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Thursday, December 11, 2008

Major Landslide!

For those who have been wondering why I haven't posted for about a week, this is the reason that I have- I was caught in a landslide! A reason good enough, I hope.

All power and telecommunication to my housing area was cut off. The main road was inaccessible due to the debris from the landslide and the houses that collapsed from the impact of it. Finally we had to come out through a jungle, which was cleared by the army personnels who arrived at the location for the search and rescue operation.

We could see young and old alike trying to vacate the disaster stricken area as soon as possible. In total, 14 beautiful bungalows was destroyed and 4 persons were killed and 1 body still not found in the tragedy. Luckily the number of death was low as it occurred during a long weekend break and most of the occupants were away.

Please bear with me until I get things sorted out.

Wednesday, December 3, 2008

Petrol vs Soda

The current petrol price is at RM1.90 per litre.It is displayed clearly at the station.And I do see it each time I fueled my car. And all this while I've been complaining about it.

However, yesterday as I went to the ATM to withdraw some cash before going to the counter, I picked my favourite soda drink - actually any iced soda drink can be voted as my favourite. I just can't let this addiction go. I paid the amount and walked to the car. As I was walking I noticed the price of this drink - RM 2.10 for a 500ml bottle. It's more than double the price of the petrol!

Let's face it. Petrol for the car becomes a basic need now, I have to pay for it whether I like it or not. Its the means of transportation for me and also it enables me to go to work and make a living.And yet I've been complaining.

On the other hand, I've been spending willingly and unconsciously at the same time for the sodas.And I've been very happy about it.What good does it do? Increase my chances of suffering from diabetes later.Weaken my set of teeth and strengthen the wallet of my dentist. Hmmm... looks like there are no benefits at all on my side.

Something is seriously wrong here. The priorities programmed in my brains is not right at all! All this while I was prepared to fork out money for my wants more than I'm willing to pay for my needs. After this, I should put in some additional effort to control my tastebuds. At the same time save some extra money.

What other things that can fall into this category? Do you have any experience to share? Please share your experience in the comments section.

Monday, December 1, 2008

Some Financial Mistakes You should Avoid As A Parent

It is easy to blame on other people's mistake. But this post is not about that. I love my parents and appreciate whatever sacrifices they have made to bring me up. And without any doubt, they love me too. Just that they loved me and my siblings too much that they unintentionally made some mistakes along the way.

For instance, they never allowed any one of us to work during the school holidays. Even until I was 17! The reason they had was if we earned our own income, we will be too comfortable with it that we would not concentrate on our studies anymore. The problem: we failed to understand the challenges of working life until very much later stages of our lives.

Another issue that I can clearly remember is that they never allowed us to spend our 'gift money' that we received during celebrations or birthdays from friends, relatives and even parents themselves as we like. We were told to put it into our savings. However, if we needed anything, we should ask our parents and if they were okay with it, they would get it for us. The problem: we failed to make our own choices and differentiate between the needs and wants.

They pampered us too much. They tried to provide us with all the comfort that they could. When my youngest brother got a job,my parents insisted that they should send and fetch him. Many times I've insisted that he should stand on his own feet and make use of public transport available, especially when he is 25!

Apart from that, my brother uses the car during the weekends just to go and meet friends and hang-out. I can see the problems arising:
  • he doesn't learn budgeting, because he still gets free rides
  • his time management skills are nil because he gets to tell parents when he is ready to leave and not the other way around
  • once he is very comfortable with driving (parents-sponsored), it is difficult to use public transport.
How is he going to get by when he can't afford all these comforts with his small salary later on?

Saturday, November 29, 2008

Funerals & Weddings In The Financial World

What a title! Some of you may even feel shocked that those two have anything in common at all. After all, they are like worlds apart. One is an occasion to be merry and remembered life long while the other is an occasion of gloominess and brings down tears even from the bravest of all..

Last week I had to attend a funeral and a wedding and I realised that as the world continue to grow economically, people are willing to spend lavishly. And in many customs, weddings and funerals are considered to be a very sensitive and placed in the highest order at the same time. It also represents their status in the community.

You know where I'm heading to, right? Yes. Weddings and funerals these days are becoming a very expensive affair. As to feed their ego, more and more people today spend more than they can afford for their weddings, and they defend their actions by saying, it is only once in a lifetime (and so are funerals!). Whether the parents or the couple to be married themselves are going to finance the wedding function, they seem to forget that life still goes on after the function and there would be more and more expenses coming along the way. Some even go to the extent of taking huge personal loans to cater for this 1-day event!

And if this is not shocking enough to you, nowadays you can even get a burial spot for yourself well in advance. Some people even invest in it and sell a few years later when they get good returns out of it. Funerals are held in pomp and splendour just to show off how what a big name the family has in the society. The longer they have the function and cater for a bigger crowd, it is assumed that their status is higher in the society.

All I want to say is this: whether it is going to be a wedding or a funeral, have it in the most moderate way you can think off.

Thursday, November 27, 2008

How To Increase Your Traffic By 1000% ?

What do you think is the common dream of most bloggers? To increase traffic to their sites, right? Imagine increasing traffic by 1000%. Well, imagine no more.That's what exactly I did to my blog, MoneyChurner.

3-4 days back I was reading SVB's article on agregators and she did mention about a new service, Tip'd. So, I did some little exploring on my own and joined Tip'd.

I'll show you what my stats on Google's Adsense Report looked like before I joined Tip'd. In the screen capture below it shows I had merely 30 page impressions.

Now, after joining Tip'd just after 1 day and submitting 3 articles(which are:My Maid/Servant Is Richer Than Me','How To Retire As A Millionnaire By Investing in Real Estate?' and '4 financial things you should know before getting married'), my traffic stats or rather page impressions in my Google's Adsense account show as below:

Indeed very surprising. It shows page impressions of 310! I myself never imagined that. Maybe there are other ways out there to increase the traffic even further. I have to check it out and definitely share my experience with you all later. Meanwhile, do you believe that you too can make the 1000% leap?

Tuesday, November 25, 2008

Vital To Start Planning For Your Retirement Early

Since this blog talks much about retirement planning and saving for the future, I thought it would be good if I could also put in articles published in the papers. This article was published sometime last year. And I have to agree with the writer, Malaysians as a whole are not prepared for their retirement.
Can you imagine that the money saved for more than 30 years gone in 3 years?

Many young people feel that 'there is still long way to go', or 'let me enjoy my money first'. What they don't realise is that this attitude of theirs is going to cost them dearly in their future, especially when they don't have the earning capacity any more.


RETIREMENT is meant to be a rewarding experience when those who have toiled for decades to raise families and contribute towards nation-building can relax and take it easy.

Retirees are supposed to spend whatever time they have left to do the things they have always wanted to but did not have the time as they had to earn a living.

But the opposite is true in many cases as the majority of retirees are in fact facing a nightmare in just trying to support themselves with the basic things in life.

Their main torment is finance or lack of it. It is estimated that at least 70% of retirees and pensioners were just not prepared to stop work because they could not afford to.

Most of those in the private sector depend on their Employees Provident Fund (EPF) contributions for their retirement. This is almost the only money they have to look after themselves. Unfortunately, it has been proven by none other than the EPF that most of the money would be gone in three years after its withdrawal. This is indeed a very sad state of affairs and the workers have only themselves to blame for their plight.

