Long Term vs Short Term

This has always been a subject of discussion when I talk to people about building their long term wealth or the "Golden Goose".

The main idea is to have your money work as hard for you as you do for it. Our mission should be to save and invest rather than to spend it all. And this is a skill which we have to choose to develop, the rich skill and the poverty skill. It's may sound like a funny way of describing it, nevertheless it holds a lot of truth.

Rich skill is to have a lot of money and spend a little, while the poverty skill is having a little and spend a lot.

So long-term versus short-term, lets put it in simple terms: Poverty skill: people work to earn money to live today.
Rich skill: work to earn money to pay for investments, which will pay for the future.

Financial Freedom

The great debate!

In his book "Secrets of the Millionaire Mind" T.Harv Eker said when it's comes to the money game, most people don't have a clue to what it takes to win. That got me thinking and I read on to discover a unique blueprint that can easily be understood and applied.

His definition of financial freedom is simple: it's the ability to live the lifestyle you desire without having to work or rely on anyone else for money.

The desired lifestyle would cost money! Therefore to be "free" you will need to earn money without working. To win the money game, the goal is to earn enough passive income.

Two primary sources of passive income.

1. Money working for you.
This includes investment income from your stocks, unit trust, ASB as well as owning properties or other assets that appreciate in value and can be liquidated for cash.

2. Business working for you.
This means generating an ongoing income from a business where you do not need to be personally involved. WOW...that means the business must have it's systems in place. Of course, you need to build it up first...but once that is done...passive income comes in.

So by choosing business opportunities that immediately or eventually produce passive income, you'll have the best of both worlds - working income for now and passive income later.

Now, go have fun building up your investments and that business...just make sure that it's got the passive income structure. Good or good?

Buy America. I Am.

This is an extract from the text of an opinion piece written by Warren Buffett and published in the New York Times on Friday, October 17, 2008:

In his opening remarks this is what he said.

The financial world is a mess, both in the United States and abroad. Its problems, moreover, have been leaking into the general economy, and the leaks are now turning into a gusher. In the near term, unemployment will rise, business activity will falter and headlines will continue to be scary. So ... I’ve been buying American stocks.



This is some of the points, in summary of his reasons why.

1. A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful.

2. Fears regarding the long-term prosperity of the nation’s many sound companies make no sense. These businesses will indeed suffer earnings hiccups, as they always have. But most major companies will be setting new profit records 5, 10 and 20 years from now.

3. I can’t predict the short-term movements of the stock market. I haven’t the faintest idea as to whether stocks will be higher or lower a month — or a year — from now. What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up.

4. Bad news is an investor’s best friend.

5. Equities will almost certainly outperform cash over the next decade, probably by a substantial degree.

So there we have it, Mr Buffett's strategy. He's buying America. Question ... who are you buying?

You can read the full article at New York Times.

If you want further elaboration, you can also see what our team member, Mr Techno Lim has to say. Just click here to go to his blog.

A day in history

Look at the picture closely. Do you see any resemblance? Is it the same building? What differences do you notice?

What's with the financial bail out's?

In the 1998 Asian Financial Crisis, the Malaysia Government made a significant stand to "bailout" and even peg the RM to USD. The respond from the other side of the world was that this is unjust and not a practice of "democracy".

Then we ask the question as to how this current financial tsunami happened? How can big companies like AIG go bankrupt and need UD$85 bil bailout or how did the world's fourth largest investment bank, a 158 year old giant, Lehman Brothers end up with US$660 bil in debts?

So now when the other side of the world has a financial crisis and suddenly has to fork out a US$700 bil "bailout", what do we say?

I am of the opinion that we will always do this, first for self, family, company, community, country.

If this holds true, shouldn't we be focused on our situation first and shouldn't we be the ones taking responsibility and pride to ensure that the local stock market, financial sector and economy and even political stability be our priority?

What would your comments be I wonder?

Malaysia BOLEH...! or ?

LVG Launching

Thanks to Berita Harian for publishing LVG Launching. Congratulations to the partners, Nash and Jash for such a memorable event.

What would the trend be in Malaysia ...

It's interesting to look at how matured market like the United States have grown in the mutual fund industry. Just have a look at some of the statistics.

As at end of 2007, the United States has US$12 trillion (RM36 trillion) worth of assets under management, Malaysia on it's private sector unit trust has about RM70 billion. The US has more then 8,000 funds and Malaysia has about 500. There are more funds available in the US than there are stocks on the NYSE.

How will this trend affect the local unit trust industry? Will it create more opportunity, will we see more funds being introduced, will the fees be going down further? Well, as I am not one of those futurist, what I can say, as far as learning and experience ... the best is yet to come.

Thanks Eddie...

Eddie is one of our senior consultants at LVG Consultants. Thanks Eddie for your contribution on the 4-Step Success Strategy:

1. Journey (or time period)
Unit trust investment is not meant for short-term gain. The recommended time period is three to five years.

2. Discipline
Consider investing regularly. This way, the investor rides both the ups and downs of the market to optimise their returns. This investing strategy is known as “Ringgit Cost Averaging”.

3. Monitoring and review
Engage a professional consultant or advisor who can constantly keep you updated with market developments as well as your investment portfolio. The advisor should offer a solid investment
strategy for the medium to long term period.

4. Taking action
Decide in advance what action must be taken when:

• the investment returns target is met
• market conditions indicate change, either for an upturn or downturn
• your risk profile changes
• your financial goal changes

A classic .... do you agree?

This to me is one of those classic newspaper headlines. It poses the question can you retire? It's an interesting article with very staggering statistics. But sad to say, just next to the headline we see that Malaysia is celebrating it's 5o years of independence! Well my assumption is that the country's independence does not equal an individual's financial independence.

