Christopher Chong

[christopherchongcheemeng]

Too Good To be True ?!

I have invested in Forex MAM & PAMM, and I have got around 70% return a year.

Sounds too good to be true, right?!

Yea ~ Me too. I had the same thought when I heard about this platform a few years ago. One of my clients introduced it to me, and I dare not invest as plenty of scammers used Forex platforms to cheat people. Moreover, around the same time, we have the infamous FX United, IGO FX and JJPTR, etc. I could not convince myself to take the risk, as it might just be another Money Game.

In the year 2019, another two clients introduced it to me once again. One of them has been investing for 4-5 years, and continue to profit from the investment until now. The other client invested with a small amount, and keep reinvesting the profit ever since he invested in their funds. And in the year 2019 onward he started to withdraw his 5 figure profit every five weeks. When I tried to recruit one of my bankers to join me as a business partner, he introduced me to a friend who is one of the Introducing Brokers (IB) of this platform. I started to invest in this platform right after his presentation.

I admit that I was a bit irrational when I decided to invest. Ever since I invested in this platform, the fear followed me. Therefore, I kept looking for news or information about this investment platform. At the same time, I also threw a lot of questions to my IB.

The answer that I found out quite surprised me. There are a few facts that supported me to continue to invest with their traders.

1. The platform steady boh? I asked myself this question, and my wife also asked me the same. Well, I don’t have the answer. However, the platform has founded since 2010, and the fund that makes known to the market is GM Trader which started since 2013. That was the 9th year when I invested, and the GM Trader was 6 years old when I invested. So far, I had never heard of any Money Game in the Forex world which can last more than 2 years.

2. Never heard of any serious complaint about this platform in the social media or Zhang Tian Ci (MCA) office. It simply means that all the investors can withdraw their money freely.

3. The risk management of the fund is satisfactory. In the fund descriptions, it is stated that the cut lost is controlled within 5%. However, the trade record showed that they always cut lost within 0.1 ~0.5%. Besides, the max amount per trade is relatively small compared to the fund size.

4. There is an interesting fact that I found out during my journey of truth-seeking. The record in the MT4 account shown that the withdrawal amount is greater than the deposit amount. Let us think about it, if this is a scam, then why don’t they just run away with the money when the company have the fund? If they are a scammer, then they must be a lousy one.

The hater once told me, even if the platform can last long, it doesn’t mean that it is not a Money Game. Mface also lasts more than 6 years. All these Money Game always paint you a beautiful picture before you join. Besides, the record in MT4 can be manipulated...

For this statement, I agreed and disagreed at the same time. We need to look at the whole package that the broker delivers to you. Because about the same period I have also invested in another platform - CGC Asia with an estimated return of 20% per month. However, it only lasts for a couple of months then I am unable to withdraw money anymore. Now I can tell the differences between these two platforms.

There are a few signs for you to identify the Money Game

Promise a high fixed return

Could not provide any track record

When you fund your account, the currency rate is usually a fixed rate.

Impose ridiculous fees when you withdraw your profit; can be as high as 8%.

Withdrawal Difficulties. They will impose a lot of terms and conditions for withdrawal.

The withdrawal process takes more than 10 business days.

In this modern era, we should be able to access the necessary information of a broker via the internet. Unclear regulations and office address are unacceptable. A trustworthy broker will have their addresses on their websites to show that they are regulated and reliable. 

You need to understand that forex trading is not without any risk and it will not give you an instant profit. If you plan to invest in Forex, you are advised to control the amount within 5-10% of your total portfolio. Always be wary of new forex scams as the growing popularity of forex trading will only bring new types of scammers to the market. However, keep in mind that not all forex brokers are scammers; there are still legitimate brokers doing business in the market.

[christopherchongcheemeng]

Time Is Your Friend

For example, let’s assume an 8 per cent interest rate with a retirement age of 65. Interest is compounded annually.

If you were to save $1,000 a year from age 25 to 34 in a retirement account earning 8% a year, and never invest a penny more, your $10,000 investment would grow to $157,435 by age 65.

