Taking out loans is a normal part of life. Some take out loans to buy a house, or a car, to sustain their lifestyle and many other things. But is there a better way to manage debts, so we can save monthly repayment and sleep better at night?

Meet Isabela (not her real name), a working mother at a multinational bank in Malaysia. Managing 20 employees as a senior manager while raising seven children was frequently like working two jobs. She was so busy she did not have time to manage her finances.

As a result, Isabela suffered from a negative cash flow of RM5,000 every month, even though she earned a T20 income* as a senior manager in a bank. She constantly asked these same questions over and over: “Why is it that I pay my credit card bill every month on time, but my outstanding debt seems to be getting bigger and bigger?”

So how is it possible that if one pays their credit card on time, they are still in debt?

This is what we found out when we sat down with Isabela. The main contributor to her RM5,000 per month deficit is the ‘Loan Repayment’ row (in the diagram below).

Can you imagine paying RM11,000 per month on your loan repayments? Is there a way to save monthly repayment?

Read: Save RM1 Million On Your Own Or Do It By Buying A Property?

How To Save Monthly Repayment Up To RM9,000 Per Month?

As I dug deeper, I found four credit cards with multiple instalment plans (refer to Chart 1). “Okay, it’s not too bad,” I thought. I have seen worse, something like 10 to 20 cards.

For Isabela, some of the cards were tied to recurring payment plans. Nothing out of the ordinary but they all had one thing in common: all the cards had outstanding balances.

I started to organise them to understand how much she was paying monthly for each card. Here’s a snapshot, where we found the root cause.

I realised she was paying a fixed amount for some of the cards. I knew she was in trouble because her income couldn’t support the card repayments. She was paying on ‘gut feel’, meaning she would pay an average of RM3,000 per card for three of the four cards.

For example, as shown in Chart 1, she only pays RM3,000 for her CIMB Credit Card. However, the monthly instalments come up to RM2,130, and she was spending RM3,071 in June, totalling to RM5,201. Meaning the payment was short of RM2,201, so she owed her credit card outstanding payments before she started that month.

This is a bad habit and one of the major blind spots for most credit card users as they don’t clear their monthly balance. Here’s what I have to advise:

First, although you pay your cards on time every time, you still need to pay the amount spent in full for that month or else the outstanding will grow out of proportion. You cannot just pay on time without paying in full for what you need to pay.

Secondly, when you miss paying in full for one month (that means having an outstanding balance for the following month), it would be very hard to keep track of your expenses. It becomes impossible to reconcile what you spend the subsequent months unless you sit down and take a snapshot of your expenses over three months of credit card spending.

Read: Saving vs Investing, Should I Save Or Invest?

When you don’t know what you have been spending, you won’t know how much you have to pay. And this will go on like running on a treadmill that won’t stop and will keep going faster until you fall.

Thirdly, most people who constantly pay off any outstanding monthly credit card expenses will not have this problem.

So how can we save monthly repayment and solve this issue?

Read: How Can You Save Money Without Even Realising It?

Case Study On How To Save Monthly Repayment

Once we identify the problem, we can develop solutions and strategies. In Isabela’s case, here’s what we needed to do to save monthly repayment:

1) Restructure her debt and consolidate it into one unifying loan.
2) Manage her expenses through ICE JAR, the world’s simplest money management system, to prevent her from falling into the same situation in the future.

Although she has a housing loan that we can use to consolidate her credit card debts, there wasn’t much capital appreciation as these properties were purchased recently.

So, we had to use another ‘container’ to consolidate her loan. The most effective ‘container’ is similar to a housing loan that uses a ‘reducing balance interest’ calculation instead of a ‘fixed line interest’ calculation loan (also known as a personal loan) that most people use.

Within a month, my team and I managed to help Isabela find her ‘container’ and save monthly repayment by reducing her loan repayment from RM11,648 to just RM2,594 monthly.

Many of our fellow Malaysians are unaware of a significant difference in interest calculation.

Read: 4 Money Personality, Find Out Yours

The ‘fixed line interest’ calculation (typically used for traditional car loans and personal loans) is very different from the ‘reducing balance interest’ calculation (typically used for housing loans). Let me illustrate by using this example of taking an RM100,000 loan with a 5% interest rate over ten years.