Very few people have proper planning for retirement. They do not save enough for this purpose until too late. Though everyone starting work should be saving for this purpose as early as possible, they only realise the seriousness of their situation in their 40s or 50s.

Without their compulsory EPF contributions, many of them would have been even worse off with almost nothing to their name. Many have their own homes and if they are lucky, they would have settled their mortgage by then.

Life insurance is still frowned upon by some as not being urgent and in any case not many earn enough to put money into shares, bonds or other saving instruments.

Saving outside of the EPF is not a culture as people may have difficulty in coping with their monthly family and personal commitments financially. EPF contributions are also being drawn to meet the demand for funds for housing and health. This will further limit the money meant for retirement.

Too many are expecting their children to look after them when they retire.They are prepared to use whatever assets they have for their children’s education. Many of them would have been left penniless by the time their children complete their studies.They would then be completely at the mercy of their children. If the kids are filial, then the parents would have a comfortable retirement. If not, then the last few remaining years would be extremely difficult for the retiree.

Some children can be extremely selfish and may insist on going to study overseas though their parents may not be able to afford it. Parents may have to mortgage their house or borrow a sizeable loan for this purpose. They may end up bankrupt if their children refuse to repay the loan.

There are countless such sad stories and these are serious social issues where not much can be done to help. It is impossible to tell those nearing retirement that they should keep some money for themselves instead of using it all to educate their children.

Parents should be practical and realistic. If their children are not academically good enough for university, they should opt for vocational education where they would be able to obtain a skill to earn a decent living.

It is worth repeating this message so that hopefully the message will sink in and those approaching retirement would take measures to protect themselves financially.


Sunday, November 23, 2008

Which option to take, 11% or 8%?

The most heated argument taking place among working Malaysians today is 'shall we agree to the option given by the government to reduce our contribution to the EPF from 11% of our salary to 8% for two years starting Jan 1, 2009 or not'.

EPF (Employee Provident Fund) is a fund created by the government as a retirement fund once the employees retire. It is made compulsory as for some people, it may be the only source of retirement fund. It is currently fixed at a minimum 11% reduction from the employee's salary and a minimum 12% contribution from the employer.

Lowering the rate of employees’ contribution to the Employees Provident Fund (EPF) temporarily is part of the Government’s bag of tricks to stimulate the economy. The idea is to boost private consumption by putting more money in workers’ pockets.According to Government's estimates, RM4.8bil a year will be freed up for spending in the economy if all EPF contributors opt for the rate cut.

It is indeed a good strategy for the short term and good for the country's economy as a whole. More employees who fall under the lower income bracket welcome this move as they are struggling to make ends meet due to the current hike in essential goods after the petrol price shot up lately to its all time peak suddenly.A little more cash at their disposal would definitely ease their burden.

However, the rest of the group or the 'financially savvy' ones are crying foul over this move.Their reason is that it definitely means lesser retirement funds. Bad move in the long run.

For the past few years EPF has managed to give out dividends at around 5%. If you can really discipline yourself, even if you claim yourself to be in the financially savvy group, this move can be seen as an opportunity. How?

If you are earning RM4000, the reduction of 3% in EPF contribution will amount to RM120. That means an extra RM120 in your pocket. Don't spend it. Instead look for ways where you can save and invest this money so that it can give you a higher dividend than the one given by EPF. I believe an excellent investment instrument for this small amount in monthly basis would be the mutual funds/unit trust where you can do a Dollar Cost Averaging for 2 years with this extra cash. Or you can also pay off any outstanding credit card debts as the interest charged is usually very high.

So, now you have 3 options in front of you:
1. Reduce the deductions and spend the money.
2. Stick to the 11% deductions and leave the money to grow with EPF.
3. Opt for the 8% deductions and invest in places where higher dividends are being paid.

Make the right choice and have a comfortable retirement later!

Friday, November 21, 2008

What Can You Teach A One Year Old About Finance?

For a one year old who can barely speak, how can I share with him the knowledge that I'm gaining slowly nowadays about the financial world? My first challenge would be to make him understand what I'm trying to tell him. Then, the next challenge would be to get a response from him. But still, I'm just so eager to transfer him all that I've learnt.

Ok, I have to start somewhere. Maybe not on the compounding interest mentioned by Frugal Dad in How to Teach Compounding Interest to Kids or even the difference in needs and wants as mentioned by JLP in his post : Using Mashed Potatoes To Teach Kids About Money. Those are great ideas, but I'll think I'll save it till my boy is a little older.

For a start, I've decided to teach him that he needs to save money. So, how do I do that? My little boy has a habit of digging into my shirt pocket every day when I return from work, usually throwing off my pen and petrol receipts in the process. So, this time, I had on purpose, some coins in my pocket. Everyday, without fail, we dig into my pocket and discover those coins. And what do we do with that? We head for the elephant-shaped 'piggy-bank' and drop the coins into it. Initially, I was putting in the money. As he grew to hold the coins properly in his fist, I have trained him to 'bank in his savings'.

What do you think he would have learnt in the process? I'm sure he doesn't know what is compounding interest or the difference between needs and wants. Heck, I doubt he even understands what money is at the moment. But I'm very pretty sure he knows that the shiny round thing from his dad's pocket must end up in his 'piggy-bank'. That's sufficient for now, I think, don't you agree?

We have been religiously doing this activity for about 3 weeks now. The only concern is I have to be very careful and pay full attention to him as kids tend to put anything they find into their mouth. Otherwise, I think I have put him on a head-start on financial education!

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Wednesday, November 19, 2008

The Liberta Financial Freedom Challenge

Francois from Liberta has put up a challenge to everyone out there. It is called the Liberta Financial Freedom Challenge. He has also started the Liberta Financial Freedom Support Network, which focuses on Financial Freedom. The people in the network provide support and encouragement to each other so that each individual keeps going on and meets his/her goals of getting out of debt and achieving financial freedom.

Hopefully, I can settle my debts, achieve financial freedom and finally retire as a millionaire. As I've mentioned earlier, setting goals are very important and it becomes easier to achieve them when you have friends around you to give you support and encouragement. So, I'm taking up the challenge. What about you?

Monday, November 17, 2008

How Much Can I Save From The Current Reduction In Food Price?

How much do you think you can actually save from your daily food? Would you be surprised if I said that whatever little money that you saved from breakfast and lunch today could actually provide you with a comfortable retirement? Enjoy going places and relaxing in your own home after retirement with sufficient money for your daily needs. Isn't that wonderful?Maybe you can make use of the current situation. Read on.

Restaurant owners have agreed to reduce the price of 'roti canai' and 'teh tarik' by 10 sen and a plate of 'nasi kandar' by 20 sen, or at least that was what reported in The Star Online. (By the way, 'roti canai' is a Malaysian favourite pancake eaten with some curry and 'teh tarik' is actually a special concoction of tea, milk and sugar and stirred in a special way) This generosity arises from the reduction of petrol prices by the government, which business owners had used as an excuse earlier to hike up the price of almost everything under the sun.

