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In today's fast-paced world, having a credit card isn't just a luxury; it's a necessity. These days, we find ourselves in a very diverse and dynamic credit card market, and there are numerous opportunities to make your credit card work for you. But how exactly can you leverage this financial tool to your advantage? Let's dive in! Maximising Your Credit Card in Malaysia: A Comprehensive Guide 1. Choose the Right Card Select a card that aligns with your spending habits and lifestyle. With various credit card options available in Malaysia, find one that offers benefits like cashback, reward points, or travel discounts that suit your needs. 2. Pay Your Bills on Time Never miss a payment date on your credit card. Set up automatic payments or reminders, if you need to. This is so that you not only enhance your credit score but also avoid late fees and interest charges that are as high as 15-18%! Did you know: According to the National Credit Counseling and Management Agency (AKPK), over 53,000 of Malaysian youths have high credit card debts of nearly RM1.9 billion in total. 3. Maximize Your Rewards Credit cards in Malaysia offer a myriad of reward programs. Utilize these rewards by understanding how they work and redeeming them strategically. Be it travel, petrol, dining, or (grocery) shopping, there's a reward for everyone. 4. Avoid Unnecessary Debt With the temptation of easy spending, it's essential to manage your credit card wisely. Stick to a budget, avoid carrying a balance or just pay in full every month if you can, and escape the trap of compounding interest. 5. Take Advantage of Promotions Many banks in the credit card market offer promotions like 0% interest periods, no-annual fees, sign-up offers or special discounts with partner vendors. Stay informed and take advantage of these offers when they align with your spending plans. 6. Monitor and Protect Keep an eye on your credit card statements for any unauthorized charges. Utilize the security features offered by your bank, such as SMS alerts or mobile app notifications, to stay on top of any suspicious activities. Additionally, you should enable two-factor authentication where possible. Making the Most of Our Of Your Credit Card in Malaysia Handling a credit card can seem daunting, especially when we’re rotten for choice in the current broad Malaysia credit card market. If you’re willing to take the time to understand and navigate its complexities, your credit card can be more than just a means to spend; it can become a valuable financial asset. Simply by choosing the right card, maximizing rewards, managing debt wisely, and staying informed about promotions and security, you can make your credit card work for you right here in Malaysia. Remember, the key to success when it comes to using your credit card is not spending frivolously but spending smartly. Always consult with a financial expert if you have any doubts or need personalized guidance. Happy spending! 🇲🇾 Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

The tantalizing scent of nasi lemak, the richness of rendang, and the zest of laksa – Malaysian cuisine is nothing short of a culinary odyssey. However, amidst the rising living costs, indulging in these gastronomic delights can feel like a pinch to the wallet. Fear not! Here’s a guide on how to cut your food budget without compromising on taste. 1. Embrace Local Markets (Pasar Malam/Pasar Pagi) Why: Local markets or pasar malam often provide fresher and cheaper produce compared to supermarkets. Tip: Visit during the final hours for potential discounts as vendors clear stock. Savings: Expect to save up to 30% compared to supermarket prices. 2. Opt for Tapau Over Dine-In Why: Avoiding service charges and government taxes, tapau (takeaway) proves more economical. Tip: Utilize your own containers for both savings and sustainability. Savings: About 10-15% off your total bill. 3. Savor Economy Rice (Nasi Campur/Chap Fan) Why: With a variety of dishes, nasi campur or chap fan stalls provide value for money. This is especially great if you're living alone as groceries are getting more expensive these days. Tip: Veggies and tofu are both nutritious and cost-friendly choices. Savings: Up to RM5-10 per meal. 4. Stay Active in Malaysian Food Social Media Groups Why: Groups like “Foodie Malaysia” spotlight current promotions and discounts. Tip: Enable notifications to grab those short-lived deals. Savings: Seasonal deals can offer 20-50% off. 5. Cook Using Local Ingredients Why: Whipping up meals with ingredients like tempeh or kangkung is light on the pocket. Tip: Challenge yourself with hawker-inspired dishes for that authentic taste. Savings: A home-cooked meal can save you RM10-20 per serving. 6. Bulk Buys Are Your Best Friend Why: Staples like rice or ikan bilis are cheaper in bulk. Tip: Store perishables properly to ensure longevity. Savings: About 15% off retail prices. 7. Capitalize on Food Delivery Discounts Why: GrabFood and FoodPanda frequently roll out promotions. Tip: Consider shared orders for added discounts. Savings: Periodic discounts can shave off 10-40% off your bill. 8. Loyalty Programs and Cards Why: Many eateries and cafes have loyalty cards offering every 10th meal or drink for free. Tip: Keep these cards in your wallet to ensure you don't miss stamping them. Savings: Effectively 10% savings on every 10 meals. 9. Off-Peak Dining Why: Some restaurants offer discounts during non-peak hours to attract customers. Tip: Opt for early dinners or late lunches. Savings: Discounts can range between 10-30%. 10. Grow Your Own Vegetables Why: Cultivating basic herbs or veggies ensures freshness and reduces costs. Tip: Start with easy-to-grow plants like mint or chilli. Savings: Up to RM15-30 monthly, depending on consumption. In A Nutshell While the Malaysian food scene remains an ever-alluring arena, being judicious about your choices ensures your palate and pocket both leave satisfied. With these tips, you'll be able to cut your food budget yet enjoy the yummy goodness of our local cuisine! Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Navigating the realm of personal finance can often feel like charting unknown waters. One of the most fundamental questions many individuals grapple with is: Should I save, invest, or do both with my money? In this article, let's explore the advantages and considerations associated with each approach to help you make an informed decision. Saving: The Traditional Safety Net The first lesson we learnt as a kid from our parents has always been to “save your money!” And that notion still rings true today - saving is an important aspect of personal finance. It provides liquidity, stability and is the most predictable asset you can own. Savings, especially when kept in accessible accounts, can be readily used for immediate expenses or emergencies. Other than that, funds saved in banks are usually insured up to a certain limit, providing security against loss. Unlike investments, savings usually provide a fixed return, albeit a small one. However, when you’re only saving your money in savings accounts, the interest rates often don't keep pace with inflation, which means the real value of your money might diminish over time. You are also missing out on opportunity cost as money that’s saved and not invested misses out on potentially higher returns from investments. Investing: The Path to Potential Growth Most of us start hearing talks about investing when we’re in college or when we start working. We’ll hear things like “make your money work for you” and although it’s cliche, it is possible to make your money work for you - and you should! By investing, you’re reaping in potential higher returns, taking advantage of compound growth as well as spreading your wealth across various assets other than cash. Investments, when chosen wisely, can offer returns significantly higher than traditional savings accounts. Then with your earnings, it can be reinvested, leading to compound growth and potentially accelerating wealth creation. Investing is also not as scary as it seems as there are diverse options to choose from including stocks and bonds to real