From the diagram illustrating Isabela’s Debt Consolidation Strategy (DCS), you can clearly see why I chose to use the ‘reducing balance interest’ option. Given the same loan amount, interest rate and same 10-year duration, and a monthly instalment of RM1,250, you can see that the ‘reducing balance interest’ calculation gives 50% interest savings compared to the ‘fixed line interest’ calculation.

This is how you can save monthly repayment and sleep better at night.

Read: 6 Ways To Deal With Inflation

This is the reason we need to invest in our financial education. As they say: “Education lifts us past poverty,” and that especially includes financial education, and save monthly repayment is something that almost everyone needs to know how to do it.

*T20 income is classified by the Household Income & Basic Amenities Survey Report 2019 by the Department of Statistics Malaysia (DOSM). The income classifications for T20 have been revised to reflect inflation, the rising cost of living, and household size, among a host of other factors, into two parts:

• T20 Part 1 – RM 10,961 to 15,039 and
• T20 Part 2 – RM 15,040 and above

About the Author

Ng Ka Hoe is a Licensed Financial Planner and a Financial Adviser Representative (FAR) with Bank Negara Malaysia and“Capital Market Service Representative License (CMSRL) Financial Planner with Securities Commission Malaysia. He is also the Founder of J Advisory, a Personal Finance Academy that helps struggling Malaysians elevate their financial well-being with proven tools, systems and strategies. For more real-world case studies, you can head over to https://jadvisory.asia/.

The following story is based on an actual series of events with some names and circumstances fictionalised and any similarity to the name, character or history of any person is entirely coincidental and unintentional. We will be taking a closer look at why the executor of will is not as easy as it seems to be.

Elson and Jason were good friends for many years. They have met each other since primary school and even graduated from the same university. Growing up together, Elson would fend off those who bully Jason at school. They would also go to their makeshift secret base and play the whole afternoon after school.

Jason was the only child in his family, and because of that he sees Elson as the big brother that he never had.

As time goes by, these two boys have become men. They have both secured good jobs and beautiful and kind wives who bore them healthy children. It was a family that any man would be proud of with much love and warmth.

Read: True Friend Dilemma, Declaration Trust Coming To The Rescue

Not Ready To Be The Executor Of Will

What seemed to be an ideal life for Jason soon came to a tragic end. What seemed like a normal cough, turned out to be lung cancer. Elson’s heart was shattered, he felt as if he was betrayed by a person that he trusted the most.

“How dare he leave me behind?” was the first thought that came into Elson’s mind when he learnt of Jason’s departure. There were so many dreams that they had yet to achieve together.

Elson made a promise to Jason that he will take care of Jason’s family and everything else. “Rest in peace my brother, I got you. See you on the other side.”

Jason’s wife, Yvonne found Jason’s Will. It was a simple Will that named her as the beneficiary of every asset that Jason owned. Elson was named as the Executor in the Will. She wasn’t sure what an Executor meant, but since Elson’s name was mentioned, she guessed he may have known a thing or two about it.

Read: Unfulfilled Wishes, Learn How To Protect Yourself

Becoming An Executor Of Will, Is It A Nightmare?

That starts with being the appointed executor of will to sort out what was left behind by Jason. Even with no knowledge or experience in administering the Estate, Elson thought, what could go wrong?

A few months later, with the assistance of a lawyer, Elson obtained the Grant of Probate from the High Court. It was quite a straightforward though tedious procedure. All he had to do was to look out for the lawyer’s details of Jason’s assets.

With the Probate in hand, Elson thought all he had to do now was to transfer the assets according to Jason’s instructions in his Will, which is quite clear cut to Elson. Jason’s Will basically says to give all his assets to his wife.

Yvonne asked, “What about my husband’s debts? I know he has a few credit cards that needs to be settled.” Elson had an idea, if he could transfer all the liquid assets quick enough, then there would be nothing left for the bank to chase after.

After all, Jason is long gone now. Who would sue a dead person? Yvonne was sceptical at first, but with enough assurance from Elson, she accepted everything that Elson was transferring to her. Elson had bypassed all Jason’s creditors in administering the estate.