But if you don’t start saving until you’re 35 years old and then invest $1,000 a year for the next 30 years (that’s a total investment of $30,000), you’ll have only $122,346 by age 65.

Start early, so your money has enough time to pile up.

[christopherchongcheemeng]

[christopherchongcheemeng]

Summary of Penjana 5 June 2020

Summary of Penjana 5 June 2020:

Wage subsidy - extend 3 months for businesses that are not allowed to operate

The incentive for hiring the jobless person who 40 years and below, RM800 per month, 40 years old and above and OKU, RM1000 per month for 6 months

Upskilling of jobless through short courses will be subsidy RM600

RM 50 million matching grant for gig economy platform

RM 25 million to MDEC global online workforce

Work from home - RM5000 tax relief

Tax rebate for Parents for kids related expenses

MY30 unlimited travel pass for public transport on prasarana from 15 JUN until end of the year 2020

RM300 one-off payment to OKU before Hari Raya Aidil Adha

Peak B40 get extra RM50 million for medical coverage

Free internet 1GB from 8 am to 6 pm every day until the end of the year 2020. Plus free access to government covid19 websites

Each business to get: Microbusiness transition to digital to get matching grant up to RM140 million by MDEC e-dagang

Private business to run “Shop Malaysia Online” with RM70 millions matching grant from MDEC

RM700 million to PKS for digital transformation

RM2 Billion penjana loan scheme for PKS

RM1 Billion penjana loan scheme for Tourism operators

RM400 Million for small businesses

RM200 Million for bumiputra businesses

RM300 Million for Mara

Cash loan for contractors in class G2 G3

Tax incentive for business spending on covid19 related expenses

RM10 Million for MAGIC Social Activist

Tax Incentive: RM20k rebate for 3 years for new SME company establishment

Stamp Duty for a merger is waived until 30 June 2021

Investment Incentive: RM1.2 Billion for digital transformation for domestic venture capital

National Tech and Inno Sandbox to develop new technology such as drone delivery

Industry 4.0, Government to move to online counters through digitization

Campaign buy Malaysia - To encourage buying local produce

Contactless payment, RM50 credit into the e-wallet

Home Ownership Campaign to be reintroduced, property within RM300k to RM2.5Mil, until 31 May 2021

Waiver of RPGT until 31Dec 2021 limited to 3 properties per individual

Waiver of 100% sales tax for CKD cars; Waiver of 50% sales tax for CBU cars

0% tax for foreigner factories to relocate to Malaysia

5 years of 100% tax allowance for local factories

Tourism sector: -Tax delay for tourism business extended -No tax on tourism from July 2020 -RM1k individual tax relief for travel

RM225 million for culture and arts

RM350 million for agriculture

100% waiver export of palm oil until 31 Dec 2020

New covid19 law: Temporary contract relief under covid19

[christopherchongcheemeng]

Fixed Deposit (FD) Premature Withdrawal

A fixed deposit (FD) is a financial instrument provided by the bank, whereby you place your money in the bank for a fixed period, and the bank will pay you the fixed return upon maturity.

The FD can be placed with the bank from 1 month to 60 months, commonly people will make it either 1 month, 3 months, 6 month or 12 months.

Even though the interest rate is higher, if you can place your money with the bank for longer-term like 60 months, but not many people will do that. As the FD rate is fluctuated from time to time.

However, there are a few advantages that you can enjoy when you place your money in FD.

Low-risk: Unlike investing your fund in the stock market or equity funds, it is safe to place your money in FD and your returns are guaranteed.

Insured by PIDM: In the (very unlikely) event that your bank has failed, Perbadanan Insurance Deposit Malaysia (PIDM) will reimburse you with the money you have deposited with the bank, up to RM250,000.

Higher interest rates: Generally, FD gives you more interest than the savings account.

Liquidity: When you need your money for emergency purposes, you can withdraw your money at any time, although if you do that before maturity, you could lose part or all of your interest.

Here's the catch. If you perform premature withdrawal on your fixed deposit (FD) account. It is either they pay you nothing or they only pay you half the interest that you supposed to have it.

