What Is The Best Way To Invest RM100,000

8 11 2011
I got a lot of e-mail asking about they have RM100,000 cash and not sure what to do with the money or where to invest the money i,e Unit trust, Stocks, Properties, Gold, Silvers, Starting a new small business etc.
Some of them are very excited as they managed to save up or get a big windfall(bonuses). They wish  to increase that number by investing but don’t know how to.
One of the first step to Financial Freedom is by taking control of your financial life. You cannot depend on others i.e Government to take care of your financial well being.
Personally, I feel instead of asking “where” to invest, focus on  the “what”, “how long”, “does it”, “can you”, and “who”.
You will get a clearer ideas on how deal with your money after answering the 5 questions below
Ask and answer yourself these 5 questions:
1. What is the Objective and Goal of this Investment?
The plan for Retirement planning and Investment Planning are totally different as every one has an unique Investment risk Profile
2. How long is the investment Horizon before I can cash out the money?
The time horizon for properties generally  is much longer than compare to stocks due the limited liquidity.(Unless your properties were is in  a hot location)
3. Does it effect with my financial resources?
I am sure you don’t want to put all your money into just one basket of investment vehicle,right? The the next question is Do you have time to learn and monitor all the investments?  Assuming to chosen to invest stocks futures using technical and fundamental analysis, can emotionally  not attached to it and would not effect your current job and financial resources
4. Can I live with the risk involved?
Investment in stock and stocks futures have a high price movement  volatility. Can you stomach the risk involved?
5. Who will managed the Investment?
It’s good to let other to managed the Investment. However this may not be the best choice. Do speak to your financial planner to find out more.
Once you are able to answer the above 5 questions, do invest some time to learn about different investment alternatives. This is a journey as it’s not something you can learn from a few days or months.
The doctor takes more than 4 years of studies before able to prescribe a medicine. What makes you think after a month of studies, you can be expert in a particular investment?
It’s impossible to be successful until you understand the behavior, basic fundamental and what you’re investing in.
There are many financial magazines, books and web sites such as Personal Money, Bloomberg etc, that would gave a good start for understanding the basics of personal finance.
In conclusion, the key is always Educate yourself in investing!



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