Securing The Future

This article just came out in today's The Star newspaper, 7th June 2012 written by Elaine Dong. I guess all women should take advantage and read this good piece of work on managing their finances. Happy reading!!!

Teaching women how to manage their finances

 

Women usually take the lead in managing their family finances, and it’s important they learn how to make money work for them.

MEN have often jokingly (and some seriously) referred to their wives as the Home Minister and Finance Minister. It turns out there’s more truth in that statement than mirth.

At the recent Women and Money Asia Convention in Kuala Lumpur, the role of the woman as custodian and manager of a household’s finances was the focus of much discussion.

Often, by default, financial responsibility falls on a woman’s shoulder, whether she is the sole breadwinner, equally contributing to a two-income family or not working. By financial responsibility, we don’t just mean the earning of income, but the planning of how it is to be used, saved and invested.

Dr Jeffrey Chiew, the chairman of the International Association of Registered Financial Consultants, international speaker and published author, weighs in on some practical tips for women.

“There are four basic areas that a woman must look at. She should set aside an emergency fund (three to six months of income), put in place a family income protection plan (through insurance products), have education funding if she has kids, and make sure there is adequate medical insurance for the family,” he says.

Beyond this, the next step is to put in place a will (if there are children involved) and a retirement plan for herself and spouse.

According to Dr Chiew, women need to be aware of the different types of financial goals.

High priority goals are related to children’s education, retirement funding, family income protection, medical coverage and long term care.

Low priority goals are when you aim to go for holidays abroad three times a year, or play golf three times a week.

Entrepreneural goals are what you intend to do to keep yourself occupied for the next 20 years of your life, such as setting up a business, or investing in a startup and more.

“While all three categories are important, financial independence is basically meeting all your high priority goals. This takes precedence over your low priority goals,” he says.

“Once you identify your high priority goals, work aggressively at saving in instruments that have elements of compulsion or semi-compulsion. EPF is an instrument of compulsion by law. Life insurance, investment-linked, and properties have an element of semi-compulsion by having a damper on early withdrawals.

“Products that have elements of compulsion and semi-compulsion are good instruments for medium to long term investments. Bank accounts and quick liquidity products are not so effective as saving products to meet your medium and long term goals,” he says.

A lot of times, we hear people around us saying that they don’t have any savings. Dr Chiew attributes this to poor discipline, and as such, the products that have an element of compulsion as mentioned above would be good to start with.

Once you have consciously and actively put aside enough funds for your high priority goals, you are on the right path to financial independence. You can then start to think about investing and making your money work for you. For this, you would need to know the four types of money and what to expect from each.

In his book, The Millionaire Formula, Dr Chiew highlights four money types that you have to be aware of. The first is serious money, the kind reserved for education funds, medical funds, retirement funds and so forth.

“For these types of financial goals we don’t need a high return. We just want a fair return. The most important consideration in investment is not the return on your money but the return of your money. A timely return is all important in the above mentioned events. Serious money are for serious needs,” says Dr Chiew.

The second is idle money, which refers to the excess monies in your bank account.

“You need to maintain three to six months of your annual income as an emergency fund. Anything in excess of the six months are idle money and should be invested to give you a higher rate of returns to meet your financial obligations.

“Another kind of idle money is the equity buildup in your house equity. These moneys can be utilised to help in your wealth accumulation process,” he says.

The third is borrowed money. Borrowed money must give you a high rate of return to justify your borrowing. “For example, you borrowed money in the form of overdraft facility to start your business. Your business profits must give a reasonable return to cover your cost of borrowing, and give you a healthy profit to justify it,” he says.

The fourth kind is leverage money, which means using a small amount of money to acquire a large asset through financial leverage. Knowledge and skills are essential in using leverage money. An example is you putting ten percent down to purchase a multi-million dollar property. A high return is required to cover the cost of money leveraged.

Financial planning need not be something intimidating. With the right tools, information and knowledge, you could start carving out a viable plan for you and your family, and set in place a financially secure future.

Source: The Star, 7th June 2012

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Personality Secrets to a Long Life

 

By Kathleen Doheny,

A new study may offer some tips to help you stick around for your 100th birthday.

Try to be optimistic, easygoing, sociable, and conscientious. Don't bottle up your feelings. Suppress the urge to talk ill of others, the new research suggests.

 

That combination of personality factors seems to describe the secrets of living to 100, says researcher Nir Barzilai, PhD, director of the Institute for Aging Research at Albert Einstein College of Medicine in the Bronx, N.Y.

