Comparing Credit Reports in Malaysia: Experian Credit Report vs CTOS Credit Report

I’ve always wondered what’s the difference between different credit reports in Malaysia, so I got both Experian credit report and CTOS credit report. This post compares PAID credit reports from Experian (aka mycreditinfo.com.my) and CTOS (ctoscredit.com.my) bought on the same day.

Disclaimer: This is NOT a sponsored article, I am not paid to write about Experian or CTOS reports. I paid for both credit reports out of my own pocket.

The format of this article is:

What is on a Credit Report

My Credit Report from Experian

My Credit Report from CTOS

Experian vs CTOS: Which Credit Report is Better?

How about credit report from Credit Bureau?

Where to get FREE credit report in Malaysia

Why my Experian / CTOS report have no score?

Should you get free or paid credit report?

All information is accurate as of writing time, but may change without notice. Let’s start:

What is on a Credit Report

The Experian credit report contains:

Experian
i-SCORE
 (Credit Score)

Banking Information (CCRIS)

Skim Potongan Gaji Angkasa (SPGA)

PTPTN

Trade References (Non-Banking Info)

Litigation History and more.

While CTOS credit report contains:

Personal Information (NRD)

Directorship & Business Interest (SSM)

Litigation & Bankruptcy

Trade Referee Listings (eTR)

2 Free MyCTOS Basic Reports a year

CTOS Score

CCRIS Records (BNM)

Access to Rewards

*All information taken from Experian and CTOS websites

From here, I can see that both Experian credit report and CTOS credit report contain more or less the same things, but worded differently.

For example, both Experian credit report and CTOS credit report contain CCRIS data*, but Experian calls it ‘Banking Information (CCRIS)’ while CTOS calls it ‘CCRIS Records (BNM)’.

I also have a feeling, but can’t confirm, that ‘Trade References (Non-Banking Info)’ and ‘Trade Referee Listings (eTR) are both the same things too.

(*By the way, you can get CCRIS data/ record for free from
https://eccris.bnm.gov.my/
 – see FREE credit report in Malaysia section below)

But anyway, let’s compare the two

My Credit Report from Experian

This is my result from
Experian Personal Credit Report Plus (PCRP)
, the paid credit report from Experian Credit & Information Services, formerly known as RAM Credit Information (RAMCI).

The 5-page report contains:

Personal information

Credit score
 – My Experian credit score was 640, which is considered Good (but not Strong)

Banking credit information
 – All my credit cards and loans listed

Shareholding/ Directorship and business interest
s – Only 1 – my own company

Legal action
– No info

Bankruptcy Action
 – No info

Non-bank lender credit information (NLCI)
 – No info

Trade Bureau/ Credit reference (CR)
– No info

Enquiries made on you
 – 1

How much does Experian credit report cost?

Experian Personal Credit Report Plus (PCRP)
, the Experian credit report costs RM19.50.

My Credit Report from CTOS

This is my result from
MyCTOS Score Report
, the paid credit report from MyCTOS.

The 4-page report contains:

Snapshot
 – My ID verification

Credit Info at a Glance
 – Summary of credit info information

CTOS Score
– My CTOS credit score was 760, which is Excellent

Top 5 Directorship & Business Interest
 – None listed

Directorships and Business Interests
 – Interestingly my company was not listed

Address records

Banking Payment Records
– All my credit cards and loans listed

CCRIS Derivatives

Legal cases (subject as defendent)
;
(subject as plaintiff)
;
(non personal capacity)
 – No info

Trade reference
 – No info

How much does CTOS cost?

MyCTOS Score Report
, the CTOS credit report costs RM26.50.

Experian vs CTOS: Which Credit Report in Malaysia is Better?

Both are good, reputable credit score check companies, but if I have to choose which one is better..

Accuracy
: AFAIK, data from both reports is mostly accurate – the same financial data was reported. CTOS report missed out my company though

Credit scoring
: Even though my credit score from Experian and CTOS reports are different (640 vs 760), I believe both are accurate. Perhaps they use different parameters and Experian is stricter.

Price
: Experian is cheaper

Security
: Both are good, but Experian was slightly more annoying (not a bad thing. If it’s hard for me, it’s hard for scammers)

Design
: CTOS has better data visualisation and presentation

Speed
: Both Experian and CTOS sent credit reports immediately to my email

Special features worth mentioning
:

Experian Personal Credit Report Plus (PCRP)
 has an additional
Enquiries Made On You section
. Apparently some Finance Banking person enquired about me on 17 May 2022. Who or why, I wouldn’t know. But they should know I know, ykwim?

On the other hand, CTOS has a Rewards section. It’s just some financing options that you can also probably access outside of CTOS, but worth mentioning.

How about credit report from Credit Bureau?

There is one more credit reporting agency that is not included here:
Credit Bureau Malaysia
. Unfortunately, the Credit Report page is under maintenance at writing time, so I am unable to get Credit Bureau report. UPDATE: Seems like their service is now available

Are there more credit reporting agencies in Malaysia? Nope, just those three:  CTOS, Credit Bureau Malaysia and Experian.

According to BNM,

CTOS/Credit Bureau Malaysia/Experian are credit reporting agencies registered by the
Ministry of Finance
 under the Credit Reporting Agencies Act 2010.

These three credit reporting agencies have approval to access the CCRIS system to provide private credit reports to their users, which may include more information than CCRIS.

Where to get FREE credit reports in Malaysia

Both CTOS and Experian offer free credit reports in Malaysia. It’s not as comprehensive their paid versions, but enough if you just want to see a snippet of your financial background.

The links to the free credit reports in Malaysia are:

Experian:
Personal Credit Report Basic
 (no score, no CCRIS)

CTOS:
MyCTOS Basic Report
 (no score, no CCRIS)

The no CCRIS part is actually not a big deal.
 Again, remember you can get CCRIS record for free from
https://eccris.bnm.gov.my/
, or from CCRIS kiosks at AKPK premises. Learn more about CCRIS
here
.

Should you get free or paid credit report?

For most people, the free credit reports PLUS check CCRIS yourself is good enough. Only get the paid versions if:

You want to know your credit score number (hard to improve it if you don’t know the number)

You plan to purchase property in the next 6 months and want to know if your loan application will go through. No point submit loan application if your credit score is too low, it’ll just get rejected

You want to know if anyone took a loan/financing under your name from credit institutions that do not participate in CCRIS*

*CCRIS (Central Credit Reference Information System), which is owned and operated by BNM to facilitate credit risk management among banks, only records
participating financial institutions
.

If any of the above is important to you, then get the paid version, it’s worth the price.

Why my Experian / CTOS have no score?

Some of you might get credit reports from Experian / CTOS with no score. There is no data that can be used to formulate one’s credit score, therefore they have no idea if you are a good borrower or not.

Simply put, someone with No Score:

Do not have
credit card

Have not bought car (hire purchase) nor house (
mortgage
) under their name

Do not have loans, including personal loans or PTPTN

If you don’t plan to apply for any financing in the future, then No Score doesn’t matter, go ahead with your life.

BUT if you aspire to be a homeowner, or would like the option to apply for SME financing for your future business, then you should probably build your credit history from now.

Final note

Like mentioned in the Disclaimer section in the beginning of this article, this is not a sponsored article.

However, I have had working and paid opportunities with both companies in the past, including a
sponsored post on CTOS credit scoring system
 and a webinar talk with Experian (video embedded below). That does not affect my review of both platforms.

How about you? Have you gotten paid CTOS credit report and/or Experian credit report? Was your credit score in CTOS higher than Experian, like mine? Or yours was more similar? Insights welcome in the comments section 🙂

Watch: Ringgit Dijaga, Keluarga Bahagia. My presentation is titled ‘Cara Berbincang Kewangan dengan Pasangan (Tanpa Bergaduh)’. My slot at 50 minutes in


Learn Critical Illness Insurance in 5 Minutes [SPONSORED]

Let’s learn about critical illness insurance, that thing you said you want to get for yourself but have been putting off. I know this because I am you. Or rather, I was, until I decided enough is enough, just get it done.

In 5 minutes, we’re going to cover:

What critical illness insurance covers (and what it doesn’t)
Why insurance agents keep telling you to buy it while you’re still healthy
How much they cost
Where to get it (agent option and online option), and
How to combat analysis paralysis because yes, there are quite a few options for critical illness insurance out there

Let’s start.

#1 – What critical illness insurance covers (and what it doesn’t)

If you look online, one of the biggest complaints people have about insurance is they claim they were denied payment for their insurance claims. Actually… more often than not, they just tried to claim what their insurance didn’t cover.

So let’s use this scenario as an example: you ONLY have critical illness insurance and you were unlucky enough to get a medical condition. Let’s say, cancer.

In this case, you will get the sum insured promised by the insurance provider. If your critical illness plan is for RM30k in sum insured, you’ll get RM30k. If it’s for RM50k, you’ll get RM50k. If it’s for RM100k, you’ll get RM100k. You get the picture.

(The disbursement have T&Cs depending on the plan and the company but let’s keep it simple for now).

What you do with the money is up to you: you can use it to pay your medical and hospitalisation bills, and as salary replacement to cover your living costs. You can even use it to pay for complementary and alternative treatments.

You WON’T get the sum insured for critical illness insurance if you were unlucky enough to be hospitalised for anything other than a covered medical condition, for example due to an accident. That will be covered under life insurance, personal accident insurance and/or medical card, depending on the scope and coverage.

So yes, critical illness insurance is just
one of the few types of insurance that people should have
. It is also one of the top priority to get, because…

#2 – Not everyone can get critical illness insurance

Not everyone can get critical illness insurance. You can ONLY get it if you’re healthy.

There are products that can cover some medical conditions (the term is called pre-existing conditions), such as MSIG’s Gluco SafeGuard, a plan for diabetics that rewards ‘good behaviour’. However, such plans are the exception rather than the norm.

Even if you managed to get critical illness insurance with a pre-existing condition, you’ll have to declare your condition in advance and you can’t make claims related to the medical condition you already have.

For example, let’s say you have kidney problems and you manage to get a critical illness plan. You can only claim it if you develop
something else
unrelated to your pre-existing condition, like a heart attack or something.

Therefore, the ideal situation is to get it while you’re healthy, with NO pre-existing condition. You have to be ok with ‘paying for nothing’. Remember, insurance is not something you buy and immediately put to use. You buy it and hope you
don’t
 use it.

(Personally, I make myself feel better about this by reframing it as the best-case scenario. Yay another month of not using the insurance I paid for, thank you God for the health) (Or Universe. Whatever you believe in).

