How to Make Money From Unit Trust?

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It strikes me as strange that those who claimed to be"investors" particularly those long term investors are shying away from the current low price equity market. Why "investors" and not investor? Well, to me, a genuine investor is a long term opportunist who takes the view of long term to realise profit from their investment venture. They will continue to invest especially in the current all time low priced equity market as they know that eventually the market will correct itself. This group of opportunist will invest more especially when the equity market is cheap and will reduce their investment when the market is bullish. However, as they are unsure how low or high the market could go, they invest on a regular basis and are very cautious during peak period or rather when "investors" are entering the market at a feverish speed. A smart investor would have slowed their activities when this group of followers / "investors" continue to invest heavily. I believe Warren Buffet belongs to the former group as he has this infamous quote "Be greedy when the market is fearful and fearful when the market is greedy".

Investment is viewed as a medium to long term instrument and never as a short term tool to make money. Those who entered the market with the hope that they would realised profit within a short period of time (less than 3 years) should call themselves as high risk taker/gambler/follower but never as an investor. A gambler is a person who is taking the risks, either a calculative or a blind risk to earn profit within a short period of time. An impatient lot who gets burnt frequently unless lady luck is by his side.

There are several ways money could be made from Unit Trust if the investor is willing to wait for at least 3 years. Is it a long waiting period? Only you would know.

First, if an investor entered the market at 25sen/unit and the market price shot up to 30sen, of course profit has been made and this is called capital appreciation. Please note, we will ignore service charge in the illustration here to ease explanation. Good to get in touch with your consultant if you are unsure however, you will note that nowadays, all transactions are very transparent as detailed description of the costs involved is clearly stated on the transaction slip. The cost price to use as your benchmark is the price per unit plus service charge.

The greater the disparity in the price the greater the profit margin. On the average, most funds / equities have declined between 30 - 50% from their high value of the bull run season of 2007! So, to those who are investing during the current equity sales period, they are actually buying at 30 - 50% discount and if translated loosely, the potential for them to earn is equally the same once the bull starts seeing red again! Therefore, since the current market price is so cheap, the percentage of loss has been gravely (no pun intended) reduce!

Secondly, generally though not compulsory, Unit Trust company declares distributions by the end of a particular fund's financial year end. It has been said that during distribution, the investor is given what actually belongs to them and therefore it makes no difference to them. Or in layman term, the distribution is given from the left pocket to the right pocket. This however is not true. I used to have the same thinking too until I became a part of the consultant team - in other words, I learnt. No doubt the company pays the investors using their existing fund's value but if you are to look closely, what the company did was to LOCK IN the profit for you. What they did was to reduce the price of the fund on the day of the financial year end and convert the "price difference" into units (at no cost) which increased the number of units held by you. The good news is that the distribution payment is dependent on the number of units held by you! Therefore, the greater the balance of units held the greater the payout would be. I need to reiterate that one of the objectives of investing in unit trust is to accummulate units and is NOT dependent on its pricing unlike buying shares. Imagined, if the company does not lock in the profit for us , the price plunged and no extra units in our account?

Thirdly, as the units held increased due to continuous investment or distribution, the average cost per unit of the fund will further reduced. This scenario further translate to greater profit to the inverstor as their cost is reduced. The impact is greater especially during lowly priced fund period as the units purchased would be more compared for the same amount paid during peak period. Please refer to my previous write up on Dollar Cost Average.

Investing through Unit Trust is very easy and affordable. Easy as it is managed by a team of professional and competent Fund Managers and monitored by your Consultant. Affordable as the minimum investment amount for initial investment is only RM1k whereas top up minimum value is only RM100. That is why at times, I called it as a savings tool due to the flexibility it provides to its savers as they could save as and whenever they have the extra cash or afford to do so. No commitment unless the savers have their own long term financial goal that they want to achieve.

