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Investing in the stock market can be rewarding yet absolutely terrifying. If you’re a budding investor just getting started, you might have questions about which stocks are worth considering. Such questions can even overwhelm a seasoned investor. The stock market offers a myriad of investment options for investors. Among these options are small-cap stocks. Small-caps are companies that often fly under the radar but can offer substantial growth . Examples of well-known companies that started as small-cap include Monster Beverage Corporation, which is now a leader in the beverage industry, and Under Armour, which began as a small-cap company and has grown into a major player in sports apparel. New investors often shy away from small-cap companies, but they do offer promising investment growth. In this article, we’ll breakdown everything you need to know about small-cap stocks and share strategies on how you can invest in these hidden gems. How is a stock classified by market cap? Market capitalisation (or market cap) is the total value of a company’s outstanding shares of stock. Stocks in the stock market are classified based on their market capitalisation, or market cap, as large-cap, mid-cap and small-cap. Understanding the differences between them will help you make better informed investment decisions. Today, we’ll focus on understanding what small caps are all about.   What are Small-Caps? Small-caps are publicly traded companies with a market capitalization between RM300 million and RM2 billion. These companies are typically in the early stages of growth, making them exciting opportunities for investors. Examples of Malaysian small caps include PADINI , AEON , and ASTRO . Characteristics of Small caps Growth Potential Small-cap companies often have significant growth potential. They are typically younger companies or companies serving niche markets. Volatility These stocks tend to be more volatile than large cap and mid-cap stocks. Their prices can fluctuate widely due to lower trading volumes and higher sensitivity to market conditions. Risk and Reward Investing in small cap stocks may seem riskier, but the potential for high returns is also greater. These companies might struggle with limited resources and may be more vulnerable to economic downturns.  How to Spot a Small Cap Step 1: Identify a small cap Start scanning for small companies. Get on a stock screener  and spot any company with a market cap valued between RM300 million and RM2 billion. Step 2: Identify a strong business Next, identify a strong business. Focus your search efforts on finding companies with the potential to deliver explosive growth. That means looking for companies that could be the next Apple  or Netflix .  Here’s what to look out for when looking for small caps:   1. Explosive Growth Potential Focus on companies with consistently increasing revenue. This indicates strong sales and potentially innovative products or services in high demand. Aim for at least 20% annual revenue growth, but be cautious if growth slows, as it could signal a maturing market or fading trend.  A classic example of a once-small-cap company is NVIDIA , a leader in graphics processing units. They began their journey as a small-cap company, trading at a mere 35 cents per share in 1999. Fast forward to today, and their share price has skyrocketed by an incredible 229,000%. This phenomenal growth trajectory exemplifies the explosive potential that small-cap companies can offer! 2. Stock Price Appreciation Evaluate the historical stock price. A steady upward trend suggests investor confidence in the company's future. Conversely, stagnant or declining prices might indicate challenges. Remember, past performance isn't a guarantee, but it offers valuable insights. 3. Total Addressable Market (TAM) TAM refers to the annual expected sales within an observed market. Imagine the TAM as the size of the problem a company's product or service solves. A larger TAM signifies a broader customer base and more room for growth. For example, an AI company tackling a massive industry like healthcare has a much bigger TAM than one focused on a niche market . 4. Future Profitability While some small caps may not be profitable yet, they should demonstrate a clear path towards future profitability. Analyse the company's business model, its competitive edge (what makes them unique), and any valuable assets they possess. Look for improving profit margins, even if they haven't reached profitability yet. These signs suggest the company is on the right track. Small Cap Myths Debunked Myth Reality Small caps are too RISKY!  While small-cap stocks can be more volatile, this doesn’t necessarily translate to higher risk. The level of risk varies depending on the company’s industry, management, and financial health. Some small-caps are stable and have strong growth potential.  For instance, over the past 10 years (as of June 2024), the Russell 2000 has delivered an average annual return of 12.5%, compared to the S&P 500's 10.2%. Small-cap companies are generally not profitable. Some small-cap companies offer attractive dividends due to their historical nature and the desire for yield from families and shareholders. According to Robert Beauregard , these stocks offer a higher dividend yield (2.51%) compared to established indexes like the S&P 500 (1.83%) or the large-cap world index (2.34%). This means you could potentially earn more income from your investments while still enjoying the growth potential of smaller companies. Small caps are poorly managed. Many small-cap companies are led by skilled and experienced management teams who are deeply involved in the company's growth and success. Small caps are only suitable for speculative investors.  While small-caps can be more volatile, they are also suitable for long-term investors willing to research and have a higher risk tolerance. Should I include Small Caps in My Portfolio?  As an investor, it’s crucial to understand the risks involved when investing in individual stocks. Your investment is directly tied to the performance of the specific company you choose. If you invest in a small-cap company with strong fundamentals and a healthy outlook, the stock is likely to grow over the long term. However, if the company underperforms, your investment could lose value. As mentioned before, small-cap stocks tend to be more volatile, meaning their prices fluctuate more than those of larger companies. For instance, in 2023, over half of US small-cap stocks lost 10% or more, despite the overall market gaining about 26% for the year. Thorough research and risk management will be required when considering small-cap investments. If you don't have the time or expertise to make your own trading decisions, consider working with a financial advisor. There are two ways to invest in small caps: Buying Individual Stocks: This means you directly purchase shares of specific small companies you believe will show potential growth. Buying a Fund: This involves investing in a mutual fund or exchange-traded fund (ETF) that focuses on small-cap stocks. These funds hold shares of many different small companies, offering diversification, and are managed by professional fund managers who make investment decisions. For most investors, a broadly diversified mutual fund or exchange-traded fund (ETF) is a better option than picking individual small-cap stocks. This is because these diversified funds spread your investment across many companies, reducing the risk of losing everything if one company performs poorly. If you do decide that investing in small-cap stocks is right for you, you can buy and sell shares of individual companies  directly through online trading platforms. But, if you find buying individual stocks seems too risky or time-consuming, you can opt to invest in small-cap focused ETFs and mutual funds.  RHB Small Cap Jewel Get exclusive access to Malaysia's top 20 high growth small-cap companies, curated by RHB Research. Sign up here  to grab your copy of RHB’s 20th Anniversary Small Cap Jewels. Tips for Investing in Small-Cap Companies 1. Do Your Research It’s important for you to do your homework before you start investing in any company. Look at the company’s business model, competitive position, management team, and growth prospects. Financial statements, earnings reports, and market trends are good places to start. 