The danger of overspending

Report from The STAR dated 28 June 2014 :-

The danger of overspending


WHY are we sinking in a sea of debt? Is it because we spend too much at the pub, buy clothes we don’t need, or purchase a new car when we can make do with the old?

More likely than not, working adults tend to blame the demands of their social lives for getting into debt.

When you prepare to go out with your friends and family, it may be good to have a sort of “mental cap” how much you would like to spend for the day. This will help you to plan where you go and what you would like to do after that makan (meal).

The issue is that, there may be that fear of appearing tight or stingy in front of your friends and acquaintances. It is this perception that fuel overspending.

When you dine out with a group and the bill is split, some may have to pay more and others less because of the price differential in what they ordered. Or they may have ordered two rounds of beer while you only had one. In order to appear generous, you may overlook the matter and split the bill evenly.

Lack of self-control is another reason for “social debt”. This happens at meals and when out shopping with your buddies who may egg you on to buy “that lovely dress which is made just for you”.

And you get carried away and overspend. At the end of the day, you are the one who is going to pay your bills, not your friends.

But it is not just pubs, a fancy restaurant and that new dress that is getting you into debt. We get into debts when we take a holiday we can ill-afford.

Because we have worked so hard for half the year, we think we deserve a holiday but the fact is, we may not be able to afford to go abroad. Holidaying locally instead of taking a trip to the United States will still give you the rest you crave for.

Some of us may need to learn to say “no” to drinks, meals and holidays that break our budget.

Rule 1: Take action, do not depend on your parents to help you. You are a working adult. Control your spending. Instead of spending more, cut your debt burden. Saying “no” can be empowering, especially when you see your bank balance grow.

Rule 2: Keep a little notebook and total up your spending at the end of the day, week and month. That may prevent you from spending beyond your means. Spend on things/services that you need, not what you want. Spend on things that are of value, not a frivoulous purchase. Don’t try to please that pretty sales girl. It’s your money that you are spending.

Rule 3: Be honest about how much money you actually have. This is absolutely crucial. Don’t try to keep up with the Joneses or show off, or to make yourself look good. At the end of the day, you are the one who is going to suffer. Why bother trying to impress people who don’t care a jot for you?

Rule 4: Don’t be swayed by peer pressure. Real friends consider your welfare. Ask yourself: If you are broke, will these same friends help you out? How much you have in your bank account is within your control and yours only. Seriously, if you are honest with a friend about why you can’t afford to spend money on something and you still find yourself being put under pressure, it may be time to have heart-to-heart talk with them, or even rethink the friendship. Real friends will not pressure you to do something you really can’t afford.
The Chinese believe that within each of us, there is this desire to spend and keep up with the Joneses. It is something that is innate within each of us, that it is part and parcel of being human, this urge to impress. This desire to show off is present in a larger degree in some people because of pride, and less in others. We judge others by the car they drive, the clothes they wear and the house they live in. Do not be ashamed of what you have and you will not be pressured to flaunt what you do not have.
As we become wealthier, we buy a better car or a bigger house. The trouble is, all of us tend to think comparatively. As you become even more wealthy, you want a better car, and house, but you are not happier or more contented than before because you still may not have the nicest car among your friends.
There are positive outcomes of comparing and competing. You can compete to become healthier, score better grades, be more educated, or be more skillful in what you do. But when it comes to consumer goods and services, keeping up with the Joneses is not going to get you anywhere but in more debt. So forget about fast cars, that fancy holiday or meal. This thing about living beyond one’s means is dangerous. It will not improve your self-esteem, but is self-defeating.
 

As inflation rises, more Malaysians risk money on online deals

As inflation rises, more Malaysians risk money on online deals


Unlike buying from physical stores, online shopping is more risky due to various scams and bogus e-commerce merchants.

In Terengganu last year, six people were duped by bogus e-merchants on the promise of getting cheap second-hand cars – a trend which consumer watchdogs fear will become more frequent as awareness on safe surfing does not keep up with the increasing number of people who go online to hunt for bargains.

