Recently, my Paypal withdrawal limit is increased from a daily limit of USD 500 to USD 2500. Here’s how I found out.

Before this, Paypal user in Malaysia can only withdraw money to US bank account. Of course, this was too troublesome for most user. At that time, I would transfer my Paypal balance to my Singaporean friend. He would then transfer to his Singapore bank account and pass it to me in cash. I would have to convert the Singapore dollar to Malaysian Ringgit again.

This involved two fees. Firstly, Paypal would convert US dollar into Singapore dollar at 2.2% lower than market rate. Secondly, I had to bear currency exchange cost to convert Singapore dollar to Malaysian Ringgit.

Later, Paypal user in Malaysia are allowed to withdraw to credit or debit card bearing VISA logo. This is of course a great news to us. So I immediately applied for a Maybank debit card. Unfortunately, I couldn’t withdraw Paypal balance to Maybank debit card when I tried. Later I found out Maybank debit card currently doesn’t accept online transaction.

Therefore, I withdraw to my Maybank Visa credit card instead. Unfortunately (again!), the withdrawal limit was only USD 500 per day with a service fee of USD 5 per transaction. At USD 500 withdrawal, the service fee will be 1%. This is also quite high, but much lower than withdrawal to Singapore bank.

I have withdrawn Paypal balance this way for several times without any problem. I took about 3 to 5 days for the amount to clear. I can easily check it online using Maybank2u.com service. As the USD-RM rate goes up and down, I will get different amount for each withdrawal. Sometimes, I would wait for the exchange rate to go up in my favor before making the withdrawal. But when the rate goes down, I would withdraw it quickly.

Paypal statement showing withdrawal to Malaysia credit card

Maybank statement showing Paypal withdrawal

(Note: The amount above is not pure profit.  A big chunk pays for the cost of goods.)

I was used to this USD 500 limit I would key in USD 500 everytime I make the Paypal withdrawal. Entering anything more than UDS 500 would result in error. But on one particular day, I tried to enter about USD 700 out of curiousity. To my surprise, I was allowed to proceed to the next step.

Hmmm… has Paypal lift the USD 500 limit?

So I cancelled that transaction and waited for my Paypal balance to reach USD 1000. Then I tried to withdraw about USD 1000+. I could proceed to the next step too. This is great! I can finally withdraw more than USD 500 at one time. This greatly reduce the withdrawal service charge. At USD 1000 withdrawal, the USD 5 fee is only 0.5% of the total amount. At USD 1500 withdrawal, the fee is only 0.33%.

Finally, I ended up withdrawing USD 1800 as shown below.

New Paypal withdrawal limit for Malaysia

(Note: The ‘Name on Card’ shows my company name instead of my name. I was worried of this but there is no problem.) 

The transaction was successful. And it reminded me of the elephant story as follows.

“At a circus, trainer would tie baby elephant’s leg with a big metal chain. As a wild animal, baby elephant would kick and drag her leg with all its energy to get free. But each trying only wounded her leg badly. And with each try, the baby elephant used less and less energy. Finally she gave up trying. After the elephant grew up, the trainer only tied her leg with a small rope. The adult elephant could now easily break free with a gentle kick. However, she gave up long time ago because she had failed many times before. So what restict the elephant’s freedom? The tiny rope tied to her leg or the big metal chain in her mind?”

For my case, I was so used to withdrawing USD 500 that I didn’t realize the limit was increased until I tried entering a bigger amount. However, I received an email from Paypal several days later mentioning about my increased withdrawal limit. Here’s the extract of that email:

Dear Pang Chow Ping,

As a valued seller, we are contacting you about a recent improvement
that we made to your PayPal account.  Your withdrawal limit to your
Visa® debit/credit card has been increased from US$500 to US$2,500 (or
equivalent) - giving you faster access to your funds1.

We hope that you’ll enjoy this enhancement!  Thank you for continued
business!

Sincerely,
The PayPal Team

1.      The new limit is per withdrawal to your Visa® debit/credit card.
Additionally, your account was selected for this enhancement based on
your recent transaction and account history with PayPal and is subject
to periodic review.