Those findings are among the latest from Barzilai's ongoing Longevity Genes Project.

While Barzilai found that those personality factors offer more clues to longevity, he has a caveat: "Still the No. 1 predictor for being a centenarian is if you have parents who are centenarians."

Even so, he is trying to answer the question: "Are the genes that are longevity genes also personality genes?"

The new research is published in the journal Aging.

Longevity & Personality Study

Living to 100 years old is still rare. About 53,000 people in the U.S., or 0.2% of the population, are 100-plus. However, the number of centenarians has been increasing about 8% a year, Barzilai says.

And that has captured his research interest and that of others around the country. "There are several groups doing studies on centenarians," Barzilai says.

Some research has already suggested that centenarians share particular personality traits.

Among them: being extroverted and agreeable.

Barzilai decided to look more closely at genetically based personality characteristics.

He recruited 243 centenarians. He gave them and their family members questionnaires that asked if they had characteristics such as optimism.

He gauged how easygoing they were, how outgoing, and how much they laughed. He looked at how freely they expressed emotions.

He looked at characteristics like conscientiousness, such as a tendency to be self-disciplined.

He looked at neuroticism, a tendency to express negatives emotions such as anxiety, anger, or guilt.

He compared their scores to averages found in the U.S. population.

He also did a validation study to reduce the impact of any mental impairment. Nineteen centenarians and 26 of their children participated in the validation study.

In general, he found those who live to 100:

• Are outgoing
• Are positive -- not the type to talk ill of others
• Laugh often
• Express emotions
• Are conscientious
• Are not neurotic

The link he found is just that, Barzilai says. "It doesn't mean there is a cause-and-effect relationship."

One problem, he says, is they don't have -- and can't have -- a comparison group. "Their friends died years ago, and younger people won't work [as a comparison group]," he says.

One surprise? Some of the 100-year-olds, he found out, were not always easygoing and agreeable, he says. He found that out while talking to some of the centenarians' children.

"There is some adaptation with age," he says. "You try to focus on the good things and not on the bad."

"If they are getting hit [with problems]," he says of his centenarians, "they roll with the punches and they smile. When they are healthy and they get to 100, they are very agreeable.''

The easygoing personalities didn't hold across the board. He tells of one woman's daughter who confided that her mother was mean.

Later, her siblings declined to even talk to Barzilai for the study because they had nothing to do with their mother.

Personality & Longevity: Perspective

"I really believe these are some of the mechanisms [of longevity]," says Daniela Jopp, PhD, assistant professor of psychology at Fordham University.

Her own research on centenarians has found some similar links. She reviewed the study findings.

"We know personality has a strong genetic background," she says. Those who live to 100, Jopp says, "seem to have a very special psychological makeup."

Those who age successfully adjust their expectations about health, she has found. They accept a few aches and pains, she says. They don't focus on complaints, such as having trouble sleeping.

Based on her work and that of others, Jopp says for now she can give this advice to those who want to make it to 100: "Don't get too stressed out," she says.

"People who are optimistic and look positively into the future have not only a better time, but it may help them live longer," she says.

In her research, she finds those living to 100 tend to be well aware of their limited life expectancy, but to continue to make plans anyway.

Source: WebMD Health News

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What Is An Entrepreneur? Are You One?

by Peter Cohan,

Contributor who writes about startups and political economy.

I am not sure what an entrepreneur is. But it’s not for lack of trying to figure it out.

After all, some might say I am an entrepreneur and should know what they are. How so? Since 1994, I’ve run my own high-tech strategy consulting and venture capital firm. Since 2002, I’ve taught at America’s top-ranked undergraduate entrepreneurship school, Babson College. And I have interviewed over 150 start-up CEOs for my forthcoming book, Hungry Start-up Strategy.

You could use a crisp definition to help you figure out whether you are an entrepreneur. So why is it so hard for me to provide that crisp definition?

Here are three questions that lead to my confusion:

• Is entrepreneurship innate or can it be taught? It seems to me that answer may be both. Babson College does not admit everyone who applies. It picks people who have demonstrated by the time they apply, that they’ve done things that demonstrate entrepreneurial potential. I’d guess those include the desire and ability to start and lead an organization, relentless curiosity, an unwillingness to accept conventional wisdom, and discomfort with the political dynamics of a big company.