estate and mutual funds. All you have to do is research and find an investment option that suits your risk appetite. With that being said, it’ll be ignorant to say that investing is easy. It comes with risks and the possibility of losing some or all of your invested amount. Investing also requires a certain level of knowledge, and while resources are abundant, it can still be daunting for beginners. Last but not least, some investments may not be as easily liquidated as savings, which can be a concern if funds are needed on short notice. A Balanced Approach: Save, Invest Or Both? For many people, a combination of saving and investing proves the most beneficial. I’m sure you’ve heard of the "50/30/20 rule" – allocate 50% of income to necessities, 30% to lifestyle choices, and 20% to savings. I want to challenge this rule and tweak it to include investments. I call it the “50/20/10/20 rule” - 50% necessities, 20% lifestyle, 10% savings, and 20% investments. Here's why I think every Malaysian should use the 50/20/10/20 rule and take a balanced approach to saving and investing: 1. Immediate Safety Net A savings buffer can provide peace of mind without touching investments. For instance, the "6-months rule," suggests saving an amount equivalent to six months of expenses for emergencies. This can ensure you don't have to liquidate investments in a rush and miss out on compounding growth. 2. Long-Term Growth Investing a portion of your money can ensure that you’re not only preserving but also growing your wealth. Fortunately in Malaysia, we have EPF. While it's primarily a savings tool, EPF invests portions of the pooled funds, making members like you and me indirect investors as well. 3. Flexibility A balanced approach offers flexibility. You can adjust the ratio of savings to investments based on life stages, goals, and financial needs. For example, a fresh graduate might focus more on saving, but as one climbs the career ladder, the balance can shift towards investments. Conclusion Whether to save, invest, or adopt a balanced approach depends on individual circumstances, financial goals, risk tolerance, and time horizons. For many, a mix of saving for short-term needs and investing for long-term growth is a strategy that offers both security and the potential for increased wealth. What we need to understand is that it isn't a matter of choosing one over the other but rather understanding their individual and complementary strengths. By harmonizing traditional wisdom with modern financial strategies, Malaysians can pave the way to holistic financial health. And as always, continuous learning is your best ally on the journey to financial well-being. Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

In Malaysia, oftentimes, property and stocks stand out as the two predominant forms of investments. Both present unique advantages, risks, and strategies, making the choice between the two not-so-black and white. In this article, we’ll dive into the world of property and stock investing to provide a clearer picture of their differences and hopefully, it’ll help you make better informed decisions. Property Investment in Malaysia Advantages of Property Investment: 1. Tangible Asset Similar to global markets, Malaysian real estate, especially in prime areas like Kuala Lumpur, Penang, and Johor Bahru provides you with a tangible, physical asset. This offers both utility like living in it or renting it out and security where you can touch and see the property. 2. Rental Yield Malaysia has become a hub for expatriates and international students, especially in places like Cyberjaya, Kuala Lumpur and Selangor. This provides you with the opportunity for rental income . This could either mean renting out the entire property or even individual rooms. 3. Tax Benefits The Malaysian government has introduced various tax benefits and deductions for homeowners renting out their property as well as first-time home buyers. In terms of rental tax deduction , you can get write-offs on: Assessment tax Quit rent Interest on home loan Fire insurance premium Expenses incurred on rent collection Expenses incurred on rent renewal Expenses on repairs and property maintenance On the other hand, according to FMT , if you’re a first-home buyer of residential properties, you are exempted from stamp duty on the sale and purchase agreement (SPA) and l oan agreement s for residential properties priced below RM500,000 . *Do note that the exemption applies to Malaysian citizens on any SPA completed between Jan 1, 2021 and Dec 31, 2025. 4. Leverage With real estate, you can buy a property with a fraction of the price down (through a mortgage) and benefit from the full appreciation of its value over time . The good thing is that financial institutions in Malaysia also often offer competitive mortgage rates , allowing you to leverage your investments with relatively low initial capital. Disadvantages of Property Investment: 1. Market Oversupply Certain segments of real estate in Malaysia, especially luxury condos in Kuala Lumpur, have seen an oversupply , which might affect rental yields and resale values. Additionally, the property market can also go through long periods of decline , leaving you with assets worth less than their buying price. 2. Maintenance Costs Owning property comes with ongoing expenses like taxes, maintenance, repairs, and insurance. This means you’ll need to ensure that you have extra funds to not only cover those expenses but any “emergency” costs that may arise. 3. Illiquidity Real estate is not as easily converted to cash compared to stocks. Selling a property can take weeks if not months. So, when you decide to invest in property, you’ll need to keep in mind that this is a long-term investment. Stock Investing in Malaysia Advantages of Stocks Investment: 1. Liquidity The appeal to stock investing is how “fast” you can profit from it. Stocks can be sold almost instantly during market hours, providing access to cash quickly . In that sense, stocks are pretty liquid assets. However, it’s worth noting that you’ll only want to do this if you have the knowledge and time to spare. 2. Dividends In Malaysia, there are many established companies, especially those in finance and utilities that regularly offer dividends, providing shareholders with a consistent income stream . 3. Diversification With stocks, diversifying your portfolio is simpler and a healthy practice to adopt when investing. You can invest in various sectors, industries, and regions with a smaller amount of money . 4. Growth Potential Historically, the stock market has shown significant growth over long periods. Disadvantages of Stocks Investment: 1. Market Volatility As with global markets, Malaysian stocks can be volatile , influenced by both domestic and international events. This could lead to potential short-term losses which is why understanding your financial goals, risk tolerance and investment horizon is important. 2. Requires Research Effective stock investing often requires regular monitoring, research, and understanding of the market dynamics. So, before investing, it’s best that you pick up on some knowledge then along the way, you can continue learning even more so that you’re able to make better investment decisions. 3. Emotional Factors The stock market's ups and downs can be emotionally taxing . And when there are emotions involved, it could potentially lead to making impulsive investment decisions . Maybe that’s why there are more and more robo-advisors popping up these days? Anyway, what you need to understand is that the market’s volatility is normal and more often than not, the market bounces back after a dip. So, it’s important to stay disciplined on your financial goals when you’re investing in the stock market. Property vs. Stock Investing in Malaysia: Which Is Better For You? 1. Initial Investment Property : In Malaysia, buying a property, especially in prime areas, requires significant initial capital . Stocks : In contrast, with just a few thousand or even hundreds of ringgits , one can start investing in a diverse portfolio of stocks. 