Hi jeff_ckf,

Thanks for you explaination.

I just received the offer letter from the new company. I was also informed by the HR of the company that the EPF portion contributed by me is 11% of my salary. However I can chose to pay 8%. Whereby the company will pay another 12% for EPF. As the EPF's return is not that attractive, I prefer to contribute 8%, not 11%. As a whole the total contribution to EPF is 20% then.

Hi Eelinkim

If something sounds too good to be true, you have to think more about it. Anyway, who knows there might have such too good stuff for us to explore and dig out? So it's your own responsibilities to make sure you know more your investment.

Hi kevinwcm,

I would suggest to invest into stock market. Do your home work by researching the listed companies' annual reports and find out potential and good quality companies then invest your spare money into those companies. After investing your money into those companies, treat them as your own business and keep the investment for long term. Then pump in stock market whenever you have extra cash, later you will find you have accumulated and growth your wealth with the stock market.

If you are a newbie to stock market, maybe you should 1st start to look at blue chip companies. I can also recommend you to buy a listed close-end fund, i.e. icapital.biz Berhad of which NAV grows at an annual compounded rate of 19%.

Yah I think WhiteWing should have cut some of the laptop/handphone installments if you are really desperate. Don't forget, you still not add in the transporation cost. We assume you do not use the car to travel to your company, but you still need to spend on public transport right, unless you are working to the company of which is close to your home.

Below is my opinion:-

Car loan : RM 352 ( I drive VIVA only ) (Not going to advice you to sell the car otherwise you will incur losses and still owe the bank though you might be paying a lower installment subsequently. Since your dad's loan going to finish in a year, so you pray u can tahan to pay this 352 in the next 12 months)
Life Insurance + Medical Card : RM 100 (100 in insurance is minimum, should keep this)
My bro laptop installment : RM 91.58 (i'm assume you are helping your younger brother to buy laptop and assume your younger brother could be in college so he needs a laptop to do homework, ask him to work out this part himself, ask him work part time lah)
My own laptop : RM 242 (if really desperate, sell your laptop and use your brother's laptop)
Digi broadband : RM 88 (broadband is not that important, cut this and transfer to your food expenses)
My hp installment : RM 135.75 (I assume you are paying installment for a fancy phone cost about RM2k? sell it if you desperate, so you not only got some cash to sustain your live style for the next few months till clearing your dad loan, you also lessen your burden of paying 135.75 no more each month)
My dad loan ( only end at December 2011 ) : RM 1,077.94 (I don't know what happen to your dad, hope it wont happen again or else you have to find another higher pay job to cover this portion)
Handphone bill : RM 100 (i think this part is high, if can cut by half)
Food : Don't talk about even .. cannot even think. (don't be too harsh to yourself on food, if u sick becuz of lacking of nutrient, you will be more into trouble)
Food : Don't take breakfast,lunch sometimes eat bread,if can go out and see customer,can CLAIM , at night eat roti canai

The discuss of applying TA into investment is off topic from personal financial managment. Any further discussion about TA should be in other thread, not here.

When people ask about how to efficiently utilise the spare cash on hand, so we could suggest few asset classes such as securities, properties, unit trusts/mutual funds and fixed deposit.

IMHO, I think those who is not savvy in financial knowledge, I'd recommend them to go for trust fund. Of course, picking a right trust fund is ultimate to grow your fund, and who is the fund manager is the most important factor to be sucess in investing unit trust. Check the fund track record for up to 5 till 10 years.

Another factor we need to take into account while investing trust funds is the fees incurred. If the trust fund is to benchmark with certain index like KLCI Index, but the trust fund's return is equal or less than the benchmark, so after deducting the fees the return from the trust fund is indeed lower than the benchmark. Then it is recommended to buy index fund.

I'm not sure how TA works nor I interested to know about TA. I'm also investing currently but I don't rely on TA. I'm more tend to buy and hold for long term and my investing strategy is value investing. Since I'm buying for long term, I don't think TA will work for my style. Please take note that the world 2nd richest man Warren Buffet is the only genuine investor in the top 2 richest (he could be now or in the future to be out of 10 most richest since he is donating most of his wealth), but he does not depend on TA at all. He follows Benjamin Graham's advice strictly as Graham had once said "Investing in a stockmarket is most intelligent it is most business like". If you are getting into a good business by spending RM20 mil and sell it the next day for RM22 mil and make a 10% profit, and it is indeed what technical analyst will prompt to do so. But I believe if Warrent Buffet works in this way by selling 10% profit each time within short term period, I don't think he would be as what he is today.

