Many of us are anxious with incoming of 2016 due to many expected hurdles that we need to face. With the rising cost of living, additional cost in taxes and tolls, subsidy reform and other circumstances that could hurt our financial status, many have been asking what are the best things to do to protect our wallets. Hence, I have listed some of my insight to swim through 2016 challenges ahead.
Urgent Steps To Consider in 2016
- Save at least 30% of your income, and invest for a double digit return (more than 10%).
- What should Malaysians invest in for 2016? (Real estate, unit trust, fixed deposits, etc.)
The two assets I keep asking people to invest are business and real estates. For business, it is whether in your own business, or in other people’s business like stocks. These are the two asset classes that you can directly invest in, and get the best return. No matter what cycle it is, you should stay invested, in these two asset class.
Too many people try to time the market, and eventually become disappointed most of the time. Just a quick example, look at the wealthiest people in the world. When the stock market crash, do you see Warren Buffett liquidate his company Berkshire Hathaway and hoard cash? When it is economic downturn, do you see Tan Sri Teh Hong Piow sells his Public Bank shares and stop doing business?
When you master the skill to invest in stocks and properties, you will never be poor. And you will never look at other fancy investment schemes, not even unit trusts.
The best financial product to look out for in 2016
Stocks and properties. There are a few articles written by Mr Koon Yew Yin in this blog about how he made money through stocks, which might be useful for you to understand before going into any stock markets. Whatever decision you make, whether it is stock or properties, just be sure that you are well informed about them before you tie yourself down to it.
Apps or tools for budgeting and personal finance? (Spendbook, Stay on Budget, etc.)
There are a lot of apps nowadays. Some come and some go. I used to try and use some of these apps. Those are helpful as a start. But when you already have a good spending habit, you don’t really need those technology to help you. Nowadays, I just look at my several credit cards statements and I will know what did I do with my money. In our blog, we have many money saving or spending tips, real life stories contributed by our readers that could be useful for you.
Record-keeping and budgeting
Use different credit cards for different purposes. For example, 1 for business use, 1 for personal use, 1 for family use. You can use whatever system that works for you, as long as you have a system.
Another widely used method on cash is the jar or envelope system. You divide the cash into different envelopes for specific categories. Once the money is depleted in the envelope for that category in that particular month, you can’t spend on that category anymore until the next replenishment. That’s how you stick to a strict budget.
What Malaysians must read in 2016
Read books by local authors. There are not many books authored by local authors. What I find is that those books are more suitable to local context and might be the most relevant to you. Besides books, you can also follow other local financial blogs. Recently, Comparehero made a compilation of views and insights by experts on financial tips for 2016, which is vital for you to know.
Power is gained by sharing knowledge not hoarding it
Should you know any tips on how to manage financial or even gain more income, we welcome you to email or share in the comment so more people will be able to benefit, and hopefully we will go through 2016 without much predicament.