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#MoneyMatters: How To Survive on Fresh Grad Salary of RM2,500 in KL

by Melissa Ong. |

Crunch is partnering with Hey Alfred - the smartest financial assistant app powered by Ai to help you track all of your financial assets; to bring you this series.

In this series, we want to provide you with helpful information to gain better financial literacy. Through this journey, you will learn how to manage your money better, save more and secure your finances for the future. If you often find yourself clueless on money matters like paying your first income tax, applying for loans or even how to save more without feeling miserable, this series is just for you.

We got your back. It’s time to take control of your #MoneyMatters.

One of the hottest topics in Malaysian society today is financial management. It is not unusual to see a fellow Malaysian scratching their head, wondering how to save money at the end of every month—especially if they’re on a fresh graduate salary of RM2,500. With the number of bills to pay and necessities to acquire, this can seem daunting at first!

And it certainly isn’t easy, but with time, practice and some trial and error on a fresh grad’s part, these challenges can be overcome.

If you’re wondering, “Why even bother? As long as I can survive every month, it’s fine”, it’s because no matter who you are or where you come from, it is essential to learn financial management. This is to ensure a more comfortable future and retirement, one where you needn’t worry about making ends meet every month.

Thus, you can’t rely on just EPF or pension alone!

So what can one do to ensure there’s money left over every month? It’ll be tough, but here are some things that can be done:

1. Living within your means

What does it mean to “live within your means”? It means if are you are able to, cut-out/down the non-essentials from your life. This includes stuff like Spotify, Netflix, a gym membership, weekend outings with your pals, and if you absolutely can do without it, a car. Yes, a car. If you’re able to take the train to work instead, do that. You’ll save a lot on petrol, tolls, parking, maintenance and repairs. If you really do need a car, find other aspects of your life to trim away instead.

Or you can get creative! You’d be surprised by how something as simple as only drinking water can save you in the long run. Find a plan that works for you, and aim to save 20% of your salary after tax.

2. Create a budget

Once you’ve decided on the stuff that you can do without, it’s time to create a budget. After-tax, allocate money for your bills, necessities, savings and if you can afford it, wants. Your budget can look something like this: 50% bills, 30% necessities and 20% savings, thus 50/30/20. Or if you’d like to simplify it further, make it 80/20.

Draw up a list of all the things that you need to pay like your monthly bills; so you’d have a clearer idea of your monthly spending. After a month of trying your new budget, review and readjust your budget accordingly.

3. Plan for the future

Sure, it might seem like a pain now, but consider getting insurance. You won't exactly save immediately for this but in the long run, you will. After all, life is unpredictable. We can certainly plan and plan and plan our budgets as much as we’d like, but if something serious like a car accident or a medical emergency happens and you do not have insurance, you’re in trouble. Parting with some money now can save you from taking a major financial hit in the future.

4. Automate your savings

Fun fact: People who automate their savings save more than people who do not. This is because the money that could’ve been spent—has already been put into savings. What’s more, you can do this for your bills and loans as well. Just imagine what the following scenarios would feel like:

  • Waking up and knowing that your bills have already been paid.

  • Your money is already going into where it should be going—your savings account.

  • And if you have some money left over? You can spend it without worry!

  • Oh, the extra bonus of not having to suffer through traffic because you don’t have to take care of any of these things.

That’s a lot of time saved! The time that could be used for leisure or even making more money.

5. Look for high-interest savings accounts

Want to get more money in the long-run? Then looking for high-interest savings accounts is the right move. It will take a bit longer, but with high-interest savings accounts, you can look forward to having some extra money every year. It may not be much at first, but as your savings grows, so will the amount you get from interest. It is a nice little incentive to save every month.

And if you keep it up, you’ll be able to use that extra money for a rainy day, big purchases or even a holiday treat! Just maintain that willpower and you’ll get there.

To get the biggest bang out of your buck, compare savings accounts using sites like iMoney or RinggitPlus.

6. Invest with a Fixed Deposit

If you have extra money that you can leave untouched for a while, look into investing with fixed deposits. What is a fixed deposit, you ask? A fixed deposit is a type of savings account that offers a fixed rate of interest in return for not withdrawing any money for a certain amount of time. In contrast to other types of savings accounts, interest is only paid at the end of the investment period.

You can also look at iMoney and or RinggitPlus to make comparisons. Note that a good interest rate is 3-4%.

There you have it, a list of things you can do to survive on an RM2,500 salary. It’ll be a tough road ahead, but the rewards will be great—so save, save, save! A better future lies ahead.

You may find out more about Melissa on her Instagram too.

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