Why Most Malaysians Stay "Average" with Their Money (And How You Can Break Free)

 

Introduction: Escaping the Average Money Trap

Walk into any mamak at night, and you’ll hear the same stories:

• “Gaji tak cukup…”

• “Kereta baru beli, installment mahal...”

• “Takde saving, susah nak kahwin…”

The truth?
Most Malaysians stay financially average not because of fate — but because of habits.

Today, we’ll break down why many people stay stuck, and more importantly, how you can break free and build real wealth.

The “Cashflow = Survival” Mentality

In Malaysia, many live paycheck to paycheck:

• Salary comes in.

• Expenses eat up 90%–100%.

• Maybe RM50–100 left by month-end.

This cycle feels normal because everyone else is doing it.
But normal ≠ good.

Reality Check:
If you save nothing today, you're borrowing from your future self.

Key Reasons Most Stay Average

✅ 1. No Budgeting Habit

"Tak cukup duit" is often because there’s no plan, not because income is too low.

✅ 2. Lifestyle Inflation

Every time income goes up, spending goes up faster. New car, new iPhone, bigger house.

✅ 3. Zero Investing

Savings die slowly under 2–3% bank interest, while inflation eats away purchasing power.

✅ 4. Fear of Taking (Smart) Risks

Many avoid investing, side hustles, or entrepreneurship due to fear.

✅ 5. Following the Crowd

Investing because "kawan suruh" or spending because "semua orang buat" leads to disaster.

How You Can Break Free

1. Build Emergency Fund First

• 6 months of expenses minimum.

• Tabung Haji, Maybank MAE, Touch n' Go Go+ for short-term.

2. Invest Systematically

• Start with unit trusts, robo-advisors like StashAway, REITs, EPF voluntary top-ups.

3. Increase Financial Literacy

• Read one finance book a month (start with The Psychology of Money).

• Follow reputable Malaysian finance blogs.

4. Mind Your Circle

• Spend time with people who talk about investments, businesses, growth — not just gossip.

5. Set Financial Goals

• RM100k savings by 30?

• Passive RM2,000 income monthly by 40?

Write it down, break it into steps, and track monthly progress.

Malaysian Real-Life Example

Average Joe

• RM5,000 salary

• RM4,800 expenses

• RM200 "savings"

• Net worth growth: almost none

Smart Sam

• RM5,000 salary

• RM2,500 expenses

• RM2,000 savings/investments monthly

• Net worth at RM100,000+ by 30 years old

Small differences in daily habits = Big differences in life outcomes.

Conclusion: Dare to Be Different

It’s easy to stay average — blame the government, inflation, bad bosses.

It’s harder but far more rewarding to be different — to take ownership, save aggressively, invest wisely, and focus on your own growth.

Because in 10 years, you'll either be someone complaining at the mamak table — or someone financially free ordering the roti tisu without checking the price.

Which one will you choose?

Why “Pay Yourself First” Is Still the Best Money Advice for 2025

 

Introduction: The Oldest Financial Rule Still Wins

"Pay yourself first."

You’ve probably heard it. Maybe even brushed it off.

But in a world of TikTok finance hacks and crypto memes, this one classic rule remains king — and it’s more relevant than ever in 2025.

Today, let’s understand what "paying yourself first" really means, why it works so effectively, and how Malaysians can apply it to build lasting wealth.

What Does It Mean to Pay Yourself First?

It means prioritizing your savings and investments before you spend on anything else.

When you receive your salary, the first action is saving a portion, investing a portion, and then living on the rest.

✅ Not the leftovers.
✅ Not "after all expenses are paid."
✅ Right at the start.

Example:
If you earn RM4,000 a month, immediately allocate:

• RM600 to savings/investments (15%)

• RM3,400 for bills, rent, groceries, lifestyle

No matter what happens that month, you have secured your financial future first.

Why It Works: The Psychological Power

• Automates Discipline
  You never "feel" the missing amount because you never had a chance to spend it.

• Builds Habitual Wealth
  Just like brushing your teeth, saving becomes automatic over time.

• Prevents Lifestyle Inflation
  You adapt your spending to what’s available after savings, not the other way around.

How Malaysians Can Apply Pay Yourself First

✅ 1. Automate Transfers
Set up auto-debits to savings/investment accounts (e.g., ASB, StashAway, Tabung Haji) right after salary day.