#3 – How much is critical illness insurance

Your critical illness premium depends on variables including:

Your age (younger = cheaper)
Your gender (men = cheaper)
Your medical history/condition (including BMI)
And more

If you are in your 20s and 30s, you can expect comprehensive critical illness insurance to cost around RM100-RM300 per month, depending on those variables.

Can you get critical illness insurance for cheaper, say around RM20 per month or less?
Can
. In fact, if you can’t afford to get the plan that covers 36 critical illnesses (some providers even go up to 75..), then get the ‘good enough’ plan, which covers 4 illnesses: Cancer, Heart Attack, Stroke and Kidney Failure.

But Suraya, you say, what if I get other illnesses aside from the 4? Shouldn’t I be covered for ALL the illnesses?

Yes that’s true, but consider this: just
those 4 illnesses make up 90% of all critical illness insurance claims
. Statistically speaking, rather than have NO coverage, better get
mostly
 covered, for a
significantly cheaper
 monthly premium.

Again, remember what I said in #2 – not using your critical illness insurance is the best case scenario – it means you’re healthy, but *in case* life has other plans for you, you’re covered. I can’t stress the importance of getting it BEFORE you’re sick, not after. Get one that you can afford, no matter how basic – that is better than not having anything at all.

Plus, when your financial situation improves, and if you’re still healthy, you can always upgrade or get additional plans.

#4 – Where to get critical illness insurance

You can get critical illness insurance and the quotation from insurance agents or online distribution channels.

The first option has more of that ‘personal touch’, so if this article isn’t enough for you to take action, go find an agent and just get it done. They’ll help you get the best package according to your requirements and budget.

You can find agents from:

Asking friends/family for referrals
Social media
Directly from insurance providers websites

The second option is for introverts, eh no, people who prefer DIY research (you’re usually good at it, too) and happy to get their insurance from online platforms.

MSIG EZ Critical Care and MSIG EZ Cancer Care are for those people – you can literally get one or both plans in 15-20 minutes and it comes with 15% rebate to boot.

Here’s how to get it:

Step 1: Go to
https://takeiteasy.msig.com.my/msigonline/
 and click on Healthcare

Link:
https://takeiteasy.msig.com.my/msigonline/

Step 2 – Pick a Critical Illness Insurance

MSIG offers two critical illness insurance products that you can get online: MSIG EZ Critical Care and MSIG EZ Cancer Care. Clicking ‘learn more’ will show you the details of each plan.

To proceed, click on Apply

Step 3: Declare your health background

Now you have to state your age and self-declare your medical background.

Note: You can only proceed with the online method if you have a normal BMI. If you can’t proceed, you can still get the product – simply complete the process manually by downloading and filling out the
application form
 and submitting it to MSIG
here
.

Step 4: Select your Plan

I love this part. You get to pick the plan you want and straight away see how much it would cost. Note that the total amount payable is ANNUAL not monthly cost.

In the example below, my critical illness insurance premium for RM50k sum assured is RM131.55 per year (including RM10 stamp duty cost), which is just RM10.96 per month!

(Side note: I am actually paying for a separate critical illness insurance which costs me RM171 per MONTH for RM200k so believe me when I say this one is CHEAP for 90% of coverage)

Step 5: Fill in Details, Review and Pay

Make the payment by online banking, credit/debit card or e-wallet and you’re done!

#5 – How to decide which plan to get

Some of you, especially DIY researchers, will reach here and be like, I need to compare all plans! All! I will find me the best plan!

Which is great if you eventually do get insured, but not if you put it off. I’m a chronic researcher and put mine off for YEARS. I was lucky to be healthy, but what if I wasn’t?

So here’s what you can do instead: No one said you have to get ONE critical illness insurance – you can get a few. Obviously getting 10 critical illness insurance plans is a bit of an overkill, but there’s nothing stopping you from taking one plan now (the one you can afford) and adding more in the future (when your income and needs grow).

This is not a bad idea, because:

If anything happens, you can claim from ALL of them, not just one
More sum insured means more money, which gives you more options. You’re already stressed from the illness. Don’t stress from finances too
You can get additional coverage for cancer, which is a
really
 expensive illness to treat
Different plans may have specific perks unique to the provider so rather than headache and analysis paralysis to choose, might as well get from a few. For example, MSIG’s EZ Critical Care and Cancer Care both have payouts for early stage detection, whereas most other critical illness insurance plans will only pay at terminal stage
In case one plan lapses and got terminated by accident (or intentionally), you have others to depend on

The catch is, of course, the additional/annual commitment you have to pay.

What else do you want to know about critical illness insurance?

What else would you like to know about critical illness insurance? Leave your questions in the comments section and I’ll do my best to answer them.

Lastly, shoutout to online distribution channels for making it easy for people like me who prefer to buy insurance online, even critical illness insurance. Both MSIG EZ Critical Care and EZ Cancer Care are good options, and the premium is honestly affordable and within reach for almost everyone. Get them from
https://takeiteasy.msig.com.my/msigonline/
.

Note: With all insurance products, terms and conditions apply. Speak to an MSIG Insurance Adviser or contact MSIG for more information.


My Debt Management: All The Good Debt & Bad Debt I’ve Taken So Far

In this day and age, it’s pretty hard to avoid being in any kind of debt. This is a post about my own debt history and how I apply debt management strategies in my life. But first, I want to clear something up:

Taking on debt =/= bad spending habit

To be clear, yes SOME people have problems with excessive spending. HOWEVER, there are also many other circumstances that force someone to take on debt. For example:

They needed money to pay for their or loved ones’ medical bills
Their parents ask them to take on a loan to ‘pay them back for raising them’ (narcissistic parents do this)
As elder sibling, they are expected to help with their younger siblings’ expenses (studies, car etc)
Someone with learning disability or low media literacy is very much susceptible from
unethical and manipulative advertising
Frequent marketing banks and financial providers do to
promote excessive spending

Only 2 out of 5 ppl who get into debt is due to poor financial planning. The rest is due to reasons out of their control
Also let's talk about the frequent marketing banks do to promote excessive spending
pic.twitter.com/aXTapEq1ly
— Suraya | suraya.eth (@surayaror)
July 20, 2021

All I’m saying is… don’t be too quick to judge people who are in debt and reduce them to just ‘bad at financial planning’. You’re capable in understanding more than that shallow reasoning. And if YOU are the one in debt, give yourself some slack, especially if you find yourself in any of these
4 tough financial situations.

Now, with that, let’s get into the meat of the article – sharing my debt history and debt management strategies so far in life.

#1 – ASB Financing

Type: Good debt

In 2011, when I was 22, I took on RM50k in ASB financing. It remains one of my best financial decisions.

In 2021, I got an offer to refinance the loan at a lower rate and took it.

(ASB loan was a good decision for me but it may not be for you. Read more at
5 Reasons You Should NOT Take ASB Loan
)

#2 – PTPTN loan

Type: Good debt

I borrowed some money from PTPTN to complete my Masters. RM8k plus, if I’m not mistaken.

Upon graduation, I dutifully paid my PTPTN loans on a monthly basis. On March 2015, I decided to pay off the remaining balance of my PTPTN loan. There was a 20% off PTPTN discount incentive and so I saved RM1014.82

(Note: this particular incentive already expired)

This is the screenshot of my final payment amount. Paying off a little over RM4k in one go was painful, but ultimately the right decision.

#3 – Credit card instalments

Type: Neutral because all justified purchases

I have taken credit card debt, but ONLY the 0% instalments. The ones where you can convert a big purchase into 6, 12 or more monthly payments with zero additional cost.

The instalments were for:

A laptop – done with payment
A phone – done with payment
Home renovation 1 – currently paying
Home renovation 2 – currently paying

My own debt management strategy with 0% credit card instalment is to
not have more than
1
, max 2 at a time
. Because I’m paying for 2 at the moment, I will avoid any other instalments for the time being and only pay lump sum. That’s what my savings is for.

My cashflow this month is super negative 😖 but proud of myself for making lump sum payment instead of taking (another) instalment
— Suraya | suraya.eth (@surayaror)
February 25, 2022

Again, the only instalment I’ll take is the 0% instalment. I do not and will never (touchwood; if I can help it) get into credit card debt where I have to pay 15-18% interest rate on my balance.

#4 – Credit card cash advance

Type: Bad debt

This one is embarrassing for me to admit, but I believe in transparency and this is a personal finance blog (emphasis on
personal
 and
blog)
, so… here it goes. Once, I used the cash advance service offered by my credit card to… buy bitcoin.

I know, reserve your judgement. I’m not going to pretend I’ve never made any financial mistakes you know.

Unlike #3, this service came with a fee – 3.88% interest rate for 6 months (or effectively 7.76% per annum). That’s high – in hindsight, I was stupid. I paid it off, but I really shouldn’t have taken it in the first place.

To be super clear, DO NOT DO THE SAME THING. Thank goodness it turned out well (this happened in 2016 or so), but I can’t give myself any credit for skill at all when all there is to it was
I simply got lucky
.

That’s my debt history and debt management strategies. How about yours?

Luckily for me, my debt situation at the moment is under control. I don’t have mortgage or car loan under my name, nor do I plan to take one in the near future. All the debt I have is good and justifiable debt.

But even if they are good and justifiable, debt is still debt. My preference is to not have any at all, actually.

I also have this theory that the easier it is to borrow money, the less likely it is for salaries to increase. I mean, why would they increase salaries when they can just allow you to borrow from Future You’s income, am I right?

Have you noticed that nowadays, instead of increasing salary, the trend is making it easier for people to borrow from future income? And then they call it 'affordable'
This is just one of the points I made. Listen to the rest at:
https://t.co/FDMtIxew3x

https://t.co/pchBtThP9d
— Suraya | suraya.eth (@surayaror)
July 15, 2021

I’ll leave you with that food for thought. Now to you, dear readers. What debt do you have? Have you taken bad debt – and if yes, what’s the story?

How to Pay off Credit Card Debt in Malaysia

If you are in debt, you have 2 options: (1) Try and dig yourself out of it via DIY research (the video below is a good starting point), or (2) Contact
AKPK
 and see if you are eligible for their Debt Management Programme (it’s free!)


How to Digitally Protect Your Money – A Checklist on Digital Security in Malaysia

Hacking. Ransomware. Phishing. It’s a scary time for all of us, especially now that most of our money is digital. ‘Digital’ here refers to money and assets that are reflected in your various banking and investment platforms when you log in.

