Malaysia's Weekly Personal Finance Summary - Feb 11 2019

Intro

This summary is by far the longest one yet. Take your time going through it as there are some really great content.

Also, I will be off the grid for about 2 weeks which means that there will be no new summaries during that time.

Question of the week

Do you have a standalone medical card or an investment linked card?

Let us know in the Facebook group

From More Money Malaysia

You already know that I'm a huge fan of BigPay. However, there are other ewallets here in Malaysia that you can take advantage of. Here's a blog post about some of the more well known ones.

We've released another video this week! This one introduces you to the basics of standalone medical cards. You can find it on our Youtube channel and on on Facebook Page!

How can we have made this more insightful?

Or is there a personal insurance related question you'd like advice on? Leave a message here!

Money in Daily Life

Strategies for Translating Long Term Financial Goals into Immediate Actions and Habits

having good long term goals that connect to immediate actions and habits is just a good all-around financial strategy, and it also happens to work well for almost any significant life change you want to make.

This blog piece does a great job elaborating on the strategies that the writer has used get him to where he is today. This will just be an outline of the ideas he's provided:

• Your first step is just to figure out your big financial goal
• What can I do this year to make that big vision a little closer to reality?
• Break your annual goal down into quarterly goals, then those into monthly goals, then those into weekly goals, then those into daily goals.
• Reflect on your daily / weekly / monthly goals each day, week, month to see if you are still on track

This is definitely a highly suggested read if you're trying to break down your long term to shorter term goals.

When To Do a Financial Review (And What to Look For)

How do you know if it's time to do a full financial review-and what should you look for when you do?

It is possible to do your own financial review and planning. This blog gives you a good starting point. Here are some of the main things to consider:

• When you get a raise: how much more can you put towards retirement? How can your budget now change with the new income?
• When you buy a house: how does this change your budget? Do you have the right insurance?
• When you get married: do you and your partner have similar financial goals? Will you use a combined account or will you keep your money separate?
• When you have a baby: do you have the ability to take time off to take care of the baby? Will you get a nanny? How will you save for their education? Will they need insurance?

Of course, if you would like to dig deeper in this or want someone to help guide you, consider working with a financial planner.

8 Ways To Make Your Angpow Money Work For You

• Deposit the money into your savings or fixed deposit account.
• Start or expand your investment portfolio.
• Re-Angpow.
• Buy a Multicooker.
• Get the Unlimited Monthly Transport Pass.
• Invest in yourself.
• Get insured.
• Pay off debt.

After wrapping up Chinese New Year with my extended family, I was actually wondering what to do with that extra money. Sure, I could use it to go to New Zealand, but I have already promised myself to make New Zealand work at under RM8000 and that I would only use money made from work to make it happen.

That said, I'm glad to see investing in yourself on this list as that's the main way I believe people can make more money.

18 Budgeting Tips to Make Money Management Easy

Budgeting is an essential part of a healthy financial life. It allows you to create a spending plan for your money to ensure you always have enough for the things that are truly important to you.

The 18 tips are:

1. Establish Needs Versus Wants
2. Keep Bills and Receipts Organized
3. Use Separate Accounts
4. Prioritize Debt Repayment
5. Divide Food into Two Categories
6. Don't Forget to Factor in Fun
7. Save First, Then Spend
8. Observe a No-Spend Day
9. Use the Right Tools
10. Start Contributing to Retirement Now saving for retirement is bad advice
11. Split Your Direct Deposit
12. Plan For Large Purchases
13. Outline Specific, Realistic Goals
14. Plan Ahead For Expensive Times of the Year
15. Account For Every Dolla
16. Expect the Unexpected
17. Include a Contingency Category
18. Adjust Your Budget Monthly

Protection _or Overkill? Five Insurance Policies You May Not Need

The need for some types of coverage is obvious. People with dependents who rely on their income recognize the need for life insurance. The prohibitive cost of medicine makes health insurance a must. However, there are other policies whose benefits are questionable.

• Mortgage Protection Life Insurance
  Instead you can get a standalone insurance plan
• Comprehensive and Collision Auto Insurance
• Life Insurance for Children
  A very debatable situation. By getting insurance when they're young, they're guaranteed coverage throughout their life. However, one could argue that they would be perfectly fine throughout the first 2 decades of their life which then means they won't need insurance until their 20s (when they have loan and income obligations).
• Rental Car Insurance
  Don't get it from the car agency. Instead see if your credit card already offers rental car insurance or if your travel insurance offers it
• Accidental Death and Dismemberment Insurance

Which One Should I Buy First? A Car or A House?
There's a way to have both and this blog gives you a quick overview of how to make it happen. Hint: buy the house first, rent part of it out and use that additional income to buy your car.

Of course, the blogger breaks down the concept in depth so you have see how the math works out.

Six Personal Loan Myths Dispelled

Many people think it's totally normal to run up balances on credit cards, yet they balk at the prospect of taking out a personal loan.