✅ 2. Start Small, Grow Big
If 20% feels overwhelming, start at 5% or 10%, then increase gradually.

✅ 3. Separate Accounts
Maintain separate "Spending" and "Saving" accounts to avoid temptation.

✅ 4. Prioritize Retirement Accounts
Max out EPF voluntary contributions or invest into PRS for additional tax relief.

✅ 5. Budget Backwards
Base your lifestyle budget after deducting savings — not before.

Malaysian-Specific Example

If you consistently save RM500/month into an account earning 5% returns:

Year	Total Savings (RM)
5	34,000
10	78,000
20	205,000

Small amounts, saved consistently, turn into big freedom over time.

Bonus Tip: Pay Yourself First Even with Side Income

If you’re freelancing, earning Shopee sales, or cash bonuses — apply the same rule:

• 20% to investments

• 10% to emergency savings

• Spend the rest guilt-free

This ensures every income stream grows your wealth, not just your expenses.

Conclusion: Secure Yourself First

The simple act of paying yourself first is a game-changer.

It’s not sexy. It’s not "viral." But it works — always.

In Malaysia’s ever-evolving financial landscape, the one who saves and invests consistently will always have the upper hand, regardless of salary size.

So next time your salary hits — remember: your future self comes first.

The Real Meaning of Financial Freedom (And How Malaysians Can Achieve It)

Introduction: Freedom is More Than Money

When you hear the term "financial freedom," what comes to mind?
Lavish holidays? Fancy cars? Mansion living?

Maybe.
But at its heart, financial freedom simply means control over your time, energy, and choices—without constantly stressing about money.

In Malaysia, where living costs are rising and financial scams are rampant, understanding and pursuing true financial freedom is now more important than ever.

The Common Myths About Financial Freedom

Before we talk about building it, let’s clear some air.

✅ Myth #1: You Need to Be a Millionaire

Reality: You just need enough to cover your living expenses sustainably.

✅ Myth #2: It’s Only for Rich Kids

Reality: Anyone—regardless of background—can build financial freedom with planning and discipline.

✅ Myth #3: You Need to Retire Early

Reality: It’s about choice, not retirement. Financial freedom gives you the option to work or not, but it doesn’t force you to stop working.

The 5 Stages of Financial Freedom

1. Financial Stability
   ➔ You cover basic expenses without stress (bills, food, transport).

2. Debt Freedom
   ➔ You clear all bad debts (credit cards, personal loans).

3. Financial Security
   ➔ Passive income from dividends, rental, etc. covers essential expenses.

4. Financial Independence
   ➔ Passive income covers lifestyle expenses like vacations, hobbies.

5. Financial Abundance
   ➔ You have more than enough to support yourself and others (philanthropy, legacy planning).

How Much Do You Need in Malaysia?

Here’s a simple estimation:

Lifestyle	Monthly Expenses (RM)	Target Retirement Fund (5% Yield)
Basic	2,000	480,000
Comfortable	5,000	1,200,000
Luxurious	10,000	2,400,000

(Assuming a 5% net withdrawal rate from investments like REITs, EPF dividends, or balanced portfolios)

Practical Steps Malaysians Can Take

✅ 1. Build Emergency Savings First

• 6 months' living expenses in Tabung Haji, ASNB, or high-interest savings accounts.

✅ 2. Maximize Your EPF and PRS Contributions

• Aim for 30%–40% savings rate if possible.

• Consider voluntary top-ups to EPF for 6%–6.5% returns.

✅ 3. Invest for Passive Income

• M-REITs for dividend income (~5–6% yield).

• StashAway for diversified ETF exposure.

• ASNB fixed funds for low-risk growth.

✅ 4. Control Lifestyle Inflation

• Just because you earn more doesn't mean you need a new car every 5 years.

✅ 5. Increase Your Income

• Freelancing (Fiverr, Upwork)

• Part-time e-commerce (Shopee, Etsy)

• Monetize skills: copywriting, tutoring, digital marketing.

✅ 6. Protect Your Wealth

• Life insurance

• Critical illness coverage

• Basic estate planning (simple will)

Psychological Traps to Watch Out For

Even if you save and invest wisely, mindset matters.

