Personalities and character is what makes a man. Wealth does not. Wealth can be easily built, reputation can shatter with one wrong move.

Back to the silver spoon thingy.... compared those who have no opportunity to study overseas and have to take up massive education loan just to study locally.... what spoon did you think they got? Kayu? Aluminium? Glass?

Also a lot of working people have no choice but have to pay for their parent's and siblings expenses. Did you do that?

There much more to life than wealth.... otherwise the world with turn into one huge materialistic, capitalist mess.

This post has been edited by gark: Jan 12 2013, 12:06 PM

Yes a poor man can become wealthy, no doubt about it. But these that really come from rags to riches and not silver spoon to richers and way much more careful in spending their wealth which they get from their blood, sweat and tears.

I am not arguing on the wealth generation, just your view that having wealth must be spent which is way misguided. WB donated 90% of his wealth to charity. Why didn't he buy the entire Ferrari company (he can afford it, heck he can buy all the luxury car company) but choose to give out all his money. His children only got like 5% of his wealth. That speak volumes about his character. Wealth is not a means to an end. If you think by having wealth means respect, you are also wrong.

Anyway nice conversation with you but I have to end it now otherwise we are spamming the thread to help others achieve their financial freedom.

I hope you can really achieve your riches and buy several Ferrari's with pretty girls in tow. Good luck!

This post has been edited by gark: Jan 12 2013, 12:19 PM

"If people paid more attention to how they spent money, they could spend less, it contended; if they spent less they could work less; and if they worked less they could focus on things that meant more to them than accumulating possessions."

Good insight, good to see from the other perspective. Rat race is getting tiring...

This post has been edited by gark: Jan 16 2013, 07:40 PM

Why need to impress others? As long as you are comfortable with yourself, why bother what everyone thinks?

But that being said, no need to dress like a hobo.

I think you have a skewed way of looking at life, money and investment which is not so healthy. If you continue with your thinking you might not achieve what you want in the end.

If you want to aim to earn more money, yes that is one way to be financial independent. The more harder you persevere and you get more income. There is nothing wrong with this and is highly encouraged. Next you scrimp and save, which is worthy as well to increase your wealth. However if you don't get your money to work FOR you, sooner or later something called inflation will come and take it all away bit by bit.

However you are missing the big picture. Most do the above as a stepping stone to achieve financial independence. Financial independence is achieved when the day you realize you can quit your job anytime (only if you want to) and you have more than enough to live on. Thus work will no longer be a burden and a multitude of choices is open to you and you are no longer 'enslaved' to work and money. You have earned your freedom, you are free to choose.

To achieve financial independence you need to go through several stages.

First stage is accumulation which I think you have a pretty clear idea of and indeed you might be doing better than a lot of young people. This stage involves concentrating to increase your income & wealth (hard work, business or investment) whichever route you prefer and lowering your expenses.

Second stage is passive income, in which this makes your money work harder for you. You should have a clear and concise investment plan to achieve the minimum income you desire and aim to achieve that with long term investment plan. These investment could be private equity (business), bonds, UT, REIT, dividend stocks, rental property, etc etc on a long term view with income generation. Do look out for the big enemy called inflation which will take a chunk of 3%-5% every year. Risk should be managed and embraced and not shunned.

Last stage is financial freedom, your poor overworked money (they don't rest! ) will start to contribute income to you and once those income match or exceed your expenses or regular income you are done. You have your freedom to pursue anything you want from now on with no more worries about money.

This is not a dream, many have achieved it, but it requires a lot of discipline to do so and have a consistent & long term view on investment.

Some lucky persons will achieved financial independence in a short time, some take 10 - 20 -30 years but most will never do so as they lack the will to do so.

So which group are you in?

This post has been edited by gark: Jan 22 2013, 02:19 PM

Err sorry sifu!

PL interest rate is different from most mortgage reducing rate, so the effective interest rate p.a. is much higher than stated.

Effective interest rate for PL @ 4% is about ~7.4% p.a. (our in-house accountant pinky can help us count )

PL @4%, 20K loan 3 years = 622.22 per month x 36 month = 22,399.92, total interest paid = 2,399.92

PTPN 20% rebate = 14K x0.2 = RM 2,800

You only save like RM 400 for 3 years.

This post has been edited by gark: Jan 22 2013, 06:35 PM

PL interest is calculated up-front just like car loan, cannot use reducing principal calculation. Bank also want to cari makan what.. if give you 4% reducing rate want to makan apa?

This post has been edited by gark: Jan 22 2013, 06:37 PM

Well technically he say company personal loan . This kind of 4% loan is very common in GLC/govt institution working together with major banks. The payment will then be cut directly from salary.

A lot of people has been conned to think they get better interest rate. Typical sales talk is "only 4% mar a bit higher than FD only what, special for GLC employess only u know..."

If really he means company benefit loan, then by all means go for it.

This post has been edited by gark: Jan 22 2013, 07:05 PM

You know why those old men will not own a merc? Because they know that a car is not an asset but a liability.

I have a medium priced car <100K, yet i rather spend my money on properties/investment that generate monthly returns.

Lol if I liquidize all my investments, can buy more than a few luxury cars.... but I choose not to do so. It is my choice to make right?

Not everyone will spend money if they have it, it is usually those who have easy come easy go attitude, who have not sweat blood and tears on their hard earned money.