For an average person who has been practising eating out for breakfast and lunch, it means a reduction of 30 sen for breakfast (assuming they have only 2 pieces of roti canai and a glass of teh tarik) and 20 sen for lunch, if he has nasi kandar for lunch. In total, savings for a day amounts to 50 sen.

If working days is considered 5 days a week, then in a month he'll be working 20 days. Therefore, using simple maths, 50x 20 = RM100. Not bad. I didn't realise it can reduce our expense by that much.

Some people are still wondering what to do with their money now. RM 100 savings can easily be used in an investment vehicle such as unit trust or mutual funds. They should make use of the opportunities given, especially now, because the market is all low and is good time to invest. Save a minimum of RM1000 for the initial investment and use the RM100 as the automatic deduction to do dollar cost averaging on your investment.

As for me, how much extra can I save in this particular case? The answer is none, because I usually pack my lunch & breakfast from home itself and I've been saving more all the while. Cheaper and healthier at the same time!

Saturday, November 15, 2008

My Maid/Servant Is Richer Than Me

Yesterday as I was going through the reminder letter for my maid's visa renewal, my mind started doing it's own mathematical calculation. And finally decided to tell me: "Hey Boss, you know what? Your maid is actually going to be richer than you!" How is that possible? I pay her salary, I feed her and provide her accommodation, and how is this even possible, you may ask?

Simple. She is a live in maid from Indonesia and comes from a poor family (obviously). When I employed her from the agency, I had spent almost RM6,000 that includes her visa, insurance, health check-up, etc. Her monthly salary is tied at RM500. That means annually she is getting RM6,000 - net. She has told us once before that she plans to work with us for at least 3 years, if its possible. So, using these assumptions, she will be taking home RM 18,000 at the end of her work term(Without any interest).

This is definitely a huge sum.Especially when she is going to convert it into their Indonesian currency and spend it there. All her expenses while she is with us is born by us, so she does not have anything to spend on or worry about.Her CASH FLOW is so strong! Zero outgoing and 100% incoming. Is she smarter than her employers in financial terms or has she educated herself by reading Rich Dad, Poor Dad by Robert Kiyosaki? If she intends to, she can be a real estate investor and retire as a millionaire as I have disclosed here.

In my opinion, she has done a wise move. Moving on to a foreign country, which gives a higher exchange rate than her own, that too in her young age.The only doubt in my mind is that how is she going to manage her money. If only she invest some portion of it properly in instruments that provide with compounding interest, she can help improve her financial position of her family further.

What do you all think?

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Wednesday, November 12, 2008

God And Money

A man is trying to understand the nature of God and asked him: “God, how long is a million years to you?”

God answered: “A million years is like a minute.”

Then the man asked: “God, how much is a million dollars to you?” And God replied: “A million dollars is like a penny.”

Finally the man asked: “God, could you give me a penny?” And God says: “In a minute.”

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Monday, November 10, 2008

Savings I Made Last Weekend

My house was running mostly on those dimly litted yellow bulbs after the fluorescent lamp's starter burnt off. For weeks, or probably months I was trying to put off fixing those things back. This week I thought, enough was enough. Had to fix them right away! Went to the hardware shop and got a few starters with the holder to fix to the round, fluorescent bulb. Got the ladder and climbed up. Then, when I was half way up, I suddenly realised that I had this phobia of heights and immediately cancelled my plans. Called my brother, who took his own sweet time to drop by.. Gave him some simple instruction on where to slot in those dangling wires, and in a few minutes we were done!

Water was leaking from the tap when we fixed the pipe to the washing machine. Precious water was simply being wasted.
Reason: The washer had worn out.
Changed the washer instead of the whole tap-head. The washer only cost a few cents, instead of the few dollars the tap-head would have cost me.

Called in my younger brother to help me out, instead of the handy-man who would have charged me for his services. My wife fixed us nice lunch & dinner.So it was an all in family affair.

In conclusion, the activities done were saving on electricity,water and workmanship.How much did I save? Got to check on next month's electricity & water bills.

Sunday, November 9, 2008

How Warren Buffet Made His Billions

Warren Buffett is a man who has made millions but he also started working at his father’s brokerage when he was 11 years old, that’s an age when most other kids were playing hide-n-seek and didn’t know how to spell ‘brokerage’..

This financial wizard is by recent estimates, worth $46 billion but how he got there is the fascinating story.

It all began in the family grocery store back in Omaha. Buffett’s great grandfather started the store in 1869 and it was in the Buffet family until 1969, till his uncle finally retired. But it’s at this store, where he began going around his neighbourhood selling gum. This was before his stint at his father’s firm.

Warren Buffett told CNBC’s Liz Claman, “My grandfather would sell me Wrigley’s chewing gum and I would go door to door around my neighbourhood selling it. He also sold me six Coca Cola for a quarter and I would sell it for a nickel each in the neighbourhood, so I made a small profit. I was always trying to do something like this.”.

From small beginnings come bigger things and so after selling gum, soft drinks and working with his father, by age 14, he had bought a 40 acres farm in Washington, Thurston County..

But he confesses that he never enjoyed the farm as much as he enjoyed investing in stocks. But the first stock he bought was “Citi Service preferred stock. I had three shares and made all of $5 on it. I had bought it at $38.25 and then I sold it around $40, it went down to $27 in between and after I sold it at $40, it went to $200!”.

From that poorly timed stock sale in 1944, he learnt a lesson that became his legendary investment strategy - which is essentially - patience pays, so buy them and hold them. He figured out two other critical things about himself in the 1940s - what he is good at and what he likes to do.

This pivotal moment in his journey came in 1956, when he was just 25 years old. This man who was rejected by Harvard and now armed with contributions from family and friends and $100 of his own money starts a limited partnership with seven people.

Over the next nine years, Buffett turned a $105,000 into $26 million - a stunning 24,000 per cent increase! He had invested mostly in textile companies, farm equipment manufacturers and even a company making windmills.

Thirteen years later, Buffett forms another partnership that becomes one of the greatest teams in the history of investing. He convinces longtime friend Charlie Munger to quit his investment partnership to join Buffett as his Vice President of Berkshire Hathaway.

And now with the 82-year-old Munger, Buffett sits on top of the greatest holding companies ever.

So, it’s understandable that this man is looked up to for investment and business advice all the time. But what’s the secret gift he’s got? How does he pick the right investments all the time? He explains, “I look for something that I can understand to start with, there are all kinds of businesses I don’t understand.”.

“I don’t understand what car companies are going to do 10 years from now, or what software or chemical companies are going to win/do ten years from now but I do understand that Snickers bars will be the number one candy company in the US - like its been for 40 years. So, I look for durable competitive advantage and that is hard to find. I look for an honest and able management and I look for the price I’m going to pay.”.

While Buffett’s big acquisitions have made headlines; wise investments in companies like Coco Cola, the Washington Post and Gillette have provided the capital to make those acquisitions possible. Since taking control of Berkshire in 1964, the company has acquired 68 subsidiaries. In March of 1964, Berkshire acquired its first insurance company National Indemnity.

In 1972, See’s Candies for $25 million, in September of 1983, Nebraska Furniture Mart and Borhseim’s in 1989. In 1998, Berkshire acquired Dairy Queen and Geico in January, Net Jets in August and General Re Corp in December. In April of 2002, Fruit of the Loom and most recently Buffett is looking abroad for new business.

