Raymond Ng, founder and managing director of Ray Alliance Financial Advisers, was interviewed by the Straits Times and the report published on 31 Jan 2010 (Sunday).
When it comes to his personal investments, he believes that diversification is the key.
Last year, Mr Ng, 53, invested $50,000 in a financial product that is relatively unheard of here. He now 'owns' a share in five privately run automated teller machines (ATMs) in Canada. As part of the deal, he potentially gets a cut each time someone uses one of the ATMs. And it comes with a money-back guarantee at the end of five years.
He also ensures that he has set aside six months of emergency cash reserves before parking his savings in unit trusts, stocks, insurance and land banking.
Mr Ng was an insurance adviser at local insurer Great Eastern (GE) Life for 18 years before he decided to venture out as a financial adviser.
After leaving GE in 1997 where he was the group sales manager, he set up insurance broking firm RP Insurance Agency with a partner. He sold his shares in the firm two years later and set up Ray Alliance Financial Advisers in 1999.
Prior to joining GE in 1979, Mr Ng worked in United Overseas Bank (UOB) for 18 months as an internal officer. A former Catholic High student, he obtained a diploma in banking and finance from the Institute of Banking and Finance in 1978.
He has been a fellow member of the Australian and New Zealand Institute of Insurance and Finance since 1985.
Last year, he became president of the Association of Financial Advisers Singapore (AFA), which has 28 member firms.
'It is my vision for AFA to be the bridge between our members, the regulator and other stakeholders. It should be the platform to represent the views of advisers as well as the catalyst to upgrade the professional and ethical standards of advisers,' he said.
Mr Ng is married to housewife Regina Seng, 49, and they have two daughters, Sihui, 21, and Yiling, 19, who are studying at the National University of Singapore.
Q: Are you a spender or saver?
I may not be considered a good saver. I save 20 per cent to 25 per cent of my income. However, I spend within my means, which is around half of my income, for basic needs. I use the balance for investment.
Q: How much do you charge to your credit cards every month?
I have a total of 15 credit cards and two corporate cards. I usually use four of them. I settle all my credit card bills promptly and in full. I withdraw $500 from the ATM two or three times a month and as and when I require cash. I always keep $500 in my wallet.
Q: What financial planning have you done for yourself?
I consider myself a moderate aggressive investor and I manage my own investments.
I park six months' worth of emergency funds in fixed deposits. My portfolio comprises 40 per cent in unit trusts, 60 per cent in stocks, an exchange traded fund, insurance and other alternative investments like land banking and the ATM investment.
In terms of unit trusts, I am 60 per cent invested in Asia with the balance in property funds. For stocks, I own mainly blue chips like Singapore Press Holdings, Fraser & Neave, DBS Bank and DBS Land. I look for good dividend payouts and long-term capital appreciation. In 2007, I invested C$30,000 (S$39,000) in Canadian land. My target portfolio returns are around 10 per cent to 12 per cent per annum.
My insurance premiums amount to $40,000 a year and I own term, endowment, whole life, critical illness, medical and personal accident plans.
My life cover is $3 million while that of my critical illness is $1 million. I have another $1.5 million personal accident cover.
Q: Moneywise, what were your growing-up years like?
I grew up in a rented three-bedroom shophouse at the site of the current National Library in North Bridge Road. I am the youngest in a family of seven children.
My father died from brain haemorrhage when I was nine months old and my mother raised my siblings and me single-handedly. My father left behind a small provision shop and practically no cash. Mum managed the provision shop after his death.
He did own an insurance policy and the family received a $20,000 death benefit. Because of that, I developed a passion for life insurance. I also learnt to be independent and thrifty from a young age. To earn my keep, I gave tuition during my secondary school years.
Q: How did you get interested in investing?
When I was working in UOB, I invested in my first stock which was the initial public offering of DBS Land. I later joined the insurance industry and gained more exposure to investments.
I invest in accordance with AFA's principles, which include not buying anything that I don't understand. That explains why the majority of the 28 AFA member firms did not get involved in selling Lehman's Minibonds even though we were approached to do so.
Q: What property do you own?
I bought a three-bedroom terrace house in Upper Changi in 1992 for about $730,000. It has a built-in area of 2,800 sq ft and a land area of 2,000 sq ft. I recently renovated it for $150,000. Its current value is about $1.5 million.
In 2007, I bought a 1,500 sq ft freehold condo unit in Katong for $1.8 million. I sold it for $2 million last year. It was rented out at $5,000 a month till then.
Q: What's the most extravagant thing you have bought?
I splurged on a pair of Rolex King watches, which had a hefty price tag of $40,000, for Regina and myself. This was when I closed my first big insurance sale in 1983 and my commission amounted to $80,000. I wear my Rolex only on special occasions.
Q: What's your retirement plan?
The term 'retirement' does not exist in my dictionary. I will choose to work at my own pace as I let my accumulated wealth work for me. I would need at least $5,000 a month for my family in my golden years.
Q: Home is now....
A. My home is the three-storey terrace house in Upper Changi Road.
Q: I drive....
A. 2.4-litre silver Toyota Harrier.
WORST AND BEST BETS
Q: My worst investment to date...
I lost $150,000 when the prices of my Malaysian Clob shares fell in the late 1990s, when Malaysia unexpectedly banned trading of its shares on Clob in 1998. I was holding stocks like Idris Hydraulics and North Borneo Timber. My initial investment was $230,000.
Q: My best investment to date...
In 1999, I invested $15,000 in the Keppel Telecom Fund and made a profit of 80 per cent, or $12,000, in less than eight months.
Ray Alliance is also a very good investment. I set it up with $150,000 and have invested a total of $300,000 in the firm so far. The firm is now worth $2.5 million. It has 28 advisers and five staff.