#OpsRaya: 3 Most Common Financial Mistakes Malaysians Are Guilty Of Every Raya

In a matter of weeks, Malaysians will mark the end of the fasting month and greet the Hari Raya festivities with the usual balik kampung sojourn.

It’s a time to catch up with family and friends, flash that baju raya and indulge in a hearty meal of lemangand rendang.

But it is also a time of heightened financial spending. Online sales are expected to surge upward by at least 50% throughout this year’s Raya month, according to digital marketplace 11street.my

Electronics, home gadgets and clothing are sought-after items while demand for car services and road safety-related items are expected to rise, it added.

Now, while we don’t mind a little splurging in the name of festivities, money is no respecter of times and seasons – you’ll just have to use it wisely.

Here are three things you should avoid doing this Raya at all costs:

1. Buying a new set of wheels

By this we don’t mean new tyres, which you should change if they are worn out or have past the expiry date.

For Malaysians a car is more than moving from Point A to Point B – it’s a status symbol. But there’s a more sobering reality: one of four bankruptcy cases in the country are due to the purchase of vehicles.

The Insolvency Department revealed that 27.94% or about 28,374 bankruptcy cases between 2011 and 2015 fell into this category.

Now we know that purchasing a car in Malaysia is easy: all you need is some basic documentation, a low down payment and approved hire purchase loan.

Heck, these days there are many financing programmes empowering consumers to own an upmarket auto through a seemingly reasonable monthly repayment.

But there are many financial pitfalls – from fuel to servicing to road tax and insurance – when it comes to car ownership and we are not just talking about depreciate rates and loan interest rates.

How this ruins your Raya

First, restricted cash flow. Since you would probably take out a loan for your car, monthly repayments kick in once you are handed the keys.

So you’ll probably have to cut back on a lot of things in the name of servicing that car loan.

Second, run the risk of having your car repossessed. This is a reality that comes with car ownership.

Festivities or not, the moment you draw out a loan, you are subject to paying the loan according to the agreed deadline between you and the bank. Not being able to do that because you blew your budget will not cut it.

The last thing you want is to recall a Raya where your car was repossessed and put up for auction.

2. Drawing out a personal loan

The World Bank last year discovered that only 36% of Malaysians are financially literate.

Such illiteracy is filled with dire consequences: bankruptcy. Actually besides car loans, many Malaysians are bankrupt due to personal loans.

Personal loans, just like credit cards, exist for a reason. With good intentions, you could finance a pet project or even consolidate and pay down debt.

But you can definitely use a personal loan for a wider range of intentions such as vacations, home renovations, weddings and even big ticket items such as a new surround sound system for your home.

If showboating is what you have in mind, think again. Under the revised bankruptcy laws, the threshold for debt has been increased to from RM30,000 to RM50,000.

Banks are offering personal loans these days up to RM150,000 and you could be swayed into drawing out a loan in the name of a Raya upgrade. But committing to those monthly repayments though…

How this ruins your Raya

First, tighter cash flow. Like a car loan, monthly repayment kicks in once you sign the agreement, meaning you’ll have less cash to use for Raya, worse if you have to hand out green packets of duit raya to friends and family members

Second, outstanding debt affects your credit score. This makes you a less desirable candidate when it comes to applying for a mortgage or car loan. You could be denied a loan or even get stuck with a less favourable interest rate – all these affect your finances in the long run.

Worse is if you have a family and children, which means you could potentially even financially neglect them just to pay off your debts.

Third, bankruptcy. All you need to do is have an outstanding of RM50,000 and above with a default period of at least 6 months to be declared bankrupt. Your assets will be administered by the Director General of Insolvency (DGI) to settle outstanding debts.

Yes, this means all your assets and properties and sell or dispose them to repay creditors. Also your passport will be held by the DGI, meaning you can’t leave Malaysia.

3. Maxing out your credit card

It being the festivities and all, splurging a little on that baju raya is okay. But swiping that plastic for a Prada tote bag or Jimmy Choo pumps or an iPhone? And don’t get us started with shelling out hundreds for jars of kuih raya.

The Asian Institute of Finance found that 47% of young Malaysians are engaged in expensive credit card borrowing.

