5 Ways to Earn Extra Income While Staying at Home

By Nurul Khairiah Mohamed Yusof

Seven weeks into the Movement Control Order (MCO) have brought several businesses grinding to a halt. But now, you can earn extra income while staying safe at home.

The fourth phase of the movement control order (MCO) has brought up concerns surrounding people’s livelihoods. Some are losing their jobs, companies are losing money, and many businesses are on the brink of shuttering their doors.

Although government assistance has been granted to some, many Malaysians must still strive to gain alternative income sources. Most of them are having difficulty surviving day to day, and for those with families the effort of having to meet the needs of extra people makes the whole situation harder and stressful.

According to Bank Negara Malaysia (BNM), Malaysia’s unemployment rate is expected to rise up to 4% this year compared to 3.3% from last year.

“In comparison, during the global financial crisis, our unemployment rate was at 3.7% in 2009, while during the Asian financial crisis in 1998, the unemployment rate was at 3.2%,” said BNM assistant governor, Marzunisham Omar.

With this in mind, we want to provide with you some ways to earn extra income with a side hustle, utilizing your internet connection to increase your cash flow.

 #1. Sell home-cooked meals

Now, here’s a job that’s a little bit offline while relying on being online for success. If your cooking receives so many compliments and people around you love it, why not venture into selling homemade meals from home?

With technology, it is easy to market your product. You can utilize social media to promote your baked goods or scrumptious meals. Just by using your phone’s camera and simple copywriting, you can provide a good advertisement for your business.

Get acquainted with an app like Lazada (Google Play/App Store) that allows you to sell your home-cooked meals on their platform. Several Facebook groups (just search online bazaar) also provide platforms for sellers to promote their products especially during this Ramadan’s month, when more people looking for a variety of food to break their fast.

Be aware that per our Ministry of Health’s guidelines, even food handlers for online platforms are subject to requirements and regulations. For the safety of your customers and for your legal safety, do follow these requirements and regulations.

#2. Online Tutoring

The Internet is the key during this MCO and with all schools closed, parents will need all the help they can get. If you are already a teacher then online tutoring or teaching is not new to you, but for all of you walking encyclopedias who love guiding others, this should be an opportunity to hop on. 

With the help of technology, there are no longer physical boundaries to where you can teach and learn. Tutoring is different than an online course because it is one-on-one teaching and there is an interaction between the tutor and the student.

Check out Champion Tutor, My private tutor, and Part-Time Tutor Malaysia, or if you have friends who are already in the industry don’t be afraid to reach out. The rates start at RM10 to RM150 per hour depending on qualifications and experience.

There is usually a high demand for language learning. While we are all asked to stay at home, online tutoring for language learning is becoming ever more popular. Being an online tutor allows you to make money from home easily. Put your bilingual or multilingual skills to use.

#3. Embrace Online Selling

With people more and more willing to shop online – there’s no reason you can’t make some healthy side money from selling items online too.

It also works great as a side business as you don’t need to physically be at a store and have better chances of engagement from consumers almost 24/7. You don’t even need to have a supply of brand new merchandised freshly manufactured, instead you can also go into selling used items. Chances are that there are always people interested to buy your preloved books or embroidery products.

With selling sites like Mudah.my, Lelong, Carousell, and Shopee – you don’t even need any website know-how to get started. Just upload a photo of your goods and handle customer queries on the go. Don’t forget to include your contact information to make it easier for your potential customers to reach you.

#4. Freelance Translator or Proofreader

We’re Malaysians, right? So, that means we’re either bilingual or multilingual. As the world continues to integrate, there will always be a demand for translators. 

Although there are many different automatic translation programs nowadays, there is still a market for translators. Many translating companies online are looking for freelancers to help with the translation tasks. If you are fluent in another language, you can make money from home by picking up these tasks.

Keep a lookout for work on Favser or Upwork. The hourly rate for translators starts around RM30 to RM40. 

#5. Freelance Writing

If you like writing, you may consider making some extra money from home by creating online content. Content writing especially makes up about 40% of marketing, so this line of work is high in demand and we don’t see it decreasing anytime soon.

