Sunday 9 June 2013

Liquid Assets VS Fixed Assets

Fixed Assets or Cash ?

Haven't you heard :Liquid or cash is King somebody said some time ago.
Is that true ?
Let's look at what are Fixed Assets and Cash ?


Fixed Assets:                                      
Your Home
Real Estate
Raw Land                                                                       
Buildings
Plantations





Cash:
Money in the Bank Savings Account                     
CD's or Fixed Deposits
Stocks and Shares
Mutual Funds
Bonds

It is good to have cash and better to have a mix of both assets and cash.You would certainly need an amount of cash for short term expenses and emergencies.
The question how much cash is enough and how much assets should one accumulate at a time?
There is such a process called asset balancing.
To do an asset re-balancing ,you need to take inventory of your all your assets,liability and calculate your net-worth.Put in pespective percentages of all these figures.Next look at what is your cash ratio by determining the cash position.As a general rule if you are below 30% of cash equivalent your assets are inbalance.You need to liquidate some assets or increase your cash allocation.Its simple but if it need be you should engage some professional help.
Good Luck !

Article by :
Rodzman bin Abdul Rahim,ChFC,SRFP,RFP
MD Green i Financial Technology Sdn Bhd
Email:greenifintech@gmail.com
Website:www.greenifinancial.com




Friday 19 April 2013

Save Money by Tax Planning

Greetings,
It's Tax time again just closing at the end of this month.Have you submit your returns???
It is advisable to do some planning a few months in advance but it's never too late to start now !
First step:
Take inventory of all your receipts for your expenditure last year.Do up a personal account statement.This should give you an idea of your actual income and expenses.
Second Step:
Categorise all your expenses into deductible and relief allowed by the Tax returns.
Third Step: 
Check the Tax hand book (its available for free) for deductibles and relief allowable for current returns to maximise those deductibles and relief by noting the figures and compare them to your accounts by marking those allowable and noting which you might miss out in the accounts by adding them to the allowable figures.
It's not that difficult, however if you have trouble and you are running a business then things could get complicated. Remember the Tax agent only put in the figures you give him.You must be able to get the accounts done yourself or at least have a simple record of what was your income,personal expenses,business expenses,capital gains or lost,gift and donations before seeing the Tax agent.

Good luck and if you are still not sure what have gone in and out of your pocket and how do you treat them as far as Tax is concern than get professional help immediately.

Disclaimer:The above article does not constitute or be liable to effect your tax in anyway nor does it claim as a Tax advise that guarantee of your success to reduce your tax in any way what so ever.We will not be liable in any way should any loss be incurred by you from following the above advice.

An Article by:
Rodzman b Abdul Rahim, 
Chartered Financial Consultant(ChFC)
Syariah Registered Financial Consultant(SRFP)
Registered Financial Consultant(RFP)

Thursday 21 February 2013

Making Your Money Work Harder......

Your MONEY meeting Cost are rising everywhere?

Is your money working hard enough in every area to cope up with the rising cost?



                                      Do you need to rescue your Money with a life Line ?

Let's start with the little things that we do daily.
We fill up gas everyday.
We do a little shopping here and there.
Most of us use the Credit or the Credit card or draw money from the ATM.

When we do these activities the banks charges invisible fees that a lot of us do not take into account as it is negligible.To us it is but to the banks it's big money.
How about turning the tables around and letting the bank pay us for 
using their brand ?
Rule no.1
Never withdraw cash using your credit card.
The bank can never charge us for not using this facility
Rule no.2
Do all payment due on line or use the ATM.
We get small discounts at times and save time and money by doing this and make sure you pay all bills on time.
Rule no.3
Draw cash on a set day once a week only using your debit or ATM card only.
By doing this we will never exceed the pre-set maximum limit of number of withdrawals by most banks.  

Most important remember your monthly credit card due date for payment and never exceed it.Better still pay days in advance.By doing all of the above and by having a positive balance in the credit card even if it's a very very small amount, you are now in a position to have your bank pay you!

Note that you will need to do some homework to find out if the issuing bank of the credit card pay us for having a positive balance.

Good luck! and get Lucky all the time.

This article is a courtesy by:
Rodzman bin Abdul Rahim, 
Chartered Financial Consultant,(ChFC),RFP,Syariah RFP,Dip FP
www.greenifinancial.com



Wednesday 23 January 2013

Embrace Islamic Finance and Beware of The Capitalist Trap


This article was written in 2008 and is worth to re-visit going forward.
Questions & Answers
Global Credit Crunch And Wider Implications
10-10-08
Adnan Khan

1. What is the financial crisis termed the ‘credit crunch’? What are the potential implications of the financial crisis for the economy?

The credit crunch crisis is the term given to the crisis which led to banks to stop lending to each other creating a freeze on the financial markets, leading to the collapse of Northern Rock, as one example. There are a number of implications as various aspects of the economy are directly or indirectly linked to the crisis:

Both the US and the Britain have witnessed debt driven growth other the last decade, this is now coming to an abrupt end.

