One planner in every family

It is a pity that so few people are into financial planning in Malaysia. A lot of heartache can be avoided if financial planners can reach out to more people to educate them in their financial plans. I was at a recent financial planning seminar and some statistics and facts that were given was very encouraging. It was noted that the equity(stock) market is the best investment a person can put their money into. In the long run (5 to 10 years), the equity market can give a return of more than 10% return per annum. The next interesting fact was that the reason for investor not achieving this return was that they run too fast when a crisis hit. The basic principle of investment is to buy low and sell high. However when the market is low (soft), people are less likely to invest because the fear of market going lower. STOP AND THINK! How much lower can it get. Equity market over time improves and the strategy is to invest on a regular basis fixed amount of money or what the financial planners call DOLLAR COST AVERAGING. Do this and you will be surprise on how your wealth will grow over time.

People are very careful with their money and trusting someone else to handle their money is difficult. Here is where education and trust comes into the equation. If one family member put in extra effort to learn about managing and investing the money in a safe and well diversified portfolio of shares (using Unit Trust schemes) then he or she can share the benefits of investment with other family members as the family members would trust him or her. This would be ideal as all the family members would benefit from it. Give it a thought.