Everyone says investment is important.
Why is it so important? After careful research from the Internet and after talking to various financial gurus, I can conclude that the reasons why we need to invest can generally fall under any of the following three (3) categories:
Firstly, we need to know what is Inflation.
“In economics, inflation is a sustained increase in the general price level of goods and services in an economy over a period of time. – Wikipedia”
Inflation is an economic term that basically means the rise of the price of goods or services, making purchasing power become less and lesser. In other words, we have to spend more to buy goods or get services as compared to how much we spent in the earlier years. Example: In the 1990s, we are able to fill the shopping cart in full at the supermarket by just spending RM100. But now, we are unable to do that anymore because of the rising prices of goods.
The opposite of Inflation is Deflation.
Why do we need to beat inflation? So that we can survive and not just live within one’s means.
Many Financial Gurus, Consultants and Agents will always give advise on Retirement Planning and Education Planning. All are correct. These are examples of specific Financial Objectives. One person will have one Financial Objective, and the others may have ten Financial Objectives.
In short, Financial Objectives can be further broken down into three (3) sub-categories:
i – Short Term Goals (1-3 years ahead, some says 1-5 years ahead)
Examples of Short Term Goals: Buy a new phone model, Buy a computer, Buy a car, Buy a house, Getting married etc.
ii – Medium Term Goals (5-10 years ahead)
Examples of Medium Term Goals: Buy a luxury car, Buy a luxury house, Getting married, Opening a business, Retirement Planning, Education Planning etc.
iii – Long Term Goals (more than 10 years)
Examples of Long Terms Goals: Buy a luxury car, Buy a luxury house, Buy a yacht, Opening a business, Retirement Planning, Education Planning etc.
What is important here, is to list down your dreams/goals/life objectives. You can even put up a Dream Board, and share with the people you love.
How is this point different from beating inflation. Making money work for us is not just to beat inflation but tries to help us go and grow much further. This is where smart investors will learn to know which instrument vehicle can help grow their investments faster. Some of the regulated investment instruments in Malaysia that we can use to help us go further:
a) Fixed Deposits
b) Mutual Funds / Unit Trust Funds / Unit Trust Portfolio (more than one fund)
c) Money Market Funds
d) Capital Guaranteed Funds (ASB/AHB/TH/SSPN-i)
e) Private Retirement Scheme (PRS)
f) Exchange Traded Funds (ETF)
g) Real Estate Investment Trust Funds (REIT)
h) Stock Market via Bursa Malaysia
The very most important investment that we need to put more effort in is investing into knowledge.
Note: If you need assistance to open a Unit Trust Portfolio consisting of Malaysian Equity Funds, Malaysian Balanced Funds, Malaysian Money Market Funds, Malaysian Bond Funds, Specific Country Equity and Balanced Funds (India, China, Singapore, Japan), Asia Equity and Balanced Funds, Asia Ex-Japan Equity and Balanced Funds, Europe Equity and Balanced Funds, Global Equity and Balanced Funds ….
… you can always come talk to me and I’ll be glad to help you open up an account.
Expectations: I would like to have a 1-hour session with you to discuss the options and strategies that can be used to help you start invest.