NEW Tax relief 2019 you can reap

In year 2019, there will be a new tax relief structure for EPF and life insurance. Where it was previously combined with a total relief of up to RM 6,000 a year, the new structure will split it into RM 4,000 for EPF, and RM 3,000 for life insurance.

This translated to individuals earning more than a gross income of RM 3,030 monthly and don't currently have life insurance coverage, will see their EPF tax relief reduced😱😱

Credit: StepUpMoney

So if you are earning more than RM 3,000 a month and are not currently covered any by life insurance policies, please get one.

RM 3,000 a year means our Government is subsidizing an individual’s life insurance policy with a RM 250 premium per month – that amount can easily provide a six-seven figure coverage when life takes a turn for the worst.

Credit: StepUpMoney

If you would rather not buy life insurance (since it would cost money) but would still want to recover the RM2,000 loss in EPF tax relief, depositing RM8,000 on SSPN would be an alternative!

Take advantage of the increased tax relief for SSPN for year 2019, which not only offer high dividend rates (in 2017 the dividend yield was 4%), but there are also additional benefits such as income tax relief, PTPTN loan eligibility and Syariah-compliant savings that are guaranteed by the Government.

From 2019, the Government is increasing the tax relief amount for SSPN deposits by parents from RM6,000 to RM8,000 a year👉additional RM2,000 that you can get back from the Government to offset your annual income tax from previous years, making it an extremely lucrative savings plan (provided your annual income tax is high enough to claim the full amount!)

One of the reader ask me, if you can still open SSPN if you do not have children? YES, you can still open for your nephew or niece, at the end of day you still have control over the money as you can withdraw anytime.

Case Study1: Children Insurance

Scenario: Family annual income RM50,000, currently both husband and wife already have ILP Life/TPD + 36CI + Medical card. Their aim is to protect their 3 year old son and hope he can prepare education fund of RM50k in next 20 years. Insurance Budget: not more than 2000/year 
Proposal for Son, 3 year old, no health issue

How to buy insurance for Children?

Although we all love our children greatly and want to buy everything for my children, we all have limited resources. Many people bought the wrong one and spent a lot of money, but the child's protection is still not complete.

Common mistakes in buying insurance for children:

1.  Follow Trend: What others need is not necessarily what you need;

2. Repeated purchases: A large number of overlaps between the previously purchased product coverage and the new product coverage;

3. Irrational purchases: purchases of some non-essential, occupy a large amount of economic funds, and the protection that children need most is not purchased.

Before you buy insurance, you must understand the insurance allocation principle and then study the product before you buy the wrong one. There are three main principles for buying insurance for children: 

Principle 1: First insured the adult (esp. the breadwinner), then only children. 

Remember the parents are the biggest guarantee for the children. Only the parents can comfort themselves. Therefore, when choosing insurance, it is necessary to give priority to the elderly and then protect the children. 

Principle 2: Health Protection is important

Medical insurance is a state-provided welfare guarantee. It is essential to buy for children as have lower immune system at younger age and are more prone to have accident.

Principle 3: First Protect, then only think of wealth management

Insurance is used to transfer risks and should start with basic guarantees: death, TPD, Critical Illness, Hospital & Surgery, Medical Reimbursement,... 

The major risks faced by children in the process of growth are mainly major disease risks, accident risks and educational risks. Multi-party data show that the incidence of severe illness in children has increased in recent years, taking malignant tumors as an example: 

1 According to MOH, most common cancer in Childhood is Leukemia (Source:  Malaysian Study on Cancer Survival(MyScan 2007-2011))

2 Hospital Kuala Lumpur oncology unit sees about 200 new childhood cancer cases yearly (source: Dr. Mohamed Najib-paediatrician currently undergoing fellowship training in Paediatric Haematology, Oncology & Bone Marrow Transplant in Hospital Kuala Lumpur.)

Tip1: It is recommended to choose a regular critical illness insurance when the child is still young, and take into account the inflation factor. It is recommended that the insurance amount be as much as RM50,000~RM300,000 (the treatment cost for general serious illness).

Tip2: Critical illness insurance and millions of medical insurance are a perfect match. The critical illness insurance is responsible for the diagnosis and payment. It is used to pay the sickness treatment in time, which can be used as the child's rehabilitation and treatment costs. Millions of medical insurance can be used for reimbursement of illness.

Caution: Because the child's physical function is still in the developmental stage, the resistance is weak, and it is prone to headache, brain heat, cold, pneumonia, enteritis and other diseases. Most of the time, only outpatient treatment is needed, and a slight severity can lead to hospitalization, but in general, daily illness does not impose a serious burden on the family economy. However, this part can also be transferred through insurance, and children's outpatient and child hospitalization insurance is used to protect such risks.