At first, I thought every Paypal user in Malaysia get this withdrawal limit increase. But with this email from Paypal, I realized only certain seller are entitled for this withdrawl limit increase. Maybe my transaction amount meets their minimum requirement. However, the foot note says it is subjected to periodic review. Anyway, I certainly welcomed this improvement as I can reduce my transaction cost

• Deposit your money in saving account
• Put it in fixed deposit account
• Hide it under your pillow

The above methods are easy to do. But your return can barely cover inflation rate. That means your buying power reduces every year even after adding in the tiny interest earning.

You can also invest in stock or property. But it takes time and money to really acquire the knowledge of investing in these two popular investment vehicles. Of course, you can get a higher return. But if you don’t know what you’re doing, you may risk getting hurt financially.

So where can you keep your money for significant return without too much risk?

Welcome to the investment world of mutual fund or unit trust. This investment shouldn’t sound strange to you as it has existed for quite a long time. I’ve heard of mutual fund for many years before really going into it.

It started when my family and relative wanted to invest some money into Public Mutual Fund (Malaysia). So I thought why not apply for a unit trust consultant and become their agent. I can also invest for myself at a discounted service charge.

From the compulsory unit trust seminar for agent, the information I previously knew about mutual fund finally make sense to me.

Basically, mutual fund is an investment pool managed by a qualified fund manager. The manager will invest in stock, bond or other money market instrument according to their fund objective and characteristic. The advantages of mutual fund are:

• diversification – reduce the risk of  dropping investment value
• professional management - fund maintained by qualified fund manager
• low entry amount – you can start to invest from as low as $1000, with monthly contribution of $100 or above
• ready access to fund -  manager buys back your fund anytime you want to sell
• lower investment costs

Different types of mutual fund

Mutual fund is further divided into various types with different investment strategy. The basics are:

• equity fund – invest primarily in stock market : higher return but more volatile
• bond fund – invest primarily in bond market : lower return but less volatile
• balanced fund – mixture of equity and bond fund – return and volatility in between equity and bond fund
• money market fund – invest primarily in low risk money market instrument : lowest return and risk

You need to choose the fund type that suits your specific investment objective. If you’re a young person with plenty of time to see your investment grows, invest more in equity fund. After 5 years, you should see significant earning even with the high volatility of equity fund.

If you’ve retired, cannot withstand high volatility or need your money in near future, you should invest more in bond fund instead. This fund type is more stable but with lower earning of course.

If you’re in the middle of the two situations above, choose balanced fund instead. Money market fund is usually not recommended due to its very low return. However, you may use it to park your money temporarily while waiting for better investment opportunity.

Mutual fund investment strategy

Besides choosing the fund type according to your investment needs, you can invest in different fund type according to market condition for higher return and lower risk.

Basically, when the stock market goes downward, the price for equity fund goes down too. This is a good time to invest in equity fund for good earning when stock market recovers again. Most people are afraid to invest when the price goes down. By buying fund from reputable mutual fund company with good track record, you should be doing fine.

In reverse, when the stock market gets too hot and shoot up too high, you should be careful. If you realize most stock is overpriced, you should invest in bond fund instead. If your previous equity fund’s price goes up a lot, you can lock in your earning by switching your equity fund to bond fund.

Basic mutual fund investment mentality

Investing in fund from reputable mutual fund company can be rewarding for your long term investment needs. You get the opportunity to get higher earning while minimizing your risk. It is an almost no brainer investment process. Even opting for fixed monthly contribution in a particular fund can give satisfactory return in the long term.

Here are some basic investment mentality you should know:

• The price of your mutual fund goes up and down according to market condition. This is normal. Don’t be too sad when the price suddenly drop. And don’t be too happy when the price shoots up high. Think long term. Basically, 3 to 5 years should even out any market volatility and let you see some profit.
• Don’t expect to earn a lot of money in a short time. Treat investing in mutual fund as a saving process. You should see significant earning over the long term.
• Don’t be afraid to buy when the price goes downward. This is often the best time to buy for good profit. If you invest in a company stock and it goes bankrupt, you may lose all your invested money. But with mutual fund, you won’t see your invested money shrink to zero due to its diversification strategy. A fund may invest in hundreds of company stock.
• Don’t buy and sell your mutual fund within a short period. This won’t go any good for long term due to the initial service charge you need to pay. Once again, mutual fund is not for opportunistic investment to get quick gain.

