Let me explain this statement.
To me, paying an insurance premium is like putting money into a “protection account”. An account that you may not be able to see, but it is there for you when you need it the most.
Example 1:
Mr X pay $2,000 insurance premium a year.
In Mr X “protection account”, he would have:
-$2,000,000 life coverage.
-$2,000,000 disability coverage.
-$500,000 yearly medical coverage.
Over 20 years, he would have paid $40,000 in premium but he have millions of dollar in his “protection account” that he can access in times of need.
Example 2:
Mr Y set aside $2,000 a year into an emergency account in the bank.
So if something happened, Mr Y can take money from this account to pay let say medical bill.
Imagine for the next 20 years nothing happened, he would have accumulated $40,000 + small interest from the bank. So maybe this money look big to you, maybe not. But no matter what, he can't use the money. Because it's in the emergency account, he can't spend it for leisure. If he use it, then he won't have money in times of need.
Now think really hard, which person is in a better financial position as a whole? Mr X or Mr Y?
If something unfortunate happened in the 20th year, Mr X has millions of dollar that he can access while Mr Y only can have his $40,000.
What if something happens in the 2nd year? Mr X has millions of dollar that he can access while Mr Y only have $2,000.
To me, Mr Y did not do a good planning with his money. He did not use his money to the fullest. He did not leverage it. Even though he has that cash in the emergency account, he is in a worse position financially than Mr X.
So who do you want to follow? Mr X or Mr Y. You choose.
Cheers! Have a great day.
Labels:
Insurance Talk
2011 Singapore nationwide protection survey
Insurance company AIA Singapore just recently did a protection survey. It shows a very interesting result about people and their perception and action towards protection. I am quite shocked and surprised.
Lets take a look at some of the findings. Some figures are rounded by me.
For the full survey result, please visit http://www.aia.com.sg/en/resources/ffef9500480ceb16bd7dbdf239f692a9/press-release-2011-Nationwide-Protection-Survey.pdf
1. 6 in 10 people claim to have a clear idea of how much they have to set aside for their dependants should something happen to them. But only 1 in 10 people is adequately insured.
2. 4 in 10 people expect their dependants to downgrade their current living standards should anything unexpected happen to them and they believe that it is fine for them to do so.
3. 1 in 2 people believe that it is acceptable that their spouse to remarry to make up for loss of income.
4. 1 in 4 who currently do not have any life insurance believe that life insurance is expensive and they can't afford the premium. Interestingly, they are willing to spend on vacation, meals at upscale restaurant, entertainment, electronic gadgets and beauty treatments.
5. 1 in 4 has yet to take the step of reviewing their financial protection needs with their spouse.
What do you think? Does the result surprised you as well?
Do you agree with the statements? What will be your answers if you are the survey participant?
To me, some of the answers just reflect how irresponsible some people are. I truly believe that if you are a provider for your family, you must plan and make sure that you have adequate protection. I will not want my family to downgrade their life if something happens to me. I will not want my spouse to remarry just for the money to support their life. I will want to make sure they can live without financial difficulty.
Cheers! Have a great day.
Lets take a look at some of the findings. Some figures are rounded by me.
For the full survey result, please visit http://www.aia.com.sg/en/resources/ffef9500480ceb16bd7dbdf239f692a9/press-release-2011-Nationwide-Protection-Survey.pdf
1. 6 in 10 people claim to have a clear idea of how much they have to set aside for their dependants should something happen to them. But only 1 in 10 people is adequately insured.
2. 4 in 10 people expect their dependants to downgrade their current living standards should anything unexpected happen to them and they believe that it is fine for them to do so.
3. 1 in 2 people believe that it is acceptable that their spouse to remarry to make up for loss of income.
4. 1 in 4 who currently do not have any life insurance believe that life insurance is expensive and they can't afford the premium. Interestingly, they are willing to spend on vacation, meals at upscale restaurant, entertainment, electronic gadgets and beauty treatments.
5. 1 in 4 has yet to take the step of reviewing their financial protection needs with their spouse.
What do you think? Does the result surprised you as well?
Do you agree with the statements? What will be your answers if you are the survey participant?