I would say let those who live a frugal lifestyle has it's own merits, so no need to keep advocating on splashing the/your wealth on 'things'.

You must not have seen real millionaires yet right?

I know a owner of a big listed company (which is still listed now), he is worth billions of RM (yes billions, not million), yet he goes to the wet market, live a simple frugal life, enjoy kopitiam meals, washes his own cars (a medium priced sedan), goes around in shorts and t-shirt. He is very humble and well respected.

On day he arrive at one of his factories, alone, with simple attire, in his own car and want to go into the factory. And the security guard refuses to let him in, even after he told the security several times he is the owner, but the security guard did not believe him from his outlook. Then he told the security guard he wants to see the GM, the security ask him to wait and confirm with the GM. He sat on the bench like every other worker and wait for his turn to be called. Once the GM heard his name, the GM ran down from the office to the security guard post where he was quickly ushered into the office and tell off the security that he should recognize the chairman of the board. Instead of getting a scolding, the chairman gave the security a hefty pay raise for not letting stranger into the plant and upholding company rules.

This post has been edited by gark: Jan 25 2013, 10:27 AM

Yes you are right RM 1 million nowadays is noting much to shout about. If you have at least 1-2 properties and debt free, you are already a millionaire. In Malaysia generally accepted term to 'feel' rich net worth is at least 1 million USD figuratively speaking.

You are also right on the some of the millionaires spend and some don't. Some choose to save and some choose to spend. There is nothing wrong with that. Life is all about the choices we make.

It is just that you should not impose YOUR choices on others who CHOOSE to manage their finances differently. Hence either to scrimp and save and to spend lavishly is within their own right.

If you think you have to spend lavishly when you are rich, then go ahead, but never look down on people who are savers. Each has it own ways of enjoying their wealth. Some enjoy by just seeing their wealth goes up.. instead of spending it... some enjoy spending it and accumulate 'things'.

"Do you know the only thing that gives me pleasure? It's to see my dividends coming in." - John D. Rockefeller, the first American to amass 1 billion dollars.

This post has been edited by gark: Jan 25 2013, 01:32 PM

It's always easy to say rather than do. When actual money is involved, emotions comes to play. There is no low risk high return, companies can go bankrupt and delisted as well.. so lower can become lower until zero. By proper investing and diversification, you can only reduce your alpha risk but not your beta (ie. global/constant) risk.

By all means minibonds and CDO is percepted to be high income and low risk (high interest, AAA investment grade) until it blows up...

Also as in Value investing, the price of stock is irrelevant even it is RM 50 or RM 100. What is important is the value of company in relative to the price.

Some time in short run ie. 2008-2010 period everyone thinks they are master share investor with gains of over 100% as they caught the low, but looking at bigger picture and longer period they may not be always so lucky.

To get constant 20% per year is near impossible, the best investor in the world (WB) is only averaging around 20-24% p.a.

Value investing is a good concept, but IMHO reasonable assumption for equity gain should be only 8%. This is so you do not overestimate your 'earning' power. For retirement purpose best to assume 4% income rate to have proper buffer before you decide to take the plunge.

This post has been edited by gark: Feb 22 2013, 12:46 PM

Yes as you say yourself over the long term and with higher investment amount, you will not get 20% constantly. Good for you to get 20% CAGR for the past few years, but stating that high income with low risk is not correct. Stock market is high risk, you may be lucky to flip several coins in a row to get outsized returns but that does not mean that you will get the same flip year after year. Stock market is high risk and high gain, the risk is measurable by votality, so it is not an implied risk. By stating your view, you might inadvertently encourage people to think that stock market is a free lunch, which it is not, it is dangerous and required loads of hard work to make it work. It is not for everyone, especially those with low tolerance for risk.

If you start investing in the 2000's 20% CAGR is not a problem until now, my investment gains more than doubled when I start investing in 2006 until now, but as you say the higher amount you have you will feel the constraints. But who knows on the future, anything might happen, so taking 8% long term view on equity and 4% withdrawal rate is prudent financial practice. Since you are a student of Graham & Buffett, you should be familiar with the quote 'margin of safety'.

This post has been edited by gark: Feb 22 2013, 02:15 PM

Have you consider using penang rapid to go to work? Convenient and cheap wor...

If you can increase to RM 400 savings a month would be very commendable already and start to invest (4,800 a year). Later with yearly increment, you will have more income for property investment etc.

IMHO 16 months gross income is a bit overboard for emergency funds, but I see you have kept some in ASB. I would rather keep only 5 months in FD and 1 month in savings account, with the rest in ASB. Investment in ASB is not really considered emergency funds and is more like investment.

Since you quality for ASB, suggest you max up your 200k ASB contribution before you consider other investment. ASB is the best risk adjusted investment out there.

Hmm ...

If sole breadwinner, but monthly passive income > monthly expenses, then 1 month emergency more than enough? Or no need to have emergency fund...

This post has been edited by gark: Feb 28 2013, 02:29 PM

Hmm... how did you get ASB if non-bumi? Loophole?

Or you meant ASM, ASW... etc?

This post has been edited by gark: Feb 28 2013, 02:34 PM

Wah ... u really 'kiasi' leh Can think until this scenario...

Think of the tiny tiny % it will happen to you, if really happen accept fate lar.