Tip3: Children are naturally active and curious about the world, but their judgement ability is very weak and their ability to resist risks is very weak. They are prone to common risks such as falling, bumping, scalding, drowning, and car accidents. Therefore you may want to consider PA insurance too, GE GreatShield Active provide worldwide coverage at as low as RM0.45 per day!!

Great Shield Active PA Insurance At Glance

Coverage age: 30 days old till 70
Renewable up to age 100
Just pay 45 cents per day for RM80,000 coverage!!!

1. Worldwide Protection against  Death/Permanent Disability due to Accident including terrorism*(exclude Nuclear, chemical or biological)
2. 2x indemnity for Accidental Death on Public Conveyance or at Public Sports Event 
3. 3x indemnity for Total Permanent Disability on Public Conveyance or at Public Sports Event 
4. 5% renewal bonus per year up to 100% of Capital Sum Insured 
5. Medical expenses include Dengue Fever, Malaria, Zika Virus, Japanese Encephalitis, Yellow Fever, Scarlet Fever or Coxsackie
6. Other benefits: Hospitalization income, Theft reimbursement, Post-hospitalized Cost,..

Do I need Personal Accident Insurance?

We all agrees that accidents are unexpected, unpredictable, and often can be financially draining. The consequences of an unfortunate accident can be dramatically life changing, not just for you but also for your family.

You should buy a personal accident policy because it plugs an important hole in your insurance portfolio. Firstly, it will provide financial support to the policyholder if he is disabled after an accident. Secondly, the magnitude of the mishap doesn’t matter; even minor ones like falling off a bicycle and breaking an arm, or fracturing a leg while playing football are covered by the policy. If you thought term insurance policies were cheap, wait till you find out about the premium rates of a personal accident insurance.

Notes

1. Premium is based on occupation and not age or health status
2. If you have more than one PA policy, you or your beneficiary will be compensated upon your death or disablement. However, certain claims like medical expenses can only be made from one PA policy. If the medical expenses is more than the sum assured, you may claim the difference from the second PA policy
3. Personal accident cover isn’t a substitute for life insurance, but it can provide a financial safety net for you and your family if you are met with an unfortunate accident that results in your injury, disability or death. It should definitely be used in conjunction with life insurance to be completely secured.

What is the value of sum assured RM 1mil after 30 years?

No one can avoid INFLATION which mean our money value will decline overtime. 20 years ago, a roti canai only costs 50 cents. Today, you need to spend RM1.30 for a roti canai.

The biggest impact of inflation is the shrinking of family wealth.

If you have cash in your hands, but no real estates, collectibles, and equity funds that can be appreciated over time, then your money in hand will shrink in the future. This is the power of inflation.

There are 3 ways to avoid inflation affecting family wealth:

1. Borrowing (interest is low, preferably no interest);

2. Consumption (to spend all the money, no inflation can surpass that);

3. Invest in commodities that value-added speed outperforms the inflation rate (such as buying stock funds, etc.);

It is unrealistic to borrow money. For those who naturally love to save money, it is not feasible to consume all the money. The only thing that is feasible is investment.

FACT 1: Insurance can't resist inflation
In the long-term, insurance adopts the equilibrium rate. In this case, inflation is considered. That is, the premiums you pay each year are the same, and will not rise year by year like the price. Otherwise, the money you pay in the 20th year will not be the same as the first payment 20 years ago.

Moreover, even if the insurance company collects the money, due to inflation, "money collected is not worth the money also." Therefore, in actual fact you only move the "same" money to insurance company. If you put it in the bank or at home, it will depreciate.

What's more, the core of insurance is the protection of people. If something goes wrong during the insurance period, you can apply for a claim. If you know what will happen in the future, you don't have to buy insurance at all.


FACT 2: Dividend/Endowment insurance can't actually resist inflation


FACT 3: We can increase the insured amount in the form of “insurance combination” or “multiple insurance” to effectively hedge inflation
The insurance is "GUARANTEED", the ultimate essence lies in the protection, not the financial investment. In insurance, best way to hedge inflation is thru consumption, that is to use minimum amount of money to buy insurance and yet can achieve the maximum protection (insurance) in return.

♥we can increase the amount of insurance through the insurance portfolio, such as medical insurance, critical illness insurance, life insurance and so forth to more comprehensively deal with various risks in the future, can effectively hedge inflation.

♥at the same time, you can consider investment linked insurance which allow you to re-insurance and allow adjustment of sum assured within the guarantee period, multiple allocations to increase the amount of insurance. If you concern on the budget, don't buy any insurance such as dividends and returns. The core of buying insurance is to protect people, not to obtain higher interest rates through insurance companies.