Well, I guess there's not much to write about, my work needs to carry on. May we build upon our vision of building a financial fortress in every home. Possibly we can change that heading to "Most Malaysians are well on their way to financial security & independence"

Planning for the kids education funding

Recently I met a few people who wanted to start their children's education funding program. So I asked them how old their kids were and almost all did not answer "newborn" baby. Why I want to highlight this is because if your kids is already one year old, what did you do for the last one year for him or her.

It's funny to me sometimes to think that we all read and know about the importance of education, we also know that the prices are not coming down, so what more does it take to just get started on the savings. My guess is, it's a long way to go right! 18 to 20 years from now is a long time ... are you sure. Don't get caught.

I got this idea from one of the books I read. The way to plan for the long term, is to not call it long term ... but rather a few short months. For example, for a 5 year plan, call it your 60 short months plan. If you start doing this and implemented it on paper ... i can bet you see results.

When I implemented this idea, I got sick to the stomach to realize how much time I have wasted. More like, how many years that is. You see, once you quantify it into monthly blocks, you can see it very clearly and it stares right back at you, if you don't do anything.

So now for me planning has become easy. Well, at least the planning part ... implementation is another skill to be mastered. So back to the question of wanting to start that education or college fund for the kids. Let's just take my examples this time round.

I've got 3 kids, Amira is 10, Amir is 7 and the last girl, Aldelia is 5. Now lets say we plan for Amira. She's got another 8 to 9 years before she comes to me and ask for that money I promised for her to go to college. I sure am going to feel pressured and I want to be able to tell her .... ok darling.

So say 8 years, still quite a long time. Now you break it to months ... it's only 96 short months. Oh man! Now with that you draw up in an excel spreadsheet and line up the boxed and put it at a visible place. Every month that you put aside the money, you can cross off the box. Now you can not only see it, but feel how you are progressing each month. Believe me it is effective.

Financial planning may seem like a complex subject with the stock market, unpredictable returns, complex products and so on. But the bottom line is this my friends ..... it's not how much you earn, it's how much you put aside for the later use of those money. That's basically the basics. Then we can talk about the complex structures and returns.

I do hope all of you will get started with this simple idea.

Do you see more months or more money at the end of the months.

Humanizing Insurance & Takaful

When eTiQa launched the new branding with it's value proposition to "humanizing insurance", some people may have questioned what it means. It is really about going back to the basics and the core foundation of the insurance business, which is people. It is the reason we exist and it is also the reason why we must progress to strengthen this core value.

Yes, the insurance industry has been under attack for many years and has carried with it a "perceived" bad connotation to both the industry and it's people. Little do we realize that this industry has been around for a very long time. It has survived the test of time because for one, insurance companies are very conservative. But that alone is not enough. Insurance companies must honor the contracts with it's policy holders. If this does not hold true, how long would an entity be able to continue as a going concern. Yes, maybe there is very little publicity when claim are paid out. But there are reasons behind this. As you may imagine, not many families want to announce such a sensitive situation. Imagine the devastation ones family goes through. Even with a claim that comes in to elevate the situation of the family, having it publicized would be the last thing on their mind. Wouldn't it be the same for you?

Making a difference

It's not how much you accomplish in life that really counts,
but how much you give to others.

It's not how high you build your dreams that makes a difference,
but how high your faith can climb.

It's not how many goals you can reach, but how many lives you can touch.

It's not who you know that matters, but who you are inside.

Believe in the impossible, hold tight to the incredible, and live each day to its fullest potential.

You can make a difference to your world.

RM 1,000,000

Why do I need a one million dollars insurance cover? This is often the question posed to me every time they ask me to recommend them with the appropriate amount of protection.

My immediate respond ... why not? Would you be interested in a property worth a million ringgit instead? Of course is usually the answer.

Well, lets do a simple comparison. The scenario is a based on a 40 year old CEO whom I met recently.

Say you bought a property worth RM1.0 million and you got an excellent deal from the bank giving you a 100% loan at 3.5% interest with a tenure of 25 years. (question is can you get these kind of rate?)

The monthly installments would be RM5,006.24. Now the total repayment amount that you would have paid to the bank after 25 years would be RM1,501,872. Take this amount and minus the RM1.0 million that you borrowed, thats the amount of profit you would have passed on to the bank! Of course, one would hope that the property value would have sky rocketed in that time ... but to how much? That would be a different discussion, for now we just do a simple comparison.

Lets just get this out in the open. Insurance or Takaful is just a financial tool with the objective of transferring the risk that we would otherwise have to handle ourself. However, with the right kind of product, you can maximize your dollar value tax efficiently.

For example, a RM1.0 million insurance or takaful policy would be around RM9,000 to RM30,000 per year, depending whether its a pure term, composite term or a term with mudharabah (profit sharing). Here, we're not discussing how much return we get, but consider this for a moment.

1. The contract is under your name. You have FULL ownership of the RM1.0 million, whereas the property is under the banks ownership until the loan is fully settled.

2. What would happen if you were suddenly incapacitated and not able to payoff the loan? Well, someone will have to pay for it or the bank will assume its position. So then he said, I can buy MRTA. Well, isn't that insurance? Of course the calculation above did not take into account MRTA, because then the figures would increase. But why do you want the MRTA? Yes, the policy would payout RM1.0 million to your family, whereas the property will need to go through the process of estate administration, assets realization and distribution. How long will this take?

3. Lets compare the expected profit you can make at the end of it.

The Takaful program.
Annual premium RM32,000
Total amount deposited RM800,000
Immediate cover RM1.0 million
Maturity value RM1.2 million
Expected profit RM400,000

The Home loan program
Annual repayment RM60,000
Total amount paid RM1.5 million
Contingency cover RM1.0 million (value of the property)
Expected value RM2.0 million
Expected profit RM500,000

Now, having done all this comparison, we can still argue. So I say, it not about one side having to win and the other lose, its not about who's right and who's wrong. At the end of the day, all this need to tie back to your objectives and your opportunities.