Choice of the fund company is also important. Look at the company's background, track record, fund managers, fund's objective, etc. No doubt there are so many funds and companies that offer such services, as an investor it is our responsibility to do some homework ourselves to choose wisely. However, if still undecided, you could choose several funds from several fund companies. Try to diversify the choice of funds to minimise your risks. Am sure, after several years, you would know which fund or fund company that is able to meet your investment objectives.

So, those who belongs to the "investor" category, it is wise to relook at your investment objective and financial goals once again. If gambling is not your cuppa tea, it is good to take a long term view and start planning on investing for long term purpose. As today's price has never been this ridiculously low, plan on investing on a regular and affordable basis and spread it out over a long period of time and wait. Never, I repeat, dump all your money at once into the equity market. Rather,take the gradual and consistent investment approach. Since you are already in the market, there is no point bemoaning the paper loss that you are experiencing now as they are just paper loss. Take a practical approach and look at the abundance of opportunities available for investment for the long period. I am very sure, you will see the profit in the not too long future compared to cashing out now and suffering loss and cursing this wise investment tool which many people are still unsure of. However, do bear in mind, all investments come with risks but the risks is greatly reduced as you take the long term approach. Be a smart investor and just wait.

Managing $$ Part 6: GIV

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Part of the reasons for being rich is so that we are able to give to others who are in need. Mr T Harv Eker is of the opinion that it is our responsibility to be rich so that others may benefit as being poor would make us be a burden to other people especially our loved ones. Furthermore, being rich for yourself may not be a good motivator to success but if we are to include other people in our reasons for being rich, we may find the fulfilment for living.

Have you heard of this adage, "the more you give, the more you will receive"? I guess we could not have more if our jar is already full. Therefore, by giving, we are actually creating space for the universe to fill up thus creating more for yourself. It's difficult to describe here but I hope you could understand.

Click here to read about some multimillionaires who are great philanthropers

Therefore, in our quest to manage money successfully, it is suggested to allocate at least 5% of our revenue/income to charity/to those who are in need or for a cause which you believe/support. Those who wishes to allocate more is to take the extra amount from the Necessity Jar only. However, if the revenue / income that we are earning is insufficient for us to contribute for a good cause, we could trade it with our time. Time similar to money is precious. Therefore, for those who are unable to contribute cash, sharing your time with other people who either need assistance and/companion is equally honourable. Some of the causes which I used to or currently support are Malaysian Nature Society (MNS), All Women's Action Society (AWAM) and other impromptu requests.

Besides being a good giver, we must learn to be a good receiver too. All things comes in pairs, black/white, in/out, up/down, long/short, rich/poor, hot/cold, etc. This is to ensure balance and ability to create more.

How do you feel when you give something to someone genuinely? Happy? Great? In order to reinforce the good feeling of that giver so as to empower his/her power of giving, the recipient's ability to accept the gift with warmth and gratitude without returning the same favour (on the same day) helps. One good example that I could think of is when receiving a compliment. As a recipient of a compliment, a simple thank you to the giver is suffice. It is a norm for us to return a compliment to the giver but in actual fact, that reduces the giver's joy of giving and the reciprocated compliment becomes fake! Ouch! So, if you as a receiver needs to return the same, do it some other time and create a genuine compliment not because you have to!

Take it and own what has been given and be thankful!

Cheerio!

Managing $$ Part 5: PLAY

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The 5th jar should be an interesting account to create - the Play jar. Yup, if you have been following my blog ;) you'll note that this jar is set aside to help us satisfy our playful side/child in us or just to have fun. This is an equally important jar however, it is imperative to use it completely every month or in the event the amount saved is insufficient to serve its purpose, you may accummulate the amount up to the max of 3 months only.

Our life needs to be balanced; work and play. All work and no play makes us a dull person. Furthermore, in order to manage our money successfully, this jar has its purpose. Have you ever wondered why at times the money that we have been saving (the traditionaly way) seems to be in the deficit? At times on purchases that we later regret? Or we just bust our account in a particular month especially during our all time emotional low period?

