The fuel price hike on Sept 3 came as a surprise to many Malaysians (RON95 petrol went up by 20 sen a litre, and RON97 rose 15 sen a litre two days later). Here are eight things you can do to keep your fuel costs down.
1.Keep your tyres inflated
Properly inflated tyres have less contact with the road, which helps reduce friction, and hence petrol consumption. That also helps preserve the integrity of your tyres, and give you a safer drive.
2.Swipe a credit card
Many banks offer fuel incentives. For example, CIMB’s Petronas MasterCard and Citibank’s Shell Gold Visa Credit Card offer up to 8% in fuel rebates. Loyalty programmes such as the Petronas Mesra Card, offer points for fuel redemption.
3.Drive smoothly
Instead of accelerating and braking harshly when driving, slow down before coming to a complete stop. With momentum driving, you will be saving petrol. And don’t rev your vehicle.
4.Eliminate excess weight
Unnecessary weight makes your engine work harder.
5.Consider carpooling
Say goodbye to lonely drives home. Enjoy the company of others and shave your petrol budget.
6.Avoid idling
If you’re waiting more than a minute, switch off the engine.
7.Avoid peak-hour driving
The higher the gear you drive in, the lower your engine speed (number of revolutions at which the crankshaft turns). A lower engine speed can improve fuel efficiency, so avoid peak-hour driving.
8.Give public transport a chance
Is your workplace close to an LRT station? Park and ride.
theedge
Showing posts with label TIPS. Show all posts
Showing posts with label TIPS. Show all posts
Saturday, November 9, 2013
Wednesday, October 30, 2013
8 Ways Of Controlling Your Personal Debt
Learn how to control your personal debt and accomplish your financial goals, by making your personal debt work for you.
1. Some debt is good.
Borrowing for a home or college usually makes good sense. Just make sure you don't borrow more than you can afford to pay back, and shop around for the best rates.
2. Some debt is bad.
Don't use a credit card to pay for things you consume quickly, such as meals and vacations, if you can't afford to pay off your monthly bill in full in a month or two. There's no faster way to fall into debt. Instead, put aside some cash each month for these items so you can pay the bill in full. If there's something you really want, but it's expensive, save for it over a period of weeks or months before charging it so that you can pay the balance when it's due and avoid interest charges.
3. Get a handle on your spending.
Most people spend thousands of dollars without much thought to what they're buying. Write down everything you spend for a month, cut back on things you don't need, and start saving the money left over or use it to reduce your debt more quickly.
4. Pay off your highest-rate debts first.
The key to getting out of debt efficiently is first to pay down the balances of loans or credit cards that charge the most interest while paying at least the minimum due on all your other debt. Once the high-interest debt is paid down, tackle the next highest, and so on.
5. Don't fall into the minimum trap.
If you just pay the minimum due on credit-card bills, you'll barely cover the interest you owe, to say nothing of the principal. It will take you years to pay off your balance, and potentially you'll end up spending thousands of dollars more than the original amount you charged.
6. Expect the unexpected.
Build a cash cushion worth three months to six months of living expenses in case of an emergency. If you don't have an emergency fund, a broken or damaged car can seriously upset your finances.
7. Don't be so quick to pay down your mortgage.
Don't pour all your cash into paying off a mortgage if you have other debt. Mortgages tend to have lower interest rates than other debt, and you may deduct the interest you pay on the first $1 million of a mortgage loan. (If your mortgage has a high rate and you want to lower your monthly payments, consider refinancing.)
8. Get help as soon as you need it.
If you have more debt than you can manage, get help before your debt breaks your back. There are reputable debt counseling agencies that may be able to consolidate your debt and assist you in better managing your finances. But there are also a lot of disreputable agencies out there.
1. Some debt is good.
Borrowing for a home or college usually makes good sense. Just make sure you don't borrow more than you can afford to pay back, and shop around for the best rates.
2. Some debt is bad.
Don't use a credit card to pay for things you consume quickly, such as meals and vacations, if you can't afford to pay off your monthly bill in full in a month or two. There's no faster way to fall into debt. Instead, put aside some cash each month for these items so you can pay the bill in full. If there's something you really want, but it's expensive, save for it over a period of weeks or months before charging it so that you can pay the balance when it's due and avoid interest charges.
3. Get a handle on your spending.
Most people spend thousands of dollars without much thought to what they're buying. Write down everything you spend for a month, cut back on things you don't need, and start saving the money left over or use it to reduce your debt more quickly.
4. Pay off your highest-rate debts first.
The key to getting out of debt efficiently is first to pay down the balances of loans or credit cards that charge the most interest while paying at least the minimum due on all your other debt. Once the high-interest debt is paid down, tackle the next highest, and so on.
5. Don't fall into the minimum trap.
If you just pay the minimum due on credit-card bills, you'll barely cover the interest you owe, to say nothing of the principal. It will take you years to pay off your balance, and potentially you'll end up spending thousands of dollars more than the original amount you charged.
6. Expect the unexpected.
Build a cash cushion worth three months to six months of living expenses in case of an emergency. If you don't have an emergency fund, a broken or damaged car can seriously upset your finances.
7. Don't be so quick to pay down your mortgage.
Don't pour all your cash into paying off a mortgage if you have other debt. Mortgages tend to have lower interest rates than other debt, and you may deduct the interest you pay on the first $1 million of a mortgage loan. (If your mortgage has a high rate and you want to lower your monthly payments, consider refinancing.)
8. Get help as soon as you need it.
If you have more debt than you can manage, get help before your debt breaks your back. There are reputable debt counseling agencies that may be able to consolidate your debt and assist you in better managing your finances. But there are also a lot of disreputable agencies out there.
10 steps to making a financial budget
1. Budgets are a necessary evil.
They're the only practical way to get a grip on your spending - and to make sure your money is being used the way you want it to be used.
2. Creating a budget generally requires three steps.
- Identify how you're spending money now.
- Evaluate your current spending and set goals that take into account your long-term financial objectives.
- Track your spending to make sure it stays within those guidelines.
3. Use software to save grief.
If you use a personal-finance program such as Quicken or Microsoft Money, the built-in budget-making tools can create your budget for you.
4. Don't drive yourself nuts.
One drawback of monitoring your spending by computer is that it encourages overzealous attention to detail. Once you determine which categories of spending can and should be cut (or expanded), concentrate on those categories and worry less about other aspects of your spending.
5. Watch out for cash leakage.
If withdrawals from the ATM machine evaporate from your pocket without apparent explanation, it's time to keep better records. In general, if you find yourself returning to the ATM more than once a week or so, you need to examine where that cash is going.
6. Spending beyond your limits is dangerous.
But if you do, you've got plenty of company. Government figures show that many households with total income of $50,000 or less are spending more than they bring in. This doesn't make you an automatic candidate for bankruptcy - but it's definitely a sign you need to make some serious spending cuts.
7. Beware of luxuries dressed up as necessities.
If your income doesn't cover your costs, then some of your spending is probably for luxuries - even if you've been considering them to be filling a real need.
8. Tithe yourself.
Aim to spend no more than 90% of your income. That way, you'll have the other 10% left to save for your big-picture items.
9. Don't count on windfalls.
When projecting the amount of money you can live on, don't include dollars that you can't be sure you'll receive, such as year-end bonuses, tax refunds or investment gains.
10. Beware of spending creep.
As your annual income climbs from raises, promotions and smart investing, don't start spending for luxuries until you're sure that you're staying ahead of inflation. It's better to use those income increases as an excuse to save more.
They're the only practical way to get a grip on your spending - and to make sure your money is being used the way you want it to be used.
2. Creating a budget generally requires three steps.
- Identify how you're spending money now.
- Evaluate your current spending and set goals that take into account your long-term financial objectives.
- Track your spending to make sure it stays within those guidelines.
3. Use software to save grief.
If you use a personal-finance program such as Quicken or Microsoft Money, the built-in budget-making tools can create your budget for you.
4. Don't drive yourself nuts.
One drawback of monitoring your spending by computer is that it encourages overzealous attention to detail. Once you determine which categories of spending can and should be cut (or expanded), concentrate on those categories and worry less about other aspects of your spending.
5. Watch out for cash leakage.
If withdrawals from the ATM machine evaporate from your pocket without apparent explanation, it's time to keep better records. In general, if you find yourself returning to the ATM more than once a week or so, you need to examine where that cash is going.
6. Spending beyond your limits is dangerous.
But if you do, you've got plenty of company. Government figures show that many households with total income of $50,000 or less are spending more than they bring in. This doesn't make you an automatic candidate for bankruptcy - but it's definitely a sign you need to make some serious spending cuts.
7. Beware of luxuries dressed up as necessities.
If your income doesn't cover your costs, then some of your spending is probably for luxuries - even if you've been considering them to be filling a real need.
8. Tithe yourself.
Aim to spend no more than 90% of your income. That way, you'll have the other 10% left to save for your big-picture items.
9. Don't count on windfalls.
When projecting the amount of money you can live on, don't include dollars that you can't be sure you'll receive, such as year-end bonuses, tax refunds or investment gains.
10. Beware of spending creep.
As your annual income climbs from raises, promotions and smart investing, don't start spending for luxuries until you're sure that you're staying ahead of inflation. It's better to use those income increases as an excuse to save more.
Sunday, October 27, 2013
Five Financial Must-Haves for First Time Home Buyer (in Malaysia)
Here are five financial prerequisites that are musts before you sign on the Sales and Purchase Agreement (SPA).
1. Have adequate Down Payment
Whether you are buying directly from developer or from seller at the subsale market, you must have the down payment of 5-15%. The first step of buying after you’ve identify your desired house, is to sign the booking form and pay 1-2% earnest deposit, or the booking fees. This will allow 14 days for you to arrange for SPA signing.
Upon signing the SPA, you will be required to pay the remaining down payment that adds up to the total of 10%. After that, you’ll need to finance the rest of the purchase price with a bank loan, assuming that you don’t have the ready cash to pay in full. In some cases, depending on the type of the property and your credibility, you may get lower or higher financing margin compared to the industry standard of 90% financing.
If the banks only lend you 85% of the purchase price, you will need to fork out another 5% for the difference. Of course, there are cases with literally no money down. But you will still be required to fork out the down payment and get it back in short term period due to some smart negotiations, special discount or rebate from developer, or creative financing. So the first financial must is to have 5-15% of the down payment accumulated.
2. Estimate How Much Can you Borrow
After you’ve got your down payment ready, the next thing you want to find out is how much installment you can afford to fork out every month. This will determine how big the loan amount you can take. Nowadays, banks are getting more stringent.Your loan servicing affordability is assessed by calculating your personal Debt Service Ratio (DSR).
DSR is equal to your total monthly debt repayment obligation, divided by monthly take-home income (that’s after tax and EPF contribution). Bank Negara requires the bank not to lend borrower more than 60% DSR. In other words, if your take home pay is RM5000/month, you will be able to serve a loan payment of RM3000.
However, it is really not recommended to go for the limit. I would recommend that you keep your DSR under 30%. And this 30% should also include your car loan. Depending on the loan tenure, the younger you are, the longer term you can take, probably up to 30-40 years to completely pay up the mortgage.
At the current interest rate of about 4.3%, and 30 years loan tenure, a monthly payment of RM1000 can serve a loan amount up to RM200,000. After knowing how much you can borrow, the next financial must have is to understand how much you can really afford to pay every month.
3. Understand How much Can you Afford
When you have your own home, there are other related expenses that comes with it, other than the monthly mortgage installment. First, is the maintenance fee if your property is in a gated and guarded community, or a high rise building.
Secondly, you will also need to pay yearly fire insurance premium, quit rent and assessment. Thirdly, there are also regular expenses such as Indah Water Konsortium, water and electricity bill, not mentioning the initial deposit for all these utilities.
Therefore, you’ll need to understand that your expenses will increase when you are staying at your own house, comparing to staying with your parents or renting a place. So how much exactly can you afford? A thorough calculation is recommended.
4 Transaction cost
When making a home purchase, there are also other one time fees that can’t be neglected. You may need to pay real estate broker commission who helps you hunt for houses. There are also legal fees involved to prepare the SPA and also the loan agreement.
Besides that, the biggest amount of all is the stamp duty payable to the government.
SPA Stamp Duty Rates:
First RM 100,000.00 = 1%
Next RM 100,000.01 – RM 500,000.00 = 2%
Next RM 500,000.01 – RM 2,0100,000.00 = 3%
Above RM 2,000,000.00 = 4%
Meanwhile, the loan agreement stamp duty rate is 0.5% for any amount. So all these transaction expenses can add up to a total of about 5% of the purchase price, easily.
5. Get ready with Renovation and Furnishing Cost
After the house keys are handed to you as the proud new homeowner, you will get to do more alteration and enhancement, which will definitely incur some renovation and furnishing. You can always decide the enhancement that suits your budget.
No matter how frugal you are, there will be some basic furnishing required before you can stay comfortably in your new home. So get ready with a minimum fund to cover this inevitable expense. Buying your own home is probably one of the biggest and most important financial decision in your life.
Some people depleted all their accumulated savings after the purchase. Some even incur more consumer debts when they swipe credit cards and opt for installment payback to furnish their home. However, at the end of the day, it is a different feeling, which is more towards satisfaction and fulfilment when you are able to stay in a property that has your name in the ownership title.
kclau.com
1. Have adequate Down Payment
Whether you are buying directly from developer or from seller at the subsale market, you must have the down payment of 5-15%. The first step of buying after you’ve identify your desired house, is to sign the booking form and pay 1-2% earnest deposit, or the booking fees. This will allow 14 days for you to arrange for SPA signing.
Upon signing the SPA, you will be required to pay the remaining down payment that adds up to the total of 10%. After that, you’ll need to finance the rest of the purchase price with a bank loan, assuming that you don’t have the ready cash to pay in full. In some cases, depending on the type of the property and your credibility, you may get lower or higher financing margin compared to the industry standard of 90% financing.
If the banks only lend you 85% of the purchase price, you will need to fork out another 5% for the difference. Of course, there are cases with literally no money down. But you will still be required to fork out the down payment and get it back in short term period due to some smart negotiations, special discount or rebate from developer, or creative financing. So the first financial must is to have 5-15% of the down payment accumulated.
