i did say the data is just data, how the ppl feels is totally diff case

And that's why many Malaysians do not take savings & retirement planning seriously. That's also the reason why, most Malaysians do not have sufficient savings in their old age.

You do not use higher inflation figures only because it will show that none of your products will be able to overcome this inflation thus nobody will invest in them. So u downplay the actual inflation figures and use low figures. You are merely misleading your clients and that's the reason why I always tell people never trust financial planners. They will always downplay the real market conditions and try and sell you a product of their bank / financial institution in the end.


You cannot use long term inflation rates when the current inflation rate is much higher than that. And u are also wrong in saying that by assuming higher inflation figures, there will never be enough for retirement. That is again misleading. You can achieve a 10% ROI growth per annum with prudent investments. I am living proof of that and if I can achieve it so can anybody else.

In March 2007, my NAV was only RM196,000. My current NAV is approx. RM2.3mil. And im not someone who earns a super high salary. I just manage my risks, diversify investments and continuously review my investment portfolio every 3 months to ensure im getting maximum returns for every cent.

There is no feeling involved. The facts are clear. The inflation is MUCH HIGHER than the 4% claimed by the Gov. You don't need to be a rocket scientist to see this.

For the past 20 yrs until Oct 2016, the average inflation rate range from 0.85% (in 2009) to 5.25% (in 1998)
If budget were to b based on historical numbers, I wud use 5% as the key assumptions

+1
seriously government is covering up the figure..

you've experienced such high growth, that's some very powerful panning done there

yeap.

u have any suggestion on how to get started in managing personal finance?
for newbie like me, with very less experience in investment stuff.
currently im looking into investment in ETF (long term), and also invest into high dividend stock, any suggestion?
property investment maybe will come later

Many Malaysians are not aware of their position and hence didnt plan their future.

When come to retirement planning, you need to use a long term inflation rate because retirement planning is not for 1 to 2 years but for a term of 10 or probably 40 years! There must be a basis for 10% inflation and not just based on gut feel or based on certain product. Who can tell what is the nation wide inflation rate for the past 10 years? There must be solid data and sources to based on.

And to clarify, independent financial planner who do holistic financial planning DO NOT work for a bank, insurance or financial institution. Many people think that financial planner are those with financial institution selling insurance and bank products, that is what the bank portrays their "wealth planner" and insurance companies portray their "insurance agent" as, which is totally misleading. This is also one of the Malaysian problem where they do not understand what does an independent financial planner do and mix them up with those who works with the financial institution.

It is also not easy to achieve consistently 10% ROI p.a. long term, say, continuously for 10 years. U may get 10% consistently for 3 to 5 years, how about for the next 10 to 20 years? We are talking about annualized long term ROI.

It is excellent for you to be able to plan your financial meticulously and grow your NAV at your own. You definitely have certain level of financial knowledge to manage your investment consistently via reivew and maximising your return, especially the part that you are managing your risk very well.

Personal financial is not only about investment. It is also about managing your debt, your retirement planning, investment planning, risk management (like insurance), tax planning, estate planning, children education (if any). Because there is no point you investing in somewhere which the return is lower that the interest rate you are paying for your credit card debts and housing loan.

Cybermaster not only manages investment but risk as well. This is very important because the fact that investing in high risk products can mean risking your money that you might not get back your capital at all. So there is thorough study and research to be done before selecting the proper investment

Yes ure 100% correct here.

Investment is just 1 part of financial planning. Its pointless investing if your own expenses are not managed properly. Any ROI from investments will just be 'lost'.

The first thing u have to do is set a retirement fund target. Say RM2mil by the age of 50 for example. This will need to be based on a number of factors e.g salary, fixed expenses, debt levels, family needs, quality of life at retirement, etc

Once uve done that, u then work backwards and come up with a annual target to achieve. This will need to be weighed vs inflation, economic conditions, etc.

Once you have your annual target, then work backwards and set monthly targets.

