Friday, February 27, 2009

EPF @ KWSP Contributions Reduced to 8% - Part 6 - EPF Third Schedule

Have you got your Jan'09 or Feb'09 salary slip from your employer? If yes, did you check through your salary slip to see whether your request to maintain your contribution rate at 11% has been processed accordingly? Just make sure your EPF contribution is 11%. Actually, the contribution rate is not exactly at 11%. There are slight differences. You can refer to EPF Third Schedule or KWSP Jadual Ketiga. You will find the structure of contribution rates (in Ringgit Malaysia), for both employee and employer. You will get a clearer picture of your monthly EPF deduction.

If you opted for the 8% contributions, you will need to refer to EPF - Amendment of Third Schedule to know the new contribution amount. KWSP required all employers to follow this new structure. You can read the news here.

Let's keep growing our nest egg!

Wednesday, February 25, 2009

Malaysian Private Vehicle Owner CASH Rebate For Fuel Subsidy To End By 31 Mar 2009

Time flies. It has been almost a year since the Malaysian government introduced the cash fuel rebate to subsidize the high oil price last year. I've got my rebate in June 2008 and it's cash RM625.00.

Today's news on The Star Online stated that the cash fuel rebate will end on 31 Mar 2009. Those who has not made their claim are advise to do so before the due date. The claim or rebate process is very simple. You can go to any of POS Malaysia offices nationwide. You must bring along your IC. Fill in the related form and wait for your turn. If you don't have time to go to POS Malaysia office, you may do so - online at For online claim, you can choose to receive your cash by Money Order or to be bank-in to your bank account. For more details, you can visit POS Malaysia website.

Have you got your rebate? If not, act quick before 31 Mar 2009.

Updated on 20th March 2009: The Malaysian private vehicle owner cash rebate of RM625 will be extended till 14 April 2009. You can read the news here.

Sunday, February 22, 2009

EPF @ KWSP - 2008 Dividend Rate???

I had been frequently checking on KWSP website since early January this year for the 2008 dividend announcement. I had also been checking on local newspapers on the announcement as well. Tonight, a local tv news said that KWSP will announce its 2008 dividend by next month. I was a bit disappointed as for last year, KWSP announced its 2007 dividend on 31 Jan 2008.

I believe most of us, the EPF contributors are waiting impatiently for the dividend announcement. At a total contribution of 23% from our monthly wages, it's quite a huge sum of $$$ isn't it? Let's hope and pray for the best.

Updated on 17 Mar 2009: See related post EPF @ KWSP - 4.50% Dividend Rate For 2008

Friday, February 20, 2009

Money & Marriage - Who's The Chief Financial Officer (CFO)?

Personally I believe managing finances in a marriage is very much like running a business. Just that, it's a life-long business with 2 main business partners, the husband and the wife. From my readings and observations, there are 3 main different styles of money management in a marriage:

1) The husband is the CFO
This is very common especially in eastern regions. Husbands are regarded as the head of the family and thus automatically carry the CFO title. He brings money home, plans all the spending, investment and makes all financial decisions. This style is usually practised when the husband is the sole bread winner in the family.

2) The wife is the CFO
There are women who are really good at managing finances. Even there are man who brings home money and give all his money to his stay-at-home wife. He also give full authority to his wife to do all financial decisions.

3) Both husband and wife are CFOs
When both husband an wife are working and bringing home money, it's fair that both contribute to the CFO positions. Both must list down all financial related matters (spending plan, loan repayments, investments, savings, insurance, retirement planning, children education funds, etc) and divide their tasks accordingly. Both are given authority on their agreed tasks and are responsible for their tasks. Even better when both agree to discuss before making their financial decisions.

Other than the above, there's another money management style in a marriage, which I find more creative is:

4) Husband and wife take turn to be the CFO
It might sound funny or impossible. But, I think it's creative and fun. Even CFO in a company also has renewal term right? If a partner can't prove that he or she can manage the finances well, it's time to pass the cheque books to the other partner. Perhaps, one might not know aware that he or she is good at managing finances until he or she is given the opportunity. It is good to practise to allow 1 or 2 years or 5 years for each partner to take turn to be the CFO.