2. Estimate How Much Can you Borrow
After you’ve got your down payment ready, the next thing you want to find out is how much installment you can afford to fork out every month. This will determine how big the loan amount you can take. Nowadays, banks are getting more stringent.Your loan servicing affordability is assessed by calculating your personal Debt Service Ratio (DSR).
DSR is equal to your total monthly debt repayment obligation, divided by monthly take-home income (that’s after tax and EPF contribution). Bank Negara requires the bank not to lend borrower more than 60% DSR. In other words, if your take home pay is RM5000/month, you will be able to serve a loan payment of RM3000.
However, it is really not recommended to go for the limit. I would recommend that you keep your DSR under 30%. And this 30% should also include your car loan. Depending on the loan tenure, the younger you are, the longer term you can take, probably up to 30-40 years to completely pay up the mortgage.
At the current interest rate of about 4.3%, and 30 years loan tenure, a monthly payment of RM1000 can serve a loan amount up to RM200,000. After knowing how much you can borrow, the next financial must have is to understand how much you can really afford to pay every month.
3. Understand How much Can you Afford
When you have your own home, there are other related expenses that comes with it, other than the monthly mortgage installment. First, is the maintenance fee if your property is in a gated and guarded community, or a high rise building.
Secondly, you will also need to pay yearly fire insurance premium, quit rent and assessment. Thirdly, there are also regular expenses such as Indah Water Konsortium, water and electricity bill, not mentioning the initial deposit for all these utilities.
Therefore, you’ll need to understand that your expenses will increase when you are staying at your own house, comparing to staying with your parents or renting a place. So how much exactly can you afford? A thorough calculation is recommended.
4 Transaction cost
When making a home purchase, there are also other one time fees that can’t be neglected. You may need to pay real estate broker commission who helps you hunt for houses. There are also legal fees involved to prepare the SPA and also the loan agreement.
Besides that, the biggest amount of all is the stamp duty payable to the government.
SPA Stamp Duty Rates:
First RM 100,000.00 = 1%
Next RM 100,000.01 – RM 500,000.00 = 2%
Next RM 500,000.01 – RM 2,0100,000.00 = 3%
Above RM 2,000,000.00 = 4%
Meanwhile, the loan agreement stamp duty rate is 0.5% for any amount. So all these transaction expenses can add up to a total of about 5% of the purchase price, easily.
5. Get ready with Renovation and Furnishing Cost
After the house keys are handed to you as the proud new homeowner, you will get to do more alteration and enhancement, which will definitely incur some renovation and furnishing. You can always decide the enhancement that suits your budget.
No matter how frugal you are, there will be some basic furnishing required before you can stay comfortably in your new home. So get ready with a minimum fund to cover this inevitable expense. Buying your own home is probably one of the biggest and most important financial decision in your life.
Some people depleted all their accumulated savings after the purchase. Some even incur more consumer debts when they swipe credit cards and opt for installment payback to furnish their home. However, at the end of the day, it is a different feeling, which is more towards satisfaction and fulfilment when you are able to stay in a property that has your name in the ownership title.
kclau.com
Saturday, October 26, 2013
5 Moments You're Most Likely to Overspend
When You're Avoiding the Crowds
You may be tempted to tackle your shopping list during the morning on a weekday, when the stores is practically guaranteed to be blessedly empty. But shopping at crowded stores could help your wallet: We're less likely to buy unnecessary items when we're surrounded by swarms of people.It's like we go into survival mode, where we immediately think of what we need to get in and get out (and emerge relatively unscathed)
When You've Opened Another Bank Account
Study found that people tend to save more when they have just one place to deposit money. That's because they have a better knowledge of how much is there—and how much they're spending, researchers say. When our income is spread across a few places, we can easily justify a purchase by thinking, "Oh, but I have money in that other account, too."
When You're Buying Something Embarrassing
If you've ever bought some candy, a magazine or a collector's edition DVD box set to deflect from what you really need to pick up (ahem, antifungal foot cream), you're not alone: almost 80 percent of people spend money on unnecessary extras to divert the cashier's and other shoppers' attention
If the thought of buying just the item you really need makes you anxious, search for a distraction purchase you'll use, like paper towels or toothpaste.
When You Could Use a Little Support
It's no surprise that we're likely to splurge when we're feeling down, but 75 percent of women say they're shopping to treat someone else, finds University of Hertfordshire research. Sadness can make us crave others' support.Buying gifts for those we care about can help us feel more connected to them when money is tight, it's easier to justify spending on someone other than ourselves.
When You're Reminded of the Time
The clock can rule our schedules, our thoughts and, as it turns out, our bank accounts. When a sign encouraged people to "spend a little time, enjoy C&D's lemonade," they were more likely to stop and buy a drink—and pay 51 percent more for it (compared to a those who saw a sign that asked them to "spend a little money"). Why? In the 2008 study from Stanford University, researchers found that 'spending time' makes us feel more like we're buying an experience, not parting with our hard-earned cash.
The subtle shift is enough to make us feel like we're investing in something to do—which most other research states will make us happier than material possessions—but in essence, it's just stuff masquerading as an experience.
You may be tempted to tackle your shopping list during the morning on a weekday, when the stores is practically guaranteed to be blessedly empty. But shopping at crowded stores could help your wallet: We're less likely to buy unnecessary items when we're surrounded by swarms of people.It's like we go into survival mode, where we immediately think of what we need to get in and get out (and emerge relatively unscathed)
When You've Opened Another Bank Account
Study found that people tend to save more when they have just one place to deposit money. That's because they have a better knowledge of how much is there—and how much they're spending, researchers say. When our income is spread across a few places, we can easily justify a purchase by thinking, "Oh, but I have money in that other account, too."
When You're Buying Something Embarrassing
If you've ever bought some candy, a magazine or a collector's edition DVD box set to deflect from what you really need to pick up (ahem, antifungal foot cream), you're not alone: almost 80 percent of people spend money on unnecessary extras to divert the cashier's and other shoppers' attention
If the thought of buying just the item you really need makes you anxious, search for a distraction purchase you'll use, like paper towels or toothpaste.
When You Could Use a Little Support
It's no surprise that we're likely to splurge when we're feeling down, but 75 percent of women say they're shopping to treat someone else, finds University of Hertfordshire research. Sadness can make us crave others' support.Buying gifts for those we care about can help us feel more connected to them when money is tight, it's easier to justify spending on someone other than ourselves.
When You're Reminded of the Time
The clock can rule our schedules, our thoughts and, as it turns out, our bank accounts. When a sign encouraged people to "spend a little time, enjoy C&D's lemonade," they were more likely to stop and buy a drink—and pay 51 percent more for it (compared to a those who saw a sign that asked them to "spend a little money"). Why? In the 2008 study from Stanford University, researchers found that 'spending time' makes us feel more like we're buying an experience, not parting with our hard-earned cash.
The subtle shift is enough to make us feel like we're investing in something to do—which most other research states will make us happier than material possessions—but in essence, it's just stuff masquerading as an experience.
Tuesday, July 2, 2013
Comparing personal loan & credit card!
When in need of urgent cash many people resort to taking cash advance from their credit cards. It is interesting to note that unless the outstanding amount is settled in time the credit cards charge substantial interest on annual basis on the unpaid amount till such time the dues are cleared. This is clearly a huge interest to pay in the current scenario. Additionally when there are outstanding dues any further expenditure made is also charged at the hiked up penalty rates of interest. In many cases people take personal loans to settle the outstanding dues of their credit cards. There are differing views on this kind of financial management as the losses in terms of interest paid are high in both cases.
In favor of the Credit Card cash Advance
There are a few definite advantage of taking cash advance through the credit card which is the reason why so many people use it in the first place. Some these benefits are:
There is absolutely no delay in sanction as one can just walk up to an ATM and withdraw the money.
One has the option of drawing exactly the amount that is needed and not more.
There is no requirement to approach any bank and the money is accessible from remote locations in case of emergencies.
Repayment schedule of the cash advance is as per choice of the burrower and not as per the banks fixed schedule.
There are no prepayment penalty charges for credit card cash advance.
In case one is able to clear off the dues within the interest free period then this option works out to be the cheapest.
In favor of the Personal Loan
Since one avails such facility during period of urgent cash requirements the chances that one will be able to pay off immediately afterwards are less. In case of a credit card if one cannot pay back in time the costs are prohibitive. However in the case of personal loans:
The repayment period is suitably long to give the burrower some breathing space while repaying.
The interest rate of a personal loan though higher than other loans is still less than half of the penal interest that is charged on outstanding amount of credit card dues.
The amount that one can withdraw through a credit card cash advance is limited while in case of personal loans the amount is much more which can make a significant difference to needs of the burrower.
While both the means of raising instant funds have their own pros and cons it is for the customer to decide as per his own financial status.
Tuesday, June 25, 2013
How to Find a Personal Loan with the Lowest Interest Rate.
When it comes to personal loan, getting one with the lowest interest rate is undoubtedly the top priority for most people. After all, money is hard to come by and there’s no worse feeling than paying unnecessary extras when you know you could be doing otherwise.
So how does one go about getting a personal loan with the best interest rate? You could, of course, take a few days off, go visit every bank you know and talk to all the loan officers out there – a task that is not only time-consuming, but tedious and tiring all at the same time.
Alternatively, you could simply leverage on the power of the Internet and use an online personal loan comparison table to analyse the interest rates by all major banks of Malaysia for the amount you have in mind; then go directly to your bank-of-choice.
4 Simple Steps to Finding the Personal Loan with the Lowest Interest Rate
Go to an online personal loan comparison table.
Key in the loan figure and your envisaged repayment period. If required, key in your current salary.
Go through the list of identified banks – focus your attention on the interest rates as well as any special clauses and terms that might affect your decision to use that bank.
Finally, visit your chosen bank personally to begin the application process. If you wish, you may also opt to apply for your loan online.
And that’s really it! For those of you who were expecting some complex process or formula, know that a personal loan is one of the simplest banking products in the market and hence, finding the right one with the lowest interest rate should be relatively straightforward.
So the next time you’re looking for a personal loan with the best interest rate, just follow the simple steps above and you should be able to get the loan package you’re looking for in no time!
Why Most People are Not Saving Enough for Retirement
To retire or not to retire? I believe that is really not an option for most people. Retiring is only the privileged few, like, the 5% of the population who can really retire financially independent.
The majority of the people not only do not have the option to retire with financial independence, but they do not even have the option to retire at all. So, why is that the case?
We have to take a look at the problem. Assuming you start working at 25,most of us may start slightly earlier – and assuming you would retire from work at 55.
According to our Malaysian latest mortality rate, meaning how long Malaysians live, it has been said that we live to about 75 years old. We are not talking about now, so let’s take it further, about 20 to 30 years later although Malaysians will certainly live longer. Let’s say we retire from life at 85.
We can separate our life phases in to these two distinct phases called:
Accumulation phase – This is from when you are 25-55, or your working years.
Consumption phase, which is from 55-85 years old.
Do you see the problem? We have thirty years of working and thirty years of not working, meaning we will be consuming our savings. It simply means that each year of our working life, we will be actually saving for each year of our retirement years. At this point you cannot afford not to miss a years of savings because for each year of saving that you miss, you may not have enough for your retirement.
There’s another problem: How much do we save while we are working? Assuming all of us employees and you have EPF. If we have EPF we put aside 11% while our employer tops up another 12%. So, we get 23% going in to our EPF every month.
However, when we retire, we would need, a minimum of 50% of your last drawn salary. However your last drawn salary may be our highest income, assuming RM10,000. So, we would need about 50% of that, which would be RM5,000. Imagine why this is a problem. We need 50% but we are only putting 23% while we are working. That means there is a shortfall of 27% or more than a quarter.
EPF statistics(2011) say 50% of retirees spend their entire EPF savings within 5 years. This is the problem.
courtesy KCL
How the Poor, the Middle Class, and the Rich Think about Investment
How the Poor, the Middle Class, and the Rich Think about Investment
The poor don’t invest because they don’t have money to invest. They spend all their money and forget about investments. The funny thing is though, although they have no money to invest, they have money to gamble. They have money to buy lottery, they have money to buy 4D and 3D, go to Genting and gamble a few thousand Ringgit, travel with Star Cruise, drink alcohol and smoke.
For all these money-burning activities, the poor have money. When it comes to investing, they have no money.
Now, the middle class is actually where most people you see or meet are. The middle class say, “Investing is Risky.” Every time people say investing is risky, they actually mean that speculating or gambling is risky. Most people cannot differentiate between speculating and investing.
Understanding about the difference between investing and speculating is very important. If you still cannot differentiate, then just follow this simple definition. -anything that can make money and can lose money is gambling or speculating.
Investing, if you do it the right way, you cannot lose money. This doesn’t mean that you never lose money, but as a whole you cannot lose money. Just like in a casino. If you are a casino owner, you may lose at individual rounds, but as a whole if you combine all the tables and bets, you cannot lose.
As for the rich, instead of saying, “Investing is risky,” the rich will say, “Not investing is risky.” Why do you think the rich would say so?
Inflation eats our money away. If you don’t invest, your money will be eaten by inflation.
So, why is not investing risky? Because if you don’t invest, your money will be in your savings account, or FD, or EPF where you look for all the guaranteed things and so forth, plus all your money will be eaten by inflation.
Secondly, you face another risk which is “you don’t have enough money” risk – the risk of having not enough money. You don’t have enough money for your kids’ education, not enough for your retirement, maybe not enough for your parents’ hospital bills in the future and maybe your own hospital bills in the future as well.
If you talk about insurance, the insurance might be so costly that you could barely afford to pay for it unless you plan to work for life. Even if you plan to work for life, you still face another risk: Whether people will still hire you when you’re old, and whether you can still work or not when you’re old. In that sense, even if you don’t invest you are facing many risks, which is why, to the rich, not investing is also a risk.
Another risk of not investing is that your money will grow too slowly. What if got you into an illness and cannot work anymore? When you cannot work anymore, all your financial goals are not met, and you have financial liabilities.
