PETALING JAYA: Education is the cornerstone for financial planning, especially with rise of fintech that offers more new financial instruments, said Financial Planning Association of Malaysia (FPAM) CEO Linnet Lee (pix).
She observed that the young investors are more open to financial tools such as equity crowdfunding and peer-to-peer lending.
However, she stressed that like any other instruments, prospective investors should know what they are in for and be aware of the risk involved.
In an interview with SunBiz recently, Lee said financial planning is one of the tools to keep an individual more informed in investing.
“Part of financial planning is setting the goals for an investment, assessing how much has a person put aside to reach that goal and how much more is needed to achieve those goals as well as the risk they’re willing to take.”
“In turn, this will determine what kind of investments that a person should make.”
Lee highlighted that financial planning is about managing finances, balancing between income and expenses and coping with leakages stemming from debts and loans.
Apart from that, she pointed out that a person should also leverage on his/her tax rebate to generate extra savings which could translate into more investments.
When it comes to investing, she said the investors should exercise caution by checking the regulatory bodies’ watch lists, including Bank Negara Malaysia and the Securities Commission Malaysia as well as the respective regulators in which the investment originates from.
Despite the current low-yield market environment, Lee sees opportunities in the equity market.
“For those who has the money, intention and the time frame to invest, this is the right time as what goes down will come up, although this might not be suitable for those looking to cash out within one or two years.”
She shared that she’s not worried if there is another recession, as it would be her third boom-bust cycle.
Lee stressed the importance for the people to have a rainy day fund for emergencies to avoid dipping into their investments.
The SC is hosting its investor education fair “InvestSmart Fest 2019” this Friday to Sunday at the Mid Valley Exhibition Centre, Kuala Lumpur. The public can sign up for free financial planning assessments at the #FinPlan4U booth.