Recently, he bought 80 per cent of the Israeli Metal Works Company and he did it without even seeing it. He was approached by the promoter via a letter and what was in that letter convinced him that ‘this was the kind of the person I wanted to do business with and it is the kind of business we wanted to own.’ How does this ‘daring bit of investment fit in with his usual careful way of investing?.

He explains, “I had to size up the business but that’s a background of being in stocks. If you put your whole net worth in stocks when you are 20-21 years old - you have not visited the businesses but you are really analyzing their financials, you are trying to assess whether they have durable competitive advantage, assess the quality of the management and the integrity of the management and then you try to figure out whether you are buying it at a reasonable price and that’s it, that is all we do.”

He’s never had anything lacking - his acute business brain has made him a lot of money. He also feels that the youth of today are living better than John D Rockefeller. His own style remains the same - he lives in the same house for 48 years, carries no cellphone, has no computer on his office desk, does not move around with an entourage.

As he puts it, “I have had everything I wanted all my life. At 20, I was having the time of my life doing what I did. Today, I’m eating the same things I always eat - burgers, fries and cherry coke. Only my clothes are more expensive now but they look cheap when I put them on!”.

At 76, he married his long-time companion, Astrid Menks at a low-key ceremony at his daughter Susan’s house. He is also amazingly healthy for someone on a burgers-coke diet. He’s also surprisingly down to earth. He moves around freely unencumbered by a security detail. He does have a few guards with him during the annual shareholders meeting but he says he doesn’t feel the need to put himself in a cocoon.

Which probably explains, why he wasn’t nervous about visiting a factory in Israel, which is close to the Lebanese border. He says of that visit, “Our plant there is about 8-10 miles from the Lebanese border and there were maybe a rocket or two that hit the parking lot or something like that but it can be dangerous being in this (US) country as well.”.

Buffett is comfortable in Omaha in part because people leave him alone with the exception of a random fan or two. This billionaire doesn’t even have a chauffeur - he drives himself around in a 2006 Cadillac DTS, recently purchased after he auctioned off his old Lincoln Town Car, which was famous for its Thrifty license plate. And no, he does not want a yacht or many mansions. He just wants to be left alone to enjoy a good football game in his sweatsuit on a big screen television - with popcorn.

It’s really no surprise that America’s most prominent investor chooses to live far from the nation’s wealthy-elite in New York, Los Angeles, Chicago and Miami. He says that when he was in New York, he had about a 100 ideas about where to invest but it was over-stimulation.

In Omaha, he needs one good idea in a year and he feels he can think better and with less distraction. He feels there is a sense of community in living there.

His investing theories have been talked about ad nauseum by almost every business/finance writer and is a cottage industry all by itself.

But one he finds closest to reflecting his views is a book written by Larry Cunningham - ‘The Essays of Warren Buffett - Lessons for Corporate America’ is required reading in a one of a kind course start at the University of Missouri School of Business.

The course is called Investment Strategies of Warren Buffett. It turns up Buffett is hot on campus too. The class now in its eighth year and is the brainchild of Buffett’s friend Harvey Eisen.

Harvey Eisen recalls, “This course is a breakthrough in terms of reality meeting academics. I said why don’t we have a course like this and the academics scratched their head and said ‘well we don’t’ and I said ‘why don’t we’ and then we got it done.”.

Dean of the University of Missouri School of Business Bruce Walker bought the idea. He says, “We want our students to be exposed to many different approaches to investing.”.

The Buffett playbook is taught, analysed and written about but it is best summed up like this.

Harvey Eisen explains it, “
Number one - Don’t lose the money and
Number two - don’t forget rule number 1!

Number three - look for unique companies that are hard to replicate - he calls
that a moat around the business.
Number four - he talks about the circle of competence, which means in simple
English, do what you know..

“Everybody in the stock market knows about the economy or about the Federal Reserve. Warren focuses on what he knows and he has made enormous successes at that.”

He does not want his managers to report in at any committee meeting of any kind and he lets them get on with the business of running their businesses. But there is one thing he requires of each CEO. Buffett says, “I asked them to send me a letter, that I would keep in a private place that will tell me what to do tomorrow morning, if they are not alive in terms of their successor.”

But what about his own successor? He says, “The succession plan is very simple. Our board met a few days ago and we talked about that every in single meeting and we have at least three people inside Berkshire, who in many respects will do my job better than I do. I can’t give you the names but the board knows which one of those three they would pick, if something happened to me.”.

Warren Buffett has also given away $31 billion of his fortune to the Bill & Melinda Gates Foundation and he ‘hopes it will accomplish just what they have set out to accomplish. I have observed their Foundation very carefully and Bill & Melinda decided initially they were spending about a billion a year. They have decided they were going to try and figure how they are going to save most lives, relieve the most human suffering.’

Ultimately, that’s what money is really meant for, isn’t it?

Source :

Tuesday, November 4, 2008

How To Retire As A Millionnaire By Investing in Real Estate?

Okay,now let's get down to business.Do you really want to retire as a millionaire and that too by investing in properties? You can, if you really want to. It's not really that difficult. You only need to be disciplined in your savings. The faster you start saving and the more you start saving, the better it is.

All you need to do is from the age of 30 to 60, try your very best to purchase 6 properties worth 100,000 each, with potential of market appreciation. Since our plan is to start at the age of 30, we should have accumulated, over the years of working, at least 25,000. This amount would then be used as the down payment for the property purchased.The remainder can be paid of by taking a 20 years loan.Every 5 years, you have to repeat the same action: Buy a property worth 100,000.The 1st, 2nd and 3rd property would have been paid off by the time you reach 60 years old.So, the rental income that you can get from the properties that has been paid off can be used to pay off the rest of the properties. In fact this enables you to pay off the later properties at a faster pace and not as the initially planned 20 years any more.

When all this is done, you will have a passive income and can retire comfortably. Not to mention that your properties also have potential of having appreciated over the years.

Assumptions made:
- retirement age: 60
- you've got at least 30 years to retirement
- you save around 500 dollars every month: 500x12x5 = 30,000 every 5 years
- rental income is minimum 500 dollars a month
- each property purchased is 100,000 dollars

Warning: You must also be prepared to cover the monthly instalments from your own pocket in case your tenant defaults his payment or when the property is without a tenant. Any cost incurred for repairs must also be born by you.

Sunday, November 2, 2008

4 financial things you should know before getting married

1.How are both of you going to manage your money and your expenses? Is it going to be pool your money together (merged finances- as called by Clever Dude) and pay off expenses or each person is going to have a separate account and take charge of selected expenses?

2. What are the 'sins' that each other are committed to? Is there any type of 'sin' that could suck a major portion of your income? A must have drinking session with close friends every Saturday night or being a broadway musical crazy fan that you can't miss even though you know that will cause you to go on hunger for the next 2 days. You may want to read Clever Dude's Have You Committed Financial Infidelity where he has actually shared his experience and how he actually avoided the fights after marriage because he did that before marriage! Another good article regarding this topic that I just saw : Money, fidelity go hand in hand by Sharon Jayson, USATODAY.COM

3. Are there financial dependent family members from either side who needs to be cared for?In case there is someone who needs financial assistance, it would be wise to declare them earlier to your would-be-spouse. Maybe it is a brother who is wheelchair-bound or a sister who needs dialysis every week, just tell.

