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15 Feb 2019
Monetary Authority of Singapore
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The harmful financial industry

There are more individuals working in the financial sector than those in the farming industry. Without the latter we all probably be eating grass.

That said, of the thousands of financial companies that purport to have the skills to create wealth or at least preserved wealth for their clients; in reality, I read somewhere, that more than 80% either lose money for their clients or achieve returns that are lower than the stock index.

Either way, whether you lose or make money, the financial houses wins; they have an upfront fee, administrative fee, misc fee, distribution fee, commission fee, performance fee, basic fee and etc. Even before your money gets invested you already in deficit. This also seems to be true for investment link insurance account.

I was appalled when I read the way investment link insurance account works. Eg every month you pay a premium; a small amount goes into insurance while the other goes into investment. Instead of using this deposit to buy units or shares, you have to sell your current holding to buy the equivalent units or shares. Hence, the prohibiting charges. How can an insurance company that always claim to walk with you from cradle to coffin, sucks the daylight out of you.

Some people accuse many of these individuals of greed. I honestly see it differently. Our MAS and politicians keeps drumming into our citizens that no where in the world is as safe as Singapore in investing your money. Everything is scrutinized with no stones unturned.

What do we expect how the retail investors think? To them everything that comes to the market must be safe. So they go for the highest return for their investment. Eventually some get caught. Then the story get recycle again. Our authorities love to issue motherhood statements that carries no meaning but pseudo-comfort but in reality is a death trap.

How long more does intelligent, educated and compassionate Singaporeans want to continue with this way of life?

Rachel Ash


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