• Is entrepreneurship something that happens in small companies or in both large and small? Entrepreneurship obviously happens when someone starts a new company. But many people do entrepreneurial things in big companies and then run start-ups after their founders depart.

• Do entrepreneurs need college and work experience before launching a venture? There are well-known cases of people who dropped out of college and turned out to be successful entrepreneurs — Bill Gates, Steve Jobs, and Mark Zuckerberg come to mind here. But for many entrepreneurs, 10 years of experience helps them develop networks and find a problem within an industry that they believe they can solve better than anyone else.

The ultimate test of whether you are an entrepreneur is how you feel when you are doing entrepreneurial activities. If those activities make you happier than if you are working in a clearly-defined role as an employee of a large organization, then you are an entrepreneur.

Before getting into the details of those activities, though, let’s define entrepreneurial success. If that means making a bundle of money so you can play golf or sail, then entrepreneurship can certainly get you there.

But my own perspective — reinforced by interviewing them – is that start-up CEOs have a hunger to solve problems that they find meaningful. And if they are working hard on those problems, they are happy and feel successful.

So what do entrepreneurs do exactly? In the simplest terms, they see opportunity and seize it. If they can see that opportunity and grab the lion’s share before competitors do, then they are likely to become successful in both senses I described above.

More concretely, entrepreneurs build products and the organizations needed to link those products to people who will pay for them. In order to do this, entrepreneurs must be right about six critical choices:

• Setting goals;
• Picking markets;
• Raising capital;
• Building teams;
• Gaining market share; and
• Adapting to change.

If you are already in an entrepreneurial role, you know whether you are good at this and whether it makes you happy. But if you are not doing start-up work now, how do you know whether you should be doing it?

One way to look at this is from the perspective of whether a venture capitalist would invest in you. To that end, I interviewed about a dozen of them. And I’d distill their perspective down to considering whether your prior experience would enable you to make the case for affirmative answers to these five questions:

• ­Do you have superior industry knowledge and a compelling vision for your start-up’s future?
• ­Do you have a winning track record and the passion to keep winning?
• Are you smart, curious, and a doer of frugal, fast experiments?
• Can you identify and manage business risk?
• Do you have charisma, integrity, and the ability to attract, hire and motivate top talent?

If you can convince a venture capitalist that the answer to all these questions is Yes, then you’re an entrepreneur. If not, maybe you should stick with your current job.

 

 

Source:  Forbes Online Magazine

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More Youth Want Insurance

by Liz Lee, The Star, dated 10th August 2011

Poll shows more Malaysians aged 20 to 40 plan to buy policies soon

Insurance companies can expect healthy demand from the 20 to 40-year-old crowd in Malaysia as 60% of this group are planning to buy life or health insurance products in the next 12 months, according to a survey by Swiss Re Ltd.

 

In the study covering 13,800 people in 11 major Asia-Pacific cities, Swiss Re found that 20 to 40-year-old Malaysians are more worried about medical bills, with 60% concerned about getting a serious illness and 57% the inability to pay for long-term medical expenses.

They also tend to underestimate their life expectancy by 15 years when comparing their self-perceived average life expectancy to the official average life expectancy of 75 years old.

The perception gap was the largest in the Asia-Pacific, suggesting a significant longevity risk.

“This large perception gap should ring an alarm bell, as underestimating life expectancy can be a risk in the sense that people may not plan sufficiently to meet their financial needs after retirement,” said Swiss Re Malaysia head and director of reinsurance client markets, Eric Gan.

The study showed that 61% of respondents in Malaysia are concerned about the amount they have to pay for medical expenses relating to major illness, while 62% are concerned that their medical or health insurance premium will increase beyond their affordability in the future.

Gan added that “both the public and private sectors must act together to ensure that living longer remains a benefit to society, rather than a financial burden.

“In particular, the insurance industry can play a key role in raising public awareness of longevity risks and the importance of personal financial planning at an early age, as well as in offering suitable products and services for tackling the challenge”.

Most Malaysians also prefer to buy insurance through insurance agents (81%) and banks (31%) as financial soundness, reputation and value for money are ranked most important when considering an insurance company.

In addition to that, the study noted that only a small portion of Muslim respondents in Malaysia and Indonesia have bought Islamic insurance products.

The study said that “an overwhelming majority of the respondents either do not know or have limited knowledge of (Islamic insurance) products”, indicating consumer education is clearly needed.

The survey also found that the Malaysian group is generally more risk averse compared to their Asia-Pacific counterparts, including Singapore.