Read: Planning Is Important, Things Can Turn Ugly In An Instant

The Executor Of Will In Action

A few months have passed since, notice of due payment received by Yvonne has now become a letter of demand with a letterhead from a law firm that was appointed by the banks. To make matters worse, Yvonne also received a letter from the Inland Revenue Board Of Malaysia that is addressed to Jason to declare his income.

As much as Elson tried to ignore the demands from Jason’s creditors, he soon learned that he was obliged by the law to pay up the creditors first, especially the tax due, which was one of the first priorities.

All attention is now on Elson, with letters that legal action will be taken against him personally if he did not satisfy Jason’s creditor.

“How does that even make sense? I’m just here to help, now I have to pay the price?!” Elson shouted at the lawyer whom he engaged for advice on what to do with the demands. It is either Elson calls back the assets that he has transferred to Yvonne, otherwise he will have to compensate the Estate’s creditors from his own pocket.

Elson is now desperate. Yvonne had used most of the liquid assets that were being transferred to her. “I have warned you, it was you who assured me that everything is fine. I have used the money. I can’t give it back.” said Yvonne.

While Yvonne was trying hard to scavenge whatever was left, Elson has been trying to see what he can sell off on his own to pay.

It Is Tough Being The Executor Of Will

It was a very bad time for both Elson and Jason’s family that they must face. Being an executor of will sounded very easy, many did not expect there to be so many legal pitfalls until it was too late.

It always starts with good intention to help, but often ends up in a relationship breakdown between the executor of will and the beneficiaries. Elson felt guilty that he had made the matter worse than it should be.

Yvonne had to pull back from some commitments especially the children’s education expenses. Yvonne had to face the embarrassment, but for Elson, he is at risk of legal liabilities. If he is not careful, he could be facing criminal charges as his lawyer said to him this could be defrauding creditors if their claims are not recovered because of his negligence.

A long legal nightmare is the likely outcome, that’s why it is not that easy being an executor of will.

Read: Hard Facts About The Executor Of Will In Malaysia

About Rockwills International Group

Rockwills International Group, now in its 27th year, pioneered professional will writing in 1995 and has since evolved into the leading estate planning specialist in the country. It is today the largest provider of solutions and support services in the areas of trusts, succession, management and distribution of wealth. It has shareholders’ funds exceeding RM50 million. It has done over 280,000 wills and 15,000 trusts and hold more than RM25 billion in assets under trust.

Without a doubt, a lot of people consider money to be crucial in their life. But the question on everyone’s mind is that, can money buy happiness?

Many of us work hard to earn money so we can buy the things that will make us happy and comfortable. While others might look to money for personal fulfilment, which may involve impressing others by flaunting an expensive handbag or dress.

Nevertheless, due to its importance, we can find many people fight over it, hate, or adore each other because of it.

Read: 4 Money Personality, Find Out Yours

Can Money Buy Happiness?

Some claim that you can buy happiness with money because they believe it will give them power, while others might disagree. Can money buy happiness?

From a personal standpoint, I do not agree that we could buy eternal happiness with money.

But then, to buy the things we need on a daily basis, money is a basic requirement in our life. Although having a lot of money may be utilised to buy upscale and pricey items, the satisfaction would only be temporary. Additionally, you cannot buy the feelings of love and devotion with money.

Everyone wants money, but it could not possibly purchase everything. This is true, especially when it comes to intangibles things such as general knowledge or a loved one who has passed away and the experiences you shared with them.

Read: More Money, More Happiness?

In a famous book written by Robin Sharma, entitled “The monk who sold his Ferrari”, the main character named Julian Mantle was a lawyer who find himself burned out and feeling dissatisfied despite his amazing achievements. He was a successful lawyer, rich, and highly sought by clients for law advice and cases.

Suddenly, no one was able to contact him after the incident where he passes out in a courtroom due to a heart attack. He just disappeared and was nowhere to be found.

After three years he came back to meet his friend, John. John was astonished to see Julian glow in joy, looking wiser and healthy. Julian shared with John the lessons he had learn while meditating with the Himalayas Sages-and surprisingly all his happiness now has nothing to do with money.

Remarkably, we can find many people who felt the same burnout experience and a have different definition to happiness as Julian.

Read: How Can You Save Money Without Even Realising It?

Can Money Buy Happiness For A Couple?