Digital security is not something you can ignore anymore, dear readers. Imagine logging in one day and finding that your account balance is
zero
, depleted, transferred out. You’ll stare at the screen in disbelief. You’ll check if the account is indeed yours, and try to remember if you made any transactions that you forgot about (you didn’t). Then, as the panic seeps in, you’ll contact the platform’s support team, only to be told that there is nothing they can do.

To the best of my ability, I’m compiling a checklist of things you should do to make sure your digital money is adequately protected.
This article is not complete, digital-based scams evolve all the time, so please help me to update this article if you have anything else to add
.

geralt
 / Pixabay

Checklist #1 – Your emails

Emails can be weak links; once infiltrated, the hacker can look through and find your sensitive information, which are then used to hack your banking and investment platforms. You don’t want that to happen.

Do the following:

Check if your emails have been compromised by data breaches
 (when big platforms were hacked and users’ data were leaked). Go to
HaveIBeenPwned
 and type in your email addresses. If your emails were compromised, change the passwords immediately

Delete and unsubscribe from all accounts you no longer want
, even for entertainment and shopping websites. Go to
unroll.me
 to quickly unsubscribe from email listings.

Use a damn strong password and a different one for each account
. If have not used a password manager, it’s time to use it – it’ll keep your passwords and can help you generate strong ones. There are many free and paid options. Free ones are enough imho,
some good ones are recommended here
.

Be on high alert for phishing attempts.
 They are official-looking emails that imitate legitimate platforms (like Paypal, for example) and ask you to access your account via their link. Scammers use it to collect your login details.

dawnfu
 / Pixabay

Checklist #2 – Your banking and investment accounts

They should have multiple layers of security. Ideally, if someone (touchwood) even managed to get access to these accounts, there should be measures in place to stop them from transferring out money, or at least inform you about it. For Maybank for example, they use TAC (the 6-digit code sent to your phones). Some platforms also have other measures like mandatory email confirmations before completing transfer and 2FA (two-factor authentication).

Do the following:

Https, always.
 Always check. It takes you two seconds.

The spelling of the website matters
. If it’s Mabank instead of Maybank (example), it could be an imitation website designed to steal your login details.

Never keep your passwords or PIN numbers in writing.
 Not in notebooks, not in emails, not anywhere. Remember them. Some services will give you on-request PINs via emails – delete them after using.

Use 2FA whenever possible
. Two-factor authentication is similar to TAC numbers. You can activate it for some websites and emails as well. I recommend Authy.

Again, use damn strong passwords
. Use password generators and password managers.

Pexels
 / Pixabay

Checklist #3 – Your computers and gadgets

Do the following:

Update to the latest software and security patches, especially if you use Windows platform
. Outdated ones might not protect you against newer, more sophisticated hacking attempts.

Use Mac/Apple products if you can afford it.
 The reasoning is simple – the majority of the population uses Windows platform, so there are more attempts there. It doesn’t protect you per say, but will reduce the chances.

Back up your data often.
 Use Google Drive or other cloud storage to keep important documents you don’t want to lose. Alternatively, keep data in external hard disks. If you were hacked, at least you are not forced to pay the hackers to get back your data.

Perform anti-virus often
. To delete malware and viruses.

Cover your gadget’s cameras when not in use.
 There are instances where users’ gadget got hacked and recorded them in uncompromising situations, then they are blackmailed for money. Even smart gadgets like TV can be hacked. Just put a sticky tape on them to avoid this.

maxlkt
 / Pixabay

Checklist #4 – Yourself

Because human error happens and no amount of advanced digital security knowledge can protect you against it, except extreme vigilance and preventative actions. This checklist is important, because
if it’s your error, most of the time there is nothing authorities can do about it. Its hard if not impossible to recover your money.

Do the following:

Don’t make enemies.
 No matter how much you protect yourself, if a hacker is determined to target you, they will.

Be extra careful of people who ask for sensitive info via phone.
 They can pose as bank staff or Bank Negara Malaysia staff or whatever. Listen for cues, say thanks, and tell them that you’ll call them back through the official line (which you’ll get from the official website, don’t call them back on the same line). If they panic, they’re probably not legit.

Be skeptical of ‘do this now or else’ type of instructions.
 Often, the scammers will persuade you to act fast (give them login info, sensitive info, etc) to stop you from double-checking. They will say your account is frozen, or someone is in danger, or whatever.

Please read up on investment scams
. If you can identify and avoid them, you’ll win half the battle. Related:
How to spot investment that are actually investment scams

Conclusion

Take half a day to just sort all these digital security thing out. I’m dead serious about this. I hope with the above checklist, your money will be safer from now. Do assist your technologically-challenged family and friends, too. These things are easier for tech natives but not so much with them. Help them to reduce their risks.


8 Ways to Use Duit KWSP, from Best to Meh

For some reason, the government thinks letting people access their own retirement savings is a solution to be proud of and proof of their competency, so okay let’s roll with that and collectively pretend that it is so we don’t hurt their feelings. They are desperate for rakyat’s approval.

First: This is not an article whether you should or should not take out duit KWSP. This is an article about the best uses for it, *if* you take it out. If you haven’t and plan to, submit your application at
https://pengeluarankhas.kwsp.gov.my/

before
 30 April 2022.

Here are the 8 best uses for your duit KWSP, ranked from best to meh. Go through them one by one – some will apply to you, some won’t. If it doesn’t apply to you, do the next best thing.

#1 – Get out of dangerous or abusive situations

If your partner, parents or guardians have been giving you physical, mental or financial abuse, then use your duit KWSP to save yourself.

This also applies to abusive employers. This is your opportunity to find other jobs and get the hell out of there.

I paling kesian dengan orang gaji rendah dengan bos abusive. Bila stress of course akan selalu rasa nak self-reward as coping mechanism. Jadinya tak dapat nak saving sangat
Tak simpan duit, tak boleh nak berhenti kerja, maka stuck la kat situ selamanya 🙁
— Suraya | suraya.eth (@surayaror)
January 13, 2022

#2 – Pay off credit card/ personal loan

If you have credit card debt,
especially
balance carried over from previous months, it’s a great idea to use duit KWSP to pay off the debt.

Don’t skip your credit card payments any longer. Not only you’re paying a lot in credit card fees, you’re also going to eff up your credit score. Later when you want to buy house or whatever, you might get worse rates, if at all.

Getting bad rates for house loan aka mortgage is a bigger deal than you think. Because the amount you need to borrow is huge (at least six figures), a difference of even 0.1% can effectively mean you’ll be paying thousands extra, for nothing!

Paying of high-interest debt is also Step 2 in the
 journey to be financially free
.

#3 – Top up emergency fund

For people who have had their emergency funds depleted, then I’m sure the duit KWSP announcement was super welcomed.

#4 – Get your health concerns sorted out

Awesome, you are not in any immediate danger and have no high-interest debt left. You also have less financial anxiety, now that you have some emergency fund. Next let’s focus on your health:

Get your recurring headache or weird lumps and bumps checked out
Buy your supply of prescription pills in advance
Get a comprehensive health checkup (keep the receipt,
can deduct tax relief
)
Speak to someone about your mental health

Health is wealth is cliché, but true. Speaking of health..

#5 – Fix those things that are already causing you pain/may cause you pain in the *short* term

You suffer from back pain? Get a better mattress and/or a comfortable work chair.

Your car tyres are getting worn out and you drive around a lot for work/travel? Get new car tyres.

Walking hurts? Get a new pair of quality shoes.

The general rule is, if it keeps you from off the ground, it’s worth the money.

#6 – Decide how much you want to allocate as ‘fun’ money

Okay, so by this point, you’re feeling good about yourself. You went through #1-5 and done all the ‘responsible’ things. It’s time to reward yourself with the amount left over!

But you also know the importance of saving up for rainy day and don’t want to spend all your duit KWSP money. Who knows when you’ll get a ‘windfall’ again right?

Now is a good time to have that internal discussion with yourself on the maximum amount you’ll give yourself for ‘fun’ spending.
 You know, for clothes, gadgets, food, socialising, whatever.

If its RM100 per month, it’s RM100 per month. If it’s RM500, it’s RM500. Up to you, you know yourself best. Why not stretch out the money and have fun for months to come rather than finish off all the money right after you get it.

(Side note: It’s better to give yourself a small allocation rather than NO allocation. You’re human, it’s natural to desire stuff and experiences. Plus it’s better to allow yourself to be happy while appreciating small pleasures rather than blaming yourself for failing to keep to a strict budget)

#7 – While hunting for deals, put that money in other savings-earmarked accounts first

While you do your deal-hunting research to get the items/experiences you want, it’s a good idea to put your duit KWSP money elsewhere and not in your *main* bank accounts.

One – you’re less tempted to make impulse purchases ‘just because the money is there’.

Two – maybe the money can even grow a little bit while you decide what to spend on.

Here are
5 Best Places to Save Money in Malaysia, Ranked

Personally I am a big fan of ASB. Comparable returns and easy to withdraw when needed. When not needed, the money compounds (aka grows into more money = awesome).

View this post on Instagram

A post shared by Suraya Zainudin (@surayaror)

#8 – Find opportunities to make money

Some of you may have skipped #1-7 altogether. You’re like, no Suraya! The money is not for anything frivolous! All I care about is GROWING it!

Alright okay okay I gotcha. I don’t understand why you need to use duit KWSP for this but fine.

Generally speaking, there are 3 main ways to make money: (1) earning more through your day job, (2) earn through side hustles, and (3) investing.

If you’re leaning towards (1), then read this:
3 Ways to Get A High Salary in Malaysia

If you’re leaning towards (2), then read articles under the
Earning Money
 category. You can rent out your car, monetise your hobby, organise a workshop and more.

If you’re leaning towards (3), then read articles under the
Investing
 category.

Generally speaking,
using the gains/profits from your work (1+2) to funnel into investing (for the long term) is the best strategy.

That should be it. I won’t insult your intelligence by telling you not to get this or that, you big already. I wish you all the best in growing your income so you can replenish your retirement savings as soon as you can.

If you’re a Muslim, find out if you need to
pay zakat on duit KWSP
 (tl;dr, (tl;dr, pay 2.5% in zakat, but this can be exempted if the money will be used for necessary and living costs).

Are you planning to withdraw your duit KWSP?

If yes, what do you plan to use it for? If no, what convinced you? Let me know in the comments!


How Expense Tracking Looks Like (As Someone Who Doesn’t ‘Budget’)

If you’re a regular reader here at Ringgit Oh Ringgit, you know that I share my monthly expenses
every. single. month
.