Gan said: “Compared to their Asia-Pacific peers, Malaysia's 20 to 40 year olds are less willing to take risks on their health and career, and more willing to take risks on their lifestyle.”

The survey titled Swiss Re Survey of Risk Appetite and Insurance: Asia-Pacific 2011.

It was conducted in April and May in Australia, Singapore, South Korea, Taiwan, China, India, Indonesia, Vietnam and Malaysia.

Source: The Star, dated 10th August 2011


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Get the life you really want

 by Jessica See, a certified professional coach and trainer with Image Coach International.

Turn your professional crisis into an opportunity to reassess your priorities

SOMETIMES, I get calls from clients who have lost or are about to lose their jobs. The prospect of being cast out from a job they thought they could count on for a livelihood is frightening.

Some of them are in the denial stage, where they cannot believe this is happening to them. Others may have moved on to anger and depression. Many are foreigners: for them, losing their jobs also means they have to move back to their home country with their families. Some feel they have lost their corporate identity and self-worth.

Are you in the same situation of having been retrenched or are at a crossroads in your career or professional life? Here are some suggestions on how to get out of it:

Acknowledge the crisis

Losing a job can create as much emotional turmoil as losing a loved one. You may go through the different stages of loss before acceptance comes.

I know a 45-year-old man, Mr A, who went through these stages recently, after losing his high-paying job of 15 years. Initially, he refused to accept that he was now facing a professional crisis.

He dismissed the whole situation as “just a bad patch” that he was going through, blaming it all on an “incompetent boss”. He was confident that his ex-boss would soon be begging him to rejoin the company.

Two months later, when it finally dawned on him that his ex-boss was not going to call him back, he became consumed with anger and hurt. He started bad-mouthing his former employer and told everyone he had resigned because of the company’s unethical practices.

When he first came to me, he was already in the depression stage. He could not understand why he, of all the staff in the organisation, was let go. Was it because he was too frank and not adept at politicking? Was it some inadequacy on his part?

I told him that the first step towards moving forward was to acknowledge that he was indeed facing a crisis in his life. He was now 45, and it is a fact that many potential employers would prefer younger candidates to fill their job vacancies.

Once Mr A acknowledged that he was facing a professional crisis, he could then choose how to respond.

Explore your options

I have always loved the way the Chinese express the word “crisis”. The Chinese character for “crisis” actually comprises two characters — one that means “danger” and the other, “opportunity”.

The word “crisis” can be defined as a time of intense difficulty or danger and a “turning point” for better or worse. Its origin is the Greek word krisis which means “decision”.

Whichever way you choose to look at it, one unifying theme defines the experience. A crisis serves as a wake-up call to alert you to both danger (and turmoil) as well as opportunities that can lead to greater things in life. The outcome depends on the choices and decisions you make.

So take a job crisis as a wonderful opportunity to step back and detach yourself from the situation, take a fresh look at what you really want in your life and then make the move forward to achieve the life you deserve!

Find your passion

How many people really take the time  to explore what is their true passion and purpose? Very few, I believe.

Most of us just tend to flow along the path of least resistance — from school to college to job after job — with very little thought given to what we really want to achieve in our lives until it is probably too late.

So, count your blessings when you receive a wake-up call. Take it as an opportunity to stop the auto-drive mode you are in and explore and discover your purpose and passion.

Reflect on the following questions:

- Do you feel good about yourself, your life, and where you are going?

- If time and money are not a problem, what would you be doing on a daily basis?

- What do you really want for your life? What don’t you want? What have you settled for?

- Do you feel fulfilled and satisfied with your life choices so far? If not, what would you change if you could?

Whether or not you are experiencing a professional crisis right now, step back and re-assess where life is leading you.

If you discover that you have been sacrificing meaning, fulfilment, balance and happiness in life for the outward trappings of “career success”, it is time to regain control of the life you really want.

Source: The Star, dated 6th June 2012

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You can learn to be optimistic

By Jane E. Brody

Published in: Health

The definition of an optimist:

Someone, like me, who plans to get more done than time permits.

Or, having failed to achieve the impossible, someone, like me, who is sure everything will somehow get done anyway.

A more classical definition from the Mayo Clinic: “Optimism is the belief that good things will happen to you and that negative events are temporary setbacks to be overcome.”

In one study, adults shown to be pessimists based on psychological tests had higher death rates over a 30-year period than those who were shown optimistic. No doubt, the optimists were healthier because they were more inclined to take good care of themselves.