To me, some of the answers just reflect how irresponsible some people are. I truly believe that if you are a provider for your family, you must plan and make sure that you have adequate protection. I will not want my family to downgrade their life if something happens to me. I will not want my spouse to remarry just for the money to support their life. I will want to make sure they can live without financial difficulty.
Cheers! Have a great day.
Labels:
Medical
Hefty hospital bills
I live in Singapore, a country where the life expectancy is at number 15 in the world. Males are expected to live till age 78 and females till age 82. It sounds really good.
But as you know, when people grow older and live longer, people tend to get sick more often. In Singapore, the hospital admission rates is about 100 per 1000 resident population.
So there is 1 in 10 chance of people being hospitalized in any time of the year.
Is the risk low? maybe. But I will not take chances. Because if you are that 1 person that is hospitalized, the bills can be really huge. It may wipe out your savings.
Let me share with you 2 news article.
This is a $300,000 hospital bill.
This is a $147,000 hospital bill.
Of course there are many more medical bills like this and even bigger amount, it's just that it was never mention in the news.
From my own personal experiences, for critical illness, the bill can go up to $300,000. For serious illness, the bill can go up to $100,000. While for minor illness, it may set you back up to $30,000.
If you are still healthy, don't take it for granted. Get a medical insurance while you can, so you can be sure that your hard earned saving is protected.
If you do not have millions of dollars in the bank, it is a must that you have medical insurance. Because if you don't have, even 1 hospital bill can really wipe out your saving. Even worse, you don't have enough money to pay the bill.
Do you know that in many countries, the leading cause of filing for bankruptcy is individual illness and the related medical bills that accompany the illness? It's true.
Cheers! Have a great day.
But as you know, when people grow older and live longer, people tend to get sick more often. In Singapore, the hospital admission rates is about 100 per 1000 resident population.
So there is 1 in 10 chance of people being hospitalized in any time of the year.
Is the risk low? maybe. But I will not take chances. Because if you are that 1 person that is hospitalized, the bills can be really huge. It may wipe out your savings.
Let me share with you 2 news article.
This is a $300,000 hospital bill.
This is a $147,000 hospital bill.
Of course there are many more medical bills like this and even bigger amount, it's just that it was never mention in the news.
From my own personal experiences, for critical illness, the bill can go up to $300,000. For serious illness, the bill can go up to $100,000. While for minor illness, it may set you back up to $30,000.
If you are still healthy, don't take it for granted. Get a medical insurance while you can, so you can be sure that your hard earned saving is protected.
If you do not have millions of dollars in the bank, it is a must that you have medical insurance. Because if you don't have, even 1 hospital bill can really wipe out your saving. Even worse, you don't have enough money to pay the bill.
Do you know that in many countries, the leading cause of filing for bankruptcy is individual illness and the related medical bills that accompany the illness? It's true.
Cheers! Have a great day.
Labels:
Disability
$1 million for disabled worker
As you can see from the article, this construction worker was awarded $1 million for the accident that happened. That sum is to cover his loss of future earnings.
You may not know, but the average salary of a construction worker is about $1,000 to $1,500 monthly.
If he was awarded $1 million, how much do you think your disability coverage should be?
Do not under-estimate your future economic worth. If you are earning $50,000 a year now, you would have accumulate $1 million in 20 years. That is not including bonuses and pay rise over the years. Can you imagine if suddenly you are disabled? how much do you lose in your future earnings?
You are worth more thank you think.
Cheers! Have a great day.
Labels:
Insurance Talk
How much coverage should you have?
Many people that I encounter does not have adequate protection. Even though they have many policies and pay high premium, most of them are still under-insured.
Why? well it might be because they choose the wrong plan or they under-estimate their future economic worth.
Just as a guidelines, I will share some tips with you about how much you should cover yourself.
Tips:
1. For death and disability coverage, look for at least 10 times your annual income. So if you earned $100,000 a year, you should have at least $1 million coverage.
2. For critical illness coverage, look for at least 3 times of your annual income. So if you earned $100,000 a year, you should have at least $300,000 coverage.