As a conclusion, we need time to build wealth, we need time to build the business, we need time time to sort out all the things we handle, but if an unexpected event take a turn in, our family will not have the time. So do take action on what you can ... now!

Market is falling, now what?

In this wake of the political drama after the rise of oil prices and now the turbulence of the stock markets. The world markets are crazy, the outlook is dicey, but there are also plenty of ways to profit, if you keep your cool.

So what can I do? Do I sell my funds? Do I buy? I have butterflies in my stomach….

Here's some quick tips:

1. Focus on you're a long term goals and practice dollar cost averaging.

2. Use the buy-and-hold principle, the funds will generate reasonably good returns over the medium to long term.

3. Don't time the market, as we will be exposed to much higher risk.

4. Practice of portfolio allocation or asset allocation will give us potentially higher returns whilst reducing our risk.

For further information, do read this excellent article on how you can keep your cool in a volatile market situation.

http://www.publicmutual.com.my/page.aspx?name=art_remaincalm_pg01

The meaning of what we do

Tonight I went to visit a friend who was recently involved in a car accident. He was hospitalized and had gone through quite a major surgery on his back and now he's got two metal piece and eight titanium screws on his spine. Alhamdulillah and thankfully he's now alright and he's even able to move about only after a week, albeit with the assistance of a back support. The doctor says that he will recover pretty soon. Rest well and bounce back my friend.

However, it is incidents like this that makes me look back and remind myself the meaning of what I do. It is difficult in our business to see the value of what we do. It's not like physical things or products that you can see. How do you prove things like faith, how do you prove you're good? How do you prove the miracle of your product and the quality of the company you represent?

If you try to do it with proof, you lose! But when it's in your heart, when you believe in yourself, believe in this business and believe in the miracle of your products and the company you represent. Then you can look at people in the eye and believe me, a lot of people have told me that I can do better somewheres else, and I can look them right in the eye and say you're wrong.

But it's not easy is it! How do you feel, when people say ... you're an insurance agent !! puuiii ... they spit at you!!

Do we realize, that it is us that creates the vacuum, that gets people to act. It's not the knowledge! There are plenty of books and references that provides us all the materials. What do you want, financial planning, education, retirement. The theory is all there. It's not about the knowledge, but it's what you do!

Do we realized that if people don't DO something that they can't retire with dignity when they're 65. If they don't DO something, their family will be exposed to a high degree of risk. If they don't DO something, they may have to re-finance their home for the children's further education.

What a gift, when we have the chance to do more for the average person compared to anyone one else! We are in a position to help create and secure that DO! When I deliver a death claim, the lawyers are there charging a fee, the accountants are there charging a fee. And I give them a cheque for a million ringgit, and I'm on defense? I got to apologize coz I'm an insurance person!

If you don't believe that, you lose!

MDRT Day 2008

2nd August 2008. I had the opportunity to take a snapshot with Mr. Walton W. Rogers, The Current President of MDRT. During his session on the MDRT Day 2008, he address the audience and shared valuable information.

One area that I like was the "Whole Person Concept", which I feel is the fundamental areas if we want to find the balance and also significance if we are a practitioner in the financial services industry.

The "Whole Person Concept" outlines the following seven areas of importance for us to find the right mix and balance.

1. Career
2. Education
3. Family
4. Finances
5. Health
6. Service
7. Spirituality

Hopefully as we go through our daily work and personal life, we do take some time to think about what is really important to us and find that balance in life.

If you want the materials from the MDRT Day 2008, leave a comment on the blog and type "request materials". Be sure to leave your full name and a valid email address for me to send it to you.

Have an awesome week ahead.

Seeds of Greatness from Dennis Waithley

I had the opportunity to meet this extraordinary person on 29th March 2008 at the KL Convention Centre.

This paragraph is taken from his book that I read called the seeds of Greatness.

Living is Giving

Living is giving your best self away
Living is helping someone every day
Living is giving more than you get
It's treating an animal like a person, instead of a pet

It's helping the handicapped across the street
It's smiling at the new person at work that you meet
It's the respect for all notions, color and creeds,
It's sharing and caring for your neighbor's needs

Losers keep betting that living is "getting"
But there's one of God's laws that they keep on forgetting
And this is the one you can live and believe
The more that you give, the more you'll receive!

Winning an award

What does winning the Morningstar award mean?

My first question was what's Morningstar? So like the usual inquisitive me...I went on to do my research.

Morningstar Asia, established in April 2000 is a wholly-owned subsidiary of Chicago-based Morningstar Inc. It is a leading independent provider of investment information and analysis for mutual funds and stocks in the US.

Maybe it counts for something, maybe it doesn't, it's in fact a matter of opinion. My simple opinion, quite simply is like buying a new hand phone, car or computer. We do a survey from various sources, the internet and some leading magazines. An of course if the budget permits, we always want that recommended item, the 5 star rated review. So for me in the complex enough world of investments and stock picking, I can be satisfied when there are experts out there who's conducting extensive research, data analysis and top it with a review and ranking of the possibly good potentials. Of course there are no guarantee that past performance is an indicator of future achievements. Well such as life, at least I'm making my choices on some fundamental data that I can be satisfied with in making my investments decisions.

You can read and download a write up on it at my company link.

Investing 101: Success in the stock market

In the recent months, I had the opportunity to meet a lot of people who have made investments through mutual funds, either via their EPF or cash investments. I have received positive as well as negative remarks on both the market as well as the funds performance…well not to mention a little spice on politics.