It found their debt woes were the result of impulse-buying behaviour coupled with easy access to, well, personal loans and credit card financing.

A credit line is helpful if moments where you truly need cash and by this we mean more serious reasons than compulsive shopping.

When used properly, a credit card helps you save, whether it is in the form of cashbacks or discounts and privileges. Some credit cards even offer seasonal treats including festivities such as Hari Raya.

Not being prompt on your monthly payments or skipping payments altogether can lead to dire straits and you are looking at anywhere from incurring late payment charges to a black mark on your credit report to bankruptcy.

How this ruins your Raya

Straddled with long-term debt. If minimum monthly repayment is your MO, you are going to be straddled with debt for a few more Hari Rayas. Looking forward to future festivities is not going to be fun as you will greet each Hari Raya with tighter cash flow and debt.

Second, you’ll deplete your savings. Either by paying off debt or to manage your lifestyle. With the odds against us, from insufficient EPF funds to retrenchments, a decent amount of savings can help us survive such devastating outcomes.

Not having any savings would just leave us vulnerable. Then there’s the usual stuff that happens if you can’t service your debt – all that we’ve mentioned previously.

Keep things simple

Spend if you can afford to. The joy of Hari Raya or any festivity is to actually indulge in the company of others.

The customary duit raya handed to friends and family, particularly children, and the open houses all embrace the spirit of living in community.

In fact, you don’t need to sell your kidneys to look good during Raya – discounts aplenty and you can surely snag an affordable baju raya.

Financial prudence is timeless but so is debt. Remember that an abuse of credit has long-term consequences and if you are not prepared to promptly pay it down, not even your brand new baju rayacan help you in that department.

Source

Why do Some People Get Special Treatment at Banks? Let's Find Out!

All You Need to Know About Priority Banking

Wondering how premier or priority banking works and how to get those exclusive benefits and privileges? We explore exactly that!

When driving past a bank, there are times you may come across some car parks reserved for special customers. As you circle around the area looking for a spot to park, you’re probably thinking, “How come those people get to park right outside the bank and I don’t?” The answer is priority banking.

What is Priority Banking?

As the name suggests, priority banking (also called premier banking) is the kind of services, benefits, and privileges that a bank affords to particular customers.

Most banks that have a priority or premier banking facility set up, have dedicated counters, lounges, and staff to attend to these elite individuals the minute they walk through the door.

What Kind of Benefits do Priority Customers Get?

The first benefit you will notice all banks provide is a dedicated relationship manager to assist them with their banking needs, whether it’s advice for investments, help with securing loans or managing their savings account.

Being a priority customer also gives the individual reduced preferential rates on transactions or in some cases, completely free of charge. For example, priority customers may enjoy a waiver on their international telegraphic transfers (TT) within its network or omission of cash withdrawal fees while overseas.

Selected banks also provide special foreign currency exchange rateson top of the fee waivers on international transfers.

At selected financial institutions, priority customers can expect to receive lower interest rates on home loans and personal loans as well as fee waivers for their credit cards as well.

On top of that, they would also enjoy certain lifestyle privileges which grant them access to premium airport lounges in other regions, special invites to events, shopping offers, and other exclusive deals.

Those Sound Great! How do I Get to be a Priority Customer?

Priority banking customers are usually invited exclusively by the respective banks. Sometimes, other priority customers can make a recommendation to nominate a person but will of course be at the discretion of the bank.

While each bank has a different set of criteria for eligibility, it usually requires an average sum of RM250,000 worth of deposits and/or investments. That means, if you have RM150,000 in some form of savings deposited in the bank, a combination of investments worth another RM100,000 should secure you that priority banking status.

So Why do Banks Have Priority Customers in the First Place?

How well a bank can run its operation depends heavily on how much cash the bank has to work with. Treating certain customers with special privileges is done to entice them to do more business with the bank, thus giving the bank more funds to continue operating and servicing all its customers.

The banking industry uses its financial knowledge to do this by offering advice, cutting down on paperwork, and generally holding the priority customers’ hands throughout their financial dealings with the bank.

For example, a regular customer would probably look into a safe place like fixed deposits to generate a steady stream of interest earnings.

On the other hand, the priority customer might be pointed towards different financial tools and other options which require a bigger commitment as well as higher risk for better returns.

