My investment journey did not start with property. My first property happened only when I was 26 years old. I know, so late…right? If only I started earlier, then perhaps I would have had much higher successes today. However, before property started, I have started to invest into unit trust and stocks when I have just started working. The extra money, I put them into the unit trust and the stock market.
I was speaking to a COO of a production house some years ago and she told me that her kids love to save their money. In fact their financial management seems to be better than hers! I was like, wow… Anyway, with regards to savings, it’s super important that we turn those savings into investments yeah. Keep enough savings in Fixed Deposit for 6 months (minimum) just in case we are in between jobs but anything extra, it has to be invested. Investment does not start with property by the way.
#1 – Why must we invest? There’s inflation…
Inflation rate has been averaging around 3.4% for Malaysia if we look at a very long period of time. It meant that if we had put money in the bank and it gives us 3.5% in returns, we are technically gaining just 0.1% in wealth increase every year. Returns minus Inflation. Oh dear… Image as below:
#2 – What could I start with?
So, what if I have just RM500 savings per month in the beginning, what could I do with those money? Actually, quite a lot of stuffs. We could invest it with a Roboadvisor (I did. more details here) We could also put a comment in our FB page. ‘I want to buy unit trust. Anyone of you are selling unit trust? Please pm me’ Alternatively, it could also be opening a CDS account to start buying shares (click here to learn more) ! Okay, when it comes to shares, perhaps slightly more reading is needed but investing into good shares are just as safe as unit trust actually. Potentially the share prices could rise faster too.
#3 – Be calculative when it comes to money
Then, we come to the question of, should it not be property? Let me be very calculative. RM500 cannot buy us any property. However, RM500 per month invested on a continuous basis (including returns) meant that meant that 5 years later, it may just be enough for a new property downpayment. You still prefer to invest in something ‘property based?’ You have a choice. Please read this from a good friend’s blog. Complete Guide to REITs. Real Estate Investment Trusts (REITS) may just be that great choice.
#4 – What about me then?
Do you know that Charles Tan who writes in kopiandproperty.com daily and who loves property investment is also into shares / stocks? He has also been continuing his investments into a few unit trust brands? Yeah, he wrote this article too: Are we earning, saving, investing and preserving? Haha. Nope he does not run courses on property investment because it would be super boring. He advocates buying a property only after one has saved enough downpayment. Hard to get hundreds of thousands of cashback suddenly.
#5 – Money and Knowledge are needed
By the way, there are two major stumbling blocks to property investments yeah. Money and Knowledge. We need to save enough for downpayment and we need to read a lot more before we buy. Simply listening to our best friend does not work yeah. It may just land us into the world of debts and it’s super tough to come out of a bad property investment. Happy learning and investing. Yes, in this order, learn first, invest later. Please do continue to read kopiandproperty.com It helps a little.
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