2. Diversify Your Portfolio Never put all your eggs in one basket. Diversify your investments to manage risk effectively. By spreading your investments across various small-caps and other asset classes, you can balance potential risks and rewards. 3. Consider Small-Cap ETFs or Mutual Funds If researching individual stocks feels too overwhelming, consider investing in small-cap exchange-traded funds (ETFs) or mutual funds. These funds provide exposure to a basket of small-cap stocks, offering diversification and professional management. 4. Start Small As a new investor, start with a small investment in small-cap stocks. This allows you to get comfortable with market dynamics without risking too much of your capital. 5. Be Patient Investing in small-cap companies often requires patience. These companies may take time to grow and deliver returns. Keep a long-term perspective and avoid making impulsive decisions based on short-term market fluctuations. Conclusion In conclusion, with adequate research, investing in small caps could be a valuable addition to your portfolio. Small caps may offer you the chance to be at the forefront of innovation and, in some cases, potentially enjoy attractive dividends. Remember that every investment carries risk, so it’s essential to do your homework and consider your risk tolerance before diving in. Diversification is key; consider incorporating small caps alongside large-cap holdings to balance stability with growth potential. Happy investing! Subscribe to our   financial newsletter   for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

When considering an investment, the flashy ticker symbols and daily stock price movements might catch your attention. However, savvy investors often emphasize evaluating a company rather than just its stocks. But why is this so? And how can you do the same ? Delving Deeper Than Stock Prices As Peter and Frankie see it, imagine stocks as the shimmering surface of a lake. They reflect what's happening now . But what lies underneath, the health and vitality of the aquatic ecosystem, symbolizes the company . Here's why and how you should evaluate a company before investing: Cash Flow Why: A company's ability to generate positive cash flow consistently indicates its capacity to remain solvent and meet its obligations without external financing. It's the lifeblood of any business. How: Look at the Statement of Cash Flows in a company's annual report. Focus on operating cash flow , which shows how much money the business brings in from its core operations. Example: Tenaga Nasional Berhad has consistently posted positive operating cash flows which is a sign of its robust business operations. Gearing Ratio Why: This ratio measures a company's financial leverage , indicating the proportion of its operations funded by debt versus equity . How: A higher ratio could indicate higher risk (e.g.: the company being unable to repay their debt), but also potential for higher returns (e.g.: the company might be expanding) . Example: AirAsia had a high gearing ratio in the past due to its capital-intensive nature. So, investors had to determine if such debt levels were sustainable in the long run. Profit Margin Why: Profit margin reflects how efficiently a company can convert sales into profit . Typically, you’ll want to look for a business that maximises profit while minimizing costs. How: A higher margin suggests better efficiency and control over costs . You can also compare their margin with their peers to see if their performance is at par with industry standards. Example: Genting Malaysia Berhad, a diversified conglomerate, has different profit margins across its segments. Evaluating these margins can help investors understand which segments drive the company's profitability. Shareholder Activity Why: Significant buying or selling by top executives or major shareholders can be a strong indicator of a company's future prospects . How: Monitor announcements on Bursa Malaysia or news reports about significant shareholding changes. And if let’s say a major shareholder is suddenly selling the stock don't panic thinking that something could be going wrong. Instead, find out the true reasons for such transactions because it could be that the shareholder is selling their stake to another strategic investor that could bring the company to new heights. Example: If the founder of a leading tech start-up increases their stake in the company, it might be seen as a vote of confidence in the company's future. Macro Conditions Why: Companies don't operate in a vacuum. The overall economic and political landscape can significantly influence a company's performance. How: Keep track of key macroeconomic indicators , like GDP growth, inflation rate, or foreign exchange rates. Read up even more and stay in touch with major events and happenings that surround the company. Example: The Malaysian palm oil industry can be affected by international trade policies, currency fluctuations, and even environmental concerns. You’ll want to be aware of these if you’re investing in companies like Sime Darby or IOI Corporation. The Big Picture: Evaluate Both The Company and Stocks Investing isn't just about catching the next hot stock. In fact, we don’t have control over the stocks as the price is based on market forces. It's a careful, informed assessment of where a company stands and where it might go in the future. This is why, what we can do is evaluate how a company’s management controls and steers their business to create value for shareholders like you and me. And if the company is healthy, its share price will follow eventually. In short, don't just skim the surface. Dive deep. The health of the lake depends on it! RHB Small Cap Jewel Get exclusive access to Malaysia's top 20 high growth small-cap companies , curated by RHB Research. Sign up here  to grab your copy of RHB’s 20th Anniversary Small Cap Jewels. Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Earlier this month, the US Federal Reserve System (Fed) indicated that they will be cutting interest rates  throughout 2024. This created a euphoric sentiment in the market and that drove most asset classes up in price. So much so that even CNBC  said we can expect a ‘very bullish’ year for stocks in 2024! So, if you’ve been wanting to get into US stock investing, next year might just be the perfect time to do so! But are you wondering how  you can do this? Well, here’s a step-by-step guide on US stock market investing for Malaysians, including some of the platforms you can use. Step 1: Understanding the US Stock Market Before diving in, it's crucial to grasp the basics of the US stock market. It's home to the world's largest exchanges, like the New York Stock Exchange (NYSE) and NASDAQ, featuring a diverse range of established companies like Coca-Cola, IBM, Apple and Google. So, understanding the market's dynamics (including economic indicators, corporate earnings reports, political events, and more), key indices (such as the S&P 500 and Dow Jones), and trading hours (taking into account the time difference) is essential. Personally, when I’m trying to understand things like these, I’ll use the platform, Moo Moo .  This financial information app provides stock analysis tools, facts and reports on companies’ performance, real-time pricing as well as economic news that might affect the financial markets. Step 2: Choosing the Right Investment Platform As a Malaysian investor, your choice of platform is pivotal. Consider factors like ease of fund transfer, fees, and the range of available investment options. Preferably, you’ll want to look for platforms that offer access to US stocks, are user-friendly, and have reasonable fees. Popular choices include M+ Global  and Interactive Brokers .  Personally, I use M+ Global  because their trading app is very intuitive and easy to use. The features that they offer are also quite comprehensive including market overview, sector and top stocks performance, as well as the ability to create my own watchlist. For more details on M+ Global, check out the review I wrote here .  