The mind-set: how the rich get richer, the poor get poorer? You need more money ...

The rich may get richer while the poor may get poorer, but it doesn't have to be that way. It requires a change of mind-set.

I ONCE overheard someone lament that “the rich get richer and the poor get poorer”, which made me think if indeed that statement is true.

The rich do get richer only because they have sound financial concepts required to stay rich. They focus on their net worth, working on their appreciating rather than depreciating assets.

They know how much is required to keep their lifestyle. They don’t necessarily need to be debt-free because they know what good leveraging can do to enhance their wealth. They employ financial strategies which are contrarian to common ones - taking on investment opportunities when others would stay away and having the purpose driven portfolios.

They consciously inject capital into their portfolios rather than on an ad hoc or timing basis. They know the impact of inflation on their money and insurance coverage because they review their financial life regularly. Their financial data is maintained and accessible anytime they want.

The poor do get poorer only because they continue to adopt a poverty mind-set. They focus on their expenses too much either being overly frugal or overly spendthrift.

Frugality means overprotective of your money which prevents risk-taking while overspending means financial leakages and unnecessary bad debts.

Their financial life has no planning and they have never taken a conscious effort to straighten it out. Their finances are all lumped into a “pot” which is meant to be used for everything.

They do invest but usually due to either lack of knowledge or fear of losing their capital, the amount is too small to be financially significant. Their insurance coverage depletes as medical costs rise, unsure what and for how much they are insured for.

It really doesn’t have to be this way. There is a way to change your financial situation. The first step is to decide to be financially responsible yourself. Acquire the right financial knowledge and make that change. Find a financial buddy to help you get started.

- Financial Snacks by Joyce Chuah, CEO of Success Concepts Life Planners

So you need more money ... 

The problem always starts when you owe more than what you can earn, financial experts say.

When it comes to money, Adrienne Wong (not her real name) believes she is a reasonable spender.

An assistant communications manager, Wong, 31, earns about RM8,000 a month, but says her debts take up a sizeable chunk of her monthly income.

The two biggest items in her list, her housing and car loans, amount to about RM3,000.

“My credit card bills usually come up to another RM1,000 plus, so that’s more than half of my salary gone. With utility bills, that’s another RM600. The rest goes into savings, pocket money for my parents and a bit of shopping.

“With property and car prices as high as they are now, it’s no wonder our loan amounts are so big. But what choice do we have?” Wong asks.

Indeed, the rising rate of household debts is a pressing concern – as of March, this year, the Malaysian household debt ratio against the GDP reached an all-time high of 83%.

Last week, Bank Negara Malaysia (BNM) announced a three-prong approach to curb the rising trend of household debts:

> Maximum tenure of property financing is now fixed at 35 years;

> Maximum tenure of personal loans is fixed at 10 years;

> Prohibition on the offering of pre-approved personal financing products.

BNM Governor Tan Sri Dr Zeti Akhtar Aziz had said that Malaysia currently has the highest household debt to GDP for a developing country in the region. In comparison, Thailand’s household debt ratio stands at 30%, Indonesia at 15.8%, Hong Kong at 58%, Taiwan at 82%, Japan at 75% and Singapore at 67%.

Countries that have higher household debt to GDP are the United States at 91.7%, United Kingdom at 114%, Australia at 113%, New Zealand at 91%, and South Korea at 91%.

RAM Holdings Bhd group chief economist Dr Yeah Kim Leng says BNM’s move is a “prudent one”.

“A financial crisis can always be traced back to excessive borrowing or leveraging, and the problem is that we never know we are in a credit bubble until that bubble bursts.

“The higher this figure is, the more vulnerable the household sector will be to economic shocks, which can come in the form of an economic downturn,” he says.

The concern, he says, is when people owe more than what they can earn, which is not sustainable.

According to BNM figures, the three biggest contributors to Malaysian household debt are the housing, car and personal loans (refer to chart).

Personal loans can be used for a variety of reasons.

Teacher Siti Norsharmi Fateh Mohamad, 28, says she took a RM35,000 personal loan three years ago to fund her wedding.

“We wanted our wedding to be special, with everything done up nicely. It didn’t feel like much then, but now that we have more commitments (a daughter and a housing loan), it’s definitely an additional burden for us.

“On hindsight, we shouldn’t have taken the personal loan ... it wasn’t a necessity,” she says.

But personal loans are popular lately and there’s a reason for it.