Therefore, the play jar could be viewed as our emotional release jar which we could spend on anything that we like. This jar is also an "ALL ABOUT ME" jar. Use it only on yourself and for yourself. Pamper yourself. Go crazy and do something fun! As you practise this, observe its effect on you. Hope you'll like it!

Have fun!

Managing Money Part 4: EXP

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Malaysia's inflation rate jumped to a 26-year high of 8.5 percent in August 2008, driven by the escalating cost of food and fuel. It is said the cost of food and non-alcoholic drinks rose 11.7 percent in August compared to a year ago.

The August data showed escalating prices in most categories, including transport which jumped 21.8 percent, and restaurants and hotels which rose 6.5 percent.

Malaysia's government hiked the fuel price by 41% in June 2008, in a move to rein in the ballooning cost of subsidies but it has on numerous occasions since then lowered the fuel price from a high of RM2.70 to current price of RM2.30 when the global fuel price has decreased from a high of USD147/barrel to USD69/barrel in October 2008.

The high inflation is already hurting many consumers especially those with fixed income with many Malaysians cutting down on food bills.

In managing our money, it is suggested that one's expenses should be lower than one's income to ensure that there is surplus for other uses eg savings and investment. The recommended amount that one should cap on one's expenses is 55% max.

Some of the suggested ways to ensure that our expenses do not exceed the 55% cap is by preparing a budget and identify our needs from wants. Following a budget requires discipline however, if a person stays focused on his financial goals, the whole process could be easier.

Identifying one's needs and reducing or eliminating one's wants would help tremendously as priorities are set thus reducing wastage of resources and ensure there is a surplus for other usage.

In the event that the situation does not permit one to place a cap on his expense account due to the depleting purchasing power of cash, it is recommended that one should look for another source of income to boost his take home pay.

Managing Money Part 3:LTSS

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Let's continue with the basic wealth creation lesson...managing money (thought I had forgotten about this huh?).

The 3rd account shared by T Harv Eker is called the Long Term Saving for Spending account (LTSS). This account is created to enable us to fulfill our dreams of owning something in the short to medium term eg notebook (my 12 year old nephew's wish list), house, car, holiday, etc. The recommended amount to set aside is 10% of our net income..... to purchase whatever you desire. However those who have more than 1 item (max 2) in his/her wish list is to halve the required amount (5% x 2). The time taken to save to achieve your dream is dependent on the amount set aside, however, to expedite the process, one of the ways that you could do is to increase your income :) It is still 10% max for this account as we have other uses for the extra cash.

Managing our money is imperative to ensure that we do not spend what we do not have. Do avoid using credit facility if possible unless you are able to repay it promptly or the return for taking the loan is greater than the cost of repaying the loan itself. This is considered a good loan.

A most popular and easily available credit is credit card. Nowadays, many such companies are issuing preapproved cheques to their customers! Credit card if used wisely could be a blessing but if abused, it could be the beginning of your nightmare!

I personally like the use of credit card as it means having to carry lesser cash - for security reason. Furthermore, we are able to redeem the accummulated points against the vast array of products offered by the company free vs cash payment which has no benefits. At times, using credit card enable us to purchase a certain goods/services at special price or via instalment method with zero cost. All these are being offered at no subscription fee at all (it is time to change your credit card if you are paying the annual fee). Moreover, a copy of our monthly expenses transaction is provided by the company enabling us to record our spending and thus facilitating keeping track of our expenses. These are the benefits of using credit cards and it remains to be so as long as we clear the full amount due from us promptly. Please bear in mind that it does not mean paying the minimum amount but the full amount due on the statement. Paying only the minimum amount means you are taking a very expensive credit facility offered by the credit card company (15% - 18%pa) and it could be the beginning of your sleepless night!

Malaysians who are having problem with their credit card payment and need counselling, please refer to Agensi Kauseling dan Pengurusan Kredit (www.akpk.org.my) for assistance.