With good discipline, you can invest successfully in mutual fund to meet your investment objective. Remember not to keep too much money in saving or fixed deposit account. High inflation rate will kill your tiny earning in those deposits. A good start to open up your world of investment will be mutual fund.

Happy investing

Several years ago, I did wonder about this question. As a design engineer, I had a nice salary. And I got double salary amount when I was temporarily transferred to China to work. However, I realized my year end bank account total was still the same as the beginning of that year. In another word, I spent whatever I earned in that year.

Of course buying what I liked was nice. But financially, I stayed stagnant for a year. And this didn’t sound good. Having the same experience? What can you do about it?

About 4 years ago, my friend handed me an audio CD collection titled “Prosperity consciousness” by Fredric Lehrman. It stressed on how your thought and subconscious affect your prosperity. What happen in your past may also prevent you from attracting more money. This is also the basic principle of DLC which helps to resolve past issue to improve current condition.

Fredric suggests having 4 saving accounts to train your mind to attract more money. I follow his system and like it very much. Here’s how it works.

Account 1: To keep your money for long term. You cannot withdraw it for any reason. This trains your mind you have the money and you don’t need it (you’re prosperous).

Account 2: To keep your money for investment use. If you have difficulty finding money to invest, it is from this account. This account lets you cultivate the habit of investing.

Account 3: To keep your money for earning interest. This trains your mind you can create passive income from your money. Later, withdraw the interest you earn and spend it on your tea break or meal. Relax and enjoy that moment. Remind yourself that you created that money automatically.

You may earn a few dollars from interest in the beginning. Don’t worry about that. Just use it to buy sweet, bread or anything within budget. The most important thing is the process of training your mind. As time pass by, your interest will get higher. By then, you can enjoy a fancier meal and even treat your friends too. I’m sure you will look forward that moment.

Account 4: To keep your money where you must spend it on anything you like. This is the account I like most You don’t have to spend it every month. You can accumulate the amount for a few months and spend it all at one shot. And when you happen to see something you like in a shopping mall, just buy it using the money in this account. But don’t use it to pay for your monthly bill. Use it to buy something special where you will enjoy owning it.

Before this, you may find something you like and think “I cannot afford it”, “It’s better not to spend money on this” or “If I buy this, I’m afraid I don’t have enough money to cover this month expenses.” This creates negative impact on your prosperity since you’re telling yourself you don’t deserve it or you cannot afford it.

Therefore, this account trains your mind to enjoy buying what you like. It lets you truly enjoy the fruit of your labor.

How to fill in these 4 accounts?

Actually, the process is pretty simple. When you receive your monthly salary or income, here is the first thing you must do. Take out 10% of it and distribute it evenly among these 4 accounts. For most people, living off with 90% of their monthly income shouldn’t be a big problem.

Of course, you can also allocate more than 10% of your income to these 4 accounts to fill them up faster. You can choose 20% and even 50% if you want. Just be discipline and do it every month. This is what we call “pay yourself first”.

My experience 

I actually don’t have a high salary. And my other income sources are inconsistent. So I started my 4 accounts with $50 per account monthly. Later, I increased it to $100 per account, saving $400 monthly.

And now, 4 years later, I’m happy to say I have $3000 in each of my 4 account. But the Account 4 for spending has only $1000 since I’ve spent some. Have I not started these 4 accounts, I might not see this amount of money in my account today. With this system, I have the confidence my money can continue to grow every year. And I get to invest it, spend it, keep it and enjoy its passive income.

Isn’t it time to start your own 4 accounts?

I looked at that RM50 note though ceiling light. No watermark of our King. Great, I got a fake RM 50 note!

Guess which one is fake

At a glance, this fake RM50 note looks very similar to the real note. The King image and background are hard to differentiate. The vertical security hologram strip on the right looks exactly the same. The top  RM 50 note in above photo is the fake one.

It is amazing that this fake note even has the “50″ mark in the middle checker image when I tilt the note. And UV light also shows the short and random strips all over this fake note. Looks like counterfeiting technology is getting more advanced.

