Folks,

If someone borrowed money at 6% per year and then put in the money investment that ONLY pay 3% per year, the person is GUARANTEED to lose 3% per year. Now, isn't that a LOUSY INVESTMENT??

Similarly, if person is borrowing money at 6%, why would a person used that money to INVEST on something that only pay 6% per year?? Won't any investment has to have return a lot more than 6% in order to be worthwhile?? Especially, if it is NOT a risk free return.

Many people has a housing loan that costs 6% per year. They could have prepay a portion of the loan and save 6% per year. But, they INVEST on stuff that GUARANTEED to pay them ONLY 3% per year. They MAKE SURE that they LOSE 3% per year. How smart is that??

Dreamer

emergency money is very very very important....cant stress it more..

This post has been edited by ah_suknat: Oct 19 2010, 08:54 AM

ah_suknat,

FD is not for investment. It is for EMERGENCY FUND.

I am TALKING about stuff cannot be used for EMERGENCY FUND aka INVESTMENT.

There are ONLY 2 kind of money:

A) Emergency fund

B) Investment

(A) has to be liquid aka can be used at ANY time. Anything else is an investment.

Dreamer

This post has been edited by dreamer101: Oct 19 2010, 08:57 AM

I wouldn't suggest FD , should invest in mutual fund or something similiar .

Else the inflation will kill your money.

Blindly investing in whatever without any knowledge would kill your money even faster. Generic blanket statements are never the answer. Risk vs reward is always there.

if u wait until property bubble to burst then u need to wait very very longgggggggg...time.
while waiting u will loose many opportunities.

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Added on October 19, 2010, 2:55 pmMost of the Housing loan is BLR - x%, say BLR - 2%, which is 4.3%p.a., ASM/ASW2020/ASD pay 6.3% at lease, why u think it is viable to pay more in your housing loan instead of saving in PNB products???? I have a friend have a hse worth 600K, her outstanding mortgage loan balance of RM140K, she refinance her hse with 90% MOF, she get 540K financing from the bank, the additional money of 400K (540K minus 140K), she dump in ASW2020, just earn the interest difference of 2% ( ASW2020 return of 6.3% minus the mortgage interest of 4.3%p.a)

FYI, Mortgage is the cheapest loan that available in the market.

This post has been edited by cheahcw2003: Oct 19 2010, 02:55 PM

Hi all,

I am a 23 years old degree graduate and currently employed by a bank for around 2 years with a basic salary of RM3k per month (previously RM2.8k) and still living with my parents which they take care of all the household expenses.

My rough estimate of my monthly expenses are :-

Travelling expenses (fuel and tolls) = RM300
Season pass for car park = RM100
Spending on girlfriend and with friends = RM550
Saving put aside (just started recently) = RM400~RM500
Hobby = RM300
Lunch/dinner = RM500
Entertainment = RM250

Misc personal debt = ~RM1500 (loan instalment and handphone bills).

No personal insurance (borne by my mother) nor car loan (fully financed).

Although I am being prudent and giving the higher side of the estimates, I usually have nothing left near the end of the month, given that there is also the deduction for EPF.

I believe I can cut loose and reduce my expenditures and I am looking to invest my money.

At the moment, I have been reading about stock tradings and partially researching on underdevelopment properties.

While I am still looking out for the right property to invest long term in, I was thinking about doing some other form of investment and what came to my mind was stock trading.

Would some kind forummers help out in suggesting or advising how to invest my money ?

if u cut down on spending on gf, hobby and entertainment, you can save more. it looks like you have quite an expensive lifestyle.

Based on your current expenses and living style,it's better that you try to figure out how to reduce the expenses than how to do investments.
I so wish my parents can pay my insurance and my cars as well.

learn how to cut down your expenses instead of asking people for advise
did u know where did u got your money to invest while u don't have any saving?

he doesn't ask how to invest his money ...

his problem is he spend all the money and hard to make saving ...

so put into FD is a better way for his problem now but to earn more money and counter inflation is his own finding already ...

This post has been edited by Ken: Oct 20 2010, 09:13 AM

To the three replies above, my point in this thread is seeking for advices on what instruments to invest my money in and not on how to reduce expenditure.
I have control over my finances despite my high expenditure as posted. The info above is referring to expenditure on really happy go lucky months where I go and spend without much consideration since I have already put aside my targeted savings per month.
And I know it is not good and contributing to my future, hence I want to put them into something more productive

So lets say that I am able to cut expenditure and able to put aside RM1,000 or RM1,500, I need suggestions on where to put this money in instead of a simple savings account which generates nothing in the end.

It is save to say that I will be able to cut back on expense of such amounts because I have done it before because I wanted to see if I am able to commit to monthly housing loan repayments. I am still looking for my desired property to invest in, so I have this kind of surplus for some time being.

Yes, Ken. That is what I am seeking all of your help about. Not to save but how to invest my extra allocated money in.
Can I still go for this ASN or ASM or are they already fully taken up already ?