As mentioned in my previous blog, spending could be fun now but it is wiser to save and invest as much as possible for your future.

Managing Money Part 2: EDU

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Hey, didn't managed to post my entry last week as I was away for training and it was an awesome week for me! It was a 5 day training and last till past 11pm and therefore had to recuperate for another day in Singapore to avoid having the panda's eye look. But it's worth it!

Continuing our previous entry on managing money, hope you are excited about this, the next jar that I'll introduce is the Education jar. What a coincidence! ;) ;)

Would you agree that our income is in parallel to our knowledge/skill? Therefore, putting aside 10% of your net income to improve your skills and knowledge is imperative if you desire to see your income grows. Training should be continous and should not be restricted to vocational / technical skills as soft skills eg management or leadership skill is equally important.

Depending on your interest or your vocation, investing in public seminars, books, magazines or even to learn new skills or opportunities to expand your mind and interest is highly recommended too. For example, if you are interested to learn more about investment and the various tools available, sign up for such seminar which is abound in the market. At times, such seminar is even FREE! Therefore, by investing your time and/money in such knowledge we are actually shortening our learning curve as we learn from other people's experiences, ideas and mistakes and thus enable us to achieve our dreams faster with fewer mistakes.

At times, from such trainings or even reading certain books, you would even discover new things about yourself which you never knew or even opportunities that you did not know exists thus enables you to explore further and hopefully finds your new destiny. Exciting isn't it?!

Therefore, invest in yourself and see how it rewards you in the future! But of course, knowing and doing what you've learnt (action) have to go hand in hand in order to see some results otherwise, it is just knowledge. Input must have an output => results. Hope the below audio/video would inspire you to ACTION! You have to click (act) to view though.. Ke, ke!



Just to share with you, to create this blog, I took the time to attend the class held in Kota Kemuning on a Sunday morning. Even though the class was free, but by making the commitment to learn something new and spending the time and losing my way there (as I've never driven to Kota Kemuning before) I've acquired a new skill which enable me to share and teach via this lovely channel. That's the reward for investing in learning new skill and am proud of myself for that! :) Furthermore, I've also found a lovely place for a nice bowl of duck noodle ala Bidor. Yum, yum!

Managing Money Part 1: FFA

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This time, I would like to share an idea by T Harve Eker on managing money.

According to Mr Eker, in order to have great wealth, one has to know how to manage whatever wealth one has right now before greater wealth could come. Based on his observation and experience, he said that people who possesses poor money management skill would not be rich as they are capable of losing everything within a short period of time.

What he has said reminded me of the Felda settlers' case of many years who were paid millions of ringgit by the government for taking over their land for development purposes. Most of these land owners became millionaires overnight but did not maintained their rich status for long as they used whatever they had to settle their existing debts AND incurred further debts as they purchased more material possessions that do not increase their Networth Value.

Mr Eker, author of The Secrets of the Millionaire Mind is of the opinion that money should be used to generate more money so that it is able to produce passive income to support the lifestyle that we desire for a long period of time.

Being a practical person, he has shared with us his method of managing money...

Create 6 jars or accounts. This week, I'll elaborate on the first jar ie the Financial Freedom jar.

This jar is our Golden Goose (hope you remembered the Golden Goose story otherwise click below video). The objective of this account is (yup) give us our financial freedom. We could only deposit money into this account and withdraw it only to invest, buy a business, or any ideas that could help to generate more money/income. This account is to be left as a legacy. It is important for the next generations to be taught the same method of managing money. The amount to be placed into this account is 10% of your net income.



The income generated from this account could be used to support your lifestyle but in no circumstances should the principal be used/spent. If you recalled the Golden Goose story, the principal is the bird itself and its egg is the income. It is advisable for us to use the eggs initially to produce more birds so that there will be more eggs to be enjoyed later. Spending the principal placed in this account is liken to killing the goose that lays the egg.