2. Market Knowledge Property : Understanding property hotspots like Bangsar, Desa Park City, or emerging areas in Shah Alam can be crucial for real estate. Stocks : For stocks, staying updated with top-performing sectors , whether in the local or global stock can be equally critical. 3. Investment Period Property : Real estate in Malaysia, given the current oversupply in some segments, might require a longer-term perspective . Stocks : Depending on the strategy, can offer both short-term trading and long-term holding opportunities. My Personal Opinion on Property vs Stock Investing in Malaysia The decision between property vs stock investing in Malaysia hinges on individual preferences, financial goals, and market knowledge . For some, the allure of owning tangible property might be irresistible. Others might find the dynamic nature of the stock market more exciting and lucrative. Perhaps the ideal approach for you is a balanced portfolio , combining the stability and tangibility of property with the liquidity and growth potential of stocks . Personally, I do a bit of both. One of my income streams is through rent yield and I’m also a pretty active investor whether it’s in the local market, global market or cryptocurrency. This is because I believe in the importance of diversification . In fact, I always advocate that you should never put all your eggs in one basket! However, whichever side of the fence you're on, at the end of the day, due diligence, continuous education, and sometimes even seeking advice from financial experts, remain key to successful investing in the Malaysian context. Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Investing in Malaysia presents a wealth of opportunities, with a notably mature market in both conventional bonds and sukuk, which are Islamic bonds. Understanding the difference between the two and how to invest in them can be an essential step in diversifying your investment portfolio. Let's delve deeper into these two prominent investment avenues. Table of Contents What’s the difference between sukuk and bonds? How do bonds and sukuk work? What are the different types of bonds and sukuk available in Malaysia? What are the benefits of sukuk and bond investing? What should I consider before investing in bonds and sukuk? How to buy sukuk and bonds in Malaysia? Where to buy sukuk and bonds in Malaysia? What bonds and sukuk should I invest in? FAQ about bonds and sukuk What’s the difference between sukuk and bonds? Bonds Bonds are debt instruments issued by companies, governments, or other entities to raise capital. Investors who purchase bonds are essentially lending money to the issuer in return for regular interest payments and the return of the principal amount at maturity. Sukuk Sukuk, on the other hand, are Islamic financial certificates , similar to bonds, but comply with Islamic law, Shariah, which prohibits usury (interest). Sukuk represents an undivided share in the ownership of tangible assets relating to particular investment projects or special investment activity. How do bonds and sukuk work? Bonds Think of buying a bond like lending money to a friend. In this case, your friend is either the government or a company. When you lend them money (by buying a bond), they promise to pay you a bit extra (interest) as a thank-you gesture periodically. And just like a trusty friend, at the end of a set period, they give you back the original amount you lent them . For example, imagine you buy a bond from a company for RM1,000 with a 5% interest rate per year for 3 years. Every year, you will receive RM50 as interest, and at the end of the 3rd year, you'll get your RM1,000 back. So, in total, you would’ve made an extra RM150 from your investment (excluding the amount you lent). Sukuk Now, sukuk is a little different and is more like a business partnership , following the principles of Islamic finance. When you invest in sukuk, you are essentially buying a share in a business project or asset. Instead of getting regular interest payments (like in bonds), you get a share of the profits made by that project or asset, which can come from the rental income or the profit generated by the asset or project. For instance, imagine a group of people pool in money to buy a piece of land and develop a commercial building on it. As one of the investors, you will get a share of the rental income generated from the building, proportional to your investment. And if the building is sold, you get a portion of the proceeds as well. What are the different types of bonds and sukuk available in Malaysia? Bonds Government Bonds : Bonds issued by the Malaysian government. Corporate Bonds : Bonds issued by corporations to raise capital. Municipal Bonds : Bonds issued by local government entities or municipalities. Quasi-Government Bonds : Bonds issued by government-linked companies (GLCs) or government agencies. Sukuk Sovereign Sukuk : Sukuk issued by the Malaysian government and are Shariah-compliant equivalents of government bonds. Corporate Sukuk : Sukuk issued by corporate entities in accordance with Islamic principles. They might be linked to specific projects or assets. Asset-Backed Sukuk : Sukuk backed by tangible assets or projects, providing investors with a claim on the underlying assets. Project Sukuk : Sukuk specifically issued to fund a particular project, and the returns are often generated from the project’s revenues. Retail Sukuk : Sukuk specifically designed for retail investors What are the benefits of sukuk and bond investing? Benefits of Investing in Bonds Predictable Income Stream : Bonds provide regular interest payments, offering a predictable income stream. Capital Preservation : Being a debt instrument, bonds are generally seen as a safer investment, preserving the capital invested. Diversification : Bonds can be an excellent tool for diversification, especially when included in a portfolio dominated by more volatile assets like equities. Variety of Options : Investors have the option to choose from government bonds, municipal bonds, or corporate bonds, each carrying different risk profiles and interest rates. Benefits of Investing in Sukuk Ethical Investment : Since sukuk are compliant with Islamic Shariah principles, they represent an ethical investment avenue, avoiding sectors like alcohol, gambling, and usurious practices. Asset-Backed Nature : Sukuk securities are generally asset-backed, offering a tangible security that can sometimes provide a safety net in case of defaults. Diversification : Similar to bonds, sukuk can provide diversification in an investment portfolio, especially for investors looking for halal investment options. Stable Returns : Sukuk can offer stable returns, derived from the profits of the underlying assets or rental agreements, providing a predictable income stream. What should I consider before investing in bonds and sukuk? Considerations When Investing in Bonds Interest Rate Risk : Bonds are susceptible to interest rate fluctuations. When interest rates rise, bond prices tend to fall, and vice versa. Lower Potential Returns : Compared to stocks, bonds generally offer lower potential returns, especially in low-interest-rate environments. Credit Risk : Particularly in the case of corporate bonds, there is a risk that the issuer might default on their interest or principal payments. Inflation Ris k: The fixed interest payments from bonds can be eroded by inflation, particularly if the bonds have a low interest rate. Considerations When Investing in Sukuk Limited Liquidity : Compared to bonds, sukuk markets might be less liquid, sometimes making it challenging to sell them quickly at market prices. Complex Structure : Sukuk often involves a more complex structure compared to bonds, incorporating various contracts and agreements to ensure Shariah compliance. Potential Concentration Risk : Given the specific sectors and assets that sukuk invests in (to remain Shariah-compliant), there can be a concentration risk where investments are focused in particular sectors, making them more vulnerable to sector-specific downturns. Limited Availability : Depending on the region, the availability of sukuk might be limited, potentially restricting investment opportunities compared to the more widespread bond markets. How to buy sukuk and bonds in