Step 3: Opening and Funding Your Account Once you've chosen a platform, the next step is to open an investment trading account. This process usually involves providing personal identification and financial information – typically, this includes your income source and investment experience. This step is not just a formality; it helps the platform tailor its services to your investment needs and provide appropriate guidance. Funding your account usually requires converting your MYR to USD, which can be done through the platform or your bank. It’s essential to be mindful of the exchange rates and transfer fees during this process.  Step 4: Research and Planning Before investing, it’s crucial for you to conduct thorough research and have a plan for your investments.  This research should include understanding the companies you're interested in, their financial health, market trends, and potential risks. This is where tools like financial news websites, investment apps, and market analysis can be invaluable.  Personally, the platform I use for this is a mixture of Moo Moo, M+ Global as well as Seeking Alpha . To me, Moo Moo provides the cold, hard facts when it comes to financial news; M+ Global is more towards understanding a company’s financial health, stock price and so on; Seeking Alpha, on the other hand, gives me insights from different perspectives. This is because Seeking Alpha  has a community of experts who will give their analysis and insights whether on the market or individual companies. It’s very opinionated and from that, I can understand the different points of view which will help me determine if a stock is one that aligns with my goals.  Step 5: Placing Your First Trade With your investment account funded and a plan in place, you're ready to make your first trade.  Start by navigating to the trading section of your platform. Here, you can search for stocks by ticker symbols (e.g., AAPL for Apple). Decide on the number of shares or the amount of money you wish to invest. You'll encounter options like 'market order' (buying at the current market price) or 'limit order' (setting a price you're willing to pay). Review and confirm your trade, and voila, you’re a US stock investor! Step 6: Monitoring Your Investments Investing is not just about buying stocks; it's also about monitoring and reviewing them to ensure they still align with your investment goals.  You’ll want to do this by keeping track of your investments’ performance and the overall market.  Staying informed about relevant news and being prepared to adjust your strategy if needed is also something you should be ready for.  Should You Invest In The US Stock Market From Malaysia? Investing in the US stock market from Malaysia is a viable and potentially lucrative option, especially with the anticipated bullish market in 2024.  However, it requires careful planning, research, and the use of the right tools and platforms. As an investor, it’s vital to stay informed, be adaptable, and continuously assess whether your investments align with your financial objectives.  With the right approach and resources, Malaysian investors can effectively navigate the US stock market and capitalize on its opportunities. Subscribe to our financial newsletter  for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

If you’ve been staying up to date with the investment news, you've probably caught wind of something called "halving." In the world of Bitcoin, this event holds significant importance for many, as they believe it's the driving force behind Bitcoin's ongoing price surge. However, not everyone is convinced, with some dismissing it as more of a marketing gimmick.  The halving event recently occurred on April 19, 2024, coinciding with Bitcoin's price at $69,736.75.  But what exactly is Bitcoin halving, and why does it matter? In this article, we'll explore the ins and outs of Bitcoin halving, its significance, and how it impacts Bitcoin prices. What is Bitcoin Halving? Bitcoin halving is the automatic reduction in the supply of bitcoin every four years. What this means for you is that the number of new bitcoins entering circulation gets cut in half. Imagine if you were collecting rare coins, and suddenly, the mint started producing only half as many coins as before. Naturally, this scarcity would make your existing coins more valuable over time. Similarly, bitcoin halving is designed to create scarcity in the cryptocurrency market, driving up demand and potentially increasing the value of existing bitcoins. Initially, when Bitcoin mining started, miners were rewarded with 50 BTC for each block they successfully mined. The rewards are then halved every four years: 28 November 2012: Reduced to 25 bitcoins 9 July 2016: Reduced to 12.5 bitcoins 11 May 2020: Reduced to 6.25 bitcoins 19 April 2024: Reduced to 3.125 bitcoins What is Bitcoin Mining? Bitcoin mining  is a process where specialised computers called ASICs (Application-Specific Integrated Circuit Miner)  compete to solve a complex mathematical problem. The first miner to find the solution gets to add the next block of transactions to the blockchain and is rewarded with newly issued bitcoin and transaction fees. While there's an element of chance, miners use powerful hardware to solve the problem faster, not just random guessing. This constant competition incentivizes miners to invest in even more powerful machines, which increases the overall computing power of the network, known as hashrate . The high hashrate makes tampering with the Bitcoin network incredibly difficult because it would require a massive amount of computing power. The Purpose of Bitcoin Halving Satoshi Nakamoto , the pseudonymous creator of Bitcoin, designed the cryptocurrency to have a fixed supply of 21 million coins. This reduction in block rewards serves two main purposes. Firstly, it ensures that the total supply of Bitcoin is limited. Secondly, it creates scarcity over time, which can potentially increase the value of Bitcoin due to the economic principle of supply and demand.  How Does Bitcoin Halving Work? Halving events are hard-wired into Bitcoin’s source code. Approximately every four years, the block rewards given to miners are cut in half. This process gradually decreases the total supply of Bitcoin, moving closer to the 21 million cap over time. The final Bitcoin is expected to be mined around the year 2140. How Will Bitcoin Halving Affect Bitcoin Prices? We’ve learned that halving reduces the supply of bitcoins, which in theory increases the price of bitcoin. Let’s take a brief look at the pattern of Bitcoin prices from previous halvings:  1. Bitcoin Halving on 28 November 2012  Reduced block reward from 50 BTC to 25 BTC . BTC price at start of halving: $12 BTC price 1 year later: $964 Percentage increase: 7985% 2. Bitcoin Halving on 9 July 2016 Reduced block reward from 25 BTC to 12.5 BTC . BTC price at start of halving: $663 BTC price 1 year later: $2550. Percentage increase: 301% 3. Bitcoin Halving on 11 May 2020 Reduced block reward from 12.5 BTC to 6.25 BTC. BTC price at start of halving: $8740 BTC price 1 year later: $58,250 Percentage increase: 540% (Please not that all price data was sourced from Coinmarketcap.com ) Based on previous cycles, Bitcoin prices tend to increase after each halving event. While past performance doesn't guarantee future results, many investors believe Bitcoin prices may rise following the latest halving. However, the impact is debated. While some believe the event is already priced in, historical surges and the concept of stock-to-flow ratio suggest otherwise. Predicting the exact rise is much like guessing how high a rocket will fly - difficult. This time, Bitcoin reached its highest price prior to the halving, adding another layer of uncertainty. In the end, Bitcoin remains a volatile asset with significant short-term price swings. The halving serves as a reminder for investors to approach with caution, weighing potential gains against inherent risks. What Happens When There Are No More Bitcoins? When all 21 million bitcoins are mined, no new bitcoins will be created. Miners will no longer receive new bitcoins as rewards and will only earn income from transaction fees . Even though no new bitcoins will be made, people will still be able to use bitcoin to buy and sell things. Instead of getting new bitcoins as a reward for mining, miners will earn money from the fees people pay to use bitcoin. So, if bitcoin is mainly used as something people keep to save money instead of using it every day to buy things, miners could still make money by charging higher fees for processing transactions. Special offer: If you're looking to start investing in cryptocurrencies, you can maximize your crypto investments with our exclusive offer. Use the code MMTVLM24 when you buy RM 250 worth of cryptocurrency on Luno , and you'll receive an additional RM 75 in BTC. It's a great way to boost your portfolio right from the start. Key Takeaways: Bitcoin halving is a programmed event that reduces miner rewards every four years, creating scarcity and potentially increasing Bitcoin's value in the long run. The halving can lead to short-term fluctuations in network hashrate as less efficient miners may be forced out. While past halvings have coincided with price increases, investors should exercise caution and due diligence. Disclaimer: Please note that this information isn't advice to buy or sell any financial products. Past performance doesn't guarantee future results, and we urge you to do your own research or seek professional guidance before making any investment decisions. Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