3. For hospital coverage, look for at least $500,000 yearly coverage.
4. For premium, we always advise our clients not to pay more than 10 percent of their annual income. So if you earned $100,000 a year, try not to spend more than $10,000 on insurance. As some insurance plans are a long term commitment. So you have to make sure that you can afford it in the long term.
Of course the above is just a rough guidelines, but it is a good start if you want to plan.
The numbers may look big to some of you, but trust me, when things happen, you will appreciate that you have a big coverage.
Cheers! Have a great day.
Why? well it might be because they choose the wrong plan or they under-estimate their future economic worth.
Just as a guidelines, I will share some tips with you about how much you should cover yourself.
Tips:
1. For death and disability coverage, look for at least 10 times your annual income. So if you earned $100,000 a year, you should have at least $1 million coverage.
2. For critical illness coverage, look for at least 3 times of your annual income. So if you earned $100,000 a year, you should have at least $300,000 coverage.
3. For hospital coverage, look for at least $500,000 yearly coverage.
4. For premium, we always advise our clients not to pay more than 10 percent of their annual income. So if you earned $100,000 a year, try not to spend more than $10,000 on insurance. As some insurance plans are a long term commitment. So you have to make sure that you can afford it in the long term.
Of course the above is just a rough guidelines, but it is a good start if you want to plan.
The numbers may look big to some of you, but trust me, when things happen, you will appreciate that you have a big coverage.
Cheers! Have a great day.
Labels:
Critical Illness
More cancer patients can't afford care
As you know, in this modern times the advancement and progress in the medical field is very fast and the result is looking good. But with that, it comes at a high price for the patient. As research needs money and lots of it! to produce the technology and the medicine to help cure sick patients.
So this is good news for people who can afford it. But bad news for people who are sick but cannot afford it.
Excerpts taken from CBS news:
In the states according to American Association for Cancer Research, more than 1 million cancer survivors are foregoing cancer care because of cost.
"A growing number of cancer deaths directly attributable to lack of adequate insurance to get the care you need is growing with every passing day," said Dr. John Seffrin, CEO of the American Cancer Society.
The total cost of cancer care can range from more than $2,000 to more than $7,000 per patient each month.
"One in five cancer patients will spend virtually all their life savings to get the treatment they need," Seffrin said.
Read the full article at http://www.cbsnews.com/stories/2009/02/05/eveningnews/main4778543.shtml.
This is a real problem, facing many people all over the world. What we can do now is just plan, to make sure that we have adequate coverage. Do not procrastinate, plan now before it is too late.
I believe that when we are sick, the last thing you want to think about is money. With insurance, you can focus on your recovery and getting better.
Do you want to have to make a life and death decisions based on financial consideration? I don't think so. But that is what happening all over the world.
With insurance, you don't have to make that decision.
Cheers! Have a great day.
So this is good news for people who can afford it. But bad news for people who are sick but cannot afford it.
Excerpts taken from CBS news:
In the states according to American Association for Cancer Research, more than 1 million cancer survivors are foregoing cancer care because of cost.
"A growing number of cancer deaths directly attributable to lack of adequate insurance to get the care you need is growing with every passing day," said Dr. John Seffrin, CEO of the American Cancer Society.
The total cost of cancer care can range from more than $2,000 to more than $7,000 per patient each month.
"One in five cancer patients will spend virtually all their life savings to get the treatment they need," Seffrin said.
Read the full article at http://www.cbsnews.com/stories/2009/02/05/eveningnews/main4778543.shtml.
This is a real problem, facing many people all over the world. What we can do now is just plan, to make sure that we have adequate coverage. Do not procrastinate, plan now before it is too late.
I believe that when we are sick, the last thing you want to think about is money. With insurance, you can focus on your recovery and getting better.
Do you want to have to make a life and death decisions based on financial consideration? I don't think so. But that is what happening all over the world.
With insurance, you don't have to make that decision.
Cheers! Have a great day.
Labels:
Critical Illness
Why even healthy people can get cancer?
Many people do not really understand why everybody is at risk from getting cancer.