The reason why I prefer expense tracking rather than budgeting is simple: it just works ridiculously well for me. All I have to do is record all my expenses and suddenly my financial life is just better, more organised, data-driven.

I don’t have to stress about keeping my expenses in one particular category under a certain amount, because I know that as long as it averages out okay in the bigger picture, I’m good.

(Example: Buying groceries in bulk will increase my groceries expenses in that month but lower them in subsequent months.)

This article is how about
how
 it works.

How my expense tracking looks like

If I put it in steps, it looks like this:

Step 1: Make whatever purchases I need for daily life

Step 2: Enter it in the expense-tracking app in my phone

Step 3: Review it occasionally and make mental notes to adjust spending in the coming days/weeks/months

That’s, uh, pretty much it.

You don’t have to use an app. Some people prefer pen and paper – that’s fine too. Some people like using Excel or Google Spreadsheet. If it works, it works.

Example: Mimirello’s (free downloadable) spreadsheet. Straightforward, right? Click
here
 to download at her website.

 image source: mimirello.com

And here’s how @debtfreemy’s look like:

A post shared by debtfreeMY (@debtfreemy)
 on
Jun 27, 2018 at 2:02am PDT

Personally I love using apps, simply because my phone is near me 24/7. The expense tracking app I use is called Money Lover (
my review
). I believe it costs RM29.99 now, almost double what I paid for it back in mid-2014.

You don’t have to get the same app.
There are many other free and paid options. I asked around the Malaysian personal finance community, and here are some expense tracking apps they personally use:

HomeBudget

iRekaSoft

Buku 555

Money Coach

YNAB (You Need A Budget) – I heard this one is really good but it’s subscription-based

Toshl

Budgie

Every Pocket

Money Manager

Trabee Pocket

If you’re fans of any of the above apps, let us know why you like it in the comments section. Let us know if you’re using another app too.

Making the habit of expense tracking easier

Some people told me that they tried expense tracking, but ‘fell off the wagon’, so to speak. I don’t claim to have all the solutions, but I can share how I make the whole process easier.

#1 – I’ve locked down categories that work for me

I have 13 categories.

In
bold
= Expenses that can’t be avoided, but I try to get the most of it when I can (example: getting reward points when paying for electricity).

In
italic
= Things that I pay for  a better quality of life, to avoid turning bat-shit crazy and avoid being an uninteresting person in general. I don’t put a limit, but I don’t go overboard.

Business
 – website maintenance, tools

Dates/Travel
 – self-explanatory

Donations & Gifts
 – self-explanatory

Food
 – for the occasional Chatime and Rotiboy (not Groceries; I track this because it tends to correlate with weight gains)

Groceries
 – Gotta eat

Insurance & Medical
 – self-explanatory

Loan Repayment
 – PTPTN loan paid off! Now paying ASB loan and laptop instalments

Misc Needs
 – Things I need to function as an adult. Doesn’t occur frequently enough to warrant its own sub-categories. Ranges from new passport fee, sunblock lotion, home repair costs, etc

Misc Wants
 – Things I want, usually when I’m weak and/or can’t resist a great deal. Stuff like new clothes, accessories, home decor, etc

Mobile
 – self-explanatory

Public Transport
 – My Grabs and LRTs

Social
 – Gotta meet people and socialise

Utilities & Rent
 – self-explanatory

These categories are personalised for me based on my spending pattern – I don’t have a car, so I don’t have Petrol/ Car Payment/ Toll/ Car Maintenance categories. Add/subtract/adjust as necessary.

If you want to check how much you spend on fashion/makeup/gaming/some-other-hobby on a monthly basis, this is a good way to find out as well. If you just want two categories: Necessary Purchases and Unnecessary Purchases, feel free to do that too.

I absolutely love the insights that come from these data – where my money goes show who I am, as a person. That itself motivates me to continue this expense tracking habit. Related read:
My Total Income and Expenses in 2017
.

#2 – If I forgot the amount, an estimate will do

As much as possible, I try to log those expenses immediately, but I’m no robot.

What I do is request for a receipt and keep that in my wallet to sort out later. If I don’t have that, then I’ll just log an estimate, rounded up.

Extra bonus in this method: I’ll automatically deduct expenses lost outside of my control, like if I dropped money somewhere (touch wood!), or if whatever service I’m using incur a fee I missed.

#3 – Not sweating the small details

Someone asked me how I track across different bank accounts and credit cards, and here’s the thing: I don’t. All expenses go into those 13 categories, regardless where they’re deducted from. I guess it’s easier because I intentionally limit my banking to just two major banks and three credit cards.

I also don’t include amounts deducted for investments in here. My justification: those are not ‘expenses’, those are income for future me.

#4 – Automating recurring expenses

My app has a feature to automate recurring expenses, so I don’t have to keep logging that in monthly. These include things like rent,
insurance
, ASB loan, laptop instalments, things like that.

This makes life a little bit easier for me.

Related read:
What Subscriptions I Pay For And Why

What you can do with all the data

Lots of things! You can:

Stop wondering where your money went
! You’re effectively a detective, digging on your own shit :p

Find out from the data what you prioritise/ value in life
. Maybe you’ve been in denial about your shopping addiction, and seeing the actual amount spent is just what you need to whip your finances back into shape.

Tweak your spending for the coming months
. If you think your food spending is higher than expected, you might decide to pack your lunch to reduce that spending, at least for the next few months to bring the average down.

Motivate yourself to be debt-free
. Getting into the habit of expense tracking can be enough to
deter
 unnecessary spending in the first place! Note: for extra extra motivation, join the #debtfree community on Facebook, Twitter and Instagram

Quickly check when you made certain payments
. Adding notes when you track expenses is incredibly useful. Like last time, my landlady wanted to know when was the last time I serviced the aircon in my rental unit. How would I remember! Thankfully I had the notes and could tell her the exact date. That particular incident saved me money – I didn’t have to service the aircon again before I move out (as per Tenancy Agreement).

Set’money challenges’ for yourself
. Challenge yourself to have no-spend days. Or ‘spend below RMxxx for Social category in X month’. Or ‘zero unnecessary spending week’. Whatever rocks your boat!

Last words

Do you do expense tracking too? What are your tips to make it into a habit? What have you found out about yourself since you started doing it? What do you find hard about it? Let us know!


How I Use Faraid Calculator to Decide Who Gets My Money After I’m Gone

Do you know who gets your money after you’re gone? Have you used a faraid calculator and know for sure which of your family members are your faraid heirs, aka people who have claims to your assets after your death, according to Islamic inheritance laws?

No, push through the ‘this is uncomfortable to think about’ thoughts, this is important. As the popular Malay saying goes, mati itu pasti.

Here’s how to use faraid calculator so that you can know, then decide who gets your money after you’re gone. There’s literally only 5 (+1) steps:

Step 0:
 Know how Islamic Inheritance Laws work – Deduct burial costs, debts and Harta Sepencarian first

Step 1:
Use faraid calculator – see
who
 have claims to your money under Islamic inheritance laws

Step 2:
If you’re happy with your faraid heirs, set up Wasiat (Cost: RMxxx)

Step 3:
 If you want to personalise your faraid heirs, set up Hibah (Amanah/Mutlak), Wasiat and/or Trust

Step 4:
 (Optional but encouraged) If you want to give EXTRA money to your loved ones (faraid heirs or not), subscribe to Hibah Takaful

Step 5:
 (Optional but encouraged) If you want to leave (some of) your wealth to charity for the pahala, set up Wakaf

Please note that the above is an
oversimplification of what can be a complex estate-planning process
. If you have multiple faraid and non-faraid heirs, multiple types of properties and assets, etc, please engage a professional rather than DIY-ing it.

Disclaimer
: I have done my share of research on this topic. I have talked to Islamic estate planning professionals and financial planners. I’ve made sure the information is accurate to the best of my ability. However, my knowledge may be limited. I invite you to share what you know in the comments section.

Step 0: Know how Islamic Inheritance Laws work

Under Islamic inheritance laws, if there are no documents in place, the wealth of a Muslim who passed way must be used to pay off burial costs and debts first, BEFORE half of it is distributed to the surviving spouse as Harta Sepencarian, BEFORE distributed to faraid heirs.

Deduct burial costs, debt and Harta Sepencarian first

How it works is:

Person A dies

Pay burial cost

Pay off debts, if any

Spouse of A gets half of assets as Harta Sepencarian*

The remaining of Person’s A’s assets is distributed according to faraid

*A lot of people don’t know/ forget about Harta Sepencarian, either intentionally or not. This is obviously unfair in situations where the widow is a homemaker taking care of children/the elderly.

A common question here is – what if Person A’s wealth is just enough to pay burial cost and debts? Will the spouse get Harta Sepencarian or their faraid heirs get their allocations?

The answer is no.
If there is no more wealth to be distributed after paying burial cost and debts, then there is no Harta Sepencarian nor inheritance to faraid heirs.
 If this upsets you, see Step 4 for solution.

Types of assets to give your beneficieries

Here are some items that are classified as assets:

Properties/Land

Bank accounts

Stocks and securities in Bursa Malaysia

Vehicles

Unit trust accounts

KWSP/EPF

Insurance policies

Companies I own / have shares or equity in

Safe deposit boxes

Club memberships (that can be inherited)

Jewellery

Note: I own cryptocurrencies. The best way to distribute this, according to my advisor, is to put the keys in a safe deposit box and leave the details in the legal documents.

Step 1: Use Faraid Calculator

First, you have to know
who
 is your faraid heirs, as decided by Quran and Sunnah. The rules can be complex and depends on many factors, so the easiest way is to use a faraid calculator.

There are a few versions of faraid calculators out there, including
USM’s Sistem Maklumat Faraid
.

Personally, I like to use
iFaraid Calculator app
 – you can find it in the App Store. All I have to do is input my family members, and it will show how much everyone will get.

Using myself as an example, I inputted the following family members in the Heirs List:

Husband

Mom

Dad

2 Sisters

1 Brother

No grandparents 🙁

If I click on the Family Tree tab in this faraid calculator, I can see (1) who are my faraid heirs, and (2) the allocation of my wealth that each of them are entitled to:

Husband: 3/6

Mom: 1/6

Dad: 2/6

Sisters & Brother: None

Now, my situation can be considered simple. It gets considerably more complex if I have children, grandfather, or if my father is no longer around. x out of 36 allocations (or more) is not uncommon.

