Wealth Building, Retire Early, Personel Money, Financial Planning, Saving Tips
If you want to grow your wealth steadily in long term, you must remember this rule, protect your capital. Protect your capital means never loss the initial money they you have invested. If you invest RM5000 in turbulence stock market just as end of 2007, you must learn to protect your capital by cutting loss to prevent further losing which eat up your initial capital.
credit through askmen.com
I went for Market Chart co-organized by Maybank Investment Berhad and Bursa Malaysia in few days ago. The speaker were Richard Kang and Lee Cheng Hooi.
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Employee Provident Fund or EPF saving can be used for investment if you are capable to outperform the dividend declared by EPF. EPF members can withdraw their EPF saving from Account 1 for investment in unit trust fund.
I started my investment journey at the end of 2007 in ASNB. I know nothing about investment that time. What I know is the dividend rate of ASNB is higher than fixed deposits rate in bank. That’s all. Since I have extra money not in use, so I get my all extra into the ASNB. All these year ASNB gave me 6-7 percent dividend.
I had opened a Gold Saving Passbook Account(GSPA) from Maybank on 17 March 2009. The economy was still not yet recovery form great depression more than half year ago. Investor was still panic in stock market. Thus, all investor flush to gold investing.
Today, I have my first stock investment in life. I had bought 2 units of Gpacket at 0.695. Yes, just 2 units as I have limited saving in hand. My first principle for investing is never borrow for investing. Just invest what you have. The purpose of investing is to hope that our money work for us instead keeping in bank waiting for depreciation cause by inflation.
Maybe you are curios why I buy this stock since it is in red ink and deep in dept RM50.1 million, correct me if mistake. I also feel that I am taking too much risk on it. In common sense, would you invest in a company that deep in debt? I guest probably not. If not invest in this stock, there are still plenty of stock available with better attractive company cashflow right?
Compounding interest is the phenomenon where the interest given is re-invested consecutively to the original fund.
The compounding interest might not make much different in the initial year however, it make a remarkable different in amount in the end of a long-term period. The chart below is taken directly from Smart Couple Finish Rich by David Bach which the author had give the permission for anyone to duplicate it to share with their friend.
