The Green Challenge, Round 2

2021 has ended and do you remember the green challenge that I have posted early 2021. In the year 2020, managed to "save" 50 pcs of RM 5, which let me saved RM 250. It was a fun experience and I have invited anyone who wishes to join this challenge for 2021. So, here is my Green Challenge, Round 2 report card.

In 2021, I managed to "save" 53 pcs of RM 5. This is equivalent to RM 265, which is 6% more than 2020.

It was a nice experience to have this intentional saving challenge. Now that we have saved up some ringgit RM 515, we are moving to the next step, which is to invest and let it grow. My first option to "invest" nowadays is using "Versa".

Versa (read my article on Versa here) is an alternative of Fixed Deposit, where the ringgits are put to work in the money market (short-term debts issued by bank in order to accumulate a short-term cash-pile to make up for their shortfall in their daily deposit reserve).

The great thing about Versa is that you can earn up to 2.46% of interest per annum, and the interest is credited to your account every other day.

As long as you have a smartphone that can download the app, you can sign up as a investor with a minimum deposit of RM 1 only. And if you use my referral code (X3Q3UGR8), both you and me will be able to get a bonus of RM 10 as bonus once you deposit RM 100 into your account.

How to increase your net worth in 2022

As a start, you must know what is your net worth. To calculate your net worth, you need at add all the value of your assets and minutes out all your liabilities.

Net worth = Assets - Liabilities

Method 1

The first way of increasing your net worth is to increase your assets. What are assets? Assets are things that you own that increase in value over time, or things that you own that earn income for you.

Assets that increase in value includes properties (like the home that you are staying), limited edition collectibles. Assets that earn incomes for you includes securities such as shares in publicly traded companies, fixed deposits, rental properties, intellectual properties, etc.

You can either save and invest, buy, or you can produce it yourself. As long as it belongs to you, these assets will generate some incomes for you.

• Caution: please do your due diligence before buying anything. Remember that all investments will have done risks involved.

Method 2

Another way to increase your net worth is by reducing your liabilities. Liabilities are things that you buy with credits and would need to pay back with interests. Things that you own and depreciate over time are also a type of liabilities.

Debts are what we get when we buy things in credit. And usually, we would be using credit card, personal loans, mortgages and car loans to pay for what we are buying. Eventually, we would need to pay for the credits plus interests. The amount of interests that we are paying will depends on the time we choose to pay off the credits. It also depends on the interest rate of the debts. The higher the interest rate, the more that you will need to pay for it.

So, if you have a high interest rate debt, the more you pay it down, the more you will save in interest rates. In another way, it means that you are earning more because you are paying less.

When you reduce your debts, your are reducing your liabilities and at the same time, increase your net worth.

Method 3

The third way of increasing your net worth is by saving up. By reducing your expenses, you are effectively increasing the numbers of ringgit available to invest and increase your assets. But be cautious not to overly deprived yourself by cutting off everything. Give yourselves some rewards. Reduce spending on what is not necessary but keep those that keep you moving and happy. Be truthful to yourselves on this.