Saturday, June 25, 2011

Worldwide House Price Trend (2006–2010)

This is the worldwide house prices trend in the past 5 years which includes USA, Japan, Britain, China, Australia, Singapore and Hong Kong. Too bad, there is no data for Malaysia but you can kind of guess that  Malaysia should be somewhere  below China and follow the similar uptrend like China. Let’s check it out the graph below:


The house price fell in USA was due to the subprime mortgage crisis in 2006. The house price drops by ~35% after this crisis and has never been recovered until today. By the way, this trend is also similar to Ireland which is not shown in this graph (I don’t want to make the graph too crowded) . As for Japan, the house price has never been recovered after the Japanese asset price bubble from 1986 to 1991. Surprisingly if you look at the house price trend in Britain, it was that badly affected by the subprime mortgage crisis if compare to USA. 

The house price for the rest of countries especially for Asia (except for Japan – i.e. China, Hong Kong, Singapore) and Australia, is moving uptrend. The slight downtrend in 2008 – 2009 was probably due to the stock market crash during that time.  After the stock market crash, investors start moving their target to real estate or property. That is probably the reason why you see the house price has been increasing dramatically after 2009 until today.

When is the next bubble burst?

You can kind of expected the house price in the western countries will probably stay flat in the coming years. But what really interesting here is the property market in Asia. Will it be keep going up or is it already at peak? Bloomberg reported Hong Kong is the world’s most expensive place to buy home. 65 million apartments in China are said to be empty creating “Ghost Cities”. Are these obvious enough to tell the property bubble is going to burst soon?

Well, I do not know but if you ask me about Malaysia, I think generally most of the investors in Malaysia have the strong holding power and this makes me think the property bubble bust is unlikely to happen in Malaysia. Could I be wrong? Another very interesting discussion is the property price in Penang and KL seems to have huge gap as compared to the other states or cities within Malaysia. Can the bubble burst only happen within certain states or cities (e.g. Penang and KL)?

So, what do you think? Do you think property bubble burst is forming in your country? What is the next trend?

Thursday, June 16, 2011

6 Debt Reduction Tips to Keep You in Sound Financial Health

Debt is a curse. The sooner you put in efforts to reduce the level of debts that you owe, the better it is for you. To reduce your debts substantially, the debt relief programs are of paramount importance. This is nothing but partial or total elimination of debt as well as stalling debt growth. Here is a list of some debt reduction strategies that you can follow to curb your debts significantly.

(1) Don't incur debts

In majority of the cases, you fall into debt because of your own imprudent financial behavior. Don't use your credit cards recklessly. Take out loans only to purchase home or car. Try to live within your means. In fact, if you can successfully limit your spending below your income, you will never fall into a debt situation.

(2) Create a realistic budget

It is very important to build up a realistic budget. You categorize your items of expenditures and then allocate money to each category. Make sure that you don’t spend beyond the amount allocated to each category. This will indeed be helpful to keep a lid on your spending behavior. Your budget should be such that you are able to contribute some money to the emergency fund. The emergency fund can be utilized to meet unintended expenses. 

(3) Be well aware of your liabilities

When you have fallen into debts, you have to be well aware of how much you owe to others. You should be well-acquainted with the monthly payments that you have to make, your interest payments as well as the outstanding balances. Don't default in making payments. Only regular payments on your debts can make you debt free.

(4) Close credit card accounts

It is not a wise financial behavior to keep many credit cards. And, if you already have many credit cards, it would be wise to close as many credit card accounts as possible. The underlying rationale to keep less number of credit cards is to curb the temptation to abruptly spend money using cards.

(5) Make more than minimum payments

Make efforts to pay more than your monthly payments. Use the additional amount of money to pay off your lowest outstanding debts. This helps you pay off your lowest outstanding debts even before the scheduled time period. And, once you have successfully paid off your lowest outstanding debts, switch your target to the next lowest outstanding debts. Persist with this process. This helps you clear off your entire debts in a relatively shorter period of time. 

(6) Seek professional help

Sometimes, it is a good ploy to seek professional help to repay your debts. A debt relief company can negotiate a pay off strategy for you after working with your creditors.

These are indeed smart tips that you can start following from today only. Seriously following these tips, will keep you in good financial condition.

This is a guest post by Nancy.

Sunday, June 12, 2011

Open for Guest Posts and Guidelines

I have been receiving many guest post requests in the past and recently getting even more guest post requests in the past few months. I truly appreciate for those of you who interested to write a guest post in my blog. At least this tells that my blog is worth for you to write. Thank you so much! Having said so, I would also like to apologize to you that until today I have NOT even done a single guest post. Sorry, guys!

I usually do not able to get back to you in a timely manner due to busyness of my schedule. I know this is an excuse. So this is my fault then, please forgive me. But I will still definitely get back to you later on with some delays and I usually throw you ton of questions. First, probably I”m new in this guest posting stuff so I have a lot of questions to ask. Second, I want to make sure that whatever you write will be useful to the readers of this blog. Third, I also want to make sure I don’t want to waste your time to write an article that eventually I do not post it here. At the end of the day, I usually do not get any respond from you after that. I guess I have make you pissed off already? Again, sorry if this is the case…

In order to reduce my questions to you, I thought it will be easier for me to come out the guidelines for guest posting in this blog:

[Updated: Feb 7, 2012]: Added perquisite guideline to raise the bar slightly higher to encourage the guest post author to be more interactive and also to encourage the blog commenters to do a guest post. 