Perfect security hologram but smudged printing - right RM50 note is fake

On a closer look, we can see some flaw with this fake note.

The “RM 50″, “LIMA PULUH RINGGIT” and ”BANK NEGARA MALAYSIA” wording look like being printed by inkjet printer. Smudge can be seen around the outer line. The wording in original note feels extruded with some texture. But for the fake note, it feels flat all over the surface.

The most obvious flaw - right RM50 note is fake

This is the most obvious flaw of this fake RM50 note. There is no watermark although we can see some shadow of the King. Note the fake note even has transparent “BNM RM50″ wording on the vertical strip.

Poor printing at the back

At the back, the fake RM50 note (on top) has poor and blurry printing. The silver vertical strip also looks worn out.

Overall, this fake note feels quite thick. However, our original RM50 note also has different thickness. So it is quite hard to tell the difference by thickness alone. I also find it hard to differentiate the fake note by its surface feel. It feels about the same as original note. This fake RM50 note is much more sophisticated than the fake RM100 note I got last time.

For this fake note, the easiest way to tell is to look at the watermark. Hmm… maybe I should calculate my money by pointing it upwards toward light. Well, I think it’s time to get a money detector for my shop.

My credit cards

Currently I have 8 credit cards. And these exclude the HSBC and OCBC card I’ve just canceled.

When someone has so many credit cards on hand, it can only mean 2 things. Either he is creating a financial disaster or he is excellent at managing money. Lucky for me, I’m not having a financial disaster

Today, applying for a new credit card is as easy as filling in a form. With a credit card on hand, you can use it to apply for other cards easily – without any salary or income tax slip. And this creates a big problem for many people at managing their financial.

However, bankers and merchants love it. The banker smiles broadly when they earn such a delicious interest (1.5% monthly) on unpaid balance, not to mention the RM5 late payment charge as dessert. Even if you fully pay your outstanding credit card balance every month, they also earn some percentage of your spending. But these are what they should get for providing us credit service and carrying some risk of default payment. No complain about that. No one force you to use their credit card.

For the merchant, accepting credit card means higher sales. They get higher profit even after deducting their credit card charges. Can you see the smiling faces everywhere?

What happen to consumer like you and me?

Personally, I think handling a credit card is too tough for most people. It gives you freedom to spend on things you don’t need and spend more than what you should. Credit card gives you more choices. And this is a two-edge sword. Most people bleed themselves financially with this cute little card.

Well, the problem is not the credit card. The problem lies in the user, which are you and me. Do you want a credit card for your convenience? Or do you want it to mess up your financial life?

I have a few friends who swiped their credit card until it exploded (reaching the limit). Actually they were having a well paid job. But eventually they had problem paying off their credit card debt.

Here are some tips to use credit card wisely:

• Make sure you have money (in cash or bank) for your purchase before you swipe your card.
• Ignore the card limit amount given to you. Follow your own monthly spending limit instead.
• Don’t buy something just because you can (with your credit card)
• Don’t upgrade your purchase to higher priced item just because you can pay with your card.
• Try not to use installment plan even it is interest free. You will easily think you have more money in your bank although a portion of it has to pay for future installments.
• Finally, pay off all your outstanding balance every month! The interest is 1.5% per month, which is more than 18% compounded interest per year. Unless your credit card purchase can generate more than 18% per year, you’re digging a financial hole if you let your bank charge this high interest rate.

Some people are actually afraid of using credit card. They worry uncontrolled credit card spending will mess up their financial life. However, if you can control yourself, there are several advantages of using credit card such as:

• Convenience – you don’t have to bring so much cash
• Transaction statement – you can monitor your spending in a tidy statement
• Extra point bonus – you can redeem some free gift from your points (but don’t spend for the sake of point)
• Extra discount – some utility company such as mobile phone company gives additional monthly rebate on credit card auto billing
• Internet purchase – most online company only accept credit card as payment method
• Free gift upon application – some credit card company give free gift or cash rebate for new application

How I end up with so many cards

1. I first applied for Hong Leong credit card for its free-for-life promotion. At first the credit limit was RM 5000. But now it is RM 28,000 after using it for around 5 years. However, Hong Leong bank’s online banking is very poor. I need to log in twice in 6 months (if I’m not wrong) to keep it active. If not, I have to call their call center to activate it again. How troublesome!
    