I’ve tried a few faraid calculators and
iFaraid Calculator app
 is the easiest one yet to understand, so I recommend you try it too 🙂

Step 2: If you’re happy with your faraid heirs, set up Wasiat

Now, if you’re happy with who your faraid heirs are, all is good. You can set up Wasiat document and just state you want your wealth to be distributed according to faraid.

Here, you might ask – but if faraid is implemented anyway, wouldn’t it be fine to skip the estate-planning paperwork?

Important: You should do Wasiat even if you want to follow faraid

It’s important to set up Wasiat even if you’re happy with who gets your money under Islamic inheritance laws
.
Without the documents, your heirs will be going through a long, complicated court process which
may
 will take years*.

See, you can select ‘Entire Estate Distribution Following Faraid Allocation’ under Mode of Distribution. Pic from Maybank Wasiat/Will-writing service page in Maybank2u.

I’m serious – go ask Shariah lawyers. I was informed there is so much backlog, heirs may have to wait for a year or more just to get court hearing date. It takes much longer if your heirs are uncooperative/ busy/ no money to go through the process.

Personally, I’d love it if my partner and parents can get my money ASAP. They can do a lot of good with it, instead of waiting for the assets to be ‘unlocked’.

Where to do Wasiat in Malaysia

You can do Wasiat at a few places:

Banks: some of them offer Wasiat services

Estate planning companies: As-Salihin, Wasiyyah Shoppe, Amanahraya etc

DIY services like
Pewarisan
 (most affordable option)

Cost to do Wasiat: RMxxx

Step 3: If you want to personalise your faraid heirs, set up Hibah (Amanah/Mutlak), Wasiat and/or Trust

Now, let’s say I DO NOT want to leave my wealth behind to my faraid heirs, because they are abusive or financially irresponsible or whatever.

Or maybe I’m happy with my faraid heirs, but I ALSO want to give to someone else. Perhaps other family members, or even friends.

I should now look into:

Setting up Hibah documents

Editing my Wasiat

Consider setting up a Trust

If you’re at this step, more often than not, you’re doing Hibah AND Wasiat, not either or. Let’s go over each of them:

1) Setting up Hibah documents

Hibah is basically ‘gifting’ –
the assets you give away will now no longer be included under assets that need to be distributed under faraid.

There are three types of Hibah:

Hibah Amanah – give the asset after your death

Hibah Mutlak – give the asset while you’re alive

Hibah Takaful – kinda like life insurance, see Step 4

There are a few pros and cons to Hibah Amanah and Hibah Mutlak you need to be aware of:

Pros
:

You can
give your assets to whoever you want
. There are no limitations to religious background, family ties, etc

You can
Hibah Amanah your funds in ASNB
 for just RM100 (promo price, usually RM180). More info in
The Exact Steps to Do Hibah Amanah ASNB

Cons
:

Not everything can be hibah-ed ou
t. For example,
you can’t hibah EPF/KWSP money
 (this is why I contribute just enough to max out the tax relief, but not more, and happy to use
EPF i-Lindung
 to get insurance)

You can only
hibah assets that are clear of debt
. Therefore property, vehicle etc that are still under mortgage and hire-purchase loan cannot be hibah-ed. You’re probably paying takaful that will pay off this debt in the event of your death though

Hibah Mutlak (transfer ownership while you’re still alive) is good but it does mean
the property is no longer your property.
 With no/less assets, you’re reliant on family to take care of you, especially when you’re old/sick/vulnerable. (For this reason I much prefer Hibah Amanah)

Next is Wasiat.

2) Editing your Wasiat documents

Next, you may want to clarify in your Wasiat document that you’d like to allocate up to 1/3 of your wealth to non-faraid heirs. It is allowed.

Note: Non-faraid heirs includes: adopted family members, non-Muslim family members, domestic partners, friends etc.

3) Consider setting up a Trust

If
Wasiat
 is for the distribution of assets after death, and
Hibah
 is gifting assets away, then
Trust
is like a contract document – you can set conditions for distributions to your beneficiaries.

It’s cool because you can add clauses like:

‘to allocate person X money for medical care if you’re in a coma/have permanent disability or cannot make sound judgement’, and

‘to give person Y staggered payments according to agreed schedule after your passing (ie RM2000 per month until the money runs out)’

I believe you need to lock in a fairly large amount of cash for this option (I believe I heard RM50k minimum), and the fees are steep. So you need to be wealthy enough. Discuss with your estate planner is you truly need to set up Trust, it really depends on your situation.

How to do Hibah, Wasiat and Trust documents

You can do
Hibah Amanah ASNB
 and
Hibah Takaful
 yourself, but it is recommended to
hire a financial planner
, and/or approach companies like AmanahRaya, Wasiyyah Shoppe and As-Salihin if you have assets in multiple bank/investment accounts and/or multiple properties/land.

Which one is the best? They’re all good and reputable Islamic estate planning service providers. My suggestion is pick the one with office convenient for you, because the entire process might take a few visits.

Cost-wise, it depends how complex your documents are – the more properties and beneficieries you have, the more expensive it might get. Personally, I helped my mom do her Hibah and Wasiat documents and it costed RM2,650 in total (2021 price).

I’m aware the price can be steep for some. If you’re familiar with legalese, one budget-friendly option is through
Pewarisan.com
. For RM330, you will get these legal documents:

Surat Wasiat

Perisytiharan Harta Sepencarian

Perisytiharan Hibah

Step 4: If you want to give EXTRA money to your loved ones (faraid heirs or not), subscribe to Hibah Takaful

Now, you might be looking at all the steps and be like, oh, I don’t have a lot of wealth to pass down anyway, estate planning is not for me.

That’s not true!
With Hibah Takaful, you can leave behind six-figure inheritance to whoever you want with just RMxx-xxx monthly commitment
. Your spouse, your children, your parents, whoever!

It’s too long to explain in this article but do read my
Everything You Need to Know About Hibah Takaful, from a Non-Agent
 article.

Step 5:  If you want to leave (some of) your wealth to charity for the pahala, set up Wakaf

According to our religion,

“When a man dies, his good deeds come to an end, except three:
Ongoing charity, beneficial knowledge, and a righteous child who will pray for him
.”

The ongoing charity part is important to me, and may be to you as well. Many people do earmark properties or assets to be given to charity after their death. You might have heard the term Wakaf.

You can discuss with your estate planner and/or heirs about Wakaf. But I do want to share, nowadays, thanks to technology, it is easier than ever to do Wakaf. You can even
give part of your funds in ASNB for Wakaf through the MyASNB App
!

The idea is, the dividends from your Wakaf-ed funds will be channeled to charities benefiting the ummah forever, even after your death. You get continous pahala. Isn’t that neat? 🙂

Do your estate planning ASAP – start with faraid calculator

The simple fact is no one know when they’re going to die. So you have to at least put *something* in place, for the sake of your loved ones.

It’s also practical to get your estate-planning sorted out because why would you spend your life accumulating wealth, just to let your assets go frozen and unclaimed, possibly for decades?

credit image: Amanahraya

Don’t let your wealth get frozen after your death

And when I say a lot, I mean a LOT. It is estimated that anywhere from
RM90 billion
 to
RM105 billion of assets
 are ‘locked’ as frozen assets, 90% of which belong to the Malay community.

That’s a huge number so let me break it down. Assuming there are 20 million Malays in Malaysia, that’s an average of RM4050 to RM4725 in unutilised wealth, EACH! Money that could have been used for your children’s education or wealth building for the next generation are ‘locked’.

Ensure your wealth goes to people you want it to go to

And that’s if you LIKE your faraid heirs. What if you don’t? You want your money may go to people you may not even like*, because you’re bound by Islamic inheritance laws?

*you’re lucky if you have responsible/non-abusive family members as faraid heirs. Not everyone does

As a special note, Muslim converts NEED to set up estate planning documents as well. That’s because your non-Muslim family members have no claims to your wealth – all/most of it will go to Baitulmal. I’m sorry it works this way, but it does.

Invitation to share your experience

To Islamic Financial Planners/ Estate Planning Professionals – If any info above is wrong or lacking, please comment and share your knowledge. Leave your contacts if you want, so others interested to set up estate planning documents can contact you.

To everyone who has a Hibah, Wasiat and/or Trust in place. Share your experience – which company you used, how’s the process like, how much was the cost, things like that.

So anyway, I’ll end here. I’ve shared the knowledge, now its up to you to take action. Start with trying out the faraid calculator – download the
iFaraid Calculator app
. Have a blessed Ramadan y’all.


5 Things I Learned from My Financial Behaviour Report

Throughout your life, you will make hundreds if not thousands of major and minor financial decisions. Should you buy or rent?  Which investment should you get? Should you hire a financial planner?

As many will tell you, there is no right answer. It depends on your situation; a decision that works with one person can completely backfire with another. Therefore, you just have to learn all you can and where possible, experiment with what works for you and what doesn’t.

Personally, I have experimented with so many financial challenges. Some were successes, others were failures (which is okay; knowing what doesn’t work is progress too).

But what if there was a shortcut? A way to figure out YOUR unconscious behaviour, so you’re aware of your financial strengths and weaknesses?

I took that shortcut. I took the
Financial Behaviour Report
. It’s a paid service to reveal ‘how people like you make decisions about money’ via a series of behavioural questions. Here are 5 things I learned.

#1 – I should get a Balanced portfolio structure

All my adulting life, I have the tendency to go for Growth or Aggressive portfolios, because ‘young people can afford to take more risks’ mindset.

But according to my results,
my natural risk tolerance is not that high.

Maybe it’s because I naturally get more cautious with my risk level as I get older. Maybe I’ve learned to value peace of mind more than maximising profit from my investments.

Whatever it is, is this why I am frequently worried over my current investment portfolio, which is crazy high risk? (You can see my investment portfolio breakdown
here
, but long story short, crypto dominates my portfolio).

#2 – I prefer DIY financial planning

According to my report, I prefer to DIY my financial planning, rather than work with a financial planner.

But IF I choose to work with a financial planner, I should keep in mind the advisor’s personality. Do I want someone who I can work easily with, or someone who can offer a different perspective? That’s something to consider if/when I can convince the control freak side of me to seek help.

#3 – What my strongest behavioural factors mean to my personal finance

Who would have known that someone who is
Reserved
and
Creative
would result in behavioural biases
Mental Accounting
 and
Newness Bias
? Not me.

(Btw, I was offended by Reserved outcome, but yup that describes me alright. Nothing like finding out who you are without being sugar-coated)

This section also confirms what I knew all along – see the third line, Financial Attitude – I’m a natural saver (instead of a natural spender.