Malaysia? Bonds Choosing a Reliable Broker or Bank : Institutions like Maybank , CIMB , and Hong Leong Bank offer platforms to invest in bonds. Research : Consider researching various bond offerings in terms of their credit ratings, interest rates, and maturity periods. Investment : Invest through the chosen platform, maintaining a clear strategy regarding your investment horizon and risk tolerance. Sukuk Selecting an Islamic Financial Institution : Choose a financial institution offering sukuk investments, like Ambank or Maybank Islamic . Consultation : Consult with financial advisors to understand the nuances of sukuk investments better. Investment : Like bonds, decide your investment strategy based on risk tolerance and investment horizon and proceed to invest. Where to buy sukuk and bonds in Malaysia? Bursa Malaysia FSMOne Appointed banks and financial institutions What bonds and sukuk should I invest in? Well, we can’t recommend any bonds and sukuk for you to invest in (due to regulatory issues) but here’s a list of the more “famous” bonds and sukuk that investors generally go for based on their credit ratings, interest rates, maturity period and overall credibility. Examples Bonds Malaysian Government Securities (MGS) Malaysian Savings Bonds (MSB) Malaysia Treasury Bills Bank Negara Monetary Notes Petronas Bonds YTL Corporation Bonds CIMB Group Bonds Examples Sukuk Government Investment Issues (GII) Malaysia Islamic Treasury Bills Bank Negara Monetary Notes (Islamic) Khazanah Nasional Sukuk Alliance Islamic Bank Telekom Malaysia Malaysian Resources Corporation (MRCB) To find more information on the yield and performance of bonds and sukuk (locally and internationally), check out FSMOne . Frequently Asked Questions about Bonds and Sukuk What are the returns on bonds and sukuk? Returns vary depending on the economic conditions of the country and world but average returns for both are around 2%-6% . Are bonds and sukuk safe investments? Both are generally considered low-risk as returns/income are fixed. Additionally, they’re not as volatile as stock investing and if you’re still worried, you should know that most bonds and sukuk have a credit rating which can help you gauge the level of risk of those assets. Will I get taxed on my bond and sukuk investment returns in Malaysia? No, you will not get taxed on your investment returns for both bonds and sukuk. Conclusion on Bonds vs Sukuk Investing in Malaysia In the Malaysian investment landscape, both bonds and sukuk offer viable investment avenues. If we were to compare bonds vs sukuk in Malaysia, bonds, with their interest-based returns, cater to the general investment community, while sukuk, adhering to Shariah principles, cater to investors seeking ethical and Islamic investment options. Of course, before investing - whether in bonds and sukuk or any other investment, it's essential to research thoroughly and possibly consult with a financial advisor to understand the nuances of each investment type better. Remember, both investment types come with their set of risks and potential rewards, and understanding them fully can help in making informed investment decisions. Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Malaysia, with its booming cities like Kuala Lumpur, Penang, and Johor Bahru, offers a myriad of opportunities for property investors. And if managed well, rental property investments can indeed become a reliable source of passive income. So, here are seven tips tailored for you to ensure your property rental venture is successful. Location is Key in Rental Property In Malaysia, certain areas are always in higher demand. Places close to LRT and MRT stations, popular shopping districts like Bukit Bintang, and educational institutions such as the University of Malaya are examples. What you’ll want to look out for is the potential tenant base: students, working professionals, or families. For instance, properties in Cyberjaya are sought-after by tech professionals and students attending nearby universities. Whereas properties in Bangsar, attract both expatriates and locals due to its cafes, international schools, and connectivity. Understand the Local By-laws and Regulations Each state in Malaysia might have variations in their property laws. For example, Penang has regulations on property ownership for non-Penangites. It’s essential to understand local regulations, especially regarding rent control, tenants' rights, and maintenance responsibilities. Another example of this would be that in certain regions, the local councils might have specific requirements for homestays or short-term rentals (think Airbnb). Overlooking such regulations can lead to fines or even eviction of tenants. Setting the Right Rental Price Check comparable properties in platforms like PropertyGuru or Mudah.my. This is because, overpricing can lead to extended vacancies, but underpricing means you're leaving money on the table. Also, consider if the rent includes utilities, furniture, or maintenance fees. A formula you can follow to determine the right rental price is: Annual Rent = (Monthly Rent x 12) - (Vacancy Rate x Monthly Rent x 12) So, if you rent out a property for RM2000/month with a 10% annual vacancy rate, your net annual rent would be RM21,600. Draft a Comprehensive Lease Agreement This is crucial. Work with a lawyer familiar with Malaysian rental laws to draft a lease that covers everything from the rental amount, duration, maintenance responsibilities, to terms of lease termination. It’s also standard practice in Malaysia to ask for two months' rent as a deposit plus an additional half month’s rent as a utility deposit. Ensure Proper Maintenance A well-maintained property not only fetches a higher rent but also attracts responsible tenants. Given Malaysia's humid tropical climate, regular checks for mould, timely paint jobs, and ensuring functional air-conditioning units are essential. Vet Potential Tenants Just like you'd vet a potential employee, screening your tenants can save a lot of future hassle. Ask for references, preferably from previous landlords. Some landlords in areas like Desa Park City even have informal groups to share feedback on tenants. Consider Hiring a Property Management Company Especially if you own multiple properties or if you’re based overseas, companies like IQI Global or Bumbung can handle tenant-related issues, and maintenance, and even help in sourcing potential renters. So, for example, let’s say you own a property in Johor but live in KL. A pipe leakage issue could take days for you to address personally, leading to disgruntled tenants. A property management firm in Johor could handle it within hours. Conclusion Renting out property in Malaysia as a source of passive income is a lucrative venture. However, like any investment, it requires due diligence, market understanding, and regular oversight. With these seven tips in mind, you're on a solid path to making the most out of your Malaysian property investment. Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Are you looking to dip your toes into investment waters but are afraid of the risk of losing your hard-earned cash? You're not alone! Investing in the stock market can be intimidating, especially for beginners. Given the market's complexities and the fear of financial loss, it's no wonder that many struggle to take the first step. Paper trading is an invaluable tool to familiarise yourself with the stock market and test your investment skills without using your own real money. This simple guide will help you learn about paper trading, discover the benefits of paper trading, and learn how to get started. Let's dive in.  Summary: 1. What is paper trading? 2. Why is it called paper trading? 