You're probably thinking: "There's no way RM100 will make a difference in my investment!" Well, you're not wrong. BUT, as the Malay saying goes, 'sedikit-sedikit, lama-lama menjadi bukit'. When you're investing with this relatively small amount, you have to think about the long-term. How can you make the most out of your investment? The answer is, through compounding returns. This is when your investment returns are reinvested, generating additional returns in subsequent periods. We've listed out some investments you can consider and categorised them according to low-risk to higher-risk investments. Pick and choose the ones that suit your risk tolerance the most! Let’s get started. Liquid and Low-Risk Investments StashAway Simple StashAway Simple is a cash management portfolio that offers competitive returns. Their returns range from 2.5% p.a. to 4.1% p.a. , depending on the market. Their app is very intuitive to use and everything can be done online including opening an account, depositing and withdrawing funds. Majority of your funds will be invested in a Money Market Fund and some of it will be in invested in cash. TNG GOinvest Similar to StashAway Simple, TNG GOinvest is Shariah-compliant and returns can go as high as 3.7% p.a. This investment would be very convenient since most of us already have the TNG app on our phones. You'll just to sign up for it and deposit a minimum of RM10 to start investing! ASB/ASM It's a government unit trust fund that has a fixed price of RM1 , making it a relatively safe investment. The dividends return is around 5-7% p.a. , which is relatively high for a low-risk investment. However, keep in mind that ASB is only for Bumiputera while ASM is available for all Malaysians depending on the units available. Higher Risk and More Volatile Stock Market I bet you saw this coming. If you're really looking to grow your money, there's no better place than the stock market. Locally, you can invest in Bursa Malaysia where the minimum units you'll have to buy is 100. So, if you're able to find a stock that costs RM1 or lesser, you'll be able to invest in the stock market with RM100! Returns can vary depending on the volatility of the market but historically, active traders can earn up to 10% p.a. If Malaysian stocks aren't your thing, you can also invest in the US stock market. We recommend using Interactive Brokers to do your trading because of their low fees and broad access to a variety of US assets. Cryptocurrency Alternatively, you could also invest in cryptocurrency which is a decentralised currency. It is said to have a lot of potential in the future. While it's possible to earn high returns , it's also possible to lose everything because it’s still considered a risky investment. So, stick to large-cap crypto like Bitcoin and Ethereum . Some platforms you can use to invest in crypto are Luno and Tokenize Xchange . If you buy RM250 worth of any cryptocurrency on Luno , you'll get an additional RM75 in BTC. Use the code: MMTVLN24 to claim your free BTC! As for Tokenize , you'll not only be able to buy cryptocurrency but you'll be able to earn and stake your coins for even more returns! If you click on this and use the code: MMTV1 , you'll be able to get free RM25 deposited into your account! MyTHEO MyTHEO is a robo-advisor that invests in a variety of assets. Their algorithm will pick and select assets for you to invest in based on your risk tolerance. Their portfolio invests in over 20 ETFs which makes them one of the most diverse robo-advisor in Malaysia. Returns average at > 4% p.a. , depending on market conditions and your risk-tolerance. StashAway Similar to MyTHEO, StashAway is also a robo-advisor that manages your portfolio for you. You get to choose from a variety of investment plans like general investing, responsible investing, thematic investing, or goal-based investing depending on the kind of investment you want to do. Alternatively, you can also customise your portfolio if you want to be more hands-on with your investment. We would suggest you to invest on a regular basis, using dollar cost averaging to even out your loss and gains. Unit Trust Unit trusts are managed by fund managers who will pick and select individual stocks to invest in on your behalf. There are many different types of funds available in the market, so it's important to research and get an idea of the fund's focus. Conclusion Having RM100 every month to spare is a good way to start experimenting with investing and build your savings. And with the right plan, you can make your money work for you and achieve your financial goals. Do you have more than RM100 to invest? Maybe RM500? RM1,000? Well, you're in luck! We made a video about it on our YouTube channel where we talked about how you can invest strategically with a larger sum of money! Disclaimer: This is not an investment advice. All content produced are solely for education and entertainment purposes only. Please consult your financial advisor before making any investment decision.

KWSP has introduced a New Account named Akaun Fleksibel for Malaysians and it is free to withdraw anytime. Since the implementation of the Account Flexible in May 2024, RM2.93 million EPF members below the age of 55 have withdrawn an average of RM2,382. But, the big question is, how does this affect us as EPF members? Whether you have withdrawn or not, in this article we'll do a breakdown of what EPF is and the new EPF structure. What is EPF? Let's start with a little background on EPF. As many of you already know, EPF is a mandatory saving scheme for retirement in Malaysia. It was set up by the Malaysian government to ensure Malaysians have enough savings by the time they retire. I believe that without EPF, many Malaysians would retire poor. The key reason why EPF is effective is that it’s mandatory. You have to contribute to EPF even if you don’t want to. Based on its structure, you can’t simply withdraw money from your own EPF account either. As an employee, you contribute 11% of your salary into your EPF account, and your employer tops it up with another 12%. This money is kept there until you reach the age of 55, at which point you can withdraw from Account 1. So, technically, it forces you to save and at the same time, you can’t access it until you retire.  EPF Account Structure Before we dive into the new structure, let’s discuss the traditional structure. Previously, EPF had two accounts: Account 1 (Retirement Savings):  70% contribution, locked until age 55. Account 2 (Flexible Withdrawal):  30% contribution, for specific purposes like education or housing. What Caused the Need for EPF Account 3?  When the COVID pandemic hit, many people were laid off, businesses were forced to close down, and people struggled financially. In order to curb the situation, the government allowed a one-off withdrawal from EPF to help those affected. Eventually, this one-off withdrawal happened multiple times to continue helping many who were financially struggling but it also increased the demand for flexibility in accessing EPF funds. According to an EPF survey, 83% of public consultation feedback preferred empowerment through flexible withdrawal. With that, EPF decided to introduce a new structure. With the new structure, an additional Account 3, known as Account Flexible, allows you to withdraw money as and when you need it.  