Friday Frolics - What's Your Money Type?

Money, money, money, always funny, in a rich man's world.

I know, talking about money is kinda tacky but let's talk about it anyway, but more in an investment/financial sort of way. This week's quiz can tell you the Money Type you are. Take the quiz to find out more about yourself.

Happy Friday, everyone!

You Are a Planner

You are a master when it comes to finances. You are big on making your money work for you. You feel comfortable making big financial decisions for the future. You love to crunch numbers. Spending money in the here and now is not as easy for you. You need to see the big picture of every decision. You will be fine in the long run, so make present day spending part of your plan. You can buy things without ruining your future.

What's Your Money Type?

100's of Fun, Free Quizzes and 3 Stupid Ones

Last week's quiz: What Do You Need Most?

How Credit Cards Can Be Used for Financial Independence

Credit cards can be used as a tool for financial independence if used properly. However, if used improperly, a credit card can lead to financial burden especially if the credit card debt is not settled on time, so it’s good to pick the best credit card based on your ability to pay your obligations.

Having financial independence means not having to worry about the ability to pay bills or having the means to pay for new experiences. One of the first steps to attaining financial independence is realizing that the luxury of a large income does not always mean that you will be financially independent. Indeed, you could take home a huge pay check every month but if your spending exceeds your pay check, you’re not financially independent. In fact, you’re already in debt if that’s the case. A credit card will not do you any good in this situation then, and you need to find a way to cut your expenses or earn more income. You just learned the lesson of the maxim “live within your means” the hard way.

But if you earn enough money from your job and your expenses are well below your income, then you might want to consider diversifying your source of income. Yes, your job is one source of income but that’s just one of them, and there’s always the risk of losing that job or being disabled and that doesn’t make you financially independent.

If you have extra funds then you could consider investing that in the stock market or in starting your own business. This is one situation where having a credit card could come in handy. Having a credit card is one of your options for funding your own business. Many suppliers accept credit cards so you could use your card to pay the supplies that your new business needs. It can also help you take care of some of the costs related to starting a business like getting the permits for the business and some of the equipment that you’ll need for operating your venture.

We’ve already mentioned that being wealthy means having more income than expenses. How could a credit card cut expenses? Well, if you plan to get a house in the future or another big ticket item like a car for example, you could save a lot if you have a good credit history. This shows your lender that you have a good record of paying your debts so that they could give you a lower interest rate on your loan. Having a credit card helps you build a credit history so your task is to diligently pay for your credit card bills every month in order to build a good credit history. You also get to save on penalties if you pay your credit card bills on time so that’s another expense that you don’t have to worry about.

There are other ways to achieve financial independence but the key is to having more income than expenses. A credit card can be used to increase income (by helping fund your startup) or for avoiding expenses (like higher loan interests by helping you build a credit history that will unlock lower interest rates for big ticket items like home loans and car loans).

About the author:
This is a guest blog contribution by Michael Vincent in behalf of Compare Hero, Malaysia’s leading credit card comparison website. Compare a broad range of financial products – from credit cards to broadband plans for free, right in your browser.

Banks to charge 50 sen to process a cheque from April 2014

Read on The Star today that come April 1 next year, banks will impose a cheque processing fee of 50 sen on the issuer of the cheque to promote greater efficiency says Bank Negara. This fee would be in addition to the existing stamp duty of 15 sen per cheque leaf.

And effective May 2, 2013, the fee for Interbank GIRO or IBG transactions done online via internet banking and mobile banking, would be at 10 sen.

Read more here: The Star..BNM: Banks to charge 50 sen to process a cheque from April 2014

Times they are a-changing..

Malaysian stock market - opportunity to buy

Do you invest in the stock market? Could this be an opportunity to pick up more stocks?

From The Star:

With the FBM KLCI having dropped by close to 50 points over the last two days, some analysts are seeing a buy opportunity emerge, as prices of blue chips and certain stocks in the oil and gas, property and consumer sectors retrace to attractive levels.

Analysts said that the drop in the last two days was driven mostly by sentiment, rather than real fundamental concerns.

On Monday, the FBM KLCI fell 2.4% or 40.81 points on a volume of 1.83 billion shares valued at RM2.6bil.

This was the single largest daily loss since October 2011.

The Best Credit Card?