According to the National Consumer Complaints Centre (NCCC), complaints related to e-commerce and online businesses are the fastest growing type of complaints it receives among 20 sectors, which range from household appliances to tourism and food services.

As cash-strapped consumers hunt online for the best deals – which include houses as well as cars – NCCC officials worry that they will fuel the growth of more unscrupulous traders. 



NCCC also feels that lax enforcement by Putrajaya is allowing the legitimate e-merchants to get away with bad behaviour such as false advertising of products and late deliveries.

The most worrying part, said the Federation of Malaysian Consumers Associations (Fomca) secretary-general Datuk Paul Selvaraj, was that unlike regular traders who opened a physical shop or a company, crooked online traders were near impossible to catch. 

“With technology moving this fast, it is almost impossible for us to keep up,” Selvaraj said, on the ability of consumer groups to help consumers deal with e-commerce cheats.

“The burden (when dealing with e-commerce) is shifted more to consumers to make the right choice and protect themselves,” he told The Malaysian Insider on the sidelines of the launch of NCCC’s complaints annual report in Kuala Lumpur on Tuesday.

Bogus e-commerce merchants are different from the typical Casanova scam or the prize-winning trap that Malaysians keep reading about in the media, where people are duped into giving up money with the promise of getting more.

In these cases, shady merchants actually put up advertisements of things for sale, usually at dirt-cheap prices.

NCCC legal executive Santhosh Kannan believes the popularity of e-commerce has shot up in the past two to three years in tandem with bargain websites such as Groupon, MyDeal and LivingSocial.

According to NCCC’s 2013 report, complaints on online merchants have jumped to 3,712 from 874 in 2012.

Also, e-commerce complaints outnumbered the complaints received about physical retailers, which stood at 2,051 last year. 

“This shows that consumers prefer to purchase online despite knowing that they are vulnerable to scams and various problems related to online purchases,” the report said.

The NCCC is a non-profit group that helps consumers and traders handle disputes over goods and services.

NCCC legal executive Santhosh Kannan said although the body only started collecting complaints about e-commerce two years ago, grouses already outnumbered those on non-online retailers. 

“With normal shops you can actually see what you are buying, but it’s different online,” Santhosh said adding that consumers were still prepared to risk their money because online goods are cheap.

Most of the complaints the NCCC received were on late delivery of goods ordered (47.2%), followed by product disputes (20%). 

“Product disputes involve issues such as goods being different than what was advertised, lacking in features and product defects,” the report said.

About 15.6% of complaints were on scams where people lost money, 13.6% on bad customer service and 3.6% on over-pricing and fee disputes.

Although late delivery may on the surface appear a minor nuisance, it can be considered a breach of contract between trader and customer, said Santhosh. 

“Customers order and would need to use a certain product by a certain date.

A retailer who is ordering from a wholesaler, for instance, would lose money if he is late in getting his goods to market.

” Despite the steady rise in e-commerce, he said, the Malaysian authorities have not been doing enough to ensure that businesses follow best practices and go after cheats. 

“Now we even have people selling on Facebook which is very dangerous because they can just close down the site at any time and disappear with people’s money,” said Santhosh.

Selvaraj believes that because this form of commerce is becoming increasingly popular due to convenience and low prices, the government has no choice but to start taking them seriously.

As the cost of living goes up, consumers would be forced to look for ways to save money on everything, including shopping online where prices are lower. 

“Merchants must be made to register their businesses with the Companies Commission of Malaysia and the government must take sterner action against those who refuse to register,” said Selvaraj.

There are a slew of measures under the Consumer Protection Act 1999 that the government can take to act against unscrupulous online merchants but the rub is in the enforcement, he said.

The authorities and the online business community should also develop a certification system to help guide consumers to trustworthy sites.

"There should also be more awareness campaigns on how to shop online safely and what to do when there is a dispute," said Selvaraj.

