Although inflation in Malaysia remains stable, having a robust investment plan is crucial. By investing, you can accrue enough wealth to help you survive during uncertain times. Furthermore, reaching future goals that cost money will be easier for you. However, as a beginner, you may need suggestions for what kind of investment to achieve them. So, here are some investment ideas worth trying.
Start with a retirement account
Becoming a member of the Employee Provident Funds (EPF), such as the KWSP, is one of the investment ideas for new investors. It offers tax-free savings and compounding interest, which will grow your funds in the long run. To reap the mentioned benefits, you do not need to register as an employee; informal workers and homemakers can voluntarily contribute at least RM10 per month.
Invest in unit trust funds
Another best investment alternative for beginners is unit trust funds, which closely resemble mutual funds. With this instrument, you can diversify your financial portfolio under professional management to lower the risk. However, unlike mutual funds, you will receive the profits directly. Some popular unit trust funds in Malaysia you can consider include the Public Mutual Funds* or the CIMB Islamic Equity Funds.*
Consider dividend-paying stocks
Stock investment is gaining traction lately, especially since it generally promises a higher rate of return with dividends, a portion of the company’s profits shared with shareholders. By investing in companies that pay out dividends, you can enjoy a regular source of income and potential long-term growth. If you’re new to investing, try finding dividend-paying blue-chip stocks, such as Maybank and Tenaga Nasional.
Invest in real estate through Real Estate Investment Trusts (REITs)
REITs allow you to accrue wealth from real estate investment without purchasing a building, making them ideal for fledgling investors. Here, you can buy a pool of shares from commercial and residential buildings.
It is one of the best investment ideas because it allows you to earn passive income with diversification. If you want to start investing in one, the Axis and the Al-Salam REIT are two of the most popular REITs worth trying.
Start a small business or invest in one
Did you know that running a small business is also a form of investment? Aside from enjoying personal fulfilment from doing what you’re passionate about, you can reap potential high returns from the profits.
Aside from starting a business, you can support local entrepreneurs by investing in their companies. Should you wish to try this strategy, consider investing in e-commerce or the F&B business because people always need them to survive.
Invest in SME digital financing
Since business owners want simpler and quicker loans, you will not experience a shortage of applicants to fund if you become an investor in small and medium enterprises (SME) digital financing platforms. Therefore, you will enjoy higher returns with a lower minimum investment. One of the most recommended platforms you can consider is Funding Societies because you can start investing in various businesses with as little as RM100 for up to 2 years.
Consider investing in gold or silver
Precious metals, such as gold and silver, are the best investment instruments for long-term investors. They are an excellent choice for hedging against inflations since the value steadily increases yearly.
Even more practical is that they’re highly liquid, meaning you can convert them to cash anytime. To invest in silver or gold, you can purchase a physical piece or invest in Malaysian gold-backed funds, such as the Public Gold Precious Metals Fund.
A long-term investment plan is essential for your financial health, even amidst the stabilising inflation rate. There is no better time to start investing than now because the compounding rates you receive will be higher in the next few years.
If you are a beginner, the best investment ideas mentioned above are an excellent starting point. Before investing in anything, you should always research and seek advice from certified financial advisors. Once you start, remember that slow and steady wins the race. Good luck with building your portfolio!
*It is not Funding Societies’ intention to recommend or suggest these funds. Mentioning these funds are merely for the purpose of giving examples of mutual funds available in the market.