Is there such a thing as "the best credit card"?

I think not because there is no one single credit card that has everything a prospective cardholder is looking for in a credit card. Some credit cards offer rebate for petrol, some for shopping, others enable cardholder to accumulate points in exchange for products, yet some give discounts for movie tickets and the list of features go on.

If you are in the market for your first credit card or are still wondering about the "best" credit card or whether you have the credit card that meets your needs, or whether you are taking full advantage of the features of your credit card(s), here's a thread from the Lowyat forum that has some good information on Credit Cards. Posters on the thread offer some good tips and insights on the various credit cards and debit cards available in Malaysia.

In this day and age, owning a credit card is no longer a luxury. It is now more of a necessity in the way we conduct our day-to-day living. You wouldn't want to be carrying thousands of Ringgit to a travel agency to buy an air-ticket to London, for instance.

One wise poster on the Lowyat forum offers this list of Pros and Cons of having a credit card:

He/She said:

many people still don't understand benefits of credit card if used in the correct manner.

Pros
a) Bang for your buck - promotions/Discounts specific to issuing bank and also specific to Mastercard/Visa itself

b) Loyalty programs - earn points or rebates

c) Convenience & Safety - Don't need to carry cash around

d) Money management - you can automatically analyze where your money is going as everything is statemented.

e) Leverage on no interests period - which facility borrows you money without any interest for a month? Technically you can leverage on that cash to earn interest in a saving account first or for other investments

f) Fraud protection - For suspected fraud unauthorized transactions or even goods not received related claims, you can raise a dispute without having to pay first. Furthermore the bank is in the power to recall back the payment from the merchant, so it's much easier to "get" your money back instead of giving the merchant hard cold cash in the first place.

Cons
a) causes those with bad money management to overspend

b) Bad forex rates if swiping overseas (Foreign currency to US$ to Local currency billed to you)

And someone else offered:

you miss one important point, INSURANCE on the item you bought.


More info...

One poster said:

I use:

HSBC Visa-shopping discounts/rebates/special promotions

Alliance Visa-Local bank easier to get 0% installment plans with longer period. Eg. got 18 months installment instead of 12 months if use HSBC

CIMB Master-shopping discounts/rebates/special promotions

Must be good at handling finances, I pay promptly every month, credit card interest can kill ur finances if not managed properly.


Another says:

I have used many credit cards over the years.

Here is my experiences.

HSBC Gold credit cards: Very good in term of Travelling Overseas. Cheaper Forex exchange. Many good promotions on discounts. Especially Armani Exchange outlet.. 15% discount. hehe

Citibank Credit Cards:

Gold: Very good. with 30 minutes you charge oversea, they will call you.

Platinum: Very good. with 30 minutes you charge oversea, they will call you. Access to Premium Lounge in KLIA, LCCT for free. Extra benefits. Free stay in YTL hotels. especially for PremierMiles (Platinum Class 1 Credit Credit Card)

Standard Chartered Credit Cards: Very limited and not good points and promotion.

CIMB Credit Cards:

** Free for life platinum:

Visa : Transfer Points very good. Many good promotions on discounts.

Petronas Mastercard: 5% on Petronas. 0.5% for others retails.


RHB Platinum:

Very bad. Difficult to terminate. Lots of hassle.


** If you manage your financial properly, CC is the way to go.. Use 20 days free loan. Pay full every month.



Yet another:

i vote for CItibank Cash Back Platinum
5% on all petrol
2% on telecommunication
and etc


And another:

Think OCBC titanium and Maybank 2 Amex are superior, although the max cashback is 50 per month.

OCBC has 5% on:
1. petrol
2. groceries
3. dining
4. bills

Maybank 2 Amex has 5% on everything on weekends and 5X points and comes up to around 7.5% total discounts.

OCBC doesn't require you to reach blocks of RM50 before they credit you with the cash back, unlike Citibank. Not sure about Maybank.


Another:

I have 2 cards. The main one I am using is Citibank Air Asia. They have promotions on flights every week, and I have priority booking. Which is good for my company staff who wants to book tickets earlier.

Furthermore there is TGV promotion - weekdays each ticket is only RM 10 (ended already sad.gif) and weekend it's buy 1 free 1. biggrin.gif

The other card... HLBB. It's a spare card (just sign up so I can get free items), but now I use the card for online purchases (Paypal).

