A Widow’s Close Call: How a Simple Mistake Almost Cost Her Everything
November 2010 is a month I will never forget. It was during this time that I met Mei (not her real name), a woman whose life had just been irrevocably altered. Her husband had passed away unexpectedly, leaving her to raise their two children alone, one of whom has special needs. Grief-stricken and overwhelmed, Mei was suddenly responsible for not only her family’s emotional well-being but also their financial security, a realm she felt utterly unprepared for.
Shortly after her husband’s passing, Mei was approached by her bank with a savings plan. The premise seemed simple enough: pay premiums for five years, and the plan would mature in ten. It sounded like a lifeline, a way to secure her family’s future. Trusting the bank and the representative’s reassurances, Mei invested a significant portion of her late husband’s life insurance proceeds – around $27,000, which was meant to cover the first few years’ premiums – into this plan. The annual premium of $27,000 was substantial, a total commitment of $135,000 over the five years. What concerned me was the banker’s assurance that if Mei couldn’t continue the payments, she could simply stop.
Thankfully, Mei, though she had only recently met me, reached out to discuss this plan. Instantly, red flags went up. As of 2010, I have 11 years of experience as a financial consultant. I’ve learned that insurance plans rarely, if ever, offer such flexibility without severe consequences. “It alarmed me when the client told me that she can stop paying the plan if she cannot pay the balance premium,” I remember thinking. “This is a no-no in insurance. Buying insurance is a long-term commitment. And a breach of it will cost all the initial paid premium to be lost.”
I knew I had to act quickly. Driven by a deep sense of responsibility to protect my clients, I contacted the bank myself, posing as an interested customer. I inquired specifically about the saving plan and the implications of stopping payments early. My suspicions were confirmed: if Mei stopped payments after three years, the plan would lapse, and she would lose all the premiums paid.
Armed with this information, I sat down with Mei and explained the truth about the plan. I’ll never forget the look of relief that washed over her face. She had been on the verge of a financial catastrophe, one that would have devastated her family’s already fragile financial state. Fortunately, Mei was still within the free-look period. I guided her through the process of canceling the plan, and she was able to get her $27,000 back.
“I felt relieved that I managed to help the family safeguard their money,” I recall. “At that time, they only got to know me. Not much trust had been built as compared to the bank that they have been using. I just do what I can to help. I know how precious this amount meant to the family.”
This incident was a turning point, not just for Mei but for me as well. It solidified the trust between us and underscored the profound importance of my role as a financial consultant, particularly during life’s most challenging moments.
My commitment to Mei extended beyond this initial crisis. Understanding her limited budget and the critical need to protect her family, I helped her secure basic medical plans for herself and her children. This was essential to ensure that unexpected medical bills wouldn’t further destabilize their finances.
Today, Mei is 65 and working incredibly hard as a hawker in a school canteen. Her son, having completed his special education, is now helping her. While life has dealt them a difficult hand, Mei has found a degree of stability, and I’m grateful to have played a part in that.
Mei’s story is a powerful reminder that my work is not just about numbers; it’s about understanding, empathy, and guiding clients through life’s most challenging moments. It reinforces why I’ve stayed in this business for 26 years. “Financial planning is never cold numbers, it comes with understanding and guiding the clients with the knowledge I have. To make their life better,” I always say. “It’s about the relationship and being there during their different phases of their life.”
My experience with Mei serves as a testament to the value I bring to my clients, protecting their financial well-being and helping them build a more secure future. I hope this story resonates with my existing clients and encourages them to refer others who can benefit from my compassionate and expert guidance.
Important: The information and opinions in this article are for general information purposes only. They should not be relied on as professional financial advice. Readers should seek independent financial advice that is customised to their specific financial objectives, situations & needs. This advertisement or publication has not been reviewed by the Monetary Authority of Singapore.
Published By:
Ong Wen Lin Klaire
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