Unlike Voltaire’s Candide, I’ve yet to be stripped of my optimism, although there are clearly forces in this country and the world that could subdue even the most ardent optimist.

I am a realist, after all, and I do fret over things I may be able to do little or nothing about directly: economic injustice; wars and the repeated failure to learn from history. But I’ve found that life is a lot more pleasant when one looks at the bright side, seeing the glass half full and assuming that reason will eventually prevail.

Not just about being positive

Murphy’s Law – “Anything that can go wrong will go wrong” – is the antithesis of optimism. In a book called “Breaking Murphy’s Law,” Suzanne C. Segerstrom, a professor of psychology at the University of Kentucky, explained that optimism is not about being positive so much as it is about being motivated and persistent.

Segerstrom and other researchers have found that rather than giving up and walking away from difficult situations, optimists attack problems head-on. They plan a course of action, getting advice from others and staying focused on solutions. Whenever my husband, a dyed-in-the-wool pessimist, said, “It can’t be done,” I would seek a different approach and try harder – although I occasionally had to admit he was right.

Segerstrom wrote that when faced with uncontrollable stressors, optimists tend to react by building “existential resources” – for example, by looking for something good to come out of the situation or using the event to grow as a person in a positive way.

I was 16 when my mother died of cancer. Rather than dwell on the terrible void her death left in my life, I managed to gain value from the experience. I learned to apply her lifelong frugality more constructively, living each day as if it could be my last, but with a focus on the future in case it wasn’t.

And I adopted a very forthright approach to life, believing that if I wanted something badly enough, I could probably overcome the odds against me.

When I applied at age 24 for a job as a science writer at The New York Times, an interviewer said I was foolhardy to think I could be hired after just two years of newspaper experience.

“If I didn’t think I could do the job, I wouldn’t be here,” I told him.

It was just what he wanted to hear, and I was hired.

Learned optimism

Research has indicated that a propensity toward optimism is strongly influenced by genes, most likely ones that govern neurotransmitters in the brain. Still, the way someone is raised undoubtedly plays a role, too.

• Parents who bolster children’s self-esteem by avoiding criticism and praising accomplishments, however meager, can encourage in them a lifelong can-do attitude.

• With the right guidance, many attributes of optimism also can be learned by adults, Segerstrom and other researchers have found.

Noting that it is easier to change behavior than emotions, she avoids the popular saying “Don’t worry, be happy.” Instead, she endorses a form of cognitive behavioral therapy: Act first and the right feelings will follow. As she puts it in her book, “Fake it until you make it.”

She wrote, “People can learn to be more optimistic by acting as if they were more optimistic,” which means “being more engaged with and persistent in the pursuit of goals.”

If you behave more optimistically, you will be likely to keep trying instead of giving up after an initial failure.

“You might succeed more than you expected,” she wrote.

Even if the additional effort is not successful, it can serve as a positive learning experience, suggesting a different way to approach a similar problem the next time.

Framing Your Thoughts

It's important not to neglect the power of positive thinking. Both Segerstrom and the Mayo researchers recommend taking a few minutes at the end of each day to write down three positive things that happened that day, ending the day on an upbeat note.

The Mayo researchers offered these additional suggestions:

Avoid negative self-talk. Instead of focusing on prospects of failure, dwell on the positive aspects of a situation.

In college, I would approach every exam, even those I had barely studied for, with the thought that I was going to do well. Time after time, this turned out to be a self-fulfilling prophecy.

Regardless of the nature of your work, identify some aspect of it that is personally fulfilling. If your job is scrubbing floors, stand back and admire how shiny and clean they look.

Surround yourself with positive, upbeat people. But be aware that if you are chronically negative and always see only the dark side of things, the optimists in your life may eventually give up on you.

Focus on situations that you can control, and forget those you can't. I would also suggest using voting power, money or communication skills to forward a goal that is beyond your personal control.

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Smart About Money

Recently I came across with an article from The Star newspaper, dated 5th June 2012 at Metrobiz section. It was written by Joy Lee which really taught us on how to choose a certified financial planner. I believe it will be beneficial and knowledgable article for everyone who have no ideas at all who to approach or intend to start doing financial planning for their own with the help of an advisor.

FINANCIAL planning is relatively new in Malaysia. And not many would know of the existence of financial advisors, what more their function.

But there is increasing awareness of the need for financial planning today and more consumers are looking at the option of engaging services of financial advisors.

