Wednesday, 14 May 2008

The Power of Compounded Interest

The power of compounding interest… always regarded as the best option to grow the retirement nest or children education funds but yet always neglected by younger folks.. Why many said so.. While I am in a unit trust industry, I always met older professional folks from every background which having a stash of money either in EPF or their own saving portfolios. They always quoted and saying I am lucky enough been surrounded with sound investment knowledge at younger age… :) Not like them which felt isolated with investment knowledge and options until reached middle age. Yes, how lucky but it’s not as easy as ABC.. Knowledge without application always lead to disruption.. and spoilt.. OK.. back to the topic.. The power of compounded interest can be like this – You keep investing a pre determined amount of money into investment vehicles (unit trust funds, ASB and fixed deposit) every month, reinvest the return at the end of financial year for a specific long term period.. The principle amount invested plus return every year will grow your money excessively in longer period.. So, the younger you start, will be better and more opportunity and visibility for your money to grow bigger.. Example, a young executive, at 25 yrs old who set aside RM100 every month at the beginning of every month at dividend growth of 10% per annum until age 65, his investment would have grown to RM638,000!, That is a huge money compare with only RM100 sacrifice every month. The key element to compounding is time. The longer the period of time, the greater the growth.. :)

Tuesday, 13 May 2008

Land Below the Wind - Sabah

Sabah, land with tranqulity.. rich of natural beauties.. Must go - Kota Kinabalu Park and off course, KK with pasar Filipina and its seafood.. :) The park HQ is 88 kilometers away from the city of KK. Highways and sealed roads made the Park easily accessible. It is situated on the southern boundary of Kinabalu Park, at an elevation of 1,563m (5,128 feet).

Monday, 12 May 2008

Benefits Investing in Unit Trust

Professional Investment Management
A unit trust combines the capital of many investors to employ experienced management in purchasing securities of many companies. The management of a unit trust provides diversification of investments and supervision which few investors could individually afford. Investment management is a full time job requiring specialised knowledge and training. It involves the study of a variety of factors.
Some of the factors which have to be examined are,
Comparisons of all industries in the economy
Relative studies of companies within a promising industry
Personal contact with management of promising corporations
Evaluating the effect of international events, both monetary and political
Determining the results of government policies on each industry
Professional management is also interested in studying less obvious factors such as wage rates, which might affect the economy or the profitability of certain companies or corporations. It requires careful study of individual companies within the industry to determine which of the many companies offer the best prospects for the investors. It requires comparing this company with the best companies in other promising industries. Since all this factors are constantly changing, re-evaluation and study have to be continuous.

Diversification means spreading one's investments among many securities. It is an important method of reducing risk. It decreases the danger of damaging losses, which can occur through having all of one's eggs in one basket.
Diversification is difficult and expensive for a small investor because the cost of purchasing numbers of shares in many companies at the same time is disproportionately high.
Unit trusts with their resources are able to make widely diversified investments available to even the smallest investor. Diversification involves the ownership of many different securities. All the securities owned by an individual investor or unit trust fund are referred to as an investment portfolio.

An investor can sell his units, wholly or partially, at the following trading day's unit buying price. Units have a high liquidity, that is, they can be readily converted into cash.
It has to be remembered, however, that unit trust’s units will be redeemed at the prevailing buying price on the following day after receipt of the repurchase form. The unit price may be higher or lower than the price at which the investor started the plan. Unit trusts should be regarded as a long term, rather than short term investment.

Advantages of Compounding
Many unit trust funds provide facilities for investors to reinvest their distributions. For those who opted for distribution reinvestment, the fund will automatically credit the distributions into the account, rather than sending distribution warrants.
This process of reinvesting the income from the original investment and also of reinvesting the return on the total accumulating investments is called compounding.
As an illustration, if at 25, you invested RM100 at the beginning of every month at an interest growth of 10% per annum until age 65, your investment would have grown to RM638,000 ! The key element to compounding is time. The longer the period of time, the greater the growth.

Regularity of Investing
Many people do not have substantial sums of cash available to invest, but they can develop an investment account, investing smaller sums regularly in a unit trust.
Most unit trust funds have plans available to make it possible for smaller investors to invest relatively small amounts monthly. It is easy and inexpensive for an individual to acquire units through deposits of RM100 or more a month in a unit trust fund.