Therefore, please be cautious when you plan to place an FD with the bank, make sure you won't use that money for the period that you had to commit to the bank.

However, life is what happens to you while you're busy making other plans. Who knows, suddenly you receive a call from the Patek Philippe watch dealers and telling you that the model which you has been long waiting is finally here? Then you might need to withdraw your FD premature, and you need to forgo your interest.

Here's the solution for you.

If you really want your fund to be liquidity and yet still enjoy a higher interest rate compared to saving account, then place your fund in Money Market Fund.

Money Market Fund is not like other equity funds, it has no sales charge when you put in the fund, and no redemption charge when you perform a withdrawal. 

To show you two comparison between the FD and the Money market fund, we take an example from one of the major banks. The term and condition as below when you perform a premature withdrawal.

Immediate Fixed Deposit Premature Withdrawal (Without 31 days’ Notice Period)

No interest shall be paid on any immediate fixed deposit premature withdrawal (Without 31 days’ Notice Period) that has not completed its respective full tenure period.

Example of FD Premature Withdrawal Calculation:

FD Premature Withdrawal Interest Calculation:

= Principle Amount x Interest x (No. Days/ No. Days in a year)

= RM 500,000 x 0% x (30/365 0r 366 If leap year)

= RM 0.00

                                                     VS

Money Market Fund Withdrawal Calculation: 

* Interest For Nov : 3.25% p.a

= [Principle Amount x Interest x (No. Days/ No. Days in a year)]

= [RM500,000 x 3.25% x (30/365)]

= RM1,335.60

Fixed Deposit Premature Withdrawal (With 31days’ Notice Period)

50% of the contracted interest rate is payable when a ‘Notice Period’ of 31 days (inclusive of the day of notice) is given by the customer at the branch.

Example of FD Premature Withdrawal Calculation: 

FD Premature Withdrawal Interest Calculation:

= Principle Amount x Interest x (No. Days/ No. Days in a year)

= RM 500,000 x (3.35% / 2) x (64/365 days)

= RM 1,468.49

                                                   VS

Money Market Fund Withdrawal Calculation:

Interest For Nov 19 : 3.25% p.a

Interest For Dec 19 : 3.22% p.a

Interest For Jan 20 : 3.12% p.a

= [Principle Amount x Interest x (No. Days/ No. Days in a year)]

= [RM500,000 x 3.25% x (30/365)] + [RM501,335.60 x 3.22% x (31/365)] + [RM502,706.65 x 3.12% x (3/365)]

= RM1,335.60 + RM1,371.05 + RM128.91

= RM2,835.56

If you are looking for an alternative avenue for short-term placement, please be consider Money Market Fund. Monthly income distribution calculated daily. Fast withdrawal process: T+0 (before 9.45 am); T+1 (after 9.45 am). No minimum value of units switched. The price is fixed at RM0.50. No repurchase charge. Most importantly, it is a Tax-free income. Corporate fund shall seriously consider this, as when you park your fund in FD, the interest is subject to income tax.

[christopherchongcheemeng]

For Those Who Are“Ti Ki” + Poor Like Me

Upon the death of a person, a member of his family or a person interested in his estate must take charge to administer and distribute his estate.

When a person passes away, his assets, such as his bank account, Shares, properties, cars are all frozen. No one can deal with them and things will be left in limbo.

If he left with a will, then they can apply to the High Court for what is called a grant of probate(GP), by which an executor to his estate will be appointed in accordance with the will. If he died intestate (left without a will), then they can apply for letters of administration (LA) and to be appointed as the administrator of his estate.

For my friends who are "Tiki" like me, there are 3 ways to obtaining the LA :

They can apply to the High Court. Of course, they need a lawyer, and the cost will be definitely higher compared to those who obtain the Grand of Probate.  The tricky part is the administration needs to be bond by two sureties.

They can apply to Public Trustee of Malaysia-Amanah Raya Berhad (ARB). But, this is for those cases where the estate consists of only movable assets and the value of the gross estate must not exceed RM2mil. No administration bond is required. For the Estate administration fee, you guys may refer to their website.