So I took the initiative to put together this summary from various materials, some I’ve read, some I’ve done research on and also some good pointers from those ‘sifu’ in the investment field. I hope it would assist in some ways for those interested.

So let’s get this right …. investing is a passive process. It does not involve active buying or selling of products or services. It is simply a process of buying and selling of passive financial instruments such as stocks, bonds, fixed deposit certificates, mutual funds and etc.

Now let’s explore the myths and realities of the stock market. For starters there are 985 listed companies on the KLSE and 494 private unit trust funds to choose from, and the numbers are not stopping there (figures as at Feb 2008). Imagine the amount of data that keeps on changing every minute of the day. So this is the truth, we can’t know it all so let’s not even try. I’m sure you don’t want to go through the overwhelming amount of data just to make that initial investment. Not to worry, we need to focus on three simple tasks.

1. Filter – which stocks/funds to buy?
2. Time in – when should I buy?
3. Time out – when should I sell?

Heard this before? Some people I know have already began practicing this approach to investments, but it’s not actually what it sounds like …. I know of many people who talks about timing and predicting the market. This is not what the three tasks are about.

I hope this information that I’m about to share will make you more confident and create your own success in investing. First of all, let’s get rid of the notion “beat the market”. There are not many people like the stock genius Warren Buffet, or Peter Lynch or Sir John Templeton. In the history of the world financial market, there are only a tiny number of these superstars, out of millions who have tried, many have failed. Just imagine 75% of the smartest fund managers, working 20hours a day, backed by huge research team, powered by advanced computers have never been able to beat the market consistently.

I’m not even suggesting that we try to beat the market, but needless to say, we can make money through investing. It’s one of those surest ways in the long term to add the extra million or two. Here’s a summary of what I’ve learned and applied myself.

1. For an unsophisticated investor like me, my no-brainer approach is to carefully select a few index based mutual funds and forget about them. So if you ask me which stock/fund to buy, I’d say all of them! (pick some good one’s based on track record, your risk appetite and the fund strategy that meet’s your understanding and objectives)

2. The sooner you buy, the richer you can become. Take 10% of your monthly savings and put it away into your chosen funds. Do this without fail for the rest of your life. Most of us don’t have lump sum amounts of money lying around, so my choice is force myself to set aside the amount on a monthly basis. When you invest a fixed amount every single month for a long term period, we’re actually practicing a rather sophisticated strategy called dollar cost averaging.

This strategy works only if we continue to buy – especially during the bad times – and hold on until the good times return. If you stop buying during the bad times, you lose the advantage when things rebound. In the book multiple streams of income, Robert Allen says that the numbers one reason the dollar cost averaging is so powerful is that it completely eliminates the need to guess when you should buy. It takes away the need for “market timing.”

3. The longer you invest, the lower the risk. You can always win if you just hang on long enough. Investing must be for the long term. Speculating will just actually increase the risk, not to mention the heartache and stress. If you want to invest your money without risk, take a lesson from the best stock picker in history. Warren Buffets said “My favorite holding period is …forever”. Well I guess that’s why he’s a billionaire. So when do you sell? Like maybe 20 to 25 years time. Especially through the EPF, you can’t use the money until 55 anyway. So let it earn a little bit more than 5%. Do you know how much another 5% will do towards your EPF funds? Well, that’s gonna require you to sit down with me and go through a simple exercise using a powerful financial software…just remind me when we meet next.

So as a summary…

• Start investing immediately
• Select funds that you understand and like, simplest way to invest in the market.
• Dollar cost averaging is convenient and smart for most of us.
• Long term investing is far less risky than short-term investing.

Hope you are able to get a good nite sleep after reading this and if you want any specific information on mutual fund investments, please contact me directly.

January 2008 Unit Trust Industry updates

History in perspective

It's interesting to look back into history when the KLCI hit rock bottom during the Asian financial crisis. I just came back from studying overseas and had started work middle of 1997. That period was one of the most valuable experiences for me. I must say it was like the stock market, a lot of ups and downs. I'm just wondering today if I had bought some shares then how much would it be valued at today. Interesting!

Estate Planning

In this Volume of MDRT newsletter, the topics discussed is estate planning, teaching financial values to children, debt management basics and dual income families.

If you want to receive the full articles or other MDRT newsletter series, please send me an email.

Don't mess with your insurance

Buy term and invest the rest and you could reap better returns from your investments - so some financial planners tell me. I have a slightly different opinion. Yes, investing in investment link funds or stock related insurance instruments do have it's advantages. We have to understand that the stock market will go up..and will come down...period. As a rule of thumb, investing must be for the long term and it's for a different objective. It is for accumulation of wealth not for protection of the family's well being. During a financial crisis when markets are low, a lot of people will start conserving their cash and also sometimes tempted to liquidate their investments. Stay calm, the market will recover in its natural course. More importantly don't mess with your insurance.

Having traditional insurance or endowments plans allows one to use the cash values to pay for premiums, a term commonly use is "premium holiday". It is logical to do this as these plans are usually more expensive (can easily be triple what you pay for a term plan) and since you want to conserve the cash that you have, you may opt for a premium holiday.

However, having a term insurance with normally lower premium means higher cover, so during financial crisis what do you do? Well, there are various options. During this times, I usually find that people are more willing to surrender their insurance plans as compared to selling their car. Why, because you need the car for your various use. If using a car is for the purpose of transport, there are plenty of options to go by...sell the beemer and get a kelisa for example. To me, the answer is just in our ego. This is just a temporary setback...that's life. Surrendering the insurance plan should be the last thing on your mind. It's during times likes these that we are under more pressure and stress. Ensuring that your risk is well managed is probably the best thing you can do, so that you have that peace of mind while going out in the market and sourcing out opportunities.