In a similar case, Tiger Woods’s ex-wife, Elin Nordegren net worth’s skyrocketed to more than USD200 million after their infamous divorce. While she admitted that money did make things easier for her as she took her children away to somewhere secluded for quite some time from reporters and journalists, she did insist that money could not buy her happiness or put her family back together.

In fact, she claimed her marriage to Woods was one of the happiest days of her life.

Can Money Buy Happiness For Kids?

In India, a man shared over the net that he had broken up with the love of his life and was heartbroken. His friend’s advice him to smoke weed (cannabis) to forget his pain. They agreed to go buy it together.

Arriving at the place they went to; they saw three children playing nearby. The heartbroken man offered to buy them ice-cream and all three of them could not stop smiling while eating. The man said it made his day and he never took the weed.

He then asked for the kids’ permission to take photo of their smiling faces for memories. He would frequently look at the beautiful picture and smile. In his opinion, he claimed money can and does buy happiness!

On the other hand, my beloved father, once told me, if your too rich you can become crazy if you do not know what do with the money. Thus, I guess by having money with a purpose would then mean something, and the type of purpose mentioned here should be more akin to empowering yourself and others.

It should also be inspirational, memorable, helpful, useful, or important.

Despite how great it is, money cannot alter how you feel about yourself. Most individuals make this mistake. They want to be strong, fashionable, or respected. Most importantly, they want to be admired.

However, there is nothing that money can do to alter how you feel about yourself. Money won’t make you proud of who you are if you do not feel so yourself and it will definitely fail you if you have insecurities in believing yourself.

As to answering the question whether can money buy happiness, majority would agree that it does not. But to some it certainly can relieve you some pain, comfort, safety or help when you are in need, thus, that is happiness.

To me, happiness is something internal and intangible. Therefore, to obtain it obviously is not going to be from something external and tangible.

How about you, can money buy happiness?

Read: Are Malaysian Millennials Really That Bad At Managing Money?

About the Author

Azah Atikah Binti Anwar Batcha has Accounting, Finance, Auditing, and Islamic Finance background. She has worked with two of the Big four firms prior to pursuing her postgraduate studies at University of Technology Malaysia (UTM), Kuala Lumpur. She can be contacted at aaabwrite@gmail.com

The following story is based on an actual series of events with some names and circumstances fictionalised and any similarity to the name, character or history of any person is entirely coincidental and unintentional. Let’s look at how a declaration trust can help your friend, as they rightly mentioned “A friend in need, is a friend indeed”.

True friends like Seng are hard to come by. But little did he know that being Donald’s true friend would put him in such a pickle.

Seng found his pool of savings that he reserved for his old age depleting by the day. It had already been more than a year that since he alone shouldered the responsibility to meet the medical expenses of his buddy Donald after the latter fell into a coma.

Donald, who is single and with no family members, has a successful interior design business where he is able to own a few properties and have a sizeable investment portfolio with a licensed fund manager. Donald have been procrastinating to get a medical and hospitalisation insurance policy because of the regular income he is getting from the property rental and dividends from the investments.

He was diagnosed with severe case of Crohn’s disease last year which requires regular treatment and this year had to be hospitalised several times due to kidney failure. Seng has been footing his medical bill since whenever Donald had problems redeeming some of his investment to pay for his hospitalisation bills.

A childhood friend, Seng, had been just a phone call away especially in recent years when Donald became sickly.

In their childhood and adolescence years, they were dubbed as the village Siamese twins as they were rarely seen apart. Seng and Donald shared a very special bond. Even the separation during the years that Donald was studying in England did not see them go their separate ways after Donald returned.

While they took different career paths and Seng eventually found the love of his life and married, the Siamese twins were still inseparable right through their old age.

It became a routine for Seng to drop by Donald’s apartment every other day and also accompany him on visits to the doctor as his health deteriorated. When Donald was well enough, he redeemed some of his investment to pay Seng back for medical and hospitalisation expenses Seng paid for him.

When Donald did not answer his phone call one afternoon, Seng rushed over and found his buddy unconscious. He rushed him to hospital and Donald had since then not woken up from the coma.

As days and months went by, Seng became more worried for Donald. He was also weighed down by the mounting expenses he would have to continue to bear on Donald’s behalf. A dilemma one would not wish upon a true friend.