Find opportunities at Content Writer or Favser. The market price at the moment for writers is RM0.60 to RM0.70 per word or RM150 to RM400 or more depending on the content that you’ll have to write.

The writing tasks can be for websites, blogs, magazines, etc. And you can be writing product descriptions, press releases, blog posts, and more. It is a good way to make some money while practicing your writing skills. You may even start a freelance writing career in the future with the help of these writing experiences.

Conclusion

Earning extra income can be a good way for you to increase your cash flow and allowed you to save more. It might not be easy to prevail especially when you are forced to take unpaid leave or being sacked from the previous job, but when there is a will, there is a way. You can come out of this stronger and earn new experiences along the way.

What other ways do you think will be good to earn extra income? Share with us in the comments section below.

Announcement by Bank Negara Malaysia on Hire Purchase/Fixed Rate Islamic Financing - A Quick Summary

Bank Negara Malaysia (BNM) announced that hire purchase loans and fixed rate Islamic financing deferments to be either paid back after deferment ends or will be subject to interest/profit rate on deferred instalments.

BNM announced that banking institutions are formalising agreements which reflect the revised payment terms with borrowers/customers with hire purchase loans and fixed rate Islamic financing to give effect to the 6-month moratorium on loan/financing payments to comply with the procedural requirements under Hire-Purchase Act 1967 and Shariah requirements including changes to the payment schedules and/or amounts as a result of the moratorium.

Quick Summary Related to BNM Announcement

1. This affects only Hire Purchase / Fixed Rate Islamic Financing products such as Personal Financing-i. There are no new changes announced to housing loans as they still refer to the previous announcement made on 25 March 2020.

2. Moratorium now is on an opt-in basis meaning you would have to apply. Banks will contact you with the details, and banks are supposed to inform you how your loans / financing would be affected if you choose to defer you monthly repayments.

3. If you opt not to defer, please continue paying your monthly repayments as usual.

4. Deferment period is still 6 months from 1st April - 30 Sept 2020.

5. Repayment of deferment amount (for those choosing to defer the monthly repayments for the deferment period) are as follows:

• If you pay the accumulated 6 months’ deferred instalments together with your October 2020 instalment, you will not be charged any additional interest/profit (i.e. term charges) on your deferred instalments.

• Alternatively, you have the option to extend your loan tenure by 6 months. In this case, interest/profit will be charged on the amount of your deferred instalments based on the contracted rate in your hire purchase agreement. No additional charges or legal fees are allowed to be charged to borrowers/customers.

6. Different banks might have different terms and conditions. Please refer to your respective banks for further details. Some banks might require you to go to their branches while others have an online or SMS-based process. BNM has reiterated that the deferment is still automatic with no changes to the eligibility criteria.

Take Control of Your Financial Situation

Our advice to clients for the moratorium will not be impacted by the announcement made above. Do take control of your financial situation and adapt to the new normal.

If you’re unsure of what actions needs to be taken or for additional clarification once you receive the notification from your respective banks, please get in touch with an expert to help you advice on actions you would need to take moving forward.

Additional reference: Soalan Lazim Mengenai Pengendalian Moratorium bagi Pinjaman Sewa Beli dan Pembiayaan Islam Berkadar Tetap (bnm.gov.my)

Contact us today to talk to a professional licensed financial planner.

5 Steps Taken to Avoid Making Financial Mistakes During Crisis

By Kian Ming Ng

Financial mistake seems inevitable during these times of crisis. But, what we can do to avoid making these mistakes?

Making smart choices with your money can be challenging. Only a few of us have any formal education in finance or accounting and even those who did take a basic personal finance course in school or university can probably count on one hand how much they remember or retained after all these years.

With the Movement Control Order ( MCO ) imposed by government due to worsening of Covid-19 situation, the sudden and drastic changes to our daily routines can put some of us at a stressful point, with frustration or desperation pushing us to make financial mistakes at this point in time.