• In Britain the economy is worth £1.3 trillion whilst consumer debt is £1.4 trillion

• The easy availability of credit drove the housing bubble, now the main engine for that - debt is running out of fuel


2. What are the main causes of the financial crisis?

There are a number of causes which caused the crisis some a result of other factors and some more important then others:

The lending of money to high risk customers, with very little chance of them being able to meet the obligations i.e. sub-prime loans.

• Banks then turning such debt into ‘tradable commodities,’ CDO’s, MBS’s etc. i.e. debt became a product that was brought and sold.

3. Is the main problem poor homeowners in the USA who couldn’t pay their mortgages or are there more fundamental reasons in the way the financial system works?

• The financial side of the economy is now the largest sector in Western economies, this has resulted in governments giving huge concessions e.g. the non-regulation of hedge funds, tax breaks and cuts as well as bailouts.

• The ability of banks and Western governments to continually print money at will, will always create bubbles. For example the US only has $1.4 trillion in circulation, its banks have used that to create a further $11 trillion through fractional reserve banking.

• The philosophy of Capitalism of perpetual economic growth is actually unsustainable and is what causes the periodic crash, recession and crisis when people’s excesses reach boiling point.

• Capitalism believes if all people pursue their self-interests/Greed then the right things will get to the people who want them. Greed is seen as a good thing and necessary for Capitalism to work, hence predatory mortgage lending, exuberant interest rates, dodgy credit ratings all show greed.


4. What has been the response of the governments to address the crisis, is it enough and has it worked?

Central banks around the world poured money into the markets to shore up the freezing of funds

• The British govt nationalised Northern Rock which was on the verge of collapse

• The US govt arranged the eventual sale of Bear Stearns, the 5th largest investment bank in the US when it was on the verge of collapse

• The US plans on tax rebates in September to a large chunk of the population in the hope the US economy can ‘spend its way’ out of the crisis.

• The British government cut a deal with the banking sector to the tune of £50 billion where it would swap their bad debts for government money, and then use this as collateral in lending.

Government actions have lead to the halting of complete economic collapse as was seen with Northern Rock, However with debt having driven the economies in the West in the last decade, this will have series repercussions - potentially a recession

5. Does the government bailouts not contradict non-interventionist capitalist thought and potentially accentuate the crisis through ‘Moral Hazard.’

The free market has once again been brought into question; there are many that believe the government should intervene due to market failure. Banks most certainly would not have created toxic products if they knew they would have to face the full consequences of their actions.

6. Some have suggested greater regulation and transparency will this work?

This is the standard answer after every crisis; regulation on lending was brought in after the great depression, the stock market crash of 1987 brought in more regulation. No amount of regulation can deal with something which goes down to the very belief of Capitalism - Greed

7. What lessons can we take from this crisis about how western financial markets are fundamentally flawed?

The financial markets in essence is a parallel economy, rather than work in the real world, participants gamble on what is going to happen in the real world - by betting on how businesses are performing and by betting on their profits. This is the fundamental problem with financial markets, they produce nothing real

8. The economist magazine faithfully defended western financial markets, while acknowledging the flaws in the system, by dogmatically stating ‘bubbles, excess and calamity are part of the package of western finance, and still worth it,’ Is it still worth it.

No, and this avoids any discussion on free markets, Financial markets played a miniscule role in the economic development of Britain, US, Germany, Japan and France. They are not necessary to have for the development of nations and are not part and parcel of modern life; they are part and parcel of Capitalism. Communism and Islamic history did not suffer from such crisis (or more at such regular occurrence).

9. What alternatives does Islam offer, given that the Islamic financial system is not based on interest?

Islamic system is based on the real economy, not parallel economy

• Investment in Islam is in real goods and services not on the value of a business etc

• Finance can be raised through banks who will pool deposits, and invest them around the economy and share in the risk of ventures.

• This is actually what lead to the development of the first corporations

• State grants


10. How will Islamic companies raise finance in order to start up and grow which is important for a thriving and vibrant economy

Through state grants and loans and as stated above through banks. The economic development of the British Empire and the US was primarily thorough state intervention in key sectors of the economy, protecting those markets through tariffs and providing cheap loans and grants and monopoly rights i.e. economic development is generally always centrally driven.
Submitted by a Mujahid

Sunday 13 January 2013

Start the New Year with 'a' GiFT for your Business

Greetings from GiFT 

and
 wishing all our members and readers a 
Wealthy and Healthy year 2013
GiFT starts the new year with being highlighted in the local news.

Published in Utusan Malaysia on the 3rd January 2013
Uplift your Business Integrity with 
GiFT Business Continuity Program(BCP) 


Published in Utusan Malaysia on the 3rd January 2013
'BCP' Expensive for your business if not properly done 

Posted by:
Rodzman Abdul Rahim,
Chartered Financial Consultant,(ChFC),
Registered Financial Planner(RFP)