Financial Planning – Page 2 – Greg Fok Advisory

Work hard, and then, work smart!

April 30, 2024
by Gregory Fok

Most of us are told to work hard. I was told by my Mum to rely on pure grit and strength to get ahead to success in life.

We should all work hard, especially early in our lives. Once we have built some stability and fundamentals, it will be time to work smart.

I was speaking to a couple who were trying to impart the values of hard work to their child. And I added, the next step is to work smart. Let your existing resources, assets and income work for you.

And then after a while, it becomes a cycle of it’s own, without you needing to interfere in between. The cycle of growth and re-growth continues as long as one plans well.

So with the recent case, just by reallocating their existing assets, they have managed to increase their value by an extra $2mil using OPM (Other people’s Money)!

If you know someone who would like to find out how to be more creative by increasing their experience and wealth, let me know and we can have an initial meeting at our cost, with no obligations.

Be a mustard seed!

February 7, 2024
by Gregory Fok

When I first started in my practice 19yrs ago, it was all about achieving success to show the world that I am better.

While that approach worked well for the initial years, while I was trying to gain credibility, it soon tapered off after a while. The sense of satisfaction of achieving the awards no longer seemed to mean as much to me as time progressed.

⏩Instead, what was something that had driven me was the ability to make a change in someone’s life. Of course, the financial impact mattered. One of the clients we worked with had a big challenge when it came to saving any money. But when we recently reviewed her portfolio, she has almost $600k we had built over time! And she was quite impressed with herself!

What was even more interesting was a recent case when I told him to stop worrying about the short term noise in the market. He used to be a stock picker who looked at the markets and news all the time. His eyes were fixed on the prices of the companies.

💥Nowadays, he says that he is so freed up of all the short term noise. He knows he would have held the most valuable companies, most profitable, on a global basis of 15,000 stocks. And it was rebalanced on a daily basis. If the company had run up in price too much, there would be a system to sell part of it, to find other more valuable companies. So there was nothing to track for him and that saved him at least 365 hours every year and re-gained back his mental energy which he had put into exercise and time with his family. And best of all, the wealth will take care of the higher increase.

♥️So if we can be that mustard seed, to help a person grow, TRANSFORM a person’s life, for the better in terms of his wealth, and his LIFE, his business, his fitness, his renewed energy, his outlook, we know we have made that little difference!

How would you like to transform your life in 2024?

A painful lesson of my life.

November 29, 2023November 29, 2023
by Gregory Fok

March 2009…

I was away for a holiday in March 2009, at the depth of the financial crisis. I had sat through one of the biggest downturns of the markets and my emotions and mood was swinging up and down with the market conditions.

I told myself that there seems to be enough blood with the red in investments in the streets. I will want to avoid the emotions so I will wait till I get back from my holidays before I decide to buy more stocks again.

When I got back a few weeks later, the stocks I had wanted to buy had gone up by at least 15%!

So I thought to wait for it to come down before I decide to buy again. The prices soared and never came back down to those previous levels. I had missed the boat. In the recent years, some of these same stocks have actually been delisted!

💥 Lesson learnt : It is so hard to time the markets or pick stocks, especially over a prolonged period of time.

🤓What is the solution?
And so now, I use a systematic process that helps me and my clients have more purposeful living, increased peace of mind, better relationships, reduced risks, have more time for yourself, simplify your life and still get higher returns!

When you have a solid process for decision making made at the beginning, you get to your goals more easily.

Do you agree?

My name is Greg and if there is someone who would appreciate and read my posts and insights, pls feel free to share with them and me and help to repost too!

hashtag#invest

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How do we make investment decisions?

June 28, 2023June 28, 2023
by Gregory Fok

Someone shared with me a “stock tip”. I did some research and believed so much into it and made the decision to buy..!

If you are like me and most people I know, it starts with someone in a social gathering sharing a “stock tip A” and someone believing so much into it.

Then we decide to do some research and extend our belief by finding the data and details to solidify our decision of why this single stock A is worth investing into.

We do the same over time and then accumulate many “Stocks” with no coherent value of decision making but all based on someone else’s story. And even then, we will be worried to put too much into one stock for fear of an idiosyncratic risk of a single company disappearing like “Wirecard”.

When we have more spare cash, we adopt this same model over and over until we realize that we have many stocks and funds that are all over the place. What markets become volatile, which do we sell and buy?

What about the companies that are unheard of, that we might never have heard about of the Apple’s, Tesla’s and Nvidia’s in the early stage. By the time the names come to the public view, typically their valuations have grown to become fairly lofty. But the other question is how many of these small companies grow to become giants in the industry?

💥Does this decision making process make sense?