Thanks everyone for your replies.

Agree wif zenwell, try to reduce ur expensive lifestyle. Save first enjoy later or u wanna enjoy first suffer later.

Like I said, earlier, my expensive lifestyle is totally adjustable.

I only need investment advices, not saving advices.

huhuhu nice 1 bro....

RedShirt,

1) Would you borrowed money at 7% in order to earn 5%?? Hence, losing 2% continuously??

You have LOAN PAYMENT. What is the interest rate?? If it is high enough and you can prepay without penalty, paying off the loan would be the best investment.

2) The STANDARD personal finance advices are

A) You need to save 10% to 15% of your gross income in order to financially survive

B) Until you have 3 to 6 months of YOUR EXPENSE saved up in EMERGENCY FUND, you DO NOT INVEST.

Have you satisfy condition 2 (A) and 2 (B)??

Dreamer

If you post in this thread, you will keep on getting saving advices, even when that's not what you want. Simply because this is a savings thread.

On the other hand, there isn't a thread on what is the best investment because there isn't one. Something to do with one man's food is another man's poison.

So you have to look through the existing investment threads and find one (or more) to post your next set of questions specific to those threads.

1) The loan mentioned above is a credit card payment which I have put on 0% interest monthly installments, which anyways, is fully repaid by end of November.

2A) Yeah, I have this.
2B) My expenses, huh ? This, unfortunately, is something that I do not have yet, as I like to be prudent and be on the safe side (I'd take the calculation of 6 months).


Well, by personal financial management and by what I said about investments, I thought that it would be a discussion on how to financially manage your savings/wealth so that you do not in the end, allow your savings/wealth to be eroded by factors such as inflation when you just dump it in a vanilla savings account, which defeats the purpose of managing anything to begin with.

And if you're saying that this thread's purpose is to tell someone to cut expenses and spendings alone, then you're right and I am sorry, this is probably the wrong thread to post in from the beginning.
My purpose was for someone who going through the same phase as I am, being in the early/mid twenties or those who have gone through my phase, to advise me on planning for some financial management for the savings that I have or that I will accumulate in due time for strategic purpose.

I do not have much obligations at the time being and I would like to maximize whatever I can instead of letting it sit in my vanilla savings account.

This post has been edited by RedShirt: Oct 21 2010, 12:47 PM

I currently 23 going 24, and going to start working soon with basic salary of 2600RM in KL. I already own two decent car loan free , and have around 80k units in ASM/AS1M with some FD. Should i continue keep my money with PNB or down payment for an apartment and rent it out later on ? If so, with my current salary range, how much of loan i can roughly get ?

This post has been edited by Cyclone87: Oct 21 2010, 03:52 PM

For investment part, we only talk about the investment method, aka the particular investment product issue discussion (like stock, properties, UT or whatever, which there are specific topic around which can join in the discussion ).
There is never a issue like, ok, I have saved 50K, I should invest in stock or properties, or which. There is no answer and pointless discussion if in this way.
That's why you see little discussion on this.

It is individual preference, choice of risk exposure. Nobody can advise on it.
It is same with the question what dinner should I take today. Only you knows.
Any investment may potential yield losses, instead of gain.

Some may prudent in spending and save a lot in FD, while he/she doesn't even know what is stock market about. So money sitting in FD is "right" for him/her.
Nothing wrong. There are many old generation people just prudent in saving and keep the money in FD, in the end of day save a couple of hundred thousand for their kids overseas study.

While another person may more adventurous invest in derivatives market, as long as the person is understanding the risk being taken, then it is fine.

Which is better? There is no answer of which is better than the other.

Financial management is about how to manage the available money, while investment part is about individual preference.

---

Added on October 21, 2010, 4:40 pmFor investment part, we only talk about the investment method, aka the particular investment product issue discussion (like stock, properties, UT or whatever, which there are specific topic around which can join in the discussion ).
There is never a issue like, ok, I have saved 50K, I should invest in stock or properties, or which. There is no answer and pointless discussion if in this way.
That's why you see little discussion on this.
It is irresponsible to put a recommendation for others, like hey, bro, you should invest in UT or stocks.

It is individual preference, choice of risk exposure. Nobody can advise on it.
It is same with the question what dinner should I take today. Only you knows.
Any investment may potential yield losses, instead of gain.

Some may prudent in spending and save a lot in FD, while he/she doesn't even know what is stock market about. So money sitting in FD is "right" for him/her.
Nothing wrong. There are many old generation people just prudent in saving and keep the money in FD, in the end of day save a couple of hundred thousand for their kids overseas study.

While another person may more adventurous invest in derivatives market, as long as the person is understanding the risk being taken, then it is fine.

Which is better? There is no answer of which is better than the other.

Financial management is about how to manage the available money, while investment part is about individual preference.


This post has been edited by cherroy: Oct 21 2010, 04:40 PM