“Banks aggressively push personal loans because it’s one of the most profitable products for them. Interest rates for personal loans can be anywhere from 3% to 12%,” says a former local bank manager who declined to be named.

Spending trends have also changed, says Dr Yeah.

“Previously, people only spend what they can afford, but practices have changed. Today, many people don’t mind spending money they don’t have.

“Taking a personal loan is not necessarily a bad thing, but it depends on why you’re doing it. Taking a personal loan for education, for example, is fine, because you’re improving your skills ... or for medical purposes to enhance one’s health. But to take a loan for conspicuous consumption, or to make speculative ‘investments’... I think that should be discouraged,” he says.

Credit Counselling and Debt Management Agency (AKPK) chief executive officer Koid Swee Lian agrees.

“It is quite common now for people to take personal loans prior to a festivity because they want to buy new furniture, change their curtains, do a bit of renovation.

“Consumers must be discerning and responsible in their borrowings, just as credit providers must be responsible in their lending. Earn before you spend, not spend then earn! Use the debit card and not the credit card if you cannot pay in full each month,” she says.

Before taking a loan, Koid says consumers should ask themselves:

> Do you really need the personal loan?

> Is it for a productive purpose or can you forgo it?

> Can you afford to pay the loan instalments? If the interest rate increases, can you still pay the increased loan instalments?

> If the loan is for a productive purpose, would you generate enough income to repay the loan and leave some income for yourself?

If taking up a personal loan is absolutely necessary, Koid advises potential borrowers to do their homework and compare the different bank rates.

“Go to bankinginfo.com.my where you can make a comparison of all the rates. Don’t take a loan just because it’s offered. Also, understand what you’re signing up for. Find out whether the bank is charging you a flat rate, a reducing rate or a floating rate,” she says.

Koid gives an example of a loan with these terms – a RM10,000 loan to be paid over five years at 4% interest rate per annum.

“A flat rate of 4% for a five years may not sound like a lot, but what it actually means is that you’re essentially paying 20% interest for the five-year loan. The amount of interest you pay doesn’t change regardless of how much you’ve repaid,” she says.

“Compare this to a reducing rate. If you’ve paid RM1,000, that means the interest should only be on the remaining RM9,000.”

Those who have trouble managing their cashflow can also seek help at AKPK or call its toll-free line at 1800-88-2575.

“People who have a debt problem often feel very embarrassed, but I think they need to be realistic. You’re in that situation, you have to solve it. Come to us, we will do our best to help you,” Koid says.

BY LISA GOH  lisagoh@thestar.com.my

Play safe on the mobile, secure your devices!

All a sinister person needs to do to spy on you is to simply penetrate your smartphone or tablet.

OF late, spying has been a household word after revelations of Prism, a clandestine mass electronic surveillance programme operated by the United States National Security Agency (NSA), by former NSA contractor Edward Snowden. 

But one does not need an entire state programme to spy on someone.

All that a sinister person needs to do is to penetrate their intended victim’s smartphone or tablet. Which is quite an easy thing to do, actually. One of the common methods used is spyware.

Such spyware can easily be found by searching on Google although they are usually not free.

There is a possibility that consumers might download spyware from an identified party or an unknown source accidentally. - Goh Chee Hoh

This is what happened when a husband in Singapore suspected his wife of having an affair. On the pretence that his phone was not working, he borrowed his wife’s phone to make a call but instead installed a spyware app.

The husband was then able to see the calls made (but not hear the actual conversation), messages sent and her location at that point, from a computer using a Web-based application that communicated with the app.

When the information confirmed that she was having an affair, he continued to monitor her phone for some time before posting the information online, including the messages she sent to her “lover”. He did not reveal any personal details about themselves but this is how the news became public.

However, many have questioned the authenticity of the story, with some brushing it off as a publicity stunt to sell the spyware app.

Nevertheless, it pays to be safe, as there are apps that can do such things and they are easily obtainable from the Web.


“Mobile phones are an integral part of consumers’ lives, with two thirds of adults worldwide reporting that they use a mobile device to access the Internet,” says David Hall, senior manager of regional product marketing for Norton at Symantec Corporation.

“As we use our mobile phones in new and innovative ways, we’re also putting sensitive information at risk.”

“Spyware is a type of malware (malicious software) that logs information and then forwards that information from your device,” explains Rob Forsyth, director for Asia Pacific at Sophos Ltd.