Lastly..
DEFINATELY AMERICAN EXPRESS PLATINIUM CHARGE CARD, been using for years now.
allow me enter premier lounge whenever i travel, hongkong, usa, tokyo, korea, singapore everywhere. worth every dollar..
although their annual fees is nasty but worth it. can have 5 supplement and all my family member can enter premier lounge and buying business class ticket cathay next one free..buy one free one.


Should you wish to check out more info, visit Lowyat forum..


Nowadays, banks have converted bankcards to also act as debit cards. It may be good to note that should your bankcard go missing (or due to fraud), all you have in your bank account (your savings, monthly salary, etc.,) may be lost/withdrawn. On the other hand, a standalone debit card has the advantage of you losing just the amount you have moved to your debit card account, not your entire savings sum. Does that make sense?

In the case of credit card, in the event of a fraud and you have reported it, you may not need to pay anything.

A suggestion on the forum:
The advantage of having debit card is you can leave it with no credit in it. When need to purchase something, only use your online banking to transfer the exact amount of money to it, then only use the debit card to buy. That is the safest online purchase you can do with a debit card.


My personal take is, whatever credit card you opt for, the key is to be able to manage your finances/expenditure. Not spending unnecessarily and spending within ones means is a good practice.

Are there Fake gold bars in Malaysia?

One has to be careful these days with the number of counterfeit products out there in the market. Fake eggs, fake milk powder, among others, and now even fake gold bars. Last month, fake gold bars were discovered in Manhattan, New York, and it has been reported that they have even made their way to England.

A customer in New York bought some gold bars and heard that counterfeit gold bars have been going around so he drilled into several only to find tungsten in them. The procedure was so professionally done that it is believed that an international ring could be involved.

Here, a 10-ounce gold bar costing nearly $18,000 turned out to be a counterfeit valued at just $3,600. It's filled with tungsten which weighs nearly the same as gold but costs just over a dollar an ounce.

From Yahoo..

"I really got sick. It's a big amount of money and I could not believe that somebody was so professional and clever, it's perfect," Fadl, the customer said.

Here's why even the reputable merchant got fooled, as explained by Fox:

What makes it so devious is a real gold bar is purchased with the serial numbers and papers, then it is hollowed out, the gold is sold, the tungsten is put in, then the bar is closed up. That is a sophisticated operation.

The sophisticated operation may be global in scope: Gold bars filled with tungsten showed up in England earlier this year. The Secret Service is investigating the counterfeits in New York.

So the next time you go to pick up some gold bars, you may want to bring along your drill.


Makes you wonder whether these fake gold bars have come to Malaysian shores, doesn't it?


Image source: Video grab from Yahoo!

Friday Frolics - What does your wallet say about you?

One of the items I recently redeemed from the reward redemption catalogue is a wallet. We all have our preferences for choice of wallets. For example, I would go for a wallet or a purse with ample space for dollar notes - wide enough that you don't have to struggle to put in the notes and high enough so the notes don't show. A compartment for loose change is also a consideration when choosing a wallet.

What about you? What do you look for when choosing a wallet?

This week's Friday Frolics personality quiz is about Wallets. Take the quiz to find out something you might not know about yourself.

Happy Friday, everyone!

Your Money Personality is Reasonable

You are likely very financially savvy. You probably track your purchases down to the penny. Even if you have money problems, you try to avoid letting them stress you out. You try to stay on top of your finances. You are a careful and reasonable person. You think clearly before you make a decision. You are the type of person who likes to clean up often and get rid of dead weight. You live a streamlined life.

What Does Your Wallet Say About You?

Friday Frolics: We're Not Shrinks, But We Play Them On the Internet

Bank Negara issues new notes

New Malaysian currency notes go into circulation today.

The new notes comprise RM100, RM20, RM10, RM5 and RM1 denominations, in bright colours and motifs depicting Malaysia's cultural heritage and nature.

The RM20 note makes a comeback in this series, while a new polymer substrate is used for the RM5 and RM1 banknotes.

Among the enhanced security features on the new notes are a shadow image, clear window, watermark portrait with pixel and highlighted numerals, colour shifting security thread, micro lens thread, perfect see-through register and coloured glossy patch.