Beware of:

• Keeping up with peers' lifestyles ("Everyone's buying a Mercedes, so should I")

• Overspending on weddings, houses, vacations

• Falling for get-rich-quick scams (unlicensed "forex", crypto promises)

Freedom is about discipline, not reckless spending.

Example Malaysian Case Studies

Case A (Success Story):

• Started saving 30% of salary from age 25

• Invested mainly in REITs and EPF

• Reached financial independence by 45

Case B (Struggler):

• High salary (RM12,000/month)

• No savings discipline, heavy car loans, lavish lifestyle

• Financial stress at 40 despite good income

Moral of the story?
Financial freedom is about habits, not income size.

Conclusion: Your Freedom, Your Rules

Financial freedom doesn’t mean living without working—it means working on your terms.
It’s waking up on Monday morning because you want to, not because you have to.

In Malaysia, where inflation is creeping higher and traditional job security is weakening, achieving financial independence is no longer optional—it’s essential.

Start small.
Stay patient.
And remember, every ringgit you save today buys you freedom tomorrow. 

How to Calculate How Rich You Really Are (And Why It’s Not Just About Income)

 

Introduction: Income vs Wealth — Don't Be Fooled

Many people equate a high salary with wealth.

But in truth, wealth isn’t how much you earn—it’s how long you can survive without working.

This idea is simple, but life-changing once you internalize it.

Let's explore why calculating your true wealth matters more than boasting about your monthly paycheck.

Defining True Wealth: It's About Time, Not Salary

Wealth = How long you can maintain your current lifestyle if you stop working today.

If your expenses are RM5,000 per month and your savings are RM100,000, your wealth is roughly 20 months.

Meanwhile, someone earning RM20,000 per month but spending RM19,500 monthly has only a few weeks’ worth of true wealth if they lose their job.

This perspective shifts how you manage money—from chasing high incomes to building durable assets.

How to Calculate Your Real Wealth (Step-by-Step)

Step 1: Calculate Your Net Worth

• Assets: Cash, investments, property (current value)

• Liabilities: Debts like car loans, mortgages, PTPTN loans

Net Worth = Total Assets – Total Liabilities

Step 2: Calculate Monthly Expenses

• Housing

• Utilities

• Food

• Transportation

• Lifestyle

Step 3: Divide Net Worth by Monthly Expenses

This will give you the number of months you can survive without income.

Examples

Person	Monthly Income (RM)	Monthly Expenses (RM)	Net Worth (RM)	Months of Survival
A (Doctor)	15,000	14,000	30,000	~2 months
B (Accountant)	5,000	2,000	100,000	~50 months
C (Blogger)	3,500	1,500	80,000	~53 months

Notice that Person C is wealthier in real terms than Person A, even though Person A earns 4x more!

Conclusion: Focus on Building Wealth, Not Chasing Salaries

Ultimately, the goal is not just earning a lot—it's owning your time.

Financial freedom begins when your passive income and savings cover your living expenses, freeing you from dependency on active income.

Let’s start measuring wealth properly from now onward!

Passive Income Ideas for 2025: How to Make Money While You Sleep

 “If you don’t find a way to make money while you sleep, you will work until you die.” – Warren Buffett

In today’s world, relying solely on a 9-to-5 job may not be enough to secure long-term financial stability. That’s why passive income is a game-changer. It allows you to earn money with minimal effort after an initial setup, giving you financial freedom and peace of mind.

Whether you’re looking to supplement your salary, save for retirement, or achieve complete financial independence, passive income can help you get there. In this post, we’ll explore some of the best passive income ideas for 2025 that you can start today.

What Is Passive Income?

Passive income is money you earn without actively working for it on a daily basis. Unlike your regular job, where you trade hours for money, passive income allows you to earn even when you're not working. Common sources include investments, online businesses, and rental properties.

While passive income streams require an upfront investment of time, effort, or capital, they can generate long-term financial benefits. The key is automation and scalability, so your income continues flowing in with minimal maintenance.

Why Passive Income Matters in 2025

The world has changed dramatically over the past few years, and so have the ways we earn money. Here’s why passive income is more crucial than ever in 2025:

✅ Rising Living Costs – Inflation continues to increase expenses, making multiple income streams essential.

✅ Job Uncertainty – Economic fluctuations and layoffs highlight the importance of financial security.

