Personal Finance ChitChat
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Answering All 45 Questions from #Hann&Suraya: Personal Finance ChitChat (BNM/FEN Collab)

On 28 October 2020, Hann Liew from RinggitPlus and I appeared on the #Hann&Suraya: Personal Finances ChitChat, the financial literacy webinar organised by Bank Negara Malaysia and Financial Education Network.

#Hann&Suraya: Personal Finances ChitChat

We managed to answer 19 audience-submitted questions, live. I’ve uploaded the full video in RinggitOhRinggit Youtube channel. Here are the questions, plus shortcuts:

  1. 9:50 – What financial myths do you want to address?
  2. 13:15  Is Investment-Linked Products (ILPs) worse for me? How do I know which insurance is for me? (Related: Investment-Linked Products, As Explained By the CEO of Life Insurance Association of Malaysia)
  3. 16:20 – Where should I invest scholarship money?
  4. 18:15 – What’s the most reliable way to pay off debt? (Related:¬†Explaining Snowball Method, The Best Way to Pay Off Debt)
  5. 22:00 – Any interesting stories from followers during Covid-19 and MCO, to motivate us?
  6. 25:40 – I’m in my 30s. Thinking of buying a house. Should I?
  7. 30:00 – Share practical money management tips going into the new norm
  8. 36:10 – Since moratorium ended, is it advisable to pay deferred payment or follow schedule?
  9. 38:30 РWhat should I do about MRRT application? 
  10. 41:30 – How can I help my friend, who has a gambling addiction, and cannot pay more than minimum for credit card debt despite earning well?
  11. 45:20 – I’m B40. Income is more important than financial literacy. Thoughts?
  12. 48:10 – How to create awareness among friends who don’t take financial management seriously
  13. 49:40 – Can share about debt consolidation loans?
  14. 52:25 – What’s your biggest financial mistake?
  15. 56:40 – How should we save for emergency fund?
  16. 58:30 – How to psycho ourselves into not spending unnecessarily?
  17. 1:02:30 – How to talk to your parents on money management?
  18. 1:05:35 РHow do you discuss with spouse/future spouse about financial arrangement after marriage? (Related: [VIDEO] BOYFRIEND TAG (Actually Fiancé): Should We Combine Our Finances? & Other Money Questions)
  19. 1:08:05 – How do you strike a balance between savings & investing?

Due to overwhelming response and time limitations, we couldn’t answer all questions received. But no worries – let me take this opportunity to address the other 26 questions received here ūüôā Find my answers to your questions below!

Q20 – How do you define Financial Freedom?

To me, financial freedom is when I  reach Step 7: the ability to give back generously without experiencing any financial setback.

You can read Steps 1-7 in this  Guide: 7 Steps to Achieve Financial Freedom in Malaysia article.

Q21 – Do the public (Malaysians) needs a Certified Financial Planner like a developed nation need for each of the family?

I hope we never reach the state of ‘needing’ the services of Certified Financial Planners – that means the financial system and policies are too predatory or complex for the average person to navigate on our own. Our environment should encourage good financial behaviour and results in the first place.¬†

This is my opinion, after reading the book Nudge: Improving Decisions about Health, Wealth, and Happiness by University of Chicago economist Richard H. Thaler and Harvard Law School Professor Cass R. Sunstein.

Q22 РWhat do you both think about earning more than one income and side hustles? 

I’m a big fan of multiple sources of income!

Q23 – Celik kewangan untuk semua, bukan untuk kumpulan tertentu sahaja. Saya berpendapat buat sembang dalam bahasa Malaysia

Betul. Ahli FEN banyak buat inisiatif kewangan, termasuk dalam Bahasa Malaysia. Boleh lihat di sini. 

Q24 Р How to manage spending given tight budget?

You can browse all my articles on saving money. The fastest way is to significantly reduce the top 3 expenses: Accommodation, Food and Transportation. It’s ok to ‘suffer’ temporarily so you can save up for the initial emergency funds.

If that doesn’t work and you have nowhere else to save, you have no choice but to earn more. Here are all my articles on earning money.

Q25 – What would be your advice for me (fresh graduate) when I receive my first salary later? Apart from all the priority expenses, what should I do with the balance?

Regardless of where you are, the foundation stands – follow this step-by-step Guide: 7 Steps to Achieve Financial Freedom in Malaysia article.

Q26 – How to properly educate average level people to gain more income from Financial Market rather than add up commitment to Financially Survive in current situation

I don’t know about you, but I wish knew all these things earlier: 4 Money Making Tips I Wish I Knew Earlier

Q27 – I am in my 20s. Do I start saving for retirement now (besides EPF)? If yes, how do I ascertain how much I must save?

Personally, I’m saving for my retirement via EPF and PRS accounts. You can read more about them here:¬†3 Most Practical Investments in Malaysia (Prioritise These Over Others)

As for how much to save up for, I realise that ‘as much as possible’ isn’t a good answer (even though it’s true). But you can make use of financial calculators from EPF website. They have a bunch you can use to have a rough figure.

(Note: it’s very normal for your ‘amount needed’ to change over the nears, as your commitment/lifestyle change)

Q28 – Tips to manage and prioritise budget during difficult time / Can u share tips in managing & prioritising spending esp if u r experiencing financial constraint?

Most people already know the answer. To make a budget.