Well, I previously used this strategy and I can share with you that this does not get me to my big long term goals which need to be sustainable over decades of investment periods into my retirement years which may last 4-5 decades.

So I needed a better way to plan and invest.

Instead, what we do is to help you to reframe the process the other way. Start with your BLUEPRINT of your plan like constructing a building!

💡We go through a process. We start by asking you what your goals are, how much time you have, understand risks of markets, reframe our mental models towards uncertainty, bring confidence through planning before we even decide what asset allocation to use.

What has been your experience and is there a better way you would suggest to bring greater confidence and reduced risks?

Live rich, not die rich!

May 17, 2023May 17, 2023
by Gregory Fok

Some people are concerned about running out of money. There will be others who eventually will have more than enough money for themselves and end up leaving behind too much money.

For those who are retired or close to retirement, you want to reduce the outcome of either running out of money too early or constantly saving and leaving too much money and die rich.

What we do is to help with cashflow planning in your retirement so that you will end up living a rich life now and not die rich.

Maybe it is to take more holiday trips, maybe it is to help with kids in their own families, maybe it is to give more to charity, maybe it is for grandchildren’s education, maybe it is to drive the car for another 10yrs, maybe it is to have a live in helper to ease your routine work load to have a better lifestyle, maybe it is to take a sabattical to explore what is next, maybe it is to help a friend, maybe it is to start a business.

We try to understand what about the value of money that is most important to you in your life, so that you can be able to put that into the cashflow planning. This allows you to see when you might run out of money with Monte Carlo simulation. And if we can do that for you to live a better life and still have sufficient funds to leave behind, wouldn’t that be something that will be a better outcome for everyone?

Find out what is most important to you in your life in the value of money and we plan ahead with you..

Don’t you want to design your best life to live a rich life?

Do you know someone who has a joint loan…

April 7, 2023April 7, 2023
by Gregory Fok

If you do, are you aware that your business partner’s liability now or future, may accidentally become yours?

It is quite common for business partners or doctors, dentists to come together either purchase a clinic, property or start a business or buy medical equipment together. That usually might be the case because on an individual basis, you might not be able to afford buying the clinic, the shophouse, property or come up with capital to run the business. or you basically thought to share the risks with someone else.

So when you do that, you sign the loan off on 2 accounts, once on behalf of the company and the other as a personal guarantor. It might not seem like a big issue at first, but did you know that your partner’s liability can suddenly become yours?

I feel sorry for the innocent parties, however, this case study listed below will have given us a glimpse into understanding that unexpected liabilities that might come about.

A wife bought a landed property together with the husband with a mortgage loan of USD$1.94mil at the beginning. Her husband subsequently, on his own (without the spouse), went on to take on business loans of USD$131mil.

So most people would assume that is the husband’s liability on his own. It is not.

Suddenly, when the husband was unable to pay off the debt, that USD$131mil debt now falls to the spouse as well, on top of the USD$1.94mil loan. (Manifold Times | Wife of Coastal Oil’s Tan Sing Hwa saddled with debt to the tune of USD 131 million)

We help businesses exit smart at the highest multiples, so that you can manage your wealth well.

If you know someone who has taken a joint loan with a partner, it might be time to reassess the financial implications and obligations it might have on you or your family. These scenarios can be planned in advance to be prevented so that the risks does not fall on your friend’s lap.

Never make an investment decision if you feel rushed!

January 24, 2023January 24, 2023
by Gregory Fok

Our emotions drive our behaviour and our behaviour drives our decisions.

When you are upset and emotionally charged, you cannot think clearly and make unwise decisions.

When you feel joy, you feel secured and you make wise choices.

I thought that I was very calm and knowledgeable, especially given that I speak about this daily with the work I do.

However, during the depths of the market in 2008 and 2009, I remembered that I was rushing to buy and sell KeppelCorp (where my wife was working at) and any news about it brought the feelings of greed and anxiety at the same time. As the investment amount grew larger, the emotional roller coaster got stronger.

In the end, I was left with a bad investment experience and bad outcome.

Those of you who had some experience of trying to trade stocks will know what I am talking about.

There are much better ways to invest and get you to your best life with peace of mind using CORE strategies!

When was the last time you took a holiday…

December 28, 2022December 28, 2022
by Gregory Fok

In the past, I will go on a holiday trip and my mind is actually in “office mode”. I wonder how many of you have this same experience?

While I am physically overseas and with my family, my mind sometimes wanders off to check my work emails. On top of that, my clients who have access to my handphone will just msg me, as they may not know that I am overseas. I am not blaming anyone but myself because I have not learnt the art of decompressing to just be with family.

When I am with family, I worry about work. When I was at work, I worry about not being able to spend more time with my family.

