So you managed to save RM1000 in your savings account. And you want to put it to good use.
You want to invest it.
But how?
Coming from a guy who used to be unable to save anything for 2.5 years due to insufficient pay…
I can tell you upfront how best to think about investing that money for better financial security and ultimate R.O.I down the road.
Now, before you think of investing your money in anything…
Do these 2 things first:
1. Pay off all your monthly payments
If you have credit card debt, kill them off now like the spawn they are.
12% interest per year is no joke.
KILL THEM FAST AND HARD. Not softly like the Fugees.
Never miss a payment.
You know how you never miss that episode of Riverdale? Yeah, be like that with your payments.
If you have PTPTN, just pay the monthly. If you already did, you are a good person 🙂
If you have a mortgage, pay the monthly installments you signed on.
Whatever it is, never be behind on your payments.
All good? Let’s move on the next thing.
2. Save first, then invest
I see this all the time.
Tim Ka Ching see his friend at work making 327% returns on Bitcoin – in 6 months.
And he want to take part. And Tim is greedy.
He thinks: “If I invest this RM1000 which is all I have, I can have RM3270++ in 6 months!”
Well, can you guess what happened? He lost half this money in 3 months.
Sad Tim. And Bad Tim. Bad.
Which is why the 2nd rule exists:
Always have savings before you invest.
If you don’t have savings before you invest, you are shooting yourself in the foot.
Investing usually means you may lose money in the short term so you can make money in the long run.
So what happens if suddenly 3 of your best friends get married in the same month and you gotta give them Ang Paus that signal you are not a horrible and cheap human being?
Will your Bitcoin investment save you? No. You gotta HODL.
So what’s gonna help you? Exactly, your savings will save your a** for things like that (and most things in life, honestly).
So, how much should you save?
For starters, I always recommend employees to have 6 months expenses.
And entrepreneurs to have 12 month expenses saved up.
I know what you are saying:
Why not just 3 months? 6 months is a lot.
It is a lot. That’s why it’s gonna take a while.
I suggest 6 months because in the most cases, you would only be out of a job due to a recession.
And in tough times like those, you want to have as much time as possible to find the right job for you.
So I see it takes 5 months to find and land a job + waiting 1 month for the first month salary to come in.
As you save up that money, you want to park that moolah in a high interest savings account or Fixed Deposit.
For Fixed Deposit, I recommend putting it in 1-3 month periods. It’s long enough to make you abstain from touching it, and short enough to get some interest for your savings.
2.7% is still better than 0%.
If you’ve already done the above 2 things, what should you invest in?
I tend to be quite conservative with my investments. So these are what I did:
1. Low cost index funds
It has lower management fees than mutual funds (which means you could save RM100,000+ in fees over the lifetime of your investment).
Instead of picking individual stocks (which rarely works even for professionals), you get a pool of the top performing stocks in that market (US / Malaysia / wherever) and get returns based on overall market performance.
For the US, their performance for the last 50 years have been 8% per year.
It’s a perfect investment for those who want to be passive with their investing and still get great returns.
Tony Robbins interviewed billionaire investors and they recommend it. Warren Buffett recommends it. And Ramit Sethi recommends it too.
But the bad news is, it’s hard to invest in one directly as a Malaysian.
The closest thing you can get in Malaysia (which I did) is StashAway (disclaimer: referral link).
When you put money into your investment account, they show they invest into the US market mainly as well.
A few friends of mine told me that got a 10% return in 6 months so far.
I was surprised as well. So I signed up.
But remember, investing is not short term. It’s about the long run, until you retire.
You know what’s cooler than 10% in 6 months?
8% average over 40 years.
Now that’s magic.
2. Real estate
Nothing much to share here.
I partially invested in my first house when I was 25.
All I can say is, unless you are willing to commit to a 30 year loan and deal with potentially crappy tenants…
Best to just invest in REITS (Real Estate Investment Trusts) and get the returns from there.
If you are after the tangible asset (the house and land) instead of the returns — then your only avenue is buying the house itself and renting it out.
There is a lot to cover here so I will write about it in a separate blog post.
3. Invest in yourself
You saw that coming didn’t you 😉
If I had to pick the best investment I made since I graduated university that allowed me make 6 figures by the time I was 26…
It wasn’t index funds or property.
It was investing my time, effort and money into learning marketable skills.
Skills such as resume writing, interviewing, negotiating salaries, job hunting, digital marketing, copywriting and so on.
If it wasn’t for those, I wouldn’t have the know how to even set up this blog and write to you today.
With that said, how can you start investing in yourself today?
I’d say it beings with knowing what you are good at, what you enjoy doing, and what does the market / employers pay highly for.
This is a whole other topic. I will be writing a separate post for you later in the future.
Once you find that intersection, you can check out all the free stuff first – podcasts, blog posts, PDFs, YouTube videos, etc before ever investing in a course.
For career driven person, I’d highly recommend learning the skill of job hunting. This skill alone was what allowed to leapfrog the career ladder fast.
I will be sharing more about in later post as well.
—–
So to recap:
Before you invest your RM1000, be sure to
- Pay off your monthly payments first
- Save first.
