Back in 2000, 2k may be worth more than the 2k in 2018. But still.... not that much of a difference. Can still make it if you really put your mind and effort into it.

Alhamdullilah that first 200k loan was left in there to compound and now 18 years later I've upgraded to 600k ASB loan (400k ASBf (it was possible then) & 200k ASB2f) and earning dividends on almost 1M thanks to the power of OPM. All this from pure ASB growth and strategies. It is possible thru systematic execution of the strategies and techniques prescribed by this forum and another forum

Question:
In which year is the best to cancel the ASB loan (to maximize ROI)?
According to my calculation its the 2nd year with ROI 16% p.a.

Loan: 200k (No insurance)
Rate: 5.2%
Monthly: RM1,100
Total cost 2yrs: RM26,400
Total Dividend 2yrs: RM28,900 (assuming 7% dividend and dividend remain in account)
Principal refunded after 2 yrs: RM5,843.27

Profit after 2 yrs: RM8,423.27
ROI: RM8,423.27 / 26,400 / 2yrs
ROI%: 16% p.a

is this correct?

Back then, did you do the "rolling back" method?

And how about now, doing it?

Rolling back method? You mean rolling the dividend to pay for the installments for the following year?

This post has been edited by buggie: Jan 30 2018, 08:28 PM

Ya bro buggie i also want to know can u share it with us. What is your method use with asbf. Different person will use different method suit with the capability and objectives.

Just want to share new info

Maybank and cimb already increase the new rate from 4.8% to 5.05%

Ambank from 4.75% to 5%

Bsn still didnt get any news yet but im certain they also will increase the BR.

The new rate will effect to all either existing or new asb customer.

However to existing asb customer if after follow the new rate the increment is not above than RM50 then no changes to the installments.

But for the new customer will follow to the new rate which is 5.05% include the installment.

The spread will not change until the end of loan. In asbf loan there is a spread include with the BR.

The spread at cimb is 0.9% + 4.15% (BR).

For example normal rate at cimb is 3.9% + 1.3% = 5.2%
After the increment of 0.25% at the BR 3.9% will change to 4.15% which the total of the new rate include the spread will be 5.45%.

Thats mean 200k installment at 5.2% (30 years) = 1098.22 after the new rate will turn to 1129.31 (different RM31.09) - current asb customer the installment will not increase

While 200k installment at 4.8% (30 years) = 1049.33 after the new rate will turn to 1076.76 (different
RM27.43) - current asb customer the installment will not increase


Ok thats all i want to share for today. Hope u guys will get something from this reading.

-haziq-

This post has been edited by haziqnet: Jan 31 2018, 10:00 AM

oh current customers will not face the increase?

Yep instalment will remain the same if difference between old and new instalment is less than RM50.

oh good to know.

thanks

Long story short, I left the dividend in there all these years and never touched it.
Took my first 200k loan when i was 24.
After 10 years it grew to 400k (200k cash from dividend)
Then took another loan and transferred the 200k cash to ASW and ASD since no ASB 2 back then. So- 400k ASB sijil + 200k cash in ASD/ASW equals 600k
Transferred to 200k to ASB2 when the fund was created
After 7 years compounding 600k, got another 200k cash. = 400k sijil + 400k cash
ASB2 loan was introduced last year so I took it. Transferred the 200k cash in ASB2 to ASD again
So now is 600k sijil + 4++k cash. Took out almost 100k to renovate my new house so now left 950k