Following that, the initial accounts were renamed along with their allocations: Account Persaraan:  75% contribution (increased from 70%). Account Sejahtera:  15% contribution (previously Account 2). Account Flexible:  10% contribution (new account, allows for any-time withdrawal). Benefits and Concerns of New EPF Structure This new structure empowers EPF members with the flexibility to plan their finances better. Members can access a certain amount of savings in their EPF anytime they need or want and turn it into an emergency savings fund. On the other hand, there are some who are concerned that this might lead to irresponsible withdrawals and leave people with inadequate retirement savings. EPF's strategy to mitigate this is to increase the allocation to Account Pasaran by 5% , safeguarding retirement savings while allowing flexible access to some funds. EPF CEO, Mr. Ahmed Zulam, is confident that the impact of this new structure is manageable.   They expect withdrawals to be between RM20 billion to RM30 billion this year, with a RM4 to RM5 billion annual withdrawal from then on. Compared to 2020 and 2021, these numbers are lower, and EPF has managed funds well even with higher withdrawals in the past. Contributions are also looking good, with a 15% increase in 2023 to 97.56 billion ringgit and a projected net inflow of 50 billion ringgit. So, more money is coming in than going out, ensuring the stability of EPF funds. There is also a misconception going around that Account Flexible has a lower dividend rate. This is not all true. All three EPF accounts receive the same dividend rate of 2.5% .  Should you withdraw from your Account Flexible? Some might want to withdraw money to buy things, which is generally not advisable unless absolutely necessary. EPF is effective because it protects your money against impulsive spending. Many people lack self-discipline with finances, and EPF acts as a safety net for retirement. However, if you still feel like withdrawing to invest elsewhere for better returns, the choice is yours. Just be cautious, as many retirees have lost their savings to scams promising better returns. EPF pays the same dividend rate for all three accounts, so the idea that Account Flexible has a lower rate is a misconception. For more information about EPF, please visit KWSP’s official website . If you still need to withdraw money, you can make an initial transfer to Account Flexible between May 12th, 2024, and August 31st, 2024 . After that, 10% is allocated monthly to this account. The Bottom line Overall, I think the new structure is beneficial as it provides flexibility while increasing retirement contributions in Account Pasaran. EPF has a strong track record, so I am not worried about its performance or dividends. What do you think about this new structure? Share your thoughts in the comments below. Check out my video on EPF Akaun 3 where I share another bigger issue that will affect Malaysians in the future.  Disclaimer:  This information is for general knowledge only and does not constitute financial advice. Subscribe to our   financial newsletter  for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Let me be real with you. I used to be the king of falling for the "cheap deal" illusion. Those bargain-basement buys felt like wins at first, but they always ended up costing me more in the long run. Take earphones, for instance. AirPods seemed like an extravagant splurge, so I bought a pair for RM70, then another for RM90. Guess what? Both started malfunctioning within months. The final straw was a knock-off pair of AirPods for RM300. Then, my wife surprised me with the real deal. Instantly, I noticed the difference - seamless connectivity, superb audio quality, and reliability. The original AirPods not only lasted longer but also provided a hassle-free experience. Initially, I thought I was saving money, but in reality, I ended up wasting more. Not only did I spend unnecessarily on cheap products, but I also wasted time and energy dealing with the constant malfunctions. The added frustration from frequent issues and the hassle of replacing them amounted to more than just the initial cost difference.  Which brings me to my topic today. Pro investors are adept at allocating their funds in the right places. They make strategic, informed decisions for long-term gains. We can use that same logic when it comes to spending our money. In this article, I’ll give you a brief breakdown of how you can spend your money like a professional investor.  1. Research Before You Buy In today’s digital era, buying a new item is easy. Anything can be bought at the click of a button. However, it’s still important to do your research before you hit “buy” on the first deal you see. "An investment in knowledge pays the best interest." — Benjamin Franklin Treat every purchase like a mini-investment. Do some research on the product you want to buy.  Read reviews, compare your options, and don't be afraid to look somewhere else for better deals.  2. Prioritise Quality Over Immediate Savings Don't be fooled by the siren song of "cheap." Seek out long-term value. To do this, you’ll need to look beyond the price. Consider the potential returns, such as the experience you’d get from the purchase. For instance, investing in a quality laptop for work or studies may seem expensive initially, but it will save you from frequent repairs and replacements, ultimately providing better performance and durability.  As Warren Buffett famously said, “It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.” This principle applies to everything, from gadgets to investments. Trust me, you’ll save yourself a lot of frustration and get your value for money in the long run. 3. Avoid the Temptation of Overspending While it’s important to prioritise quality over quantity, I’d say that it’s still important for you to remember to stay within your means. Avoid the temptation to overspend or accumulate debt. "If there is one common theme to the vast range of the world’s financial crises, it is that excessive debt accumulation, whether by the government, banks, corporations, or consumers, often poses greater systemic risks than it seems during a boom." — Carmen Reinhart Taking out a loan for a branded car is a recipe for disaster. Only purchase what you can afford comfortably without jeopardising your financial stability.  The Bottom Line Spending wisely is not just about saving money - it’s about making informed decisions that enhance your overall quality of life and financial well-being. By treating your expenditures like investments, you can ensure that your money is working for you, not against you. Just as pro investors aim for long-term gains, by following these steps, you too can achieve lasting value from your purchases and maintain a disciplined approach to your spending habits. Whether it's buying a reliable gadget, investing in education, or simply choosing durable products, these decisions will pay dividends in the form of reduced stress, fewer replacements, and a more satisfying overall experience. In the end, it’s about achieving a balance between cost and quality to ensure that each ringgit spent adds value to your quality of life. So, the next time you’re tempted by a hard-to-resist deal, remember to approach it like a pro investor. Your bank account will thank you. Subscribe to our   financial newsletter  for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Flipping on your gas stove to cook dinner seems like a simple everyday task. This simple act is fuelled by Malaysia's thriving oil and gas industry, which has powered many homes and driven the economy for decades. As the second-largest oil producer in Southeast Asia, Malaysia is set to reach an impressive 679.38 thousand barrels per day in 2024 . However, with the world moving towards a more sustainable future, the Malaysian oil and gas industry faces significant challenges in adapting to greener energy sources . This article dives into the challenges and opportunities Malaysian oil and gas companies face as they navigate a shift towards a more sustainable future. Challenges Faced by Malaysia’s Oil & Gas Industry Energy Transition and Sustainability Netherlands-based