So, investing actually expedites financial security if you do it the right way. Not speculating or gambling – but Investing.
courtesy KCL
The poor don’t invest because they don’t have money to invest. They spend all their money and forget about investments. The funny thing is though, although they have no money to invest, they have money to gamble. They have money to buy lottery, they have money to buy 4D and 3D, go to Genting and gamble a few thousand Ringgit, travel with Star Cruise, drink alcohol and smoke.
For all these money-burning activities, the poor have money. When it comes to investing, they have no money.
Now, the middle class is actually where most people you see or meet are. The middle class say, “Investing is Risky.” Every time people say investing is risky, they actually mean that speculating or gambling is risky. Most people cannot differentiate between speculating and investing.
Understanding about the difference between investing and speculating is very important. If you still cannot differentiate, then just follow this simple definition. -anything that can make money and can lose money is gambling or speculating.
Investing, if you do it the right way, you cannot lose money. This doesn’t mean that you never lose money, but as a whole you cannot lose money. Just like in a casino. If you are a casino owner, you may lose at individual rounds, but as a whole if you combine all the tables and bets, you cannot lose.
As for the rich, instead of saying, “Investing is risky,” the rich will say, “Not investing is risky.” Why do you think the rich would say so?
Inflation eats our money away. If you don’t invest, your money will be eaten by inflation.
So, why is not investing risky? Because if you don’t invest, your money will be in your savings account, or FD, or EPF where you look for all the guaranteed things and so forth, plus all your money will be eaten by inflation.
Secondly, you face another risk which is “you don’t have enough money” risk – the risk of having not enough money. You don’t have enough money for your kids’ education, not enough for your retirement, maybe not enough for your parents’ hospital bills in the future and maybe your own hospital bills in the future as well.
If you talk about insurance, the insurance might be so costly that you could barely afford to pay for it unless you plan to work for life. Even if you plan to work for life, you still face another risk: Whether people will still hire you when you’re old, and whether you can still work or not when you’re old. In that sense, even if you don’t invest you are facing many risks, which is why, to the rich, not investing is also a risk.
Another risk of not investing is that your money will grow too slowly. What if got you into an illness and cannot work anymore? When you cannot work anymore, all your financial goals are not met, and you have financial liabilities.
So, investing actually expedites financial security if you do it the right way. Not speculating or gambling – but Investing.
courtesy KCL
The Biggest Challenge to Increase Your Income This Year
Every beginning of the year, most of us have a common activity, that is to make your new year’s resolution. When you are still studying in school, the normal resolution would be to study harder, get more ‘A’s in the exams. As we grow older and into adulthood, the common resolution would be to make more money.
Think about it. If you are in the sales department, or a business owner or a self-employed salesperson, the very first goal you would set for the year is how much increment you want on the sales revenue.
If you are under employment, your boss will give you a new set of higher key performance indicator (KPI). You would probably commit to perform better and try to get a raise, if not a promotion on the coming round of performance review. Most likely, most new year resolution has something to do with money and earning more income.
Setting a Higher Goal
When it comes to personal financial matter, I normally urge people to set a higher target of savings and investments. It is easier to achieve if you can make a higher income this year compared to last year. Of course, bigger goal comes with bigger challenges. I’ll talk about the biggest challenge of all in this article. Just a hint – it is not about the lack of discipline, lack of strategies, lack of time…You can make a guess now but keep on reading.
What’s your New Year Resolution?
Okay, enough about money. What about other types of resolutions you set for the new year? If you want a better relationship with your family, you might commit to spend extra time with your kids, or date your spouse more, like at least once in a week. When you spend that extra time with your kid, you want to really get into their world, and not just letting your son to play on the iPad while you watch the latest TV shows.
If you have a new year resolution to have a healthier body, you might have committed to eat more vegetables and cut down your fat intake. You might subscribed to a gym in order to work out more frequently. Extra effort needed if you really want to look good and young.
Some people also have a resolution to travel to certain places. For example, I have a friend who blocks out the vacation dates on his calendar. He knows exactly where he will be visiting for the whole year. Air tickets are booked early and he will simply reject all other events including wedding invitation that falls within his vacation period.
All these different resolution is believed to be able to contribute to your overall happiness. More or less, each one of those commitment is going to make your life better. Assuming that you successfully make it all, you are supposed to live happier, healthier and wealthier at the end of the year.
Making a new year’s resolution is easy. The big problem now is how to do it all. All these stuff require not just money, but also a lot of your time commitment and effort. These two resources is what majority of us lack of.
For example, if you spend more time to make money, you are left with not much time to spend on building a better relationship. You don’t have much energy to exercise and build a healthier body. Under stressful working environment, some people even tends to eat more just to relieve the pressure.
Here is the biggest challenge
Let’s dig deeper to the crux of the matter. What I think is the biggest challenge of all is that most people start with zero on 1st of January.
If you are a salesperson, you start with zero order until you close the first case. Last year’s production is considered done and it is counted for last year’s, not this year’s production. If you are an employee, your performance is reset whenever your boss is replaced. Your pay is of course starting from zero every day since you are paid as long as you work for your employer. If you are in those kind of business that relies on new sales every day, you basically start from zero at the beginning of the year.
So to make more money this year, you got to repeat the effort you put in last year, and plus some more effort to secure an income increment. I can say most of the people who are earning an active income are facing this problem. To make more money this year, you have no choice but to work even harder, if not smarter this year compared to the years before.
Not to start with ZERO
What can you do about this? In fact, there are some important elements that when done right, you don’t have to start with zero every year. I’ll give some examples of how this concept work.
First example, I subscribe to some services that I use on a regular basis on my business. These include the mailing list application which I pay several hundred ringgits a month, the website hosting service which I pay a few thousands ringgits a year, and the several magazine and membership subscription I renew regularly. These service providers I just mentioned don’t start with zero sales. They have a ready subscribed customers who will continue to use their service as long as the service is good and updated.
Another example is the unit trust consultant. These consultants not just get paid when clients deposit new fund to invest. They are also paid a certain fee on the asset under their management. So they starts with a basic amount of pay. The effort they put in this new year is going to contribute to the bottom line, increasing their commission paid on the total fund under their management.
Take a look at the household items at your home. Do you subscribe to Internet, Astro, water filtering system? More and more businesses are moving into providing subscription based service or products. This is how they can scale bigger and take in more business on top of the existing subscribers.
Start with a base
The whole picture is different when you start with a base. So the effort you put in these year to grow your income will be built on top of your last year’s revenue. If you structure your career or business this way, you will have the luxury of having more time to commit to your other non-money-related resolutions. You’ll have more time to improve your relationship, your health, your look and ultimately your happiness.
It is important to increase your income every year, so that your other non-money related resolutions can be met too. So that’s why I said that the biggest challenge to increase your income this year is the reality that you start with zero on 1st of January.
Now, I want you to think hard about how you make money. How your business is structured? How your career is allowing you to leverage on what you’ve done on previous year? What is important to do this year that will still have an impact next year and the future? If you can arrange your business model in such a way that you start with a subscribed clients, repeat customers, renewal income etc. Congratulation.
courtesy KCL.
Think about it. If you are in the sales department, or a business owner or a self-employed salesperson, the very first goal you would set for the year is how much increment you want on the sales revenue.
If you are under employment, your boss will give you a new set of higher key performance indicator (KPI). You would probably commit to perform better and try to get a raise, if not a promotion on the coming round of performance review. Most likely, most new year resolution has something to do with money and earning more income.
Setting a Higher Goal
When it comes to personal financial matter, I normally urge people to set a higher target of savings and investments. It is easier to achieve if you can make a higher income this year compared to last year. Of course, bigger goal comes with bigger challenges. I’ll talk about the biggest challenge of all in this article. Just a hint – it is not about the lack of discipline, lack of strategies, lack of time…You can make a guess now but keep on reading.
What’s your New Year Resolution?
Okay, enough about money. What about other types of resolutions you set for the new year? If you want a better relationship with your family, you might commit to spend extra time with your kids, or date your spouse more, like at least once in a week. When you spend that extra time with your kid, you want to really get into their world, and not just letting your son to play on the iPad while you watch the latest TV shows.
If you have a new year resolution to have a healthier body, you might have committed to eat more vegetables and cut down your fat intake. You might subscribed to a gym in order to work out more frequently. Extra effort needed if you really want to look good and young.
Some people also have a resolution to travel to certain places. For example, I have a friend who blocks out the vacation dates on his calendar. He knows exactly where he will be visiting for the whole year. Air tickets are booked early and he will simply reject all other events including wedding invitation that falls within his vacation period.
All these different resolution is believed to be able to contribute to your overall happiness. More or less, each one of those commitment is going to make your life better. Assuming that you successfully make it all, you are supposed to live happier, healthier and wealthier at the end of the year.
Making a new year’s resolution is easy. The big problem now is how to do it all. All these stuff require not just money, but also a lot of your time commitment and effort. These two resources is what majority of us lack of.
For example, if you spend more time to make money, you are left with not much time to spend on building a better relationship. You don’t have much energy to exercise and build a healthier body. Under stressful working environment, some people even tends to eat more just to relieve the pressure.
Here is the biggest challenge
Let’s dig deeper to the crux of the matter. What I think is the biggest challenge of all is that most people start with zero on 1st of January.
If you are a salesperson, you start with zero order until you close the first case. Last year’s production is considered done and it is counted for last year’s, not this year’s production. If you are an employee, your performance is reset whenever your boss is replaced. Your pay is of course starting from zero every day since you are paid as long as you work for your employer. If you are in those kind of business that relies on new sales every day, you basically start from zero at the beginning of the year.
So to make more money this year, you got to repeat the effort you put in last year, and plus some more effort to secure an income increment. I can say most of the people who are earning an active income are facing this problem. To make more money this year, you have no choice but to work even harder, if not smarter this year compared to the years before.
Not to start with ZERO
What can you do about this? In fact, there are some important elements that when done right, you don’t have to start with zero every year. I’ll give some examples of how this concept work.
First example, I subscribe to some services that I use on a regular basis on my business. These include the mailing list application which I pay several hundred ringgits a month, the website hosting service which I pay a few thousands ringgits a year, and the several magazine and membership subscription I renew regularly. These service providers I just mentioned don’t start with zero sales. They have a ready subscribed customers who will continue to use their service as long as the service is good and updated.
Another example is the unit trust consultant. These consultants not just get paid when clients deposit new fund to invest. They are also paid a certain fee on the asset under their management. So they starts with a basic amount of pay. The effort they put in this new year is going to contribute to the bottom line, increasing their commission paid on the total fund under their management.
Take a look at the household items at your home. Do you subscribe to Internet, Astro, water filtering system? More and more businesses are moving into providing subscription based service or products. This is how they can scale bigger and take in more business on top of the existing subscribers.
Start with a base
The whole picture is different when you start with a base. So the effort you put in these year to grow your income will be built on top of your last year’s revenue. If you structure your career or business this way, you will have the luxury of having more time to commit to your other non-money-related resolutions. You’ll have more time to improve your relationship, your health, your look and ultimately your happiness.
It is important to increase your income every year, so that your other non-money related resolutions can be met too. So that’s why I said that the biggest challenge to increase your income this year is the reality that you start with zero on 1st of January.
Now, I want you to think hard about how you make money. How your business is structured? How your career is allowing you to leverage on what you’ve done on previous year? What is important to do this year that will still have an impact next year and the future? If you can arrange your business model in such a way that you start with a subscribed clients, repeat customers, renewal income etc. Congratulation.
courtesy KCL.
Tuesday, June 18, 2013
Shopping Online 101
Frugal fashionistas of the world, unite! If you care about the embossed exterior of your Coach purse as much as the money nestled in it (and you should!), this guide to online shopping is for you. Think of the wonderful world of online shopping as a shopper’s paradise, where the clothes you covet are artfully arranged in pixels. Everything is housed in a colossal mall with no physical barriers; there are no shopping hours, no overzealous sales assistants, and no noisy (or nosy) shoppers. Your shopping experience is entirely sedentary, conducted while you sip on green tea and ponder over life’s imponderables. With a few clicks of your mouse, a new page is opened up and a row of baju karungs springs to pixelated life. You feel that familiar tug. Should I buy, should I wait? What if it doesn’t fit? Is that pink really as bright as it looks? Can I trust this merchant? It’s so expensive, will I get a refund if there are defects?
Need answers? Read on to discover the safe and budget-friendly way to shop online!
Why Shop Online?
That’s the most pertinent question to ask before you begin your shopping odyssey. Online shopaholics can no doubt attest to the sheer existential joy of shopping online (“With every virtual swipe of my card, it’s like I affirm my existence!”), but for those of you who are undecided, we’ll take you through the list of whys we’ve compiled.
Convenience
Simply put, it’s convenient! All you need to shop online is an internet connection and the means to transfer money electronically. Instead of setting aside an afternoon to wander around Mid Valley, you can cut down on petrol and parking costs by simply clicking “add to cart”.
Diversity
Shopping online affords consumers more variety. In a brick-and-mortar store, there’s only so much shelf space available to showcase the latest stock. In the virtual world, there are no such spatial constraints. The merchant can sell all available stock online. Importantly, smaller businesses that can’t afford the rental payments of a physical store can easily set up a virtual shop. This translates to an endless variety of apparel to choose from!
Price Comparison
You can quickly and conveniently compare prices online. Instead of driving or walking to different stores to compare prices, online accessibility allows for swift comparison. If you want to know whether Forever 21 is selling that peplum skirt for the best price on the market, you can either Google it or go to the websites of rival competitors. This is recommended, of course, and is a no-fuss way to budget and bargain-hunt.
Customer Feedback
If you want to know the reliability of a merchant or seller, you can go to consumer review sites to find out. This is informed shopping at its best, given the vast forum for consumer criticism/critique the Internet provides. Unlike shopping at a brick-and-mortar store, shopping online reduces the difference between a knowledgeable and not-as-informed consumer to (literally) a mouse-click. In order to get the best bang for your buck, always ensure that you read customer reviews to find out about product quality and merchant trustworthiness.