Fund Administration - The Convenient Factor
Few people have the experience, time or facility to properly set up an investment programme, much less to supervise it constantly. Unit trust managers have emerged as professional organisation devoted to solving the investment problems of people from all walks of life.
Unit trusts relieve their investors of the need to handle their own securities transactions. Investors in unit trust funds are not obliged to concern themselves with matters such as,
Obtaining quotations on securities being bought and sold
Delivery and payment for the securities involved in each transaction
Safekeeping of cash and securities
Accounting and bookkeeping procedures, etc
Investors of unit trust funds will receive semi annual and annual reports which describe
a. The portfolio of the funds
b. Investment changes made in the period
c. Distributions paid, if any
d. Fund manager's opinion on the economic and market outlook
To invest in Public Mutual unit trust fund, pls contact me, Fauzi (Public Mutual Agency Supervisor) at 012-7116707

What Is Unit Trust

A unit trust is a financial vehicle through which individuals may invest their money. The idea behind unit trust is better investment through collective investing. That is to say pooling the investments of many investors, individuals and institutions.
Investing in a unit trust offers investors numerous advantages, including :
a. Professional management at a low cost
b. Safety through the spreading of risk (diversification)
c. Liquidity
d. Ease of transaction
e. Capital appreciation/income stream
The operation of a unit trust may be best explained by outlining its similarities with the operation of a bank, with which most individuals are familiar.
Many individuals deposit money in the banks, for which they receive interest. These individuals expect complete liquidity where they must be able to withdraw their deposits in cash at any time. The banks employ professional managers to look after the deposits. The deposits are invested. These managers lend the deposits to other individuals requiring funds and a host of other profit generating facilities of the banks.
Similarly, unit trust holders wish to put their money to generate higher returns. The goal of all investments is to make money more productive, either through producing income or growth. Unit trust holders have liquidity because their units can be readily converted into cash at any time. By investing in unit trusts, it allows them to engage professional fund managers at a low cost to the individual investors. These managers diversifies the investible funds in many different securities and other approved channels to spread the risk.
The unit trust is constituted through a document known as a deed which brings together and binds the various parties to the deed :
· The trustee, who holds the assets of the trusts on behalf of the unitholders.
· The manager, who is the promoter of the scheme and provides investment and administrative expertise and markets units to the public
· The unitholders who provide the funds for investment and expect to receive the benefits derived from the investment. The effect of dividing the beneficiaries' interest in the trust into units is that their interest is quantified into discrete portions.
Particular advantages of unit trusts over the pooled investments include :
· The provision of an independent trustee to hold the trust's assets on behalf of unitholders and to watch over their interests on an on-going basis.
· The deed and prospectus are scrutinised by government authorities, prior to an offer of units being made to the general public. The managers and trustee are themselves approved by the regulators.
· A buy back provision or covenant in each deed which requires the manager to redeem an investor's units within specified time limits at a price determined in accordance with the deed.
Provisions in the deed under which the manager and trustee are in a fiduciary position in relation to the trust (i.e. they can only profit in ways laid down under the deed). The investor can determine in advance what costs and charges they will be required to pay to join and stay in the trust.

To invest, call me, Fauzi at 012-7116707. Public Mutual Agency Supervisor

Start Saving..

There are a thousand ways to live on less. But you don’t want to make your life a misery. Here are some of the most painless ways you can economize, without losing out on quality of life.

Never spend a windfall. Take your income-tax refund, the RM16.35 overpayment cheque from the telephone company, cash rewards from bosses, extra money from part time jobs, profits on petrol claim any other extras and save ‘em all..

Haggle. You’d be amazed at who will drop their prices, fees and interest rates: airlines, hotels, credit card companies. Examples, Air Asia always advertised their extreme low fare in the web.. Imagine instead of holidaying at high cost, you can opt for cheaper holiday at Bali for just a couple of hundred RM.. Credit card is another option. Some of financial institution offered 9% per annum on outstanding balance instead of whopping 18%. The choice is yours.. Go and search them around.

Re-evaluate. Re-evaluate. Re-evaluate. That dinner out cost more than you spend on groceries in a week. That pair of shoes is worth half a commuter pass. Learn what your money is worth, and you won’t be so quick to dispose of it.

Get your mortgage costs down. First, look at whether the rate is too high. If it is, look at refinancing -- if you’ll save money.. Second, pay ahead on your mortgage. If you can swing an extra RM100 per month, you will save thousands in interest costs over the long haul.

Toss the catalogs. The most insidious form of spending temptation known to man or woman. Chuck them straight in the trash.. Sorry, guys.

Don’t pay unnecessary fees. Like the RM1 you pay just because the ATM is right there, right now as opposed to walking two blocks to your bank, where you don’t get charged every time you use your ATM card. Or the late fees for paying the bills late. Discipline discipline discipline…

Bank your raise. You may find that measly 3% to 5% boost in the paycheck irritatingly tiny. So add that to your direct savings basket and live on your previous salary.. 

