Hello Grasshoppa,

Have you ever thought about which should be your priority? Should you work to earn extra income or should you save your money better? Generally, many people will pick earning extra income as their priority. Agree? When I was young, I always have the impression where as long as I have more money, I can buy the nicest car & own the biggest house. I can shop & buy the most whatever  I want. Too bad that mindset got me into debts which still give me nightmare each time I think about it.

My definition of earning extra income can be from climbing your corporate ladder where you work day in day out in hopes that someday you can progress within your career, working your current job with another part-time job, expanding your business or even earning extra from your investment. It can be anything as long as you are increasing your income over a period of time. Saving money is by keeping a certain percentage of your income & increasing your savings from time to time. By those definitions, which is more important to you now?

This mindset that I used to have on generating more money to spend more money is very general among many people especially when it comes to young grads where they just start to earn income from their first jobs. There are also cases where they upgrade their lifestyle to suit their income or promotions. Sometimes, many of us can’t keep up with the wants that we ended up spending the money we don’t own by swiping our credit card.

I personally think that the Malaysia education system on Personal Finance is really weak or maybe I’m assuming it based on the time where I was a student. The only time I remembered on Financial Education is during Kemahiran Hidup class but they only touch very minimal on Financial Planning. Some people are lucky enough that they learned about Financial Education at a really young age where they made good decision on their personal finance. Some people learn it in a hard way just like me where I had to go through some financial debt to learn about personal finance. There are also some people that will never learn despite being in that situation over & over again. That is why I started this blog in hopes that I can reach out to as many people as possible to share on personal finance.

You can earn as much money as possible by generating RM10K or RM20K per month but if you don’t plan your financial well, that money will finish way faster than you expect it to be. Or the worst case, you will not have any savings by the end of the month. Comparing to another individual where they earn RM3K or RM5K but they choose to save or invest 10%-20% of their income before they spend. Those are the ones that are able to survive in the long run.

Recently I spoke to another friend of mine where he rented 4 shophouses for all his business. During the MCO, he was given around 30% discount for each of his unit & each rental cost RM1700 before discount. He told me that he learned a huge lesson during the MCO on better planning but he managed to pull it through with his years-long of savings. How many businesses really manage to pull it through during this pandemic? Our government is funding each individual & each sector but is their funding really enough for business to survive? Maybe it’s a bonus but it’s barely enough.

Recently, even my hotelier friend has lost his job. As we know, the tourism sector is highly impacted by the pandemic. Many companies barely compensate enough for their staff to leave the company. For those who never had any form of savings may have financial issue if a situation like this happens.

Conclusion :

“Prepare The Umbrella Before It Rains” is a good quote that you should remember especially in this situation. If you are prepared financially & mentally, this pandemic situation may give you lesser stress. Also, the Power of Habits is important for you to start your financial planning. Learn to save your money first. Like what we always hear when we are young to “Menabung”. You can always start with a small amount from RM50 or 5%-10% of your income & slowly increasing it over time. The tips is to save before you spend. This habits will allow you to manage your money better once your income increase as you will also increase your savings.

OSS!