And Yap Ming Hui, managing director of Whitman Independent Advisors, has taken it upon himself to do his part in raising awareness on the importance of independent financial advisors.

According to Yap, the main differences between an independent financial advisor and most financial advisors in Malaysia, is that independent financial advisors are not attached to any particular financial institutions and are not required to sell specific products from their firms.

For example, a financial advisor can be attached to an insurance company and mainly advises clients on the benefits of insurance products alone and at the same time may need to meet a certain sales target.

Independent financial advisors, on the other hand, provide fee-based consultation on a client’s financial position and goals, and identify the gaps to fulfil those goals.

“From there, we help the person take the right strategy, either to cut some expenses, invest more, get insurance and things like that to help that person move towards financial freedom,” said Yap.

Whitman is among the pioneers in the local independent financial advisory front.

The firm currently serves a clientele of 100 people with combined client assets under management totalling RM950mil.

About 30% of Whitman’s client base are high net-worth individuals while the remaining are middle-class earners.

High net-worth individuals are clients with more than RM2mil worth of funds to manage.

Yap, who was previously in the life insurance sector, is passionate about his field of work.

“I never saw myself as a good businessman. I can’t just sell and sell.

“I like analysing clients and coming up with solutions rather than shove products down their throats. I foresee that I can make a lot of difference. This is what I love doing,” he said.

He attended a seminar on financial planning in 1997 and learnt about the blossoming trade in Australia, which inspired him to look into the prospects of independent financial advisory in Malaysia.

He then signed up for a chartered financial consultant course and there was no looking back for Yap.

Whitman commenced business in 2000 with a start-up capital of about RM200,000. However, it was a very new industry then and business was slow.

Additionally, Yap noted that there was no infrastructure for the advisory business to flourish and they did not fully understand the business.

But things have improved since then and Whitman generated revenue of about RM1.5mil last year compared to about RM600,000 in 2009.

Half of Whitman’s revenue is generated from consultation fees while the other half is from investment commissions.

“It is a lucrative business because it is a recurring business. If you are good, clients will stay with you for years,” said Yap.

Untapped market

There are tremendous opportunities in the independent financial advisory field as the industry is only in its infancy stage.

According to Yap, less than one per cent of the population are aware of the services offered by independent financial advisors despite the fact that consumers are getting more educated these days.

However, as consumers come out of the difficult economic climate, they will be more inclined to seek out the services of financial advisors.

“I would like to believe that the market can grow quite significantly. But we need to educate consumers on why independent financial advice is important,” he said.

Most people do not find financial planning sexy but Yap said it is important to look into it in order to achieve financial freedom.

“People think they have to do it on their own. But investment products are getting very complicated these days and consumers lack the time to look into every detail,” he noted.

In developed countries such as the United States and Australia, the financial planning and advice market is estimated to be worth some US$47bil (RM150bil) and US$4bil (RM13bil) respectively.

Market research showed that the financial planning and advice industry is growing at an annual rate of 1.8% in the US.

In Malaysia, independent financial advisory is only a small subset of the financial services industry.

Yap noted that after 2009, the market was more ready for independent financial planning services as regulations and basic infrastructure were more in place.

Independent financial advisors in Malaysia will need to obtain licences from the Securities Commission and Bank Negara Malaysia.

“Competition is too small to be noticed at the moment. We are at a stage where competitors are not an issue,” said Yap.

He welcomes more players into the industry as he feels that this will help develop the market faster which in turn will benefit everyone.

There have been various public awareness programmes in place by relevant authorities to promote financial planning in Malaysia.

But Yap said a lot of the education done among consumers gets discounted by claims from various financial advisors on their services.

“This resulted in confusion among the public on what we actually do,” he said.

Another misconception about independent financial advisory is that they charge a high fee, which Yap says is not true.

Whitman charges an annual fee of RM1,800 for regular clients and an annual fee of RM5,000 for high net-worth clients, which Yap feels is affordable.

Whitman also takes a small commission for investment it makes for its clients.

One of the factors that will boost the independent financial advisory market is to enforce a compensation structure that is conducive for service-based advisory rather than product-based advisory.

Yap adds that independent financial advisors must be able to visualise a business model that prioritises clients’ financial success.

"Only then, your own business success will come about. You don't have to shortchange your clients to earn lots of profits. For too long, we have always gone on a we-win-client-lose model but we should be able to move towards a win-win model with our clients," he said.

Metrobiz, The Star, 5th June 2012

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