✅ Retirement Planning – Depending solely on EPF or 401(k) savings may not be enough. Passive income can help fill the gap.

✅ Lifestyle Freedom – More people are embracing remote work, travel, and early retirement. Passive income makes this possible.

Best Passive Income Ideas for 2025

Now, let’s look at some of the best ways to build passive income this year.

1. Dividend Investing – Get Paid for Holding Stocks

Dividend stocks are one of the most reliable ways to earn passive income. Companies that pay dividends distribute a portion of their profits to shareholders regularly (usually quarterly).

📌 How to Start:

• Invest in blue-chip stocks with a strong dividend history (e.g., Maybank, Public Bank, Coca-Cola).
• Consider dividend ETFs for diversification (e.g., SPYD, MyETF Dow Jones U.S. Titans 50).
• Reinvest dividends to compound your wealth over time.

💰 Potential Earnings:
A RM50,000 investment in a 5% dividend yield stock can generate RM2,500 per year in passive income.

2. High-Interest Savings & Fixed Deposits – The Safest Option

If you want completely hands-off passive income, high-yield savings accounts and fixed deposits are great options.

📌 How to Start:

• Look for banks offering the best fixed deposit rates (currently around 3.5%–4% in Malaysia).
• Consider digital banks like CIMB OctoSavers, KDI Save, or Touch 'n Go GO+ for competitive rates.

💰 Potential Earnings:
A RM50,000 deposit at a 4% annual rate can generate RM2,000 yearly in interest.

3. Rental Properties – Earn from Real Estate

Owning rental properties can provide consistent passive income through monthly rent payments.

📌 How to Start:

• Buy a property in a high-demand area (e.g., KL, Penang, or Johor Bahru).
• Rent it out on long-term leases or short-term platforms like Airbnb.
• Consider REITs (Real Estate Investment Trusts) for real estate exposure without property management.

💰 Potential Earnings:
A RM500,000 property with a 5% rental yield can generate RM25,000 annually.

4. Selling Digital Products – Make Money Online

If you have a skill, why not turn it into a digital product? Unlike physical products, digital products require no inventory and can be sold 24/7 worldwide.

📌 How to Start:

• Create and sell ebooks, courses, templates, printables, or stock photos.
• Use platforms like Gumroad, Etsy, or Udemy.
• Automate sales with a website and digital marketing.

💰 Potential Earnings:
A RM100 digital course selling 100 copies per year = RM10,000 passive income.

5. Affiliate Marketing – Earn by Recommending Products

Affiliate marketing allows you to earn commissions by promoting products or services online. When someone purchases through your link, you get paid.

📌 How to Start:

• Sign up for Shopee, Lazada, Amazon, or Rakuten affiliate programs.
• Create a blog, YouTube channel, or TikTok to review products.
• Share your affiliate links on social media.

💰 Potential Earnings:
Top affiliates earn thousands per month, but beginners can realistically make RM500–RM2,000/month.

How to Build Passive Income Efficiently

💡 Here’s how to maximize your passive income efforts:

✔ Start Early – The sooner you begin, the faster your wealth compounds.
✔ Diversify – Don’t rely on just one stream; have multiple sources.
✔ Automate – Set up automatic investments and recurring earnings.
✔ Reinvest Profits – Use your earnings to generate more income.

Final Thoughts: Build Wealth While You Sleep

Passive income isn’t a get-rich-quick scheme—it requires patience, strategy, and consistency. But once it’s set up, it can provide financial freedom, security, and even early retirement.

Financial Lessons from Warren Buffett: How Malaysians Can Apply Them

Warren Buffett, the "Oracle of Omaha," is one of the most successful investors of all time. With a net worth exceeding $100 billion, his investment philosophy is widely studied and admired. But what makes Buffett truly remarkable isn’t just his wealth—it’s the simplicity and timelessness of his financial wisdom.

Many of Buffett’s principles can be applied not only by stock market investors but also by everyday Malaysians looking to build financial security. Whether you’re saving for retirement, investing in stocks, or just managing personal finances, Buffett’s strategies offer valuable guidance.

Let’s explore some of his key financial lessons and how they can be adapted to the Malaysian context.

1. Spend Wisely and Live Below Your Means

Buffett’s Lesson:

Despite being a billionaire, Buffett still lives in the same house he bought in 1958 for $31,500. He avoids unnecessary luxury and focuses on value rather than prestige.

