LOOI KAH FAI asked 6 years ago
Hi KC,
I’m new to investing and I’m glad to have found your website for some local guidance.
I’ve been reading on other financial material on personal finance. Example I Will Teach You to be Rich, by Ramit Sethi. He is from US. I enjoyed his audiobook because it’s motivating enough to get me started.
In there, he talks about Index Fund being Low cost, low fees etc. and I’m interested in it. But I found no material in your webinar here about index fund. Why is it so? Index fund only available in the US?
It would be great if you make a Webinar talking about it, and how it works.
Also,the author talk about 401k and Roth IRA, what’s the equivalent to locally here in Malaysia?
KCLau Staff answered 6 years ago
In Malaysia, there are a few index fund distributed through unit trust channels, and ETF traded at Bursa Malaysia. It is lower cost than most other funds, but compared to the one available in the US, the cost is not that low. If you do a comparison on the recurring management fees, you will see the huge difference. For example, Vanguard Index ETF could be <0.05% but in Malaysia a similar index ETF could be 0.2-0.8% recurring fund management fee annually.
We have a webinar on ETF here: https://kclau.com/webinar/introductory-class-on-exchange-traded-funds-etfs/
Regarding the 401k and Roth IRA provided to US residents, Malaysia has the EPF and PRS.
In my opinion, EPF and PRS is much better than 401k and Roth IRA because of the tax treatment. You don't have to know about 401k or IRA since it won't be applicable to you unless you are a US resident.