Seng would not be in such a predicament had Donald had the foresight to plan for such eventualities. One estate planning tool that serves to take care of one’s affairs when incapacitated and not leave one in the quandary without financial support is the Declaration Trust.

Read: Planning Is Important, Things Can Turn Ugly In An Instant

What Is Declaration Trust?

Conceived by Rockwills Trustee Berhad, one can set up a Declaration Trust, place certain assets in the Trust and appoint himself as the Trustee and have a licensed trust company like Rockwills Trustee as substitute Trustee.

The Declaration Trust works in the event of specified triggers such as total and permanent disability, critical illness, disappearance for a period of time or death. Setting up the Declaration Trust, the settlor prepares a trust deed which are instructions for his wishes to be carried out when certain trigger events take place.

Unlike the Will which only comes into effect upon death, the Declaration Trust allows the settlor to retain control of his assets while still alive and facilitates the drawdown of funds from the assets when he is, for example, incapacitated.

Read: Hard Facts About The Executor Of A Will In Malaysia

Donald as Settlor can in the Trust Deed include his investments and monies in his bank accounts as well as name himself as a beneficiary while alive. In the Trust Deed, he can name a trust company as the substitute Trustee, to have access to investments and funds to utilise them in the manner as he so wishes. He can also name beneficiaries to benefit from any balance of trust assets unutilised upon his demise.

The Trust Deed will include a Power of Attorney for the substitute Trustee, which would be a Trust Company as it operates in perpetuity, to step in to administer the assets according to the Settlor’s wishes.

The Declaration Trust has the advantage of distribution of assets to the beneficiaries without any delay when any one of specified triggering events occur and also the benefit of flexibility in safeguarding one’s interest pertaining to access to funds which otherwise could be locked down until death occurs or grant of probate in the instance if there is only a Will.

Read: The Importance Of Estate Planning, Avoid Last Rites Drama

About Rockwills International Group

Rockwills International Group, now in its 27th year, pioneered professional will writing in 1995 and has since evolved into the leading estate planning specialist in the country. It is today the largest provider of solutions and support services in the areas of trusts, succession, management and distribution of wealth. It has shareholders’ funds exceeding RM50 million. It has done over 280,000 wills and 15,000 trusts and hold more than RM25 billion in assets under trust.

The following story is based on an actual series of events with some names and circumstances fictionalised and any similarity to the name, character or history of any person is entirely coincidental and unintentional. Hope that we can learn a thing or two about protecting our children in a divorce.

Today, it is a sad day for Leng Chai. He got divorced from his wife, Maggie. They had a roller coaster marriage. During happier times, they became parents to twin girls. The court granted Maggie custody of the twins.

Leng Chai spent so much time to build a successful business that he neglected Maggie and the girls in the process. Leng Chai and Maggie attempted several times to reconcile but each time, their relationship became more strained.

As Maggie has been out of work for some time to care for the twins, Leng Chai is worried about the financial wellbeing of the girls (now three years of age) in case he dies before they grow up. Though Maggie knows that Leng Chai loves the girls, she is also worried that he may not keep his promise, like so many of the promises he made when they were trying to save their marriage.

Maggie is also worried that he may remarry and neglect the twins especially when he has children with his new wife. Leng Chai, in turn, is worried that Maggie may remarry and neglect the girls to focus on her new family. The least he can do is provide for them financially.

Read: Unfulfilled Wishes, Learn How To Protect Yourself

Protecting Our Children In A Divorce

One of the way to be protecting our children in a divorce, is by the way of trust. An easy way to resolve both Leng Chai and Maggie’s concerns is for Leng Chai to setup a trust for the girls. This agreement to setup a trust could be incorporated as part of their divorce settlement.

The trust would need to be one that cannot be revoked by Leng Chai. If Leng Chai is allowed to revoke the trust, Maggie would be concerned because there is no certainty that Leng Chai will not terminate the trust arrangement in the future or amend it to benefit his new family.

Leng Chai should approach a licensed trust company that is able to address his and Maggie’s concerns for a customised trust solution to be prepared, rather than using a boilerplate trust template. Having a trust company to act as the trustee ensures continuity of the trusteeship and accountability to the twins.