Since it's the thread for those who have questions on how to utilise their cash instead of putting into FD, apparently most of them are beginners in financial world so we should give recommendation or suggestion to be simple and neutral. Don't have to say TA or FA or whatever other investing methods is more good for doing investment.

Moreover, the discussion about the what so-called TA or FA doesn't seems match the topic in this thread. Thus I think it's appropriate to move those TA discussion to those investment thread.

This post has been edited by kinwing: Oct 10 2010, 05:56 PM

As I noticed someone is trying to over-emphasis on TA, so I brought Warren Buffet as one of the FA type to neutralise the investment style. Whether anyone should have agreed how Warren Buffet works his way out base on Graham's theories or any other investment guru such as philip fisher, it is always up to them to find out the topics instead of some one is trying to sell something too hard over here.

---

Added on October 11, 2010, 12:46 amI'm not sure if the discussion is leading to a genuine one. I always noticed some one who is promoting something too hard in the forum (not only this forum, any other forums that I been also caught in this kind of promotion).

For example when one is promoting TA analysis, and some forumers who are interesting would post more queries and they would be told to PM or email. Then the forumers would be told in the PM or email to buy a TA software with a cost of few thousand Ringgit. Or those who are interested about the timing strategy and they are led to the direction that it is a good timing to buy. When the forumers ask what to buy since it is good time to buy, they were told "buy Public XXX Fund lah, PM I will help you this". Don't you smell something fishy over here?

This post has been edited by kinwing: Oct 11 2010, 12:46 AM

After starting to work for 3 weeks in the new company, I'm now making some adjustment on the monthly budget

Salary = 3,500

Bonus = (Unknown. I will save all the bonuses anyway if rewarded)

EPF = 280 (=3,500*8%. I choose to pay 8% salary for my own EPF portion, whereby the company will pay according to the statutory rate.)

Home contribution = 350 (=3,500* 10% salary to parents)

Food = 540 (=18*30, previously i planned 5 per meal and 15 per day for food, however I don't find any cheap restaurants nearby Jln. Raja Chulan, so I have to fork out 3 extra for lunch. Maybe after I get use to the working environment and know which restaurants or stalls provide economic and cheaper food other than going to Pavillion, then only I can spend less on lunch…>_<!!)

Rental = 300

Transport = 100 (I have decided to defer owning a car. Now I walked from home 10 min to LRT station, and take LRT to KLCC. After that I walk another 10-15 min to reach office, just treat it as an exercise.)

Insurance = 250 (might plan to cut 50 on insurance the new company provides some kind of insurance coverage for the workers)

Internet+phone = 100 (=hand-phone prepaid of 30 + celcome wireless of 60, make the sum total approximately 100)

Investment magazine subscription = 60

Others = 120

So each month I can save RM1,400, of which could have exceeded my previous plan to save 20% of the salary after deducting car installment+car expenses. The reason I aborted the car plan is because I plan to save up to 50% of my salary, too bad that with current pay I can only make it max to 40% with my best effort. I hope after going through the probation or working a year in the firm, I could have achieved the 50% savings plan with additional salary increment then, assuming my expenses will not increase in tandem with the increment.

My next move is to save for a 3 to 6-months emergency fund ranging from RM6,000 to RM8,000. After achieving my plan for setting up emergency fund in the next 5 to 6 months, then only I can take the subsequent savings to continue accumulate my investment portfolio.

Currently I have about RM3K sitting in cash+savings a/c. I have not much cash because I have been studied for the last 2 years full-time, just spent about RM4k recently for buying a new PC and new stuffs for the new job and I was over-investing during the bear market.

Before starting this new job, I have been working for 4 years and then continue further full-time studied a professional certification for another 2 years. Just completed the study 2 months ago and now come out to work again.

