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36. Finances 101: 10 Perspectives - From my point of view. 10. Five Perspectives: Financial Goals. G

You might be thinking, where's the investing part in all this?


The reason for being put lower on my list is because I am kind of risk averse, so I'll usually do all the basic stuff first before going into investing.

These are just a few ways:

1. Using your insurance products.

As you will know, there are many insurance products today that have elements of investing within them. So while you are taking life insurance with medical cards and having savings and protection elements within, there are a whole list of products that are investment linked. If you do not have much extra cash to spare, you can make the premiums you pay include investment linked products. That means that your insurance products are now multi pronged. On top of protection and savings and medical card, it also functions as a forced investment as you have to pay your premiums all the time....

2. Use your EPF for getting a property

If your EPF account has sufficient funds, you can actually withdraw a certain portion of your EPF to use as a deposit for your property purchase, subject to conditions of course. This means that you need not use your own cash flow but actually use your EPF to fund your down payment. Then you can actually fund the rest of your property purchase by renting out the property. Note that this should be your additional property that you are using for investing, not for own stay. This presumes you already have a first property you are living in or are staying with your family in another property. This is purely an investment.

3. Use your EPF for investing in Unit Trust

From another account in your EPF, you are now allowed to withdraw a certain portion for investment into Mutual Funds or Unit Trusts. This means you need to look for products that can actually earn you more than what the EPF can earn for you. If you do that, then you are making your EPF money work harder for you.

4. Employee Share Option Schemes (ESOS)

If you can, as you are looking for employment, check if one of the benefits you can get is a share scheme for employees. This is good if your employee is doing well and you can get rewarded / it is a staff benefit via receipt of share options. If this is so, purchase the shares as often and as much as you are allowed to. Of course, agree to receive them if they are a part of your remuneration or bonus for hard work. This will be a separate portfolio of shares that constitute an investment too.

Just a reminder: If the shares you have / bought are from a different / foreign stock exchange from your local one, please note that liquidity may be a problem. Get information and find out what is the best and fastest way you can liquidate those shares when required. Seemingly not important but can be a life saver when you are short of funds and a big chunk of your assets are stuck in a foreign stock exchange.

5. After doing all that, and the other stuff in my previous posts, and you still have extra funds for investment, you are quite free to play around with the extra. These are some things you can do:

  • Invest in yourself: Take a course to better yourself

  • Invest in a side idea that may end up being an income generator for yourself. Some people start a small business. Others write, while others do videos etc.

  • Invest in your children's education:- either today by sending them for extra special classes, or in the future by putting the funds in a trust for your children.

  • Go invest in your own happiness: go for a trip, or buy something you really want

  • Invest in others: Give to charity, give to NGOs which you believe in, etc

What do you do with your extra funds?

Share here.

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