But at the end of the day, unlike regular shops, where there is a physical business that can be raided, the anonymity provided by the Internet makes it hard to catch bogus merchants. 

“Right now, the best is for consumers to protect themselves,” he said.
– June 27, 2014.
 

China's wealthy ranks fourth globally

Report from China Daily dated 21 June 23014 :-

China's wealthy ranks fourth globally

China and Japan, the only two Asian countries that made into the top five, contribute the most to Asia's growing wealth pool, which took experts by surprise due to the economic slowdown in both countries.

 

The nation stands fourth in the global ranking of US dollar millionaires following the United States, Japan and Germany, which together account for 60 per cent of global millionaires, said France-based Capgemini and the Royal Bank of Canada.

The annual wealth report is the latest of many surveys, highlighting the growth of the wealthy in the Asia-Pacific region, despite concerns over slowing growth in the world's second-largest economy.

The number of people with at least $1 million (S$1.2 million) in liquid assets in China reached about 750,000, compared to 4 million in the US, Japan's 2.3 million and Germany's 1.1 million, according to the survey.

China and Japan, the only two Asian countries that made into the top five, contribute the most to Asia's growing wealth pool, which took experts by surprise due to the economic slowdown in both countries.

"If you look at Japan's economic situation after the disaster at the Fukushima nuclear power plant, it finds itself facing huge costs in terms of cleaning up and rebuilding," said Lu Jinyong, a professor at the University of International Business and Economics in Beijing.

"But probably because of that, it is now considering a green future, providing huge business opportunities in the field of new energy and other industries benefiting from the government's stimulus, which its entrepreneurs can capitalise on."

The report said that the Asia-Pacific region will replace North America to become the world's largest wealth management market thanks to the booming housing market in Asia, Japan's stock market, and rapid growth in China.

Rise in number of ultra-rich individuals in Singapore

Report from The Straits Times (Singapore) dated 22 June 2014 :-

Rise in number of ultra-rich individuals in Singapore

SINGAPORE - The ranks of Singapore's ultra- wealthy shot up last year - along with their combined wealth - on the back of strong economic growth and increased savings.

The number of high net worth individuals - those with investable assets of at least US$1 million (S$1.25 million), excluding homes - rose from 100,500 in 2012 to 105,100, according to a report released yesterday.

This increase works out to about 4.5 per cent, while the combined wealth held by this group jumped 7 per cent, from US$489 billion to US$522.5 billion.

If not for Singapore's lacklustre stock and real estate markets last year, those numbers would have been higher, said the report from consultants Capgemini and Royal Bank of Canada.

But the Republic's above average growth in gross domestic product has helped add millionaires at a steady clip.

"Singapore's business owners and entrepreneurs have become more wealthy because of their own ability to create wealth through their own business, which has benefited from Singapore's strong economic growth," said Capgemini Apac's vice-president and senior account executive Claire Sauvanaud.

 "So, in spite of the stock and real estate markets going down, many Singaporeans have become wealthier."

Hong Kong's wealthy population grew as well, up 9.4 per cent to 124,000, with their combined wealth surging nearly 12 per cent to US$626.9 billion, driven by rising stock and real estate markets.

A study from the Boston Consulting Group earlier this month showed that 100 of every 1,000 households in Singapore had investable assets of US$1 million or more last year - one of the highest rates in the world.

According to the latest report, the number of wealthy individuals around the world rose 15 per cent from 2012 to 13.7 million last year, while their combined wealth grew to US$52.62 trillion, marking five years of growth since the 2008 financial crisis.

While the United States had the most millionaires - 4.33 million - the Asia-Pacific was a close second at 4.32 million. It is pipped to overtake the US this year, led by Japan and China.

Already, Asia's rate of growth in the number of wealthy individuals and their combined wealth outpaced America's last year.

Asia's combined wealth was up 18 per cent to US$14.2 trillion, while America's grew 17 per cent to US$14.88 trillion.

The report noted a clear shift by Asia's rich towards trying to expand their wealth rather than merely preserving it.

