Why would you want to that?

If the repayment amount is roughly the same, i would suggest the 200k loan to take advantage of OPM.

Bottom line, end of the year you will get interest on 200k vs only 100k with the same repayment amount. You do the math.

Risk almost none as you can always surrender anytime

Just sharing my opinion. If I were you, i'd take the full 200k on loan even if you have the cash. Always maximize the loan as research has proven (cari gold) that you earn more from the loan because you are leveraging OPM.

That cash in hand can be put elsewhere to generate even more income. eg Tabung Haji or other PNB funds or even down payment for a house which will appreciate in capital.

Make your money work for you! I myself am already on 400k loan with ASB and contemplating another 200k for ASB 2 for a total of 600k loan if budget permits!

IMO

This post has been edited by buggie: Nov 18 2015, 11:51 AM

For Bumi, not necessarily Muslim

Hi. Sure bro... It's on a single IC

Everyone knows that max you can put in ASB is 200k. but as you earn dividend, the size will expand. So for eg if after the first year you have earned 15k dividend, your ASB size is now 215k! so if you were to withdraw 5k and leave 210k in there, you can still put back that 5k in even though you have 210k already there.

So for me, I took the max loan about 8 or 9 years back earning dividend which i never touched and let it compound. Dividend size grew to 200k essentially doubled. So I had 200k sijil and 200k cash. Took out the 200k cash and put into ASB2 and replaced it with another 200k sijil from MBB. Making it 400k loan in ASB

Hope this helps.

This post has been edited by buggie: Nov 18 2015, 12:33 PM

ooh... didn;t know it is not allowed anymore. Then I guess I was lucky. Myabe in future they will open up again.

Anyways, take the 200k first. Who knows in 8-9 years they allow then you are already in the position to take advantage of it.

Good on you bro... always happy when I see people taking advantage of the priviledge given. Let's all prosper together.

Your 2 children's ASB is filled up already? You said you transferred from your ASB2 into your children's ASB2... If still got room in ASB better put there first... if already full then.... RESPECT!

Great! Just remember that this ASB loan will count in your CCRIS. So just keep that in mind when you do your budgeting and future plans.

He probably managed to accumulate up to 300k only before PNB imposed the max 200k ruling. So he can only take an additional 100k loan because that was what his limit had expanded to at the time. He will still continue to grow the dividend portion and with it also expand the Max limit.... just that he can't take anymore loan because of the PNB ruling now.

This post has been edited by buggie: Nov 23 2015, 12:20 PM

Ah, Good thinking

200k, as Davez89 said is about 1,200.00 per month.

although the dividend can cover the loan amount, I would suggest you don't touch it and let it compound. In 10 years, you double your money.

If you do take it out to pay your monthly loan, at the end of 30 years, you will have a little over 200k. If you leave the dividend in there and let it compound @ 7%, you will have 1.5M in cold hard cash! that's 1.3M difference...

If you can afford the monthly, take the full amount 200k as early as possible.

You need to accumulate capital as quickly as possible and 200k loan is the quickest way to utilize Other People's Money (OPM) to accumulate which will ultimately work for you...

So if you start small you lose that little time you have... BIG opportunity cost lost. For now, you may think you have plenty of time, but in reality, you don't.

Yes you are right. I myself take 100k x 4 loans

although if you do take 200k at once and you get in trouble, you could just surrender it and reapply for 100k

No. Hehe... That's too easy. Think you misunderstood.

if you do that, meaning take the dividend to pay for the loan you will only have 200k at the end of 30 years because since you take out every year to pay, there is no money in there left to compound.

You have to pay 1200 every month for 30 years to have 1.5m. You cannot touch the dividend at all...

May sound a lot but if you do the calculation...

1200 × 12 = 14,400. End of 30 years you get 200,000 so you untung 185,600

1200 × 12 × 30years = 432,000. End of 30 years you get 1.5m so you untung 1M

200k untung vs 1M untung.... Hmmmm

This post has been edited by buggie: Nov 24 2015, 03:25 PM

Bro, Your budget will definitely allow... remember, your income will also grow thru the years so it's only gonna get easier. By the tenth year, 1,200 will be chump change to you.

Be it business or makan gaji, if your income is stagnant for the last 5 years, you might wanna rethink your career path

When I was a fresh grad, earning 2k per month, i could still make the 1,200 payments. Now 15 years later, no sweat already.

So beginning a bit susah la... ketat pinggang sikit. But stick it out and the rewards will come.

Bro, Your budget will definitely allow... remember, your income will also grow thru the years so it's only gonna get easier. By the tenth year, 1,200 will be chump change to you.

Be it business or makan gaji, if your income is stagnant for the last 5 years, you might wanna rethink your career path

When I was a fresh grad, earning 2k per month, i could still make the 1,200 payments. Now 15 years later, no sweat already.

So beginning a bit susah la... ketat pinggang sikit. But stick it out and the rewards will come.

What exitsortie explains here is totally valid. It all depends on your goal.

And your goals will be forever changing as you get married, have children, grow older, unwanted emergencies happening, health status, etc...

ASB loan is only 1 investment vehicle. There are also potentially higher returns investments albeit higher risks such as property or stock market or even your own business. And you have a finite amount of resources. So choose wisely.

For me, one of my goal is to reach 1m in liquid cash as soon as possible and ASB loan is just 1 way to get me there.

Having said that, adjust as your needs changes. If you find a good deal on a property and ASB DSR is getting in the way then by all means surrender it and get the property then revisit when you have the means again.

Yes. They usually surrender after 2 or 3 years and get back the amortized value of the insurance and installments paid. Then they retake the loan again for the full 30 years again.

The monthly repayments remain the same, dividends untouched and the loan extended They get a few thousand back to reinvest or top up the ASB if not full yet to reach the max faster

Basically like remortgaging .... Very technical stuff.... goes all the way down to the timing of these transactions so as to not lose even 1 month of pro rated dividend!

don't think the BLR would make much difference. For me the earlier you take the loan the better.

As for which bank, i've always been using MBB, but i heard CIMB is quite aggressive now trying to sell this product. Suggest you check them out as well. Things to look for is Monthly repayment (lower is better), Lock in period (Less/no lock-in is best) and Insurance

Hope this helps

to quote exitsortie,

"Save without loan 1150/month for 30 years: Capital = 414k, profit = 960k, Return = 232% over 30 years, CAGR = 4.07%(using year = 15 since payment is made every year up until the 30th year, not lumpsum at the start"

But at 1200pm, by the 14th - 15th year, you would have deposited 200k. So i'm not sure if you will be able to continue after you reach that point since 200k is the limit. Someone please correct me if i'm wrong



This post has been edited by buggie: Dec 7 2015, 01:23 PM

Basically, the 1200 monthly payment to the bank is made up 2 parts - principle and interest. Principle belongs to you and interest belongs to the bank.

Usually at the beginning a any loan, the interest portion is higher than the principle. and towards the end, principle is higher than interest. for example, your first monthly payment will be made up of 200 principle and 1000 interest (not actual figures.

So if you terminate the loan after 3 years, you will get back the principle portion of the monthly repayments for the last 3 years. This should come up to about 7k upwards i think. The interest portion bank keep la.

So some investors will surrender the loan every 3 years (or 2) and reapply immediately. They get 7k to use as they please or to reinvest in ASB2 depending on their financial goals.

The year end dividend is unaffected because the loan is re-taken. but your loan tenure will reset to 25 years/30 years.

If you're young, and monthly repayments are the same or lower then do it.

This post has been edited by buggie: Dec 9 2015, 01:21 PM

In light of recent developments, do it while you still can. Don't wait till January.