How Malaysians Can Apply This:

Many Malaysians fall into the trap of lifestyle inflation—spending more as their income increases. From upgrading cars to buying luxury items on credit, these choices can strain long-term financial health.

To apply Buffett’s principle:

• Stick to a budget and track your expenses.
• Avoid unnecessary debt—credit cards and personal loans should be used responsibly.
• Don’t overspend on a car. Cars in Malaysia are expensive, and taking a long-term loan for a depreciating asset isn’t ideal. Consider second-hand cars or more affordable options.

2. Invest for the Long Term

Buffett’s Lesson:

Buffett believes in buying great companies and holding them forever. He avoids short-term speculation and market timing.

How Malaysians Can Apply This:

• If you invest in stocks, focus on fundamentally strong companies with consistent earnings and a history of paying dividends.
• Consider Exchange Traded Funds (ETFs) if you’re not confident in stock picking.
• Avoid frequent buying and selling—long-term investing benefits from compounding returns.

A good example is Public Bank Berhad (PBBANK)—one of Malaysia’s most stable and well-managed banks. Those who invested in it many years ago and held onto their shares have seen significant returns over time.

3. The Power of Compound Interest

Buffett’s Lesson:

Buffett famously said, "My wealth has come from a combination of living in America, some lucky genes, and compound interest."

How Malaysians Can Apply This:

• Start investing as early as possible to maximize compounding.
• If you’re saving for retirement, take advantage of EPF (Employees Provident Fund) and consider additional investments like PRS (Private Retirement Scheme).
• A simple example:
  • If you invest RM1,000 per month with an average return of 7% per year, in 30 years, you will have RM1.2 million—most of it from compound growth!

4. Never Invest in Something You Don’t Understand

Buffett’s Lesson:

Buffett avoids complex investments and only invests in businesses he fully understands.

How Malaysians Can Apply This:

• Don’t invest in stocks, cryptocurrencies, or forex just because others are doing it. Always do your own research.
• If an investment sounds “too good to be true” (e.g., guaranteed high returns), it’s likely a scam.
• Many Malaysians have lost money in Ponzi schemes like JJ Poor to Rich (JJPTR). Buffett’s rule? Avoid what you don’t understand.

5. Keep Cash Reserves for Opportunities

Buffett’s Lesson:

Buffett always has billions in cash ready to take advantage of market downturns.

How Malaysians Can Apply This:

• Always maintain an emergency fund (at least 6 months of expenses).
• Keep some cash reserves so you can invest when opportunities arise (e.g., when stock markets dip).
• In 2020, during the pandemic, Malaysia’s stock market crashed, and many undervalued stocks became attractive. Those who had spare cash could buy at a discount and enjoy great returns later.

6. Focus on Increasing Your Income

Buffett’s Lesson:

Buffett believes in improving your skills and investing in yourself to increase earning potential.

How Malaysians Can Apply This:

• If you’re in a job, upskill and look for higher-paying opportunities.
• Consider starting a side hustle—online businesses, freelancing, or passive income sources.
• Malaysians can explore gig economy jobs like Grab, Shopee Live selling, content creation, or investing in rental properties.

7. Be Fearful When Others Are Greedy, and Greedy When Others Are Fearful

Buffett’s Lesson:

Buffett advises investing when markets are down and avoiding hype-driven speculation.

How Malaysians Can Apply This:

• During stock market downturns, don’t panic sell—consider buying instead.
• Avoid following trends blindly—during the Bitcoin hype of 2021, many bought at all-time highs and later suffered losses.
• Think long-term: Instead of chasing hot stocks, look for companies that can survive and grow over decades.

Final Thoughts

Warren Buffett’s principles are timeless and simple:
✔ Live below your means
✔ Invest in what you understand
✔ Take advantage of compounding
✔ Keep cash reserves
✔ Grow your income

By applying these lessons, Malaysians can build wealth steadily and achieve financial security.

A Fresh Start: Mastering the Art of Budgeting for a Prosperous Year

As we step into a brand-new year, the air is thick with possibility and hope. It’s a time for reflection, resolutions, and fresh beginnings. For many, this season serves as a reminder to get finances in order and set a solid foundation for achieving both short-term goals and long-term dreams. And what better way to start than by mastering the art of budgeting?

