What is ASB FINANCING? ASB Financing VS ASB Saving 2020 скачать в хорошем качестве

What is ASB FINANCING? ASB Financing VS ASB Saving 2020

In this video, we go through ASB Financing and you can use it to build a RM1,000,000 retirement portfolio. Subscribe ➡ https://themillennialfinance.com/subs... Amanah Saham — one of the greatest investments for eligible Malaysians. But did you know about it’s younger, better sibling ASB financing? Unfortunately, some of you wouldn’t be able to participate in this and we really wish that wasn’t the case. For those of you who can, consider yourself fortunate! WHAT IS AMANAH SAHAM (1:05) All Amanah Saham funds (AS1M, ASB, ASB2,etc.) are managed by a fund manager named Permodalan Nasional Berhad (PNB). They were formed in 1978 as one of the instruments of the New Economic Policy. These funds were created to encourage a behaviour not many Malaysians participate in — investing. In order to do this, they decided to create fixed NAV funds that return yearly “dividends”. What this means is each unit in Amanah Saham Bumiputera is fixed at RM1. Essentially, you can’t lose money investing in ASB. With the launch of this product, banks came up with an idea. “What if we provided loans for Malaysians to invest in Amanah Saham, creating a win-win situation?” Thousands of the greatest minds as they brainstormed this concept and a product was born, ASB Financing. ASB Financing is a simple concept. Banks provide loans at a BR + x% rate (depending on bank) that will automatically be put into your Amanah Saham account as an investment in ASB. When you look at your ASNB account, there will be a split between your cash investments and loan certificate. I (Emir) have an ASB loan of RM100k. They split this amount to show you what portion of your account is available for withdrawal. The banks have agreements with ASNB that prevents you from withdrawing the loan amount of RM100k, meaning its sole purpose is as an investment in ASB. If I default on my monthly installments, the banks can withdraw this entire loan certificate from my account meaning they have zero risk in disbursing these loans. For as long as I continue paying my monthly installments, this RM100k will be in my ASB account generating returns for me over the long run. ASB FINANCING VS ASB SAVING (3:16) This entire concept of ASB Financing is called leveraged investing: borrowing money from others to invest. We don't usually recommend leverage investing since you can lose a lot of money very quickly. ASB is slightly different though. Since the funds are fixed at RM1/unit, we can’t lose money. So, we can utilize leverage to outsize our returns that couldn’t be achieved if we invested regularly. Let me give you a personal example of how this would work. I’ll work on the assumption of 6.5% ASB returns & 4.8% ASB Financing interest rates. This gives us a spread of 1.7%. I’ve decided to apportion RM530 of my monthly income to invest in ASB. After a year, I would have RM6,360 of invested capital and (Insert complex calculations here) RM224 returns from ASB. This brings me to a total of RM6,583. Very nice results for a year of saving! If I use the same RM530/month and decide to go the ASB financing route however, things get better. With that monthly installment amount, I get an ASB Financing agreement worth RM100k. This nets me RM6,500 in dividends. On top of this, I’ve paid off RM1.5k of my RM100k loan. This means that if I decide to terminate the contract, I would get the money deposited into my ASB. This brings my total returns to RM8,000, nearly 23% higher compared to standard ASB deposits. HOW TO USE ASB FINANCING First up, you need to see what your retirement timeline is. For me being 24 this year, I have 31 years till I become 55. Let’s make it 30 for simplicity sake. Over the next 30 years, I expect average ASB returns & ASB Financing interest rates of 6.5% & 4.8% respectively. These are pretty safe assumptions as although ASB returns were lower in 2019, interest rates have also fallen below the 4.8% mark. Next up, I take up an ASB Financing amount of RM150k. Note that the highest loan amount you can take is RM200k, so you can earn more if you’re willing to set more money aside every month. This leads to a monthly installment payment of roughly RM790, or RM9,500 . After 30 years, I’ve fully paid off my ASB loan and the net amount in my ASB is now…. RM992k. Without adding anymore funds, I’d be raking in RM65k per year in dividends alone. PROS OF ASB FINANCING (7:37) CONS OF ASB FINANCING (9:42) HOW TO GET STARTED WITH ASB FINANCING (13:32) Read the full article on: https://themillennialfinance.com/what... FOLLOW THE MILLENNIAL FINANCE: Instagram:   / themillennialfinance_   Facebook:   / themillenialfinance   Twitter:   / themillennialf_   Tell us in the comments if you liked this video and what other kinds of videos you would like to see. #TheMillennialFinance #ASBFinancing2020 #HowToInvestInMalaysia