The point is, is your financial plan only good for sunny days? Can it withstand the storms in your life? Remember, our financial goals will only be realized in 20 to 30 years time. During this period, the financial landscape will be ever changing. Boom times and sunny days will come, so will recessions and stormy days. In financial planning, the mistake that most people make is to assume that the sun will always be shining. Unfortunately, life is full of ups and downs.

As important as it is to invest your money efficiently, it is also crucial that you set aside part of your resources for the right insurance plan so that when the storm comes, you will not be swept away.

Mohd Affendy

Fendy has been with the team since 2006. He now provides consultation on the areas of unit trust, insurance and also Islamic inheritance planning.

Fendy can be contacted at:
Mobile 019-388 5254
E-mail: affendy.partner@gmail.com

Darul Amir Hazim

Darul has been with the team since 2005. He's our specialist in the area of risk management. His area of service is on insurance and takaful, covering the areas of group insurance, personal and medical insurance.

Darul can be contacted at:
Mobile 016-395 4545
E-mail: darul.amir@gmail.com

M. Jamil Ali

Jamil is one of our senior associates and has been in the financial services industry since 1996.
He is a certified Islamic inheritance planner and also specializes in the areas of business insurance, risk management and wealth advisory. Jamil and his team operates from his office in Cheras and also Muar.

Jamil can be contacted at:
Mobile 012-289 2366
E-Mail: m.jamil.ali@gmail.com

Find out more about Jamil, visit his personal blog.

Norhayati Zakaria

Yati, is one of our senior associates and partner in the Southern Region. She has offices in Muar, Johor and Melaka. Yati and her team specializes more on insurance and takaful, both for life and general.

Yati can be contacted at:
Mobile: 019-3106979
E-mail: ihaagency@yahoo.com

Al Jazzura Khan

Al as he prefers to be called is the founder and managing partner of renbridge financial group.

He was trained as an accountant and worked in the areas of corporate advisory, investment monitoring, mergers & acquisition during his tenure with a venture capital company.

Started out initially as just an insurance agent in late 2000, he had successfully build the business to include many other areas such as mutual funds, general insurance, will and trust, business insurance as well as financial literacy talks and training. He achieved the prestigious professional award, MDRT in 2004.

He specializes in working with entrepreneurs and business owners in the areas of business succession planning and business insurance.

He also pen's down his thoughts, ideas and personal experiences on his personal blog.

Why Build A Financial Fortress

I believe each and everyone of you have your own dreams and reasons for wanting to build wealth.

Here I share some of my reasons why I want to be wealthy.

First, I wanna have fun.
The kid in me always wants to have fun. I always remember mom or dad asking me to behave and as a reward for behaving I get a toy ... wow, that was fun. Maybe you have reached your peak in building your wealth, so as a reward you can buy the toys that you want, great. Should you wear a RM30,000 watch? Should you drive a RM668,000 car? Should anyone live in a RM800,000 condominium? Of course the should. The problem is that a lot of people buy into all these things when they can afford it. Been there, done that.

So I am now in the process of building my financial fortress. Yes I do have money still, but I don't yet have a fortress to back me up. When your money makes more than you do, you are officially wealthy.

So go buy that new watch. Buy her that diamond ring. Buy that new M3 and move into that brand new bungalow. You can do all this when you have millions of ringgit. Take the family and extended family for a holiday overseas, and don't feel bad about it, because money is to be enjoyed. I think that is a good enough reasoning for the kid to want to build wealth.

Second, I wanna have a profit account.
The adult inside me likes to make investments, because this part makes me wealthy. But here's the deal .... have you ever played monopoly or the cashflow game? Just like that, you can be ahead or you can fall behind. Exactly like the stock market, it fluctuates ... so what do we do? I am not a stock analyst neither am I a spot trader. I just ride the waves and stay in for the long term. That's what building a financial fortress is all about.

In meeting people, sometimes they fear that they might make a loss in their investment. I often tell them that "timing" or "buy low sell high" is not the formula to wealth. You must be "positioned" properly. If you have quality investments with good long-term track records, then you are in a position to make profits. Another key is continuous and consistent investment, to ensure our nest egg grows. Besides, I don't need my nest egg all at once to retire on, I just need the income from it. So it would be silly to cash everything out while the market is at the bottom. We need to be patient with the market, there is always a correction, what ever goes down will come up.

Unless you are a sophisticated investor and have more than RM10.0 million, I would keep investing very simple. I don't want to clutter my life with a list of extremely complex investments that leads to unnecessary stress. I have chosen to use simple mutual funds and other paper investments - very clean, simple investments with some basic tax advantages. Once this side of my financial fortress is done, I will go into some debt-free real estates, that should be fun.

Pelabur Wanita: Menguasai Dunia Kewangan

posted by ASG

Sudah berlalu zaman di mana wanita hanya bergantung kepada lelaki bagi mempunyai masa depan kewangan yang terjamin. Mereka sudah mampu mengurus hal-hal berkaitan wang mereka sendiri tanpa bantuan sesiapa. Wanita dalam setiap posisi kehidupan – bujang, berkahwin, janda, pekerja sepenuh masa, suri rumah – kini memainkan peranan yang penting dalam menguruskan kewangan mereka sendiri dan juga keluarga masing-masing – dan mereka berjaya.

Sudah diketahui ramai bahawa lelaki dan wanita berkomunikasi dalam cara yang berbeza – bahkan mereka bagai datang dari dua planet yang berbeza sebagaimana yang disebut dalam legenda moden – dan ini juga benar dalam aspek pelaburan. Menurut beberapa kajian, wanita sebenarnya adalah pelabur yang lebih baik daripada lelaki. Dalam satu kajian yang dikendalikan oleh Universiti California dalan jangka masa dari tahun 1991 – 1997, portfolio wanita memperoleh 1.4% lebih tinggi daripada portfolio lelaki. Dan wanita bujang memperoleh pulangan sebanyak 2.3% lebih tinggi daripada lelaki bujang. Malah, kajian itu menunjukkan bahawa keseluruhan jumlah pelaburan yang terkumpul bagi wanita mengatasi kaum lelaki sebanyak 4.6%.