What is a financial mistake?

Financial mistakes can be defined as financial losses due to decisions made on purchases of goods and services. Broadly speaking, it could be any of the following situations:

• Loss of money

• Weaker performance or poor utilization of that money

• Incorrect strategic decisions for money management

• Worse standard of living or financial flexibility

What is defined as a crisis?

A crisis can be defined as a time of intense difficulty and danger. It also means a time when difficult or important decisions must be made. The last financial situation in 2008-2009 is frequently referenced as a financial crisis or recession. With the World Health Organization (WHO) announcing that Covid-19 outbreak as a pandemic on 12 March 2020, this event is also considered a crisis, although one attributed more to disease.

The good news is that all of us can learn from the past and take steps toward financial security that will soften the blow. Very few lucky people made it out of crisis unscathed.

Knowing what financial mistakes exist in order to avoid them is a first step. Here are some examples of the financial mistakes people may make during a time of crisis:

Mistake #1. Excessive spending or spend before save.

Most people work extremely hard to earn their money and generate an income to provide for themselves and their families with a good life. Yet when it comes to managing that money and putting it to good use, many of us are fumbling around in the dark without a flashlight.

Most people still spend during a crisis as they would on other normal days. This was particularly evident during Movement Control Order (MCO) period, where although movement was limited, online shopping surged. Plenty of unnecessary spending on non-essentials was made especially with credit cards and e-wallet transactions.

The idea of “spend before save” has been the norm for majority of people from the moment they receive their income, instead of putting aside savings first before spending with the balance. Unfortunately, the spend-before-save behavior can lead to having nothing left for savings after all the spending is done.

Many people are spending more than they earn. They often fail to look at how to spend, what to spend on, and when to spend during times of crisis. In the end, their credit card bills surge and they eventually fail to clear the outstanding amount.

Some even defer or only make minimum payment to their credit card. Thus, more compounding interest on the late payment charges and outstanding amount.

Mistake #2. No cash reserves for rainy days

Not having savings is one of the key financial mistakes in why people take on so much debt and cannot get out of debt.  According to Bank Negara Malaysia, most people cannot even come out with RM1000 immediately from their own pocket during an emergency. This shows how serious and unprepared we are for rainy day needs.

The consequences and mitigation to overcome Covid-19 is not limited to short term and this would likely make many people start to tapping into their cash reserve funds, if they have any.

Many entrepreneurs may have suffered revenue loss due to the MCO as they cannot carry on with normal business activities. Hence, we should prepare for another wave of retrenchment of workforce in the next 3 to 6 months. Do you have enough savings to face this situation if it happens to you?

Mistake #3. Not having enough insurance coverage

If you were to ask the question on life expectancy to anyone that you meet, most people would assume they will live long and healthy. They do not think they will likely suffer any of the critical illnesses or be hospitalized due to accidents. That is why Malaysian insurance and takaful penetration rates are still relatively low as compared to many countries in the same region such as Singapore.

Once again, many are aware as to the importance of insurance, yet repeatedly consumers failed to comply with due to tight cash flow scenarios. Failing to cover ourselves sufficiently with suitable and affordable insurance or takaful coverage would probably make financial tension gets worse especially when we face medical emergencies or are laid off during times of crisis.

Mistake #4. Not Shopping for A Lower Interest Rate

Speaking of interest rates, another common mistake is not shopping around for lower rates, or re-evaluating your existing loans, credit card, mortgage, and other rates periodically. Many of these rates that are charged on credit and loan products vary with changes in the overall market and economy.

What is the impact on all of us as consumers since Bank Negara Malaysia ( BNM ) cut the OPR rates twice since the starts of 2020? We would probably still pay higher interest rate which that is why our expenses are not able to be reduced, or savings are not able to be done as most people would think that rate cut has nothing to do with them.

Mistake #5. Holding too much fixed assets and less liquid cash

Some people may plan to retire by investing in properties while hoping for rental yield as retirement funding. Thus, they started to accumulate number of properties in hand as good offers are available in market. This is a good idea to generate retirement funding. However, holding too little liquid cash would mean relying heavily on fixed assets which may not do good for some of the property investors during a crisis.