In most cases, these monthly targets may be a bit out of reach. But that's the challenge question you need to ask yourself which is what do I need to do to achieve these targets?

First step is to closely monitor your daily expenses. If u don't plug the loopholes, you are still going to be bleeding unknowingly. For me, I do a expense check every week. If 1 week my expenses are high, the following week I immediately cut down to bring it back to normal. If u let it go out of control, then ure in trouble.

Once uve got this in check, then focus on what investments to go into based on your disposable income.

Remember the golden rule of investment:
The best investors are those who invest with the least effort, smallest capital, shortest tenure, lowest possible risk and yet make the highest returns.

So when u consider any investment, ask yourself if ure keeping to the 5 criteria above. Note that everything is an investment and there are millions of investments out there. But not all investments are the 'correct' ones to go into. Just because u're investing in something doesn't automatically mean ure making a profit. Every investment needs to be risk adjusted e.g making a 5% gain from a investment which has a 15% risk factor is foolish.

Keep in mind that even the best investors will lose money on some ventures at some point. Nobody makes a profit from everything. But the key is to invest in a number of product classes and spread the risk so that even if 1 goes down, u have another 2-3 schemes to cover that loss.

Remember the 4 step process about risk management:

1) Risk identification
2) Risk impact assessment
3) Risk probability
4) Risk impact mitigation

In everything we do (investment or general decision making), we must go through the 4 step process above. But sadly when it comes to investment, most ppl stop at No 1. If they perceive something to be risky, they just ignore and brush it aside before giving it due consideration through Steps 2,3 & 4 thus missing out on a potential investment opportunity.

The key reason behind this is many do not even know the meaning of the word 'risk'. Therefore they assume something is high risk when it could be a low/medium risk product. We need to also know the source of the risk. Quite often you will meet ppl who will assume something is high risk because they lack the knowledge in that particular scheme. But lack of knowledge is a personal limitation and not a product risk. So we need to deal with that ourselves.

ok,
i have started monitoring my daily expenses, cut down unnecessary spending,
currently i am building my emergency fund of 3-6months, still a bit more to go. insurance aldy have
and i am learning more financial knowledge and investment knowledge,

next step is to invest.
so basically i have to know my risk appetite then only i can select the investment vehicle that suit myself

Yes, we have some tools to estimate the risk value. Many people though that risk for a investment product is a consistently unchanged entirely, but our tools shows that the risk of all product is seasonly changed. Just need to capture the low risk season and do investment in that particular season, the reward shall be good enough with small risk.

Anyone calculate before how much need to save to retire?

while waiting for responses, you may try read this...
Retirement Planning: Calculate How Much You Need in 5 Simple Steps
https://www.imoney.my/articles/retirement-planning

or more in google
https://www.google.com/?gws_rd=ssl#q=how+mu...ire+in+malaysia

Thnx. Cos I calculate I will have roughly 1 mil when retire not sure if enough and what is equivalent to today value

From the imoney calculation it says I will have enough. Cool. I'm set for the future.

in the ends, it comes back to how much you needed to spend monthly during that period.

Anyone here has ever taken drastic steps to reduce expenses? I'm thinking of switching from car to cheap second hand kapcai to go to work. I'll still keep the car for long distance driving (e.g. balik kampung, vacation). I've done the research, and this seems like the only way to reduce my cost to go to work. There's no public transport near my place.

Cost-wise, it will reduce my fuel expense by a lot (though I will lose money in the short run to buy the bike and pay for motorbike license), if I can find a bike with 2-3 l/100 km fuel consumption. My car has an average fuel consumption of 9.5 l/100 km. I'm expecting a 50% or more reduction in petrol, and not to mention I don't need to pay for toll anymore.

I'm planning to dump the money I save by doing this into my emergency fund or/and unit trust.

Anything I'm missing, other than it's a bit more dangerous than driving, and I will be more susceptible to weather conditions (especially rain)?

This post has been edited by imnotabot: Jan 14 2017, 01:45 PM

instead of figuring how to cut cost.
spend more time on how to increase earning.