In Asia, they reduced their focus on wealth preservation from 38.9 per cent to 31.1 per cent, and raised their preference for seeking growth from 31.5 per cent to 40.7 per cent.

Many of the wealthy in Singapore tend to invest at or close to home, observed Mr Renato de Guzman, chief executive of Bank of Singapore.

"This bias in favour of Singapore and Asia could have caused them to miss out on strong returns generated by developed markets in the US and Europe in the past few years."

Google, Microsoft to add smartphone 'kill' switches"

Google, Microsoft to add smartphone 'kill' switches"


A Nokia Lumia 1020 smartphone is displayed during the 2014 Computex exhibition at the TWTC Nangang exhibition hall in Taipei on June 3, 2014. Google and Microsoft plan to join Apple in introducing theft-deterring "kill switches" in their smartphone operating systems, as part of an agreement with mayors and police agencies

WASHINGTON (AFP) - Google and Microsoft plan to join Apple in introducing theft-deterring "kill switches" in their smartphone operating systems, as part of an agreement with mayors and police agencies.

The announcement came in a report by the "Secure Our Smartphones Initiative" led by the New York state attorney general with officials from San Francisco and London.

The coalition of more than 100 elected leaders and law enforcement officials from major cities said the agreement means the three main smartphone platforms would soon add the feature as part of an effort to curb an epidemic of thefts.

The report said Google Android and Microsoft Windows Phone would add the feature - enabling a user to deactivate a stolen handset - after Apple included this last year.
----- AFP    20 June 2014
 

Five money saving habits that can backfire

June 17, 2014

Here are 5 common money saving habits sins that can backfire if you’re not careful.

 

By Brendon Lee

No doubt that it pays to save. But for some, in their efforts to maximise their savings, resort to penny-pinching habits that end up costing them more in the long run.

Here are 5 common money saving habits sins that can backfire if you’re not careful.

Bulk or discount buying


Malaysians love warehouse sales and you see many lining up for hours to score bargains on items they don’t need or may never get round to using before the expiry date.

Stocking up on household essentials may make sense if its non-perishable items that everyone uses like toilet paper or washing up detergent.

But even toiletries and cosmetics have a two year use-by date. Make bulk-buying work for you by going with a friend and share the discounted items so you only buy what you need yet are able to take advantage of the cost saving.
 Going crazy at dealsites


Group buying sites have grown to epic proportions in recent years with many sites touting hundreds of deals a day.

No doubt, buying deals can save you a lot of money but always remember, as with anything you open your wallet for; ask yourself if you really need or want the experience to ensure you’re not just buying it because it is cheap.

Also note that most merchants will only honour coupons from new customers so hoarding discount coupons won’t always help you save.

Finally, before you hit the buy button: Read all the deal terms and do a little research on the merchant.

Some merchants do offer lower if not the same price as group buying sites if you buy straight from their website.

This is because they don’t have to pay the coupon site any share of the profits. Make sure that deal really is a deal.
 
Forsaking quality for a cheaper price
There are some things in life you shouldn’t skimp on.

Sometimes it’s better to invest in something of a higher quality that will last longer versus cheap products which harm you or which you need to replace often.

This applies to health care, food and maintenance of your house and car.
 
Sign-up offers and upgrades
Merchants are always throwing discounts and free gifts to get us to sign up for their services.

Sales people are trained to push customers to upgrade their purchases.

You may think that you are saving by paying RM1 extra for a larger latte but in reality you’ve just spent more than you intended to.

Some sign-up offers may look attractive in the beginning but may start to eat away at your wallet after the promotion periods ends.

Always ask yourself if you really need a product or upgrade before taking it.

Being stingy on parking and tolls


Some people will go to great lengths to avoid paying toll.

If there’s an alternative route of the same distance then fair enough but if it ends up taking more travel time then the money saved from toll fares are just going into your petrol bills.

Similarly, going around in circles for free parking may be costing you more money than going into a parking lot or parking a little further and walking to your destination.