They may apply to the Estate Distribution Unit of the Department of the Director-General of Lands and Mines (JKPTG) or the Land Office where the deceased’s immovable property is located. This is done under the Small Estates (Distribution) Act 1955. However, the value of the gross estate must not exceed RM2mil. Secondly, the estate must be intestate (Die without a will). Lastly, the estate must consist wholly of immovable assets (e.g, land, house or apartment) or partially immovable assets in the name of the deceased within the jurisdiction of the land office.

If you are "Tiki"+ poor like me, you can opt for option 3. In my case, even I have a property, my gross assets are still less than RM2mil. This is a cheaper and faster way among these 3 choices. The SOP on how to apply the LA to JKPTG is stated clearly on their website. The checklist for application and form can be download from the site as well.

However, I can't see the fee to obtain the grant of LA on the website. But luckily I able to source this information from the news posted on Sep 2008. The fee stated as below:

Fees are payable for the grant of LA to be issued:

> RM10, if the value of the estate is between RM1 to RM1,000

> RM30, if the value of the estate is between RM1,001 to RM50,000

> 0.2% of the value of the estate, if it is more than RM50,000.

If the fee structure is still relevant, meaning they are really charging you at the very reasonable fee. Anyway, somehow I felt that this is just relevant to me only. I realized that all my friends are rich and famous except me. So, if you are rich and famous, and yet "Tiki" and don't want to write a will for yourself. Think again...

The legal fee to apply LA to the high court is much higher than the fee to apply GP to high court plus the fee to write a will. Besides, if you are rich & famous, most probably you need two sureties for your LA application.

Do you want to become the sureties/guarantor for someone else?

Meaning to say, if the administrator runaway with the money, then the sureties will be required to pay the lost amount to the rightful beneficiaries.

Sometimes, people really take a long time to get the sureties, or never. The application of LA might be just pending forever.

This column is brought to you by Christopher Chong for your information only. It does not constitute legal advice. Just for sharing.

[christopherchongcheemeng]

Blue Blood

I’m not a member of the aristocracy. However, I always dream that my children will be one of them, and can claim that they are blue blood from the Chong family.

Unfortunately, wealth doesn’t come easily. To become a rich person, one must have the right mindset, however, the education system that I have gone through and my family bring up had pulled me down.

When I was in primary school, my parent used to tell me to study hard. Even when I have proceeded to secondary school, I was being told the same thing again. Since education was so important, I then continued my Form 6. However, I felt reluctant to pursue my studies. I strongly felt that whatever I have learnt in Form 6 have got nothing to do with my life. Yet my parent still sang the same song to me.

To them, I can have the world if I can graduate from university. We all know that’s not true.

To get closer to the money, I pursue my career in the bank after I graduated from the University. I was with the bank for 3 years. My job is to cross-selling Bank's products and services including housing loan, bancassurance and other investment products. Unfortunately, under the pressure of sales target, I became product pusher. I don’t like who a became, hence I left the bank.

After that I join insurance company and become Bancassurance Manager who provide training and also support the bank's sales team on insurance products and selling skills. A few years later, a weird thing happened, I felt like going back to school to study.

Being working in this financial industry are quite close to the money. Money goes thru my hand every day, but it doesn't belong to me. Therefore, I further my study on CFP course on the weekend to equip myself with new skills and knowledge.

It is a good decision that I further my study even after I accumulate 10 years of experience in the banking and insurance industry. Because I finally realized why Chinese always said: “Wealth and beauty can be gained through the diligent study”.

I think that this kind of courses should be included in school syllabus. With the new knowledge that I gained, now I can tell a few things about my financial portfolio:

1. My insurance coverage sufficient for my current financial position?

2. Keep track whether my money works hard enough for me? How much I need for my retirement?

3. If anything happened to me, then my loved one can inheritance my asset smoothly? Doesn’t have anything for distribution? Then how to create immediate wealth for the family?

4. Tax planning?

I may not be rich enough to classified as an upper-class person when I alive but I pretty sure when I pass away, my children will become an instant millionaire.

Have you reviewed your financial portfolio lately? Let’s have a small talk, I believe we can be extraordinary together.