SOS Secret of finding out Education Funding?

Education Funding

Kid = 3 years old, Assumed 19 years enter Uni, Investment return = 5.058%, Course inflation = 6%

1. Find FV of fee when your kid is age 19.  PV(course fee today), I (inflation), N (no of years to Uni)

2. Find PV[when kid reach 19] (for 3 years course fee) (BGN)  PMT (204,000), I (5.058-6/1.06), N (3 years course) = 826,000

3. Find PV(now required) = PV (826,000), I = (5.058%), N = (years to 19 years = 16)

SOS The Secrets that most people trying to avoid in their life?

Dear readers (not that it exist anyway),

Well, what is the secret?

It is call FP?

When you are sick, who do you go to?

When your car have problem, who will you call?

So, who is FP?

Do you ever spent a bit of time thinking whether you have enough money for your retirement?

Or for your kids education?

Frankly, with such a stressful day you have in work, and busy catching up with your family, who have time for such a thing, trying to find out the ugly truth?

So when you want to find out whether you can achieve your Financial Goals, you consult a qualified Financial Planner.  That is what FP is all about.

Well, in Malaysia, it is still at the infancy phase, typical Asian, shy to reveal their wealth. Scare of being  mug?

No actually, scare to find out that you may not have enough to for your kids education funds and retirement funds.

Well, actually, not that Asian is shy, actually they always wants FREE stuff, even for financial planning.  The first thing is that they will ask, what is the fee?  They never think about the BENEFITS of doing a financial planning.  

So, what is the point of finding out that you may not have enough savings for your kids or retirement?

Did you have a plan if something bad happen to you? Such as Death or Critical Illness? Is your spouse, kids or parents well PROTECTED if you are the breadwinner of the family?

Never bother right?

What happen if you find out your are UNDER coverage for your insurance?

Well, like doctors, FP will diagnose your financial health, talking about your net surplus, savings, debt servicing ratio, liquidity, debt over assets etc, just like testing your blood, if , one you have high blood pressure, high cholesterol, diabetes, other sickness it might shown in your blood or other health screening test.

Similarly, FP is your financial health doctor.  You have to see a FP regularly when to know if you are Financially in good health.

When was the last time you wrote or update your Will?

Can you name or your nominees in your life insurance policies or EPF?

Have you any idea what is your yearly expenses? Or how much you need roughly for your retirement, say you may live up to 80 years old?

FP is actually a PROCESS.

It is a financial planning process, called EGADIM.

E is for establishing and defining relationship with the client.

G is for gathering client data.

A is for analysing and evaluating client's financial information.

D is to develop and presenting the Recommendation

I is for implementing the financial plan recommendations

M is monitoring or reviewing the implementation of the financial plan.

EGADIM is actually all done and reported in the Financial Planning report consisting of:-

1. Executive Summary
2. Personal Data
3. Planning Assumptions (Introduction on EGADIM, the 6 step process of Financial Planning process)
4. Existing Financial Situation (Cash Flow/Net Worth/Financial Ratio/Tax Analysis/Investments/Risk Management/Estate Planning)
5. Achievability of Financial Goals
6. Recommendations and Action Plans
7. Disclaimer
8. Appendix (EGAWII)

SOS US Dollar vs toilet paper

There were many articles written on the US Dollar will collapse after all the QE after 2008.  6 years after, 2014, there is no sign of collapse and many experts continue to make such theory that US Dollar will one day become toilet papers.

This is actually a trillion dollar questions.  Will US Dollar become toilet one day.  Can the experts be right.  They have all the arguments and facts and logic behind it, but today, it stays as strong as what is 2008 against the Euro, at least.

US Dollar is widely used.  This is a fact.  Petrol dollar, how much transacted in USD? When Iraq, threaten to used Euro to transact petrol in Euro, Iraq is invaded and torn apart.  When Libya threaten to use Euro  to transact in Euro, Gaddhafi is assassinated and Libya has a new leader.  Any country that do not toll the line, they will be wipe off.

So, besides oil, what else is mainly traded in USD?  Don't forget, forex trading, traded about USD3 trillion a day, all done in USD, who can actually replace it?  Not China, not Europe, not Japan, not any country actually.

Yes, not even gold can replace USDollar.

I am not an expert, but I believe the argument made by Robert Prechter and Gary Shilling are correct.  Their line of argument is correct.  US Dollar is like a commodity widely used in the WORLD.  Whether you like it or not, it is not easy to be replaced.  They were talking about Bitcoins etc. The answer is UNLIKELY.