[Updated: May 27, 2012]: Added content guideline that the link must be related to personal finance website.. I want ultimately the provided link is the useful one. Sorry for any inconvenient cause.

[Updated: April 29, 2013]: Updated for no link is allowed requirement. Yeah I know, this will turn away you. :)

Prerequisite Guideline

  1. You had posted at least 5 relevant comments in this blog. 

Content Guidelines
  1. Anyone can do guest post (e.g. readers of this blog, other bloggers and etc.)
  2. The post cannot be for advertising purpose and must be relevant to personal finance. The post should be focusing on providing useful personal finance tips to the readers.
  3. Your post must be original and has never been be published anywhere else which including your own blogs or other places.
  4. Your post does not need to be agree with my line of thinking. I love and enjoy to accept different points of view. 
  5. No link is allowed unless I know who you are (e.g. frequent readers of this blog). 
  6. Your guest post is preferable written in simple HTML format. If you would want to submit in DOC format, it is also fine but please avoid fancy stuff. :)
  7. If you have picture, please include your picture in your guest post submission and mark it clearly where the picture or image should be displayed in the content.

Submission Guidelines
  1. If you’re okay with all these guidelines above and still interested to do a guest post in my blog, please send your guest post to me at
  2. I will try to reply within 48 hours and tell you whether I will accept the guest post or not. I may have questions or requests to the guest post and once we get the consensus, I will post that up as soon as I can. If I reject your post (I hope I won’t), you’re obviously free to use it anywhere as you like.
  3. Once I posted your article, I will drop an email to you for you to review.
P/S: Hope I don’t turn you guys off! Have fun writing!

Sunday, June 05, 2011

High Pay with Low Stress or Growth?

A friend of mine resigned from his company last month. So, I asked him why and his answer was very stressful to work there, and he didn’t see a reason to reject since he got an offer with 30% increment and promotion. According to him, the new company (i.e. which is also his ex-company) is a lot more less stressful than the existing one. So the conversation continues:

Me: Are you doing a same job like what you did previously?
Friend A: Yupe. No difference and I know in-out of everything.
Me: Even with a promotion, will you still do the same thing like what you did last time?
Friend A: Kind of. I'm supposed to get a promotion previously but they didn’t give me. I can perform at that level. No problem for me at all.
Me: So, can I say you will be in comfort zone?
Friend A: Definitely. So lucky I am. Get a raise to do an easy job!
Me: What about personal growth? Will the new job help you to grow?
Friend A: Hmm…  Is that important? I don’t take that into my consideration. I will be stupid if I don’t take this offer for doing something easier and less stressful.
Me: Okay. You’re right. Good luck, man!
So, what do you think? Was my friend making a right decision? There 2 things to consider here:

First, you get a promotion with a same job scope before? Think about it carefully, why a company want to do this? It still makes sense assuming if you’ve already over-performed in a lower grade as what my friend told me.

Second, no growth versus money. Which one is the right thing to decide if you can only choose one? Well, this is not an easy decision especially when it comes to you. I bet most people will choose money and sacrifice growth like what my friend did. If you were my friend, what will you do?

If I were my friend…

I will make sure there is a growth for me before I take the new position. I will start discussing with the hiring manager the opportunity to growth. Keep in mind that doing a same job, doesn’t mean no growth. Assuming after the assessment, I find that there is no growth or no significant growth in this new job,  I will NOT take this offer! Ops. but with one exception, guess what? The exception is there is also no growth in my current or existing job.


One more thing is missing here before you consider to switch job is company stability. You don't want to join that no strong in fundamental. Anyway to make the discussion easier, let’s put aside this into the consideration
Well this is what I think. You should make decision based on the following criteria in priority order:
  1. High Pay, Low Stress, and High Growth (Ultimate goal, don’t you think so?)
  2. High Pay, High Stress, and High Growth (Okay, not that bad. Learning to manage stress is a skill.)
  3. Low Pay,  Low Stress, and High Growth (Eventually your growth will translate to money, don’t worry!)
  4. Low Pay, High Stress, and High Growth (Don’t worry again, money will come later.)
  5. High Pay, High Stress and Low Growth (Try to make use of your high stress to become your growth)
  6. High Pay, Low Stress and Low Growth (Yes, only if you really want to be in comfort zone!)
  7. Low Pay, Low Stress, and Low Growth (This should be your retirement strategy.)
  8. Low pay, High Stress, and Low Growth (Too obvious right? Please avoid this.)
Look at 3,4,5 and 6. Guess some of you may disagree with me?

P/S: Btw, guess what is the top 5 high-paying and low-stress jobs? That is Physical Therapist,  Computer Software Engineer, Civil Engineer, Massage Therapist, and Technical Writer (Provided by: Investopedia).

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