4. What are the financial 'burdens' that your partner is carrying over? Maybe your future spouse has yet to pay off his/her education loan which is quite a substantial amount. Knowing how much he/she is committed every month would be good so that we don't make any false assumptions or have any expectations that cannot be fulfilled because of this existing 'burden'.

All the financial things listed above should be openly spoken to your spouse before you get married. This opinion is even shared by Bryce in Don’t Keep Secrets.It is better for both of you to have a clear picture of your financial status in order to have a proper financial planning for your life.

Thursday, October 30, 2008

Wealth, Success and Love

A woman came out of her house and saw three old men with long white beards sitting in her front yard. She did not recognize them.

Then she said, "I don't think I know you, but you must be hungry. Please come in and have something to eat."

"Is the man of the house home?", they asked.
"No," she said. "He's out."
"Then we cannot come in," they replied.

In the evening when her husband came home, she told him what had happened.
So, he said, "Go tell them I'm home, and invite them in!"

The woman went out and invited the men in.
"We do not go into a house together," they replied.
"Why is that?" she wanted to know.
One of the old men explained. "His name is Wealth," he said pointing to one of his friends, and pointing to another one he said, "This man is Success, and I am Love." Then he added, "Now, go and discuss with your husband which one of us you want in your home."

The woman went in and told her husband what was said.
Her husband was over-joyed. "How nice!" he said. "Since that's the case, let us invite in Wealth. Let him come in and fill our home with wealth!"

His wife disagreed. "Why don't we invite Success?"
But, their daughter was listening from the corner of the room. She jumped in with her own suggestion. "Wouldn't it be better to invite Love? Our home will then be filled with love!"

The wife agreed. "Then, let us heed our daughter's advice," said the husband to his wife. "Go out and invite Love in to be our guest."

The woman went out and asked the three old men, "Which one of you is Love? Please come in and be our guest." Love got up and started walking toward the house. Then the other two also got up and followed him.

Surprised, the lady asked Wealth and Success, "I only invited in Love, as you directed. Why are you all coming in?"

The old men replied together, "If you had invited only Wealth or Success, the other two of us would have stayed. However, since you invited Love... wherever He goes, we go with him... because wherever there is Love, there is also Wealth and Success!"

Tuesday, October 28, 2008

How to Measure Returns

Azizi Ali, one of our famous local millionaires not only accumulates wealth for himself, but also help others achieve the same by training and imparting his knowledge. I found this topic quite interesting as I get questions or statements from friends and family members who say that market is down, so don't invest! or I'd want to monitor my fund performances on my own (mutual funds, to be exact) so that I know how much returns I'm making..

Special Report: How to Measure Returns
by Azizi Ali

"I made fifty thousand in the stock market in 99!" an acquaintance proudly declare. In fact, it was so loud, he was practically screaming in your ear. Which kind of make you feel inadequate because you only made ten grand. So you quickly change the conversation subject to the mating rituals of extinct Sagittarian Mongolian bisons.

But hold on a second. Though it's true that you made less money than him, it does not necessarily mean that he is one up on you. Because we are only talking of straight figures so far. And that is not how return on investment are calculated.

The correct way of measuring returns is in two ways: in percentage form and on an annual basis.

Return must be expressed on a percentage term

Return expressed in straight ringgit/dollar/yen has little meaning. This is because straight ringgit amount do not reveal the amount of money that had to be invested in order to earn that return.

For example, is RM10,000 a good return? The answer is that it depends on the amount invested. If RM50,000 was invested, then RM10,000 would be an excellent return as it is a 20% return. However, if the original investment was RM500,000, then the return is a measly 2%. If his layout was five million instead, then he would have cried as his return is...0.2%! Pass the tissue paper, please.

Return must be expressed on an annual basis

But the job doesn't end there. Even after expressing the return in percentages, it must also be expressed on an annual basis. This is the universally accepted way of stating a percentage return.

Following the earlier example; if the RM10,000 return from the RM50,000 was realized after just 6 months, then the annual return is 44% (The return is 44% instead of 40% due to the compound effect). And even if the investment was cashed out after that six months, we would still consider the return as 44%.
If on the other hand, the RM10,000 was realized at the end of two years, then the return is only 9.54%. (Again, the 9.54% return instead of 10% is due to the compounding factor).

So now you know that the return of x % in y number of years - often quoted by fund managers - is not the right way of indicating return on investment. A 50% return in five years may look good but that is only 8.44% annual return.

Then we can compare

Once we have the returns expressed in percentage form and on an annual basis, only then we can compare the various returns from different investments. Only then the comparison be fair and sensible. Orange to orange, durian to durian.

Coming back to the beginning example, if the guy made RM50,000 from investing RM500,000, his return on investment is 10%. Not bad. Something to crow about, I suppose.

But since you made the ten grand by investing only RM20,000, your return is a fabulous 50%! Whaddaya know - You are the winner!

Now you can go back talking about sex and dead Sagittarian Mongolian bisons.

Sunday, October 26, 2008

Impact Of Goal Setting

Another inspiring story that was delivered to my mailbox. Though the topic is on Impact of Goal Setting, the example given in on the world's greatest investor,Warren Buffet. I guess it would be useful to all investors out there, especially to those who look up to him as the Investment Guru.

In 1952, there was a research study done on the impact of goal setting on the graduating batch of students at Yale University. When asked how many of them had clearly specified and written down goals, only three percent responded. The remaining ninety-seven percent, despite being highly intelligent and hardworking, had no road map where they would be five to ten years after graduation. Twenty years later in 1972, a follow up study was done on the class of 1952. What they discovered was shocking; the combined income of the three percent who had clear goals was greater than the entire income of the ninety seven percent combined! Was it just a coincidence or does having clear goals really have an impact on a person’s personal and financial success?

One classic example is investor Warren Buffet. Does his ability to come about by chance? Absolutely not. From a very early age young Buffett was obsessed with making money and had a very clear dream of becoming the world’s greatest investor. Born during the depression when his father was close to bankruptcy, Warren learnt about the value of money and the importance of being financially secure at an early age.

Even before his teens, Warren knew that he wanted to be rich. As early as elementary school and later on in high school, he would tell his classmates that he wanted to become a millionaire before the age of 35 (when he turned 35, his net worth exceeded $6 million). It was because of his goal that he constantly thought of ways to make money, while most other kids his age would be spending their parents’ money.

He even memorized a book called ‘ A Thousand Ways to Make $1,000’. At the age of six, he started buying coke bottles at 25-cents per six-pack and selling them at 5-cents a bottle, giving him a 16% gross profit, as he would tell himself. At the age of 13, he got a job delivering newspapers and through innovative marketing and distribution strategies, he served five hundred customers a day. At the age of 11, he took all his savings and started investing in the stock market. His first investment was three shares in a company called ‘City Service’. While most kids his age were reading comic books, Warren spent his time reading company annual reports.

By the age of 14, he started a pinball business and was earning $175 a week, as much as the average 25-year old was earning in 1944. Would he have taken all those actions if he never set a goal to be rich in the first place? Of course not. It was clearly because of his focus of energy and actions that allowed him to become the best in what he does.