As Warren Buffett famously said, “Do not save what is left after spending, but spend what is left after saving.” This timeless wisdom encapsulates the essence of effective budgeting—prioritizing savings and consciously allocating expenses to maximize the value of every ringgit.

Why Budgeting Matters

Budgeting is more than just numbers in a spreadsheet; it’s a philosophy that empowers you to take control of your financial destiny. A well-crafted budget can:

• Help you manage daily expenses without stress.
• Prepare you for unexpected emergencies.
• Enable you to achieve financial goals, like owning a home or starting a business.
• Build healthy habits that secure a comfortable retirement.

In short, budgeting is the roadmap to a life of financial freedom.

Step 1: Understand Your Financial Landscape

Before creating a budget, you need to know where you stand. Here’s how to assess your financial health:

1. Track Your Income: Note all sources of income, including your salary, freelance work, or side hustles. This gives you a clear picture of how much you’re working with each month.

2. Categorize Your Expenses: Break your expenses into categories like:

   • Fixed costs: Rent, utilities, car loans, etc.
   • Variable costs: Groceries, dining out, entertainment, etc.
   • Discretionary spending: Shopping, subscriptions, hobbies, etc.

3. Analyze Spending Habits: Look at bank statements or budgeting apps to identify where your money goes. Are there areas where you could cut back?

Step 2: Adopt the 50/30/20 Rule

One of the most popular and effective budgeting strategies is the 50/30/20 rule, introduced by Senator Elizabeth Warren in her book “All Your Worth: The Ultimate Lifetime Money Plan.”

• 50% Needs: Essential expenses like housing, food, transportation, and insurance.
• 30% Wants: Non-essentials that add joy to life, such as dining out, vacations, or hobbies.
• 20% Savings and Debt Repayment: Allocate this portion to savings accounts, investments, or paying off debts.

This approach ensures that your finances are balanced, leaving room for both necessities and enjoyment while building a safety net for the future.

Step 3: Create Your Budget

Now that you understand your financial situation and have a framework in mind, it’s time to create your budget:

1. Set Realistic Goals: Whether it’s building an emergency fund, saving for a down payment, or traveling, define your goals with timelines.

2. Choose the Right Tool: Use tools like budgeting apps, Excel templates, or even a notebook. The key is consistency.

3. Plan for Unexpected Costs: Set aside a portion of your budget for unplanned expenses like car repairs or medical bills.

4. Automate Your Savings: Set up automatic transfers to a savings or investment account so you’re not tempted to spend the money.

Step 4: Stay Accountable

Budgeting isn’t a one-time task; it requires commitment and regular reviews.

1. Review Weekly: Check your progress and adjust where necessary. Did you overspend on dining out? Plan to cut back the following week.

2. Celebrate Milestones: Hit your savings goal? Treat yourself to something small—it reinforces positive behavior.

3. Involve Your Family: If you’re budgeting as a household, ensure everyone is on the same page. Shared accountability makes it easier to stick to the plan.

Famous Quotes to Inspire Your Journey

Here are a few more pearls of wisdom to keep you motivated:

• “A budget is telling your money where to go instead of wondering where it went.” – Dave Ramsey
• “Wealth consists not in having great possessions, but in having few wants.” – Epictetus
• “Money is a terrible master but an excellent servant.” – P.T. Barnum

Budgeting Tips for Success

1. Keep It Simple: Overcomplicating your budget increases the likelihood of abandoning it. Stick to a straightforward format that works for you.

2. Use Technology: Apps can simplify tracking and analysis.

3. Avoid Lifestyle Inflation: As your income grows, resist the urge to increase expenses. Instead, channel the extra money into savings or investments.

4. Start Small: If the 50/30/20 rule feels overwhelming, start with a 70/20/10 split and adjust gradually.

5. Focus on the Long Term: Remember that budgeting is a marathon, not a sprint. Be patient with yourself and celebrate small victories.

Closing Thoughts

As the saying goes, “Every journey begins with a single step.” Budgeting might seem daunting at first, but it’s a powerful tool that can transform your financial future. By taking control of your money, you’re laying the groundwork for a more secure, stress-free, and fulfilling life.

May this be the year you achieve your financial goals and more. Cheers to a fresh start and endless possibilities!