Every year, more than $16 billion in dividends are paid out to investors. It was reported this week that there were $68.3 million worth of unclaimed shares and dividends still held in SGX, these belong to 83,000 investors. Among them, some 74,000 investors failed to cash their dividend cheques, amounting to $53.7 million in total. “In particular, one surprisingly forgetful person stands to be $1.2 million richer if he collects all his outstanding dividends.”
While the news may surprise many people, I find it hardly anything new. Two years ago, I wrote a blog entry “Common psychological biases among Asian investors“, I outlined common biases average investors have. One of them is called “Mental Accounting”. Ask yourself or your friends, have you ever recorded all your investment transactions and really penned down your profit and loss? I have met so many investors but none of them can show me an excel sheet of their past investments.
Some may argue that the brokers provide such system, but the reality is that many people transact through multiple brokers. The situation is worse especially in Singapore, where stocks are held in CDP instead of the brokers. I’ve yet to see a broker’s system to be able to capture information of dividends, rights, etc. If you also invest into unit trust and dividend or coupon paying life insurance policies, you will never know what you have until you really write them down.
In fact, stocks and dividends are not the only financial information which people lose track. Many do not budget and have no idea of their own monthly expenses and outstanding debts. That is why “money is not enough” until you count it.
There are even unclaimed insurance maturity proceeds and death proceeds. Most of the insurance companies publish these data in their website, and the list is astonishing long.
The news is a wake up call to many. Probably you should turn on your computer and start to record your personal finance from today. But the first thing you need to do it to check if you have any unclaimed shares or dividends. You can simply visit www.sgx.com/mygateway or call 6589 8039 (8.30 am to 5.00 pm Mondays-Fridays, 9.00 am to 12.30 pm on Saturdays). SGX will waive the administrative fee for the re-issuance of dividend cheques and dividend crediting until 26 January 2014.
Check for your spouse and parents too!