Here is why, America has issue Trillions of DEBT.  This DEBT will gradually become BAD.  This DEBT amounted to more than USD100 trillions.  A lot of it will turn BAD, i.e. non performing loan, gradually over the years, and each DEBT issued must be accounted for, either by the lenders or the borrowers.  Gary Shilling called it in his booked called, THE AGE OF DELEVERAGING.

Gary said that these trillions will be gradually wipe off the market.  That means this US Dollar debt ISSUED to the borrowers, will become NON PERFORMING, hence, trillions of US Dollars supplied to the market will be wipe off vs the printing of US Dollar, the dollar that turn bad is far HIGHER than the printing of new US Dollar to a tune of more than 10 times.  Hence, the AGE of DELEVERAGING argue that US Dollar in fact will become stronger over the years, against other major currency like Euro.

Similarly, after 2008, not only US has inject trillions into the market, so is Euro, so is China, so is Japan.  The concept remain the same, US Dollar in the MARKET cannot be replaced, period.  So, the proponent that US Dollar will become toilet paper, sadly, will not come true.  So, majority will be shock in future to find out that US dollar become stronger instead.

This may not be what majority wants to hear, but it is the most logical deduction.  US Dollar, is a commodity, that is supplied to the market in most transactions.  I have not mentioned derivatives, mainly transacted in US Dollars, comes to a tune of USD600 trillions, 10 times the world GDP.  You tell me, who can replace this much of toilet papers?

SOS what do practitioners said about practicing Falun Gong

Types of people that practices Falun Gong

Account Executive - Cary Dunst
Artist - Vivian Song
Psychotherapist - Jeanne Mitchell
VP, Strategic Planning - Li Pinyi
Personal Trainer - Tysan Lerner
Marketing Director - Dan Chen
Physician - Dr. Zhiyuan Wang
Former Model - Pea-Mara Norris

What do they said about the practice?

The biggest lesson I learn is to look within myself and find something to improve instead of angry and complain about others.

Instead of looking outward on what I dislike about others, I think more how I am responsible of controlling my thinking.

It provides the inner peace for me.  I am not worry about anything that happen around me, because I have values and principles to abide to and I sense of inner security, calm and peace that I didn't have before.

TO LEARN MORE ABOUT FALUN GONG

visit: www.falundafa.org

SOS Disclaimer

Disclaimer

The suitability of the financial strategy and the appropriateness of the investments used, tax planning services, estate planning services, accountants and other professional services to meet the financial needs with conjunction with the strategy vary depending on the individuals facts and circumstances.

The information presented is based on the interpretation of the laws and regulations to date and it is no substitute to the tax advisors, estate planning advisors and other professionals that you may have engaged.  Materials used in the report is based on reliable sources and no representation is made on its accuracy and completeness.  The information and ideas must be discussed in detail with the individual advisor prior to implementation.

Cover page

Comprehensive financial plan
for
Mr Lim
as at

Presented by ABC Sdn Bhd
(licensed by Securities Commission of Malaysia)

Content

1.0  Executive summary
2.0  Personal Data
3.0  Planning Assumptions
4.0 Existing Financial Situation
      4.1  Cash Flow Statement
      4.2  Net Worth Statement
      4.3  Financial Ratio Analysis
      4.4  Tax Analysis
      4.5  Investments
      4.6  Risk Management
      4.7  Estate Planning
      4.8  Debt Restructuring (if any)

5.0  Financial Goals
6.0  Recommendations and Actions Plan
7.0  Disclaimer
8.0  Appendix

SOS What's happening?

It has been a while since I blog.

Nothing much has been happening.  The world it treating me well.  No complain.

Any new adventure, basically, taking CFP.  Learning something new.

Will be in UK again in June.  I remember on June 5 when we were there, there was a bombing of 4 tube stations and a bus station.  I was shock to learn that it was a coincident an company specialised in "explosive" was doing its exercise at the same 4 tube stations.  For what  you know, the explosive was planted there.

Lately, in March 8, Malaysia has her own share of tragedy. MH370 went missing while flying from KL to Beijing. In April 18, an accident killed Karpal Singh.  And before Karpal sink, a ferry in Korea also sank, about 300 missing (not including 24 dead).

What will happen next?

Positives or negatives?

SOS Six Emotions and Seven Desires Part 2

Notions are formed post birth.

What it means is how a person sees the world is INFLUENCE by his experiences after birth.  Indirectly, a person is controlled by the his own NOTIONS instead of by his own main consciousness.

One may ask, what is the big deal.

It is actually a very BIG DEAL.  It is like you surrender your TRUE SELF (i.e. your main consciousness) to be control by your own NOTIONS.

NOTIONS of todays world is full of jealousy, greed, dishonest, competitive,