Low Cost
Now this is a contentious point, because shopping online can sometimes cost you more than going for a warehouse sale in Puchong. On the other hand, Internet retailers (especially blogshops) can offer far cheaper prices than a Bangsar boutique (they have to pay rental fees, etc., which are then factored into the retail price). In order to encourage shopping online, some established chain stores also offer more discounts for goods purchased over the Internet.
Is it Safe?
Similar to merrily making your way around a shopping mall, buying clothes online can be a perilous process. As in the real world, security and trust issues figure prominently. There are, however, several steps that you can take to minimise the risks involved, outlined and explained below. Always remember that your safety and security are paramount. After all, you’re giving your personal information, including shipping address and credit card details (where applicable), to a faceless stranger(s). Proceed with caution and trust your shopper’s instincts!
Use Credit Cards Equipped for Shopping Online
Whenever possible, use credit cards equipped for shopping online: they offer added protection against fraud or theft. For instance, RHB allows its credit card users to register their cards with 3D Secure, which uses MasterCard SecureCode and Verified by VISA to ensure the security and safety of internet transactions. Similarly, Maybank offers Maybankard Secure Online Shopping (MSOS), a feature which provides an extra layer of security online when you use your American Express, MasterCard, or VISA cards.
Shop with Retailers or Blogshops That Use Secure Payment Gateways
Payment gateways are the online equivalent of a physical Point of Sale (i.e. checkout counter where the financial transaction between customer and retailer is conducted). In order to accept credit cards from customers (or really any number of online payment options), Internet merchants use payment gateways. iPay88 is arguably the most used and secure payment gateway in Malaysia. It is supervised by Bank Negara Malaysia, regulated under Malaysia’s Payment Systems Act (2003), and is PCI DSS (Payment Card Industry Data Security Standard) compliant. The more secure and regulated the payment gateway, the more protected your financial details are during transactions and under the law. Online merchants often state on their website what payment gateway they use; if you are uncertain, never hesitate to ask the retailer.
Use Third-Party Payment Services
Using a third-party payment service is one of the safest ways to shop. The most popular third-party payment service is PayPal , which also allows merchants to use it as a payment gateway. To use PayPal to pay for online purchases, you must first sign-up for a PayPal account. PayPal acts as an intermediary between you and the Internet merchant, ensuring that they will never see your credit card details or bank information. Money is simply transferred from your PayPal account to the merchant’s PayPal account. Provided you remain a buyer and not a seller, PayPal is a free service, since transaction fees are charged to the sellers. However, while PayPal enjoys a commendable security record, remember that your PayPal account is linked to either your credit card or bank account, so PayPal does have your financial information.
Look Out for Security Seals, Privacy Policies, and SSL
Another way to ensure your safety online is to keep an eye out for safety and security seals on websites. These are small, logo-like badges located on the top, bottom, or corner of the retailer’s website (e.g. Norton Secured, PCI DSS approved, Positive SSL, VeriSign Secured, etc.). These seals are a good indication that the merchant abides by security standards and has a degree of accountability to you. Privacy policies (the more detailed the better) are also another good indicator of merchant trustworthiness; be sure to always read them before you make a purchase. Also look out for whether a website is SSL-enabled. SSL (Secure Socket layer) is a security protocol which is used to protect valuable data transmitted to and from a website. While some sites declare that they are SSL-enabled, you can always check yourself by looking at your browser address bar. You can check for https:// (the extra ‘s’ is for secure), a padlock beside the website address, or if any part of the address bar turns green. Before you enter any personal and financial data into a webpage, always ensure that either one of the three is present.
Don’t Get Phished
Phishing is an online crime that is unfortunately quite rampant these days. ‘Phishermen’ bait victims by sending out e-mails that appear as though they’re from a credit card company or bank you have dealings with. The e-mails may urge you to update your personal information – passwords or financial details – or re-direct you to a fake website (it appears legitimate) to log in. Once they have your credit card numbers and personal information, they can of course use them for fraudulent purposes. To stay safe, don’t send your bank account details or credit card numbers through e-mail. Log in to bank websites by keying in the website address on your browser’s address bar.
How to Save
The truly stylish never break the bank to maintain their look, so you shouldn’t have to either! After all, if there’s no moolah in the bank, it’s either debtors’ prison or stop shopping altogether. Now those aren’t fashionable alternatives, but don’t fret, we’ve put together several tips to shop in SaveMoney fashion!
Use Credit and Debit Card Promotions
The first tip is to make full use of online shopping promotions for your credit or debit card(s). For instance, RHB Now has a promotion where every month the first 200 customers who spend a minimum of RM150 (with participating online merchants) get RM50 cash back. Apart from cash back, there are also other exclusive deals available with merchants selected by your bank(s). So if you frequent ZALORA daily, there could be discounts on items if you use a particular credit card. Thus we suggest, devoted shoppers, that you monitor the promotions section on your bank’s website.
Use Vouchers and Coupons
Your favourite online retailer is bound to offer vouchers and coupons every now and again, especially to encourage new shoppers to buy. There are also vouchers for signing-up and subscribing to newsletters, so be sure to make use of those too.
Click Facebook ‘Like’
In order to promote their facebook pages and increase their popularity, online retailers and blogshops often give out vouchers to customers who ‘like’ their pages. Hardcore Facebooker or not, these deals are too easy to pass up, so hit “like” and don’t miss out!
Compare, Compare, Compare!
Even though it can get tedious, the savvy shopper always compares prices before she commits. Although that kimono top with the gosselin-thin butterfly sleeves screams at you to buy it, SaveMoney heads must prevail before clicking “add to cart”. Check with other online stores and even brick-and-mortar stores. Visit forums like lowyat.net to check and compare different prices for items you want. This is a good place to keep abreast of the latest discounts and promotions, along with any customer feedback other users leave. More importantly, bond with your fellow shopaholics shoppers and swap priceless info. You could even start your own Online Shopping Consumers group and demand more discounts! (“Give us discounts, promotions, deals, or death!”)
Save on Delivery
Save on shipping costs by buying from merchants who offer free delivery. Sometimes there is a minimum amount you have to spend, though, so don’t deviate from your budget just to receive free delivery! Be aware that online merchants can use free delivery as a marketing ploy, since they could already have included the shipping cost into the item price.
Loyalty Programs
Sign up for loyalty programs with online retailers you buy from often. You can get store credit for items you purchase, which can then be deducted from the total amount of your next order. Sometimes stores may even offer cash rebates, although this is relatively rare.
Refund or Return Policy
Before you buy, read the online retailer’s policy on refunds and returns. Some are generous and allow exchanges within a certain period (usually a week or 30 days). In our experience, cash refunds are pretty uncommon, with merchants preferring to reimburse you with store credit instead. Items must always be returned in mint condition, so take care to do so.
Need answers? Read on to discover the safe and budget-friendly way to shop online!
Why Shop Online?
That’s the most pertinent question to ask before you begin your shopping odyssey. Online shopaholics can no doubt attest to the sheer existential joy of shopping online (“With every virtual swipe of my card, it’s like I affirm my existence!”), but for those of you who are undecided, we’ll take you through the list of whys we’ve compiled.
Convenience
Simply put, it’s convenient! All you need to shop online is an internet connection and the means to transfer money electronically. Instead of setting aside an afternoon to wander around Mid Valley, you can cut down on petrol and parking costs by simply clicking “add to cart”.
Diversity
Shopping online affords consumers more variety. In a brick-and-mortar store, there’s only so much shelf space available to showcase the latest stock. In the virtual world, there are no such spatial constraints. The merchant can sell all available stock online. Importantly, smaller businesses that can’t afford the rental payments of a physical store can easily set up a virtual shop. This translates to an endless variety of apparel to choose from!
Price Comparison
You can quickly and conveniently compare prices online. Instead of driving or walking to different stores to compare prices, online accessibility allows for swift comparison. If you want to know whether Forever 21 is selling that peplum skirt for the best price on the market, you can either Google it or go to the websites of rival competitors. This is recommended, of course, and is a no-fuss way to budget and bargain-hunt.
Customer Feedback
If you want to know the reliability of a merchant or seller, you can go to consumer review sites to find out. This is informed shopping at its best, given the vast forum for consumer criticism/critique the Internet provides. Unlike shopping at a brick-and-mortar store, shopping online reduces the difference between a knowledgeable and not-as-informed consumer to (literally) a mouse-click. In order to get the best bang for your buck, always ensure that you read customer reviews to find out about product quality and merchant trustworthiness.
Low Cost
Now this is a contentious point, because shopping online can sometimes cost you more than going for a warehouse sale in Puchong. On the other hand, Internet retailers (especially blogshops) can offer far cheaper prices than a Bangsar boutique (they have to pay rental fees, etc., which are then factored into the retail price). In order to encourage shopping online, some established chain stores also offer more discounts for goods purchased over the Internet.
Is it Safe?
Similar to merrily making your way around a shopping mall, buying clothes online can be a perilous process. As in the real world, security and trust issues figure prominently. There are, however, several steps that you can take to minimise the risks involved, outlined and explained below. Always remember that your safety and security are paramount. After all, you’re giving your personal information, including shipping address and credit card details (where applicable), to a faceless stranger(s). Proceed with caution and trust your shopper’s instincts!
Use Credit Cards Equipped for Shopping Online
Whenever possible, use credit cards equipped for shopping online: they offer added protection against fraud or theft. For instance, RHB allows its credit card users to register their cards with 3D Secure, which uses MasterCard SecureCode and Verified by VISA to ensure the security and safety of internet transactions. Similarly, Maybank offers Maybankard Secure Online Shopping (MSOS), a feature which provides an extra layer of security online when you use your American Express, MasterCard, or VISA cards.
Shop with Retailers or Blogshops That Use Secure Payment Gateways
Payment gateways are the online equivalent of a physical Point of Sale (i.e. checkout counter where the financial transaction between customer and retailer is conducted). In order to accept credit cards from customers (or really any number of online payment options), Internet merchants use payment gateways. iPay88 is arguably the most used and secure payment gateway in Malaysia. It is supervised by Bank Negara Malaysia, regulated under Malaysia’s Payment Systems Act (2003), and is PCI DSS (Payment Card Industry Data Security Standard) compliant. The more secure and regulated the payment gateway, the more protected your financial details are during transactions and under the law. Online merchants often state on their website what payment gateway they use; if you are uncertain, never hesitate to ask the retailer.
Use Third-Party Payment Services
Using a third-party payment service is one of the safest ways to shop. The most popular third-party payment service is PayPal , which also allows merchants to use it as a payment gateway. To use PayPal to pay for online purchases, you must first sign-up for a PayPal account. PayPal acts as an intermediary between you and the Internet merchant, ensuring that they will never see your credit card details or bank information. Money is simply transferred from your PayPal account to the merchant’s PayPal account. Provided you remain a buyer and not a seller, PayPal is a free service, since transaction fees are charged to the sellers. However, while PayPal enjoys a commendable security record, remember that your PayPal account is linked to either your credit card or bank account, so PayPal does have your financial information.
Look Out for Security Seals, Privacy Policies, and SSL
Another way to ensure your safety online is to keep an eye out for safety and security seals on websites. These are small, logo-like badges located on the top, bottom, or corner of the retailer’s website (e.g. Norton Secured, PCI DSS approved, Positive SSL, VeriSign Secured, etc.). These seals are a good indication that the merchant abides by security standards and has a degree of accountability to you. Privacy policies (the more detailed the better) are also another good indicator of merchant trustworthiness; be sure to always read them before you make a purchase. Also look out for whether a website is SSL-enabled. SSL (Secure Socket layer) is a security protocol which is used to protect valuable data transmitted to and from a website. While some sites declare that they are SSL-enabled, you can always check yourself by looking at your browser address bar. You can check for https:// (the extra ‘s’ is for secure), a padlock beside the website address, or if any part of the address bar turns green. Before you enter any personal and financial data into a webpage, always ensure that either one of the three is present.
Don’t Get Phished
Phishing is an online crime that is unfortunately quite rampant these days. ‘Phishermen’ bait victims by sending out e-mails that appear as though they’re from a credit card company or bank you have dealings with. The e-mails may urge you to update your personal information – passwords or financial details – or re-direct you to a fake website (it appears legitimate) to log in. Once they have your credit card numbers and personal information, they can of course use them for fraudulent purposes. To stay safe, don’t send your bank account details or credit card numbers through e-mail. Log in to bank websites by keying in the website address on your browser’s address bar.
How to Save
The truly stylish never break the bank to maintain their look, so you shouldn’t have to either! After all, if there’s no moolah in the bank, it’s either debtors’ prison or stop shopping altogether. Now those aren’t fashionable alternatives, but don’t fret, we’ve put together several tips to shop in SaveMoney fashion!
Use Credit and Debit Card Promotions
The first tip is to make full use of online shopping promotions for your credit or debit card(s). For instance, RHB Now has a promotion where every month the first 200 customers who spend a minimum of RM150 (with participating online merchants) get RM50 cash back. Apart from cash back, there are also other exclusive deals available with merchants selected by your bank(s). So if you frequent ZALORA daily, there could be discounts on items if you use a particular credit card. Thus we suggest, devoted shoppers, that you monitor the promotions section on your bank’s website.
Use Vouchers and Coupons
Your favourite online retailer is bound to offer vouchers and coupons every now and again, especially to encourage new shoppers to buy. There are also vouchers for signing-up and subscribing to newsletters, so be sure to make use of those too.
Click Facebook ‘Like’
In order to promote their facebook pages and increase their popularity, online retailers and blogshops often give out vouchers to customers who ‘like’ their pages. Hardcore Facebooker or not, these deals are too easy to pass up, so hit “like” and don’t miss out!
Compare, Compare, Compare!
Even though it can get tedious, the savvy shopper always compares prices before she commits. Although that kimono top with the gosselin-thin butterfly sleeves screams at you to buy it, SaveMoney heads must prevail before clicking “add to cart”. Check with other online stores and even brick-and-mortar stores. Visit forums like lowyat.net to check and compare different prices for items you want. This is a good place to keep abreast of the latest discounts and promotions, along with any customer feedback other users leave. More importantly, bond with your fellow shopaholics shoppers and swap priceless info. You could even start your own Online Shopping Consumers group and demand more discounts! (“Give us discounts, promotions, deals, or death!”)