2. Then I got a CIMB card for my company health product purchase. We can get 1% cash rebate for purchase from our head office and 0.5% cash rebate for other purchase. Credit limit was RM 5000. But since I swiped a lot for my company product purchase, the card limit gradually increases to RM 18,000. CIMB Bank online banking system is average. I use it to check my available credit balance.
    
3. I later applied for Senheng’s RHB PlusOne card for extra 1 year warranty for Senheng electrical and electronic product purchase. There is also cash rebate to exchange for Senheng voucher. Why not? Credit limit was RM 5000. Now is RM 6000.
    
4. Later, my wife helped me to apply for a Citibank card because she just applied one. Using the CIMB card for application, I get a high credit limit of RM20,000 straight away. However it was troublesome to send check for monthly payment.
    
5. My wife was using OCBC credit card and got a recommend-a-friend promotion letter. So I applied it and got RM50 cash rebate and a clock as free gift. Credit limit was RM 5000. I swiped once for RM5000 and later canceled it to avoid annual fee.
    
6. I was at a shopping mall when I saw HSBC booth. I applied it to take advantage of its 3-month interest free balance transfer. Credit limit was RM 18,500. At that time, our head office announced a 10% price increase for all health products. So I bought a many products as I can to keep stock. All my credit cards were “exploded”. When credit card statements came in, I transferred RM 18,500 to HSBC card and paid off the remaining balance. After 3 months when our company got some cash back, I paid off the HSBC card. My calculation was correct and no interest was charged on any card. Then I canceled the HSBC card to avoid annual fee. I found out on a few occasions that HSBC customer service is quite poor. They made a big mistake on my balance transfer amount. They even sent a statement for annual fee of my wife’s card even though it had been canceled for several months.
    
7. When I was in Citysquare shopping mall in JB, I saw Eon Bank credit card booth. I applied the Citysquare Eon Bank card to get parking discount and to use their toilet for free! But I found out Eon Bank’s credit card is the worst card I’ve ever had. I can only swipe once in the same shop, in a day. Imagine that! If you swipe once in a shop and decide to buy something else, you cannot swipe it again. My credit limit is also not shown on my statement. And I have to swipe it for 24 times in a year to enjoy the free annual fee waiver.
    
8. Again in another shopping mall, I saw Standard Chartered credit card booth. You know what happen next. The given limit is RM 20,000. However, I never used it before.
    
9. Last few months, I applied for Citibank AirAsia credit card. My sister said new successful application can get a Phillips MP3 player. But the promotion had been changed to RM 100 petrol voucher. RM 100 voucher for new application? Count me in! The terms and condition? I had to swipe 3 times in 45 days. I only swiped 3 times, got my RM 100 rebate and now waiting to cancel it.
    
10. When I had so many cards, I tried to apply for Maybank and Public Bank credit card at different time. But both banks rejected my application, which I was shocked. But a few months later, a girl from Maybank called to offer me a free-for-life Petronas credit card. I told her my previous application was rejected. But she said she can recommend me because of my Fixed Deposit with their bank. So I went on with it and got my Petronas card with RM 15,000 credit limit. I have been using Maybank2u online service for some time. It is the best online banking I know. Now I can transfer money from my Maybank account to the credit card using my computer. I also use this VISA card to transfer fund from my Paypal account.
     

Before this, I applied so many credit cards because I may need it to purchase company product when the price is increased again. However, the big price increase only happens once. So I end up with many unnecessary cards. Now I’m in the process of reducing my card.

With all my cards, I paid off the full amount every month. But on several rare occasions, I was charged late payment charge and interest when I overlooked the payment time. Basically, I’m not a big spender. Even with so many cards and such high credit limit, I dare not much because I don’t earn much.

In conclusion, credit card is a double-edge sword. If you cannot use it wisely, you shouldn’t use any. If you can control your spending, credit card provides many conveniences and extra bonuses for you.