If we are able to use the eggs wisely and protect the goose/geese, we need not have to worry about our future as there will be adequate eggs to enjoy for a long period of time.

So, save and invest now so that it could multiply (the effects of compounding) and become big enough to acquire more goose to produce eggs for you daily. One way to achieve this is to live a simple life so that your objective for a comfortable life in future is achievable for a long period of time.

Start managing what you have now, no matter how little it is, and you'll be rewarded in due time.

Spending Now Can Be Fun But........

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Spending money now can be fun, but it can hurt your future financial well-being if you don't save enough.

I was at a seminar on financial planning organised by SIDC yesterday. An enlightening and full of insight seminar which has reinforced what we've read, taught and learnt on the importance of budgeting and financial planning. This is oh-so-true especially in our current high inflation!

Higher gas and fuel prices are making it harder for us to do something that most of us are not too keen on anyway—saving for the future. Now that economic times are tough, many of us are looking for ways to cut back spending.

To permanently cut spending and increase our savings requires a shift in attitude. However, by cutting back, you're not really giving up anything. The money you saved will still be available for future needs. Plus, if given enough time to compound, those savings double and triple in value when invested properly—giving you even more to spend later.

At the seminar we were reminded that overspending today makes it impossible to achieve dreams tomorrow—whether the goal is a major purchase, an early retirement, or an adequate income in retirement. Save enough now so you can maintain the same standard of living throughout your life

One of the ways to reduce expenses is to analyze exactly how the money is being spent. Retain and record your purchase receipts. At the end of the month, analyse them. Identify which is your need and want. Am sure you'll note that the items in "want" list is recommended to be reduced or eliminated.

Match your spending to your goals and values in life. Align your spending with what you think is really important to you. The process of cutting spending would really makes you look at what you want to get out of your life and assist you in setting your priorities. Coincidently, I have also sent an email on The Secret of Wealthy Living which I hope is helpful to you.

With this perspective—thinking long-term and focused on what really matters to you—cutting expenses can be easier.

Controlling spending requires extra thought every time you open your wallet—being an educated, responsible consumer. It can take some time to adjust to a tighter budget. Extra measures are usually needed to help people stick to a new spending regime eg hiding or cutting your credit card? You may liken it to a diet. If you don't focus on it, it won't happen. Just as dieters need to step on the scale and tally up their calories and exercise each day, spenders must track expenses carefully.

However, does cutting back means depriving yourself? I've also noted that T Harv Ekar, author of The Secrets of the Millionaire Mind, advocates his readers the essential of setting aside 10% of our net income as our "play fund". According to him, it is important for us to satisfy the child in us otherwise the deprived feeling may cause us to blow our hard earned money thru irrational purchases whenever we have a windfall. Makes sense especially for those who are used to spending! Therefore, set aside a little bit of money each week, perhaps $10 or $20, for small luxuries or just for fun! ;)

And that's the whole point of cutting spending: The goal is to save money now so you can continue enjoying your money—on both essential and frivolous expenses—for decades to come.

How to Achieve your Dreams in this high Inflation situation?

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From my past blogs, you'll noticed that I have been harping on the issues of investing in the current low priced equity market. The current market conditions, brought about by the States' mortgage prime issue, seems to have domino effects on other countries' equity market even though they do not have the same problem back home. That's baffling isn't it? Its surprising that the State could be saddled with such problem despite not too long ago, Asian countries were saddled with somewhat 'similar' financial crisis. The States apparently do not practice what they had preached to the East who viewed them as their 'panadol' to their various ailments. Well, since our usual panadol has a problem, I wonder who will be bringing the next remedy to cure the current ailment?

I heard over the news that the crude oil price is expected to go as high as USD180 this year and could even touch USD200 next year! What does this mean? Worse equity market and higher inflation?! So which is your greatest fear?