Save on Delivery
Save on shipping costs by buying from merchants who offer free delivery. Sometimes there is a minimum amount you have to spend, though, so don’t deviate from your budget just to receive free delivery! Be aware that online merchants can use free delivery as a marketing ploy, since they could already have included the shipping cost into the item price.
Loyalty Programs
Sign up for loyalty programs with online retailers you buy from often. You can get store credit for items you purchase, which can then be deducted from the total amount of your next order. Sometimes stores may even offer cash rebates, although this is relatively rare.
Refund or Return Policy
Before you buy, read the online retailer’s policy on refunds and returns. Some are generous and allow exchanges within a certain period (usually a week or 30 days). In our experience, cash refunds are pretty uncommon, with merchants preferring to reimburse you with store credit instead. Items must always be returned in mint condition, so take care to do so.
4 of Dad's Best Money Tips
This month we’re celebrating dads and all they do for us. They taught us how to throw a ball, they fixed the chain on our bicycle, and they imparted their wisdom – often it was wisdom that they got from their dads.
However, times have changed and maybe the advice they once gave us about money and credit and debt is no longer 100% accurate. No disrespect intended (and we’ll ALWAYS assure dad that he was totally right) but in this article I want to update some classic money tips from Dad for the modern era.
Tip #1: Your reputation matters. Get to know the bank manager before you get a mortgage.
This might have worked 50 years ago, but it won’t now. Today, most financial institutions rely on credit scores to assess your creditworthiness. Dad would still be proud, though, if you kept a nice, respectable reputation anyway.
Tip #2: Don’t owe anyone anything.
There was a time when you could save up your money and pay cash for a house or car, but today it’s almost necessary for anyone living in America to get a loan of some kind at some point in their life. Besides, having a couple of credit accounts (on which you make your payments in full and on time) is a great way to help you achieve a healthier credit score. Sorry, Dad; owing someone can actually be a good thing.
Tip #3: Pay cash for everything.
Paying cash for everything was Dad’s advice to ensure that we didn’t get a credit card and then fund a wild, high-roller trip to Vegas with 10 of our closest friends. But the careful use of credit cards can help your credit score by demonstrating your responsible use of credit and building a good credit history.
Dad was partly right – you shouldn’t buy anything you can’t afford. But that is very different from paying cash for everything. Smart credit users make purchases on their credit knowing that they have the money available to pay it off. And even if you could afford that trip to Vegas, Dad would probably not approve.
Tip #4: Get a college education, then get a good job.
For the most part, this is pretty good advice. But it’s no longer complete. In Dad’s day, a college education pretty much guaranteed a “good job” upon graduation and you stuck at that job until you retired. Today, a college education is just the beginning. And with record-high unemployment, you need a lot more to get and keep that job.
A good credit history is one of the ways you can get an edge, since some employers are pulling credit reports to help them evaluate job candidates. Keeping an eye on your credit can help you keep on top of things.
This month, we think of our dads and all that they’ve done for us. And dads do a lot, but we need to update their advice for the modern age.
Happy Fathers Day, Dad!
However, times have changed and maybe the advice they once gave us about money and credit and debt is no longer 100% accurate. No disrespect intended (and we’ll ALWAYS assure dad that he was totally right) but in this article I want to update some classic money tips from Dad for the modern era.
Tip #1: Your reputation matters. Get to know the bank manager before you get a mortgage.
This might have worked 50 years ago, but it won’t now. Today, most financial institutions rely on credit scores to assess your creditworthiness. Dad would still be proud, though, if you kept a nice, respectable reputation anyway.
Tip #2: Don’t owe anyone anything.
There was a time when you could save up your money and pay cash for a house or car, but today it’s almost necessary for anyone living in America to get a loan of some kind at some point in their life. Besides, having a couple of credit accounts (on which you make your payments in full and on time) is a great way to help you achieve a healthier credit score. Sorry, Dad; owing someone can actually be a good thing.
Tip #3: Pay cash for everything.
Paying cash for everything was Dad’s advice to ensure that we didn’t get a credit card and then fund a wild, high-roller trip to Vegas with 10 of our closest friends. But the careful use of credit cards can help your credit score by demonstrating your responsible use of credit and building a good credit history.
Dad was partly right – you shouldn’t buy anything you can’t afford. But that is very different from paying cash for everything. Smart credit users make purchases on their credit knowing that they have the money available to pay it off. And even if you could afford that trip to Vegas, Dad would probably not approve.
Tip #4: Get a college education, then get a good job.
For the most part, this is pretty good advice. But it’s no longer complete. In Dad’s day, a college education pretty much guaranteed a “good job” upon graduation and you stuck at that job until you retired. Today, a college education is just the beginning. And with record-high unemployment, you need a lot more to get and keep that job.
A good credit history is one of the ways you can get an edge, since some employers are pulling credit reports to help them evaluate job candidates. Keeping an eye on your credit can help you keep on top of things.
This month, we think of our dads and all that they’ve done for us. And dads do a lot, but we need to update their advice for the modern age.
Happy Fathers Day, Dad!
Monday, June 17, 2013
How to Prioritize Your Budget
Tracking expenses and placing limits on your spending are basic financial rules that can benefit everyone, and yet many Americans still don’t make a budget. But it’s time for them to start — a budget forces you to prioritize, make better decisions and keeps you on track.
When it comes to a monthly budget, no one size fits all. That’s why it’s important to identify what expenses are most important to you and base your budget around your own priorities. Follow these tips for prioritizing a budget that will help you more easily achieve your financial goals.
Determine essential expenses.
The first step in creating any good budget is to figure out what is a non-negotiable expense. For example, unless you’re fortunate enough to be living somewhere rent-free, you probably have to make either a rent or mortgage payment each month. If that’s the case, then you may also have to pay utilities. These are non-negotiable expenses, meaning you have to pay them and they’re not going away anytime soon. Other expenses in this category? Your wireless bill, perhaps medical expenses, and loan payments. You can also choose to put things like gas and groceries in this category, if that makes sense for you. Or, you can do it this way: Add up all of the necessary expenses and subtract the total from your monthly income. The difference is what you have leftover to put toward everything else, such as groceries, gas, a gym membership, entertainment, shopping and dining out.
Plan to minimize debt.
Consumers in the United States have collectively racked up $82 billion in new credit card debt over the last two years alone, according to a 2012 study by credit card comparison and resource site CardHub.com. The biggest cause of it is habitual overspending, says John Kiernan, CardHub editor and senior analyst. Paying down your debts should be a top priority when determining your budget, and your payments should go right up there with your other non-negotiable expenses. The best way to pay off amounts owed, Kiernan says, is to strategically eliminate the balances with the highest interest rates first. Once those are paid off, repeat with the next most expensive balance, and so on. Whatever you do, always continue to at least make the minimum payments (on time), and pay even more if you can.
Another important aspect of getting out of debt is to stop accruing more, Wahl said. “Be vigilant about not taking out new credit cards or loans unless it is going to help you achieve your goal of paying down your debt,” Wahl said.
Remember that paying you’re your debts is a process, so don’t overthink it. “People often react to debt like deer in headlights,” Kiernan said. “We get paralyzed thinking about all of the potential ramifications and don’t take action. But we also can’t lose sight of the fact that debt reduction is a process. It takes time, diligence, and sacrifice. In short, having the right mindset pays off when it comes to getting out of debt.”
Identify your savings goals.
What are you saving for? Figure it out and then incorporate it into your budget. For starters, you should always have an emergency fund, which is a savings account that you don’t touch unless you absolutely need it. Putting even just a small amount away each month will be extremely useful in emergencies down the road. The idea is that you have the money and hope you never have to use it.
Next, think about what you want to save for long term. A child’s college fund? A house that you’ll buy in 10 years? Think about how much you’ll need and when, divide it by the number of years you’ll be saving it, divide that by 12, and that’s how much you need to save each month. (Example: If you want to save $60,000 for a down payment on a house, and you’re saving for 10 years, the formula is: $60,000 / 10 = $6,000 / 12 = $500 / month)
Finally, think about your short-term savings goals. Maybe it’s a vacation in the next six months, or a new car in the next year. Use the same formula as above to figure out how much you need to put away and how frequently.
Give yourself some space to mess up.
Though it may be hard to accept, no one is perfect. You’re going to make mistakes, and every once in a while, you’re going to overspend or stray from your budget just a bit. When creating your budget, give yourself enough wiggle room so that in the rare event that you do go over, you won’t be really hurting yourself financially.
from: yahoo.finance.
Sunday, August 12, 2012
23 Tips to Save on Clothing
On average, we spend $1,700 a year on clothes. Here's how to reduce that number and still look good.
1. Sell what you don’t wear
If you don’t wear it, drop it off at a consignment shop. When the shop sells your clothing, they’ll cut you a check for a portion of the profits. You won’t get the full amount, but you won’t have to do much work either. Stacy recommends going through your closet once a year. If you haven’t worn that sweater in 365 days, you don’t need it.
2. Shop thrift stores
In the video, Stacy found a pair of Lucky brand jeans for $12.99. Thrift stores sell gently used clothing at a deep discount. Many stores also have regular sales or a weekly special. A thrift store in my area has a “50 percent off anything with a yellow tag” sale every Wednesday. Just make sure you’re shopping at a true thrift store and not a vintage clothing store. The difference: Vintage clothing stores sell trendier older pieces at a markup. Thrift stores sell older and newer clothes at a discount.
3. Find coupons online
At Money Talks News, we don’t believe in paying retail, and you shouldn’t either. (Check out our deals page before you shop online or in-store.) On the go, use your smartphone to find clothing coupons before you check out. There are several great coupon locating apps for Androids and the iPhone. My favorites:
Coupon Closet
Coupon Sherpa
Shooger
4. Check the tag before you buy
Read the label before you buy. If you buy a dry-clean-only silk skirt, you’ll keep paying for it every time you pull up to the cleaners. Stick to machine-washables and save.
5. Take care of your clothes
Remember that “machine-washable” doesn’t equal “indestructible.” Wash your clothes on the gentle cycle in cool water and even line-dry them – they’ll last the longest this way. For delicate items or clothes that might shrink, hand wash. Take care of your clothes and you’ll get years of use out of them.
6. Buy out of season
Retailers put out-of-season clothing on clearance to clear the stock from their stores. You can save a ton buying clothing when you don’t need it – like a coat in May or a swimsuit in December.
7. Shop online clearance sales
Don’t discount online retailers (and retailers’ websites) when you’re shopping for clothes. They follow seasons too with huge discounts – and a larger selection than most stores – on clearance items.
8. Repurpose old clothes
If you’re handy with a needle and thread – or even a pair of scissors – turn something you’re no longer wearing into something else. I cut the legs off my old jeans and turn them into shorts. My friends repurpose old shirts into tank tops and skirts. You can even make a purse out of an old sweater.
9. Don’t buy it because it’s on sale
Don’t buy clothes unless you really need them – even if they’re on sale. Thirty percent off isn’t a good deal if you don’t wear it 99 percent of the time.
10. Buy basics from generic brands
Your basics don’t need a designer label. Buy T-shirts, tank tops, and lounge wear from cheaper stores. I buy all my layering tank tops at Old Navy. My track pants I wear for errands came from Target. Simple cuts and solid colors don’t require a high-end designer.
11. Skip expensive workout clothing
Same goes for workout clothes. A pair of Puma running capris cost $55 – or you can buy them at Old Navy for $16.94. You’ll get the same workout whether you’re wearing a fancy yoga outfit or an old T-shirt and sweatpants. Check cheaper retailers like Target, Walmart, and Kohls for more affordable workout gear.
12. Proceed with caution at outlet malls
Outlet malls do have deals. They also have scams. In 5 Tips for Finding Outlet Store Deals, Brandon found that some outlet store clothing isn’t store overstock. The pieces were actually made for the outlet mall, meaning they’re lower quality. And those “75 percent off!” deals – they’re not actually 75 percent off. Read the fine print and you’ll see that is the discount on the suggested price, not the actual retail price. It’s more marketing gimmick than deal.
Check the labels on outlet store clothes. Avoid anything that says “factory line” and do the math on supposed deals before you buy.
http://www.moneytalksnews.com/2012/05/04/23-tips-for-saving-money-on-clothing
1. Sell what you don’t wear
If you don’t wear it, drop it off at a consignment shop. When the shop sells your clothing, they’ll cut you a check for a portion of the profits. You won’t get the full amount, but you won’t have to do much work either. Stacy recommends going through your closet once a year. If you haven’t worn that sweater in 365 days, you don’t need it.
2. Shop thrift stores
In the video, Stacy found a pair of Lucky brand jeans for $12.99. Thrift stores sell gently used clothing at a deep discount. Many stores also have regular sales or a weekly special. A thrift store in my area has a “50 percent off anything with a yellow tag” sale every Wednesday. Just make sure you’re shopping at a true thrift store and not a vintage clothing store. The difference: Vintage clothing stores sell trendier older pieces at a markup. Thrift stores sell older and newer clothes at a discount.
3. Find coupons online
At Money Talks News, we don’t believe in paying retail, and you shouldn’t either. (Check out our deals page before you shop online or in-store.) On the go, use your smartphone to find clothing coupons before you check out. There are several great coupon locating apps for Androids and the iPhone. My favorites:
Coupon Closet
Coupon Sherpa
Shooger
4. Check the tag before you buy
Read the label before you buy. If you buy a dry-clean-only silk skirt, you’ll keep paying for it every time you pull up to the cleaners. Stick to machine-washables and save.
5. Take care of your clothes
Remember that “machine-washable” doesn’t equal “indestructible.” Wash your clothes on the gentle cycle in cool water and even line-dry them – they’ll last the longest this way. For delicate items or clothes that might shrink, hand wash. Take care of your clothes and you’ll get years of use out of them.
6. Buy out of season
Retailers put out-of-season clothing on clearance to clear the stock from their stores. You can save a ton buying clothing when you don’t need it – like a coat in May or a swimsuit in December.
7. Shop online clearance sales
Don’t discount online retailers (and retailers’ websites) when you’re shopping for clothes. They follow seasons too with huge discounts – and a larger selection than most stores – on clearance items.