Apakah punca yang mendorong kepada fakta yang kurang diketahui ramai ini? Kebiasaannya, tanggapan ramai orang yang melibatkan wang dan pelaburan ialah wanita lebih cenderung untuk menjadi lebih curiga, kurang keyakinan diri, dan membuat keputusan berdasarkan pengalaman peribadi. Ini seterusnya akan mendorong kepada kadar pulangan yang negatif. Namun sebaliknya, wanita kelihatan lebih maju ke depan berbanding lelaki apabila mereka mempergunakan sepenuhnya kelebihan mereka.

Secara keseluruhannya, wanita cenderung untuk mengambil kurang risiko daripada lelaki dalam pelaburan. Kesannya, mereka tidak terlalu kerap meniagakan saham mereka, dan membuat wang simpanan atas kadar yuran transaksi. Wanita juga lebih gemar membuat kajian yang menyeluruh terhadap pilihan pelaburan yang ada berbanding terus memilih saham yang sedang naik di pasaran. Pengalaman peribadi dalam membeli dan kualiti produk juga akan mendorong wanita untuk melabur dalam syarikat tertentu. Sesetengah sifat ini mungkin dianggap negatif, namun faktor ini juga sebaliknya dapat membantu wanita untuk memilih saham atau jenis pelaburan yang lebih stabil dan berjangka panjang.

Corak kesedaran kewangan dan pelaburan bagi kaum wanita telah menunjukkan perubahan mendadak sejak zaman nenek kita, bahkan mungkin sejak zaman ibu kita mula berfikir tentang masa depan kewangan peribadi mereka – itupun jika mereka melakukannya. Secara tradisi, urusan kewangan keluarga berada di tangan lelaki, namun hari ini sudah banyak wanita yang menguasainya.

Menurut Pusat Kajian Wanita Dan Persaraan Keabangsaan, 80 – 90% wanita akan memiliki tanggungjawab peribadi dalam menguruskan kewangan mereka apabila mereka mencecah tempoh usia tertentu. Ini disebabkan oleh kematian suami, perceraian atau keputusan mereka untuk kekal membujang. Sekarang adalah masanya untuk menyediakan diri anda sendiri dan meraih keyakinan terhadap masa depan kewangan anda.

Anda boleh hubungi perunding-perunding kewangan bagi membantu anda ke arah kejayaan matlamat kewangan anda. Pastikan anda bertanya mereka akan hanlangan-halangan yang disebutkan seperti di atas dan apa yang boleh anda lakukan bagi mengurangkan jurang tersebut. Bincanglah tahap kesediaan anda untuk mengambil risiko yang lebih tinggi dan lebih banyak pilihan pelaburan yang stabil. Tetapkan matlamat kewangan yang realistik (menjelaskan hutang, membeli rumah, atau membiayai pengajian) dan tempoh masa, dan dapatkan nasihat daripada perunding kewangan anda dalam mendapatkan cara terbaik bagi mencapai matlamat anda. Ingatlah bahawa pelaburan ialah satu proses jangka panjang dan adalah penting untuk anda meneliti matlamat kewangan setiap tahun, memandangkan matlamat itu mungkin berubah seiring dengan masa.

Anda tidak pernah terlewat untuk bermula menabung dan melabur sekarang. Langkah untuk menyediakan diri anda sekarang akan memudahkan anda untuk mengatasi cabaran kewangan anda pada masa akan datang.

Wanita dan Kewangan

posted by ASG

Dalam satu laporan pada tahun 2005 daripada Pusat Kawalan Penyakit, secara purata wanita hidup 5.3 tahun lebih lama daripada lelaki. Oleh sebab jangka usia wanita lebih lama, mereka mempunyai keperluan yang lebih tinggi daripada lelaki untuk mendapatkan lebih banyak wang selepas tempoh persaraan.

Langkah bijak yang paling mudah untuk dilakukan oleh kaum wanita ialah dengan memulakan langkah menabung sejak awal dan melabur lebih banyak wang secara agresif. Lebih cepat kita bermula, lebih kuranglah jumlah wang yang diperlukan secara keseluruhan memandangkan dana tersebut akan mempunyai lebih masa untuk digandakan.

Wanita muda juga akan memperoleh lebih banyak kebaikan dengan membeli insurans nyawa lebih awal memandangkan insurans nyawa biasanya melibatkan kos yang lebih rendah pada usia yang lebih muda. Insurans nyawa juga merupakan antara perkara yang tersangat bermanfaat untuk wanita tanpa mengira usia. Wanita yang tidak terpilih untuk menerima pelan pembiayaan daripada syarikat yang disebabkan oleh pemberhentian kerja atau kontrak jangka pendek dengan majikan seharusnya mencuba pilihan ini. Selain menyediakan faedah kepada waris yang masih hidup, orang yang menginsuranskan dirinya adakalanya juga boleh membuat pinjaman daripada sesuatu polisi bagi merealisasikan impiannya seperti membiayai pengajian anak-anak atau memulakan perniagaan.

Antara langkah-langkah lain yang boleh diambil oleh golongan wanita bagi mencapai kewangan mandiri termasuklah:

· Menetapkan matlamat yang jelas. Mungkin ia adalah sebuah rumah impian di tepi tasik atau kondo yang selesa di tengah kota, apa sahaja target yang jelas akan memberikan anda sesuatu yang nyata dan realistik untuk dicapai dan akan lebih mudah menilai usaha yang perlu dibuat bagi mencapai objektif tersebut.

