I saw the papers today on property section ” My generation is becoming homeless” , its sad to hear that housing prices are increasing over the years. Many of us do work each day for that salary, and hoping we could buy a dream house. Unfortunately, a salaried worker who earn RM3,000 per month now could not afford to buy a house. Let’s see the breakdown of his salary
- Rent: RM 400 ( a room)
- Insurance: RM 150 (Full Coverage with medical card)
- Food: RM 1,200 ( RM38.70 budget for 3 meals a day)
- Entertainment: RM 200 ( Hangout with friends, mamak shop, birthday celebrations..etc)
- Mobile bill: RM 100 ( With 3G plan )
- Car loan: RM 500 ( Could drive a Perodua / Saga)
- Petrol/ Toll: RM 400 ( afford to travel to work only)
TOTAL : RM 2,950 only ( Balance RM50 for saving to buy a house ?)
Come to think of it, young working adults have to face it, they are hoping for INCREMENT and performance appraisal by their superior. So if this RM3,000 salaried worker needs to buy a house. He needs to cut down cost. Example
- Rent: RM200 ( share with a roommate)
- Insurance: RM150 ( Couldn’t cut down, do you want your insurance to pay half of your bills?)
- Food: RM 1,200 ( couldn’t cut down. Need to live. Cook at home)
- Entertainment: RM 50 (try celebrating at home, instead of mamak. Drink plain water)
- Mobile bill: RM 30 (Call/ sms only)
- Car loan: RM 400 ( Buy a used car)
- Petrol/ Toll: RM 250 ( Car pool / public transport)
TOTAL : RM 2,280 ( Balance RM 720 for saving to buy a house)
Now, it looks like a house could be possible. assuming he wants to buy a secondhand flat/apartment cost RM 125,000.
You need to save for at least 2 years = RM 17,280 (RM720 month X 12 months X 2 years). Your down payment with 10% and legal fees. After your purchase your monthly installment is RM 596 per month. Finally is affordable.
Question is, can you cut down all your expenses? Some of us can’t, Some of us can.
IF you cant cut down your expenses, try working part time jobs. We do help people to achieve their financial goals.
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