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7 tips on Effective Debt Management

This is what AKPK says about Debt Management. “Regain control of your life and your debts.” If you are already at the AKPK stage, please continue and do follow their advice closely. However, if you are only starting to feel as if money is not enough and occasionally you have to stop going out at the final week of every month, then please read on to the below 7 things you could think about managing your debts. Oh yeah, debt-free is not financial freedom. (read here for an earlier article). However, financial freedom cannot be achieved if you could not even repay your debts yeah. Let’s look at the 7 strategies.

#1 – SAVE, SAVE and SAVE. The first debt-management strategy is definitely NOT to get into debts in the first place. If we are able to save money every month, that is a sign that we are not taking up debts. A very good sign indeed. Thus, a measurement of success would be how much could we save every month. Could we save more as we earn more? Could we save more every other month?

#2 – DO NOT apply for many credit cards. You know, every month when we have just received our salary, we feel rich. When we feel rich, we spend. It is the same with credit cards. When we have one credit card, we spend with one credit card. When we have three, we spend with three. Imagine what happens when we have more than three.

Our salary could be RM5,000 per month. The credit limit may be RM10,000 per month. Spending all this limit meant you need many months to finish paying it back. 3 cards meant we have credit limits of up to RM30,000 per month. This is why as soon as you start spending on three cards, there’s no way home…

#3 – GET OUT of your debt(s). Whether it’s PTPTN which is a responsibility to the future students who need it or credit card debts. By the way, home loan is not considered part of this because even if we have no home loan, we will need to pay rental anyway. STOP paying the minimum amount. Start to reduce that outstanding amount every month by NOT using the card and keep paying for it until you have finished your balance. Simple but hard to do. Well, it’s either this or bankruptcy in the future. (read here to understand what is bankruptcy)

#4 – Do we REALLY NEED it? New smartphone launched. Our colleagues have it. It looks so awesome. Surely everyone will be envious if we get one. Three questions. Is our current one doing just fine? Continue using it. Is our current one giving problems but we can live with it? Continue using it. Is our current one really nearing its end? Then, find out if there are cheaper models which fits all our minimum requirement except the ‘making people jealous’ part. Buy that cheaper model instead.

#5 – Think Sense. Not cents alone. We need a new set of sofa. We believe a RM10,000 set can last longer than a RM3,500 set. We assume you are right and that the RM3,500 set could only last 3 years. That’s RM3,500 divided by 3 years which is RM1,167 per year. We would need to use that RM10,000 sofa for 8.6 years (RM10,000 / RM1167) for it to be give the same value per use.

Supplementary question. Trends continue to change, even colours, why do we want to use the SAME sofa for 9 years? What if we move home (upgrade), we want to use back that old sofa for the new home and making the new home looking like an old home? Erm… We did not yet calculate the extra investments we could do with RM6,500 over 8.6 years… Chances are this could have been doubled to RM13,000 at the end of 9 years.

#6 – INVEST lah. From a life expectancy of 50s a very long time ago to 60s during the 70s and now towards 80 in 2020, I hope all of us realise that we are living longer and living longer means we need more money. Saving could have been enough then. Imagine working from 20 to 50 years old and using 30 years to save just so that the 30 year savings could last us 10 years. Retire 55, life expectancy 65.

Now… today. 30 years savings remain the same. We work from 25 to 55. (tertiary education, mostly) We retire at 55, same. However, we live to 80… That’s 25 years after retirement. Anyone here could save enough money in the first 30 years to to be sufficient for the next 25 years? Including the inflation which actually continued to eat away our savings? Well, if somehow we could do it, then just do it yeah. Skip #6. 🙂

#7 – Keep ourselves updated. It could be personal finance sites such as If we could track our expenses like how she does it, we are definitely on the right track. Or another of my favourite personal finance written in a story format is Both are ladies. Oops… makes us wonder why. Haha. Plus, you can also read and share with all your friends. LIKE and get updated daily.

These days, resources are aplenty. It depends on whether we would like to learn or not. There’s #8 as well which is to find new income streams but that’s another story another time. Oh yeah, blogging could earn us millions too. (Earlier article here)

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Next suggested article: Is property an asset or liability? How about compulsory?

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Charles Tan The Founder The Writer Kopiandproperty
Charles Tan

Charles is Founder of He writes from his investment experience for the the past 20 years in investments including property, stock, unit trust and more as well as readings and conversations with many property gurus in the industry. is an independent property blog which is not affiliated to any media company, property developer or even real estate agencies.


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