MONEY MASTER

Here is the thing that we encounter most often...."income not enough?" A lot of people have criticize the Gen-Y for not knowing how to appreciate the jobs that they have or the opportunities given....it is true to a certain extend but what Gen-Y is complaining have its' valid points...ask most of the Gen-Y and they will tell you that their current companies are no good, income not enough etc.   Well, let us do some simple calculations shall we? Here is a simple calculation.... The average rate for a rented apartment in the Klang Valley costs between RM800 – RM1000 per month depending on location. Car loan repayments are somewhere between RM600 to RM1000 a month, while monthly fuel expenditure is RM 250 – 300 a month; exlcuding tolls. Food tallies up to about RM800, if you eat out everyday three times a day, averaging at RM10 per meal. Add other costs like cigarettes, entertainment, internet and telephone bills and all of that rounds off to about RM3000 – RM3500...

Earning more, especially from linear income usually not sufficient for one to be financially independent. A very simple reason being, your linear income is finite and there is a limit on how much you can get from salary. Next, age will be the limitation for one, and before we know it, it is time for us to retire from the workforce - and this is also assuming one does not get retrench before reaching the retirement age. One of Warren Buffett's famous quote on earnings is "Never depend on single income. Make investment to create a second source". It's true that one should not depends on single income, by saying this does not mean that one should work very long hours or do the extra mile by working for different companies or having multiple part-time jobs. Like the famous investor say, make investment to create a second source. There are many types of investment; properties, stocks, funds or commodities. Different investment comes with different risk and return....

The first universal rule of personal financial management is to spend less than what you have earn, but that alone is not enough. It is good for one to be able to control his or her own temptations from the materialistic world. However, as we know that the inflation actually drives a lot of things to become more expensive, hence living within means will not be sufficient. The next universal rule of personal financial management is to earn more. This one is a little bit more tricky than spending less than what you have earn especially for the working class because the salary is limited to what companies can offer. Even if this rule is not easy to apply to our life, we should really plan and think of the ways to earn more. There are reasons why earning more is important, in fact, it is as important as the rule number one which is to spend less than what you earn. Companies which are focusing on cost control will doom to fail in the future because there is no growth in the compa...