3. How does paper trading work? 4. Benefits and considerations of paper trading 5. How to start paper trading What is paper trading? Paper trading, or virtual trading, is a practice that enables investors to buy and sell “fake” stocks, bonds, or cryptocurrencies in a simulated environment without financial transactions. Think of it as an investment training ground where you can experience all the thrills of buying and selling without the risk of losing any real money. Whether you’re a budding investor or a seasoned investor, paper trading is an essential tool to learn trading skills before venturing into the real market. Why is it called ‘paper trading’? The term paper trading comes from the old-school practice of traders jotting down their trades on paper. Before online trading platforms existed, aspiring traders would practice their trading skills on paper to avoid risking losses on the live market. They would record hypothetical trades by hand to keep tabs on virtual portfolios, profits, or losses. Thanks to technology, paper trading can now be done digitally through electronic stock market simulators that mimic the look and feel of actual trading platforms. moomoo, for example, offers a free-to-use paper trading feature that makes it easy for investors to practice risk-free trading with realistic stock market data. How does paper trading work? The process of paper trading involves using a virtual or demo account provided by an investment platform. Users are given a set amount of virtual money to invest and can buy and sell assets just like in real trading. The only difference is that no actual money is at stake. This means you'll be granted virtual cash to make trades just like you would with real money. You can buy and sell stocks, track your portfolio's performance, and experiment with different strategies without risking a penny. Benefits of Paper Trading: Now that you understand what paper trading is, let's get into why you should try paper trading. 1. Risk-free and Stress-free Learning One of the biggest advantages of paper trading is that it is risk-free and stress-free. Since no real money is involved, you can make trades based solely on your analysis and risk appetite. You'll be able to explore various investment moves and take higher risks than you would with real capital. 2. Builds Your Confidence As cliche as it may sound, practice makes perfect. When you practice paper trading, you can test strategies, monitor your performance, and tweak your strategy. By doing so, you'll feel confident in making informed decisions when you transition into the real market. 3. Gain Better Understanding Practicing paper trading helps deepen your understanding of how the market works. You’ll gain insight into how factors like politics and economics influence market prices, which will help you build a solid foundation of market knowledge. 4. Develop Emotional Discipline Successful trading requires discipline and patience. Paper trading provides a platform to practice these crucial skills without the pressure of real money on the line. You can learn to control your emotions, stick to your trading plan, and avoid impulsive decisions. Considerations When Paper Trading: 1. Limited Market Simulation While paper trading gives you valuable trading practice, it may not accurately mimic the complexities of real-life market conditions that impact live trading, such as slippage and order execution delays. 2. Take It Seriously While there's no real cash involved, it's still important to treat paper trading seriously and make decisions as if you were using real money. This will enable you to test your investment ideas, adjust your strategies, refine your trading skills, and develop the emotional discipline needed for successful live trading. 3. The Overconfidence Trap You may run the risk of falling into the overconfidence trap after a few successful simulated trades. The false sense of security may result in a harsh lesson when transitioning into the real market. Keep in mind that live trading comes with unpredictable risks, and the outcomes of simulated trades may not mirror similar results in live trades. 4. Returns are Not Real As paper trading is virtual, the obvious downside of paper trading is that although you can't lose any money, you'll also not be able to cash out any of your returns. How to Get Started with Paper Trading The moomoo app features a free-to-use paper trade simulator for investors to trade in realistic market conditions, risk-free. Follow these simple steps to get started on moomoo: Step 1. Open an Account You can start by opening an account here. Once you’ve downloaded the mobile app, log in with your verified credentials. moomoo gives you the convenience of logging in with your social media credentials or Google account. Step 2: Access the Paper Trading Feature After you log into the moomoo app, access the Papertrade feature through the Discover tab and select Papertrade to activate your paper trading account. Step 3: Activate Your Paper Trading Account Upon activating your paper trading account, you'll be credited with $1 million in virtual cash to start trading in the US and global stock markets. How to Start Paper Trading 1. Decide on a Trading Strategy The first thing you need to do is choose a trading strategy. Planning a trading strategy depends on your personality, level of discipline, and risk tolerance. This plan will help guide your decisions about when to buy or sell. 2. Choose Stocks to Trade Next, decide which stocks to trade. Look for stocks that have the potential for big profits. It's essential to research and understand how stocks perform. 3. Place Your Order On the moomoo app, select your asset, select your order type, price, quantity, and amount, and tap on the buy button to place your order. 4. Learn and Improve Analyse your trades to see what went well and what didn't. Based on your findings, make changes to improve your strategy. Conclusion Whether you're an absolute novice or a seasoned investor looking to fine-tune your investment strategies, paper trading is a great way to gain practical trading experience and build your confidence in trading. Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

With all the talk about investments - bitcoin value hitting a record high and the market flipping from EVs to AIs, how do you even keep up with everything anymore. As a beginner in investing, it gets difficult staying on top of the news and getting the full lowdown of a stock you’re interested in. So, how does one do it? Seeking Alpha may be the answer you’re looking for. Seeking Alpha is one the largest investing communities that you can find. It’s a crowdsourced platform where people - from voluntarily contributing articles to the site. It helps the community get investment ideas, confirm any investment thesis and research on stocks. With over 15,000 contributors though, that’s just the tip of the iceberg. What is Seeking Alpha? Seeking Alpha has made a name for itself in the investment community as a place where over 15,000 people share their insights. These people include everyone from individuals just like you, who are investing their own money, to expert financial analysts. What makes this platform special is the wide range of opinions and analyses it offers, covering everything from individual stocks and investment strategies to predictions about the market's future. Seeking Alpha’s Subscription Types Seeking Alpha wants to make sure it has something for everyone, so it offers different levels of subscription: Basic - Free If you're just starting out, this gives you a taste of what's available with access to some articles, earnings call transcripts, and simple stock quotes. 2. Premium - $239/year For those looking to dive deeper into the investment world, this subscription provides everything from in-depth articles to sophisticated tools for tracking your investments. 