i guess he is the super senior of us, and have been preaching for several decades.=)
Good advices are meant to take in, so why not we just listen to his good advices on financial planning ? I have compiled the questions and answers below, Enjoy and learn something there=)
Debt trap.
Normally, the 3 largest purchases in a person's life are
1) College education
2) House
3) Car
And, in spite of what everyone says, unless you have rich parents, you CANNOT afford to buy all 3 at the same time. If you do and most of your incomes are used to service the payment, you are taking a huge risk. If you lost your jobs for a few months, you could ends up in a debt trap. You pays every month but your debt is increasing.
In Malaysia, in general, we have variable interest rate for housing loan. And, negative amortization is not illegal. So, if the interest rate went up, you have to pay more per month or make more payments. There is a possibility of you may never pay off your house.
DO NOT TAKE A 9 YEARS CAR LOAN. Do you understand that car loan interest rate is calculated differently than housing loan?? Do you know how much interest are you paying to the bank.
The longer that you can hold off buying one of those 3 or shop around for a cheaper alternative, you will spend a lot less money on interest to the bank.
Unfortunately, it may be too late for a lot of forumer. I am sorry to say that I will be making money off you by collecting dividend from my bank's share. For some of you, you maybe spending most and if not all of your working life paying interest to the bank.
Really insightful, isn't it?
For more info, refer to :http://forum.lowyat.net/topic/326577/+40
