How to use our ‘Ang Pow’ money wisely?

It’s the festive season again and Malaysians are blessed with so many different celebrations from different religions and races. During celebrations like Hari Raya, Chinese New Year or Deepavali, it’s a tradition that we give and receive kind of ‘ang pow’. It’s a blessing. But, how we utilize the money given could make a different.

More or less, the money that we received can make our life different if we utilize it wisely. And, below options show us some of the wise ways to use our ‘ang pow’ money.

1. Pare down your debts
   This should be your first action if you’re having debt, especially credit card debt. Some of us might overspend during pre-celebration like buying new clothes, hampers, gadgets… and many of us used credit cards to pay for that. Post-celebration, reality sets in and it’s payback time! What other better option than using your ‘ang pow’ money to repay?
   
   
   Of course, we don’t encourage you to spend first and pay later kind of mindset. What if the ‘ang pow’ money collected is lesser than what you have spent?
   
   
2. Save it down
   If you do not have debt, congratulations and you should cultivate the good habit of saving. Start with your ‘ang pow’ money is a good option every year. Furthermore, every year banks are offering Fixed Deposit promotion to attract you placing your blessed money with them by giving higher interest rate. Think about it!
   
   
   If you have kids, let’s buy a coin box, calculate, record and insert their ‘ang pow’ money into it in their presence. Demonstrate to them and write their name on the box, so that they know the money is for their future use. Or, bring along your kids to the bank, open a junior bank account and deposit the money in. Getting their involvement is crucial.
   
   
3. Invest for future
   This is another good option, especially if you’re a parent with small kids and want to plan for their tertiary education funds. Simply save your money in banks is too conservative and can’t help much. Do some investments and utilizing the ‘ang pow’ money of your kids for their own benefits should be the way.
   
   Example, your RM1,000 yearly investments could be snowballing to become RM39,127 or RM69,730 after 15 or 20 years respectively (assuming 10% annual return).
   
   
   Invest in knowledge is another form of investment also, especially for young graduates. Buy some personal development kind of books each year to learn or enhance our knowledge and skills. Example, financial planning related books for proper money management and avoid falling into debt trap.
   
   
4. Giving as caring. Do some charity.
   Of course, we can’t forget those unfortunate people who couldn’t enjoy the festive season as we are due to various reasons. By giving back to society, this is the best blessing ever we can think of. Once again, get involve with your young family members, in another way to let them feel content in their current life and be humble. Some suggesting to allocate 10% - 20% of our ‘ang pow’ money for charity purpose.

You might have other better ways, and gamble it away is definitely not the route to take. Anyway, I believe that we don't have to teach you how to spend it. Right? Haha... To end this, we would like to this opportunity to wish all of you a happy Chinese New Year!

Finance Malaysia, a one-stop financial blog in Malaysia covering various financial related topics.