Usually, such spyware is capable of operating quietly in the background so it can easily go unnoticed by an unsuspecting device owner.

“For a regular user, it is very difficult to figure out that they’ve been infected,” says Goh Su Gim, security advisor for Asia Pacific at F-Secure (M) Sdn Bhd. “There’s no obvious signs.”

In fact, it may surprise you to know that such threats could actually come from a source that’s known to you.

“There is a possibility that consumers might download spyware from an identified party such as their spouse, friends, colleagues, business associates or from an unknown source accidentally,” says Goh Chee Hoh, managing director for South-East Asia at Trend Micro Inc.

As an example, he describes a mobile phone monitoring service which uses Nickispy, a family of viruses that attacks Android devi­ces). It is said to be capable of monitoring a mobile user’s activities and whereabouts. The Chinese website which offers this service charges subscribers fees costing US$300 to US$540 (RM900 to RM1,620).

“This spyware sends MMS to the victim’s mobile device. Once the MMS is downloaded, the cybercriminal is granted access to your line of communications,” Chee Hoh says.

This security issue is further compounded in cases where a consumer uses the same device for both work and personal purposes.

“From a personal user’s standpoint, one can experience loss of privacy whereas from a business perspective, an organisation may lose sensitive data which can lead to loss of revenue,” he explains.

Had such an act been committed in Malaysia, it would go against Section 231 of the Communications and Multimedia Act 1998. Using an app to obtain information from another person’s phone can land the offender a RM50,000 fine or a prison term not exceeding two years if convicted.

The Malaysian Communications and Multimedia commission (MCMC), our multimedia industry nurturer and regulator, also said that it does not act alone when pursuing offenders.

“We look at each case individually and help other agencies like the police, for example, when upholding the law,” said Sheikh Raffie Abd Rahman, MCMC head of strategic communications.

By SUSANNA KHOO and ZAM KARIM
bytz@thestar.com.my, The Star/Asia News Network

Simple safeguards to keep your devices secure

While the mobile security and privacy threats remain very real and imminent, the steps to prevent such problems are really quite straightforward and easy to do.

Following are some practical tips, courtesy of security specialists Symantec Corporation, Sophos Ltd, Trend Micro Inc and F-Secure (M) Sdn Bhd, that you should take note of:

1. Use your device’s built-in security features 

Configure your security settings so that functions such as location sharing are disabled and passwords are not saved but need to be manually keyed in each time.

You can also make your device more secure by activating its lock function and requiring an identification action such as a fingerprint scan, keystroke pattern, numeric PIN or alphanumeric password in order to access the device.

2. Use strong passwords and secure Internet connections

Unique and strong passwords will help prevent valuable information from being stolen from your device. Using a different password for each and every app would be best but you would need to ensure that you have a good way of remembering those passwords if you choose to go this route.

Avoiding open and unsecured Internet connections such as free public WiFi will also reduce risk of online threats on your mobile device.

3. Never jailbreak or root your device 

Use your device as recommended by the manufacturer instead of modifying the version of the iOS or Android operating system that has been installed. This is usually done to install pirated games and apps for free but this makes it easier for spyware to operate on your device.

4. Be cautious when choosing and installing apps

It’s a vast universe out there in the World Wide Web and, at times, it’s hard to tell the good guys from the bad ones. It therefore pays to be extra careful when downloading apps from the Internet. If something is too good to be true, it probably is. Do background checks on developers if you need to be sure, and scrutinise an app’s ratings and reviews as well.

It’s also a better idea to download apps directly from the Google Play Store for Android devices rather than from third party websites since downloads from some of these sources may contain malware.

Do have a close look at the Terms and Conditions as well as permissions requested by an app prior to installing it, as you don’t want to unknowingly allow developers to track and collect personal data which is unnecessary for running the app.

5. Scrutinise notifications and services running on your device 

Stay alert whenever you receive any notification on your device. Some may contain malicious links or cleverly trick you into submitting personal information to cybercriminals.

Also, pay special attention to services running in the background on your device that seem unfamiliar or strange. You will have to refer to online guides on how to check, as it differs among devices.

The principle of “when in doubt, throw it out” could help save you a great deal of trouble later on.

6. Log out immediately

This is especially crucial for social media apps where the chances of your data being misused are higher. Make it a habit to log out of such apps and re-enter login information each time you use them.