Jack creates “something” that earns him 10 cents everyday. It may take 1 to 3 hours to create it. But when it’s completed, Jack gets 10 cents the next day, another 10 cents the day after, and so on. This 1 to 3 hour work keeps earning Jack 10 cents everyday, forever. So Jack creates one of this each day. After 30 days, Jack has 30 of these “something” that earn him $3 per day.

On the other hand, Jim finds a job with $1000 monthly salary. He works 8 hours a day for 5 days a week. At the end of the month, Jim receives his $1000 salary. The next month, Jim has to work again to get another $1000.

How will both Jim and Jack fare financially? Let’s do the math…

At the end of first month, Jim collects his $1000 salary. However, Jack only collects a total of $49.60. Poor Jack. He gets so little for the first month. Jack surely admires Jim’s $1000 salary. Now, if Jack stops creating that “something” that earns him 10 cents daily, he can only get $46.50 for the second month. So Jack continues to create one each day.

Now let’s see their monthly progress…

At the end of that year, Jim gets a total of $12000 while Jack gets a total of $6679.50. Note that for the last month, Jack gets $1085.00 which is higher than Jim’s monthly salary of $1000. That means, if Jack stops working, he still gets more money than Jim. Jack can relax at home while Jim still has to work 8 hours a day. Now, Jim really has to admire Jack for not having to work.

What if Jack still continues to create the “something” that makes him10 cents a day? Here is his yearly progress.

At the end of second year, Jack’s annual income exceeds Jim’s annual income. And after 10 years, Jack’s total earning is more than 5 times of Jim’s total earning. And the main point is, Jack can stop working anytime and still enjoys higher earning than Jim.

Now you may ask,

“Is this possible?”

Definitely!

So what is the “something” Jack does everyday to earn his daily 10 cents? It is creating website content and make money with Google Adsense advertisement. By just creating one page a day, Jack gradually build up his website  to earn lots of money in the long run.

The projected number is in theory only. It’s not that you will get 10 cents tomorrow for the web page you create today. There will be ups and downs in your earning. But on average, you will see that pattern emerging. I’m also stating a very conservative number. A lot of web page is earning more than 10 cents a day on average.

Oppsss… I forgot to let you know the number’s currency is in Malaysian Ringgit (RM). So RM 0.10 a day is less than 3 cents USD a day. It’s not very hard to get this number. When your website gets more traffic, this average amount will shoot up beyond your expectation.

So which plan do you want to follow?

The good news is, you can have both! Continue doing your job while building your website in your free time. It’s best if you can create one page everyday. The problem is…

• How long can you continue creating one web page per day?
• How long can you keep going when you don’t see good income in the beginning?
• Are you willing to learn how to build good website or blog?

As usual, you reap what you sow.

Oppsss… I got a fake RM100 note!

Find anything wrong with this RM100 note?

The real RM100 - front

Anything wrong at the back?

The real RM100 - back

This is the first time I received fake money. But then, maybe I did get some before without realizing it. Following this incident, I’ll inform my staff to check for fake note in the future. We won’t use money detector for the moment. At least we should check for the note smoothness and appearance.

For the fake RM100 I got, the difference is quite obvious. It felt especially smooth. Since our RM100 note is still made of paper, it shouldn’t be so smooth. What can you do to check this?

It’s simple. Make sure you drag your finger for about 2 to 3 cm on each note while you’re counting money. This lets you get its surface feel. Any different surface feel should get your attention.

Then, you can check for its appearance and security features. The fake note I got has several obvious flaws. Here are some of the comparison photos taken by my sister using her Nikon D80. Left photo is the fake note. And of course, right photo is the real one.

Obviously, the King is angry!

"Security seal" with key logo instead of RM100 holographic seal?

This one has watermark! Too fake however.

Security thread - no "BNM RM100"

The "100" mark seems being stamped

Flat - Braille dots are not embossed

What would you do if you have a fake note? Thoughts that may come to our mind are:

• Can the bank money deposit machine accept my note?
• Should I use it to buy something?
• Is it better to use it as one piece or use it together with other notes?

Personally, I just accept my loss and learn to be more careful in the future. If I don’t want this fake money, nobody wants it. Passing my problem to others is not a good idea.

Don’t be too sad on this loss. I just treat it as a small loss. It’s okay because more money will come to me in the future!