my investment: introduction

currently, my savings are channeled into the following:

a) epf (2007 div is 5.8%)

b) capital guaranteed, dividend-based funds:
- tabung haji (2007 div is 5%, plus 2% special dividen)
- asb (2007 div is 8%, plus 1% bonus)
- kopetro (2007 div tba later in june)

c) unit trusts:
- public china ittikal fund (pcif)
- public islamic sector select fund (pissf)
- uob-osk dana islam

since i just started to learn more about financial planning, it is just natural that bulk of my invesment in on the 'safe' side of the invesment vehicles. first let's talk about epf. there's nothing much that i could do on this fund since this is compulsory (i wont be getting any pension after my retirement). currently the rate i'm paying is 11% of my monthly salary, plus 13% contribution from the company.

i will look into investing the fund in unit trust or paying back our house loan when the time comes i.e. when the balance cukup laa.

this is the simplest form of investment available for bumiputras. all we need to do is open up asb account at any major bank, and start saving. it is essentially a unit trust scheme, whereby each unit is priced at rm1.00 per unit for both buy and sell. we make money through the dividend (and bonus) given annually. no price monitoring is needed at all.

the following is summary of asb dividends given for the past 10 years:

1997: Dividend=10.25, Bonus=1.25
1998: Dividend=8.00, Bonus=2.50
1999: Dividend=10.5, Bonus=1.50
2000: Dividend=9.75, Bonus=2.00
2001: Dividend=7.00, Bonus=3.00
2002: Dividend=7.00, Bonus=2.00
2003: Dividend=7.25, Bonus=2.00
2004: Dividend=7.25, Bonus=2.00
2005: Dividend=7.25, Bonus=1.75
2006: Dividend=7.30, Bonus=1.25
2007: Dividend=8.00, Bonus=1.00

way better then average dividend given by FD! note that the dividend is calculated based on the minimum monthly balance over the year and the bonus is calculated on minimum monthly balance over ten years. i try to maximise return by consistent monthly savings and keeping the money there over long period of time plus reinvesting all dividends gained to take advantage on compund interest. -> this is something that i need to improve since i am tend to take out the savings for emergency / urgent expenditures.

personal note: need to have a separate emergency fund!

tabung haji:
i invest in the fund for the sole purpose of going to mekah later on. my target now is to go there by the time we are 35. so simpan sikit2, lama2 jadi bukit! besides, the annual return is not bad too. 2007's was the best since 2001, 5% return plus 2% special dividend. the following are tabung haji's dividend records for the past years:

1999: 8%
2000: 5.5%
2001: 3.25%
2002: 3.5%
2003: 4.0%
2004: 4.3%
2005: 4.5%
2006: 4.75%
2007: 7%

this is the company's coop. at first, i joined because i wanted to take out personal loan, but that didn't materialised due to some reason that i cannot remember. but i still continue to save some of my money there on a monthly basis. my colleagues told me that the dividend given annually averaging 10-12%, which is good! i am waiting for my first dividend which will be announced in june 2008. if it's more than 12%, then i might consider adding my monthly deductions!

all of my money are deducted straight away from my paycheck to these three funds, which is good since the less i money i see in my bank balance, the less i can spend! by proportion, out of the money that i set aside for savings, the respective percentages are:

asb : 39%
tbg haji : 21%
kopetro : 11%
unit trust: 29%

although i have been working for three years, my cumulative savings are not that much because i kept taking them out to pay for a lot of stuff; holiday to the u.s, wedding ceremony, house downpayment, etc etc. i guess it's a bit difficult to save and invest in one's early career, too many things to buy. hahaha!!

anyway, my target is from 2008 to save consistently and learn as much as possible about financial planning. errgggghhhh, i wonder why they don't teach this in school!

eh, almost forgot to talk about unit trust. since i am still new, it's enough at this junture to put the performance graph of each fund. note that as of today, the return is on negative side. but not to worry because my target is for the long term (5-7 year). as can be seen from the graph, both pcif and pissf returns for 5 months are not good. by comparison, return for piof(public islamic oppurtunities fund) for 3 years are around 70%! --> june bought this fund when she started working 3 years ago. i will be happy if in three years, pcif and pissf can replicate piof performance...hehehe.

although we cannot actually compare between funds, this is just to show the potential return through investment in unit trust.. (note: graph sourced from public mutual website):

pcif 6 months return

pissf 6 months return

piof 3 years return. yummy!


naza said...

good post! (walaupun lambat jumpa blog nih ;p) atleast aku ada idea camne nak manage my finance, with you as my basis (gaji kita lebih kurang jek kan... ;p heh)
one question tho, still berbaloi ke invest in kopetro with the current condition? selalu koperasi org tak favor sbb susah nak keluar (6 months ke ape ntah) and tak guaranteed, tho kopetro is no 6 in top 100 koperasi in msia. pls advise, nak widen my financial portfolio nih ;p

juri said...

welcome naza!
fyi, kopetro does not allow withdrawal anymore. so if nak save in kopetro, then must keep the money there until you retire/quit membership. return dia pun maintain jer for the past few years, so boleh laa kot simpan some money there. we'll see next june whether the return is affected with current economic condition or not!!!