Have You Planned for Your Retirement yet? (1)

Every month end we will hear people saying “When can I finally have enough money for my retirement?”, “Where does all my money go every month?” or even “Why isn’t there any money in my savings account?”. Does that sound familiar to you? In fact, people who earn a decent living and still have problems making ends meet are probably in the majority.

After 3 years of working in IT related environment, I’m now getting a monthly salary of RM2100. Very low, right? Especially when you are staying in KL. And you can imagine, I couldn’t save any RM at the end of the month. Well, I don’t blame, I’m that price. I won’t quit the job because I need this money to pay my bills. How many of you are in my situation currently?  quoted from BB Market Place Blog.

These days earning money is not easy especially employees. Unless you are the business owner, but even a business owner also need to know how to spend their money wisely. Have you asked yourself if you can make your hard-earned ringgit stretch further by adopting a healthier spending attitude towards money management and becoming a careful spender? I have read thorough an interesting article from The Star Newspaper by Joyce Chuah and I find it very useful. Hope that from this guideline will give us better spending habit and easier to achieve our retirement goal. There are 2 chapters on monetary tips.

The biggest monetary wastes

Extravagant dining Malaysian just love to eat, like Steven Goh. As families in Malaysia become more affluent and more air-conditioned food outlet are opened eating out become a social norm and we spend more at restaurants. 

Gambling I read an interesting fact once that the chances of striking it rich at lotteries was slimmer than being hit by terrorists! According to one report, gambling can be more addictive than smoking or drinking and is potentially a silent but quick robber of our savings. Gambling during occational festive season get-togther with relatives or friends is acceptable. If you celebrate Chinese New Year, the gambling must end after Chap Goh Meh.

“Premium” coffee It is ok to treat yourself occasionally with a premium coffeehourse blend. However going there is part of your routine every other day, you better kick your caffeine addiction and put the saving somewhere else more profitable.

Cigarettes If you are a heavy smoker, it’s unlikely that you understand the economic significence of a daily packet of cigarettes over a lifetime – presiming, the smoke you inhale permits you to live a full lifetime. Say a young man starts smoking a pack a day at the age 20 and continues until age 70. Assuming cigarettes per pack remains RM8.20 without inflation (this will never happened), the money that gone on smoking at the age of 50 years is RM149,650 or RM2,993 per annum. If these money is keep away in a fix deposit at 4% per annum, after 50 years the return is RM456,932 in his retirement account. Anyway, explain if you explain this to a smoke addictor is like singing to a cow.

Paying too much interest Do yu routinely pay your credit card balances promptly and in full. so that you are not charged an interest? Those who carry unpaid balances over from month to month may find that they are on credit card company’s list of super customers. Paying off credit card in full every month is very important. Use the credit card wisely and get the credit card company to vary the patment cut-off dates.

 If you can narrow down your spending on above list, you are half way success on securing your retirement plan. Stay tune for another chapter on budgeting for necessities for the other half of success.