Once you’ve done that, you can consider investing in
- Low cost index funds / StashAway
- Real Estate / REITS
- Yourself (specially high income skills)
If you enjoyed this post, join my weekly email and be the first to read my latest blog posts when they come out.
Lorax ismindeki mızmız kahramanımızın hikayesi… Michal Lindley
Küçük bir liman kasabasında, şiddetle bir doktora ihtiyaç vardır. Bu sayede bir fabrika ile anlaşma yapabilirler. Doktor Paul’u bulduklarında ise, eğlence başlayacaktır Jerome Wyse
Seth Green, Matthew lillard ve Dax Shepard bu çılgın komedide, yolları uzun zaman önce ayrılan çocukluk arkadaşlarını canlandırıyorlar. Ancak ekibin yolu, grubun dördüncü üyesinin ani ölümü üzerine tekrar kesişecektir. Cedrick Gorlich
Söz yazarı Catherine Brown’ın hayatı paramparça olunca, Woodstock’ta ailesinin yanına taşınır. Burada geçmişiyle yüzleşecek ve gerçek başarının en başta kendisi olmaktan geçtiğini anlayacaktır. Winston Gurtin
Acaba bu üçlü bizim dünyamıza geri dönebilecek ve Dr. Rick Marshall bu keşfiyle sıfırdan bir kahramana dönüşebilecek midir? Jamar Lavagnino
Danimarka’nın küçük bir kasabasında, 2007 ve 2012 yılları arasında yaşanan 79 intihar ve ardında yatan gizem, belgesel yönetmeni Jeppe Rønde’nin dramatik hikaye anlatımı ile birleşerek, sıradışı bir dramaya dönüşmüş. Filmde, Sara ve babası Dave, Bridgend adında küçük bir kasabaya taşınırlar. Kasabada gizemli bir biçimde insanlar, ardından hiç bir not bırakmadan kendilerini asmaktadır. Sara, Jamie adında genç bir çocuğa aşık olur. Diğer yandan polis olan Dave, kasabadaki intiharları araştırmaktadır. Mitchell Morro
Gru’yu tanıyorsunuz! Despicable Me filmlerinin baş kahramanı olan bu kel ve yetenekli kötü adamı en son bıraktığımızda iyilerin tarafındaydı. Büyük bir hata yapıp Balthazar’ı elinden kaçıran Gru için sıkıntılı günler başlayacak. İşinden kovulan ve aile hayatı da sallantıda olanan Gru’nun yardımına varlığından bile habersiz olduğu kardeşi Dru koşacak tabii tek bir şartla; suç dolu hayatına geri dönerse! Bakalım iki kardeş nasıl bir maceraya atılacaklar ve başlarına neler gelecek? Despicable Me 3, 30 Haziran’da vizyonda! Kelley Norstrom
Ailesiyle ve işlerinle ilgili problemleri olan bir adam. Gene hepsinin üst üste geldiği bir günde biraz kafa dinlemek ve birşeyler içmek için bara gider ve barda birisiyle tanışır. Tanıştığı bu kişiye içini döker, dertlerini anlatır ve bir müddet sonra dost olurlar. Ancak bu yeni dostunun profesyonel bir katil olduğunu bilmemektedir. Bu dost(?) ölmesini istediği 5 kişinin ismini bir mendile yazmasını ister. Bunların aslında bir şaka olduğunu zanneder ve isimleri mendile yazmıştır. Fakat düzeltemeyeceği bazı şeylerin olacağını henüz anlamamıştır. Bu listedeki insanlar birer birer ölmeye başlayınca işin farkına varır ve bunun önüne geçmeyi ister. İyi seyirler dileriz… Edgardo Bai
Nir özel tim ekibi gizemli bir VHS kasetini araştırır. Uğursuz bir tarikatın elinde tutuğunu öğrenir. Kirby Roel
Bulaşıcı bir virüsün insanları kana susamış mutantlara dönüştürmeye başladığı bir ortamda, Marco ve Sonia mutantlardan korunmanın bir yolunu ararken, Marco da virüsü kapar. Oren Wical
19 yaşındaki Tish ve 22 yaşındaki Fonny birbirlerine çok aşık olan genç bir çifttir. Bu tutkulu aşk ikiliyi zorlu ailelerinden ve dış dünyanın acımasız yüzünden korumaktadır. İkili nişanlanır ve kısa süre sonra Tish hamile kalır. Çiftin önünde ailelerini planlamak ve huzurlu yıllar geçirmek için güzel bir fırsat vardır. Ancak günün birinde dünyaları tepetaklak olur. Fonny haksız yere Porto Rikolu bir kadın olan Victoria Rogers’a tecavüz etmekle suçlanmıştır. Şimdi Tish, ailesi ve avukatı, Tish’in karnındaki bebek doğmadan önce Fonny’i serbest bıraktıracak kanıtı bulmak için zamana karşı yarışmak zorundadır. Victor Cartland
Thanks again
Greetings! Very useful advice in this particular post! It is the little changes that will make the biggest changes. Thanks for sharing!
I may need your help. I tried many ways but couldn’t solve it, but after reading your article, I think you have a way to help me. I’m looking forward for your reply. Thanks.
Good post. I learn something totally new and challenging on sites I stumbleupon on a daily basis. Its always useful to read content from other authors and practice something from their websites.
Good article!