So, the other day my wife's idiot friend, acting as an agent for a bank, tried to introduce her to an investment/insurance plan. My wife suspected something fishy with the numbers and wasn't sure it was a straight deal so she decided to run it by me to get my opinion. Now this is a well-known local bank and one of the largest in the country but typically with most banking investment packages these days .......they are total bullsh!t. Strangely enough, many people seem to fall for the same schemes day in day out. Are people really that stupid....and greedy? It goes something like this :- You have to buy into an insurance investment scheme where you deposit RM 10,000 principal on the first year whereupon they will pay you a once-off RM2,000 on the principal at the end of the year. At this point the promoter will keep trying to tell you its a real sweet deal. 2Gs once-off interest on 10Gs packed for one year....that's 20% return. Or is it ?? The golden rule with any get rich scheme is that if it sounds too good to be true, then it almost always is..... LOL Trouble with this crap scheme is while you are so blinded by that '20%' shining on your face, the contract obligates you to deposit RM10,000 each year for 6 years. They will still pay you RM2,000 once-off on each of the RM10,000 but you are tied to their plan for 6 years and no interest accrues on the earlier deposits. You are limited to RM2,000 once-off interest on each RM10,000. In simple maths :- RM10,000 x 6 = RM60,000 total investment RM2,000 x 6 = RM12,000 total interest over 6 years. Effective Interest per year = RM 2,000 (ie. 12,000/6) Effective interest rate per annum = 3.33% (ie. 2,000/60,000) In short :- RM60,000 of your money is legally locked in with them for 6 years the moment you inked the contract even if you only deposit RM10,000 with them each year. the fact that the interest on each RM10,000 is non-accruing and the interest payment is a once off affair on each RM10,000 at end of each year means your total effective interest is only 3.33% and not 20%. 6 years is long time to pack any money and if by chance you need to withdraw prematurely before the contract term is up, they will penalize you. At the end of the 6 years, they will also be ancillary costs within the contract terms which also means you do get back your full RM60,000 principal. You could have easily get the same deal at much more favourable terms by packing RM60,000 for just one year at the going FD rates which is 3.xx% . So what's the moral of all this ? Never trust the f$$king banks. Most bank investment schemes these days are misleading pieces of crap. The fact that even a large local bank have the audacity to promote garbage like this should tell you that banks do not care about their customers benefit. On legal terms there is nothing illegal about that contract but it is definitely misleading, morally dubious and commercially reprehensible. Learn to do your own investments and don't trust any freaking bank to do it for you.