The professional certification exam that I was taking in the last 2 years is the CFA program. It is indeed designed to be a self-study program but it requires the candidates to commit a lot into reading. Afraid I cannot handle the study while working, that why I decided to take the program full time.

Of course there was another reason I quit job and full-time study. It was because my ex-company (an IT firm) was not doing well during the financial crisis which happened since year 2008. The management of my ex-co. had declared there would be no bonus for the next 2 years and salary increment would be ceased for at least a year (According to what my ex-colleague had told me after 2 years I left the company, he had not received any bonus and salary increment for the 2 years).

Thus I decided to resign from the job at July-2008, and I knew it was not easy to find another new job during financial crisis, so I decided to make a full commitment into studying and hoped I would complete the program as soon as possible, and if I completed the program in the next 2 years, most probably the world economy should be recovering and thus it would be a good time for me start to look for financial related jobs, this was what I planned during the last 2 years.

I'm now single, and I'm not a smoker nor heavy drinker. Since I have no car to drive out, so I wont go out entaining too frequently. Maybe every friday/saturday night I will vbe out to play dota with friends for few hours but I don't think it would cost me alot. Or I would go and shop at KLCC/Mid-valley (since they are accessible via LRT/KTM) during weekend, most probably I might buy a book/magazine to read or watch a movie, I think that won't cost me alot as well. And I have a habit of treating myself to have nice food in good restaraunts once a 2-week, normally I don't spend more than RM30. And all these extra cost on food+entertainment are taken care by the "Others" categories of which I have put in a budget of RM120. Of course sometimes people mght over-spend due to unpredicted circumstances, I'd try to control the over-spending amount below RM50 to RM100 of which will not seriously erode my saving plan.

BTW, my emergency fund is based on my monthly expenses, not salary. Currently my estimated living expenses are RM2,100. By taking the EPF portion of RM280 out from the RM2,100, then my non-working living expenses would be RM1,800. So my 3-month to 6-month emergency fund would be ranging from RM5,500 to RM11,000. Most likely I would be taking the 3-month plan.

This post has been edited by kinwing: Oct 27 2010, 05:58 PM

Hi PPZ,

If you mind to read my previous thread, indeed I'm working now , just started to work no more than 1 month.

hi PPZ,

If you don't know much about investment stuff, you should put your hard earn money in FD. Try to learn and know what kind of investment in the market, their risk and return, and know how to compute the return, then only you could make your 1st step to invest with a small amount to gain experience. After gaining experience and you are comfortable with the investment tool that you engage, then only start to invest more.

Hi yuunasue,

With the saving of RM2K each month, I believe the house cost RM100K is affordable to you, assuming that you borrow 90% loan and have at least 3-month emergency funds in FD. If you plan to rent out some of the rooms in the house and collect rentals to pay part of the house mortgage, it's even better.

Since some of you are so keen into investment, maybe I can recommend you to have a look on this close-end fund, i.e. icapital.biz berhad. This fund is listed on the main board of Bursa Malaysia. This fund was launched since 19-Oct-2005 with a NAV per share of RM1, it does not pay any dividend but it's NAV per share is about RM2.47 today. This fund is investing Bursa Malaysia whereby only no more than 10% of its fund should be put into unlisted companies in Malaysia.

Since this fund does not pay any dividend, we can use the money weighted average return method to calculate it's return. As it's fund NAV per share grows from RM1 to RM2.47 since last 5.04 years (which means if you put in RM10,000 into the fund 5 years ago, it would have doubled your wealth to be RM24,700 today), the fund's return on the NAV is shown below:-
NAV average compounded annual return (for 5 years) = (RM2.47/RM1)^(1/5.04) - 1 = 19.65%

Some of you might claim that close-end fund will not be traded at it's NAV because it's a norm for a close-end fund to be traded in discount, then we can look at the ICAP's return base on its share price (which is around RM2.04 now) to get the ROI as stated below:-
ROI average compounded annual return (for 5 years) = (RM2.04/RM1)^(1/5.04) - 1 = 15.2%

IMHO, I think a fund with the return of 15.2% each year is quite good, and it bits the KLCI benchmark quite handsomely. Of course, we should not only look at the return but also the risk side. This fund is investing shares in Bursa Malaysia, so it's NAV and share price could be volatile. In order to make profit from this fund, investors should plug in money in this fund for long term. Let say if an investor put in money 5 years ago and sold 3 years later at 2008/2009, he can only makes an annual compounded return approximately at 6.3%, if wait another 2 more years he can make a higher profit.

