Saturday, June 03, 2017

How To Play Money Game?

When I backed to Malaysia last month, I heard a lot about this "Money Game" term which I've never heard before in the past. I don't think that is an official financial term but that is probably only used in Malaysia (maybe Singapore and China too?) In short, money game is basically a high investment return scheme. In other words, it is known as "Get-Rich-Quick" scheme which is a more proper term. For example, you invest certain amount of money, you can get back 20% of return every month.

What so sad is many are believing money game is actually real and claim that the founder is a genius. We can't blame them because there are actually physical proper office which makes people think they're real? We are not talking about 1 or 2 money game companies but more than 300 of them listed by our Bank Negera Malaysia (BNM) as illegal investment company. Sometimes I just curious, if BNM already know they're illegal, why no actions being taken? Could this be political related?

Good news is these money game companies start getting main media attention recently. Many people have started to aware those schemes are basically not real but in fact is merely a fraud based on the pyramid scheme especially they start not getting back their money. Maybe this is just my hope but in reality, perhaps the awareness of the truth of money game is still at very low level in Malaysia. It seems like this is something that can't be fixed because I have been hearing this since I was a kid!

Well since this is unfixable (although deep in my heart I really hope this can be fixed), I think I may as well teach you how to play this game. At least, I can share with you from my perspective how I will I play this game if I really want to. Here are the only 3 simple rules that I come up which I think you must follow them if you're serious in money game.

Rule 1: Understand Money Game is A Scam

The best investor in this world can only make 20-30% return annually. What make you think this company can make 20% a month for you? Yupe, that is why he is a genius. He makes probably 40% a month and give you 20%. This number basically way too off from the reality. If you can't accept this is scam, this money game is NOT for you.

Rule 2: Invest Like Giving A Donation

You have to imagine like giving a donation. It is basically something that you won't get back. If you don't get back the money, it is fine. If you're okay to donate $1K, then invest $1K or else don't invest at all.

Rule 3: Make Sure The Company Has Lasted for 1 to 1.5 Years

Well this is just my guess. You need to do a little bit research, how long this company has lasted. If it has been just lasted for few months, don't invest. Lasting for more than 1.5 years, don't invest too. Only invest those companies that has lasted between 1 to 1.5 years and don't ask me how I come out with this number. This is purely my gut feeling based on very limited personal statistical data.

Rule 4: Do Not Top Up Your Investment

Make sure you don't top up additional investment. If you really want to invest more, look for another company that meets Rule 3 criteria above. Topping up basically defects the purpose of Rule 3.  Either you don't top up or look for another company if you really want to donate more.

Hope this post is useful to you. Last but not least, I highly recommend you to learn to be a real investor. Don't invest in this kind of no-effort high return investment. If you really want no-effort investment, just invest in Fixed Deposit or Mutual Fund using the dollar averaging strategy. Good luck!

Sunday, November 13, 2016

Everything Is Negotiable In Australia?

I learned that almost everything is negotiable in Australia and is this a good thing? I personally don't like it because it requires you do extra homework before you make a deal.

The trick is you need to "SHOP AROUND". What you really need to do is don't go to the shop you really want to make a deal with first, shop around to get the cheapest price and finally only go to that shop for final negotiation. This usually goes like this:

  • What is the cheapest you can give me? If the given price is cheaper than the cheapest price that you have in another shop, it is clearly you don't do enough homework (this usually won't happen).
  • Tell them that you get this price from another shop (show them the proof), what you can offer? If they offer the same price, ask them again if it is the same, why do I need to buy from you? Then, they will usually give you lower price again.
  • Ultimately if you repeat the above steps couple of times, then you will definitely get the cheapest offer.

Utility bill is the one I did it recently which I did not aware it all until I was told. Can you imagine utility bill also can be negotiated? The highest discount among all my friends is 18%. So I gave them a call and start negotiating. At the end, we got 23% discount but with condition of 1 year contract.

  • They first offered me 15%, then I told them that all my friends get 18% from another company, then they offered me 18% with a contract. 
  • I responded no. I don't want to tight to any contract with a discount. Then, the person in charge can't make the decision and need to escalate this to his/her manager. This is the crucial steps and make sure you go beyond this step. 
  • After the manager's approval, they offer me 23% discount with 1 year contract which then we had accepted the offer. I believe there was still room for negotiation but we didn't proceed it further (e.g. we can hang up and use this as baseline to negotiate again with another utility company) 

This is really applicable to also everything which includes electronic stuff, car insurance, car, home loan, utility bills, lawyer fees and etc. Can you imagine it is really almost everything? If you don't negotiate, they won't specifically offer you. Take the utility bill example above, I have saved 23% by just giving them a call.

I don't really like this system and it is simply waste of time. It doesn't have standardization too. However, if you really want to save, do your homework and remember to get the proof to support your negotiation. I guarantee that you will get a lot more cheaper price than normal people get because majority of people here don't negotiate. Good luck!

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