8. Repurpose old clothes
If you’re handy with a needle and thread – or even a pair of scissors – turn something you’re no longer wearing into something else. I cut the legs off my old jeans and turn them into shorts. My friends repurpose old shirts into tank tops and skirts. You can even make a purse out of an old sweater.
9. Don’t buy it because it’s on sale
Don’t buy clothes unless you really need them – even if they’re on sale. Thirty percent off isn’t a good deal if you don’t wear it 99 percent of the time.
10. Buy basics from generic brands
Your basics don’t need a designer label. Buy T-shirts, tank tops, and lounge wear from cheaper stores. I buy all my layering tank tops at Old Navy. My track pants I wear for errands came from Target. Simple cuts and solid colors don’t require a high-end designer.
11. Skip expensive workout clothing
Same goes for workout clothes. A pair of Puma running capris cost $55 – or you can buy them at Old Navy for $16.94. You’ll get the same workout whether you’re wearing a fancy yoga outfit or an old T-shirt and sweatpants. Check cheaper retailers like Target, Walmart, and Kohls for more affordable workout gear.
12. Proceed with caution at outlet malls
Outlet malls do have deals. They also have scams. In 5 Tips for Finding Outlet Store Deals, Brandon found that some outlet store clothing isn’t store overstock. The pieces were actually made for the outlet mall, meaning they’re lower quality. And those “75 percent off!” deals – they’re not actually 75 percent off. Read the fine print and you’ll see that is the discount on the suggested price, not the actual retail price. It’s more marketing gimmick than deal.
Check the labels on outlet store clothes. Avoid anything that says “factory line” and do the math on supposed deals before you buy.
http://www.moneytalksnews.com/2012/05/04/23-tips-for-saving-money-on-clothing
25 Simple Ways to Save an Extra $1,000
Every year, I make New Year’s resolutions. And every year, I stick to them – for a few months. By July, I’ve often given up.
I’m not alone. “A full 35 percent of New Year’s resolutions are broken before the end of January of the successive year,” one survey revealed. If your resolution was to give up drinking or stop smoking, Money Talks News really can’t help you. But if it was to save more money, we’ve got you covered.
1. Cut your cell phone plan
Have you looked at your cell phone history lately? If you’re using less than your allotted minutes, text, or data, switch to a lower plan. Six months ago, I dropped my $89.99 unlimited plan for a $59.99 plan with 1,000 minutes – a savings of $30 a month and $180 so far. And I don’t miss the minutes. (I wasn’t using them anyway.) Comb through your history and bills, then ditch anything you’re not using.
2. Ditch the landline
Speaking of ditching things, it may be time to cut the landline. If you primarily use your cell phone, why keep two services that do the same thing? As Stacy said in the video, cutting your landline service can save $25 to $30 a month – around $300 a year.
3. Take a staycation
Two of my friends just took their summer vacations. One spent a week in Hawaii and spent close to $2,000 on airfare, hotels, and dining out. She thought she got a good deal – until my other friend bragged that he had taken a week-long staycation and only spent $500. He saw all the tourist stuff we never go to as locals and ate at local five-star restaurants every night for a week.
Staycations are all the rage lately for one reason: They’re a lot cheaper than regular vacations. If you’re trying to stash away an extra grand this year, consider staying home and living like a tourist in your own city for a few days.
4. Raise your deductibles
Raising your insurance deductibles will lower your monthly payment. For example, raise your car and homeowners insurance deductibles from $200 to $1,000 and you could save hundreds in premiums. Just make sure you don’t raise the deductible higher than you can afford if you need to file a claim.
5. Drop the gym membership
I vowed to do more cardio this year – but I’m not spending the $34.99 a month my neighborhood gym charges. Instead, I’m running at the local park and using some Tae Bo videos at home. Sure, I feel silly sometimes doing high kicks in my living room, but I’ve saved $209.94 so far this year by skipping the gym. And you can do the same. You really don’t need the fancy equipment, just a good pair of running shoes.
6. Turn off the premium channels
In our article You Don’t Have to Pay For Cable TV, we lay out exactly how you can ditch the cable altogether and still watch your favorite shows. But if you want to keep your cable, at least ditch the premium channels. HBO, Cinemax, and Showtime each cost about $13 a month or $39 for all three. If you cut them off today, in just six months you’ll be $234 richer.
7. Brown-bag it
A survey by staffing firm Accounting Principals found that more than 66 percent of workers spend around $2,000 a year on lunch. If you start brown-bagging it every day, you could easily cut that by 50 percent – and save $1,000 a year.
8. Cut out ATM fees
My old bank didn’t have nearby ATMs, and they charged a convenience fee when I used one outside of their network – so I spent about $5 for every ATM withdrawal. Going to the ATM once a week was costing me $20 a month. So I switched to a bank with more free ATMs in my area, saving $240 a year. If you’re paying for access to your own money, you should do the same.
9. Buy out of season
Buying out of season (swimsuits in January or Halloween decorations in November) can save you a ton of money. This year, Target put their heart-shaped Russell Stover’s boxes on clearance for 75 percent off a week after Valentine’s Day. I got four boxes (regularly priced $8.99) for $2.25 – a savings of $6.74 per box.
10. Sell what you’re not using
Want a painless way to beef up your savings? Go through your house and toss everything into a box that you haven’t used or worn this year. Then sell that stuff and put the money you make into savings. Check out our article 5 Best Websites for Turning Junk Into Cash, or go the old-fashioned route with a yard sale or a visit to a consignment shop.
11. Buy generic
Many products are the same, no matter the brand name. For example, in 7 Things You Should Always Buy Generic, we suggest skipping the name brands on pain relievers, water, milk, margarine, bleach, cleaning products, and spices. They all worked as well as their name brand counterparts, and we found savings up to 60 percent.
12. Use coupons
Vow to always use coupons, and not just on your groceries. With sites like Groupon and LivingSocial, you can snag deep discounts at local retailers. And if you’re shopping online, always do a quick search for a coupon code before you check out. Sites like RetailMeNot and SlickDeals post coupon codes and special offers daily. You can also check out our deals page.
13. Quit smoking
In my area, a pack of cigarettes costs about $4.75 (and that’s cheap). Smoke a pack a day and you’ll spend $144 a month. In a year, you’ll spend $1,733 on cigarettes. Quitting isn’t just good for your health, it’s good for your wallet. But if you’re not going to quit, at least save some money on the smokes you buy. Check out 6 Ways to Save on Cigarettes for ideas – like buying in cartons and shopping for your smokes on an Indian reservation.
14. Reduce your energy use
According to The White Fence Index, U.S. consumers spend an average of $96.55 a month and $1,158.60 a year on electricity. If you reduced your bill by 30 percent, you’d save $28.96 in a month and $347.58 a year.
That isn’t hard to do – just install a few CFL light bulbs, turn up (or, when it’s cold, down) your thermostat, and flip the switch when you leave the room.
15. Stop paying for pricey shipping
The other day, I got a warning from Mint telling me I spend a lot on shipping costs. I looked at my history, and they’re right: Last month, I spent more than $50 just in shipping, mostly because I had a hard drive overnighted to me for an extra $19.99.
I wasted almost $20 because I was impatient. Don’t do the same. Look for sites with free or discounted shipping and just wait the few extra days. If you ordered $19.99 overnight shipping once a month, you’d spend $239.88 a year on delivery fees.
16. Do it yourself
Hiring a pro is expensive, especially when you have the Internet to teach you how to do it yourself. In the past year, I’ve fixed a leaking faucet, replaced a shower head, repaired a door, and re-tiled my bathroom – all things I didn’t know how to do before I started. I watched home-improvement videos, taught myself, and saved the money. And you can too. Check out:
This Old House
bobvila
The Family Handyman
17. Comparison shop for beer
Between happy hour, game-day specials, and weekly ads, there are plenty of deals to keep you from paying full price for alcohol. For example, in 5 Tips to Save on Beer, Money Talks News found a website called SaveonBrew.com that posts discount deals on beer in your area.
18. Find free fun
No matter what you like to do, there’s probably a free or cheaper version. For example, I love live music, but even a cheap concert ticket can cost $45. If I go twice a month, that’s $1,080 a year. But my city hosts weekly free concerts downtown. The bands are usually local, but they’re good and free. Now I only buy tickets to the big-name bands once or twice a year, saving about $1,000.
19. Buy last-generation electronics
Buying the latest and greatest electronics isn’t always worth it. Electronics like smartphones are updated and released so frequently that the changes made from one year to the next can be barely noticeable to the average user. And soon as the new device comes out, the old device gets cheaper. So wait and buy year-old devices to save.
20. Haggle
I never used to haggle, not even at a garage sale, but then my sister scored a $100 discount on a new couch just by asking – and I was hooked. Ask for a discount before you buy anything, even at a major retailer. You could get a reduction in price just by asking.
21. Stop buying new books
I’ve been eying the new Charlaine Harris book, but Amazon wants $21.95 for a hardcover copy. I know there are plenty of ways to get a book free or dirt cheap, so I’m waiting. And you should too. Buying new books is costly, especially when you can get them for free at the public library or by using a book swapping service. Check out the 4 Best Sites for Trading in Old Books.
22. Buy used
I recently did a story called 20 Things You Shouldn’t Buy Used. And for those 20 things – like helmets, cribs, and mattresses – I stand by my statement: Don’t buy them used. But for everything else, you can save 50 percent or more by combing Craigslist, garage sales, and resale shops. Want some ideas on what you should buy used? Check out 14 Things You Should Always Buy Used.
23. Turn off the advertising
I rarely watch live TV, and I don’t subscribe to beauty magazines, so I don’t feel the pressure of advertising. But when I’m in the salon browsing through a magazine, I inevitably find half a dozen products I think I need right now. I wouldn’t have known those products even existed if I hadn’t opened that magazine. Start avoiding commercials and ads, and you’ll save a ton of money.
24. Use household products instead of commercial ones
The number of commercial products on the market is seemingly endless – especially cleaning and beauty products. You can spend a good chunk of your income buying special products designed to only do one job – or you can save that money and use something you already have around the house. Check out 19 Uses for Baking Soda, Dryer Sheets, and Beer for ideas – like using baking soda as a facial scrub, or cleaning your windows with vinegar.
25. Go meatless
One pound of 93 percent lean hamburger meat costs $6.95 in my local grocery store – and we go through about a pound in one meal at my house. To save my money and my health, I’ve stopped eating so much meat – especially red meat. I used to buy three of those packages per week, spending $20.85. Now I eat three meatless meals a week and save that money, which adds up to just more than $1,000 a year.
http://finance.yahoo.com/news/25-simple-ways-save-extra-055511855.html
I’m not alone. “A full 35 percent of New Year’s resolutions are broken before the end of January of the successive year,” one survey revealed. If your resolution was to give up drinking or stop smoking, Money Talks News really can’t help you. But if it was to save more money, we’ve got you covered.
1. Cut your cell phone plan
Have you looked at your cell phone history lately? If you’re using less than your allotted minutes, text, or data, switch to a lower plan. Six months ago, I dropped my $89.99 unlimited plan for a $59.99 plan with 1,000 minutes – a savings of $30 a month and $180 so far. And I don’t miss the minutes. (I wasn’t using them anyway.) Comb through your history and bills, then ditch anything you’re not using.
2. Ditch the landline
Speaking of ditching things, it may be time to cut the landline. If you primarily use your cell phone, why keep two services that do the same thing? As Stacy said in the video, cutting your landline service can save $25 to $30 a month – around $300 a year.
3. Take a staycation
Two of my friends just took their summer vacations. One spent a week in Hawaii and spent close to $2,000 on airfare, hotels, and dining out. She thought she got a good deal – until my other friend bragged that he had taken a week-long staycation and only spent $500. He saw all the tourist stuff we never go to as locals and ate at local five-star restaurants every night for a week.
Staycations are all the rage lately for one reason: They’re a lot cheaper than regular vacations. If you’re trying to stash away an extra grand this year, consider staying home and living like a tourist in your own city for a few days.
4. Raise your deductibles
Raising your insurance deductibles will lower your monthly payment. For example, raise your car and homeowners insurance deductibles from $200 to $1,000 and you could save hundreds in premiums. Just make sure you don’t raise the deductible higher than you can afford if you need to file a claim.
5. Drop the gym membership
I vowed to do more cardio this year – but I’m not spending the $34.99 a month my neighborhood gym charges. Instead, I’m running at the local park and using some Tae Bo videos at home. Sure, I feel silly sometimes doing high kicks in my living room, but I’ve saved $209.94 so far this year by skipping the gym. And you can do the same. You really don’t need the fancy equipment, just a good pair of running shoes.
6. Turn off the premium channels
In our article You Don’t Have to Pay For Cable TV, we lay out exactly how you can ditch the cable altogether and still watch your favorite shows. But if you want to keep your cable, at least ditch the premium channels. HBO, Cinemax, and Showtime each cost about $13 a month or $39 for all three. If you cut them off today, in just six months you’ll be $234 richer.
7. Brown-bag it
A survey by staffing firm Accounting Principals found that more than 66 percent of workers spend around $2,000 a year on lunch. If you start brown-bagging it every day, you could easily cut that by 50 percent – and save $1,000 a year.
8. Cut out ATM fees
My old bank didn’t have nearby ATMs, and they charged a convenience fee when I used one outside of their network – so I spent about $5 for every ATM withdrawal. Going to the ATM once a week was costing me $20 a month. So I switched to a bank with more free ATMs in my area, saving $240 a year. If you’re paying for access to your own money, you should do the same.
9. Buy out of season
Buying out of season (swimsuits in January or Halloween decorations in November) can save you a ton of money. This year, Target put their heart-shaped Russell Stover’s boxes on clearance for 75 percent off a week after Valentine’s Day. I got four boxes (regularly priced $8.99) for $2.25 – a savings of $6.74 per box.
10. Sell what you’re not using
Want a painless way to beef up your savings? Go through your house and toss everything into a box that you haven’t used or worn this year. Then sell that stuff and put the money you make into savings. Check out our article 5 Best Websites for Turning Junk Into Cash, or go the old-fashioned route with a yard sale or a visit to a consignment shop.