7. Stay up-to-date

Take time to pick out a preferred mobile security software and install it on your device. Make sure to constantly update it, and don’t forget to check for updates for all your apps and to install any available patches for your device’s operating system as well. Set up routine scans for your device, and review the logs each time a scan is concluded.

By Susanna Khoo
bytz@thestar.com.my ,The Star/Asia News Network

Related posts: 

1. Upset over US cyber spying!
2. US Spy Snowden Says U.S. Hacking China Since 2009
3. US building new spy wing to focus on Asia

Let children be children

Parents have to be more cautious and keep a close eye on their kids to protect them from negative influences.

Naughty teddy: A scene from Ted. Despite featuring a cuddly teddy bear, this is not a movie you should expose your kids to.

AFTER a hectic couple of weeks full of shows, I spent last weekend celebrating friendships, both old and new. I had a massive BBQ party for friends who had helped in preparing for the shows and projects to thank them all for their support, friendship and big hearts. The party was also a farewell of sorts for a wonderful and dear old friend of mine.

Due to my busy schedule, I’ve been missing out on much needed quality time with the important people in my life. As with all parties, not everyone was able to make it, but this didn’t prevent me from having a blast. It was fantastic to see everyone enjoying themselves, chatting, drinking and eating. Of course, saying farewell to my dear friend was quite heart-wrenching, but we still managed to share many laughs. Even my children enjoyed the evening playing with their old friends and making new ones.

Aside from the usual party banter and gossip about people we knew, lots of memories were relived; we caught up with current news and just generally had fun. One topic that seemed to dominate the evening was how fast our children were growing up. This got me wondering, whose fault is it really? Is it because of the advanced technologies they are exposed to these days ... or rather the fault of parents?

I have heard horrifying stories of under-aged children – sometimes as young as 12! – who are having sex, often without protection, and their parents are OK with this behaviour. Some European friends say this is pretty common for them. In fact, research has shown that over the past 50 years, the number of teenage girls who are sexually active has quadrupled! Unfortunately, this kind of behaviour is no longer contained within the West and becoming more rampant even here in Asia. Personally, I cannot begin to understand this but it seems more people have begun to accept that it is normal for teens to be sexually active.

A while back, I was watching a documentary about traditional weddings, which highlighted arranged marriages involving children, especially among minority tribes. This documentary shared the story of four sisters who got married at the same time, the youngest of whom was only four! According to some traditions, if a boy of that age isn’t married yet, he will bring shame to his family. It’s sad to think that this practice continues to exist in this day and age.

I know for a fact that my grandparents had an arranged marriage. Grandma used to tell me how many of her friends back then were arranged to be married even before they were born. But circumstances were different then.

I guess in certain communities where marriage is seen as economic security for girls, things are different. But in societies like ours, where girls have every opportunity to create their own financial security, children are still maturing too quickly. And I feel both parents and technology have played a role.

Technology has become so accessible, allowing kids to be exposed to sites they shouldn’t be viewing. And parents are not monitoring what their children view online. I have even heard of parents watching pornographic movies in the same room as their young children! Children these days are smart and they learn fast.

They are also impressionable, and being exposed to this sort of film would make them think this behaviour is acceptable and that it’s okay for them to imitate it. Scary!

Even movies these days expose young children to unsuitable words and images. Stories that seem innocent enough for young kids are often laced with topics that are too mature for them. Take the movie Ted, which was released not too long ago. I actually contemplated taking my children to watch it because I was under the impression, from the posters that I had seen, that it was simply about a young boy and his teddy bear.

Luckily, I went online to check out the trailer and reviews. The movie was full of obscenities and actions that I definitely would not have wanted my young children to watch.

So, yes, in a way the Internet is great as it allows us to access useful information so much easier and faster. However, if not used properly, it can open Pandora’s box of elements we want to keep away from our kids. I was told by a friend that even adding filters to websites is not completely fool-proof. There seems to be no way around this one – we are living in a very advanced world where all sorts of data, including the unsavoury kind – have become very accessible. This makes the world a very scary place indeed, especially in terms of young children and teenagers.

Even TV channels, such as MTV, present girls in revealing clothes and seductive dance. Too many little girls will therefore think that dressing and behaving in that fashion is “cool”. It makes me sick when I see so many girls these days acting much more mature than they are. I also feel sorry for our children, the future leaders of our world, to have been injected with such unnecessary images in their heads from such a young age.