3. Pro - $2400/year Aimed at the most serious investors and professionals, this level includes all the Premium features plus exclusive insights and direct contact with top analysts. Seeking Alpha Free VS Premium More On Crowdsourcing The crowdsourcing aspect of Seeking Alpha is a major advantage because it brings together a wide range of opinions and analyses on investments. Here's a simpler breakdown of why this is valuable: Diverse Opinions on Stocks: On Seeking Alpha, you might find different views on the same stock. For example, one writer might be optimistic (bullish) about a company's future because they see good things coming from market trends or new projects the company is starting. Another writer might be more pessimistic (bearish), pointing out issues like financial problems or tough competition. Having these different perspectives helps investors think more deeply and make better choices. Discussion and Debate: Below each article, there's a comments section that turns into a lively discussion area. People ask questions, debate points, and share their own experiences or insights. This can be really helpful because: - It adds more depth to the article's analysis, sometimes bringing up new points or considerations that weren't in the original article. - It might include insights from someone with special knowledge about the industry or from someone who has been following the company for a long time, offering deeper or different viewpoints. What Does The Internet Think On Trustpilot, users have given Seeking Alpha a solid rating of 4 out of 5 from 319 reviews. The highlights being the platform's excellent customer service, user-friendly interface, and insightful analysis and reports. However, some users have complained about the subscription billing, particularly concerning the lack of payment reminders and difficulties in obtaining refunds after. Seeking Alpha has responded to these concerns by reminding users to cancel their subscriptions at least a day before the renewal date to avoid unwanted charges. The Apple App Store shows an even higher user approval rating of 4.8 from 113.7K reviews. It mostly talks of Seeking Alpha's resourcefulness and the value it brings to its user base. Users also appreciate the depth of information available, helping in making informed investment decisions. The negative feedback primarily focuses on irrelevant discussions in the comment section and issues related to the app's functionality, which, while notable, doesn't take away from the platform's overall usefulness. Reddit's community offers a mixed bag of reviews. The positive comments highlight the value of Seeking Alpha's articles, which are viewed as pragmatic analysis shared by investors, providing differing perspectives and theories. This varied perspective is highly valued by users. However, the challenge of sifting through the contributions of over 15,000 authors to find high-quality articles or specific information is a notable downside. This aspect requires users to invest more effort in navigating the platform effectively. — Overall, users have found Seeking Alpha to be the go-to place for investors to find information, insights that range from investment ideas to in-depth analyses of specific sectors. The platform's strength lies not only in the diversity of opinions but also in the intensive discussion that often follows in the article comments section. It’s these discussions that adds to the value of the content, allowing investors to explore various viewpoints before making a decision. Additionally, the reliability of Seeking Alpha, according to these users, hinges more on the authors of the articles rather than the platform itself. Given its crowdsourced model, the quality and depth of analysis can vary. However, most articles provide substantial evidence to support their claims, presenting both "bear" and "bull" cases to ensure a balanced perspective. Users appreciate this depth, finding it helpful when conducting their own due diligence (or DD, as they often say). So, Is Premium Worth It? Regarding the cost-effectiveness of Seeking Alpha's subscription models, it varies based on your investment style, portfolio size, and reading habits. For those actively engaging with the platform—reading frequently, managing a sizeable and diverse portfolio—the Premium and Pro subscriptions can offer significant value. These higher-tier plans provide access to a wealth of resources, including in-depth analyses, portfolio management tools, and direct insights from seasoned investors. For beginners, the Basic subscription's free content is a rich source of knowledge, perfect for getting to grips with market trends and how different stocks perform. As you grow in your investment journey, considering a paid subscription could be a smart move, offering you the tools you need to more effectively navigate the complex world of the stock market. Special Promotion for Our Readers By the way, considering everything, we have actually arranged for special discounts on Seeking Alpha subscriptions just for you! Seeking Alpha Premium Usual Price: $239/year Special Offer: Use our exclusive link to subscribe for just $189/year **From the 27th of March - 3rd of April 2024, enjoy an additional $10 off when you use our exclusive link to subscribe. Alpha Picks Usual Price: $499/year Special Offer: Through us, only $449/year Commission Disclosure By using these offers, you also support us: we receive a 50% commission on your first transaction. Why Consider These Offers? Seeking Alpha Premium: Offers more than just a research platform; it includes a forum where professionals share their insights, offering a valuable perspective on investments. Alpha Picks: We didn’t talk about this much, but if you’re Interested in how Alpha Picks can improve your investment strategy through AI-driven stock selections, then click the like button, and we'll create a separate article explaining it in detail! Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Bitcoin is the buzzword of the decade. Even your grandma who knows nothing about investing has heard about it. But it can be very confusing and unintuitive to fully grasp it. Don’t worry, you are not alone. Around 80% of Malaysians are aware of cryptocurrencies, however, only 21% of them are actually familiar with it. Before you start investing in this unfamiliar territory - which is  a classic recipe for a poor investment choice, you should: Invest in what you know. This article series is made to help you with that. Tech is growing faster than ever and we need to keep up, and this article will equip you with crypto knowledge, regardless if you’re interested in investing or not (soon you will). It  will help you save time and point you in the right direction of research. Where do we start? The fundamental technology and platform of cryptocurrencies is the blockchain. Just as you can’t operate a car without its engine, cryptocurrencies wouldn’t exist or function without the underlying technology of blockchain. So, let’s dive into the technology first. Origins: Where did it come from? Blockchain can be dated back to the 1990s where Stuart Haber & W.Scott Stornetta, a group of research scientists, were finding a solution for time-stamping digital documents so they couldn’t be tempered or misdated with. No one furthered the progress of the blockchain into something revolutionary till… 2008, where the concept of “Distributed Blockchain” was first introduced in the white paper “Bitcoin: A peer to peer electronic cash system” by Satoshi Nakamoto. The white paper described the vision and protocol of a decentralized financial system with no involvement of a financial intermediary. Basically, it’s a financial system where the middle man A.K.A the banks are removed and it’s purely a peer-to-peer transaction on a universal public ledger. (A ledger is a collection of accounts where transactions are recorded. Every bank has its own record of ledger to keep track of the people’s money. Imagine, if there are around 44,000 banks with 44,000 ledgers of their own. Now, imagine, all those 44,000 ledgers are combined into one public-ledger where anyone can view.) In 2009, Satoshi Nakamoto launched the first block of the Bitcoin blockchain: The Genesis Block. And the rest is history. What is a blockchain? Essentially, blockchain is a decentralized database that stores a registry of assets and transactions across a peer-to-peer network. The transactions are secured through cryptography and over time, that transaction history gets locked in blocks of data that are cryptographically linked together and secure. This creates an immutable, unforgettable record of all of the transactions across this network (Bookmark this, we’ll explore it soon).  