i see ... thanks.

4x50k

Does there a plan to cancel 1 by 1 if something go wrong? Just curious

Hmm, do you mean 4 separate 50K loans under the same person?

Yes can. If u have 50k x 4 asbf and if suddenly u have problem to commit all the loan than terminate one or more.

This post has been edited by haziqnet: Mar 13 2018, 07:57 PM

Thats normal. If the different after the rate increment is not more than 50 than ur installment will remain. However there is a catch ur loan tenure will be extend and ur principal value will be less a bit.

For example your loan tenure balance is 20 years. After the increment of BR, ur installment remain but your loan tenure will be extend maybe 2-3 years more.

Really this much of payments still for a 0.25% increase... Any proper formula one can use to be more precise?

Install financial calculator and look for tvm calculator. Insert the details and u can see how much the tenure extend. Dun worry. It wont effect too much of your total return. If u dun want for the loan tenure to extend than go to the bank and tell them u want to pay with new installment.

This post has been edited by haziqnet: Mar 13 2018, 07:56 PM

Yeah, I originally thought wanted to be safe that’s why I took 50 x 4, if I can’t commit then can cancel 1 or 2 loans and keep the rest. After 2 years got used to paying the commitment, so now I took 1 loan only lo.

You can do 10k x 20 also.

After house loan full throttle then i reevaluate myself back.

Others commitment like medical card etc also rise.

Paycheck hopefully on that way

Noted..

Hi guys, I have an ASB loan worth 202,177 (199000 for ASB and 3177 for takaful) over 30 years. Monthly repayment is 1060.75. Interest rate was 4.8% (now 5.05% from my CIMB click). I added 1k to make it 200k in my ASB account.

I'm trying to work out if it's worth it if I pay the loan over 30 years compared to saving on my own without touching the money for 30 years.

Basically I got:

Final ASB account balance = RM 200,000*(1.07^29) = RM RM 1,422,851.41
Total monthly payment = RM 1,060.75*12*30 = RM 381,870.00
Loan nett gain = RM RM 1,422,851.41 - RM 381,870.00 = RM1,040,981.41

Now, if I save on my own for 30 years, I got RM1,202,391.35.

Basically I calculated like this:

First year: RM1,060.75*12 = RM12,729.00
Second year: RM12,729.00*1.07 + RM12,729.00 = RM26,349.03
Third year: RM26,349.03*1.07 + RM12,729.00 = RM40,922.46
.
.
.
30th year: RM1,111,833.97 + RM12,729.00 = RM1,202,391.35

With this calculation, it seems like I'm going to lose around 160k by taking the loan instead of saving on my own:

Loan nett gain - Saving gain = RM1,040,981.41 - RM1,202,391.35 = -RM161,409.94

Is something wrong with my calculation, or am I using the wrong strategy?

By saving on your own, ie depositing RM1060.75 every month, dividend is calculated monthly tho against the lowest balance in account as opposed to ASB loan whereby dividend is always calculated monthly against 200k (not taking into account future dividend & bonus) except for the first month of disbursement since lowest balance in that particular month is not 200k.

So I don't think you should calculate the dividend from own saving based on one lump sum amount every year since it's calculated monthly

This post has been edited by Ronald K.: Mar 14 2018, 11:11 PM

You’re missing one very important point, ASB has a limit of 200k deposit, and any further than that, your money in ASB can only increase by dividend compounding.

The main point of ASB loan is to reach that deposit limit at the first year itself, as this gives you two main advantage over own savings - a) higher base for dividend compounding from the start, and b) MUCH MUCH faster way to increase your deposit limit (as deposit limit is only increased by dividend after your ASB has reached 200k) which might not give you benefit in terms of monetary benefit, but it gives you a great opportunity to invest in the future if you have extra money (sold a house or something).

In essence, you can not keep on depositing 12k++ each year for 30 years as that would mean you’re depositing around 360k++.

Your deposit limit will only increase based on any dividend growth after you’ve hit the 200k limit, so you can deposit until the 16th year or so, and then your growth is only limited by the dividend that you earn. That’s why your calculation is wrong.

Put in the scenario whereby you can not deposit any further once you’ve hit 200k on your ASB and then see how much balance you’ll get at the end of 30 years and it will be a whole different story.

Of course you can always open ASB 2 and then put in another 200k there, but again, it’s limited to 200k only, and the units are limited unlike ASB.

A better comparison should be ASB loan vs TH own savings, as Tabung haji has no limit on deposit, but of course lower dividend and bonus too.

This post has been edited by xeda: Mar 15 2018, 01:54 AM

Thank you so much for pointing that out! I totally forgot about the limit, lol. Now it makes much more sense, the difference between final nett gain from the loan and the saving is over 450k.

Just curious, ASB2 is limited to 200k only? but the limit is increased with dividend compounding as well like ASB aite?

Yes, but ASB 2 is also limited in the total number of units that PNB can issue to public, there’s only 1 billion units available for ASB 2, unlike ASB 1, there’s no limit to the unit that PNB can offer to the public.

This post has been edited by xeda: Mar 15 2018, 09:25 AM

wow new discovery i learn today, thanks bro for this info!

If you’re doing calculations, I would suggest doing it like this -:

a) ASB own savings until 200k limit reached by 12k deposit/year

AND

b) TH/ASB 2 own savings of 12k deposit/year until 30 years after you’ve hit the limit on ASB

That way, you’ll get a better comparison since you would have saved/paid 12k per year for 30 years in both using ASB loan or saving yourself.

Thanks for the idea! I did the calculation, and with ASB Saving+TH, it's still better with ASB loan. But with ASB Saving + ASB2 Saving, the table is turned. Perhaps the only way to overcome this is by taking both ASB and ASB2 loan.

Yeah, I did the whole calculation myself 2 years ago and using ASB loan is better.

The only problem that you’ll have now is that I think all the 10b unit for ASB 2 is fully taken up - I don’t know if banks can offer ASB 2 loan anymore - maybe some banks still have quotas, as I tried to deposit RM 500 into my ASB 2 and it was rejected due to insufficient fund available.