As the purpose of the trust is to provide financial security to the girls, it is important to ensure that the assets placed into the trust provide sufficient funds for them even when Leng Chai is no longer around. Since Leng Hai intends to purchase a RM2 million life insurance policy, he can transfer it to the trustee together with the unit trust investments he owns that has a market value of RM1 million.

With RM3 million in the trust, it makes the protecting our children in a divorce even better. The twins would have financial security to pay for their daily expenses, education, and medical needs in the future.

Read: Fighting Over Equity Distribution, The Importance Of Succession Planning

Taking Care Of The Children In Whatever Condition

During Leng Chai’s lifetime, there should not be any distribution to the girls, but any dividends are reinvested by the trustee to increase the available amount for them in the future. Leng Chai can continue to provide financially for the girls before his death or disability.

When death or disability occurs to Leng Chai or when certain conditions stated in the trust are met, it would trigger the trustee to begin disbursing the funds for the girls’ maintenance, education, and medical needs through their guardian before they are 18 years old.

Leng Chai may want to indicate his investment preferences or give power to the protector to make such a decision. It would make sense for Leng Chai to appoint Maggie to act as the protector when he is no longer around. As the protector, Maggie would be the watchdog for the girls and liaise with the trustee on the needs of the girls from time to time.

The trustee may also refer to the protector for an opinion before exercising its discretionary powers with a view of fulfilling the objectives of the trust and to benefit the twins.

This trust arrangement for the twins should end when Leng Chai is no longer around and the girls reaching the age of 25 years. When they are 25, the remaining funds are to be given to them as a legacy from Leng Chai.

At the same time, Leng Chai should have a will written where part of the instructions may give other assets to the twins when they reach a certain age. However, if he remarries, he will need to prepare a new Will as that marriage will revoke an earlier Will.

Maggie in her Will may use her savings and assets to include a testamentary trust for the girls, should she pass on before they are 25 years old. With a testamentary trust, Maggie will leave clear instructions on how her assets should be used for the twins. This is similar to Leng Chai’s trust for the girls.

There are a few differences between Maggie’s testamentary trust and Leng Chai’s trust.

All Bases Covered: Protecting Our Children In A Divorce

Read: The Importance Of Estate Planning, Avoid Last Rites Drama

For Maggie’s testamentary trust to take effect, it is dependent on Maggie’s passing before her Will is probated and all her debts and taxes fully settled before the testamentary trust begins. It would be different for Leng Chai’s trust where it is not in his Will but in a deed which begins during his lifetime. Leng Chai would have to retitle the unit trust investments and insurance policy into the name of the trustee.

By doing so, the trust will not be subjected to probate and debts, resulting in the trustee being able to use the assets for the girls immediately when Leng Chai is disabled or dies or even when he is having financial difficulty.

In conclusion, by Leng Chai having a trust that is irrevocable for the twins with the right trust company as trustee, it will give reassurance to Maggie and the girls as well as fulfil Leng Chai’s intention to provide for them financially when he is not able to do so.

This will address their concerns and both will have their wishes come true. And that is one way of protecting our children in a divorce.

About Rockwills International Group

Rockwills International Group, now in its 27th year, pioneered professional will writing in 1995 and has since evolved into the leading estate planning specialist in the country. It is today the largest provider of solutions and support services in the areas of trusts, succession, management and distribution of wealth. It has shareholders’ funds exceeding RM50 million. It has done over 280,000 wills and 15,000 trusts and hold more than RM25 billion in assets under trust.

Contrary to popular belief, it’s not just the naïve, greedy and gullible who fall for scams that result in them parting with their hard-earned money.
Scammers are becoming increasingly sophisticated with their tactics and technology that anyone with a mobile phone and internet access is a potential victim. Even though some scams may look like the real deal, you can learn how to spot a scam and do background checks to protect yourself from becoming a victim.

The Financial Planning Association of Malaysia (FPAM) held a Facebook livestream on World Financial Planning Day, which was on the 5th of October 2022, where licensed financial planner, Dr Selina Dang offered guidelines on hot to spot a scam and how to avoid them.