A tactile identification feature has also been included to aid the visually-impaired to identify denominations.

What do you think of the new colours?


Source: The Star

Investing for Retirement

Inflation being what it is, the amount of money we are saving for retirement may not be sufficient to sustain our daily living when the time comes. Investing money wisely to protect the purchasing power is no longer an option but a necessity.

With bank rates at what they are, a diversified investment portfolio that includes gold investment and annuity rates fixed income accounts are two better options for retirement. From what I see, rates offered on annuity accounts are twice as good as rates offered by banks and there are many different types of income annuities, one to suit every need. Investing in gold is another sure way to combat the negative forces of inflation.

Go green - Opt for Electronic payments

When it comes to going green to help save the environment, there are many ways we can go about it. If you bring your own shopping bag shopping, that is one way you are helping the environment.

Recycling and reusing stuff are other ways. There are lots of things we can recycle and/or reuse or avoid using so that less goes into landfills which takes years to biodegrade or worse, never will.

Technology is helping in the right direction. By making electronic payments instead of writing out a cheque, for instance, you help save trees. Electronic payments are not only convenient, they also prevent you from exposing personal details of yourself, including your name, bank account number, signature, all of which a cheque carries. Bottomline, electronic payments are safe, smart and environmentally-friendly!

New Series of Malaysian Banknotes and Coins

The new Malaysian coins are now in circulation. Was elated (I'm simple like that) when I received at a checkout counter a 10-cent new coin yesterday. No surprise actually because I've seen the whole set of the new coins.

In fact, I own a mint set of the new coins as well as a full set of the new notes of the new series of Malaysian banknotes.

According to Bank Negara Malaysia, the exercise of issuing new banknotes and coins is undertaken periodically every twelve years. The theme of the design of the new currency series includes features that are distinctively Malaysia. It also has enhanced security elements in line with the latest advancements in technology for currency notes.

The new fourth series design of banknotes feature in the denomination of RM1, RM5, RM10, RM20 and RM100. The current design of the RM50 banknote already in circulation since December 2007 to commemorate Malaysia’s 50th Anniversary of Independence will continue to remain in circulation. The new design coins are the third in the series for the denominations of 5 sen, 10 sen, 20 sen and 50 sen. This new series of banknotes and coins will co-circulate with the existing series until the latter are gradually withdrawn from circulation.



The Star today highlighted problems encountered with the new coins at parking autopay machines. I remember we used to have this problem when the one ringgit coin was introduced.


Source: Bank Negara Malaysia


Related articles:
- How to go about Identifying Counterfeit Banknote
- Bank Negara issues new notes

Nelson Mandela's image on South Africa bank notes

A milestone for South Africa. A new item of interest for numismatists.

Nelson Mandela's face will feature on all South Africa's bank notes to honour the former president's role in fighting apartheid - a befitting tribute to a man who became a symbol of this country's struggle for freedom, human rights and democracy, President Jacob Zuma said on Saturday.

The new notes will be in circulation by the end of the year. Nelson Mandela became South Africa's first democratically-elected president in 1994.

According to reports, the frail 93-year-old has not been seen in public since the closing ceremony of the Soccer World Cup in Johannesburg in July 2010.

Source: The Star.. South African bank notes to bear Mandela's image

Curbing illegal outflow of funds from Malaysia

The Star in an article today reported that US-based watchdog group Global Financial Integrity in its annual report said Malaysia lost RM150bil in illegal outflow of cash in 2009.

The article goes on to say that It was the fourth highest among developing nations, the report said, adding that Malaysia lost US$338bil (RM1.08tril) between 2000 and 2010.

These figures are mind-boggling considering that Malaysia is a small country and a Third World country at that.

High-tech scanners will be installed at all entry and exit points in the country to curb the illegal outflow of money. These scanners are capable of detecting banknotes in luggage.

Last December, Prime Minister Datuk Seri Najib Tun Razak announced the setting up of a special task force comprising the Malaysian Anti-Corruption Commission, the Attorney General's Chambers, the Inland Revenue Board, Bank Negara and the Customs Department to check the illegal flight of funds.

Sigh.. I reserve my comment..


Source: The Star..Scan for cash

If your Priority is a Reward Credit Card

Interesting email received yesterday. I quote:

"MEN are all the same - no matter what species!"