You can find out more about this fund from the ICAP's and Bursa website with the links stated as below:-
http://icapital.biz/english/
http://www.bursamalaysia.com/website/bm/li...ments/index.jsp

BTW, I hereby disclaim that I'm the shareholder of ICAP, so anyone who invest in ICAP now could have positive impact to the share price and this could indirectly benefit me...

Below is the attachment that showing the performance chart and table of this fund.


Attached thumbnail(s)

IMHO, owning a car due to poor public transport and increasing criminal case are lame excuses. If people wanna get out the rat race, which is the main purpose of having this thread, they must be creative. When people blame it is not convenience or not safe without driving car, then how sure the people know driving a car is safe also?

Please think of other better reasons to justify the intention to have a car. Driving a car was previously a privilege right that people have to go through a very high standard test then only they can get the licence to drive, and owning a car needs well financial planning for years. Now Malaysia drivers' standard are so low that everyone including a blind man think they deserve a right to drive a car, so do you think driving nowadays is safe? Now we see a bunch of college students and fresh graduates think they "need" a car to ride to school/work without having the earning powers to afford a car.

LOL .

This post has been edited by kinwing: Dec 1 2010, 05:18 PM

Hi all,

I am 28 this year and working in KL. My monthly salary is RM3.8k and estimated extra RM300 to RM500 sales bonus monthly. So after deducting monthly expenses, tax and EPF, I could save range from RM1.6k to RM2k. I don't have a car and am currently renting a room at PJ, so I am taking LRT go work at KL everyday.

Whereby my personal balance sheet is shown as follow:
Investment Portfolio = RM140k (estimate market price)
1.8 acres land at Ipoh = RM200k (estimate market price)
1 double-detached storey house at Ipoh (share with elder brother) = RM160k (estimate market price)
Savings/Fixed-Deposit in Bank = RM8k
EPF = RM36k
PC Installment = RM1,000 (To settle RM200 per month in another 5 months)

As my mum is retired, so she plan to come to stay with me or my brother in KL (mum and dad are divorced and they are not staying together in Ipoh). Mum also told me as I am not young anymore, she hope I should start to plan to buy a house in Klang Valley. However, I am quite reluctant to do so as I think the price of landed houses in Klang Valley is over-priced and with my peanut salary I feel like not able to afford a house with the price of RM400,000 to RM600,000, and this is not even take into consider of renovation .

However, not to disappoint my mum, I have discussed with my brother and we decided to sell the house at Ipoh. Hope we could then get the proceed of selling at the house and then buy a smaller single storey detached house with a cost range from RM80K to RM100K in Ipoh for my dad to stay. (Dad is currently staying at the house in Ipoh and he gave his consent to us to buy a smaller house in Ipoh for him to stay since my brother and I are currently working in KL and my younger sister is going to complete her college study soon and will start to look for job in KL/PJ, so we seldom back to stay in Ipoh, and it is very difficult for dad to keep taking care a bigger double-storey house). With the extra RM60k，my brother would then try to look a house in KL or PJ with a price within RM300k to RM400k, then he could pay 10% to 20% downpayment, and the remaining amount would be secured via housing mortgage.

However, my mum was very upset when I informed her what we have planned yesterday. She told me I should liquidate my investment portfolio and the land so I could use the proceed to buy a new house, then we won't be worry about to payback mortgage installment every month. Although I have kept telling mum that my investment portfolio has been making a good return of 18% to 20% annually, and this return could be higher than the mortgage rate. But mum then questioned how high the return of the portfolio could have if compare to the return of owing a house, as she is in the view that price of a house could appreciate much higher than any investment tool. I can't answer my mum at that moment as I don't know what is mortgage rate currently .

