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A Single Source of Income, is it Enough?

Is the only source of income drawn from your salary? Do you live paycheck-to-paycheck? Find out how you should kickstart adulting and handle your finances well

Is the only source of income drawn from your salary? Do you live paycheck-to-paycheck?

Read on about Ah Huat’s story – an average, freshly-graduated degree-holder.

Ah Huat, 23, graduated with a degree in Business Management and works as a management trainee in the Bank of Whatchamacallit situated near where he lives, in Shah Alam for a salary of RM 2,500.00 per month.

He calculated his estimated monthly expenses as follows to help him plan for his future:

RM 370 leftover savings was not enough for Ah Huat as he had to be prepared for emergencies as well as make plans for his future.

He decided to take up a freelancing job as a tutor to earn more. He charges his students RM 80 per hour, teaching Mathematics two times a week from 8pm-9pm. He has three students. That adds up to RM 1,920 extra pocket money a month, and a whopping RM 2,290 to save up!

With that extra RM 2,290, Ah Huat puts aside RM 1,000 for emergencies, and the remaining RM 1, 290 is used to invest because he believes that investments, whilst there are risks to it, are the only way to beat inflation.

He researches on the stock market and cryptocurrencies and invests. He experienced highs and lows but with careful investing, within a year, he managed to make an extra profit of RM 4,500. It may not seem a lot for 12 months but nobody would ever say no to extra money!

This is just the beginning for Ah Huat. As he works up the ranks and gets increment at his job, his income will increase, and with increased income, he will have more to save, more to invest, more to spend.

Is all your income only coming from one source?

Read our previous article to find out Why Trading isn’t Working Out For You

Start your trading journey at the M+ Online Trading Platform

Disclaimer: This article is for general information only and is not a recommendation, offer or solicitation to buy or sell any investment product. Investments are subject to investment risks. The risk of loss in stock trading can be substantial and you could lose your initial capital. Do seek a licensed broker before you engage in any trading activity.

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Serba Dinamik Holdings Bhd – 25th Jun 21

The on-going saga that resulted in diminishing of investors’ confidence is expected to see both institutional and retail investors continue to keep their hands off for the time being. Hence, we reiterate our stance to advise investors to steer clear of further position, pending for further clarity from the special independent audit review. Under the prevailing market events, on-going coverage is now impracticable to comply with applicable regulations and hence, we have decided to suspend our coverage on Serba Dinamik. Given the prolonged uncertainties, we have now lowered our valuations metrics and our fair value is RM0.57 (down from RM1.30).

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Dour trend may persist

The unabated Covid-19 spread in the country which may lead to further pressure on the economy, coupled with the concerns over the revised nation’s growth projection by World Bank have sent the FBM KLCI lower. Following a heavy selldown, we might anticipate bargain hunting activities to emerge on the local bourse. On a side note, the government has approved the licence and incentives for Risen Energy Co Ltd to manufacture solar cells and solar modules in Malaysia amounting to RM42.2bn, which would make Malaysia an integrated production hub for solar products.

Chin Well Holdings Bhd – 24th Jun 21

We are ceasing coverage on Chin Well Holdings Bhd due to reallocation of internal resources and the lack of retail and institutional interest. We expect trading activities to also taper in tandem with the commodities price which appears to have peaked as the Chinese government has step in to tame the surging prices by releasing industrial metals from its national reserves this month as it is difficult for manufacturers to transfer these costs to the end-users. Our last recommendation on Chin Well was HOLD with a fair value at RM1.29. The fair value is derived from ascribing a target PER of 11.0x to its FY22f EPS of 11.7 sen.

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Hovering near support

The FBM KLCI failed to extend its gains amid pervasive negative sentiment and weak buying interest, bucking the regional uptrend. With the World Bank cutting Malaysia’s 2021 GDP growth projection amid slower-than-expected economic recovery, the sideways trade is likely to persist without a fresh catalyst under the current economic and public health crisis. Investors may also look at the US’s 1Q21 GDP growth rate, while Bank of England’s interest rate decision, which will be releasing tonight. Commodities wise, the oil price has risen above the USD 75 per barrel level.

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