Friday, October 24, 2008

A Blog Posted by Singapore 's Youngest Millionaire

I just came across this article in my mail. Went through a very fast googling process looking for its source. Ended up at Looks like this guy is from Singapore and made his 1st million at the age of 26 and currently gives lots of speeches/seminars and has written quite a number of top-selling books. His frugal lifestyle is something that all of us should aim to learn and follow.

By Adam Khoo

Some of you may already know that I travel around the region pretty frequently, having to visit and conduct seminars at my offices in Malaysia, Indonesia, Thailand and Suzhou (China). I am in the airport almost every other week so I get to bump into many people who have attended my seminars or have read my books.

Recently, someone came up to me on a plane to KL and looked rather shocked. He asked, 'How come a millionaire like you is travelling economy?' My reply was, 'That's why I am a millionaire.' He still looked pretty confused. This again confirms that greatest lie ever told about wealth (which I wrote about in my latest book 'Secrets of Self Made Millionaires'). Many people have been brainwashed to think that millionaires have to wear Gucci, Hugo Boss, Rolex, and sit on first class in air travel. This is why so many people never become rich because the moment that earn more money, they think that it is only natural that they spend more, putting them back to square one.

The truth is that most self-made millionaires are frugal and only spend on what
is necessary and of value. That is why they are able to accumulate and multiply their wealth so much faster. Over the last 7 years, I have saved about 80% of my income while today I save only about 60% (because I have my wife, mother in law, 2 maids, 2 kids, etc. to support). Still, it is way above most people who save 10% of their income (if they are lucky). I refuse to buy a first class ticket or to buy a $300 shirt because I think that it is a complete waste of money. However, I happily pay $1,300 to send my 2-year old daughter to Julia Gabriel Speech and Drama without thinking twice.

When I joined the YEO (Young Entrepreneur's Organization) a few years back (YEO is an exclusive club open to those who are under 40 and make over $1m a year in their own business) I discovered that those who were self-made thought like me. Many of them with net worths well over $5m, travelled economy class and some even drove Toyota's and Nissans (not Audis, Mercs, BMWs).

I noticed that it was only those who never had to work hard to build their own wealth (there were also a few ministers' and tycoons' sons in the club) who spent like there was no tomorrow. Somehow, when you did not have to build everything from scratch, you do not really value money. This is precisely the reason why a family's wealth (no matter how much) rarely lasts past the third generation. Thank God my rich dad (oh no! I sound like Kiyosaki) foresaw this terrible possibility and refused to give me a cent to start my business.

Then some people ask me, 'What is the point in making so much money if you don't enjoy it?' The thing is that I don't really find happiness in buying branded clothes, jewellery or sitting first class. Even if buying something makes me happy it is only for a while, it does not last. Material happiness never lasts, it just give you a quick fix. After a while you feel lousy again and have to buy the next thing which you think will make you happy. I always think that if you need material things to make you happy, then you live a pretty sad and unfulfilled life.

Instead, what make ME happy is when I see my children laughing and playing and learning so fast. What makes me happy is when I see by companies and trainers reaching more and more people every year in so many more countries. What makes me really happy is when I read all the emails about how my books and seminars have touched and inspired someone's life. What makes me really happy is reading all your wonderful posts about how this BLOG is inspiring you. This happiness makes me feel really good for a long time, much much more than what a Rolex
would do for me.

I think the point I want to put across is that happiness must come from doing your life's work (be in teaching, building homes, designing, trading, winning tournaments etc.) and the money that comes is only a by-product. If you hate what you are doing and rely on the money you earn to make you happy by buying stuff, then I think that you are living a life of meaningless.

Wednesday, October 22, 2008

Story Of A Little Boy

The other day I came across a very interesting story. It was a story of a little boy. A true story. This little boy picked up an interest in music. For several years, he had been learning to play the cornet. He persisted, putting in hours of practice at home each day, and there came a time, after many painful hours of practice peppered with criticism from his mother, that he was rewarded by being chosen to participate in his school's Armistice Day Ceremony.

Each year on November 11, the entire school went down to the gym for a ceremony honouring the nation's fallen soldiers. In what had become a school tradition, trumpet players stationed at doors on either side of the gym would alternate playing "Taps," one blowing the first dum da dum notes, and the other echoing dum da DUM, and so on.

That year, this boy's cornet skills had advanced enough for him to be given the part of the echo. He woke up the morning of the event, exhilarated at the prospect of performing in front of the entire school. When the big moment came, he was ready.

As the little boy stood in the doorway with his cornet, the first trumpet player sounded, Dum da DUM.

But on the second dum, he hit a wrong note.

"My whole life flashed before my eyes, because I didn't know what to do with the echo. They hadn't prepared me for this. Paralyzed - my big moment" recounted the little boy years later.

Should he copy the other trumpet player's mistake or embarrass him by contradicting what he's played? The little boy was undone. The scene scalded itself permanently into his memory. What he did next he can't remember - had become a blank.

But that little boy learned a valuable lesson that day: It might seem easier to go through life as the echo - but only until the other guy plays a wrong note.
It is a lesson that will serve all of us well. Often, either by choice, circumstances or sheer force of habit, we end up playing the 'echo'. And this was probably the lesson that made him stick to the principle 'Be Greedy When Everyone Panics, and Panic When Everyone Is Greedy'.

That little boy grew up to be the most successful investor of all time and the richest man in the world a few years running. That little boy's name is Warren Buffet.

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Tuesday, October 21, 2008

Can You Continue To Invest In China?

There was a BIG hype before the Beijing Olympics, major financial news indicating that the share prices of China and the Greater China were to soar higher. To a certain extent it was true. When the global economic slump began, China was one of the worst to be hit. In the below table, you can see the market returns of many countries/region.

Market Returns from 2 January 2008 to 30 September 2008.








Hang Seng Mainland Composite


Asia ex-Japan

MSCI Asia ex-Japan






SET Index


Emerging Markets

MSCI Emerging Markets


Hong Kong

Hang Seng Index



Jakarta Composite Index



TWSE Index



Kuala Lumpur Composite Index



DJ Stoxx 600





Asian Tech

Bloomberg Asia Pacific Technology



MSCI World



Nasdaq 100



Nikkei 225



S&P 500


Returns are in RM terms

Source: Fundsupermart

Now, the question is : Can You Continue To Invest In China?

According to Fundsupermart's research, '..should be prepared for short-term volatility. China equity funds are single-market funds which may exhibit greater volatility than regional funds in the short term – we suggest investors place China or Greater China equity funds in the supplementary portion of their portfolio, which usually takes up no more than 20% of an overall portfolio.'

Rick Aristotle Munarriz in his article, 7 Reasons to Remember China at The Motley Fool, mentions that ' long as all seven of these companies keep growing, they will be big market winners in four years.'

'...China has the largest population in the world, and it has had economic growth in the last nine or 10 years of at least 9%, 10% or 11%. If the bubble bursts, maybe the economy grows at 7% a year. That's still greater than other economies in the world...' this should be noted as another strong point why China should be a good place for investment during bad times, as written on's China: 'The Best Place to Invest in the Next Five to 10 Years'

It will happen eventually, the question is when? So, in order to be on the safer side, never put the money that you would be needing in less than 5 years for investment.