11. Buy generic
Many products are the same, no matter the brand name. For example, in 7 Things You Should Always Buy Generic, we suggest skipping the name brands on pain relievers, water, milk, margarine, bleach, cleaning products, and spices. They all worked as well as their name brand counterparts, and we found savings up to 60 percent.
12. Use coupons
Vow to always use coupons, and not just on your groceries. With sites like Groupon and LivingSocial, you can snag deep discounts at local retailers. And if you’re shopping online, always do a quick search for a coupon code before you check out. Sites like RetailMeNot and SlickDeals post coupon codes and special offers daily. You can also check out our deals page.
13. Quit smoking
In my area, a pack of cigarettes costs about $4.75 (and that’s cheap). Smoke a pack a day and you’ll spend $144 a month. In a year, you’ll spend $1,733 on cigarettes. Quitting isn’t just good for your health, it’s good for your wallet. But if you’re not going to quit, at least save some money on the smokes you buy. Check out 6 Ways to Save on Cigarettes for ideas – like buying in cartons and shopping for your smokes on an Indian reservation.
14. Reduce your energy use
According to The White Fence Index, U.S. consumers spend an average of $96.55 a month and $1,158.60 a year on electricity. If you reduced your bill by 30 percent, you’d save $28.96 in a month and $347.58 a year.
That isn’t hard to do – just install a few CFL light bulbs, turn up (or, when it’s cold, down) your thermostat, and flip the switch when you leave the room.
15. Stop paying for pricey shipping
The other day, I got a warning from Mint telling me I spend a lot on shipping costs. I looked at my history, and they’re right: Last month, I spent more than $50 just in shipping, mostly because I had a hard drive overnighted to me for an extra $19.99.
I wasted almost $20 because I was impatient. Don’t do the same. Look for sites with free or discounted shipping and just wait the few extra days. If you ordered $19.99 overnight shipping once a month, you’d spend $239.88 a year on delivery fees.
16. Do it yourself
Hiring a pro is expensive, especially when you have the Internet to teach you how to do it yourself. In the past year, I’ve fixed a leaking faucet, replaced a shower head, repaired a door, and re-tiled my bathroom – all things I didn’t know how to do before I started. I watched home-improvement videos, taught myself, and saved the money. And you can too. Check out:
This Old House
bobvila
The Family Handyman
17. Comparison shop for beer
Between happy hour, game-day specials, and weekly ads, there are plenty of deals to keep you from paying full price for alcohol. For example, in 5 Tips to Save on Beer, Money Talks News found a website called SaveonBrew.com that posts discount deals on beer in your area.
18. Find free fun
No matter what you like to do, there’s probably a free or cheaper version. For example, I love live music, but even a cheap concert ticket can cost $45. If I go twice a month, that’s $1,080 a year. But my city hosts weekly free concerts downtown. The bands are usually local, but they’re good and free. Now I only buy tickets to the big-name bands once or twice a year, saving about $1,000.
19. Buy last-generation electronics
Buying the latest and greatest electronics isn’t always worth it. Electronics like smartphones are updated and released so frequently that the changes made from one year to the next can be barely noticeable to the average user. And soon as the new device comes out, the old device gets cheaper. So wait and buy year-old devices to save.
20. Haggle
I never used to haggle, not even at a garage sale, but then my sister scored a $100 discount on a new couch just by asking – and I was hooked. Ask for a discount before you buy anything, even at a major retailer. You could get a reduction in price just by asking.
21. Stop buying new books
I’ve been eying the new Charlaine Harris book, but Amazon wants $21.95 for a hardcover copy. I know there are plenty of ways to get a book free or dirt cheap, so I’m waiting. And you should too. Buying new books is costly, especially when you can get them for free at the public library or by using a book swapping service. Check out the 4 Best Sites for Trading in Old Books.
22. Buy used
I recently did a story called 20 Things You Shouldn’t Buy Used. And for those 20 things – like helmets, cribs, and mattresses – I stand by my statement: Don’t buy them used. But for everything else, you can save 50 percent or more by combing Craigslist, garage sales, and resale shops. Want some ideas on what you should buy used? Check out 14 Things You Should Always Buy Used.
23. Turn off the advertising
I rarely watch live TV, and I don’t subscribe to beauty magazines, so I don’t feel the pressure of advertising. But when I’m in the salon browsing through a magazine, I inevitably find half a dozen products I think I need right now. I wouldn’t have known those products even existed if I hadn’t opened that magazine. Start avoiding commercials and ads, and you’ll save a ton of money.
24. Use household products instead of commercial ones
The number of commercial products on the market is seemingly endless – especially cleaning and beauty products. You can spend a good chunk of your income buying special products designed to only do one job – or you can save that money and use something you already have around the house. Check out 19 Uses for Baking Soda, Dryer Sheets, and Beer for ideas – like using baking soda as a facial scrub, or cleaning your windows with vinegar.
25. Go meatless
One pound of 93 percent lean hamburger meat costs $6.95 in my local grocery store – and we go through about a pound in one meal at my house. To save my money and my health, I’ve stopped eating so much meat – especially red meat. I used to buy three of those packages per week, spending $20.85. Now I eat three meatless meals a week and save that money, which adds up to just more than $1,000 a year.
http://finance.yahoo.com/news/25-simple-ways-save-extra-055511855.html
Monday, August 6, 2012
Gold investment accounts revisited
Want to invest in gold but deterred by the risks and hassle of keeping physical gold bars? Then gold investment accounts, which allow you to buy and sell gold and keep track of your transactions through a passbook, may be for you.
When gold investment accounts reviewed in June last year, they were only available at three banks — Kuwait Finance House, Public Bank and Maybank. Due to gold’s growing popularity, CIMB and United Overseas Bank (M) (UOB) have jumped onto the bandwagon as well. All banks, except for Kuwait Finance House, use Swiss Pamp as the underlying gold bar for their gold investment accounts. Kuwait Finance House uses a generic gold bullion and UOB uses different gold bullions. Investors can select their preferred brand when making a withdrawal (see opposite page).
You must have a savings or current account at the bank to open a gold investment account. On Aug 23, gold prices hit a record US$1,911 (RM5,688) an ounce in Asia. On the back of rising prices, the buy and sell prices of gold investment accounts have also increased by about 30% over a period of 15 months. A year ago, the precious metal’s purchase price (the price at which the banks buy the gold from customers) ranged from RM121 and RM123, and the sell price (the price at which the banks sell the gold) ranged from RM126 to RM128. At the end of August, the buy price ranged from RM174 to RM178, while the sell price ranged from RM180 to RM185.
To enhance your returns, choose an account that has the smallest spread (the difference between the buy and sell prices). New players such as UOB and CIMB offer the narrowest spreads, with UOB outshining its competitors with 0.55% and 1.1% for the Premier Gold Account and Gold Savings Account respectively. Kuwait Finance House has the highest spread of 4.45%. As always, watch out for fees that will negate your returns. CIMB, Public Bank and UOB impose a fee if the minimum balance falls below a stipulated level at month- and year-ends. Kuwait Finance House does not impose any additional fees. Public Bank levies the highest fees; when customers make a withdrawal of physical gold, the conversion fees ranging from RM220 to RM270 are the highest among the banks. Think about the type of withdrawals that you want to make from these accounts.
Not all banks allow you to withdraw physical gold, and if it does, a conversion fee might be levied. For example, at CIMB, if you withdraw 10g of physical gold, you would still get the best nett return despite the conversion fee of RM1 for every gram of gold (based on bank’s buy-sell prices as at Aug 22). Consider, too, how much money you can set aside for your investment. Maybank offers the lowest entry barrier with a minimum deposit of 1g. It also imposes the lowest minimum balance of 1g. In contrast, UOB requires the highest minimum initial deposit and balance, although it offers the narrowest spread. As with any other investments, do not forget to evaluate the risks.
While such accounts permit you to reap favourable returns from appreciations in gold prices, you will make a loss if the price of gold plummets. These gold investment accounts do not earn interest income and the balance kept in the account is not protected by the government’s deposit insurance scheme, Perbadanan Insurans Deposit Malaysia (PIDM).
When gold investment accounts reviewed in June last year, they were only available at three banks — Kuwait Finance House, Public Bank and Maybank. Due to gold’s growing popularity, CIMB and United Overseas Bank (M) (UOB) have jumped onto the bandwagon as well. All banks, except for Kuwait Finance House, use Swiss Pamp as the underlying gold bar for their gold investment accounts. Kuwait Finance House uses a generic gold bullion and UOB uses different gold bullions. Investors can select their preferred brand when making a withdrawal (see opposite page).
You must have a savings or current account at the bank to open a gold investment account. On Aug 23, gold prices hit a record US$1,911 (RM5,688) an ounce in Asia. On the back of rising prices, the buy and sell prices of gold investment accounts have also increased by about 30% over a period of 15 months. A year ago, the precious metal’s purchase price (the price at which the banks buy the gold from customers) ranged from RM121 and RM123, and the sell price (the price at which the banks sell the gold) ranged from RM126 to RM128. At the end of August, the buy price ranged from RM174 to RM178, while the sell price ranged from RM180 to RM185.
To enhance your returns, choose an account that has the smallest spread (the difference between the buy and sell prices). New players such as UOB and CIMB offer the narrowest spreads, with UOB outshining its competitors with 0.55% and 1.1% for the Premier Gold Account and Gold Savings Account respectively. Kuwait Finance House has the highest spread of 4.45%. As always, watch out for fees that will negate your returns. CIMB, Public Bank and UOB impose a fee if the minimum balance falls below a stipulated level at month- and year-ends. Kuwait Finance House does not impose any additional fees. Public Bank levies the highest fees; when customers make a withdrawal of physical gold, the conversion fees ranging from RM220 to RM270 are the highest among the banks. Think about the type of withdrawals that you want to make from these accounts.
Not all banks allow you to withdraw physical gold, and if it does, a conversion fee might be levied. For example, at CIMB, if you withdraw 10g of physical gold, you would still get the best nett return despite the conversion fee of RM1 for every gram of gold (based on bank’s buy-sell prices as at Aug 22). Consider, too, how much money you can set aside for your investment. Maybank offers the lowest entry barrier with a minimum deposit of 1g. It also imposes the lowest minimum balance of 1g. In contrast, UOB requires the highest minimum initial deposit and balance, although it offers the narrowest spread. As with any other investments, do not forget to evaluate the risks.
While such accounts permit you to reap favourable returns from appreciations in gold prices, you will make a loss if the price of gold plummets. These gold investment accounts do not earn interest income and the balance kept in the account is not protected by the government’s deposit insurance scheme, Perbadanan Insurans Deposit Malaysia (PIDM).
Spending guide to curb splurging
It’s easy to overspend during the year-end festivities, what with annual bonuses in hand and sales galore at the malls and department stores. Here are some budget-friendly tips.
Use cash Try not to put all your purchases on your credit card, especially if you’re doing all your shopping at the last minute. Using cash helps you to stay within budget as you will be buying only what you can afford. Shop online It pays to compare prices when shopping, not only for the festive season but also at all times, and the Internet offers opportunities for you to compare prices and get bargains. Irra Core, a working mother, says aside from not having to go to the physical store (and contend with the crowds), there’s the savings made on parking charges and petrol.
Online retailers such as www.bookdepository.com and www.asos.com offer free shipping, and on top of that, with the current favourable exchange rates, items bought through online US-based stores may be cheaper than those available in Malaysia. Some online retailers even gift-wrap your purchases, which is an added plus. In addition, some online retailers also offer coupons for additional discounts for subsequent purchases. Cash in on reward points Put your credit card reward points to good use by redeeming shopping vouchers or gifts. Although it’s not really savings, since you’re already using your credit card throughout the year, you may as well put the reward points accumulated to good use, says Core, who often saves up the reward points for shopping vouchers that she then uses for gift purchases. Know what you’re buying With all the sales, deals and offers at the end of the year, it’s easy to be blinded by so-called store bargains. So, it’s important that you know how much things cost and what you’re getting for that price, especially when it comes to electronic items. For instance, you may come across an attractive deal for a particular product but it may be an older model or is missing some features or specifications.
Scale down You don’t need to get a gift for everyone, especially colleagues you hardly know or speak to, or relatives twice or thrice removed! Avoid giving out of guilt or over-giving — just because you received a gift from a near stranger, or received an extravagant gift from a friend, does not mean you have to reciprocate in a similar fashion. Also, bear in mind that gifts need not be expensive, as at the end of the day, it’s the thought that counts. Make your own A less expensive but meaningful gift option is to make your own presents — whether it’s edible goodies like jars of preserve, cookies and cakes, or crafted items such as soaps and candles. If you’re baking, opt for something seasonal like Christmas cookies or pumpkin spiced bread, suggests Core. “And it’s really cheaper because you can buy all the ingredients in bulk and then set aside an afternoon for baking and wrapping. It involves time and commitment, but you are adding a personal touch to gifting, which is always nice,” she adds. You can also make your own decorations or embellish run-of-the-mill items. For example, instead of decorative candles, buy simple pillar candles and dress them up with pushpins and ribbons. Entertain wisely When it comes to entertaining during the holidays, many swear by potluck. “Have a theme and when your guests ask what they can bring or how they can help, suggest that they bring something from the menu and if they don’t see anything they can make or bring, they can bring a bottle of their favourite wine,” says Core. Similarly, if you’re invited to parties, ask the host or hostess what you can bring. But if potluck is not your cup of tea, consider scaling down the entertainment. Instead of planning a big bash, opt for a more intimate dinner party with just the family and close friends. If you like to serve wine, start stocking up throughout the year and if you travel often, this is when all the duty-free shopping will pay off!
Set a budget Determine how much you are prepared to spend this holiday season — whether it’s for gifts, entertainment or decorating. Set a budget based on how much money you have available. If you have many gifts to buy, then it’s also a good idea to set a limit on how much you’d be willing to spend, whether it’s per item or per person. Plan and budget for the holiday expenses at the start of the year by setting aside some money every month to be used during the festive season. It may take some resolve to put money into the holiday kitty each month but you’ll be glad you did come December! And as with any budget, you need to be disciplined and stick to it. Shop for gifts throughout the year Don’t wait until the 11th hour to get your Christmas or New Year shopping done. Whenever you’re out shopping or travelling, keep an eye out for great gifts. There are also bound to be a few sales during the year, so take advantage of them. A gift picked up from your holidays abroad not only makes a unique present but also shows that you were thinking of the recipient during your trip.