Another section also confirms what I knew all along – I am not a particularly ambitious person, and even if I set ambitious goals, they change all the time because I’m flexible.

Yup, no need for a grand life. I just want a simple life, where I get lots of time to think and get lost in my head. That’s what I aim for, that’s my definition of a good life. Yours might be different and that’s cool too, as long as you know what’s important for YOU.

#4 – I’m kinda financially disorganised?

This one came as a shock!! I scored low on financial organisation, and don’t follow budgets nor set agendas.

Kinda bummed about this, I thought I’m alright at this skill, but hey. At least I know than be in denial, correct not. Something to work on.

#5 – My Financial Compatibility with My Partner

The
Financial Behaviour Report
 is available for Individuals (RM49) and Couples (RM99).

I took the Couple one; both of us completed it in one afternoon, and had a really nice, really frank conversation about our financial compatibility.

I found out that:

Both of us have similar risk behaviours

Both of us desire a simple life (yay!)

He prefers to seek advice from financial planners

He’s better at budgeting and saving money than I am (I’m the spender in this relationship??!!)

I have higher financial emotional intelligence (but at 50 out of 100, not *that* high; can be better)

Freaking valuable information, this. After all, most couples fight about money, so it’s good to know where each of us stands at different financial touchpoints.

Where I Learned about the Financial Behavior Report

I learned about the
Financial Behaviour Report
 tool from
Farah Adira
, a Licenced Financial Planner with Islamic Financial Planner (IFP®) credential since 2016.

She has a Bachelor’s degree holder specialising in Islamic Financial Planning, more than 7 years of exposure in Financial Planning, and regularly give talks and provide 1-on-1 financial consultations to corporate clients.

The
Financial Behaviour Report
 tremendously helped me, so I contacted Farah and asked if I can help her promote and sell it to you, so you can benefit from it too.

You’ll get your report emailed to you. It’s fairly easy to read.

I honestly love the report and would recommend it to anyone who can afford the RM49/RM99 cost. If you get your
Financial Behaviour Report
 done, let me know in the comments – what surprised you and what have you known all along?


Guide: 7 Steps to Achieve Financial Freedom in Malaysia in 2023

Hey, you. You want to achieve financial freedom in Malaysia, but don’t know how. You may not even know what that entails. Financial freedom is like one of those meaningless phrases, like ‘paradigm shift’.

Let me help you unpack that phrase and lay it out, in this step-by-step guide format.

What are the 7 Steps to Financial Freedom

Earlier in my personal finance journey, I came across
Dave Ramsey’s 7 Baby Steps to Financial Freedom
, and the information helped me make sense of it all. It gave me clarity and made the process of achieving financial freedom look less daunting.

In this article, I’d like to give you my own version of 7 Baby Steps. Call it
Suraya’s 7 Baby Steps to Financial Freedom in Malaysia
. The original version is already good, but what I’m doing here is tweaking it so that (1) it’s more relevant for Malaysians, and (2) it suits more life aspirations.

Use these steps to guide your personal finance journey
. Some of you may be at Step 1, some of you at Step 5.
Some of you may find that you’re doing Step 4 when you should really do Step 2 first.

Obviously, do whatever is best in your situation, but if you feel overwhelmed, it’s not a bad idea to follow these 7 steps to help you decide on your immediate next actions.

Let’s go.

Step 1 – Have RM1000 in emergency fund

Estimated time:
 A few weeks to a few months

In this step, your priority is to have some sort of financial buffer against life’s unexpected expenses. If you’re starting your journey here, it’s okay to suffer for a little bit, while you build up your emergency fund.

Some examples include:

Eat instant noodles to save money
Take the cheapest possible option to go to work
Reduce your rent by sharing living spaces with housemate(s)/roommate(s)
Take up low-paying jobs and work without rest
ZERO paid entertainment

Yes, those situations are not ideal, but having no emergency savings whatsover makes you extremely vulnerable, and those sacrifices is still the lesser of two evils.

Whatever you choose to do to have at least RM1000 in emergency fund (more if you can, but that’s the minimum), know that it’s
temporary
.

Once you hit that amount, you don’t have to be too strict on yourself. Don’t sacrifice your physical and mental health for too long, that’s not what I’m advocating here and that’s not worth it at all.

Step 2 – Pay off debt

Estimated time:
a few months to a few years

Now that you have at least RM1k, you can breathe a bit. No matter what, don’t touch that money. That’s your super super in-case money.

Now, it is time to focus on paying off debt, specifically bad debt. In Malaysian context, two of the most common bad debt would be
personal loans
 and
credit card debts
.

A lot of people focus on (1) cutting back on expenses and (2) increasing income in order to get out of bad debt faster. They also avoid, by hook or by crook, accumulating more debt, including avoiding
Buy Now, Pay Later
 installments.

Some of the things you can do:

List out all your debt commitments. The first thing to do is to confront it
Contact your bank for help. They may be able to restructure your payments or suggest a financial product to consolidate your loans into a single payment
Contact AKPK
 for help
Sell your non-essential valuables, if any. Use the money to pay off your debt
Do money challenges (Related:
9 Money Challenges to Try
)
Explore and experiment with
different ways to save money in Malaysia
Implement debt payment strategies

Remember: you’re not alone in this. Lots of Malaysians are on the debt-free journey. Lots of people post their updates and progress on instagram under the hashtag #debtfreemalaysia

Unfortunately, it is not uncommon for some people to start Step 1 all over again. Financial emergencies happen. It depends on luck and chance.

The only thing I can say here is… Doing is hard, but
not doing is harder.
 Dust yourself off and do it again.

Step 3 – Build up 3-6 months of emergency savings

Estimated time:
A few months to a few years

Now that you’ve got your high-interest debt paid off, your focus is to grow your savings. That’s 3-6 months of monthly
expenses,
not 3-6 months of monthly
income
. That needs to be said as some people spend more than what they bring in.

This step, you can do at your own pace,
you’re no longer racing the clock
. Fast is good, but slow is fine too. Slow progress is better than no progress.

In fact, I’d argue that it’s better to be slow and focus on (1) having
insurance
 and (2) improving skills and increasing income than to complete this step as fast as possible. As we can see in this pandemic, if both also don’t have, then 12-24 months’ worth of expenses may not even be enough…

There are two main ways to earn more:

Through day job –
http://ringgitohringgit.com/earning-money/high-salary-in-malaysia/
Through side income –
http://ringgitohringgit.com/earning-money/side-income-malaysia/

The money, in my humble opinion, should be kept at places that are easy enough, yet hard enough to access. Here are some good options to put your emergency money –
5 Best Places to Save Money in Malaysia, Ranked

Step 4 – Invest your money

Estimated time:
lifelong

Now,
finally,
 we have arrived at the investment part. If you’re efficient, you’re already investing at Step 3, by doubling your savings-earmarked accounts as low-risk investments. But if not, use this article as a guide –
3 Best Investments in Malaysia (+ The Best Way to Invest Your Money)

Important: Whatever you do, do NOT skip Steps 1-3!

Now, there’s this… misconception… that investing can make you rich. Well yes, but don’t get too obsessed with it until you forget about earning. Getting ‘just’ 5% ROI on RM10000 (RM500) is better than getting 50% ROI on RM100 (RM50).

So, at this stage,
aim to earn more so you can funnel more into your investment accounts
(Go back to Step 3 for earning tips). Start with 20% of your income*, then grow your income so you can contribute more.

*This follows the
50/30/20 budgeting guideline

Credit: The Financial Diet https://thefinancialdiet.com/the-50-30-20-budget-what-it-is-why-you-need-to-start-using-it-asap/

Step 5 – Save for children’s college / another big life goal, &

Step 6 – Pay off house / another big life goal

Estimated time:
lifelong, up until you hit your goals

Okay! Here’s where my tweak comes in. In Dave Ramsey’s original Baby Steps, he clearly placed saving money for children’s education and paying off your house mortgage as necessary steps. And it is, for some of us.

But here’s the thing –

Malaysia’s education system is WAY LESS PREDATORY than the US’s education system. That’s not a blanket statement, but generally true
Not everyone can afford to buy a house in Malaysia, given how the property market is (over)priced and our salaries are not increasing and all

Therefore, in Steps 5 and 6, you can choose your own life goals. Make it early retirement, saving up for your children’s education, make it buy a house, or
make it anything you want, any life goals that are meaningful to you.

Some of you may have ‘have enough money to start own business’ as a life goal, that’s cool. Others may decide on affording a once-in-a-lifetime adventure. That’s cool too.

Don’t know your life goals yet? That’s okay. You don’t have to have it all figured out yet, and even so it’s okay to change your mind later. Just put ‘accumulate RM1 million’ as a financial goal first while you think of what you want in life.

(And lol you can even make your life goal, ‘save enough money to take 1 year off to travel around the world to figure out your life goal’. What’s stopping you from doing that? No one!)

Bonus section: How much money do you need for financial freedom in Malaysia
Ok, I’m going to dedicate a section to calculate the amount of money you need for financial freedom in Malaysia because it’s a question I get VERY often. But first,
What is the difference between financial freedom and financial independence?
The definitions vary, but I like how
this article on financial freedom vs financial independence
 illustrated it:
So essentially, what financial freedom means is
working is optional
.
How you feel about this totally depends on whether you like your job or not. For some people, the motivation to reach financial freedom comes from hating their job, so they work REALLY hard to earn more AND live as frugally as possible.
Personally, I don’t totally hate my job (it’s great 80% of the time, which is more than I hope for), and I love spending money on experiences. It will take longer for me to reach financial freedom, and that’s OK. (This is also why I’m not super into the financial independence, retire early (FI/RE) camp, with emphasis on early retirement.)
Financial freedom calculators in Malaysia
Many websites offer financial freedom calculators – or should I say retirement calculators.
This one by Multiply
 is really good.
You can see my attempt at calculating the cost of my retirement here:
Calculating the Amount I Need to FI/RE in Malaysia
P/s – It will be a big number. Bigger than you’d want. I *was* intimidated by it, but now I’ve accepted it. I’ve made my plans so all I have to do is follow them and enjoy the ride.

Step 7 – Give back

Estimated time:
lifelong, up until your time to go

Step 7 is giving back. THIS DOESN’T MEAN YOU SHOULD AVOID MAKING DONATIONS UNTIL YOU REACH THIS STEP!! Maybe don’t do it while you’re still at Step 1, but go on ahead from Step 2 onwards. I want you to be happy throughout all this and the act of giving increases happiness – read
How to Buy Happiness: 5 Science-Backed Principles to Know TODAY
 for more info.