I recalled when I was working in an office building in Kuala Lumpur between 1992 - 1994 which houses a share trading company and a very chic chinese restaurant. During lunch time, the same restaurant could either be very busy or very quiet depending on the share market of the day. When the market was doing very well, one of my colleagues used to take leave to sit in the trading house together with many retirees who even carried their own foldable stool as there were insufficient seats due the house being full. The office lifts were also packed and the only conversation that was swirling in that little lift cabin is ...you guessed right and with lots of excitement too! The restaurant would be housepacked and being a chinese restaurant, whether its chic or otherwise, the noise was impeccable! That was the good times. The opposite holds true when the market was down and weak. Reserving a table in that same restaurant for lunch was very easy.

What's the effect on me at that time when the equity market was good or bad? Well, at that time, I was very ignorant about share market but knew that good money could be made if we choose the right share. But being a non investor, I could only feel the excitement or the quietness of the market only. However, over the years, I had noticed that the money that I had been hoarding in the bank's account gave very low return that it was insufficient to buy what I've desired ie a house or good holiday. This had caused me to be bold to dabble in the share market but of course I piggyback on one of my relatives who used to make lots of money from share market. Guessed what? Called it back luck, I lost everything and as the chinese used to say, there's no dust left!

The moral of the story is......whatever happens to the share market, it does not affect the non investors. However, all of us, living mortals, have dreams ie to buy house, dream holiday, retire comfortably, start a business, etc and all these requires money. We do hope to achieve our dreams quickly and safely.

We knew that placing our money in a place that's safe ie bank would not help us to achieve our dreams in this lifetime and therefore, we need to invest to earn greater cash and at shorter time so that we could enjoy our fruit whilst we are still here. Besides, if we are to place our money in a place that does not give us higher return than our inflation rate, our cash purchasing power will depletes and we need to work extra hard and longer to ensure that we have enough cash to buy our dreams. All these are vicious cycle and if we are not careful, we may end up chasing for more and more money and no time for ourselves or family.

Being ignorant about investment does not mean we do not invest.

Based on my experience, since investment is necessary, we need to piggyback on someone who is the expert ; no, I don't mean an "expert" investor according to our definition but a professional person who has good track record and has a mission to create and accummulate wealth for its investors.

Dabbling in the share market is too risky for most of us due to various reasons, therefore, my recommendation is to place your "future" with a mutual fund company with good track record. Furthermore, the risk is minimal, diversified and managed by professionals. That frees you to do what you are skilled in and let the experts take care of your money.

I am able to recommend mutual fund with certainty based my experience with one who is currently still managing my money. Right now, I am even promoting their services to those who care enough about their future and prefer their money to work hard for them.

As always, invest with long term in mind, and with the current bearish market, there's no better time but now to gradually pick and invest in your favourite funds. Do regular savings and you'll be rewarded in due time on this new habits of yours .

Happy realising your dreams!

p/s: Am able to post this blog as am right now confined to the house due to bad cough and loss of voice. Might as well use my down time to share my 2sen worth of thoughts!

Inflation: The Silent Killer

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Inflation, to me is like cancer. On the outside everything looks fine but its effect to its host by wasting its cells is unknown until its too late.

Inflation reduces the value of money but the written value on its surface remains the same. The pinch could be felt every time price adjustment is being carried out and once inflation has set in, it never leaves. Thus, the buying power of cash deteriorates as inflation increases.

In treating leukemia, the number of red cells is being increased to overcome the white cells count. Similarly, to overcome cash's reducing puchasing power, we need to generate more cash faster than its depleting rate. To do this, investment is the only way to generate more cash. It could be in various forms and its choice is dependent on its owner's capability, experience, knowledge, etc.