"AND WOMEN’S REACTION IS THE SAME; NO MATTER WHAT SPECIES THE MAN IS… YOU CAN SEE HER EXCITEMENT. HEE! HEE! HEE! HEE!"

Does it mean that everything is created equal? Of course not! A colleague was talking about how unattractive the card redemption gifts are from her credit card issuer. I tend to agree that some card issuers provide better options. The moral of the story is before you apply for a credit card, it would be to your advantage to do a good filter so that you end up with the best Mastercard or Visa reward card if your priority is rewards redemption.

A tax-deductible move - buying a PC, Laptop or Tablet

What is the cheapest way to get connected when thousands of miles apart? Via the Internet, of course! A colleague just bought a laptop for her mom because her new job requires her to travel often overseas.

Not sure which brand of laptop she bought but I know that after looking through the latest laptops at several IT centers around town, she picked one that's of medium price. Surprisingly, laptops are very affordable these days. In this world of connectivity, every household could do with one unit at home. Besides, as a taxpayer, it's tax-deductible.

Insurance plan that pays immediate annuities

Not sure if this type of insurance is available here in Malaysia but over in the U.S., there is such an insurance plan called single premium immediate annuities or simply "immediate annuities."

What this means is that this insurance product requires only a single payment and after that the insurance company pays you a pension for the rest of your life.

Single-premium immediate annuities are most useful for individuals or couples who are already at retirement age. A retiree can use his/her savings to purchase an immediate annuity, which will ensure steady income for his/her entire retirement, no matter how long he/she lives.

Best credit card deals from Credit Card Applications

It is easy to apply for a credit card in the US. Unlike here, one can apply for a credit card online. This site, Credit Card Applications, has a very wide selection of best credit card deals, one that will suit any credit need.

To help the applicant narrow down the search, you can indicate the user you are whether you are a general consumer, a small business owner (yes, they do have business credit cards), whether you are a student or one with a credit challenge. You can further fine-tune your search by checking off the kind of features and benefits you are looking for. For example, you may want a card that gives you frequent flyer miles or cash back or even annual fee waiver. You can just check off your requirement and a list of credit cards will be located for your consideration. Below is what I mean.

I think you can find the best credit cards here. Get a Citibank credit card or a Capital One or any one from reputable card issuers here on the site. These are the cards and companies that come highly recommended by top businesses and credit review organizations.

This is The Seventh Lunar Month

Bad news sells (newspapers). Indeed. Some say to stay away from reading the papers. But then again, how else are we to get news if we stay away from papers and the media. These are the places we get news from. Unfortunately, there is more bad news than good news these days. These are just a couple of the happenings around the world today.

1. London burns. I have a couple of girlfriends who are in England as we speak. I hope the city they are in is not affected by this rioting violence happening in various parts of the country. This chaos does not augur well for a country gearing up for the 2012 Summer Olympics less than a year away.

2. The share markets all over are going south, first in the US with Stocks Suffering Sharpest Drop Since 2008 and the trend spreading to Asia, including Malaysia. Last time I checked at 12:30PM, the FBMKLCI closed at 1461.21 (-35.78). Is a recession in the offing? May be a good time (as any) to further tighten your belts or if you have cash to spare pick up some good stocks (and gold) which has hit a record high?

These are just two examples of bad (understatement) news around and affecting most if not all of us. It's tiring to talk about negative events. Things, bad things, happen this time of the year, the infamous seventh month of the lunar calendar. Gosh, do I sound superstitious or what! No, I'm actually not superstitious, maybe a little, but being of Chinese descent and growing up in a Buddhist/Taoist environment, Chinese family traditions and customs are part of my life.

Anyway, there is this prediction of the seventh lunar month that I read and the events happening right now around the world seem to ring true. According to the reading, this seventh month is set to see more severe negative energy in the world, much more severe than that of previous seventh lunar months. There is prediction of frequent or worse natural disasters, diseases, violence and freak incidents.

On the personal front, this being the month of the Hungry Ghost Festival, best to avoid dark and secluded places and places with negative connotations including hospitals. Children are more vulnerable to the negative effects of such places, so best to avoid bringing them to places with negative Ying energies. This month especially is where (stray) spirits hang around all over. One thing I've often been told as a child is to avoid street corners and junctions especially when night falls lest we bump or rather they bump into us. The seventh month is not a good month for auspicious events including engagements and weddings or moving house, etc. It's even not a good month to go swimming. Old wives tale perhaps but still, better be safe than sorry.