Helping their most cash-rich customers do business benefits both the customer and the bank. The customers get better service and their money gets manages better, and the bank in turn gets their business. It’s a win-win.

Source

Treatments You Can Get For As Low As RM1 At Malaysian Government Hospitals

Health is wealth, and in most cases, your health has a direct correlation with your wealth. With medical costs expected to increase by 17.3%, there’s the never-ending concern of what’s going to happen when you or your family member falls ill. Would you be able to afford the best treatment?

Budget 2017 saw RM25 billion being allocated to boost quality of healthcare and the health of the people in the country. This will include a total of RM536 million being allocated for upgrading of hospital facilities. Yet even with a higher budget this year compared to the previous Budget, treatment costs for the first and second classes in government hospitals are expected to increase, according to recent reports.

Despite the expected increase, public hospitals will still be more affordable than private hospitals..

Which class are you in?

There are three classes in government hospitals that are being offered different types or levels of services, and facilities. The fees you need to pay differ for all three classes of patients.

A woman named Loretta who regularly goes to a public hospital explains that when you register for treatment, you are automatically placed in the third class. “You can always move to a higher class after that,” she further explains. “So if I find myself needing a more quiet room to rest, I would request to be sent to second class.”

Rooms in the third class are often packed with up to six people or more, depending on the volume of patients on that day. Regardless of which class you’re in though, you will get the same level and quality of treatment from the medical personnel.

If you are admitted to a government hospital for any type of infectious diseases or illnesses, all charges will be exempted.

For other type of sickness, your charges will only be waived, or you will be given a special discount if you meet the following criteria:

• Earning below RM300/month
• Holding a Social Welfare or National Islamic Council (MAIK) card
• Disabled person
• Student
• Government servants

Malaysians who hold certain positions in the government, such as those who serve the army and special officials of the government are automatically placed in first class and have their treatments paid for by the government.

As mentioned earlier, the quality of treatment would still be the same regardless of which class you’re in. With that in mind, here are some of the treatments you can get from government hospitals that are affordable.

1. Outpatient treatments

Image from The Star

Whether it’s the big or regional government hospitals, or the government clinic, all outpatient visits and diagnosis are RM1. The cost only goes up when you have to see a specialist, such as those who have to follow-up after being warded or were referred to by government medical doctors. These follow-ups usually cost RM5 per visit.

Outpatient Visits	Government Hospitals	District Hospitals	1Malaysia Clinics
Fees	RM1	RM1	RM1

Types of Referral	Fees
Referral from government medical officer	Free for the first visit, then RM5 for every follow-up (inclusive of enquiries)
Referral from a private doctor	RM30 for the first visit, RM5 for every follow-up (not inclusive of enquiries)
Follow-up cases after released from ward	RM5 for each treatment (inclusive of enquiries)

2. Accouchement and delivery

For birth via normal delivery, the cost is only RM10 for those in the third class. However, other types of delivery will incur different costs.

Types of Delivery	First Class fee	Second Class fee	Third Class fee
Caesarean Surgery	RM800	RM400	RM100
Normal Delivery	RM300	RM150	RM10

Based on our previous article, a Caesarean delivery in a private hospital can cost about RM17,000!

3. Physiotherapy

If you’re in need of physiotherapy, the treatments at the government hospital is pretty affordable. All physiotherapy treatments for those in the second and third class are either RM10 or below. So whether it’s lumber or cervical traction, electric or controlled muscle tests, hydrotherapy, mobilisation and more, they’re all available for RM10 and below.  The lowest cost being physiotherapy recovery exercises in the gym for only RM1 for those in the third class!

Treatment	First Class fee	Second Class fee	Third Class fee
Physiotherapy	RM5 to RM20	RM3 to RM10	RM1 to RM5

4. Daily medical charges

When you are admitted, you will need medical treatment and government hospitals keep the cost standard no matter what medication and attention you need. Admitted patients being treated in the first class will be charged RM10 per day for medical charges. Second class will only have to pay RM5, while third class won’t be charged.

As for admission to ward fees, it will be as low as RM3 per night in the third class. But if you’re opting for a more comfortable room which includes air-conditioning, it’s RM80 per night for first class.