I’m not sure how we can help change this world to be a better place for our children. It will definitely be a tough mission, but it’s vital that we try anyway. We just have to be more cautious and keep a close eye on our kids’ daily activities to protect them from negative influences.

It’s important that we show them happy movies and stories, and preserve their childhood for as long as possible. Childhood is the most carefree and happy time they will ever have. Let’s not rob our children of this wonderful, innocent experience.

It really is difficult being parents today, but we can only try.

 Mel’s Place by MELINDA LOOI

Award-winning fashion designer Melinda Looi tries to marry consumerism and materialism with environmental consciousness, and believes her greatest creations are her children. Follow her on Facebook or write in to star2@thestar.com.my.

China's Lenovo overtakes HP as global No 1 PC maker

PALO ALTO (CBS/AP) – Lenovo beat out rival Hewlett-Packard to become the No. 1 PC maker by a narrow margin, according to both firms.

In the Asia/Pacific (excluding Japan) region overall PC shipments in the region fell slightly below forecast due to China. Weak sell-in to China during April and May constrained shipments. Although June shipments in China improved, expectations for the third quarter are being lowered to reflect remaining inventory as well as economic pressures.

Worldwide shipments of personal computers fell 11 percent in the April-June period, according to data from research firms Gartner and IDC, as people continued to migrate to tablets and other mobile devices.

Gartner Inc. said Wednesday that the PC industry is now experiencing the longest decline in its history, as shipments dropped for the fifth consecutive quarter. Computer makers shipped 76 million PCs in the April-June period, down from 85 million in the same  three months of 2012, according to Gartner.

International Data Corp., which uses slightly different methodology, essentially came to the same conclusion, though it noted that the decline was slightly smaller than expected.

“With second quarter growth so close to forecast, we are still looking for some improvement in growth during the second half of the year,” said Jay Chou, senior analyst at IDC, in a statement. “Slower growth in Europe and China reflect the risks, while the improved U.S. outlook reflects potential improvement.”

Gartner’s Mikako Kitagawa said inexpensive tablets are displacing low-end computers in “mature” markets such as the United States. In emerging markets like China, meanwhile “inexpensive tablets have become the first computing device for many people, who at best are deferring the purchase of a PC. This is also accounting for the collapse of the mini notebook market,” she added.

IDC said the numbers “reflect a market that is still struggling with the transition to touch-based systems running Windows 8.”  Microsoft Corp.’s latest operating system launched in October and sales have disappointed analysts. But Kitagawa said that while “Windows 8 has been blamed by some as the reason for the PC market’s decline, we believe this is unfounded as it does not explain the sustained decline in PC shipments.”  - CBS, AP, AFP

Related post:
Tianhe-2, Chinese supercomputer named as world's fastest

Son, mum in bloodshed by wife, her daughter-in-law !

Injured: Lim and her son Liew Pang @ Low Pang after they were allegedly assaulted.

KLANG: An old woman and her son ended up with head wounds so bad they needed to be stitched up. Both alleged that they were attacked by the son’s wife with a metal spatula.

And the fight was over joss paper.

It all started when Lim Kae Poy, 67, went to her 31-year-old daughter-in-law’s condominium in Bandar Baru Klang on Saturday, to collect schoolbooks belonging to her grandson.

“As soon as I entered, she accused me of stealing joss paper from the living room and threw a metal can at me but I dodged it,” she told reporters yesterday.

“She then hit me on the head with a metal spatula.”

Lim managed to get away and fled to the Bandar Baru police station to lodge a report, but the policemen took her to the Tengku Ampuan Rahimah Hospital because she was bleeding profusely. She needed five stitches on her head.

Battered duo: Liew and his mother Lim received five stitches each following the attack.

Her son, Liew Pang @ Low Pang, 37, who had earlier tried to break up the fight, was also allegedly whacked on the head by his wife.

He stayed back in the condominium when his mother fled, in order to restrain his wife.

Liew later sought treatment at a clinic. He too needed five stitches to close his head wound.

He told reporters that when he went to lodge a police report the following day at the Sungai Kapar police station, he was instead detained for four days.

The police told him his wife had reported earlier that he had beaten her up.

North Klang OCPD Asst Comm Shukor Sulong confirmed that police reports have been lodged by all three.

By TEH ENG HOCK
newsdesk@thestar.com.my/Asia News Network