge for the first consultation.

I work with over 150 business partners to provide you with effective and affordable conflict-free solutions.