Indiscriminate parking can also cause wear and tear on your car that could end up causing you more than the parking fee. Or worse, your vehicle could be clamped, summoned or stolen!

Penny-pinching is not necessarily a bad thing.

It’s good to practise good saving habits and reduce our spending.

But a healthy budget also comes from knowing when you are actually saving money as opposed to being true to proverb of ‘penny wise and pound foolish’.

This was brought you by Brendon Lee from RinggitPlus.com. RinggitPlus compares credit cards, personal loans and home loans to help Malaysians get more for their money.

Ikea dismantles fan site founded by Malaysian in trademark row

Ikea dismantles fan site founded by Malaysian in trademark row



 Ikea Malaysia accused Ikeahackers.net of trademark violation and wanted it to cease operations

KUALA LUMPUR, June 17 — For eight years, Ikeahackers.net has been helping fans of the Swedish furniture giant enjoy their purchases in ways not often — and perhaps never — intended

From the unlikely — turning beds into coffee tables — to the inspired — rigging work lamps into bedside lights, the site showed what was possible when a little ingenuity was added to the furniture seller’s range of products.

But that is now coming to an end after Ikea demanded that the website’s founder, Malaysian Jules Yap, cease operations for alleged trademark violation, claiming that she was profiting off the brand’s name through the advertisements served up at Ikeahackers.net.

At first, Ikea’s agents had demanded Yap surrender the website and domain entirely to them, although they have now relented and allowed her to retain the address sans “commercial interests”, which means she is not allowed to generate any advertising income on the site.

Although saying that running a website the size of Ikeahackers costs “quite a bit”, the Kuala Lumpur-based Yap said she agreed to strip away all advertising for two reasons.

  “I agreed to that demand. Because the name IKEAhackers is very dear to me and I am soooo reluctant to give it up. I love this site’s community and what we have accomplished in the last 8 years,” Yap wrote in a blog post announcing the decision.               

“Secondly, I don’t have deep enough pockets to fight a mammoth company in court.” 

On her blog, Yap said she was just “a crazy fan” who never intended to exploit Ikea’s brand, but conceded that she had been naive to have registered the website as such in 2006. 

“Needless to say, I am crushed. I don’t have an issue with them protecting their trademark but I think they could have handled it better,” she added.

Ikea’s decision to go after the what is possibly it’s most popular fan site has since created a storm online and is drawing brickbats from a multitude of websites.



Popular technology website Gizmodo labelled the Swedish firm’s move “a giant mistake”, saying that it would sap the goodwill of fans who gathered around their common love for the firm’s products at Ikeahackers.net. “Instead of encouraging a blogger who has spent years creating what amounts to free publicity for Ikea — and helping people find more reasons to buy products they may otherwise have overlooked — the company is bullying her over a tiny amount of advertising revenue,” the website wrote.

Online publication BoingBoing.net was less charitable in expressing its disagreement with Ikea’s move as well as the eventual outcome. “Ikea’s C&D is, as a matter of law, steaming bullshit. There’s no trademark violation here — the use of Ikea’s name is purely factual,” Cory Doctorow, a popular author and one of the site’s editors, wrote. “There is no chance of confusion or dilution from Ikeahackers’ use of the mark. This is pure bullying, an attempt at censorship. I’m shocked to see that Jules has a lawyer who advised her to take such a terrible deal.” 

Following her agreement with Ikea, Yap is now shifting to a new web address — still undecided — where she promises fans of Ikeahackers “can still find all the useful hacks when you need to”. 

For its part, Ikea said the move was prompted by its “responsibility” to its customers and the trust that they have for the brand, saying that the use of its trademark in Ikeahackers may lead people to think they are connecting with the Swedish firm directly. 

“When other companies use the Ikea name for economic gain, it creates confusion and rights are lost,” an Ikea representative was quoted as saying by British news service BBC.

Ikea was founded in 1943 by Swedish magnate Ingvar Kamprad, one of the richest men in the world.