Pay less for long-distance. Evaluate your phone bill and see how much you're paying per minute. Some dial-around codes or cheap calling cards (one without a surcharge per call) may give you a better rate. Else, go for tech.. msn messenger, yahoo messenger… is another option..

No pet pampering. Does your dog need those pricey snacks? Does your cat need acupuncture? We didn’t think so.

Never pay full price. If you must shop, discover the online world of discount Web sites. Ebay,, etc etc… you will find everything you want at cheap cheap cheap price..

Sunday, 11 May 2008

Tanjung Balau Family Gathering

This is a long long waited gathering which we have been talking for almost 4 years, with loads of places listed from Sibu Island to Cherating, but at last we settled with humbled Balau Bay Resort Desaru.


Everybody assembled at Mc Donalds Bandar Putra with Fauzi Khalid's families was a first family to arrived.. Followed by me, Ali, Mansor and families, Noh and families, Reza, his fiancee and Azila. We convoyed towards Desaru and picked Ayup at Bandar Tenggara junction. We drove for about 1 hr and 15mins and drop by at Sg Mas RnR nearby to Desaru junction for a simple lunch.. Zairi and families as well as Fairul and families joint the crowd shortly after that. After a heavy lunch for Pak Ali (hehe), we continued to the resort to check in. The resort was quite OK, a lil bit secluded from Desaru, but still fine with basic beach resort facilities likes swimming pool, wading pool, simple but tidy room.

We checked in, let the kids settled down, took a quick nap for a few minutes, then start uploading BBQ stuff to the beach front. Fauzi K was amazing leader when it comes to foods.. The drumsticks and wings looked tempted with his special made marinated herbs, just made us can't wait.. The hardest part was to start burnt the charcoal.. With a great team work, we are able to get it done in less than 20 minutes... We begin the BBQ, with great setting - beach in front of us and very nice weather.. While waiting the BBQ, kids was enjoying themselves at beach and wading pool..

First person to enjoy succulent BBQ drumstick --> as usual our kheng!, Pak Ali.. Thumbs up for the great chicken wings and drumstick.. everybody had an enough portion each. Accopanied with black pepper sausages and tangy carbonated drinks.. Great job Fauzi K.. We... automatically, gave a consent for him to be a leader for BBQ preparation next time.. :-)

Ashar and families arrived on time while we are enjoying our BBQ session. Right after a good BBQ, we had a beach soccer match.. Slow tempo, but as per normal, few kaki cannot tahan to kick the ball with full strength.. Dang..!! Pak Ali, as usual, with his wide body range and 'menggrudul' characters, been a good defender.. Ashar injured his toe after hitted by Ayup..

6 pm sharp, we headed to swimming pool.. Sad.. the resort management decided to do maintenance at that time.. but who cares, Fauzi K and Ali just can't resist the temptation to terjun dugong neglecting the sign of 'closed pool' followed by the rest until got chased out by the resort worker.. The terjun tiruk session continued at the other part of the pool.. :-)

At night, we are heading to Sg Rengit about 30 minutes drive for a seafood dinner.. Pak Ali was blabbering along the way, complaining the place was too far.. huh..

It was when we arrived at Jade Seafood Restaurant, Pak Ali, Ashar and Noh looked confused.. hehe.. with tanglung and Buddha statue in the restaurant untill someone from the restaurant gave an assurance that the place was halal and showed a numbers of celebrities, famous and famed faces photos who had came and enjoyed the food there..

Well, we divided into 3 groups. First and second table ordered, seabass with nyonya spicy sauce, fried oat prawns, chili crab with scrumptuos montow, braised home made tofu, sotong goreng tepung, spicy kangkung belacan and a jug of tangy lime juice. Third table ordered less than both table.. While waiting the dishes, kids were enjoying live lobster in aquarium.. All dishes came within a space of less than 20 minutes.. And all of us enjoyed everything with full satisfaction...

The seafood was fresh from the catch.. Amazingly, everything cost each table max RM184.. cheap..

We headed back to the resort at 1030pm.. Supposed to have a teh tarik session but everybody just can't stand with heavy dinner and good BBQ. Continued with poker session at Reza/ Ayup's room with Noh as kepala.. Heard few occasion where everybody can't resist to laugh and make fun of adrenaline pack of Pak Ali.. one of them was JQ Kheng.. no need to explain much.. The rest should know.. ;-)

We all slept at 3am..


We had bfast at 8am.. Most of us woke up late as Saturday aftnn activities made everybody tired...

Then, followed by individual free and easy session, like lazying at swimming pool's gazebo, until check out.. Good and successfull event, thanks to everybody who made this event happening.. Special thanks to Fauzi K, Zairi and Ayup and the rest of participants..