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Sunday, October 19, 2008

Which Industries Should You Invest In At Times Of Recession?

Below are the list of some industries that remain healthy, if not doing too well in an unhealthy economic conditions:
  • Pharmaceuticals
  • Healthcare Companies
  • Tax Service Companies
  • Gravediggers
  • Waste Disposal Companies
  • Discount Retailers
  • Sin Industries
Read more about Industries That Thrive On Recession at Investopedia. They've also got tonnes of other articles on investing and finance. A very good place to start off for beginners.

Wednesday, October 15, 2008

5 Most Important Things To Watch Out When Taking Housing Loans

Look out for the lock-in period.
This is the time frame set by the banks to tie you down with them. Usually they won't allow you to swith to other financial organisations within this period. They also would not like you to pay off the debts earlier than scheduled. If you do any of the above, it is possible for them to charge a fee which would be between 5%-10% of the loan amount.

Choose the right package
Though there would be various packages offered, they can be summarised into 3 broad categoried:-
-starting off with a very low interest rate and later have a BLR (base lending rate) + x%
-a fixed interest rate throughout the loan tenure
-initial high interest and gradually lowering the rates, or having a BLR -x% for the main portion of the tenure.

Now the question is, which is the best package? Well, it all depends on you. The type of organisation you are working for or running your own business, are you on a tight budget now and how you foresee your income growth in the future.

See whether the lawyer's fee/MRTA is absorbed by the bank or passed on to the customers.
In an economic situation like this, most banks try to absorb the legal cost involved and give free MRTA (Mortgage Reducing Term Assurance) coverage.

Choose a bank with the best service offer
When applying for loans, try to apply to as many banks at once. In fact, instead of going to different locations, looking for these banks, if there is any expos going on for new homes, you can get most of the banks having a counter there. Or simply give a call to them and get a sales representative to see you. You can then choose the fastest service provider or the one that really satisfies your condition of customer service. If you face problems in the beginning itself, most likely you would have problems too later on.

Get a longer tenure for the loan
Whichever institutions giving you the longest loan period, grab them!
Though it will boil down to having to pay more in terms of interest, our aim would be to pay more than the stipulated amount monthly. Most banks charge lesser interest rates when the duration is longer. And we can make use of this point to our advantage. When paying off 100 or 200 extra every month, the duration of the loan will be reduced automatically and in bad times, you can choose to pay lesser than what you are used to pay every month and you will feel a great relieve for that.

In Malaysia, there are many banks offering home loans that varies in its packaging. I list some of the more popular ones below:
1. Standard Chartered

2. Public Bank Berhad

3. HSBC Bank Malaysia Berhad

4. Hong Leong Bank Berhad

5. AmBank Berhad

6. MaybankBerhad

7. Citibank Berhad

No, I'm not being paid to list the above banks and neither am I biased towards any one of them. It's just through my own experience of getting a home loan. I finally ended up taking a home loan from Public Bank as it met with most of my requirements.

Tuesday, October 14, 2008

What Should You Do With Your Money Now?

The most common questions running on everyone's head now would be:
  • where to stash my cash?
  • is it a good time to invest now?
  • should I sell off my investments (stocks, mutual funds, etc) and keep liquid cash?
So, wanting eagerly to dig out the information from my head for the benefit of mankind (ha ha ha), I started this post. However, as I continued with my research, I found that there were already some very good analysis done on this topic and posted on the net by some very experienced finance guys/gals or just let's call them financial gurus. Cancelling of my earlier idea, I decided to let you all to have a go on their opinion instead.

James B. Stewart has written piece recently on this matter in smartmoney under the title : Crashes, Like Bubbles, Call for a Level Head

I liked what he said: -

"I didn't need to waste much time thinking about what to buy. Everything was beaten down. There didn't seem to be any point in stock-picking. As I've said before, at a time like this what you buy is less important than that you buy something."

" the predominant emotion, which is fear in a panic, greed in a bubble. Psychologists tell us fear is a more powerful emotion than greed."

He's also written another excellent article, For Long-Term Investors, Now Is Time to Buy. This simple title by itself should tell us what we should do now in terms of investments.

We can also make use of one of his valuable tips in investment as I found below:

"....I follow a disciplined system of buying on 10% declines in the Nasdaq, and selling at intervals of 25% gains. These are based on historical averages for corrections (an average 20% decline) and bull markets (an average 50% gain.) The goal is simple: Buy lower and sell higher."

The Silicon Valley Blogger in her latest update has poured out her opinion, even though that is not the main topic of the day:

"...that it would be a total waste of a bear market if we ever miss the chance to dollar cost average even just a teensy bit into it. If we’ve got money to spare, it’s going into our core index funds."

For a more comprehensive read, she has also given ideas on Best Places To Put Your Money When The Stock Market Tanks.

Over a cup of tea with a friend, a question popped out. "If the average person is selling, then who’s buying?" As I was searching for an answer, I stumbled upon a very good article by J.D at getrichslowly. I was quite surprised to find the exact words that we used were actually in his article! Maybe then, it is possible that we were not the only ones discussing about this topic now.

At the end of the day, after listening to the experts, you decide yourself what do you want to do with your money. It is your money after all.

What is Dollar Cost Averaging?

Dollar-cost averaging (DCA) is a wealth-building strategy that involves investing a fixed amount of money at regular intervals over a long period. Now, most of the time, we hear this term being associated with mutual fund investment. Is it only good for that?

Dollar-cost averaging is simply an investing method of a fixed dollar amount at pre-determined intervals.It can be used in stocks investments as well as mutual fund investments or just any other kind of investment. Yes, you can apply it on real estate investment too, if you want. However, the problem would be the amount of cash that you would need to apply this strategy. For example, let's just say you bought a property at 200,000. Can you invest the same amount on a regular or monthly basis? That would be ridiculous!

But it would be an excellent strategy to be used on mutual fund investment or in the share market. The amount of money invested at each interval remains the same over time, but the number of shares purchased varies based on the market value of the shares at the time of a purchase. When the markets are up, you buy fewer shares per dollar invested due to the higher cost per share. But frankly speaking if the market is on the uptrend, it would not be advisable to invest, right? However, usually investors in mutual funds are known as passive investors, therefore they just let their investment grow over the years and probably they don't have the time to monitor their investment as well. When the markets are down, the situation is reversed and you purchase a greater of number of shares per dollar invested. It's a strategic way to invest because you buy more shares when the cost is low, so you get an average cost per share over time, meaning you don't have to invest the time and effort to monitor market movements and strategically time your investments.

It enables even low-wage earners and folks with tight budgets to invest a minimum amount that they are comfortable with on a regular basis.It cultivates investors to get into the habit of saving, and these small amounts can really add up over the course of a lifetime thanks to the power of compounding.

Now, the next common question would be - 'Can't we do lump sum investment for mutual funds or in the stock market?'. To learn the pros and cons of each strategy, there's an excellent research done by the Silicon Valley Blogger on thedigiratilife.

Sunday, October 12, 2008

Cancel your credit card before you die.......... (Hilarious!)

Just received this joke via email. Hope you people out there enjoy this too... the lighter side of finance!