Some facts:
- The figures above are rough approximates.
- Everything here is pure organic growth and injections by way of asbf/asb2. None of my own cash was injected.
- My limit now for asb is essentially 600k now. I can remove say 50k for emergency and put it back later
- 8 years ago, it was possible to take loan up to 400k.they don't allow that now. So you're strategies differ slightly now. Only slightly....
- The years is approximate, I can't remember exactly but it was around year 2000 I think when I just started working.
- I am an average Joe salary earner punching the clock 9-5 with a public listed company. Started out at the end of 1999 after the 1998 economic crash. My starting salary was only 1600. I'm still with the same company albeit in a very much more comfortable post now.
- The loan installment was 1200 at that time so I only had 400 to spend a month. But I had an understanding gf back then who started work with gomen much earlier than me and pretty much supported me. She is now my wife of 15 years. I repaid her generosity by supporting her when she pursued her PhD.
- It says 4 funds here, namely ASB, ASB2, ASD & ASW2020. throughout the years, I transfered the funds around. But I don't have any in ASW anymore.
- I employed the terminate and reapply method. Everytime I terminated, I earned back 9-10k surrender value of which I spent as a reward to myself for being disciplined enough to continously pay monthly instalments. Down-payment on my first car - a kancil. Paid for my wedding. Even Stupidly bought a gaming pc costing 10k once which is now practically a door-stopper cum flower pot.

My target is to earn 80k in dividends yearly to support me when i retire. When I die, my son can inherit the Cash.
My last dividend was 41k plus ASB2 coming in march estimated to be 15k and ASD in June estimated to be 6k. So 41 + 15 + 6 = 62k

I'm now 42 so insyaallah I can reach 80k soon since I'm still compounding. That's additional 120k into the pool every 2 years and still going.

Remember the power of OPM. I pay 32k in installments but earn 62k for a nett of 30k. Actually more than that because the 32k a year i pay I will get back in ammortized value (the principal) when surrender.

I don't terminate anymore since once I terminate i cannot apply full 400k loan anymore. Also because my age is 42 so I can't get max tenure anymore thus my monthly repayments will be higher. But I did this religiously when I was younger to treat myself when i get the principal back. sort of a incentive to keep going with this.

This post has been edited by buggie: Jan 31 2018, 12:44 PM


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Tq for the sharing bro buggie. I can see u displined yourself from early as 24 years by making full asb loan of 200k. You sacrifice your desire to save money and once u have it then u spend it for what u want. I can see u learn from scratch and stick with your objective till the end. You understand the power of opm and use it fully to maximize your return in short of time. Its already 20 years and now your compounding + principal value from previous termination already can give u more than 40k per year.

This is what we call delay grafitication. We sacrifise first and enjoy later. Hope with your sharing here bro buggie it will inspire the other.

I also have the same objective as u where i want to have 800k of money in my asb acc before age of 50. With 800k of money save in asb i could get about 56,000/year (assume div. 7% per year)

Im using asbf to decrease the time and pay less to reach my objective. Inshaallah i will stick with my plan till the end.

Tq again bro buggie. I really love how u explain it. Simple and easy to understand.

Thanks for the info. I really appreciate jt

Thank you for sharing your invaluable life story. Really appreciate it bro

thanks for the info bro

respect u bro
u can resist all the temptations and keep servicing the loan without touching the dividends
not many can do that

Theoretically, the highest ROI is when you terminate once you got the first dividend. But it is highly not advisable since practically, it takes time to terminate and to re-apply so you might have trouble with the application (because of the ASB quota) or missed out dividend for few months.

Wau..you guys so pro..how come can earn when you surrender the loan?

Wow, I had a goosebump while reading your post.

Your real-life sharing is very inspiring espescially to a Gen Y like myself since most example are usually theoretical.

It really amaze me when I first found out about ASBF and make me learn more about the calculation and tricks behind it. Certainly, it is a no-brainer way for investments/savings.

It also what makes me become an ASBF consultant because I want to help others too. Till now, I manage to influence most of my friends who mostly just started working to apply for ASBF.

Really appreciate your posting sir!