As I understand it, giving back in Step 7 means
not hoarding wealth and contributing to wealth inequality
.

You may choose to expand your business and hire more people, paying them comfortable salaries. That’s a way to give back.

You may make regular contributions to a women’s shelter, or a pet adoption society. That’s a way to give back.

You can be an angel investor and fund businesses. That’s a way to give back.

Use your money and wealth to enable others. As the saying goes, you can’t take it with you when you go.

Achieving Financial Freedom in Malaysia

I’m going to be hella realistic.
Not everyone can achieve financial freedom in Malaysia
. Some of you may get stuck at different steps. Some of you may have exceptionally bad luck in life and have to restart the journey over and over again.

Still, with this information you at least have a fighting chance, and that’s all we can hope for at this point, right?

Let me know if you have questions about the 7 baby steps to financial freedom above. Does it help you to focus on your next immediate action(s)? Which step are you at now? Let me know in the comments section!


13 Types of Financial Tools I Personally Use (How About You?)

The other day I was listing out all the financial tools that I personally use for money management in my notebook, and the list got kinda long.

I did that list because (1) it’s good to know exactly what I have and what I use it for and (2) I don’t want to accidentally
forgot
 about an account, which happens more often than you’d think (
that’s why there’s over RM5.77 billion in unclaimed money???
).

So here you go – an article compiling all the financial tools I use for my own money management. Please don’t @ me if any of them sucks for you – they’re just the best option for my situation right now
– I’m not loyal to any of them and happy to switch to better solutions as and when it suits me
. Also please don’t take anything here as investment advice.

The financial tools are arranged in this order:

Bank account

Credit cards

Debit cards

Prepay cards

E-wallets

International money transfers/payments

Investment

Retirement

Insurance

Estate-planning

Accounting

Budgeting app

Shopping

#1 – Bank Account

Primary bank
:
Maybank
.

I have 3 savings account in there: (1) for daily use, (2) for work/business-related transactions, and (3) the one which I’m too lazy to close down. I might repurpose the last one and earmark it for travel savings or something, let’s see.

Secondary bank
:
CIMB
. Only one account. I only add money to this account if I need to pay off my CIMB credit card.

IMPORTANT: I did not open accounts at both banks by choice. I ended up with Maybank because my parents opened up a Maybank Yippee account for me when I was in primary school, and ended up with CIMB because my university required me to have a CIMB bank account to receive PTPTN money.

I’d say I’m fairly happy with them, but always wondered how different the experience would be with other banks.

#2 – Credit cards

I’m a big fan of credit card as financial tool – love the cashback, points and other perks.

Credit card #1:

Maybank2 Gold Card Amex card
. Only for personal use.

Credit card #2:

Maybank2 Gold Card Mastercard
. Only for business-related expenses. Credit card #1 and #2 came together as a set.

Credit card #3:

CIMB Cash Rebate Platinum Mastercard
. Backup credit card.

I’m biased, but the
Maybank 2 Gold Cards
 mentioned above is an excellent starter credit card.

Related:
Best Credit Cards in Malaysia: 5 Maybank Cards You Recommended

#3 – Debit cards

Debit card #1:

Maybank Visa debit card
.

Debit card #2:

CIMB Mastercard debit card
.

I withdraw ~RM500 in cash every so often just to be safe. We’re not quite a true cashless society yet.

#4 – Prepay cards

Like many of you, I use
Touch N Go cards
. Used to have a few of them until I lost all but one. The one I use now is the MyNews-branded one and it’s good – no RM0.50 charge for topups made at MyNews stores.

Edit: I dug out the Twitter thread about the time I lost my TnG card. Thanks everyone who advised ways to recover the lost amount (hint: keep the receipts, register the serial number)

Have you registered your details on TnG website? I lost mine also before. Called them to block the card & transfer remaining balance to my bank account.

— P&C FTT (@NadeadelaVega)
July 14, 2018

I also enjoy using BigPay cards for both international travel and online shopping. It’s especially handy for signing up for recurring payment that you DON’T want to coninue paying – just freeze the card when not it use and the payments will simply not go through.

Shoutout to BigPay card for blocking a recurring payment I forgot to cancel

Shoutout to myself for remembering to freeze the card when not in use
pic.twitter.com/bHqVYTSnmD

— Suraya | suraya.eth (@surayaror)
November 1, 2021

Obligatory referral code: INLALP7ZLE (or click direct link in
http://
linktr.ee/surayaror
)

#5 – E-wallets

Obviously, I have
the Big Three
: Grab, TnG e-wallet and Boost

I also use other e-wallets as and when it suits me. In terms of e-wallets, we’re quite spoilt for choice actually.

Related:
Best E-Wallets in Malaysia: Comparing 38 E-Wallets in 7 Categories

#6 – International money transfers/payments

(I have this because I sometimes work with international clients)

To receive money
:
Paypal
 and
Payoneer
. The former is practical (it’s integrated everywhere) but the latter is the better deal to receive payments – they have lower withdrawal fees.

Receiving money online: Payoneer vs Paypal

Current rate is USD1 = RM4.19

Payoneer’s rate USD1 = RM4.1106

Paypal’s rate USD1 = RM4.07979

Payoneer has better rates
pic.twitter.com/xPtAqvLfRn

— Suraya Zainudin (@surayaror)
May 29, 2019

I also use crypto wallets to receive payments in crypto. Working for crypto is how I accumulate most of my stash actually. Related:
6 Ways to Get Bitcoin for Free (for People Bullish on Bitcoin Price)

#7 – Investments

(I’m going to keep this section short and sweet. Instead of justifying each of them, here’s
the best investments in Malaysia.
 I also prefer
Shariah-compliant investments
)

Mutual fund/Unit trust:
ASB (took RM50k
ASB loan
 when I was 23); Tabung Haji,
Best Invest

Roboadvisor/ETFs:

Wahed Invest
 (I like that it includes US stocks; use code ‘surbin1’ to ger RM5 upon
opening new account
);
MIDF Invest
 (same; got it for the exposure to US stocks market too. I got the S&P 500 Shariah).

Gold:

HelloGold

(primary; digital),
Maybank Gold Investment Account
 (secondary; digital) and gold jewellery (not considered investment, but rather sentimental pieces; physical).

Related:

What You Should Know About Gold Prices In 2008-2018

20+ Interesting Gold Coin and Gold Bar Designs

Crypto:
 Bitcoin, Ether, and a few more. Divided across a bunch of accounts, including cold wallet and multiple exchanges

Related:

The ULTIMATE Cryptocurrency in Malaysia Guide

Which Cryptocurrencies to Invest In? 3 Ways I Use to Decide

P2P Financing:

Funding Societies
. Tbh I like this investment and the profit is decent but I’m trying to phase this out as it’s my only non-Shariah compliant investment left

Related:
I Asked Hard Questions to the CEO of Funding Societies Malaysia

#8 – Retirement

Unit trust:
Like many of you, I have EPF/KWSP. I also contribute to Private Retire Scheme ( via Fundsupermart). I consider these two the
best investments in Malaysia
 and the ones you have to do before everything else.

#9 – Insurance

Medical card:

AIA Public Takaful.
 It’s a stand-alone medical card, without investment link. I heard my particular medical card was discontinued but they will still honour existing policy holders so don’t ask me where to get it.

Personal accident
:
EZCover Takaful by MAA Takaful
. Found and applied for it online.

Critical illness:
Takaful Term 80 by Zurich Takaful
. Recommended by my financial planner

Please note that all of my insurances is taken on my specific requirements and needs, which may be different than yours. How to get the best one for you? Well, you could (1) find insurance agents and let them recommend the best plan based on your budget, (2) hire a
financial planner
 (best option IMHO; but need to pay), or (3) do DIY research (start with below articles)

Related:

4 Best Insurance in Malaysia (Especially Curated for B40 and M40)

9 Things You MUST Know Before Buying Insurance in Malaysia

[SPONSORED] Learn Critical Illness Insurance in 5 Minutes

Investment-Linked Products, As Explained By the CEO of Life Insurance Association of Malaysia

#10 – Estate-Planning

Wasiat, Hibah and Trust
: Working on it! I need to do this because I’m not a big fan of faraid aka Islamic inheritance laws. It’s meant to be fair, but often not during implementation.

Related:
Wasiat, Hibah, Trust: 3 Tools to Circumvent Faraid / Islamic Inheritance Laws in Malaysia

I also want to set up
Hibah Takaful
 soon. Imagine only paying RM50 or so per month to leave behind 6-figures to loved ones.

#11- Accounting

Accounting software
:
Financio
 (I mainly use this to generate invoices; probably under-using my account tbh) and
Google Sheets
 to record Business Income and Expenses.

#12 – Budgeting app

I use Money Lover, the expense-teacking app. The graphs in my
monthly budget updates
 all came from this app 🙂

Related:
How Expense Tracking Looks Like (As Someone Who Doesn’t Budget)

#13 – Shopping

I pretty much never buy online without checking
Shopback
 first.

Related:
Shopback Malaysia Review & Tips for Shopping Enthusiasts

That turned out to be a long list of financial tools..

That was a long list of financial tools, wasn’t it? I’m tired, but glad that I wrote all of that down.

A few things that are immediately clear:

Wow I use a lot of different companies for different things.
 Not surprising – different companies specialise in different things. Thank goodness I use a
password manager
 to keep track of all my passwords, or I’d be overwhelmed and paranoid over security!

These are not the
only
 financial tools, products and services I’ve tried.
 I have abandoned some which didn’t impress during the experimentation process. If I include those, this list would easily be at least twice as long!

What I want to know now is – which financial tools do you use? Is it similar to mine? Share in the comments, I’m really curious to find out!


30 Healthy Financial Habits You Should Have by 30 [SPONSORED]

Which healthy financial habits have you cultivated, and which do you still need to implement? Go through this checklist and find out what you need to work on next.

1. Calculate your monthly expenses

You should have a rough idea how much you are spending every month, for both
fixed expenses
 (the same amount every month, like mortgage and insurance) and
variable expenses
 (amount varies every month, like dining out and car repairs).

Don’t forget to add in expenses charged on
irregular basis
, such as quarterly, bi-annual, and annual payments too! If you don’t know the actual amount, an approximation will do.