This record is replicated on every computer that uses the network. A great analogy given by Bettina Warbug, a blockchain researcher, to having a concept of Blockchain, is Wikipedia. We can see everything on Wikipedia. Just as Wikipedia provides a dynamic and ever-evolving composite view of information, allowing users to track changes over time, blockchain serves as an open infrastructure for storing various types of assets. While Wikipedia stores words and images and their alterations over time, blockchain encompasses a broader spectrum, accommodating assets such as digital currencies like Bitcoin, intellectual property titles, certificates, contracts, physical assets, and even personal identifiable information, all while preserving their ownership, custodianship, and location history. So why is it so important? To illustrate the importance of blockchain, we must first understand the problem blockchain is solving. The core problem blockchain aims to solve is: Trust. Trust in Institutions. But why? Financial institutions act as intermediaries for our financial transactions, they are the heart of the economy, pumping and exchanging value. Just like an organism, it breathes the outflow and inflow of money and currency for society. We rely on institutions as a medium to manage our trade and reduce uncertainty. Especially with the rise of globalization, institutions are essential in facilitating human economic activity. “Institutions are a tool to lower uncertainty so that we can connect and exchange all kinds of value in society”-Douglas North, Nobel Prize Winner in Economic Sciences. Despite our trust upon institutions, there have been a record of 7 major financial crises over the last century. The most infamous incident of the 2008 financial crisis was the last straw that broke the camel’s back. Also known as the Global Financial crisis was the most severe economic crisis since the Great Depression 1929. “The shock that hit the world economy in 2008 was on a par with that which launched the Depression.” - The Economist, University of Essex. Blockchain as a confidence machine: Blockchain is a confidence machine. Remember the bookmark from above? Immutable means it cannot be changed. All transactions in the blockchain cannot be erased and it is impossible for anyone to tamper with previous transactions. These qualities are the basis of confidence in the blockchain. Confidence is returned back to society via the participation of the public network node to verify transactions by themselves and for themselves. The blockchain's decentralized and open-source approach to trust helps bridge the gap in information sharing among governments, businesses, and individuals. This model reduces information asymmetries and uncertainty in financial decisions. Through the use of cryptography, blockchains establish a network of institutionalized trust, offering a viable alternative to the growing dependence on centralized entities which are controlling access to information. Lastly Companies from various industry sectors have been adopting this technology. Just to name a few: HSBC, Visa, Barclays, Ford, Pfizer, AIA and many more top leagues. But they're not using blockchain for cryptocurrency. That’s just the tip of the iceberg of the uses of block chain. Here is a list of other uses: Providing an opportunity to developing nations to participate in banking (around 1.7 billion adults have no access to banking services) Easing cross-border payments (average transaction fee for worldwide payments is 7%; yes, that’s a lot) Increase in interoperability in the supply chain management My favorite one: Managing and Protecting Patient data in Health care organizations. Imagine a decentralized log of patient data that is transparent and public for all hospitals to access.  You don’t have to worry about switching hospitals or needing a specific doctor for record keeping.  Your entire medical history can be accessed from anywhere, even globally. There is much more to discover with this new technology. Do like the article if you want to know more about how blockchain can positively impact the World and also on the flip side, the negative implications of it (there is a shadow side for everything). Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Let’s ignore how disgusting cockroaches are for a second. Let’s also forget how much fear they instil in us when they take flight. The thing is, if you think about it, cockroaches are impressive creatures. For instance, cockroaches have been around for more than 300 million years, making them one of the oldest groups of insects on Earth. Imagine how resilient and adaptable you’d have to be to survive through so many extreme environments. Plus, they’re still around, not even remotely close to extinction. Now that’s how resilient and adaptable we want our portfolios to be right, no matter the weather? The portfolio for any (economic) weather The normal approach to investing would be allocating 60% of your holdings into equity and 40% into debt investments. However, this ratio can be rocky when inflation is not under control. The reality is, these days, the market is starting to get volatile. There’s where the Cockroach Portfolio comes in. How does it work? First, you would want to place your money evenly across four types of assets: Equities, Gold, Cash and Bonds. These four types of assets are picked according to how well they perform for each ‘weather’, these include: Growth, Inflation, Deflation and Recession. By picking the assets which do well in each economic weather and rebalancing them, we create stability in volatile situations. What’s the catch? Yes, your portfolio will be relatively stable but don’t be expecting any high returns. Remember, high risk equals high returns, and the Cockroach Portfolio isn’t exactly high risk. During Growth - Use Equities: When the economy is doing well, like when people start spending more money, businesses, in turn, will make more money too. Stocks, which are tiny pieces of ownership in these businesses, can become more valuable during this time. So, if you own stocks, you can see the value of your investment go up. Additionally, when companies are making more money, they might share some of this profit with you in the form of dividends, which is like getting a little bonus just for owning the stocks. During Recessions - Use Cash: When lots of people are losing their jobs and businesses aren’t doing too well, it’s a good idea to have some cash saved up. Cash is great because it doesn’t lose its value during recessions, and it’s always ready to use. During Inflation - Use Gold: When there’s inflation, the value of money goes down. This means you’ll be buying less with the same amount of money. Gold, however, often keeps its value better than money during inflation. So, when prices are rising and money buys less, gold can still buy about the same amount of things, or even more. That’s why people sometimes buy gold when they think inflation will hit. During Deflation - Use Bonds: When there’s deflation, prices of goods and services decrease, which means your money can buy more than before. Bonds pay fixed interest, so if you own bonds during deflation, the money you get from them can buy more because of the lower prices. The Bottom Line The Cockroach Portfolio is best suited for beginners in investing. It’s a great strategy to manage your risk and enjoy stable returns. The core concept is diversifying our risk throughout different times. However, this doesn't mean you should avoid making adjustments, unless you're content with sticking to a "cockroach" strategy indefinitely. Adaptability through economic cycles is like riding a wave, and we have to stay alert and aware of it. After a few years of experience in the market, you can change the asset allocation based on the economic weather and have greater returns periodically rather than just a steady line. Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