PFZW, one of the largest pension funds in Europe, has exited its investment in over 300 fossil fuel companies , including giants like Shell, BP, and TotalEnergies, due to insufficient decarbonisation plans. The global push for greener energy is placing immense pressure on traditional oil and gas companies. With the increasing adoption of renewable energy sources, there's a growing expectation for the industry to reduce its carbon footprint. This shift underscores the significant challenge for Malaysian oil and gas companies, as they must balance sustainability with profitability while meeting stringent environmental expectations. Economic Pressures Economic pressures are another major challenge. Maintaining a strong balance sheet while navigating fluctuating oil prices and market conditions is crucial for survival. A prime example is national oil giant Petronas, which saw its full-year profit in 2023 drop by 21% compared to 2022 . This decline can be attributed to a significant decrease in energy prices. Petronas' CEO even warned of potential volatility in the remaining year, highlighting the uncertainty faced by the industry. Cost of Technological Advancements Beyond price fluctuations, companies also face the high upfront cost of transitioning to renewable energy infrastructure. This includes innovations in drilling techniques, data analytics, and emissions reduction technologies. Last year, Petronas estimated that by the end of 2023, clean energy investments were expected to reach USD 1.7 trillion, surpassing those in fossil fuels . Balancing these financial hurdles while navigating towards a greener future is a key challenge for Malaysian oil and gas companies. Keeping up with technological advancements is another important role for the oil and gas industry. As the sector evolves, companies must invest in new technologies to improve efficiency, reduce costs, and meet environmental regulations. Deleum Berhad’s Strategy in the Oil & Gas Landscape Deleum Berhad  stands out in the Malaysian oil and gas industry due to its solid financial background. The company holds a strong balance sheet, which allows them to invest and pursue strategic growth opportunities. In our recent podcast, CEO Ramanrao Bin Abdullah  attributes this financial health to the company’s cautious yet forward-thinking approach. Growth in the oil and gas industry increasingly ties to technological advancement. Deleum Berhad invests in cutting-edge technologies that enhance efficiency and sustainability. Under the leadership of Ramanrao Bin Abdullah, Deleum focuses on innovations that reduce emissions and improve operational effectiveness. Deleum Berhad aims for regional expansion beyond its strong position in Malaysia. The company explores acquisitions in Indonesia and Thailand to broaden its market presence. By targeting companies facing financial difficulties, Deleum leverages its strong balance sheet to drive growth while maintaining financial prudence. Conclusion: Navigating the Future of Malaysian Oil & Gas The Malaysian oil and gas industry stands at a crossroads, facing significant challenges from global sustainability trends and economic pressures. However, companies that adapt to these changes position themselves to thrive in the evolving landscape. To gain deeper insights into Deleum and other small-cap stocks, check out the   RHB Small Cap Jewel e-book . Watch our full interview with Deleum Berhad's CEO, Ramanrao Bin Abdullah, on   The FAQ Show podcast . Subscribe to our financial newsletter for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

No one ever wakes up in the morning and anticipates getting into an accident in the afternoon. That’s why it’s called an ‘accident’. You’ll never know when you’ll end up in an emergency such as a punctured tyre, a car breakdown, or even getting sick that month. Like it or not, unfortunate events like these are inevitable, and that means you’ll have to skip out on a few yum-cha sessions with your friends and it may even knock you into unexpected debt. That’s why you need an emergency fund. An emergency fund is supposed to act as your financial safety net to cover unexpected expenses. In this article, I’ll explain to you why you need an emergency fund and how you can get started on building one. What is an emergency fund? An emergency fund is a sum of money that is set aside to pay for unexpected expenses such as unforeseen car repairs, medical expenses, or unemployment. In Malaysia, the Employees Provident Fund (EPF)  suggests that you aim to save three to six months worth of your salary as an emergency fund . Depending on your financial responsibilities, you could save more.  Why You Need an Emergency Fund 1. It Gives You Financial Security An emergency fund provides a buffer between you and financial disaster. Whether it’s a sudden job loss, medical emergency, or major car repair, having a stash for times of need can prevent these events from becoming financial crises.  2. Reduces Your Financial Stress Knowing that you have money set aside for emergencies can significantly reduce stress. Life is unpredictable, but having an emergency fund can help you sleep better at night, knowing you're prepared for a rainy day makes a world of difference in your financial journey. 3. Prevents You from Going into Debt Without an emergency fund, you might end up relying on credit cards or loans to cover unexpected expenses. Eventually, this could lead to high-interest debt, making your financial situation even more challenging. An emergency fund protects you from falling into this debt trap. 4. You Won’t Need to Rely on Others Having an emergency fund means you won’t have to be financially reliant on others in times of crisis. You won’t need to borrow from friends, family, or financial institutions, which can help maintain your independence and financial health. How to Start an Emergency Fund 1. Set a Goal First, figure out how much you need to save. You can start by using a budget planning spreadsheet  to calculate your monthly expenses. Make sure to include your rent or mortgage, utilities, groceries, and any other necessities, and multiply by the number of months you want to cover. You can check out this video  we made on how to use a budget spreadsheet. 2. Keep Your Funds in a Separate Account Next, you’ll want to keep your emergency fund separate from your regular checking or savings account. Much like the concept of "out of sight, out of mind," the goal of this is to keep you from succumbing to the temptation to spend the money on non-emergency expenses. A smart way to store your money is in low-risk, highly liquid investments such as money market funds  like TNG Go+, StashAway Simple, or Versa Cash . These offer daily returns to help your emergency fund grow over time. 3. Start Small and Be consistent If the idea of saving several months’ worth of expenses seems daunting, start small. Instead, set a realistic initial goal, like RM1000, and gradually increase your contributions as your budget allows. Reaching your savings milestones will give you a positive boost of momentum and keep you on track with your savings.  Set up automatic transfers from your main account to your emergency fund. This way, you’re consistently saving without having to think about it. 4. Use Windfalls Wisely Unexpected windfalls like tax refunds, bonuses, or gifts can provide a substantial boost to your emergency fund. Rather than spending them impulsively, prioritise depositing these funds directly into your emergency savings to strengthen your financial safety net. 5. Review and Adjust Your Contributions Periodically review your emergency fund to make sure it’s still sufficient for your needs. As your life circumstances change—like getting a raise, moving, or starting a family—you may need to adjust your savings goal. Eventually, when you’ve saved up enough, you can start redirecting your cash into investments .  