Medical Protection vs Critical Illness Protection

	Medical Insurance	Critical Illness Insurance
What does it do?	Medical plan pays for the cost of treatment and medication of a hospitalisation	Critical illness plan provides a lump sum payout upon diagnosis of one of 36 critical illnesses, total and permanent disability or death
What can I do with the claims?	Pay for medical cost of treatment or hospitalisation	The patient can use the lump sum payout for anything they want, not restricted to medical treatment. For example, some use it to help their family’s financial situation.
Coverage until?	Until age 99	Until age 80 or death
Who does it most benefit?	The policyholder (and his family, if plan covers family) as it helps pay for their medical treatment	The policyholder and/or their dependents, depending on use of payout
What is the premium payment like?	Premium increases with age	Premium remains the same throughout lifetime

Insufficient Critical Illness Protection

I hope the following helps people to understand more on Critical Illness Protection. Most of the old policy can only be claimed when the policy holder has been diagnosed with severe or advanced stage of the covered event

For example of cancer, when one is diagnosed with "Carsinoma in situ", the policyholder cannot make claim...

CANCER, HEART ATTACK & STROKE are the 3 major illness that hit our Malaysians today.


The statistics show us that the chances of any of us getting these illness is so HIGH. Scary right?

Good news is that today you can buy an insurance known as Early Critical Care to protect your income if these actually happen to you.


The following chart helps to explain what is not included in the most of current 36 critical illness insurance by most of the major insurance company in Malaysia.

As usual if you want to know more, just contact me ok. God Bless!

Why You Need Life Insurance

Why is it so Important to Have Life Insurance?

Getting a life insurance policy is vital for ensuring your family's security in the future and your peace of mind today. You want to make sure your loved ones will be protected and have financial security if the unexpected should happen to you. Everything from medical bills and funeral costs to mortgage payments and educational expenses can be a drain on all you've worked and saved for. That's why we believe it's essential to have financial protection in place for your family in the event of your death.

Single? Life Insurance Can Still Make Sense.

Even if you're not married, life insurance can still be a smart decision. Singles are more likely to experience major life events that lead to the purchase of coverage from a life insurance corporation, such as buying a home or having children. Many times, too, single people are responsible for older relatives such as parents or grandparents, especially if they don't have siblings, and they want to be sure those dependents will be cared for should they pass away.

Take Action Today to Protect the Ones You Love Tomorrow.

There are many types of life insurance policies on the market to protect your family and finances, making it easier than ever to find the right balance of the affordability, flexibility and protection your family needs. 

You can quickly and easily get a quote and start the simple application process right now. It's free and with no obligation. 

10 Days Salzburg-Hallstatt-Konigsee-Ljubjana-Zagreb Itinerary

Modern Gulliver Giant near Tkalciceva, Zagreb

Kuala Lumpur-SG-Frankfurt-Salzburg

Arrive Salzburg 11am (Bus#2 to main train walk to YOHO)- relax and walk around Mirabel area.

Salzburg to Hallstatt Bus#150 Salzburg HBF-Bad Ischl (€10.40/p, 1hr)-Train to Hallstatt (€4.10/p, 20m)>Buy the day ticket cost €29/pax-Ferry to Hallstatt (€2.50/p, 15m). Had our late lunch at Baugasthof. Drop in Bad Ischl for short break while waiting for connecting bus back to Salburg.

Salzburg to Berchtesgaden (BGL-TagesTicket Bus & Bahn -12euro per pax), (Bus840) & Königssee(bus841) We bought a day pass for the both 840+841 (€10.20/pax) bus and enjoyed a 45 minute trip to Berchtesgaden and 841 bus to go to the lake. The connecting bus is just 15 min apart on the opposite platform. After a short ride, we were close to the lake and followed a sign that pointed to a trail to take to the lake. We walked about 10 minutes, then there we were. The next boat was getting ready to leave, so we quickly bought our tickets and got on. We were given a brochure about the sights on the boat ride for English speakers. The bugle player demonstrating the echo was a nice touch! We enjoyed getting off the boat at St. Bartolome's church and walking around for a bit and taking pictures. It was very beautiful! After we got back, we caught the last bus back to Berchtesgaden, where we then switched to the 840 for the trip back to Salzburg. Beware that the last bus during weekend back to Salzburg only stop at the border and you will need to change to bus 25 (noo need new ticket) to go back to Salzburg. A lot of bus changes but we enjoyed the day.

Salzburg Card(€28/pax)-Bus25: Untersberg Cable Car- Hellbrunn Palace (TrickFountains)-Hohensalzburg Fortress(funicular+lunch)-Mozart’s residence and birthplace-People watching and relax

Salzburg-Ljubjana (Congress SQ, Peseren Sq, Triple Bridge, Central Mkt, Dragon Bridge)

Lake Bled: Bus#7(6.80/way)-Ljubjana -Ratace. Just buy the ticket from the bus driver, it's cheaper. There is no need to buy return ticket. It takes about 3 hour to walk around the lake (6km) slowly. We visited Tivoli Park later in the evening.

