The wife wants to invest in a Thai retirement mutual fund. Thoughts

[ubonr1971]

My wife wants to put money away to a retirement mutual fund. Theres a link to what bangkok bank offer below:

 

https://www.bangkokbank.com/en/Personal/Save-And-Invest/Mutual-Funds/Retirement-Mutual-Funds

 

What do you think about this product? 

 

She already has an old fashioned AIA life insurance policy that she is paying 260k per year. It has the health insurance as part of the package. I think its a dumb product to pour money into but she is stubborn about this. 

 

What about the retirement mutual fund for her. Actually we both are earning high income from our business. Im mid 50s and have no retirement fund from back home. Should I be putting monthly money into this as well? 

 

We have a valuable building rented out and land x 2 that we bought (in her name. 1 land is in my daughters). But both of us do not have any retirement funds as such.

 

Any thoughts?

thanks

[Mike Lister]

RMF's can be good, if you have Thai income, otherwise they are less good if you can't use the tax deduction.

[ubonr1971]

2 minutes ago, Mike Lister said:

RMF's can be good, if you have Thai income, otherwise they are less good if you can't use the tax deduction.

She says its tax deductable. 

[scubascuba3]

Minimum 5 years, only worthwhile if can get the 30% tax benefit, the key is the fees compared to competitors and performance compared to other funds available, they don't show which is poor, in UK it's usually part of key features, regulatory requirement 

[Mike Lister]

28 minutes ago, ubonr1971 said:

She says its tax deductable. 

Sure, as long as it's held for x years:

 

Investors must continue to purchase RMF at least once a year and must not pause to make such purchase more than one consecutive year. Investors must also continue to invest in RMF until they reach 55 years of age and must continuously invest for at least 5 years.

 

https://www.krungsriasset.com/EN/FAQ/Investment-in-SSF-RMF-LTF-ThaiESG.aspx#:~:text=Investors must continue to purchase,for at least 5 years.

[ubonr1971]

5 hours ago, scubascuba3 said:

Minimum 5 years, only worthwhile if can get the 30% tax benefit, the key is the fees compared to competitors and performance compared to other funds available, they don't show which is poor, in UK it's usually part of key features, regulatory requirement 

yellow bank gives the performance for its funds. doesnt look so good to invest in equity mutual funds. Lots of negative returns. 

 

https://www.krungsriasset.com/EN/Fund-Performance/Past-Performance-Record.aspx

[scubascuba3]

7 hours ago, ubonr1971 said:

yellow bank gives the performance for its funds. doesnt look so good to invest in equity mutual funds. Lots of negative returns. 

 

https://www.krungsriasset.com/EN/Fund-Performance/Past-Performance-Record.aspx

There will be negative returns, try and find a site that compares all the funds in the sectors, then you can easily see the best performing, for example Krungsri may have a fund that's up 5% in a year but Kasikorn may have performed better at 10%. Fees can really vary too. Choosing the right sector is very important as is the Fund Manager, there should be a wide choice not just main banks

[scubascuba3]

7 hours ago, ubonr1971 said:

yellow bank gives the performance for its funds. doesnt look so good to invest in equity mutual funds. Lots of negative returns. 

 

https://www.krungsriasset.com/EN/Fund-Performance/Past-Performance-Record.aspx

This is what i use in UK to compare performance, should be one available for Thai funds

 

https://citywire.com/funds-insider/asset-class/thematic-equities/h21#RankModel=TotalReturns&TimePeriod=12

[Foxx]

See RMF performance at https://www.morningstarthailand.com/th/screener/fund.aspx#?filtersSelectedValue={"TaxSavingFund":{"id":2}}&page=1&sortField=gbrReturnM120&sortOrder=desc

 

 

[Robert Paulson]

Think about it, any time there’s a govt or tax incentive to do something with your money, do you really think it’s a good idea? It’s basically the govt saying “put your money here, trust us”. 
 

Anytime the govt gives you a perceived advantage for anything, run. 

[scubascuba3]

5 hours ago, Robert Paulson said:

Think about it, any time there’s a govt or tax incentive to do something with your money, do you really think it’s a good idea? It’s basically the govt saying “put your money here, trust us”. 
 

Anytime the govt gives you a perceived advantage for anything, run. 

So ISAs and SIPPs in the UK are a bad idea even though there's a tax saving?

[digbeth]

does the insurance she already has entitles her to tax deduction already? usually they can be used for tax deduction up to 100,000 baht per year

[Robert Paulson]

1 hour ago, scubascuba3 said:

So ISAs and SIPPs in the UK are a bad idea even though there's a tax saving?

Tax savings will usually mean you’re actually transferring your wealth elsewhere while you supposedly save. Maybe you should be the one answering questions: why on earth would a govt give you some kind of break on taxes if it didn’t benefit them in some way? 

[scubascuba3]

38 minutes ago, Robert Paulson said:

Tax savings will usually mean you’re actually transferring your wealth elsewhere while you supposedly save. Maybe you should be the one answering questions: why on earth would a govt give you some kind of break on taxes if it didn’t benefit them in some way? 

one reason is they are trying to incentivise people to save, means people are less likely to sponge off the system

[Robert Paulson]

43 minutes ago, scubascuba3 said:

one reason is they are trying to incentivise people to save, means people are less likely to sponge off the system

I don’t think they care about people’s savings. Do you? Do you think govt officials wake up in cold sweats wondering ways they can help people to save more? Ha. I would propose however. The more savings one has, the more that person has to lose via wealth shift at one point however. 
Maybe you’re right though. I think it’s clearer with the marriage example. Govt usually incentivize marriage. And that’s not because they care about you. It’s because you become a perennial and more efficient taxpayer. You’ve got kids to feed. You need to buy a house. They have got your next 40-50 years locked in. 
The way the stock market works is it crashes every now and again. Where do we all think that money goes? Did it just disappear? No. Wealthy people who control the country make money when that happens. Wealth shifts. It’s all a mirage, all the stuff they incentivize you to do. 

[Purdey]

Mitigate the 30% tax saving with the steep fall in share prices.