Image credit: Mimirello

2. Save up for 3-6 months’ worth of living expenses

Your monthly commitments form your living expenses. Now that you know the amount, you should aim to save up for
at least 3-6 months’ worth of expenses
, as a buffer against life’s unexpected costs and emergencies.

Calculating how much you need to save up is easy:

If your monthly living expenses is
Then 3 months’ of living expenses is
And 6 months’ of living expenses is
RM500
RM1500
RM3000
RM1000
RM3000
RM6000
RM1500
RM4500
RM9000
RM2000
RM6000
RM12000
RM3000
RM9000
RM18000

Have you saved up the amount yet? If no, that is one of your financial priorities.

3. Keep living expenses in low risk, liquid accounts

Funds earmarked for living expenses should be kept in
low risk, liquid accounts
 – that is, the value does not wildly fluctuate on a daily basis and it is easy to be converted into cash.

Some good places to keep this money include:

high-interest savings account,
cash management account with no withdrawal fees or penalties, and
ASNB fixed priced funds (ASB and ASM are both good choices)

4. Save up for a big purchase (rather than financing it with debt)

A big part of being financially responsible is
planning ahead of a big purchase
. Not buy first, figure it out how to pay it later.

Whatever big purchase you are planning to make – a downpayment for a house, a trip, a wedding, a renovation, a gadget, whatever – calculate how much you need to set aside monthly so you can achieve your goal.

For example, let’s say you want to go on a trip costing RM5000. It will take you:

100 months at RM50 saved per month
50 months at RM100 saved per month
25 months at RM200 saved per month
12.5 months at RM400 saved per month

And so on.

Note: For simplicity’s sake, interest/profit rates are omitted from calculation.

5. Save up for retirement as early as possible

If you need RM2,500 per month in living expenses now, that means you need
RM7,067 per month
in living expenses in 50 years’ time.

Yes, per month.

That’s why you keep hearing how inflation is a ‘silent killer’ and how important it is to save for retirement as early as possible.
You will need all the time you can get to grow your savings and hedge it against inflation
.

Whether you are employed or self-employed, it is a good idea to save for retirement in both EPF and PRS, so you can claim income tax relief from both.

AIA offers PRS – check out the
AIA Private Retirement Scheme and its benefits
.

6. Save up for children’s future
 (if you have children)

According to
University Cost Guide 2022
 published by Public Mutual, the cost of tuition fees and living costs rises between 1.7-5.6% annually, depending on the education inflation of each country.

If you want to send your child to countries like Australia, Canada, United Kingdom and USA for further studies, you can
expect the total cost to double in approximately 12 to 15 years
.

Plan for your child’s future as early as 14 days old with AIA’s child protection and savings plans, A-Life Joy Xtra and A-Life Wealth Treasure. Check out the products
here
.

7. Use financial calculators

Make use of various financial calculators online. They can help you calculate how much you need to set aside per month to achieve your retirement and savings goals, among other things.

Some of my favourite financial calculators include:

AKPK’s tools
: Budget Calculator, Credit Card Calculator, Housing Loan Calculator, Hire Purchase (Car) Calculator and Net Worth Calculator
AIA’s Financial Health Check (see #8, below)

8. Regularly review your protection coverage levels
 (with AIA Financial Health Check)

You may have outgrown the insurance coverage you took in your early 20s, so it is important to
review your protection
 regularly, especially after big life milestones like marriage and having children.

Take AIA’s
Financial Health Check
 to find out which of your coverage – Life, Medical, Accident, Critical Illness or Savings – needs immediate attention.

I took the FHC assessment myself and it says people similar to my demographic profile have the following coverage:

RM450k in life insurance
RM1.5million in medical insurance
RM640k in personal accident insurance
RM250k in critical illness, and
RM20k in savings

From the results, it is clear that my current protection coverage (which I got when I was younger) is outdated, and I should prioritise updating my Life and Medical coverage. This will ensure my wealth is protected if I am faced with unforeseen circumstances.

9. Learn about yourself

Learn money management tips that work for you rather than against you.

Are you a saver or a spender?

A novelty seeker or set in routine?

Do you desire luxury goods and experiences or are you happy with a simple life?

Do you prefer DIY money management or seek professional advice?

What are the most important things in life for you, and are you allocating your funds accordingly?

These are questions that invite you to reflect who you are as a person – no answer is better than the other, nor are there ‘perfect’ answers, just what works for you.

10. Build your credit history

No matter which method(s) you pick to build credit history – via PTPTN loan, via credit card, via hire purchase or others – make sure to
pay them in full, and on time every month
.

11. Pay off all high-interest debt

If you have credit card outstanding balance or personal loan, forget everything else on this list. Your number 1 priority is to pay off your high-interest debt first.

12. Check your credit score

After a few years of building credit history, your credit score will be available. This score determines how ‘creditworthy’ you are –
the higher the score, the better the rates you will get from banks when applying for loans
. This will be very useful when (if) you plan to purchase a house and need to get a mortgage.

Malaysians can purchase comprehensive credit score reports from Experian, CTOS and Credit Bureau Malaysia. You can also
check your CCRIS for free
.

13. Keep Housing, Transportation and Food costs to below 50% of your income

For most people,
Housing, Transportation and Food are usually the top 3 expenses
. There are many strategies to keep these costs low.

One of the best ‘hacks’ to keep these three expenses low is to find jobs that allow remote/hybrid work arrangements and live:

at areas with affordable eateries/amenities OR
within walking distance to bus/LRT stations OR
within walking distance to work.

These options eliminate or significantly reduce the need for a car,
saving at least RM1000 per month
. In addition, the time saved from commuting can be diverted to home-cooking and meal-prepping, reducing eating out expenses as well.

14. Decide to rent or own a house

Rent or buy a house? Both can be good financial choices, it all depends on the situation.
Don’t let property agents/ your parents/ other people peer-pressure you into owning a house before you’re ready
*.

*Practically speaking, ‘ready’ means having at least RM50,000 or so in funds without touching 3-6 months of living expenses, retirement funds and children’s’ funds. If you’re not paying that much for down payment (plus legal fees), you’ll be paying for renovations and move-in costs.

15. Learn to cook at home

Even if you did the calculation and eating out is cheaper in terms of ringgit cost, it is still worth learning how to cook because of one simple reason:
 home cooking tends to be much healthier.

It’s true. Most restaurants use a lot of oil, sodium and sugar in their food – delicious, but will contribute to health problems in the long run.

16. Exercise regularly

In the theme of healthy living, it is worth adding in physical activities are essential to better health and directly correlated to improved quality of life.
Don’t neglect your health as you are accumulating wealth
.

Note:
AIA Vitality
 rewards you for leading a healthy lifestyle. View the discounts and benefits under
AIA Vitality
.

17. Don’t just save, find ways to earn more too

If you are earning minimum wage or if your commitment is high (due to reasons like: medical, caretaking duties etcetera), then your priority is earning more, not saving more.

Unfortunately, you
can’t budget your way out of poverty
. If emergencies doesn’t, cost of living and inflation will wipe out your savings.

18. Explore side income opportunities

Side income opportunities deserve an article on its own, but let me take this chance to warn you against opportunists who scam or mislead people looking to earn extra money.

Don’t be swayed by people who dangle high income potential while selling four-figure courses.
You can absolutely get started with zero cost
, and there are amazing free/cheap courses out there that are just as good (if not better).

Some websites to explore gig work include goget.my and swifty.my.

19. Update your resume

The best time to look for a better paying job is when you are not looking for a job.
 Don’t stop yourself from getting job offers with potentially 50-100%++ pay increase – add your new skillsets in your resume and make it public; recruiters are always looking for talent.

20. Attend a resume-writing workshop

Make recruiters’ job easy by adding in keywords employers are looking for in your resume.
The easier they find you, the more offers you will see coming your way.

21. Sort out estate planning

They say you should sort out estate planning for the benefit of your loved ones, and that is a good reason in itself.

But in addition to that, as someone who has made progress with estate planning, it feels great to make the decision myself.
 It’s a privilege to get to decide who will get my money, assets and takaful, instead of leaving it up to default inheritance laws.

My advice: unless you are familiar with legalese, do yourself a favour and consult professionals. AIA customers can enjoy
discounts on will and wasiat-writing service, as well as on the insurance/takaful trust setup fee
.

22. Join personal finance communities

There are personal finance communities across basically all social media. A good indication of a healthy online community is it is
not centred around a cult of personality
 – that is, a leader that promotes only their particular type of methodology, investment or money management style.

If they (and their followers) insist theirs is the best, and the rest is wrong, then find other places encouraging more viewpoints.

23. Learn to say no

Most people are good, but some will try to take advantage of you.
 Learn how to say no because there are scammers, manipulators and guilt-trippers out there asking to ‘borrow’ your money or worse, get/guarantee a loan under your name.

24. Learn sales strategies

There are two good reasons to learn sales strategies. First, you can use the skillset to make money, which is always handy. Second, and more importantly, is
so you can identify when it is being used on you.

For example, giving free samples is a great sales strategy because it is based on the principle of reciprocity – people generally like to return favours, so they might end up buying the product the next time they see it.

25. Read personal finance books

As great as online resources are (much of which are free), you will get a better understanding of personal finance from in-depth resources, a.k.a. books. There really is no substituting it.

26. Learn income tax strategies

Whether you are employed or self-employed or a business owner, there are ways to optimise your taxes. Depending on how much you earn, the savings can be in the thousands.

Muslims in particular should know how to claim zakat as tax rebate. This in itself will save you a lot of money.

27. Find low-cost or free leisure activities you enjoy

It would be a problem if you feel like you need to splurge every time you are stressed. Find low-cost or free leisure activities that you can do instead.
 ‘Reward yourself’ doesn’t have to be expensive.

28. Pick a conscientious life partner

Your life partner selection is one of the most important financial decisions you will ever make.

The heart wants who it wants, but if possible find
someone conscientious
. They tend to be more disciplined, organised and responsible in life and money.

29. Hire a financial planner

As much as you like DIY-ing your finances, after a certain point, go meet a financial planner. They’ll help you
find the blind spots you missed
, if any.

30. Engage with a reputable financial services company

There are many companies offering financial services. For something as important as wealth planning and protection,
there is value in choosing a reputable and well-established company like AIA
.

Not only do they have the experience, but they also offer varied services under one roof so you and your loved ones can live Healthier, Longer and Better Lives. Learn more about AIA’s
Total Wealth Solution
 and what it can do for you.

And there you have it, 30 financial habits you should have by 30. The more financial habits you implement, the better your financial future will be. What other habits do you think should be added to this list?