According to recent statistics, 0.067% of the Malaysian population declares bankruptcy in a year. Up front, it seems like a mere fraction. But crunch those numbers, and it translates to approximately 53 Malaysians every day for 365 days. Bankruptcy is no laughing matter, and basically indicates that an individual is no longer financially capable of sustaining their debts and lifestyle. There are lots of different reasons why Malaysians declare bankruptcy, but it often points to the same conclusion – not everyone understands how to protect and manage money.
Unless you want to become part of that 0.067%, earn your keep and keep it safe with these 4 expert tips.
- Insure Your Funds – Insurance doesn’t just protect your health, home, car, or your life. There are also kinds of coverage that insure your savings. Because you can never be sure about the future of your trusted financial institution, it would be wise to get a savings account in Malaysia with insurance. Ultimately, this means that if and when the bank fails or closes for whatever reason, you will be reimbursed the money you have deposited under their institution. Be careful to understand the terms however, as some banks only pay back up to a certain value. For instance, some banks only pay 250,000 Ringgit for each account, regardless of how much its contents exceed the minimum deposit required.
- Spread Your Deposits – There is strength in numbers, and the same goes for how many bank accounts you have. Spreading your savings across different accounts (preferably in different banks) will help you keep track of your savings goals more easily. For instance, a single account could be designated for a house fund, another for an education fund, and another for a emergency fund. What’s more, having multiple accounts will provide the security of having money available even when one of the accounts is temporarily inaccessible.
- Invest in a Retirement Fund – How will you be able to sustain your life when you’re older and unable to work? Building a comfortable future often starts in the present. By investing in a tailored retirement fund, you can be sure that your money is going to a cause that will protect you from financial worries in the future. Approach a retirement fund consultant to find out what options are available to you, and fabricate a plan that will benefit you in the future based on what you expect out of your career and lifestyle.
- Pay Amortization in Advance – If you’ve taken out a loan for your car or your house, don’t wait for your monthly due before you put out payments. If you have the financial legroom, make payments in advance so you can check those expenses off your list for a few months. This way, you can focus on your current daily spending and plan better for the money you have in your hands at the moment. If you’re earning more than you expected to, you can talk to your lender to consider shortening the loan term to reduce your interest and speed up the payment process.
Just because bankruptcies in Malaysia are common, doesn’t mean you have to fall into the same problem. Remember, you are in charge of your money as it’s in your hands to protect and preserve what you earn. Follow these 4 tips to keep your funds safe and live a worry-free financial life for many years to come.