The seventh lunar month began on July 31 ending on Aug 28. From now until the 15th day (Aug 14), you may come across elaborate prayer setups and stage shows. These are normally arranged by business organizations made up of local business owners and they are specifically for the hungry/stray ghosts that are free to roam the earth just this time of the year. Front-row seats at these stage shows are usually left vacant, reserved for the spirits. By midnight of the 15th day, i.e., Aug 14, they would all have to return to where they come from, the underworld.

For families that are not in business, they can pray outside their homes by the roadside. This act of kindness and generosity is optional but it is believed that once a family starts this tradition, it would have to be a yearly affair. Joss-sticks and candles would be lit, food, underworld currency, gold and silver ingots and clothes are the usual offerings. Other than the food, everything else would be set alight. This is the only way, the offerings can be received. This prayer ritual is carried out either on the 14th or 15th evening of the seventh lunar month depending on the dialect clan the family belongs to. Other than the family carrying out this ritual, people normally avoid going near the prayer site so as to avoid bumping into the spirits.

Today is the 10th day of the seventh lunar month of 29 days. Nineteen more days to go before we go into the 8th month, the joyous month of the Mooncake Festival or also known as the Lantern Festival which falls on Sep 12. On a brighter note, mooncakes are already on sale. I saw them on sale at Genting Highlands even in July!

Whatever..
Take care and stay safe, Everyone!


Image source: The Star

Malaysian Ringgit strengthens against the US dollar

The nation rejoices that the Malaysian Ringgit is strengthening against the US dollar and that Malaysians can look forward to paying less for imported goods. It is also good news for parents with children studying in the US as well as for travellers.

Today, The Star says Economists expect the ringgit to steadily appreciate against the US dollar with several predicting the local currency would strengthen to between 2.95 and 2.90 against the greenback in the coming months. The ringgit was valued at RM2.50 per US$1 prior to the Asian financial crisis and was later pegged at RM3.80 to the US dollar.

What does this mean to you if you earn in US dollars or hold US stocks bought when the exchange rate was above 3.5?

Poor purchasing power in Malaysia

It is common knowledge that a hundred Ringgit doesn't buy us much these days. Our poor purchasing power sees to that.

The Malaysian Insider did a check on salaries and prices in selected developed country cities and results show that despite being touted as one of the world’s least expensive cities, KL residents pay as much or even more for chicken, broadband, cars and mobile phones as a percentage of their income.

Communications, for example, is one area where Malaysians are paying notably more than residents in developed countries even after currency conversion.

For instance, a 5Mbps broadband package costs RM149 in KL while in London, a 10Mbps package would cost GBP13.50, in Melbourne a 5-8Mbps package costs AUD40 and in New York, a 7Mbps service costs USD41.95.

Those who want to buy an iPhone 4 in KL, meanwhile, would have to pay RM1990 with a basic 24-month contract while in London, residents can get an iPhone 4 for just GBP199 with a basic 24-month contract and in Singapore, it costs just SGD210 with a basic contract.

The 2010 Prices and Wages report by Swiss bank UBS AG shows that residents in KL have only 33.8 per cent the purchasing power of their counterparts in New York, 42 per cent that of London, 33.7 per cent that of Sydney, 32.6 per cent that of Los Angeles and 31.6 per cent that of Zurich.

The same study shows that on average, KL residents have to work 22 minutes to afford a loaf of bread as compared with 18 minutes in Los Angeles, 16 minutes in Sydney, 15 minutes in Tokyo and 12 minutes in Zurich.

Wait, there is more..

A Honda Civic in KL costs about RM115,000, or 20 times the average monthly salary of an auditor.

In Melbourne and London by comparison, a Honda Civic costs AUD25,000 and GBP19,000 respectively, or only about three times the average salary of an auditor in those cities.

The high cost of cars is part of the reason that Malaysians have leveraged themselves to a record 76 per cent of the country’s GDP.

Bank Negara statistics show that at the end of last year, 20 per cent of Malaysian household debt was due to cars, an asset which depreciates over time.

All this from TheMalaysianInsider..