The week’s highlight has been the crazy and mad scramble for the Taylor Swift concerts to be held in this tiny, red-dot country in Mar 2024. It was over 2 days of anxious online battles to secure tickets for this coveted event.
Every father, mother, uncle, aunty and kid was enlisted to register for the pre-sale ticket lottery 2 weeks ago. This was after the phenomenal sold out successes of the Coldplay (6 concerts) and Jacky Cheung (11 dates). The rumour was that there was a massive turnout of 22 million registrations. That made the organizers confident enough to immediately decide to announce the addition of another 3 concert dates to the original 3.
Why this sudden success of S’pore, becoming the go-to venue for big concerts in ASEAN? A few reasons. Firstly, it has 2 big and relatively modern venues to accommodate large concerts – S’pore Indoor Stadium (15k persons capacity) and S’pore National Stadium (55k).
Secondly, the ongoing China/USA tension made international acts wary of holding concerts in HK, the traditional venue for Asia. The HK authority’s clampdown on the 2019 riots didn’t help. China’s tit-for-tat imprisonment of political pawns for exchange wasn’t encouraging too. An artist could be arrested in HK for singing a wrong song or promoting American democracy LOL. Hence S’pore became the go-to central destination by default. Acts can now hold multiple concerts centrally for all its fan bases in Asia.
Thirdly, the S’pore government had decided to take back control of the National Stadium recently. With deeper pockets and little need to reach profitability in the short term, they had greater negotiation powers to bid for acts that the private sector probably cannot stomach. It was a fantastic achievement for them since late last year as global acts started to be convinced to hold their concerts here. Like the annual F1 night race, this will drive tourist dollars here as it is within a short flight time that is easily accessible to ASEAN’s 660 million population. Kudos to the strategic planning of the new management and wishing them many more successes to come!
After an unsuccessful 1st day of trying to get pre-sale tickets via a local bank’s credit card on Wed, my wife and son managed to acquire some tickets on Fri during the actual sales day. There were a total of 270k (55k x 6 concerts) tickets on offer which were snapped up within 2+ hours. I narrowly missed buying some due to a stupid personal mistake and the booking platform hung on me subsequently 🙁
Recently I have been evaluating the insurance portfolio that I had built up over the life of my 30+ years of career. There was not much planning while signing up for each policy in a half-hazard way throughout my work life. I had always trusted the insurance agent to review my outstanding needs and recommend new ones that might fill the gaps along the way.
There is just too much technical jargon in insurance policies and I tend to glaze over as the agent tries to explain the terms to me. The evolution of personal insurance was also slow. When I started working in 1990, whole-life policies were about the only game in town.
Having little and limited financial means as I started my career, I tend to purchase small insurance packages that would not be a big drag on my monthly cashflows. Some friends were also starting out in this line of work and I gladly became the guinea pig for their sales pitches. I even bought a 15k whole-life policy from one.
33 years later, I decided to seriously evaluate all my outstanding insurance policies a few months ago. As I am semi-retired, the insurance premiums are a sore drain of funds for me every year. I had to decide if it was worth my while to continue them or if the surrender values were sufficiently attractive for me to encash them to make these new funds work better for me as new investment money.
While I don’t claim to have many outstanding policies to review, I saw a pattern of me moving away from life to term insurance over the years. The insurance industry had also developed along the way and those that I signed up for many years ago didn’t look like wise decisions any more.
The first to go was the one I bought as I started to work for an insured amount of 15k. The annual premium is almost 3% and the surrender value was only about 12k. It has not even grown above the amount of premium I put in for the last 33 years. Given its small amount, I decided to terminate it and take the cash to use for my investment portfolio since the policy resulted in a negative investment with little future upside.
The next policy I surrendered was also quite pathetic. I signed up for a policy linked to mutual funds investment in 1997. It required a regular annual premium contribution of $2.5k from my CPF (Central Provident Fund) Ordinary account. That could have been the main attraction for me then as I did not have to come out with cash. Instead, I could tap on my government-sanctioned CPF retirement funds.
That was a big mistake looking back. Before that, my bank had sent me on a 2 weeks attachment to the bank’s HK Treasury to learn from a product structuring desk. Guess what was one of the products they were trying to promote then? Yup, an investment-linked insurance product. Product structure teams like them don’t get out of bed to work if there is no fat profit margin upfront for them.
There is usually an in-built upfront margin of 5% of the principal for this product to reward the sales effort of the staff to unsuspecting clients. If you do a mark-to-market valuation of the product on Day 2 after you bought it, Ceteris Paribus (“all other things being unchanged or constant”), it will show a drop to 95% immediately because of the 5% spread.
After that 2 weeks HK trip, I concluded that linking an insurance policy to an investment product was a bad idea. Both objectives should be kept separate. Subsequently, I became a product structure salesperson for several years, becoming the dark side evil banker trying to make upfront spreads from unsuspecting customers… But yet I was conned to buy this investment-linked policy probably at a time of personal weakness in 1997 amid the Asian Financial Crisis. Karma’s a bitch. And I kept it for 27 years LOL…
After I checked the surrender value of this policy, I powered up my Excel spreadsheet. With my rustic knowledge, I calculated the IRR (Internal Rate of Return). Cash inflow was 2.5k per year for 27 years versus the termination value now. Unsurprisingly, this might be one of my most worthless long-term investments ever. The IRR was a measly 1.03% per annum &^%$#%&*! Over that same period, the DJI index had grown by 300%.
The termination value was now higher than the insured amount so it was a no-brainer to cash out now and use the proceeds for better purposes. I am still waiting for the funds to be credited back to my CPF account after more than a month now.
I still have a few other outstanding life policies which I will continue to pay premiums for. But the rest are mainly term policies that have no surrender values while providing a bigger payout amount upon death or injury. The premiums are also lower and more manageable for a semi-retired uncle’s wallet.
At my age now (57), it’s too late to try to restructure my insurance portfolio too drastically or add new ones as the premiums are much higher than if I were to start in my twenties. It is the classic dilemma where it’s cheapest when you don’t think you need it, when you are young and healthy, versus when you are older and “wiser” to know you need to plan for your future medical needs…
The insurance industry has developed a lot over the last 30 years and we now have the term InsurTech, a subset of the FinTech push. There are more choices to cater to each individual’s needs and lifestyle requirements. An AI (Artificial Intelligence) bot can probably do a better assessment of your insurance portfolio and provide good recommendations to fill the insurance gaps accordingly. Gen Y and Z will be able to plan and incorporate their insurance portfolio in a much more efficient manner.
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