So for this December trip, I will try to make a mental note to just be present with my family and enjoy the time with them.

So if I am unable to respond to you promptly, I apologize. In any case, I did send out an email of the contact person in case it will be urgent and that is the power of the team!

Would you love to be able to do the same for your holidays with your family as well?

When we get better at focusing on the right things at the right time, we become better people.

Do you agree?

I will be the next Warren Buffett for Singapore!

November 14, 2022November 14, 2022
by Gregory Fok

That was my dream and goal when I first started my investment journey almost 20 years ago. I am not sure how many of you actually secretly thought the same, just like I did.

Warren Buffet made investing into single stocks sound so easy, and being an engineer by training, I started to find ways to make sure that my dream will become a reality.

I studied many books, theories and concepts of how I could make it all happen. I also spent thousands and thousands of dollars on courses to ensure that I am armed with knowledge. I started to read and study the annual reports of my favourite companies with their cash-flows, balance sheets and profit and loss statements in detail.

I mean, I am a smart guy with a strong heart and am disciplined and patient enough to attempt to get the results I wanted. I will be the next Warren Buffett! I wanted to be in total control of the companies I understood fully and will be comfortable to invest.

This all sounds logical when markets are good and when I have bandwidth to have a sound mind.

However, reality sets in when the market conditions soared and plunged very quickly. Human behavior took over and the emotions and swings of the markets become more than what one normal person can handle. I might have gotten great results 3-5 years in a row, but all it took was one wrong move and it wipes out all prior efforts or missed the next big growth.

After more than a decade of bad investment experience, I had to be humble enough to know that one can never predict nor forecast what is to come in the short term. Anything in the short term is usually luck just like in a casino and does not require skill.

I learnt that investing is more managing emotions than logic. Emotional decision making creates stress and causes more complexity in the outcome because I end up holding suspended stocks with no coherent approach to investing over time.

I still had to find a way to invest to BIG long term goals of retirement which may possibly last decades.

What evolved was a search for not the best product, but a way of life in investing with the right life philosophy with values built in. With that, I used evidence based strategies and data with research of almost 100yrs to identify the highest chance of success, creating the odds in our favour over the longer term. I do not need the highest returns but the highest chance of achieving my goals.

There was a lot of unlearning and relearning a new way of looking at investing, but it is definitely more fulfilling and allowing a better investment experience and a better outcome.

I’m constantly on the search for reviewing what is best for our clients so that we all can have success together, not just in wealth but more importantly, in life as well,

Anyway, clients want peace of mind as a higher priority, do you agree?

Mistakes that doctors and high income earners make

September 9, 2022September 9, 2022
by Gregory Fok

I have been working with doctors and high income professionals over the past 17 years and here is one mistake that they make.

Imagine asking a General Practitioner (GP) to go into the operating theatre to do a surgical operation on his own family member. Do you think that they will be able to achieve the best medical outcome for the family member?

There are 2 things to think about in the process of financial planning.

🦉 Expertise – many lack the ability to see blind-spots.

🦉 Emotions – the decision making process can be emotionally driven and can lead to poor outcomes.

Some doctors try to invest on their own, which is fine, but they know that they can get a better outcome when they work with a professional.

As an example, some mistakes when investing on your own…

🚀 Time – if you spend more time with your patients or profession, you make more money than spending time to trade the market. And better still, spend more time with your family since work life is already so hectic.

🚀 Effort – making a decision of whether to buy, sell or hold can take emotional control over your mind and distract you from your professional work at large.

🚀 Actual results – it has been evidenced that trying to time the market and pick the right stocks over a long period of time is almost the same as gambling. Why play that game when there are better strategies.

🚀 Over concentration and over conservative risks – you take over concentration risks on a small part of portfolio and are over conservative in the larger parts of portfolio.

🚀 Poor outcome – this leads you to finding it hard to reach your big goals like retirement for 20 or more years, except by sheer hard work on your part. Though you know that there should be a better way.

🚀 Poor experience – due to the poor outcome and results, over time, you find that it does not make sense to invest and that slows down the ability to reach your big goals.

🚀 Tax considerations – for the extremely small population that do well in investing, your family might be eventually hit with a inheritance tax bill that can go as much as 40% especially if you are have US stocks and investments.

🚀 Emotional judgement – imagine that you just found out that the stock you have a huge holdings in just came out in the papers with negative news. And you are going into a very important meeting or surgery in the next 1 min. Your concentration level drops and you may not be effective in decision making on both the professional and financial side.

This is just on the part of investment planning. There are many other areas to think about in financial planning like wealth and income preservation, asset distribution, tax planning and others…

What we do as financial advisors is to prevent you from the big mistakes in life!