Equally important, I think, is to make the experience as fun and positive as possible. The reason is because stress encourages bad (financial) decisions, including impulse purchases (we have all bought something we shouldn’t have when we’re sad, haven’t we?)

In that regard, it’s worth reading the real ways that money buys happiness:¬†How to Buy Happiness: 5 Science-Backed Principles to Know TODAY

Q29 – Can you suggest what skills we should acquire during the pandemic in order to sustain ourselves as side hustle?

Start by monetising your hobbies, rather than entering a completely new industry. A lot of skills are transferable and at least you have expertise and/or knowledge and/or passion you can leverage on.

Q30 – Prices in Malaysia are going up and jobs are going down. How do I best protect myself from this?

I think you already know the answer – find high-paying jobs. This article may help: 3 Ways to Get A High Salary in Malaysia

Q31 –¬† What do you think about the role of financial stress on relationship between financial problem and wellness among Malaysian.

I’m not sure what you mean exactly by that question, but I’ll answer it in this way: I think financial stress is the reason why there is so much negativity to financial education initiatives.

I also think its wrong to solely put the blame on personal responsibility. Avoid people/communities who give shame-based financial advice.

Q32 – Online shopping 101: how to manage needs vs wants?

Want to know why everything feels like a need, when they’re just wants? Marketers are really good at figuring out your spending triggers.

Q14 – Hi, would it be wise to take out a personal loan to help me with my financing, or maybe even to cover other urgent debts that I’m still settling? Thank you.

Look up 49:40 Рwe covered debt consolidation loans. 

Additionally, you might find this article of use: 4 Things You Can Do If You Need Money URGENTLY in Malaysia

Q33 – Any tips to be a smart spender? Especially for online shoppers. Ex. Using shopback, pay with eWallet and collect points etc?

Yes, yes and yes. In addition to that, you should also learn how to differentiate between real and fake reviews. See: Online Shopping in Malaysia: My Quest to Find REAL Recommendations & Good Products

Q34 – In this challenging time, should we consider refinance our mortgage to get some extra cash in the event of emergency use during tough time?

You might find this article of use: 4 Things You Can Do If You Need Money URGENTLY in Malaysia

Q35 – Do you think ILP scheme is a good way to get insured and investing at the same time compared to having separate life insurance and invest separately?

Here you go: 9 Things You MUST Know Before You Buy Insurance in Malaysia

Q36 – The best investments for retirement purposes, assuming age above 40 and settled all loans already

All of these options are fairly low risk: 5 Best Places to Save Money in Malaysia, Ranked

Q37 – How can people in lower level of B40 (especially during this pandemic) can get financial security via Takaful? Most of ’em couldn’t afford to commit monthly¬†

There are options for you – see goverment(-linked) and micro-insurance options in 9 Things You MUST Know Before You Buy Insurance in Malaysia article , under #1 ūüôā

Q38 – I took a personal loan to pay off my CC debt. 12.31% p.a for 5 years is it okay? Can I call the bank to get much lower interest?

That’s quite high. Please watch below – we covered the most reliable way to pay off debt.¬†

Q39 – I plan to refinance my house for a loan of RM500k so that I can repay my mortgage loan. It is advisable to do it.

It would be incredibly irresponsible of me to give a direct yes or no; I don’t know the details. Find someone who can crunch the numbers and figure other options for you – Get REAL Financial Advice: 3 Ways to Find Financial Planners in Malaysia

You probably need a neutral third party, because ‘Don’t ask a barber whether you need a haircut’. Don’t ask the loan provider (banks or ahlong) if you need a loan. Of course they’ll say yes.

Q40 – I don’t do investment regularly but rather lump sum. What you think is a good way? Unit trust I mean

Lump sum works too. But I do love me some automation – it takes a lot of the ‘pain’ away. See: Investment Tip | 10 Places to Automate Your Investments in Malaysia

Going to put one of my favourite quotes here, take it however you wish (or don’t): ‘It is better to be consistently good than occasionally perfect’.

Q41 – Your point of view people taking out EPF saving to spend now instead of use it during your retirement days.

I think its a terrible idea and one should try other options than taking the money out but hey what do I know, I’m just a blogger.¬†

Q42 – Is this a good time to make big purchases, such as a car or a house?

Houses and cars are way more expensive than you think. If you see The Real Answer to ‘How Much Should I Spend On A Car?’ article, you’ll see these types of purchases ‘invite’ other expenses, costing up to 2-3x your monthly payment.

But if you can comfortably afford it – and by that I mean all your debt commitments are below 30% of your income, AND your income is stable – then go for it. It’s buyers market, lots of good deals around.

Q43 – Should I invest in safe-heaven asset (gold) or in IAP?

For what purpose??? And I assume IAP means Investment Account Platform (?) – which one??

This question is too general, so here’s a great place to learn about general investing – 10 Best Books to Learn About Investing, According to Malaysians (With Video Summaries)

Q44 – Your view on investment using EPF acc 1

If you mean using EPF money to invest in high-risk investments, I think that’s a terrible idea, but again, what do I know :/¬†

Related: 4 Things You Can Do If You Need Money URGENTLY in Malaysia

Q45 – With current low FD rate, what are the saving or investment options that we can consider, prefer low risk

All of these options are fairly low risk: 5 Best Places to Save Money in Malaysia, Ranked

Thanks everyone who tuned in live or later ūüôā Feel free to leave additional questions here, I’ll see what I can do for you!

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