My definition of investing for the working professionals? It’s small, usually and it’s monthly too. It’s long-term. It’s also very hard in the beginning because we are so used to spending everything we earn every month in every way we could! We withdraw one whole stack of RM50 and put it into our wallet. Chances are, everything we see becomes attractive to buy / own. We suddenly remember that advertisement about how a guy could attract that lady after he has used a newly launched perfume which happened to be endorsed by a film star we love. Never mind the price tag of RM299 per 50gm. We have one huge stack of RM50s!
Imagine what happens after buying too many wants? We may only have the last few pieces of RM50 in the wallet and guess what, now those few pieces could last us for weeks until salary day. Funny but true. What has happened has demonstrated why it’s a must to invest our money and well, forget about spending it! Make it a habit by making it continuous. I did this for unit-trust perhaps 15 years ago. Today, I have enough in two famous unit trust companies to get those weekly updates, a dedicated account manager and even getting invited to some events for free. (plus free buffets too) Then, I met someone who explained to me about Stashaway. 5 important facts about StashAway for reference.
#1 – StashAway was the first rob-advisory firm to attain full capital market services license from the Monetary Authority of Singapore. (Yes, that MAS… equivalent to our Bank Negara Malaysia)
#2 – StashAway has been operating in Malaysia since November 2018. It got its license from Malaysian Securities Commission’s digital investment management framework.
#3 – StashAway has a proprietary risk-focused investment framework called ERAA. ERAA basically factors in macro-economic data to make asset allocation decisions through various economic cycles.
#4 – StashAway’s management fees are significantly lower than those of traditional financial institutions. The charges are on a pro-rata basis, thus more of the investors’ funds can be invested. There are no entry fees and minimum balance requirements for customers to start investing with StashAway. Also, customers can purchase a minimum of 0.0001 units of any given asset and can own a highly diversified portfolio for as little as USD 10.
#5 – Founder of StashAway has these advice for everyone. Taken from his interview by KrAsia.
Albert Einstein once said, “Compound interest is the eighth wonder of the world. He who understands it earns it. He who does not pays it.”
This has become my favorite quote when it comes to investing. The power of compounding begins with having a long-term investment plan, and it should help you in three ways: set targets on how much to save, set risks compatible with your goals and tolerance, and set a clear schedule for how often you will invest your savings.
To close, I would also flag that it is important to be aware of the behavioral pitfalls in investing: Don’t borrow money to invest. Ignore the media. Control your FOMO (fear of missing out). Avoid the FOF (fight or flight).
Perhaps this is the time to take that first step? Read, understand and decide. Stop waiting for the best time. It’s time we understand that starting when we are ready is the best time, before we spend it all away anyway. Perhaps it’s now the time to start our investment journey? RM100 a month perhaps? 10 years later, enjoy the discovery of what investment returns really is. Happy evaluating and investing. Here’s that link again. Happy building up future wealth through the power of compounding.
<Featured Image is courtesy of Stock Photos from Olivier Le Moal >
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