Now some people are really stupid!!!! Be sure and cancel your credit cards before you die. This is so priceless, and so, so easy to see happening, customer service being what it is today.

A lady died this past January, and Citibank billed her for February and March for their annual service charges on her credit card, and added late fees and interest on the monthly charge. The balance had been $0.00 when she died, but now somewhere around $60.00.

A family member placed a call to Citibank. Here is the exchange:

Family Member: 'I am calling to tell you she died back in January.'
Citibank: 'The account was never closed and the late fees and charges still apply.'
Family Member: 'Maybe, you should turn it over to collections.'
Citibank: 'Since it is two months past due, it already has been.'
Family Member: So, what will they do when they find out she is dead?'
Citibank: 'Either report her account to frauds division or report her to the credit bureau, maybe both!'

Family Member: 'Do you think God will be mad at her?'
Citibank: 'Excuse me?'
Family Member: 'Did you just get what I was telling you - the part about her being dead?'
Citibank: 'Sir, you'll have to speak to my supervisor.'

Supervisor gets on the phone:

Family Member: 'I'm calling to tell you, she died back in January with a $0 balance.'
Citibank: 'The account was never closed and late fees and charges still apply.'
Family Member: 'You mean you want to collect from her estate?'
Citibank: (Stammer) 'Are you her lawyer?'
Family Member: 'No, I'm her great nephew.' (Lawyer info was given)
Citibank: 'Could you fax us a certificate of death?'
Family Member: 'Sure.' (Fax number was given)

After they get the fax:

Citibank: 'Our system just isn't setup for death. I don't know what more I can do to help.'
Family Member: 'Well, if you figure it out, great! If not, you could just keep billing her. She won't care.'
Citibank: 'Well, the late fees and charges do still apply.' (What is wrong with these people?!?)
Family Member: 'Would you like her new billing address?'
Citibank: 'That might help...'
Family Member: ' Odessa Memorial Cemetery , Highway 129, Plot Number 69.'
Citibank: 'Sir, that's a cemetery!'
Family Member: 'And what do you do with dead people on your planet???


Thursday, October 9, 2008

10 Top Things To Check For When Buying An Apartment/Condominium

As I just moved into my own apartment, I'd like to share some of my experience as well as the mistakes I made when I bought it. Hope it would be beneficial to others.

One of the main reason people move in to apartments these days is security. So make sure that sufficient security officers are at duty. You can even try to enter the apartment and see how difficult/easy it is to gain access. From there, you can judge on your own the efficiency of the security in that apartment before you decide to purchase your unit.

Piping system
Living in an apartment is a lot more different from living in a house. In a house all repairs have to be taken care by the house owners themselves. However, in an apartment you are responsible for your neighbours too. For example, if your neighbour right below your apartment unit complains of leakage from his ceiling, you have to take action to rectify this problem. If not, he can even sue you! But be careful, as you won't be able to detect leakage in your own walls if the property is painted with a new coat of paint.(as I am facing now!)

Ensure that the property is close to whatever facilities you require such as shops, school, workplace, mother-in-law's house, etc. mmm...maybe you want it to be really far for this last point..:)

If you own a car, make sure you get an allocated parking space. If you need additional parking space,(maybe your spouse owns a car too) check for the charges and whether they are covered or not.If you expect frequent visitors, then you have to consider visitor's parking as well. Some apartments are really facing problems in this area and resort to double parking (as I've faced before especially in the heart of the city) and this makes the area really congested and not an ideal place to live in.

Public transport
Some people depend on public transport very much. For those in that category, make sure you can get your preferred transport easily. And if you have to travel a bit to the nearest train station, consider the amount you have to fork out for that near distance as well as time taken to get there. However, expect lots of noise and pollution in a place where there is good public transport system.

Occupancy rate
Please check with the management office about the occupancy rate. An ideal situation would be occupancy rate of between 80%-90%. Higher occupancy rate means that the value of the property has a fair chance of appreciating in the future. You will also find it easy to rent out your unit in case you decide to do so in the future. (I made a mistake here too.)

Know your neighbours and love them! Make sure your neighbours are the exact kinds that you would enjoy or comfortable living with.If you are in a multi-racial society, ensure it has a well accepted ratio of people from all communities. If you have kids, ensure that it will be a healthy environment for them to grow up.

It is very important to consider the position of the apartment (whether it faces north, south, east, west) as well as the arrangement of the living room, toilet, kitchen and hall in it. As more have started believing and practicing the ancient geomantic sciences such as Feng Shui and Vaastu Shastra, you will find it easier to sell later on if you have adhered to these principals as well.

Lift/Escalator services
Ensure that there are sufficient number of lifts and they are serviced periodically.In case you are looking at an apartment without these services, try to get a unit on a 1st or 2nd floor. Ground floor would be too noisy and climbing up 5 floors daily wouldn't be a comfortable experience!

Age of building
By knowing the age of the property you are going to invest in, you can roughly estimate the repairs that you have to do such as wiring, plumbing, etc. Apart from that, if the property is a lease-hold, you know how long you can continue living in the same place and after some time, if you plan to mortgage the house to take loans, you have a rough idea from now itself the ease/difficulty that you will face.

If you have any experiences you would like to share, I would love to hear from you.

Fast money anyone?

Almost everyone that I know of wants to be rich fast. No patience in waiting to grow their wealth. Well, probably that includes me too, when I was much younger.However, after dabbling with various websites,blogs, magazines, books,classes and seminars, I've managed to slowly crawl out of my shell.

The group that falls mostly in this category are the ones aged between 20-35. At least that's what I find when I talk to my friends of that age group. I figured that while less than 20 would not have worries or plans about their financial future (because most probably they are still depending on their parents for survival), those above 35 must have had their share of life's experiences for them to have a different opinion.

During that age(20-35), as I recall clearly, me and my friends used to sneak into casinos and illegal gambling spots that kept mushrooming in the city to fulfill the needs of high adrenaline rush in youngsters like us. And make money we did!

My personal favourite was the Russian Roulette and Horse Racing (computer animated). We used to do all crazy stuffs, especially when it was pertaining to bring us luck. After a while lady luck seemed to get bored and decided to leave us.

Then, slowly we began to 'graduate' and move on to more serious ventures known to many as 'Get-Rich-Quick-Schemes' or 'High-Yield-Investment-Products'. Those agents/con-men that we met were really convincing enough for us to part with our money. The main reason people are still throwing in their money in these kind of schemes despite reminders and warnings from the authorities is plain greed. People just can't let go of the idea of being rich overnight and are willing to take BIG risk for that.

There are plenty of those schemes out there, both local and foreign ones, but I'm not going to list them here. Some deals are done face-to-face while others make use of the technology where they come up with really professional looking websites and systems to attract their potential 'victims'.

Then as I grew more matured (or so I thought),I started going into the stock market, without the slightest knowledge about the vast financial world out there. The result? Burnt my fingers of course! But it was a worthy experience, since I learnt it at quite a young age, now I can restrain myself from going into the stock market just by relying on 'tips' from friends.

So, now whenever I advise people to invest in a more reliable and trusted source (such as mutual funds,etc.) and they don't seem to agree or understand, I just remain silent. After all, I've been in their shoes before!