So, who's the CFO in your marriage? Be it you or your partner or both of you together, make sure that both of you do not let money become an issue in your marriage.

Wednesday, February 18, 2009

PB Gold Investment Account - Part 4

It has been almost 6 months since I first invested in Public Bank Gold Investment Account. The unit price for my first purchase was RM98.3500/g. Then, the unit price slightly dropped to about RM85/g in October'08. Today, when I checked at Public Bank Gold Investment Account website, the selling price is at RM116.9000/g (rates as at 18 Feb 2009, 3:51pm). That's an increment of about 19% within 6 months! Impressive isn't?
It is time for me to gather some $$$ and top up my PB Gold Investment Account.

Tuesday, February 17, 2009

One-Lump-Sum Investment vs Dollar-Cost-Averaging

In this post, I will show a simple calculation to share the differences between investment through One-Lump-Sum and Dollar-Cost-Averaging. The parameter as below:
1) Total cash available for investment is RM6000
2) Initial price is RM0.25/unit
3) Assumption that the sales charge for this particular fund is 5.5%
4) Investment period is 6 months
5) No withdrawal or dividend received within this 6 months

Based on the table above, by using Dollar-Cost-Averaging method to spread the investment of RM6k over 6 months (with RM1k invested on 1st day of the month), the total unit accumulate is slightly more than One-Lump-Sum investment of RM6k. Of course there are other factor involved. If the market price keep increasing, then the total unit accumulated will be slightly less. And again, no one can time the market. So, we are trying our best not to miss the opportunity to invest when the unit price is lower.
Feel free to share your view with me. Together we learn for a better financial future. Happy Investing!

Monday, February 16, 2009

Smart Unit Trust Investment Method Through Dollar-Cost-Averaging

Dollar-Cost-Averaging or Ringgit-Cost-Averaging is an investment method whereby investor invest a fixed amount of $$$ on a regular basis rather than invest a whole lump sum of $$$ at one time. By using Dollar-Cost-Averaging method, investor will get more units when the price is low and fewer units when it is high. The benefit of Dollar-Cost-Averaging is investors will own unit trust with prices bought in different stages of a market cycle (regardless of the market condition) thus reducing the average cost of their investment portfolio.

Personally I find that Dollar-Cost-Averaging method is very suitable for me as I find it is very hard to time the market. We had always wish to know when the market had hit the bottom, but in actual, we never know when the time is here. Or, by the time we realised, it is too late and we missed the opportunity. To avoid this problem, I arranged for Standing Instruction (SI) with my bank to deduct a certain amount from my saving account, on a selected date to invest in my desired unit trust. It saves me my time and worries that I would miss the 'buy low' opportunities.

To best compliment my Dollar-Cost-Averaging method, I still enjoy monitoring the market price from time to time and invest additional $$$ when the market price hit certain point which I consider 'low price'. Of course, we hope to get the most from our investment right? Happy Investing!

Saturday, February 14, 2009

Happy Valentine's Day!

Happy Valentine's Day to you and your loved ones. May you and your loved ones have a wonderful and meaningful year ahead. May there're will be more love on Earth as well.

Thursday, February 12, 2009

Bank Personal Loan

On a Monday afternoon last month, a guy from a local bank called me and wish to lure me with his personal loan idea. He first told me that for personal loan, there's no guarantor needed and fast approval. When I hear the word personal loan, I told him I am not interested for personal loan. He continue to ask me on my current credit card limit. Then, he said his bank can offer me RM15K personal loan without any documentation needed. I was quite annoyed as I told him earlier that I am not interested in personal loan. He sound quite polite type, just that he's persistent with his sales ideas. So, I politely told him that I am not interested and I don't need personal loan, and I also thank him for calling me. He still insist perhaps I might consider the personal loan for emergency needs. Still, I told him I don't need personal loan.

