Mar 9 2017, 08:11 AM
QUOTE(fun_feng @ Mar 8 2017, 04:16 PM)
Maybe I did not make my sentence clearer...
What i meant was the initial tax relief you got when amortised (new word to me) over a long period of time, the advantage is probably not going to worth it for all the hassle of PRS..
E.g. you get 20% tax rebate from the PRS, and you still have 20 years before you can withdraw this money. This works out to roughly 1% p.a. which means whatever your PRS return was that year, you add 1% return to it.
So this versus you put this money into FSM or whatever and actively manage it whereby you are free to choose between hundreds of UT products and you are free to withdraw all during a freefall..
Hope you get the gist of what I am trying to say, I aint well-versed in economic terms.. I am not disputing the power of compound interest or UT in general
My point is there are pros and cons and probably more cons than what ppl thought.
E.g. If we have a retiree-gonna-be, then this PRS income tax relief is a no brainer, since he is going to get his money back within a few years
Not disagreeing with you. but another perspective is thisWhat i meant was the initial tax relief you got when amortised (new word to me) over a long period of time, the advantage is probably not going to worth it for all the hassle of PRS..
E.g. you get 20% tax rebate from the PRS, and you still have 20 years before you can withdraw this money. This works out to roughly 1% p.a. which means whatever your PRS return was that year, you add 1% return to it.
So this versus you put this money into FSM or whatever and actively manage it whereby you are free to choose between hundreds of UT products and you are free to withdraw all during a freefall..
Hope you get the gist of what I am trying to say, I aint well-versed in economic terms.. I am not disputing the power of compound interest or UT in general
My point is there are pros and cons and probably more cons than what ppl thought.
E.g. If we have a retiree-gonna-be, then this PRS income tax relief is a no brainer, since he is going to get his money back within a few years
1) alot of them dont need the 3k now. For me, Some of the PRS funds are perfectly fine in terms of returns vs volatility (not sure about expenses though, maybe i should research on it)
2) not fair to amortise it over 20 years lo. it's still your money, cannot withdraw only...
3) i agree with the hundreds of fund to choose from... but for those who don't manage their finances well, this is one method lo.
4) those who manage finances well, can't help but just want to capitalise on the tax savings.
Like you have said, maybe one should be more selective about the prs funds they chose, rather than just pick one and leave it as it is. if not the returns does not justify the tax savings gained 20 years ago...
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Just update it today... feeling happy! 
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