In view of this, I would like to seek for your opinion that what is the housing mortgage rate currently if my brother is going to take a mortgage loan of RM340k to RM240k for 20 years, and how much he needs to pay the installment monthly? And is that possible for me to own a landed house in KL/PJ with a budget within RM400k? And I also aware that I can take out some money from EPF to buy house, so how many I could withdraw from my EPF account with the amount of RM36k? This is the 1st time I want to buy a house in KL/PJ, and I don't have any idea of how to get an affordable house in this area, so I need your advice . Thanks.

This post has been edited by kinwing: May 21 2011, 03:11 PM

hi munkeong,

I am more confident in economic and company analysis when I am doing research for my portfolio, but I just not interested in properties investment and thus I have no much idea of knowing where to get the relevant information of buying an ideal house. Thanks for your information on the housing mortgage.

Looks like taking the installment for 340k mortgage with 6% for 20 years does cut into the pocket by more than RM2.4k per month. So I have to look for a cheaper department instead of landed house so to borrow less, or extend the repayment period from 20 years to 30 years:(.

Just do some simple calculation by assuming that my brother buys a house and will pay RM2.4k per month, so after deducting the saving of rental of RM700, there is still a cash outflow of RM1.7k per month or RM20,400 per year, which is almost my whole year savings. And my elder brother is earning less than what I am earning, so I don't see the point of taking 340k morgage for 20 years. Furthermore, I don't agree to my mum's thinking that buying landed house is an investment as it will appreciate in price more than other investment tools. Even if the price of the house has increased, are we willing to sell the house and move to a smaller house instead? Buying our own house has never been considered as an investment choice to begin with in my view, as I know I might end up putting in a lot of money for renovation which could cause me to dispose the house in losses in future.

I have made up my mind, I told mum that either we buy a cheaper apartment instead of landed house, or we wait the landed houses' price to drop (my view is that house prices in Klang-Valley are at least in the stage of bubblet, if not bubble), or I have my salary to double in the next few years, or I need to roll my investment portfolio to a bigger size in next 5 years before consider to own a house in Klang Valley. I just cant kill the "golden goose" by liquidating my investment for the sake of the "sense of security for not to worry to pay monthly mortgage installment", just like my stubborness not to own a car unless necassary for work. Owning a house at a very young age involves a big chunk of opportunity cost, this is what makes me to stand firm my point when talked to mum.

Regarding the savings part, assuming I am unemployed and will back to stay at Ipoh. My monthly expenses in Ipoh was less than RM1.3k when I was full-time studying for 2 years from 2008 to 2010. Without committing to any additional liabilities since start to work for 8 months from last year October, thus I can confidently assume that RM8k of savings is more than enough for me to survive in Ipoh for half-year. Of course, it would be different story if I take up mortgage loan

This post has been edited by kinwing: May 21 2011, 07:01 PM

Hi groggy,

I commenced to invest when I was 21. The first 2 years return was not that great, but gradually I come to learn an effective way, in my opinion, of making sustainable return by applying value investing. I invest in equity market and hold my portfolio disciplinarily, buy at very cheap price during bear market and sell at a very good price during bull period. Maybe my capital is small and do not have much impact to the market whever I did the trading, so I am able to take the advantage of irrational market by applying value investing and thus making compounded return of 18% to 20% annually for the last 7 years.

For your information, I have bought a company share with a cost of RM1 and hold it for 4 to 5 years till it increased up to RM5, in another case I bought another company for 4 years at RM2.90 before it increased up to RM6.3, so it's all about discipline and patient when come to invest. I have never dreamed to make few hundrend percent within short period, I just wanna acheive compounded 15% to 20% return annually so I could double my wealth every 4 to 5 years, as simple as that.

Of course, I have finance background and working in the financial field and these provide me a good fundamental of how to find out a good investment.

This post has been edited by kinwing: May 21 2011, 11:24 PM

I am 28. Yup, I am single and no expensive hobby so my living expenses could be low .

Below is the breakdown of my last year monthly expenses in Ipoh:
Food: RM420
Stremyx: RM100
Phone: RM30
Home Utilities: RM50
Insurance: RM250
Contribution to parents: RM300
Transportation: RM50
Others/miscellaneous: RM100
Total: RM1,300 per month or RM7,800 for 6 months