· Memeriksa kedudukan kewangan anda. Perhatikanlah kewangan anda secara kritikal, terutamanya yang melibatkan matlamat hidup anda. Timbangkanlah untuk meminta nasihat daripada orang yang yang sesuai dalam membuat pengiraan kondisi anda sekarang. Ambil tahu apakah pelaburan yang telah anda miliki sekarang dan berapakah jumlah nilaian pelaburan anda.

· Mengekalkan tahap kredit yang baik. Hutang kad kredit telah menghalang ramai manusia daripada mencapai target jumlah wang simpanan mereka.

· Memiliki satu portfolio yang jelas. Pelabur patut memulakan langkah mengumpul maklumat kewangan dan mula menabung. Bahkan sekecil-kecil jumlah wang simpanan mampu untuk membina masa hadapan yang lebih stabil dan kekayaan.

· Insuranskan pendapatan anda. Insurans kesihatan, auto, dan penyewa atau pemilik rumah semuanya penting dan perlu namun timbangkanlah juga insurans keilatan. Jika anda adalah penyara keluarga, fikirkan apa yang akan terjadi jika anda tidak lagi mampu memperoleh pendapatan.

· Menyumbang kepada jenis alat simpanan yang lain. Anda boleh menggunakan strategi simpanan yang ada seperti insurans nyawa, akaun simpanan, CD, bon dan anuiti.

· Memilih khidmat perunding yang dipercayai. Mintalah pendapat daripada beberapa orang yang berbeza dan ingat bahawa nasihat kewangan yang baik memerlukan masa dan kesabaran untuk meneliti segala peluang yang ada dan membina tahap kepercayaan yang membawa kepada keputusan yang baik.

Untuk kedua-dua golongan lelaki dan wanita, adalah berbaloi untuk mempunyai wawasan yang jelas dalam masa hadapan kewangan masing-masing. Ini merangkumi fokus yang lebih baik, mengurangkan tekanan pada hari ini dan hari esok yang lebih selesa dan terjamin.

Our Greatest Wealth

We are born with two eyes in front because we must not always look behind, but see what lies ahead beyond ourselves.

We are born to have two ears - one left, one right - so we can hear both sides, collect both the compliments and criticism, to see which are right.

We are born with a brain concealed in a skull, no matter how poor we are, we are still rich, for no one can steal what our brain contains, packing in more jewels and rings than you can imagine.

We are born with two eyes, two ears, but one mouth, for the mouth is a sharp weapon - it can hurt, flirt, and kill. Remember our motto: talk less, listen and see more.

We are born with only one heart, deep in our ribs, it reminds us to appreciate and give love from deep within.

- Author Unknown

Becoming a giver

''Becoming the hand that gives is better then the one that receives''

"The more you give, the more you get"

I often hear this expression. However, there is another aspect of giving that I don't recognize some times. Giving is a form of energy that not only helps others but creates more for me as the person who's giving. This is a natural law, whether I agree with it or even realize it.

I then apply this on the subject of money. Money is also a form of "energy", or I can also call it a form of "circulation". It needs to flow. Same as electricity, we only receive the benefits when it is flowing. So lets observe this, when I'm selfish, focused on myself and my own interest or even when I'm frighten that I may not have enough, I stop the circulation. We stop the flowing of energy. So I end up blocking or clogging up the pipelines. Thus we make it difficult for money to flow back in our direction.

The way to get the energy to flow back into my life again is simple... just become a giver. Start giving, be generous, pay others well, tip that extra one ringgit. Support a charity, several even better, start giving back into my community and I want to watch what happens!

This is the same with a lot of other aspects in my life. If I want more love in my life, I become the source that gives out more love. Giving and receiving is like the two sides of the same coin.

So now I know that if I want to receive more .... be it love, fun, success, respect ... and yes money, it's no longer a secret. Just give more of it ... simple. Don't worry, the universe works in a wonderful way, and everything I give away will come back to me ... even more.

The concept of "Business Value Protection"

In Malaysia there are basically three types of business structures. It can either be a sole proprietorship, partnership or companies. For companies, it can either be a private limited company or a public limited company.

In this section, we will look into the concept of "Business Value Protection" (BVP), which on a broad perspective, is a concept to protect and preserve the value of the business when a business owner exits.

The idea behind BVP is to ensure a smooth transition and transfer from the outgoing business owner to the remaining or new business owner.

Best Islamic Fund Manager 2008

Public Mutual Bhd again won the “Best Islamic Fund Manager in Asia” Award by the Failaka Advisors for the 2nd consecutive year.

The Failaka Advisors, which is based in Dubai, is a recognized leader in the field of Islamic funds research. The Failaka Islamic Fund Awards stand apart as the benchmark for excellence in the field of Islamic fund management.

Public Mutual’s funds have once again outperformed the benchmarks by the highest percentages. In a market where many clients have demonstrated a preference for Islamic funds, Public Mutual is well-placed to take advantage of this demand. The team of Public Mutual have proven remarkably consistent in managing their Shariah funds and the proof is in their performance. No doubt performance has played a role in their tremendous asset growth.

Public Mutual is the largest private unit trust company in Malaysia, and it manages 62 funds for more than 1,800,000 accountholders. As at 30 April 2008, the total NAV of the funds managed by the company was RM27.8 billion.

Strategy on Building a Financial Portfolio

The financial pyramid concept is also a strategy
on how we build a solid financial portfolio.

Build it from the base, with solid foundation.

EPF Investment

Effective 1 November 2007, EPF under its ”Beyond Savings” strategic initiative has introduced various enhancements to member’s benefit structure in stages. These enhancements are in accordance to the EPF Act 1991 (Amendment 2007) . One of the enhancements is the introduction of the basic savings concept that will be used to determine the minimum sum a member is allowed to withdraw from Account 1 for Investment Withdrawal.

