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Saturday, August 30, 2014

Our Investors Are Not Very Smart

I have read an interesting article regarding Malaysian investors are not very smart. There are other similar kind of surveys and articles that seem to show that Malaysians especially the Gen Y-ers are shying away from equities investment and prefer to hold cash than any other investment assets. Below are the whole article taken from Free Malaysia Today - Our Investors Are Not Very Smart, by Scott Ng.

Only 2% of Malaysian investors are able to answer survey questions.

PETALING JAYA: Malaysian investors are not as smart as they think they are. A survey has painted a dismal picture, saying our investors lack financial literacy.

The survey found that out of all the Malaysian participants in the survey, only 2% were capable of answering the five questions posed to them in the survey. This is in comparison with Singapore’s 20% and an 11% overall for all participants.

The latest Manulife Investor Sentiment Index in Asia (Manulife ISI) is based on 3,500 interviews across seven Asian markets.

It was also found that despite their inability to answer the survey questions, Malaysian investors displayed overconfidence in their financial literacy, with one in five rating themselves as “highly literate” when surveyed.

The report found that Malaysian investors also seldom review their portfolios and invest less frequently than their peers in the Asian region. This could be due to the fact that only 8% of investors engaged the services of financial planners, whereas the Asian average is 25%.

It was also reported that Malaysian investors rarely make use of readily available knowledge online, preferring to refer to advice from their friends and family when making investments.

The survey said Malaysian investors are also very attached to cash.

Overall, the single biggest asset holding for Asian investors is cash, amounting to an average of 52% in Malaysia, the highest in the region.

Though the survey indicates Malaysian respondents are holding idle cash, nearly half of the respondents said they did not hold enough cash. Only two per cent said their cash holdings were too big.

Malaysian investors also feel that bank deposits are safer than other options. This is also cited by respondents in Japan and China.

More information from the survey:-
Link 1
Link 2

Wednesday, August 20, 2014

How to save for your home down payment?

Have you ever wonder if you could ever got yourself a place you could call your own...a place call home?

If you have this dream of owning a home and finding it difficult to believe you can achieve it, you're absolutely normal, given the current economy in our country. But like many, it's possible to save for your home downpayment.

Some of you may opt to withdraw from your Employees Provident Fund (EPF) account number 2 to fund your house downpayment, but EPF is your retirement savings and you should really consider the possibility of it not being enough. For example, a property selling at RM400,000 with 90% loan comes with a down payment of RM40,000 (10%) and an additional of about RM20,000 in fees and charges. This would approximately come up to an initial payment of RM60,000 in cash.

It may seem overwhelming to save up that much, but by drawing a strict and realistic savings plan for this purpose, you will be able to afford your first home in no time.


I think most people don't have problem creating a budget...the problem is they forgot the need to stick with it. Start by deducting a certain portion for savings, say 10% to 30%, depending on your own preference. 

A clear budget is important because it helps to identify where you spend the most, whether it's on food, leisure, entertainment, family, social etc.

With a clear direction, it's only easier to cut and change certain habit that is wasteful and expensive. You will also learn to plan your activities like going for a cinema, exclusive food or clothing to a certain limit to ensure you stick with the BUDGET.


I think this is important for everyone of us. Most people, like myself are too lazy to compare clothes with different shops because we are rushing. We don't look for afforable alternatvies, when they are plenty.

  • For example, I replace my gym membership to going for running and workout at my condo's gym. 
  • Occasionally, I would eat at home for dinner instead of going out for my meal. (it's also healthier)
  • Substitute drinking session at club or bar to mamak session or kopitiam session. You maintain your social life, but at different places. You may also invite your friends over for a drink at home, instead of drinking at places that serve expensive drinks.
  • I change my internet from TM's UniFi to TIME Broadband. TM's UniFi cheapest at RM149 for 5Mbps while TIME's cheapest at RM129 for 8Mbps.
  • Instead of driving to work (where you pay for petrol, toll and parking), why not consider taking the public transport? The LRT is good in the country and in Klang Valley, there are also a lot of buses at a frequency that is acceptable. Maybe you have to wait the extra 10 minutes, but sometimes you skip the jam and you save so much more....
You may not believe it but the little from all these do great wonders in the long run.


Once you start to compare and look for affordable alternatives, it's also time to take note of the tax deductible items. By making simple efforts to understand the tax relief and rebates when you file for your tax yearly, you can drastically reduce your taxable income and pay less taxes.


If you think your earnings are not sufficient at the moment, consider earning extra income from your hobby, skill, time and even junk.

  • If you are good at writing, why not make full use of that? Start a blog, get nuffnang, or you may even offer your services to local newspaper, magazines, or websites. Websites like offers some freelance role at this.
  • If you love art and painting, consider selling it online. Paintings and craft souvenirs could earn you some extra cash. Some of the ways to sell is is via Facebook, eBay,, etc.
  • If you are good in a particular subject or are good at studies, consider offering tutor. Tutoring school students is a great way to earn extra income. I did this when I was in my university.
There are a lot of ways to do just got to spend a bit of time and effort to think and understand how it works.


I think this is the most important part. If you are in your mid 20s or early 30s and still don't know about investment, perhaps it's time to learn some basic rules of it. If stock market seems like a high risk investment for you, there are others with lower risk such as high-yield fixed deposits, bonds, Amanah Saham or unit trusts. These investments will bear returns which can be reinvested to earn more returns on our investments.

Once you figured out how you can save and invest your savings to generate returns, you need to be motivated and disciplined to keep going until you achieve your goal.

Well, if you have just started, it will feel difficult. You might be demotivated to continue, looking at the difference of the targeted amount and your current standing, but keep it up. After all, Rome was not built in a day, my friend.