Last Saturday afternoon, another different guy from the same local bank call me again and asking me the same questions and still want me to take up his personal loan idea. When I was about to hang up the call, he asked me whether I wish to use the personal loan to settle my credit card outstanding amount. I told him 'I don't have outstanding with my credit cards. I settle full payment every month'. He seemed a bit surprised and then say goodbye to me.

I am quite annoyed by the officers from the same bank calling me to introduce personal loan. If they wish to introduce other bank products such as insurance, investment or other saving products, I can understand their purposes. But, not for personal loan. It's not wise to encourage someone to take up personal loan. It's just like digging a hole for them, and asking them to put their legs into the hole. They must find ways to get out from the hole, else their whole body might ended up in the hole.

Monday, February 9, 2009

Financial Planning - 8 Simple Steps To Cultivate Young Saver

Other than sending your kids to the daily tuition classes, weekly piano lessons or foreign language classes, have you ever think of sending your kids to financial planning classes in their early years? If yes, you're really a financially wise parents. But, do we have such classes yet? No, at least within my surroundings, I haven't heard anyone sending their kids to money management classes yet.

Since there's no formal financial education classes, parents and family play a very important role as a training ground to prepare a child to manage their future financial matter. Perhaps you think that it is hard to have moneytalk with your young kids, but do you know that what you're practicing everyday, indirectly giving them a strong message which directly shape their financial mind?

Thus, I listed below 8 simple practices to cultivate a young saver as below:

1) Bring your kids to the ATM or Bank whenever you do transactions. Share with them the function of banks. Their curiosity nature will result in questions they ask about banking institution. Such as 'Why there're money in the ATM?' Do explain to them in a simple way but
always provide real explanations.

2) Bring them along when you settle your monthly electricity/water/telephone bills. This will show them the monthly commitment they need to prepare when they start their own family or live on their own in the future

3) Give them pocket money or daily/weekly/monthly allowance when they started to know the value of money. The most suitable time is when they started their kindergarten years. Do not give more than enough.

4) Prepare a big piggy bank for them. Teach them to save from their pocket money or allowance to buy desired stuff (toys, books, computer games).

5) Open a saving account for them at local banks. Encourage them to bank-in their savings or cash gifts (angpaos or duit raya) collected during festive season into their saving account. Perhaps can motivate them by adding some interest every time you bank-in the saving for them.

6) Establish short term and long term saving plans for them. Short term saving plan could be buying that computer game. Long term saving could be saving for their tertiary education.

7) Bring your kids and your grocery shopping list along for your weekly shopping. Invite them to write what they need in your grocery shopping list. Teach them to compare prices before do the final purchase.

8) Most importantly, show by example. Do not lavish yourself with an expensive shoe cost RM500 while saying 'NO" to your kid when she requested you to buy her a barbie doll set of RM9.90

I learned most of the practices above by observing my 8-years-old niece's attitude towards money. If you have any other practices to add in, do share with me. I hope you will have a successfuly financial sharing sessions with your kids. And also hope we will be able to build a financially strong generations.

Thursday, February 5, 2009

Disadvantages Of Online Banking @ E-banking - safety and security issues

Online banking or e-banking makes our life much easier. Save us a lot of hassle and travelling time. Convenient and it's 7 days a week. But, nothing is perfect. The scary part is the safety and security issues involved in online banking.

I read an interesting article on MSN and find it worth to share the 9 smart tips which can protect us, the online banking users:

1. When logging on to a bank Web site, a user should look closely at the site's URL to make sure it matches the bank's name. A more secure URL will begin with "https://" and be followed by the bank name. Make sure the bank's padlock is displayed in a corner of the site before you log on.

2. Log on to banks only from a secure computer. Never log on from a public computer in a hotel or cafe, and be careful when logging on to unknown networks with a laptop.