Effective 1 February 2008, members can invest not more than 20% of their credit in excess of Basic Savings in Account 1 in products through approved external fund managers.

A member needs to have a basic savings amount at the predetermined age levels. Amount in excess of the basic savings can be invested in products offered by external fund managers approved by the Ministry of Finance.

For details please refer to our financial representatives.
You can also find out more details from EPF's website at www.kwsp.gov.my

What is "Wasiat"

A Wasiat is a declaration of a person made during his life time with respect to his property or benefit thereof, to be carried out for the purposes of charity or for any other purposes permissible by Islamic Law, after his death. The assets of Muslims who die without Wasiats shall be divided rigidly amongst their heirs in accordance with the Faraid, i.e. the Islamic Law of Inheritance.

Heirs are specifically identified in Islam. A spouse, parents and legitimate children (provided they are Muslims) are never excluded from a deceased’s inheritance. Grand-children, for example, are not automatically regarded as heirs and would benefit only under certain circumstances. Those not regarded as heirs in Islam include, for example, adopted children, illegitimate children and foster parents.

It is, nevertheless, enjoined in Islam, for a Muslim to write a Wasiat and to make a bequest of one-third of his assets to his loved ones , be they Muslims or not, or to charity so long as it is made in accordance with the Syariah.

Bearing in mind what the Prophet S.A.W. said, as narrated by Abdullah bin Umar that

"It is not permissible for any Muslim who has something to Will to stay for two nights without having his Last Will and Testament written and kept ready with him"

For a free consultation on wasiat and asset distribution planning, you can email us at renbridge@gmail.com and one of our associates will get in touch with you.

What is unit trust

Unit trust is an investment vehicle that pools the financial resources of many individual investors who aim to achieve similar investment objectives.

To take a quote from Peter Lynch in his book "One Up On The Wall", "The mutual fund is a wonderful invention for people who have neither the time nor the inclination to test their wits against the stock market, as well as for people with small amounts of money to invest who seek diversification."

However, having said that, it does not mean you take whatever offer that comes your way. It is equally important to work with a trusted adviser and understand the risk and rewards associated to investing in mutual funds.

Individual and Famillies

Investment products
Whether saving for your child’s education, planning a vacation, building up capital or managing your finances during retirement, we provide you with the right financial tools to create an investment portfolio that fits your needs.

Mutual funds
A significant component of most investment portfolios, mutual funds may fit into your financial portfolio. Mutual funds allow individuals to pool their savings in a diverse portfolio of investments managed by professional fund managers.

Investment linked policies
Investment linked policies are long-term investments that offer capital guarantees. By pooling money from thousands of investors, professional investment managers invest in a variety of individual securities. Since they’re only available through an insurance policy, investment linked policies have several features and benefits that make them different from mutual funds.

Insurance products
Along with helping you build and manage your investments, we help you choose insurance products to minimize financial risk to you and your family.

Individual life insurance
Having the right life insurance protection can make a huge difference in your life, and the lives of those close to you. A financial portfolio that includes life insurance can ensure you leave your estate financially secure, and avoid debts and an inadequate income for your family.

Disability insurance
Accidents and illnesses are unfortunate facts of life. Disability insurance coverage is designed to help protect your most valuable asset – your ability to earn an income, which can be jeopardized if tragedy strikes.

Critical illness insurance
A critical illness or condition, such as heart attack, cancer or stroke, can turn your life upside down. It can affect you physically, emotionally and financially. Insurance can protect both you and those close to you from the financial effects of a critical illness.

Hospitalization and surgical insurance
Health care cost have been rising every year. A good insurance cover to provide for hospitalization and surgical is no longer a luxury but a necessity. We play a role in assisting you to start a plan that supplements your current hospitalization plan.

Banking solutions
Many people don’t realize daily banking needs is forms part of their long-term financial portfolio. With the right banking products, you can have the potential to get your money working harder and smarter.

Banking products and services, provided by Maybank Group, include:
1. Bank accounts
2. Personal loans and overdraft facilities
3. Credit cards
4. Mortgage
5. ASB investment credit facility

Business Owners and Corporations

Protecting your business
You’ve worked hard to build your business, let us help you protect it. Whether starting a new venture or running a successful one, we assist in the areas of:

1. Life insurance
2. Disability insurance
3. Critical illness insurance
4. Directors & Officers Liability

Protecting your employees
Your business is unique, and so are your people. Whether you have 3 or 35 employees, we assist in providing comprehensive group benefits plans to help you protect and retain your valuable staff:

1. Employee benefits for small business
2. Health-care and Hospitalization benefits
3. Life and accidental death and dismemberment benefits
4. International medical assistance

Banking solutions
Providing the right banking products, integrated in your overall financial security plan, can provide the potential to get your money working harder and smarter.

Our financial representative will assist you to identify your long-term goals and new ways to save money, sharing with you powerful wealth and financial strategies to position you to achieve your financial security goals sooner.

Banking products and services, provided by Maybank Group, include:
1. Bank accounts
2. Business loans and lines of credit
3. Mortgage
4. ASB investment credit facility
5. Credit cards

Corporate Profile

RenBridge Sdn Bhd. is an integrated financial services company and a provider of financial education and literacy programs.

We are proud to be working with individuals and corporations in the following areas:-

1. Assisting individuals in providing basic financial services in sourcing the best, most suitable financial products and services including insurance, takaful, investment, loan arrangements, setting up of wills and trusts.

2. Financial planning advisory to individual and companies in the areas of risk management, wealth accumulation and wealth protection and distribution.

3. Training and seminars on financial education. Promoting financial literacy towards better understanding thus better financial and wealth planning and management.

We can be contacted via email at renbridge@gmail.com