Statistics shown that 1 in 3 people in Singapore died from cancer. So imagine if you are in a coffee shop, you are eating with 2 of your friends, you know that from statistics 1 of you will get cancer in this life time. The chance is high and it is scary if you think about it.
I found this answer in the internet which may enlightened you about cancer.
Taken from yahoo answer. Thanks to them.
You would think that most people would notice that . . extremely athletic people who are not obese, do not smoke or drink, eat healthy . . well, they still can get cancer despite all their efforts to avoid it . . there is a misconception among the public that cancer is 'caused' by the environment, smoking, obesity, unhealthy lifestyle, or it's genetic. The misconception continues that if they do not smoke, or drink, or take drugs, eat healthy, avoid carcinogens, exercise regularly, that they won't ever get cancer. However, just the fact that babies and children can get cancer should make everyone pause . . most children are well taken care of, fed well, active . . parents do everything right by having regular checkups, avoid carcinogens, feed them vitamin supplements . . and kids still get cancer.
The truth is that no one, not even healthcare providers, know what causes one person or one child to get cancer while another one does not. That is why you can find lung cancer among people who have never smoked a day in their life . . smoking is rotten for you . . but it is not the only factor that causes a person to get lung cancer.
What people should focus on, of course, is the risks . . if you smoke, you have a higher risk of developing cancer and if you do it will be more difficult for you to survive the disease. This is not the same as . . if you smoke you will get cancer. Because that is not true. Same with all other things . . do not drink to excess, smoke to excess, overeat, or do anything to excess because it places you at a higher risk for developing some types of cancer.
Ironically, the medical community and media spend so much time pointing out the risks of smoking and getting lung cancer that they fail to mention you could still develop a bone cancer or leukemia thats totally unrelated to cigarettes.
People should try to stay as healthy as possible, because no one knows who will develop cancer, which type that might develop. By staying healthy and strong people are than in the best position of all to fight cancer should it develop. Prevention and examining your own body for lumps, bumps or anything unusual should become standard practices at a young age. IMHO.
Reference: http://answers.yahoo.com/question/index?qid=20070113113030AAlVKG5
Cheers! Have a great day.
Statistics shown that 1 in 3 people in Singapore died from cancer. So imagine if you are in a coffee shop, you are eating with 2 of your friends, you know that from statistics 1 of you will get cancer in this life time. The chance is high and it is scary if you think about it.
I found this answer in the internet which may enlightened you about cancer.
Taken from yahoo answer. Thanks to them.
You would think that most people would notice that . . extremely athletic people who are not obese, do not smoke or drink, eat healthy . . well, they still can get cancer despite all their efforts to avoid it . . there is a misconception among the public that cancer is 'caused' by the environment, smoking, obesity, unhealthy lifestyle, or it's genetic. The misconception continues that if they do not smoke, or drink, or take drugs, eat healthy, avoid carcinogens, exercise regularly, that they won't ever get cancer. However, just the fact that babies and children can get cancer should make everyone pause . . most children are well taken care of, fed well, active . . parents do everything right by having regular checkups, avoid carcinogens, feed them vitamin supplements . . and kids still get cancer.
The truth is that no one, not even healthcare providers, know what causes one person or one child to get cancer while another one does not. That is why you can find lung cancer among people who have never smoked a day in their life . . smoking is rotten for you . . but it is not the only factor that causes a person to get lung cancer.
What people should focus on, of course, is the risks . . if you smoke, you have a higher risk of developing cancer and if you do it will be more difficult for you to survive the disease. This is not the same as . . if you smoke you will get cancer. Because that is not true. Same with all other things . . do not drink to excess, smoke to excess, overeat, or do anything to excess because it places you at a higher risk for developing some types of cancer.
Ironically, the medical community and media spend so much time pointing out the risks of smoking and getting lung cancer that they fail to mention you could still develop a bone cancer or leukemia thats totally unrelated to cigarettes.
People should try to stay as healthy as possible, because no one knows who will develop cancer, which type that might develop. By staying healthy and strong people are than in the best position of all to fight cancer should it develop. Prevention and examining your own body for lumps, bumps or anything unusual should become standard practices at a young age. IMHO.