You’ve just graduated, and you’re going through the process of landing your first job. While adulthood may be something you’ve been anticipating for a long time, it also comes with a new set of challenges and responsibilities. In Malaysia, or at least in Asian culture— it is a norm to give our parents money. What is the significance or importance for this you may ask? Most of us believe in the act of giving back to our parents for raising us. Providing a roof over our heads, putting us through school, getting us to where we are today. The least we can do when we land a job is to give back to our parents monetarily! However, with the rising costs and inflation rates in Malaysia, and most fresh graduates earning an amount that they themselves find hard to live on, it really poses the question on how much exactly you should give your parents. In this article, we’ll dive into some factors you can look into to determine how much you should be giving to your parents. Your current financial situation It is important to understand your current financial situation in order to determine how much money you can give your parents. Income and savings Do you have a stable job, or multiple streams of income that allows you to be less rigid with your finances? You will need to analyse and understand the stability and reliability of your sources of income for a more accurate picture of your financial situation. You should try to set a portion of your income towards a savings account or a savings plan, for rainy days. With that said, have you heard of the 50/30/20 rule? This is where you would allocate 50% of your income to your necessities, 30% on lifestyle choices, and 20% to your savings. However, this article has tweaked the rule to include investments, where it is proportioned into a 50/20/10/20 rule. 50% goes to necessities, 20% towards your lifestyle, 10% into savings and 20% into investments. Give it a read and understand how you can save AND invest as well! There are also a few market money funds in Malaysia that offer returns that are greater than most traditional savings accounts. These financial instruments are short-term, which also means that if there is a time you urgently need the money, it is always available for you. Loans and expenditure You will need to learn how to portion out your disposable income in order to understand how your money is distributed.  Firstly, do you have outstanding loans or debts? Maybe you’ve just made your first adult purchase on a house, or even a car. It is vital that you create a feasible repayment plan that will help reduce or even eliminate debts, to create financial stability in the long run. If you have outstanding debts and are struggling to strategise the best way to pay them off effectively, read this article to learn more! Secondly, you could list out all your essential monthly expenses. This could include your rent, groceries, insurance, utility bills, and more. Once you are able to grasp how much your monthly expenses are, you can set aside an amount for it, and allocate what is left accordingly. You should be able to proportion the remaining appropriately towards savings, spendings on wants, and how much can be given to your parents. There are also other means to give back to your parents rather than the conventional monthly allowance. Here are some ways you could give back instead: Help pay for what’s needed at home You can offer to pay for the weekly groceries for the house, or even help with the utility bills. This will definitely help lessen their financial burden, especially if your parents have retired and do not have a job. Weekly treats Take your mom for a spa-day, bring your dad to his favourite restaurant— these can be a means of giving back to your parents, and you can also spend some quality time together as a family! Those who are working may be spending less time with our loved ones, relative to when adulthood has not made its grand entrance yet. My personal experience In the early days of my career, my monthly earnings amounted to RM2500. While embarking on this exciting new chapter, I was also eager to express my gratitude to my parents for their unwavering support throughout my journey. However, as I divided my income between savings and essential expenses, I found myself with little left to offer in monetary support. With that said, I sought alternative ways to demonstrate my appreciation. I took on some household chores, prepared meals for my family on weekends, and indulged in occasional "mommy-daughter" outings to the nail parlour. As my career progressed and I transitioned to a new role with a more substantial income, I found myself in a position to provide financial support to my parents. Now, I can comfortably allocate RM200 monthly to my mother, and contribute to my father by assisting with utility expenses at home. It's a small but meaningful way to reciprocate the love and sacrifice they've poured into my life. As you navigate this new phase of life, remember the importance of financial responsibility and open communication. While expressing gratitude through monetary means is commendable, it's equally vital to secure your own financial foundation. By balancing your obligations and aspirations, you can support your parents while safeguarding your own financial well-being. Ultimately, the goal is not just to give back, but to do so responsibly, ensuring a harmonious balance between supporting your family financially and your personal financial goals. Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Imagine this: you’ve just received your first pay check as a full-time employee. You’ve been diligently waiting for this moment, proving yourself to your employer and colleagues for months. Now, it’s time to treat yourself, right? You spend this money on new clothes or a fresh haircut. You start eating out more. You might even join the gym. All the luxuries you couldn’t afford on a fresh grad pay check. You wonder how you could have stayed broke for so long. Welcome to the world of lifestyle inflation: the habit of upping your spendings as your earnings climb. And it’s not an ideal habit to have. What’s the point of making more money if I can’t spend it? Don’t get me wrong. There’s nothing wrong with wanting to spend your money, especially to improve the quality of your life. But it’s more about striking that balance between planning for your future and enjoying the fruits of your labour right now. What happens if you don’t find this balance? You might actually end up in a cycle of living pay check to pay check. It causes you to have just enough money to last you to the end of the month. You might even find it difficult to pay off your debts because of this. How do I know if I have lifestyle inflation? Here's a heads-up on whether you're veering towards lifestyle inflation: Credit card debt If your credit card's burning up with debt, yet you're still living large with daily Grabs and monthly splurges, you might want to hit the brakes. Lack of safety net Do you have any cash to fall back on should anything happen to you? Like, an unexpected trip to the hospital or sudden unemployment? It’s not really for you Think about whether you're buying things because they make you happy or just to impress others. How do I avoid lifestyle inflation and still enjoy life? Don’t lose motivation just yet, it is possible to enjoy life to the fullest while still setting money aside for your future. Here’s how: 1. Calculate the real change You’ll actually find that the net effect of your raise is less significant than it appears. This happens because a portion of your money is going to EPF and taxes. Do the math to see what you're really working with. 2. Think about the hidden costs If you can afford the down payment for a car, don’t forget the ongoing expenses that come with it - gas, maintenance, insurance and road tax. The costs don't just end there. 3. Be mindful when spending money Create a budget that forces you to spend within your means. Unfortunately, this includes all your retail therapy too. 4. Start building that emergency fund Resist the urge to blow that extra cash. Aim to tuck away 20% of your income into a no-touch account. 5. Invest in experiences Can't justify the costs of a new car? Opt for travel instead. Cuti-cuti Malaysia counts too! The memories and shared experiences often outweigh material possessions in the happiness department. The bottom line It's important to manage your money wisely as you start earning more. This means enjoying your earnings while also saving for the future. By being careful with your spending and focusing on what truly makes you happy, you can avoid the trap of lifestyle inflation.