The Star: What To Do With Cool RM1mil Cash?

This article explores the question of what people would do if they had RM1 million in cash. Naturally, different people will provide different answers depending on their individual preferences, whether to save or spend or invest. 

Kimberly’s advice is to clear all your debts first and then build an emergency fund that can cover 24 months’ worth of expenses. Next is to invest your money: Kimberly suggests allocating “20%-30% in secured investments, 50%-70% in growth and the remaining 10% for speculative investments”. If you have the right expertise and time on your hands, you can invest directly in stocks; otherwise she recommends investing in unit trust funds. 

Kimberly also stresses on the importance of saving your money by cutting down on excessive and unnecessary spending. To build your investment portfolio, she explains that allocation of funds involves 2 methods: capital growth (suitable for those below 40 years old) and income generation (suitable for those closer to retirement age). She further adds that “the best annual return rate is normally a high single digit, around 7%-8%”, and that double digit return rates are impossible in the long run and extremely risky.

This article can be found here.