3. If you get a warning e-mail, call your bank -- don't click on any provided links.

4. If your computer is acting strangely -- for instance, reacting slowly or getting pop-ups -- avoid using it for online banking until you can get it checked out.

5. Keep anti-virus and anti-spyware software up to date.

6. Install and maintain a firewall.

7. Never respond to any e-mail that requests personal information.

8. Be leery of fly-by-night, Internet-only banks with high interest rates on savings or checking accounts. Make sure the bank is FDIC-certified and is insured.

9. And, most importantly, use a different user name and password for each financial account. The password should be complex, with numbers and symbols, and changed regularly.

Still, there are no guarantees.

You can read the complete article here. Happy reading!

Tuesday, February 3, 2009

2009 Zodiac Prediction For The Year Of Ox - in English

2009 Zodiac Forecast JuXianGuan

Money Lending To Friends And Family

Since childhood, there are situation where friends and relatives request to borrow some $$$ from me. Usually, I won't lend them my $$$ unless I am prepared not to receive the $$$ back.

Money can be a very sensitive issue. It has proven records in breaking marriage, family and relationship. So, If I feel my lending does not brings any benefit to the borrower, I will just tell him 'Sorry, I don't have extra $$$'. In most cases, the borrow won't dare to question me back and requesting for the second time. If the borrower deserve my lending, then I will pass him the $$$. Deserve meaning he needs the $$$ for emergency and not just simply want to get financial sympathy. If he didn't pay back, then I just consider I donate the $$$ to him.

It's just too hard to remind borrowers especially closed friends and relatives to pay back our $$$.

Do you lend your money to friends and families?

Monday, February 2, 2009

The Danger Of Credit Cards!

Credit Card. It's convenient, simple and easy to use. It's not heavy and you can bring along wherever you go. For those who can control their finance and know well to manage their spending, credit card is a plastic cash which bring benefits to them. But, for those who spend like there's no tomorrow and use credit card to satisfy their unlimited wants, they will be in big trouble if they keep spending and using their future $$$. Their headache will start when they received the credit card statement. If they are lucky and smart enough, probably they'll be awake and try to settle the credit card outstanding as soon as possible.

But, unfortunately many of those in credit card debts find it hard to get out. They'll be happy just to settle the minimum payment. Some even try to get more cards and keep swiping their plastic cash. With the current outstanding interest rate of 18% per annum or 1.5% per month, it really take a lot of effort to settle a credit card debt. According to an article by Agensi Kaunseling Dan Pengurusan Kredit (AKPK), for someone with an outstanding balance of RM1,000 and decided to only pay the minimum of 5% or RM50 whichever is greater, the amount of interest charged to his card in the first month is about RM14.25 only. This might not sound a lot but if he continues this payment pattern, it’ll take 2 years for him to fully settle the initial balance of RM1,000. The total interest incurred would amount to about RM173.00. If the outstanding balance is RM10K – it will take more than 7 years to repay and the total interest incurred would come up to RM3,740! The calculation above is with condition where there's no add-on to the present balance. Sound scary isn't it?

It's really not wise to involve credit card debts in your life!

Sunday, February 1, 2009

Job Cuts!

The Star Online published on 29 Jan 2009 that according to The Malaysian Employers Federation (MEF), 10,000 Malaysians have lost their jobs since Jan 1. And more are expected to lost their jobs as companies are trying to keep themselves afloat. Outside of Malaysia, on 28 Jan 2009, The Star Online reported that 80,000 lose jobs in US and Europe while Iceland government collapses. The figures are increasing drastically.

It's going to be a tough decision for most employers but it's tougher for those affected employees. How are they going to survive without their pay cheques? How about their monthly house or car installment? And the kids? How long can the current saving last? Where to find a new job? It's going to be a hard time for these employees.

And of course these job cuts will directly affect the nationwide economy and world economy as a whole.Without job and income, with controlled and tight spending, there will be less business transactions conducted.with less cash circulating in business market, how can the global economy crisis recover?

Let's pray that these affected employees will find a new job very soon and there will be less job cuts.