Here are the myths that this blog dispells:

• Myth #1: Interest rates on personal loans are high.
• Myth #2: You need to visit a brick-and-mortar bank.
• Myth #3: A personal loan will hurt your credit score.
• Myth #4: Personal loans are hard to apply for.
• Myth #5: You need excellent credit to qualify.
• Myth #6: Personal loans have a lot of fees.

Although I would not suggest personal loans for most situations, if you do have a lot of credit card debt, a personal loan would be a good way to consolidate the debt and (most likely) get a lower interest rate. But this only works if you do not continue spending on your credit card.

12 Strategies for Keeping Lifestyle Inflation in Check

Lifestyle inflation simply means an increase in one's spending as a result of an increase in one's income.

This is not necessarily a problem if the way you spend your money doesn't drain all the additional income that you have just made. In order to make sure that doesn't happen, this blog suggests the following:

• Strategy #1 - Clearly Define Your Life Goals and Your Idea of Success in Life
• Strategy #2 - Set Short-Term and Medium-Term Financial Goals in Line with Your Lifetime Goals
• Strategy #3 - Automatically Transfer Your Raise Before You Can Touch It
• Strategy #4 - Avoid Debt
• Strategy #5 - Make Debt Payoff a Top Priority
• Strategy #6 - Don't Repeat Splurges with Any Frequency
• Strategy #7 - Create (and Stick With) a Splurge Budget
• Strategy #8 - Kill the "Deserve" Question
• Strategy #9 - Carefully Research All Significant Purchases
• Strategy #10 - Bump Up Your Retirement Contributions
• Strategy #11 - Don't "Inflate" Your Friendships
• Strategy #12 - Find and Maintain a Repertoire of Free and Low Cost Things You Deeply Enjoy

Want To Have Your Money Accelerate Your Goals?

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Grow Your Wealth

27 Days Of Side Hustle: Brainstorming Your Home Business Ideas
Ever thought about doing a side hustle for some extra money? This blog gives you some ideas as to how to start thinking of your options.

I really believe in having a passion project because it gives you a chance to make money while doing something you love. However, if you're only going to do it because you can make money from it, I would suggest dig deeper as life is too short to spend doing things that drain you.

[SPONSORED] I Asked Hard Questions to the CEO of Funding Societies Malaysia
Some questions being asked Suraya:

• Funding Societies Malaysia boasts low default rates. Last I checked, it's at 0.93%, which is ridiculously low for a high-risk investment. How?
• Say I'm a company and I want to borrow money via your platform. What would cause my application to be rejected?

There are some other questions, but none of them relate directly to understanding funding societies. In regards to whether you should sign up and invest in it; I'd be cautious and the next article would explain why.

Diversify investments in P2P lending, youths urged

Technology-driven peer-to-peer (P2P) lending is becoming a popular investment choice among young investors, but the anticipated slowdown in the economy this year also raises the risk of losing money.

Unless you know the business itself and can see how it stands to go through the tough times ahead, I too, would suggest that you start diversifying your investments. We've been in a strong positive market the last few years so a lot of these P2P companies are able to promote such great returns. However, once the music stops, it can get ugly.

How to Strengthen Your Investment Portfolio in a Volatile Market

2018 was a roller coaster for the stock market. If you're an investor, you were probably impacted more than once - for better or worse.

This blog suggests that you have around 20% of your investments in alternative investments (that is, not in stocks) so that when the stock market does drop, your other investment will stay strong. Some examples of alternative investments include real estate, P2P lending, bonds, or best yet, your own business

Newbie Investing Mistakes and How to Avoid Them

Here are some common newbie investor mistakes, and how you can avoid them:

• Not Being Clued in About Fees
• Not Having a Plan
• Buying Something Without Doing Your Research
• Trying to Pick the Next Hot Thing
• Selling at the First Sign of Loss
• Not Starting Soon Enough
• Focusing Too Much on Investment Vehicles

FYI

Cool Opportunities

BigPay - The Best Travel Credit Card for Malaysians?
If you ever travel out of Malaysia and use your credit card, then this is BIG (pun intended). AirAsia has released BigPay, a prepaid mastercard that you can easily top up through the BigPay app and be able to use instantly.

But more importantly, BigPay charges you at the real exchange rate (which means they charge no fees). This is something you won't get if you were to go to your bank or some exchange counter.

In fact, I plan on only using this when I go to Toronto in December.

Anyway, if you don't have one yet, you can sign up for free and get RM10 free when you use referral code B7D3YNZPGO.

Talking to an Independent Financial Adviser
A big issue when you work with someone who calls themself a financial advisor is you do not know if they really have your best interest at heart. That's one of the main reasons why I never work with any (the other one is that most of them get trained to say what the company wants and thus, do not know of all the other cool opportunities out there).

However, I've been talking to an independent financial adviser the last few months and I do believe that not only is she knowledgeable, but also super open to sharing her knowledge.

If you're interested in talking to her, join our facebook group and ask your questions. She will definitely find time to pop by and answer them.