6. Maintain Your Emergency Fund Maintaining a healthy emergency fund is a cornerstone of sound financial planning. Remember that your emergency fund should only be for real emergencies and not for “emergencies” like buying a new phone or going on an unplanned trip. It’s also a good habit to always replenish what you use. If you do need to dip into your emergency fund, make it a priority to replenish what you used as soon as possible. This will ensure that you’re prepared for any future emergencies. Conclusion Starting and maintaining an emergency fund might seem challenging at first, but when you start setting attainable milestones, it’s a lot easier to follow through so you can build a solid financial safety net for yourself. While you can’t predict the future, you can definitely prepare yourself for it. By taking the necessary steps to build an emergency fund, you’re also investing in your peace of mind. So start small, and stay consistent, and you’ll be ready for whatever life throws your way.  Subscribe to our   financial newsletter  for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Uh-oh! The World Bank has released a report  saying that Malaysian students are not learning as much as they should. Despite lots of money being spent on the Malaysian Education System , Malaysian students are lagging behind in their studies. If we compare our country’s education system with Vietnam’s, Vietnamese students receive 10.7 years of learning within a 12.9 year schooling period, while Malaysian students spend 12.5 years in school, but the years of learning only add up to 8.9 years. Education plays a critical role in improving a country’s overall success, particularly amidst inflation and other economic challenges. Hence, we decided to look into key reasons why Vietnam’s education is doing its students justice. Here’s what we can learn from Vietnam: 1. Government Commitment In 2013, the Communist Party in Vietnam approved Resolution 29, a comprehensive education reform prioritising education in their socio-economic development plan. This reform focuses on stability and continuity, unlike Malaysia's frequently changing education policies, which hinder teachers' ability to adapt. 2. Focus on STEM and Teacher Training Vietnam places significant emphasis on STEM subjects and provides adequate training for teachers. They revamped their syllabus and ensured teachers are equipped with innovative teaching methods, leading to a 50% increase in STEM enrollment. In contrast, many Malaysian students aspire to become social media influencers rather than pursue STEM careers. 3. Teacher Assessment and Reward System Vietnamese teachers are regularly assessed based on student performance and are rewarded for their effectiveness. This system motivates teachers to ensure all students perform well, not just a few high achievers. 4. Teacher Workload Malaysian teachers face a heavy administrative workload, reducing their time for effective teaching and professional development. This centralised and top-down approach often leads to irrelevant and impractical training programs. 5. Preschool Education A weak preschool foundation in Malaysia exacerbates learning difficulties in primary school. Without compulsory and quality preschool education, many children start primary school unprepared, making it harder for them to catch up. I’ve made a video sharing my thoughts about this topic. Particularly on how our government can make improvements in our education system. Check out the full video  on our Youtube Channel !   Subscribe to our financial newsletter  for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

Ever dream of owning a part of your favorite yum-cha spot? IPOs allow you to do just that. IPOs, or Initial Public Offerings, give you the chance to become a part-owner of a growing company, like the popular cafe chain Oriental Kopi. Oriental Kopi has announced that their IPO is brewing . But before you take a sip, let's break down what you need to know as an investor about IPOs. What is an IPO? Ever wondered how companies like your favourite café chain go from local hangouts to big-time businesses? That's where IPOs come in. An IPO, or Initial Public Offering, is the first time a private company offers its shares to the public for purchase on a stock exchange. Companies use this as a way to raise money to expand their business. For example, Oriental Kopi is planning to list on the ACE Market of Bursa Malaysia for smaller companies. They’re planning to use the IPO money to expand their cafe’s across Malaysia, build a central kitchen, and expand their reach globally. This can be a recipe for future growth, which is why IPOs can be exciting for investors. What does this mean for investors? Investing in an IPO could potentially bring you two main types of returns: Better Share Price: Ideally, if the company keeps growing after the IPO, the share price could rise. This means you could potentially sell your shares for a profit later. However, keep in mind that the opposite can also happen, and the stock price might fall after the IPO, leading to a loss if you sell. Dividends:  Some companies pay dividends to their investors, which means you'll receive a share of the company's profits as a cash payout based on the number of shares you hold. However, not all companies pay dividends, and the amount can vary depending on how well the company is performing.  Considerations when investing in IPOs While the potential profit is exciting, as an investor, it’s important to remember that every investment comes with a risk. Here are a few things to consider before investing in an IPO.  New Player, New Risks Many IPOs involve young companies venturing into expansion. While this translates to high growth potential, it also means there's a greater chance of unforeseen challenges or a business model that might not work out. Research the company's business plan, its competitors, and the experience of the management team. Market Matters The stock exchange where the IPO is listed can influence the risk profile. Companies listed on the ACE Market, for example, tend to be younger and more growth-oriented, offering potentially higher returns but also carrying a higher risk factor compared to established companies on the Main Market. Be sure to make your investment decisions based on your risk appetite and investment goals. For instance, if you are not comfortable with high volatility, established companies on the Main Market might be a safer choice for you. (Learn more about the difference between the ACE Market vs. MAIN Market here.) Limited Track Record Since IPO companies are typically new to the public market, there's a lack of historical data on their stock performance. This makes it harder to predict how the stock price might behave after the IPO.   Wait for the full prospectus to analyze the company's financials. This document details the company's financials, future plans, and growth strategies. Having a closer look at these factors will help you understand the company’s potential. Valuation Uncertainty IPOs can be susceptible to the excitement of hype and trends, which can lead to overvaluation. This means you might be buying shares at a price that's higher than the company's actual worth. If the company doesn't meet expectations, the stock price could fall significantly. Compare the IPO price to the company's true value by looking at the earnings of similar companies. Liquidity Risk Newly listed IPO shares might not be very liquid, especially for companies on the ACE Market. This means it could be difficult to sell your shares quickly if you need to access your money. It’s best that you only invest in what you can afford to hold for a potentially long time. Lock-Up Period Some IPOs have lock-up periods where investors are restricted from selling their shares for a certain amount of time after the IPO. This can limit your flexibility in managing your investment. Remember to factor in lock-up periods in your investment strategy and adjust your timeline accordingly. Limited Information You might have limited access to all the information that the company's management does. This may put you at a disadvantage when wanting to make informed investment decisions. It’s always good to seek professional advice from a financial advisor to help you with your investment moves. Conclusion The bottom line: investing in an IPO is akin to trying a beverage at your favourite café. It could be a delightful surprise, but there's always a chance it might not be your cup of tea. Remember, investing should not be a mere shot in the dark; if you are, then you’re simply gambling. Always do your research before making any investment moves. Subscribe to our   financial newsletter   for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.

