Malaysia Money Matters

It's a Malaysian dream to own a property - our culture is not geared towards renting long-term. Renting is considered something you do either as a student / newly working / a temporary solution if you're prone to being transferred - but in the long run, conventional wisdom is to bite the bullet and buy at least ONE property for your permanent residence. So the conundrum lies in the wherewithal for the deposit and attendant costs. To some, the need is urgent and saving up takes too long - so what are your options? The fastest but most expensive: Credit Card cash advance - that baby will hit you with an 18% p.a. interest rate the moment the cash comes out of the ATM. Do Not Use This Method. Please. Even though it pays my salary. The slightly less fast, also kinda expensive but sort-of bearable: Personal Loan - you can take a bigger amount, take a longer time to pay it off and you have that lump sum to help secure the property you want to buy. Only use this method ...

In these times of high prices and low salaries, a lot of people get into financial difficulties when they end up with a lot of credit card debt to maintain their lifestyle. Anyway, no judgement - mistakes happen, I've been there too. The thing is how to get out of it. This is where I think personal loans are not too bad. Well, they are expensive if you take a long tenure but if you know how to use them wisely, they can be very useful. As a banker, these are the tips on how to maximise on your personal loan: 1. Have a clear objective: Such as to clear off your card debt AND that you are going to stop using that card! The lower monthly monthly repayment is meant to relieve your monthly budget and create a set timeline to pay off that amount. 2. Be disciplined: Per no 1, don't run up another debt on another card for goodness sake. 3. Sign up for the lowest TENURE, not the lowest rate: The shorter tenures have the cheapest rates anyway. If you try shopping around ...

A summary post of my thoughts and learnings from buying property and renovating - while there are tons of discussion forums, you'd have to trawl through a whole lot of (rather badly written) comments and sift through the rantings, boastings and fluff to even get a glimmer of useful information. So here goes and hope it helps: The majority of Malaysians prefer to buy brand new properties from developers. There are definitely advantages in terms of lower pricing and the satisfaction of owning something first hand. However, there are hidden costs to it too - primarily the risk of uncertainty that touches many aspects of a new development that includes: Risk of non-completion - this is the worst one, you're stuck with a loan or if you paid cash, you can't liquidate. Risk of non-compliance - I have viewed a 2nd hand property before where the owners have been cheated by their developer: the S&P states that the house dimensions were 22x60 but they only built it to 2...

A little bird told me that Bank Negara is adamant about pushing down the merchant interchange fee by as much as 60% i.e. from 1.2% down to 0.5%! The banks are obviously not happy about it because it is going to be an immediate hit on revenues. However, for those banks who are big on merchant acquisition, the impact may not be as bad IF this drop in rates brings about a large growth in volume due to wider acceptance. So the volume growth off-sets the drop in earnings per transaction. To me, this is a good thing because one of the resistant points towards more cash-less transactions is the merchant rate. Retailer don't want to accept cards for small transactions because they contend (which I think is bullshit) that they don't make money off these. Please, bitch, you shouldn't be in business if that is the case. Unfortunately, this move is one-sided in that it is only about the MDR but the majority of people out there don't even have a credit card (like 70% of the ...

It was bound to happen eventually - the lax way the government wastes money, leakages everywhere and so on. In the long run, this downgrade is probably a good thing. It is a wake up call that we have to DO SOMETHING concrete to move our economy to the next step! Off the top of my head, with but a stroke of a pen, the government should: Impose GST - not just to broaden the tax base but to create more oversight into businesses; lets face it, there's way too much cooking of the books. How can business tax be almost equal to personal income tax? (Govt tax revenue sources by petroleum: business: personal is roughly 33:35:32) Shut down / tightly control the money changers and remittance houses - they are the key channel for fund leaving the country under the radar. Banks have to monitor and report to Bank Negara on fund flows but these organisations don't have to. Why? And it's already proven that funds from corruption by politicians have left the country this way. So ...

As we get closer to the date (who knows when it will ever materialise .... talk about dragging it out), a new article on Malaysia Today links to a so-called campaign by Anas Zubedy  called "No Free Rides" calls for Malaysians to write a letter to their MPs articulating what you would want and then based on their responses, vote for the one who agrees to your wishes (!). Now, I'm rather conflicted about this guy - am not quite sure if he is naive, idealistic, has a hidden agenda, just doing this for attention (for his business) or all of the above. He always comes across, to me anyway, as a mix of smarmy and sincere. Not a good combination, believe me. Anyway, what he's calling for is not wrong - in an ideal world, that really should be how we decide on which politician to vote for.. but practically? Hmm.. Nonetheless, 'tis a good exercise to think through what each of us finds important. Ultimately, what we want is the best for our country, right? So to ...

Many people, including those in the government, think that credit cards are bad, bad, bad. So is fire, doesn't stop you from using it, does it? I would argue that if the rules are set properly (not arbitrarily as they are now), AND taking into account lessons learnt from Taiwan and South Korea on how to jump start your domestic economy but without most of the dire problems that can come with a consumption-led boom, then listen up: But first, some background. There are about 11-12 million working adults in this country. Only about 4 million actually hold credit cards. What about the rest, you ask? Based on the Bank Negara guidelines, they don't qualify due to their lower income or lack of income documentation, say hawkers etc who deal in cash and don't keep proper records. The consequence of that is that these individuals are essentially LOCKED OUT of the formal banking system, so who do they turn to when there is a need for cash - you got it, the loan sharks. Why do...