Ljubjana-Zagreb (about half a day)-Tram#6 to Donji Grad (where we stay, very nice and convenient area) -Stroll upper town (more interesting than downtown) -Street Art-Funicular-Kula Lotscak (360 view)-St Mark Church-Historical Govt Building-Stone GateStone Gate – A shrine to the Virgin Mary that is believed to possess magical powers.Dolac – A large fruit and vegetable market open daily from 7am to 1pm.

Zagreb:Food: cevapi-meat sausage, taste better than kebab ;-) Stroll downtown and had our dinner at Tkalciceva (Restaurant Street) – This colorful, pedestrian-only street is lined with colorful restaurants, bars, and cafes. You’ll definitely want to head here in the evening to find a spot to eat!

Zagreb - Dolac Market -Zagreb Cathedral-people watching go airport around 130pm- Venice. Food in both Zagreb airport and Venice Airport is very expensive and not much choices. Best to pack some food (danish, tidbits, fruits) if you have long transit like us.

Kuala Lumpur (Home sweet Home)

Not for me?

Nobody wants to gamble with their family's financial future. If you've been putting off buying a life insurance policy, but have a need for one, it's time to nix the excuses and get back to why you need coverage and who you are buying it for.

The following are five common reasons why some people who initially show an interest in life insurance don't end up purchasing a policy, along with key takeaways to help you ditch any lingering excuses:

1. Life insurance is too expensive. 

The number one reason people put off buying life insurance is because they think they can't afford it. In fact, when asked the price of a 20-year, $250,000 term policy for a healthy 30-year old, 1 in 4 people estimated the cost in excess of $1,000 or more a year.

Key takeaway: Life insurance may be more affordable than you think! There are many different options today to help protect your family, making it possible to find the right balance between coverage and affordability. Comment or PM me if you need more advice.

2. I don't need another bill. 

For many people, life insurance is just another monthly bill to add to the already growing stack. But are all of your monthly expenses going toward absolute necessities?

50% of consumers surveyed indicated that additional living expenses, such as their monthly Netflix/Astro bill, is just one of the many financial barriers that kept them from buying some or more life insurance. We're not saying you need to sacrifice the fun things in life in order to buy a life insurance policy, but if something were to happen to you, isn't your family worth forgoing a month's worth of fancy coffee drinks or brown bagging your lunch a few times a week?

Key takeaway: Most of us have conveniences and niceties that we spend our hard-earned money on each month. When you really stop and think about it, are there things in your life you can cut back on or just prioritize differently to afford the life insurance coverage you need?

3. The process is confusing and I don't know where to begin.

Many people put off buying life insurance because they're confused about what type of policy to buy, how to go about calculating the amount of coverage they need, and have too many unanswered questions.

People who are new to the life insurance buying process can feel a bit overwhelmed. The fact is, with the right resources, the entire process can be managed from start to finish in a series of simple steps. Yes, it involves a process, but so does buying a house or a car.

Key takeaway: Don't go it alone. Work with a qualified life insurance agent or company representative who can guide you through the process and get the answers you need to make an informed decision.

4. I don't like thinking about death. 

Newsflash - nobody likes thinking about their own mortality, so you're in good company. Unfortunately, death is a part of life. If you have people who depend on your income for financial support, then most likely need a life insurance policy to protect them.

Do you have car insurance? What about a homeowner's policy in the event your house catches on fire? The truth is, nobody likes thinking about getting into a catastrophic car accident or watching their home and precious belongings go up in flames, yet we carry insurance to protect them. If you know you need the coverage - now is the time to get the process started.

Key takeaway: Once your policy is issued, be sure to pay your premium and review your coverage at least once a year - just like you review and renew your auto and homeowner's policies.

5. I'm young and single. I don't need life insurance. 

While it may not seem as important to have life insurance as a single person in your early 20s, that could all change just a few years down the road when you get married and start a family. Plus, there are many ways a single person can use life insurance to take care of financial obligations that could burden those you love should you die unexpectedly.

For example, do you have outstanding balances on credit cards or a vehicle loan? Has a family member or friend cosigned on a student loan or mortgage on your behalf? If you were to die unexpectedly, who's going to satisfy these obligations? Having outstanding debts means your estate will have to deal with what you owe. And, leaving any loans to be paid by a cosigner means that the people you love and who have helped support you, will now be on the hook.

Key takeaway: It can be a lot less expensive to get a life insurance policy today, while you're young, versus waiting. And with a permanent life insurance policy, such as whole life or investment linked policy (ILP), purchasing in your younger years allows you to enjoy those rates for the life of the policy.

Does any of above sound familiar to you? I hope that I've helped nudge you just a bit closer to pushing aside any hesitation that may be keeping you from getting the coverage you need - for today and tomorrow.