May 23, 2014

Begin Your Financial Planning Know Where You Are

By Aldric

LEGAL DISCLAIMER: What you find in this entry, and this blog, are opinions of Aldric Tinker based on observation, reading, research and experimentation. The author ensures the accuracy of the information at the time of writing, but it is not a definitive guide; so the author cannot and will not assume any liability for the consequences of adopting these opinions. As a consumer and investor, you are required to perform your own research and discuss with financial professionals near you BEFORE implementing or adapting the ideas herein.

Before you take up any plans, the ideal scenario would involve you sitting down and seeing your current financial health. No use getting products and plans that end you in debt you cannot afford! And no matter how good a deal it is. But be realistic: we don’t have this habit. At best, we budget. But detailing our income and expenses, assets and liabilities are key to financial success.


If you haven’t already, go over to and download the Worksheet. Basically here are all the four things that you need to know:

  • Income: Your monthly revenue
  • Expenses: How much you spend
  • Asset: Anything you own that puts money into your pocket
  • Liability: Things you own that takes money out of your pocket

Say you own some Unit Trust. Write down the name under Stocks/Funds/CDs. Write the amount that you have. Say 18,975.33 units. Under cost/share, you put RM5,000. This means that with your RM5,000, you have 18,975.33 units; so its price per unit/NAV is RM0.2635. If you receive an annual income, you may write it in your income statement for that month you receive it. Now that unit trust is truly an asset for you.

What if you have a house?

Write the house under “Real Estate/Business”. How much was the down payment? Let’s say it is RM20,000. And your house costs RM200,000. So, under the “Cost” column, write “RM180,000”. Moving to the lower right hand side, write the name of that house. Beside it, under “Mortgage/Liability”, write your amount of “RM180,000” (if this is your mortgage). Your property is only an asset when you enjoy positive cash flow, after taking out the monthly expenses related to the house.

This is an exercise I’d like to conduct with my clients and investors. Maybe initially over a game of Cashflow 101. Did you know you can download the app for your iPad?

It is my personal policy that I’d like to see my clients become investors. Just as I give myself financial education, I’d like to pass this knowledge onto them. The more educated we are, the better we can weather the financial storms of the future.