Treatment	First Class fee	Second Class fee	Third Class fee
Admission to ward	RM80/night (with air-conditioning)	RM20/night	RM3/night
Daily medical charges	RM10	RM5	FREE

5. X-rays

For x-rays, there are only two types that are under the RM10 and below category; Superficial X-ray Therapy and Radium Treatment. Both of them are priced as RM10 for first class, RM5 for second class and RM2 for third class.

Treatment	First Class fee	Second Class fee	Third Class fee
X-Ray Therapy (Superficial)	RM10 per treatment	RM5 per treatment	RM2 per treatment
Radium Treatment	RM10 per treatment	RM5 per treatment	RM2 per treatment

6. Cancer treatment

The biggest concern, of course, is the cost of treatment for cancer. The cost of cancer treatment can cost anywhere between RM60,000 to RM395,000 in a private hospital, depending on the type of cancer and what stage of cancer you’re in.

With government hospitals, the cost of treatment for specific therapies will be significantly lower:

Treatment	First Class fee	Second Class fee	Third Class fee
Chemotherapy	RM200 per treatment	RM100 per treatment	RM50 per treatment
Isotope Radioactive Therapy	RM500	RM250	RM125

7. Haemodialysis

For those in need of kidney dialysis, government hospitals offer as low as RM10 in the third class. For those in the first class, the highest is RM125.

Treatment	First Class fee	Second Class fee	Third Class fee
Haemodialysis	RM50 to RM125	RM20 to RM50	RM10 to RM25

8. Psychiatric

For those seeking psychiatric treatment, it’s absolutely free for third class patients. However, for those in the first class, it’s RM750 per visit. While the free treatment is, of course, ideal, getting a slot may prove to be a challenge.

Treatment	First Class fee	Second Class fee	Third Class fee
Psychiatry	RM750 per visit	RM300 per visit	FREE

9. Dental

Image from Says.com

General treatments for dental such as extraction, filling, inlay, and crown for each tooth, scaling and endodontic treatment, are free for those in the third class and below RM5 for outpatient. Extraction and filling for each tooth is below RM10 for the second class.

Dental Treatment	First Class fee	Second Class fee	Third Class fee	Outpatient fee
Extraction-For each tooth	RM 15	RM 6	FREE	RM 1
Filling-for each tooth	RM 20	RM 8	FREE	RM 2
Inlay (but not including cost of metal)-for each tooth	RM 40	RM 16	FREE	RM 3
Crown (but not including cost of metal)-for each tooth	RM 40	RM 16	FREE	RM 3
Scaling-for each treatment	RM 40	RM 16	FREE	RM 2
Endodontic treatment	RM 55	RM 22	FREE	RM 4

It’s a good deal but…

With the skyrocketing treatment costs, Malaysians who do not have medical insurance may find it impossible to seek treatment from a private healthcare facility, which is a common problem in Malaysia. Government hospitals offer affordable and quality treatments and healthcare to all Malaysians, regardless of their income range.

Yet private hospitals continue to flourish, proving that Malaysians are increasingly turning to private healthcare. According to Health Minister Dr S Subramaniam, health spending has more than doubled in 17 years per person.

The reason for this? According to this report, public hospitals are often over-crowded, and the long waiting list is a turn-off for those who would like to be treated as soon as possible. Appointments are done with the convenience of the patient in mind at private hospitals, where you are able to rest and recover comfortably and there are no restrictions for visits from friends and family.

Government Hospitals can get overcrowded – Image by The Star

There have also been plenty of bad experiences at government hospitals that have been shared by Malaysians throughout the years. It’s no wonder many view government hospitals as the last resort for medical treatment.

But with the government putting more focus on healthcare, it’s showing signs of improvement in delivering better quality service, with waiting times cut by 50% and more facilities to treat more illnesses.

According to Prime Minister Datuk Seri Najib Razak, the medical and health charges imposed by government hospitals are the cheapest in the world, with the government subsiding 98% of the medical cost per patient.

With lower cost, demand will obviously surge. At the end of the day, you need to balance the pros and cons of paying more for supposedly better service and shorter waiting time versus paying a fraction of the cost but waiting longer for treatment. Access to treatment should not be a problem for Malaysians, either at public or private hospitals.

Source