As we rely more on online services for banking and shopping, the risk of falling victim to a scam has never been higher. There has been an alarming surge in scam reports, with losses totaling RM203.33 million in the first quarter of this year  alone! Scammers have honed their tactics to be so sophisticated that even the tech-savvy can get caught off guard. In this article, we've compiled the most common scams in Malaysia so you can spot them and learn how to protect yourself. Popular Scams in Malaysia 1. EPF Scam The EPF scam often involves scammers impersonating EPF officials and notifying victims that withdrawals have been made from their EPF Account 3. The scammers anticipate that the victims will panic and call to stop the withdrawal. Once they have the victim on the line, they feed them more lies and ask for cash to process their requests. Another variant of the EPF scam involves sending false messages to victims, claiming that their EPF accounts will be blocked within 24 hours unless they contact a provided phone number. However, official messages from EPF will display a five-digit shortcode as sender identification (ID) and will never be sent from a personal phone number. Additionally, EPF has also reported syndicates that advertise their services on social media,  offering help to contributors to withdraw their EPF savings early in return for a fee. To convince their victims, they submit falsified documents to facilitate withdrawals. If you encounter these syndicates, do not engage with them. They charge exorbitant fees, and you could also get into legal trouble for falsifying your application. 2. Loan Scam Loan scams are another popular scam in Malaysia. Scammers pose as legitimate lenders, such as bank employees or agents, and contact potential victims via direct message, SMS, phone call, or even an ad on social media . To build trust and validate their “legitimacy,” scammers may go as far as sharing their “business card” or sending photographs of bank staff in their premises. They then request personal documents from the victim. Upon receiving these documents, scammers inform the victim that their loan application has been submitted for processing. This is also an opportunity to deceive victims into sharing sensitive banking details and confidential information. Next, scammers request upfront payments for various fees, such as advance deposits, insurance, and taxes, to be made into an individual or company account. The payments continue until the victim realises that they’ve been scammed. Signs of personal loan scams in Malaysia include offers of guaranteed approval without a credit check, requests for upfront payments, a lack of verifiable contact information, pressure to act immediately, and offers that seem too good to be true. The biggest giveaway here would be that legitimate financial institutions and banks would NEVER authorise 3rd party agents for loans. Before making any payment for upfront fees, check with the bank’s official website or call the contact centre for more information.  3. Macau Scam Macau scams are another prevalent scam in Malaysia. In Kuala Terengganu, a 47-year-old businesswoman lost over RM200,000 after she fell for a Macau scam.   The term “Macau scam” was coined as it is believed to have originated in Macau or that the first victims came from there. A Macau scam is a deceptive scheme where imposters impersonate law enforcement officials, government agencies, or banks to trick you into revealing personal information or transferring money. The scam starts with you receiving a phone call with a spoofed number from someone claiming to be from a trusted authority figure like officers from the Royal Malaysian Police (PDRM), Bank Negara Malaysia (BNM), the Malaysian Anti-Corruption Commission (SPRM), or other agencies. The scammer will create a sense of urgency or make you panic by making up stories about accusing you of a crime, such as money laundering or involvement in a criminal investigation. They'll pressure you to “clear your name” by transferring money to a secure account, which is actually a fraudulent account controlled by the scammers. If you encounter one of these phone calls, it’s best to hang up immediately. Authorised personnel won’t contact you about sensitive matters through unsolicited phone calls. 4. Love Scam a.k.a Catfishing Be careful of the strangers you meet online. An employee of a higher education institution was left penniless after losing RM500,000 in a love scam . The victim had made contact with a “foreign” man through a dating website. These scammers create fake profiles on legitimate dating websites to trick you into entering a romantic relationship.They start by building a strong connection with you before asking for financial help, claiming they need it for illness, injury, travel, or a family crisis. These scammers can invest months into building rapport with you before making their move. Red flags to look out for would be fast declarations of love, reluctance to video chat and of course, financial requests. Some ways to protect yourself would be to always do a reverse image search on profile pictures, and be cautious of online profiles that seem too perfect.  Be careful of the strangers you meet online. An employee of a higher education institution was left penniless after losing RM500,000 in a love scam. The victim had made contact with a “foreign” man through a dating website. These scammers create fake profiles on legitimate dating websites to trick you into entering a romantic relationship.They start by building a strong connection with you before asking for financial help, claiming they need it for illness, injury, travel, or a family crisis. These scammers can invest months into building rapport with you before making their move. Red flags to look out for would be fast declarations of love, reluctance to video chat and of course, financial requests. Some ways to protect yourself would be to always do a reverse image search on profile pictures, and be cautious of online profiles that seem too perfect. 5. Job Scam or Recruitment Scam Job scams involve fake online job ads posted on social media, untrusted job portals, and sometimes even LinkedIn . Victims may also be directly approached by scammers via direct message or Whatsapp. These scams typically involve simple jobs with high returns or work-from-home arrangements to attract unsuspecting job seekers. The scammers promise a job opportunity following an initial upfront payment to secure an interview, training course, software, security clearance, taxes or fees. A good rule of thumb to remember when it comes to job scams is, if it seems too good to be true, then it’s probably a scam. Another way to tell if the job is a scam is if you’ve never applied for the job or the job description seems vague or too short. You can also check the company’s legitimacy by looking for it’s official website. 6. Investment Scam An investment scam promises potential investors a lucrative, low-risk, and short-term investment opportunity. Scammers entice victims by offering not-to-be-missed high returns or guaranteed investments in shares, real estate, options, or foreign currency trading. Genuine investment schemes will not promise guaranteed returns, especially not immediately. Investment scams are often marketed through social media platforms like  Facebook  or direct messages like WhatsApp. They are typically not licensed under the Securities Commission or registered as market operators. To spot and prevent investment scams, be wary of offers that seem too good to be true. Always verify the legitimacy of the investment by checking for proper licensing and registration. Or better yet, consult with a trusted financial advisor and do thorough research before making any decisions. 7. Messaging Scam SMS-based scams have been increasing in Malaysia , and unfortunately, many people have fallen prey to them. The latest tactic used by scammers involves impersonating telecommunication companies. Victims are lured through SMS messages from their supposed telco providers with a link attached to redeem their “loyalty points.” The messages claim that the victim has been awarded reward points and must claim them before they expire. Victims who click on the link are forwarded to a site that asks for their online banking information and the OTP number sent from the bank. This information is then used by scammers to access the victim's bank account and steal their money. If you come across such messages, verify the legitimacy of the message by contacting your service provider directly through official channels. Never click on suspicious links or provide sensitive information through SMS. What to Do If You Suspect a Scam While scammers are convincing and persistent, it is important for us to remain vigilant and cautious. If you suspect a scam, remember to do these three things: Stop:  Don’t give out any personal information and certainly don’t make any transactions—even if it sounds like you’re speaking to someone in authority (police, bank, etc.). Scammers rely on you not spotting these warning signs. Think: If your gut makes you suspect something is “off,” don’t ignore it. Ask yourself, “Could this be fake?” Don’t click links in messages, emails, or even on social media posts. Verify the legitimacy of the information from official websites or through secure apps. If you’re on the phone, say no, hang up, and block the number. Protect: Act immediately. If you’ve noticed unusual activity or suspect a scammer has your information, notify your bank and seek help. Acting quickly will allow them to implement the necessary protocols to prevent further harm. What to Do If You've Already Fallen for a Scam If you’ve already fallen for a scam, take these steps immediately to minimize the damage: Keep All Records:  Keep all your records of financial transactions relevant to the interaction with the scammer. Take screenshots of your interactions with the scammer. Notify Your Bank:  Contact your bank immediately to inform them of the scam and take steps to secure your accounts. Notify NSRC:  Provide the National Scam Response Centre with the details of the scam. They can help in taking further action. Make a Police Report:  Report the scam to the police to ensure it is officially documented. Report to Bank Negara (if necessary):  If the scam involves financial institutions, make a second report to Bank Negara. Contact PDRM's Commercial Crime Investigation Department:  Lodge a report with their Scam Response Centre at 03-26101559 and 03-26101599. Report to MCMC:  Alternatively, you can report the scam via MCMC's website, email them at aduanskmm@mcmc.gov.my , or WhatsApp them at 016-220 6262.   Subscribe to our   financial newsletter  for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.