Investor often have the optimistic approach by investing in property and they believe they can get good yield from there. However, there will be times certain properties are vacant, in bad condition which need repair work to be done before it can be rented out again. What can owners do during a crisis when the whole market was having more supplies than demands? Do they have the holding power to maintain such number of properties?

Being aware of possible financial mistakes means we can prepare for them. Therefore, here are some mitigation plans to reduce the financial impact of unwise financial decision-making during a crisis:

Mitigation #1. Make detailed budgeting

As most of us are working to generate income for ourselves or our families, hence making an effort to do a detailed budgeting on how much is our personal expenses, family expenses, loan commitment, personal savings as well as family savings become relatively important especially during a crisis.

A detailed budgeting will allow us to go through cut unnecessary expenses, which will focus on the essential items such as necessity only. It will also allow us to look at how all-important element such as saving can be still maintained.

Simple income and expenses worksheet are available online, which can be downloaded based on personal needs.

Mitigation #2.Put aside cash for emergencies

As one receives their income, it is advisable to put aside 20% of their take home pay as savings for rainy days (i.e. emergencies) and other planning such as retirement and education planning. This would require self-discipline, regular habits, and high awareness the objective of this pool of funds.

Knowing the available funds in hands which are liquid will be important to ensure emergency funds are always available when needed. Placing the fund into fixed deposit, money market funds, and savings account which are not easily accessed can be an option to where emergency funds should be placed. It is recommended one should have at least 6 months of emergency funding at any time.

Hence it is important to have sufficiently at least 3 to 6 months or emergency funding for rainy days.

Mitigation #3. Have sufficient insurance coverage

It is not easy for any layman to understand and know how much each should be covered to be deemed as enough. Some suggested to use current income multiply by number of productive years to get the total sum assured needed in the event of death. However, this method may only solve the insurance needs at a time or sometime the outcomes of the calculation will put off the idea to get insured as most people still think insurance is expensive.

We need to take into consideration of how much we are currently covered before making the decision to increase our coverage for death, disability, personal accident, or medical. Schedule a yearly exercise to review our insurance coverage with a trusted and knowledgeable person, preferably your certified financial advisor.

Mitigation #4. Be aware of interest rates

Periodically, check with your banks as well online resources, in order to determine the current average interest rates for all your loans. If your rates are much higher, negotiate for a lower rate with the bankers.

Transfer the outstanding balance amount to another credit card with lower rates with balance transfer can reduce the interest paid. You may also get a debt consolidation loan. You may have to pay a small amount for the service, including some fees, but that is almost always far below what you will save.

Know your rates, market rates, and your options — even if you choose not to take advantage of them at the present time, it might make financial sense to do so in the future.

By knowing your rates, and periodically checking what is available, you can often negotiate lower rates, refinance loans, and save money.

People often avoid this because it is easier not to change things, and personal finances can be a bit intimidating. But you can save hundreds or thousands a year — that is worth some discomfort, research, and effort!

Mitigation #5. Achieve balance on fixed assets and liquid cash

It is important to review liquidity position to ensure we are not too heavy leaning towards fixed assets or liquid assets. It is recommended to remain modest on these two elements to achieve balanced holding.

Internal rate of returns (IRR) should be conducted every 1 or 2 years to ensure it is still worth keeping for investment. There is possibility where IRR of the property has gone lower due to certain reasons such as more supply and lesser demand due to the projects and etc.

Conclusion

The bottom line of all the above financial mistakes are fundamentally subject to individual and family needs. It must take into consideration of all other life goals to be achieved with the resources available in hands.

Hence, those who are not able to be disciplined to get personal finances done properly, should seek advice from Licensed Financial Planner as most people may not have the time and capability to do it on their own. Working with a licensed person will give you an overview on how to plan your finances ahead.

What other tips do you think will be good to avoid making financial mistakes? Do share with us in the comments section below