Keep track of whom you’re buying for and what you’re getting them, advises Cynthia Yap. The busy working mother of two organises her gift shopping with a spreadsheet that has the names of recipients in one column and their ideal gifts, based on their likes and interests, in a corresponding column. This ensures that she doesn’t repeat a gift the following year, she says. Track how you fared this year Once the holiday dust has settled and all that gift giving and entertaining is done, track your expenses for the holidays. If you were on budget, make it your goal to decrease your spending next year. But if you’ve overspent, go over your expenses and see where you went wrong so as to avoid making the same mistake next year.
http://www.theedgemalaysia.com
Use cash Try not to put all your purchases on your credit card, especially if you’re doing all your shopping at the last minute. Using cash helps you to stay within budget as you will be buying only what you can afford. Shop online It pays to compare prices when shopping, not only for the festive season but also at all times, and the Internet offers opportunities for you to compare prices and get bargains. Irra Core, a working mother, says aside from not having to go to the physical store (and contend with the crowds), there’s the savings made on parking charges and petrol.
Online retailers such as www.bookdepository.com and www.asos.com offer free shipping, and on top of that, with the current favourable exchange rates, items bought through online US-based stores may be cheaper than those available in Malaysia. Some online retailers even gift-wrap your purchases, which is an added plus. In addition, some online retailers also offer coupons for additional discounts for subsequent purchases. Cash in on reward points Put your credit card reward points to good use by redeeming shopping vouchers or gifts. Although it’s not really savings, since you’re already using your credit card throughout the year, you may as well put the reward points accumulated to good use, says Core, who often saves up the reward points for shopping vouchers that she then uses for gift purchases. Know what you’re buying With all the sales, deals and offers at the end of the year, it’s easy to be blinded by so-called store bargains. So, it’s important that you know how much things cost and what you’re getting for that price, especially when it comes to electronic items. For instance, you may come across an attractive deal for a particular product but it may be an older model or is missing some features or specifications.
Scale down You don’t need to get a gift for everyone, especially colleagues you hardly know or speak to, or relatives twice or thrice removed! Avoid giving out of guilt or over-giving — just because you received a gift from a near stranger, or received an extravagant gift from a friend, does not mean you have to reciprocate in a similar fashion. Also, bear in mind that gifts need not be expensive, as at the end of the day, it’s the thought that counts. Make your own A less expensive but meaningful gift option is to make your own presents — whether it’s edible goodies like jars of preserve, cookies and cakes, or crafted items such as soaps and candles. If you’re baking, opt for something seasonal like Christmas cookies or pumpkin spiced bread, suggests Core. “And it’s really cheaper because you can buy all the ingredients in bulk and then set aside an afternoon for baking and wrapping. It involves time and commitment, but you are adding a personal touch to gifting, which is always nice,” she adds. You can also make your own decorations or embellish run-of-the-mill items. For example, instead of decorative candles, buy simple pillar candles and dress them up with pushpins and ribbons. Entertain wisely When it comes to entertaining during the holidays, many swear by potluck. “Have a theme and when your guests ask what they can bring or how they can help, suggest that they bring something from the menu and if they don’t see anything they can make or bring, they can bring a bottle of their favourite wine,” says Core. Similarly, if you’re invited to parties, ask the host or hostess what you can bring. But if potluck is not your cup of tea, consider scaling down the entertainment. Instead of planning a big bash, opt for a more intimate dinner party with just the family and close friends. If you like to serve wine, start stocking up throughout the year and if you travel often, this is when all the duty-free shopping will pay off!
Set a budget Determine how much you are prepared to spend this holiday season — whether it’s for gifts, entertainment or decorating. Set a budget based on how much money you have available. If you have many gifts to buy, then it’s also a good idea to set a limit on how much you’d be willing to spend, whether it’s per item or per person. Plan and budget for the holiday expenses at the start of the year by setting aside some money every month to be used during the festive season. It may take some resolve to put money into the holiday kitty each month but you’ll be glad you did come December! And as with any budget, you need to be disciplined and stick to it. Shop for gifts throughout the year Don’t wait until the 11th hour to get your Christmas or New Year shopping done. Whenever you’re out shopping or travelling, keep an eye out for great gifts. There are also bound to be a few sales during the year, so take advantage of them. A gift picked up from your holidays abroad not only makes a unique present but also shows that you were thinking of the recipient during your trip.
Keep track of whom you’re buying for and what you’re getting them, advises Cynthia Yap. The busy working mother of two organises her gift shopping with a spreadsheet that has the names of recipients in one column and their ideal gifts, based on their likes and interests, in a corresponding column. This ensures that she doesn’t repeat a gift the following year, she says. Track how you fared this year Once the holiday dust has settled and all that gift giving and entertaining is done, track your expenses for the holidays. If you were on budget, make it your goal to decrease your spending next year. But if you’ve overspent, go over your expenses and see where you went wrong so as to avoid making the same mistake next year.
http://www.theedgemalaysia.com
Tips on how to choose unit trust funds
UNIT trust funds offer an attractive alternative to retail investors, especially those looking for the benefit of diversification with a small pool of capital while enjoying the possibility of earning higher returns compared with conventional savings.
However, a lot of people have the misconception that the diversification nature of these funds means that the risk of investing in unit trust is low and they can just close their eyes and simply pick any of the funds that come along. This misconception has led to many paying high prices in learning that as in any type of investments, investing in unit trust funds requires some basic understanding and research before we commit our hard earned money to it. In general, we can classify the unit trust funds in the market into two major categories: income funds and growth funds. ·Income funds usually are characterised as providing consistent income to the investors.
These funds invest in income-producing stocks or bonds or a combination of both. Bond funds, equity income funds and money market funds are included in this category. ·Growth funds generally are more aggressive than income funds but have the possibility of earning higher returns by focusing on the objective of long-term capital appreciation rather than income producing or short-term gain. Examples of growth funds are small-cap funds, commodity funds, index funds and gold funds. Before we start evaluating the funds to invest in, there are two main considerations which are our investment objectives and risk tolerance level. Every investor invests for his own purpose.
If you are investing for your retirement and are already close to retirement age, you should look for income funds that are more predictable. However, if you are still young and want to save for your children’s higher education, which will be 10 or 15 more years, you may want to look for growth funds that generate higher return but with higher level of risk. Once we are clear on what we are looking for in the investment, we can narrow down our selection to either income or growth category and move to the next step of identifying the most suitable funds within the selected category. Here are a few key factors to look into when evaluating unit trust funds: ·Investment strategy, policy and holdings:
Every fund has its own investment profile. Investors should have a clear understanding of the investment strategy taken in each fund that they are considering to ensure it is consistent with their personal investment objective and risk tolerance level. Even the funds within the same category may have significant differences in risk exposure due to the difference in the investment holdings. For example, the risk exposure in large-cap growth companies is definitely much lower than for penny stock funds. ·Past performance: Investors may look into the past performance trend of the fund to gauge its future performance. However, do bear in mind that good past performance may not be repeated in the future and we should not be overly excited to see one year of good results if the fund is only newly established.
A good fund should be the one that has been consistently out-performing its peers, be it during good or bad times. ·Cost: Investors must be aware that when they buy or sell the funds, there are fees and expenses embedded in every transaction. For example, the expense ratio of a small fund tends to be higher than a large fund while a regional or global fund usually will carry higher costs compared with a domestic fund. ·Fund management: The fund management is very important to ensure continuity and consistent performance.
If a fund changes management too frequently, it will be very difficult for us to gauge the performance of the fund as different managers will have different styles which may affect the performance of the fund. For example, if the manager tends to have higher portfolio turnover, then the expense ratio of the fund may increase even though the nature of the fund holdings remains the same. By having good understanding of the above factors, we may be able to make meaningful comparisons among funds that we are interested in to identify the ones that suit us most. The Star -http://biz.thestar.com.my
However, a lot of people have the misconception that the diversification nature of these funds means that the risk of investing in unit trust is low and they can just close their eyes and simply pick any of the funds that come along. This misconception has led to many paying high prices in learning that as in any type of investments, investing in unit trust funds requires some basic understanding and research before we commit our hard earned money to it. In general, we can classify the unit trust funds in the market into two major categories: income funds and growth funds. ·Income funds usually are characterised as providing consistent income to the investors.
These funds invest in income-producing stocks or bonds or a combination of both. Bond funds, equity income funds and money market funds are included in this category. ·Growth funds generally are more aggressive than income funds but have the possibility of earning higher returns by focusing on the objective of long-term capital appreciation rather than income producing or short-term gain. Examples of growth funds are small-cap funds, commodity funds, index funds and gold funds. Before we start evaluating the funds to invest in, there are two main considerations which are our investment objectives and risk tolerance level. Every investor invests for his own purpose.
If you are investing for your retirement and are already close to retirement age, you should look for income funds that are more predictable. However, if you are still young and want to save for your children’s higher education, which will be 10 or 15 more years, you may want to look for growth funds that generate higher return but with higher level of risk. Once we are clear on what we are looking for in the investment, we can narrow down our selection to either income or growth category and move to the next step of identifying the most suitable funds within the selected category. Here are a few key factors to look into when evaluating unit trust funds: ·Investment strategy, policy and holdings:
Every fund has its own investment profile. Investors should have a clear understanding of the investment strategy taken in each fund that they are considering to ensure it is consistent with their personal investment objective and risk tolerance level. Even the funds within the same category may have significant differences in risk exposure due to the difference in the investment holdings. For example, the risk exposure in large-cap growth companies is definitely much lower than for penny stock funds. ·Past performance: Investors may look into the past performance trend of the fund to gauge its future performance. However, do bear in mind that good past performance may not be repeated in the future and we should not be overly excited to see one year of good results if the fund is only newly established.
A good fund should be the one that has been consistently out-performing its peers, be it during good or bad times. ·Cost: Investors must be aware that when they buy or sell the funds, there are fees and expenses embedded in every transaction. For example, the expense ratio of a small fund tends to be higher than a large fund while a regional or global fund usually will carry higher costs compared with a domestic fund. ·Fund management: The fund management is very important to ensure continuity and consistent performance.
If a fund changes management too frequently, it will be very difficult for us to gauge the performance of the fund as different managers will have different styles which may affect the performance of the fund. For example, if the manager tends to have higher portfolio turnover, then the expense ratio of the fund may increase even though the nature of the fund holdings remains the same. By having good understanding of the above factors, we may be able to make meaningful comparisons among funds that we are interested in to identify the ones that suit us most. The Star -http://biz.thestar.com.my
Sunday, July 22, 2012
Choosing Unit Trust
There are many unit trusts funds from which to choose, but having considered the type of fund or funds most likely to meet your needs, you have already narrowed down your choices considerably.
The next logical step is to decide which unit trust fund to invest in.
What To Look For ?
A random check will confirm most, if not all, investors would look at the performance or investment results.
Unfortunately, it is impossible to predict a unit trust's future investment performance. This will depend on the type of fund, the general market trends and the investments which a fund manager picks.
Most managers would provide the past performance tables that normally show the total returns since inception or how much an initial investment made several years ago would be worth today with any income reinvested.
Look at the performance of the funds but do not pay too much attention to period of a year or less - external factors beyond the control of the managers may have influenced results - a high flyer may not stand the test of time. Ideally, a fund showing consistent performance over a long period, the longer the better.
Check the performance of a company's other funds to make sure that it was not just a bit of luck with one fund.
Do not let another type of fund take your fancy just because it has produced better results than the one you had initially chosen. It may be more risky and may not meet your requirements.
However, be warned, past performance figures are no guarantee of the future. A fund that has performed well in the past may not do so in the future and vice versa. Go to Fund Performance for fund comparisons.
Do's and Don'ts of Choosing a Unit Trust Fund
Do
-Decide which type of unit trust fund meets your saving needs.
-Shop around for a reliable unit trust company
-Check whether investment limits, frequency of income payments, etc, are suitable
-Check past performance records
Don't
-Don't choose any unit trust fund just because its performance has been good, make sure it is the right fund for you.
-Don't pay too much attention to short term performance, good consistent performance over all periods is the best lead.
-Don't decide on a unit trust fund just because it has low charges, good performance is far more important
-Don't borrow to invest in unit trust unless you are absolutely aware of the risk involved.
Source:islamic-invest-malaysia.com
The next logical step is to decide which unit trust fund to invest in.
What To Look For ?
A random check will confirm most, if not all, investors would look at the performance or investment results.
Unfortunately, it is impossible to predict a unit trust's future investment performance. This will depend on the type of fund, the general market trends and the investments which a fund manager picks.
Most managers would provide the past performance tables that normally show the total returns since inception or how much an initial investment made several years ago would be worth today with any income reinvested.
Look at the performance of the funds but do not pay too much attention to period of a year or less - external factors beyond the control of the managers may have influenced results - a high flyer may not stand the test of time. Ideally, a fund showing consistent performance over a long period, the longer the better.
Check the performance of a company's other funds to make sure that it was not just a bit of luck with one fund.
Do not let another type of fund take your fancy just because it has produced better results than the one you had initially chosen. It may be more risky and may not meet your requirements.
However, be warned, past performance figures are no guarantee of the future. A fund that has performed well in the past may not do so in the future and vice versa. Go to Fund Performance for fund comparisons.
Do's and Don'ts of Choosing a Unit Trust Fund
Do
-Decide which type of unit trust fund meets your saving needs.
-Shop around for a reliable unit trust company
-Check whether investment limits, frequency of income payments, etc, are suitable
-Check past performance records
Don't
-Don't choose any unit trust fund just because its performance has been good, make sure it is the right fund for you.
-Don't pay too much attention to short term performance, good consistent performance over all periods is the best lead.
-Don't decide on a unit trust fund just because it has low charges, good performance is far more important
-Don't borrow to invest in unit trust unless you are absolutely aware of the risk involved.
Source:islamic-invest-malaysia.com
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