Last Updated on 24, April 2014
Today I got news that a client wish to change financial adviser from me to another person (from another company). Not sure why like this as I take this quite personally. If I did a bad job, I deserved it. But for this case, I recalled that I saw the lady in 2008 when the financial crisis first happened. I advised her not to invest lump sum but do an RSP. She took my advice although she did not invest in the larger recommended amount. Now, the portfolio is making lots of money because she managed to RSP when the market went down to the bottomless pit. Despite the good advice, she still wanted to change adviser. I told my colleagues about this incident and they laughed at me. My colleagues shared with me that even if good advice was given, it doesn't mean anything. Also, if the advice was bad, it doesn't mean anything as well. That's why majority of the advisers in Singapore would just sell the highest commission paying product and get the commission upfront. As I had advised on RSP instead of upfront, I earned a miserable commission over the long period. On the other hand, a "hit and run" adviser would recommend an ILP to get the commission upfront and locking the client to 25 years commitment earning miserable return.
So how much did I earned for this case, I calculated that the gross commission was about $500 in total. On the other hand, most advisers these day will recommend an ILP with no insurance but gives an upfront commission of $12,600! The catch is that the client is committed for 25 years with hefty surrender charges.
Anyway, she was one of the last few clients which I did not charge any fee.
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