Reference: http://answers.yahoo.com/question/index?qid=20070113113030AAlVKG5
Cheers! Have a great day.
Labels:
Insurance Talk
Why do people buy insurance?
To me, insurance is the most powerful financial tool that people ever created.
Without insurance, life is much harder than you think. It's just that many people never think about it, don't want to think about it or they are being ignorant.
Tell me, which other financial instruments can give you let say $1 million for just $500? the answer is none. Only insurance can. That is what I paid for a life and disability coverage.
So here are a few reasons why people buy insurance:
1. It's simply leveraging your money. Like the example above, I only pay $500 and I got $1 million coverage in return. If you put that $500 in the bank, it will remain $500 and if something happens, you only get $500.
2. People know unfortunate things can happen to anyone, anywhere and anytime. Death, disability, critical illness, sickness and accident does not discriminate anyone. It does not matter if you are young or old, healthy or not, rich or poor, it can struck anyone randomly.
3. It's because they love themselves and the people around them. Not many people have millions of dollars in the bank when they just started their life. That is why insurance can give them the huge protection they need. So that if something happens, they will not become a burden, especially financial burden to their loved ones.
4. Peace of mind. Knowing that you are adequately covered will make your life better. You can live your life everyday without worry because you know that the financial future of your self and your family are secured. You don't have to worry about hospital bills if you are sick. You don't have to worry if you can't work because of disability or critical illness. You don't have to worry about your spouse and kids future if you are not around anymore.
So now you know why people plan. Have you plan for your self and your loved ones?
Cheers! Have a great day.
Without insurance, life is much harder than you think. It's just that many people never think about it, don't want to think about it or they are being ignorant.
Tell me, which other financial instruments can give you let say $1 million for just $500? the answer is none. Only insurance can. That is what I paid for a life and disability coverage.
So here are a few reasons why people buy insurance:
1. It's simply leveraging your money. Like the example above, I only pay $500 and I got $1 million coverage in return. If you put that $500 in the bank, it will remain $500 and if something happens, you only get $500.
2. People know unfortunate things can happen to anyone, anywhere and anytime. Death, disability, critical illness, sickness and accident does not discriminate anyone. It does not matter if you are young or old, healthy or not, rich or poor, it can struck anyone randomly.
3. It's because they love themselves and the people around them. Not many people have millions of dollars in the bank when they just started their life. That is why insurance can give them the huge protection they need. So that if something happens, they will not become a burden, especially financial burden to their loved ones.
4. Peace of mind. Knowing that you are adequately covered will make your life better. You can live your life everyday without worry because you know that the financial future of your self and your family are secured. You don't have to worry about hospital bills if you are sick. You don't have to worry if you can't work because of disability or critical illness. You don't have to worry about your spouse and kids future if you are not around anymore.
So now you know why people plan. Have you plan for your self and your loved ones?
Cheers! Have a great day.
Labels:
Insurance Talk
What is insurance planning all about?
Insurance planning is about having adequate protection. When you buy insurance, you enter an agreement with an insurer. This is where you pay a relatively small premium to the insurer and you are covered with a relatively big sum assured. So if anything happens to you, the benefit according to the insurance contract will be paid out to you and your loved ones. You are basically transfering your risks to the insurer.
Yes, insurance plan can also serve as a saving, investment, etc. But the most important thing about insurance is always about the protection!
Many people have many insurance policies, but most of them do not have enough coverage. Why? It is because they are concern more with the savings and investments portion of the insurance plan, rather than the protection amount.
So it is not important how many insurance plans you have, but the amount is.
Now that you know, when you want to start planning, always remember, with the budget that you have, focus on the protection first.
Cheers! Have a great day.
Yes, insurance plan can also serve as a saving, investment, etc. But the most important thing about insurance is always about the protection!
Many people have many insurance policies, but most of them do not have enough coverage. Why? It is because they are concern more with the savings and investments portion of the insurance plan, rather than the protection amount.
So it is not important how many insurance plans you have, but the amount is.
Now that you know, when you want to start planning, always remember, with the budget that you have, focus on the protection first.
Cheers! Have a great day.
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