Some Personal Thoughts of Saving

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When we talk about the word ‘saving’, everyone is having their own interpretation. Some of them consider ‘saving’ as occasionally depositing certain amount of money into the bank, some people interpret it as reducing the extra expenses when there is a need and get prepared for the luxury gadgets in a few months time. Yes, that’s what the saving means! However, if you are the person who falls in the above categories, your saving amount will be limited and I believe nowadays, most of the youngsters came from the above categories.

I have the sense of concern in business, particularly in investment, but low-risk investment. Throughout the few months of holiday, apart from working for freelance part-time job, I have been spending so much of time to understand about financial planning. A good financial planning will bring you a comfortable lifestyle in the future, with the theory from the usual form of speaking ‘money earns money’. If someone is working with the salary higher than you, but without doing a proper financial planning, I’m sure that you will be having an equal or better financial status with the person in the future if you did the financial planning during your young age.

There are plenty of investment schemes in the market nowadays. There are some investments that produce regular income flow without capital gain, eg. Fixed Deposit. There are some that produces no regular income flow but capital gain, eg.Commodities. Bear in mind that, saving in the bank for long term is not called ‘saving’, but wasting your money, must well u donate your money for charity now. Why I said so? Spent some time to google for the term ‘inflation’. I’m sure that you will get what I mean.



Some of the reasons that people resist to involve in long-term saving/investment:
1) Not the time yet? So, when is the right timing? 1-year later, 5-year later or 10 years later? Saving during young age is having greater advantages compared to older age as the person is having higher risk-tolerance. Believe it or not? Age plays an important role. Take an example, Mr.A starts to save RM100/month when he was 20 years old. After 20 years, he is having the total saving amount of RM52,638 (says 7% interest). Now, lets see another person, called Mr.B, who started to save money only when he was 30, but with the amount doubled compared to Mr.A, says RM200/month. When both of them are 40-years, Mr.B is having only RM35,481. Why the difference is so huge? Try to figure out by your own.

2) No money to save? It doesn’t care how much you save, but how much you save determine how much you get. Saving does not require you to allocate all of your money and keep for your future, but less than 10% of the amount that you are earning. Is that hard?

Too much of them to mention…. I’ve to stop now. Please share the info with friends if you found them useful & alert me with you don't agree with me.

Stay tune for the next post. Have a nice day^^