Generally, investment knowledge is very low in Malaysia. We have never been taught in school nor in uni. Most of us were only aware about it once we have had started working and depending on the type of crowd we associate with, our knowledge expands accordingly. It is easy to blame our education system, friends, teachers, parents, etc but the onus is on us to do something to improve our current situation. Therefore, one form of investment that is very important, to me, is to invest in knowledge relating to wealth creation. It could be in the form of books, magazines, journals, seminars, trainings, or just network with the correct group of people, you'll notice your learning curve is shorten. So does this equation makes sense "income = knowledge". I do now. :)

Inflation could be seen as a foreign word to lots of people as they are aware that prices of goods are increasing but did not realise that is the effect of inflation. Despite having known that the cost of goods and services have increased, yet they do nothing to protect what they have had worked hard for. They merely adjust their way of life as they try to fit into the changing economy. Most of the time, they work harder chasing for more money whose value keeps reducing in order to maintain their standard of living. Is that what life is all about? No wonder it has been known that Asians are the hard working lot!

It has been said that the rich lets money work for them. I guess they realised that much earlier thus able to be where they are now than the ordinary people who are still in the dark, chasing money.

The rich invests so that their money works hard for them whilst the poor works to pay for their expenses. The rich use their passive investment or business income to support their desired lifestyle, the poor continue working for money and be a slave to money. Which is your preferred choice?

Since we knew that inflation reduces our money buying power, don't you think you should multiply it quickly by letting your money works hard for you and be your slave instead of the other way round? So, is investment important? You decide.

Smart Investor

Smart investors are those who:

(1) do not follow the herd
(2) buy when price are low
(3) do regular investment to take advantage of Dollar Cost Average benefit
(4) are not involve in speculative investment but invest based on strong fundamentals
(5) look at long term

It's a fact :-)

Market ALWAYS comes back/rebounce.

Money

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Money is one of the most important subjects of your entire life. Some of life's greatest enjoyments and most of life's greatest disappointments stem from your decisions about money. Whether you experience great peace of mind or constant anxiety will depend on getting your finances under control.

-Robert G. Allen-


The moral of the excerpt above is Manage Your Money Well!!

Invest or Not to Invest

Sharing a thought...You Don't Have to Believe a Word that I Say

"Is it the right time to invest with the current volatile and uncertain market condition?" A very frequent question whenever I meet a new prospect. Worries clearly reflected in their eyes.

Being an investor myself, I knew the feelings......."Oh my God, market down again! Die lah, I am making losses now! When will the market improve? Ahhhhh!!!"

It is normal to feel as you do, as we are humans, an emotional one too. Therefore, your decisions to invest or not is also emotionally influenced. Agree? So, isn't it better to leave your investment matter to a third party ie fund manager to manage your investment instead? The investment vehicle that I am referring to is unit trust.

So back to the earlier question, should we invest in the current market?

I am of the opinion that it depends on the individual itself. If the investor has intention to invest for a period less than 3 years, then no. This is because no one knows how long it would take for the market to bounce back. Moreover, investing with such a short frame of time disallow any fund managers to do their work effectively thus posing higher risks to the investors themselves. On the other hand, investors that are coming in for long term is however encouraged to pick up the funds that are currently at huge discount. The current market situation is considered an extended MEGA SALES period for long term investors. Pick them up before the sales is over!

Another word of advice, do regular savings instead of a one time off investment. It is one of the ways to mitigate the risks of uncertainties and volatilities. The benefit is that when the fund's price is high, the units purchased would be lesser, however, when the price is low, at the same investment amount, the number of units purchased would be more. In the long term, the average cost per unit of the investment would be lesser than its current market price thus the investor would have made some profits already.

Another factor every individual should be aware in deciding whether they should start investing their hard earned money is whether they are willing to face the risks of inflation which is undermining the purchasing power of their cash.

A research was done by The Star newspaper last year stating that our money's purchasing power diminishes amidst rising inflation. It gave an illustration that the cost of 3 meals NOW costs us about $20-00 (minimally) and in 20 years time, with the assumption that the inflation rate is only 6% , the same meal would costs us a whopping $64! It goes further to illustrate that those who have $500,000 NOW has a purchasing value of only $145,000 in 20 years' time!

So tell me, could you afford not to invest or you would prefer to procrasinate? And miss the discount?!