Read: RM5.2 Billion Lost To Scams In Malaysia Over Two Years

How To Spot A Scam

Whatever their modus operandi may be, all scammers have the same endgame: to get you to hand over your money to them. That is why it is important to know how to spot a scam. Here are the common scams going around that most of us at some point might have encountered:

How To Spot A Scam: Macau Scams

You get a phone call out of the blue from an authority body; the police, the magistrate, the postal service or the Inland Revenue Board. The authoritative voice on the line will inform you that you have heavy criminal charges against you. The caller would read out your name and IC number to prove that they know who you are, with the purpose to lead you on to reveal personal information, namely your bank account password.

“The scammers put you under pressure, so they can reel you in. We are susceptible to these kind of calls because of our trust in authority,” Dr Dang said.

How To Spot A Scam: Phishing Scams

You see an ad somewhere on a website for a service you need from a legitimate business. You messaged them and got a reply with a link to their website or a request to download an app. Once you click on the link, you will be taken to a phishing website.

“With one click, you will be compromising all your personal data,” Dr Dang warned. “With the technology they have, the scammers are able to steal your usernames, passwords and even gain access to your SMSs.”

How To Spot A Scam: Investment Scams

The most obvious tell-tale sign that an investment opportunity is a scam, according to Dr Dang, is when they start guaranteeing or offering high returns with little to no risk.

“All investments involve some form of risk. The ones with high returns typically carry higher risk. Be aware of investments that promise to generate positive returns regardless of market conditions.”

How To Spot A Scam: Job Scams

Scammers would pose as recruiters in search of workers for foreign job positions in a foreign country with the promise of attractive job opportunities with a lucrative income. The jobseeker may be required to pay a processing fee in advance for work visas, air tickets and the necessary paperwork needed.

Once the money is paid, the scammer disappears.

Read: Be Wary Of Crypto Scams In Malaysia

Do Your Due Diligence

“The point of engagement is where the scam starts,” Dr Dang said. Thus, the best way to not get scammed is to not engage with the scammer in the first place. Once you know how to spot a scam, it is important not to fall in their trap.

Here are several strategies one can take to protect themselves from being reeled in by a scammer:

Don’t pick up automated calls

“A good sign of a scam call is when you hear a recorded message, asking you to press a number to speak to a person. If you receive such a call, hang up right away,” Dr Dang said.

Never give away personal information over the phone – Some scammers are able to use technology to spoof their number, so that a legitimate phone number will show up on your Caller ID and make you believe you are indeed speaking to a person in authority. Even in such scenarios, Dr Dang would like to remind you that, “No official body will call you for personal information or to threaten you with legal action.”

Have a spam call filter in place

Very often nowadays, we receive calls from unfamiliar numbers, many of which are likely from scammers. Fortunately, most phone models now come with a Caller ID and Spam Protection feature that filters incoming calls. If your phone doesn’t have this feature, you can install the Truecaller app, available on Apple and Android, which is also useful for screening unsolicited telemarketer calls.

“Speak to the elderly folks and teenagers in your family about protecting themselves from scammers, and help them install these safety features on their phones,” Dr Dang added.

Read: Beware of Investment Scams and Financial Gurus

Make sure the bank account you are sending money to is not used for scams

When buying things online where you are dealing directly with the seller, such as through garage sale apps like Carousell and Facebook marketplace, do check to be sure that the bank account you are given to send payment to is not a mule account. This can be done through the Semak Mule portal or the Scam Response Centre by the Commercial Crime Investigation Department (CCID).

Don’t click on any unauthorised links that may take you to a phishing website

“If you happen to click on such links, do not enter your personal details, and only download apps from official app stores,” reminded Dr Dang.

Check with the right regulators

If approached with an investment opportunity, always check first if the product or service is regulated by Bank Negara or the Securities Commission (SC). Next, check to see whether the person you are dealing with is a licensed or unlicensed intermediary.

“SC has very strict guidelines when it comes to investments. Money must be transferred to a legitimate company registered either with Bank Negara or SC, not just any company,” Dr Dang explained.

She then added: “Also, never, under any circumstances, deposit money into an individual’s personal account. If anyone asks you to transfer money to their account or an unauthorised company, please stop. It is a major red flag.”

Now that you know how to spot a scam, let’s do our part to spread the awareness to someone else.

Read: Scam Awareness: Be Informed To Protect Yourself