Hate to be the bearer of gloomy news. I just think it's only fair, being a realist to highlight the other side of things to future folks...not to be swayed so much and jump in blindly. What buggie has accomplished with the system is great and all...It's always nice to hear one take advantage of a system. Alas, it's in the past and as with all investments.. One must look towards the future to plan accordingly and not live on mere hype or belief system from the past. Up until recently, simply to get some folks to sign up (ala commission, goodwill, etc..), people were being told it's okay to roll their dividends and use it to pay back the loan..In the end, banks never lose. Sure, you'll still get something than nothing in the end. But do not expect similar results. Especially as:
*The ringgit was much stronger back then.
*Cost of living was significantly lower.
*ASB dividends were almost double what they are today and dropping. Last year's returns, they had to be creative with numbers to appear good. Read into that what you may.
*400K limit vs 200K today. Sure you can workaround this by using family members. Be careful as you are basically entrusting your money to someone else.
*Toss in the recent hike in loan interest rates cuz as the economists say "the economy is booming".

ASB Dividends History


ASB2 Dividends History


ASW 2020 Dividends History


Summary: His technique worked for then.. Right time, right moves.. Do NOT assume such will work for this time. Keep your eyes and ears open for other opportunities and as he said.. Be disciplined, move cash around and let it grow. Finally, don't kiasu until you forget to live. You are only young once and when older, you do not want to feel like you missed out on key experiences cuz you were being to calculative. We remain humans with physical limitations..

There should always be a realist. Keeps things real yeah?

The route I took is real....and more importantly, still relevant. Thanks voncrane for putting up the table of historical dividends. First thing everyone should do is ignore the total dividends column because the 'bonus' dividends are insignificant if you know how they calculate it. Learn how to look past the window dressing. So just look at the dividends column. You would see that in 2001 and 2017 is the same dividend... 7%. Yeah sure it went up and down thru the years but no drastic changes there. So... What I did is still applicable and relevant in this era... About the 400k limit? Like I said... Just adjust slightly. In fact the landscape is better now than during my time. For 10 years I was limited by the 200k limit. Nowadays you guys have 400k if you count ASB2. If I had ASB2 in my days, I'd be 2M up now instead of 1M only. So consider yourselves the younger generation luckier than me. I'm so envious. You guys get to be 400k up instantly. I had to wait 10 years... Sigh... Plus, the banks interest was higher then. We were looking at upwards of 6% then. Not like 4-5% these days

And yeah voncrane is right also to say that don't kiasu and should enjoy when young. By all means... Everyone should enjoy life. But just keep one eye on your old age as everyone will eventually get there and your power to earn income diminishes significantly. So find a balance. Like I said in earlier post... If you're a salary earner like me that wasn't born with a silver spoon, work smart and hard to move up the ladder... Soon asb payments are just a small chunk of your salary that you also tak rasa. The rest of your income you go and do what you wanna do la. But if you're a rich kid who is waiting for your dad's inheritance, disregard all these posts as your strategy should be different.. Lol

What I have laid out and shared here is only a small part of my entire life... Lol... The ASB part as this is the ASB loan forum. There are actually better ways to earn more money. Some more risky, others require a high capital. Nothing ventured nothing gained. But that's for a different discussion thread.

Lastly... Try not to be a pessimist. Not a good way to live life. Things may look bad now but equally, things can also get better in the future. Who knows next general election BN kalah (seriously doubt this lol) and ASB naik to 10%? Who knows la kan? All we can do is be ready when that situation happens. Voncrane is right in that different strokes for different folks. Is all about opening doors when opportunity knocks.

This post has been edited by buggie: Jan 31 2018, 06:41 PM

Thanks for the heads up. A wise advice indeed.

As a typical Gen Y, I may simply blame government for the "bad timing" where I can no longer enjoy the good old dividend rate and also just simply buy a any house low and sell high after few years like what Gen X did.

However complaining will get me nowhere, so action is more realistic. Of course, I have to adjust my expectations and something is still better than nothing.

The perk of being a Gen Y is that there are easier accessibility to everything. So we have to be smart and look for more options to diverse our investments.

With all that said, the attitude and awareness to start saving from young will always stay true.