Insurance – One of the MUST important financial planning
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If u put bananas and $$ in front of monkeys, monkeys will choose bananas, because monkeys do not know that $$ can buy a lot of bananas. In reality, if you put $$ and health in front of people, people tend to choose $$ because their simple minds often become fixated on chasing instant gratification ( desire to experience pleasure w/o delay).Many people do not know that health can bring more happiness & wealth.
When you are young and healthy you probably won’t even consider your health as important .You never imagine that one day they could get diabetes or cholesterol problems as you neglect your health . Many health problems are also related to stress. Stress will worsen or increase the risk of conditions like obesity, heart disease, diabetes, depression, gastrointestinal problems etc.
So Life & health insurance are one of the most important financial products 100% you must buy as early as possible.
Term or whole life insurance
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Whole Life insurance is to protect the life insured in the event of death. It is a small savings and high protection insurance. It will have a certain cash value.
Some say that for newborn, buying a whole life insurance policy is actually better than buying term insurance.Life insurance IRR (rate at which an investment breaks even in today's dollars ) decreases if you buy at a later age.
Term insurance is pure protection. There is no cash value. It can be used to cover for temporary needs (age 50, 60 or 75 or even till 99) . It is much cheaper than whole life insurance
Some may struggle to pay monthly premiums at a later stage of their working life due to their financial constraint. One should consider buy term insurance (much cheaper).
Health insurance (Govt medishield life)
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Govt medishield life is compulsory .A basic health insurance plan to help with large hospital bills which is based on the costs of Class B2 & C wards .It is paid throught your CPF medisave acct.
Parent (age 87 & 89) Basic medishield life health plan
1. Yealy premium = $615 (Premium b4 subsidies $1.5k)
Our good govt top up $800/yr each to my parents medisave acct. So practically, they don’t have to top up CASH to pay for the medishield life premium of $615/yr.
Integrated plan scheme (IPS) . An Additional private insurance coverage (Rider - come out cash) component run by private insurers, typically to cover Class A/B1 wards in govt or private hospitals. The advantage of IPS private A Class hospital plan is that the waiting time is much reduced .
My family has a comprehensive IPS plan.
1)Me - Has made a claimed est $10k for minor surgery
2)Wife - Has made a claimed est $200
3)Sons - Has made a claimed of $5k due to minor accidents.
Children <18 are up to twice as likely to experience an event leading to a personal accident claim than adults. Singaporeans have a higher chance of getting hospitalised due to these following reasons:
1. Accident, poisoning and violence
2. Cancer
3. heart diseases
4. Intestinal infectious diseases
5. Pneumonia (It is serious upper respiratory infection ).
My older brother has pulmonary edema. His body will struggle to gain oxygen. This is due to the amount of increasing fluid in the lungs preventing oxygen moving into the blood stream. It will grow worse until the doctor removes the fluid. He has been in/out hospital > 10x per year. If he did not have the govt compulsory medishield plan. He would be probably bankrupt in his bank acct.
Critical illness insurance
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It pay out a sum assured when discovered critical illness like Kidney failure, stroke, heart attack etc etc.
If the parents has abnormal copies of gene that will cause major illness at later stage of life. Better buy more critcal illness coverage as early as possible.
1. Bought HDB flat from the owner (age 43 partial blind ).He needed to downgrade to smaller unit. He told me that his parent has a abnormal copies of gene & it is pass down to him. Parents & sister die same illness early age. Only his elder brother showed no sigh of abnormality . A happy go luckily attitude (mentally prepare to die anytime) live together with his bachelor friend.
2. My neighbour block has a dwarf family. Grandparent & parent are all less than 1.3m tall. The children same height as the parent & are likely to be dwarf also.
3. Three generations of depression. Very sad case about her 11 years old son death (depression)
Depression in kids Singapore: A Singapore mum , Doreen Kho shares her story.
https://mothership.sg/2017/11/doreen...ed-depression/
4. My wife distant relatives , auntie has diagnosed breast cancer a year ago. Practically her auntie's parents, brother & sister died of cancer before age 60. Wife told her cousin to buy insurance which they ignored her advice.
5. My friend (lady) husband die of nose cancer at age 39 suddenly. A very sad case that they thought it wont happen to him. So he only did buy small amt. So my friend immediately bought Term insurance $1m. Premium $9k per yr as she got 2 young children.
Disability insurance
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An insurance policy that protects an employee from loss of income in the event that he or she is unable to work due to illness, injury, or accident for a long period of time.
Personal Accident insurance
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An annual policy which provides compensation in the event of injuries, disability or death caused solely by violent, accidental, external and visible events.
Exercise & drinking water
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Lastly, maintain good health is the best wealth. Exercise regularly. Drink more water everyday.
I love to exercise (Tennis & badminton ) because It releases happy chemicals (Dopamine) into my brain. I felt energetic & prepare me to fight the stress in my daily life.
Dopamine, a chemical that plays a role in happiness, is a neurotransmitter in the brain that’s necessary for feelings of pleasure and happiness.
I drink alot of water everyday. First thing I wake up in the morning is to drink a big glass of water. It is now a habit.