Dividend Magic

Saving and Investing towards Financial Independence in Malaysia

Financial Independence

The Employees’ Provident Fund – EPF in Malaysia

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Filed Under: Dividends, FI/RE, Financial Independence, Investment, Other Investments 12

The Employees Provident Fund (EPF) or also known as Kumpulan Wang Simpanan Pekerja (KWSP) is one of the most important retirement savings schemes in Malaysia. Whether you’re a salaried employee or self-employed, understanding how the EPF works can help you maximize your savings for a secure financial future and help with your retirement. This article covers everything you need to know about the EPF, including its benefits, contribution rates, withdrawal options, and strategies to grow your retirement fund.

What is EPF / KWSP?

The Employees Provident Fund (EPF) or also known as Kumpulan Wang Simpanan Pekerja (KWSP) is a mandatory savings scheme established by the Malaysian government since 1951 to help private-sector employees and non-pensionable public-sector workers save for retirement. It is managed by the Employees Provident Fund Board and ensures that Malaysians have sufficient savings to support themselves after retirement.

EPF Dividend Rates and Historical Returns

2024 – 6.30%
REJOICE!

EPF KWSP Malaysia Historical Dividends Full Dividend Magic

One of the key advantages of the EPF is its annual dividend payout, which has historically ranged between 5% to 7%. The fund invests in various asset classes, including equities, bonds, and real estate, to generate stable returns for members. EPF dividends are compounded annually, making it a powerful tool for long-term wealth accumulation.

The 6.30% declared for 2024 is one of the highest in history. Anything above 6% is really good for Malaysians. Rejoice!

EPF / KWSP Contribution Rates

Both employees and employers contribute to the EPF based on a percentage of the employee’s monthly salary:

  • Employees contribute 9% of their monthly salary.
  • Employers contribute 12% for salaries RM5,000 and below and 11% for salaries above RM5,000.

EPF Account Structure

EPF KWSP Malaysia Account 1 2 and 3 Akaun Persaraan Akaun Sejahtera Akaun Fleksibel How many %

The EPF divides contributions into three accounts:

  1. Retirement Account (Akaun Persaraan) 75%
    Originally Account 1, Akaun Persaraan aims to accumulate and increase the members’ saving level for the long term to achieve a comfortable life after retirement. Savings in Akaun Persaraan cannot be withdrawn before 55 years old.

    However, eligible members can invest a portion of their Akaun Persaraan savings in investments managed by the approved Fund Management Institutions (FMIs), subject to the terms and conditions. This is not recommended by Dividend Magic, keep your EPF money in EPF, no unit trusts please.
  2. Wellbeing Account (Akaun Sejahtera) 15%
    Originally Account 2, Akaun Sejahtera aims to meet the pre-retirement life cycle needs for the medium term. Savings in Akaun Sejahtera can be withdrawn for pre-retirement purposes (subject to EPF terms and conditions) such as:
    • Housing
    • Education
    • Health
    • Insurance/Takaful protection
    • Hajj
    • Age 50 Years Old
  3. Flexible Account (Akaun Flexible) 10%
    The aptly named Akaun Flexible is designed to meet members’ short-term financial needs. Savings in Akaun Fleksibel can be withdrawn by members any time, subject to terms and conditions. However, members are encouraged to withdraw only for emergency purposes and immediate needs only.

EPF Withdrawals

Age-Based Withdrawals

  • Age 50 Withdrawal – Members can withdraw from Account 2 as a partial retirement fund.
  • Age 55 Withdrawal – Members can withdraw the full amount in both Account 1 and Account 2.
  • Age 60 Withdrawal – For members who continue contributing after 55, they can withdraw their accumulated savings at 60.

Other Withdrawal Options

  • Full withdrawal for permanent disability
  • Full withdrawal for leaving Malaysia permanently
  • Nomination benefits – To ensure savings go to the rightful beneficiary in case of death
  • For the Flexible Account (Account 3) – You can withdraw from Akaun Fleksibel any time through the KWSP i-Akaun app. Once processed, the funds will be disbursed directly into your bank account. It’s important to note that there is a minimum withdrawal amount of RM50.

EPF Withdrawal – More than RM1 million savings

EPF KWSP more than RM1 million withdrawal

This here is the best form of withdrawal. If you happen to be a high income earner or you have voluntarily contributed extra amounts every year, you’ll find yourself with more than RM1 million in EPF savings. This is when you get the flexibility to withdraw any savings in excess of RM1 million.

An important note – you have to withdraw a minimum of RM50,000 at any one time.

Strategies to Maximize Your EPF Savings

  1. Voluntary Contributions – You can contribute beyond the mandatory rate to boost your retirement fund.
  2. i-Invest – Invest a portion of your EPF savings in approved unit trusts to potentially earn higher returns.
  3. Delay Withdrawals – Keeping your funds in the EPF beyond 55 years old allows your savings to continue compounding.
  4. Diversify with Private Retirement Schemes (PRS) – Supplement your EPF with PRS to enhance your retirement income.

EPF Voluntary Contribution – RM100K a year

You can choose to increase your EPF savings voluntarily on top of your existing mandatory monthly deductions, with as little as RM10, up to a maximum of RM100,000 per year. 

By starting your savings journey as early as possible, you can take advantage of the power of compounding, giving your savings more time to grow. So, that’s why you should start saving now to ensure comfort and financial stability during retirement.

More info on Voluntary Contribution to your EPF here.

EPF i-Saraan – Self contribution and RM500 per year

EPF KWSP Malaysia i-saraan self contribution RM500 and RM5000

Self-employed individuals can also voluntarily contribute to the EPF under the i-Saraan scheme, which allows them to enjoy government incentives while saving for retirement. More on EPF’s i-Saraan scheme here.

Please do self-contribute here and earn that RM500 per year if eligible for i-saraan. Do take note that there is a lifetime incentive limit of RM5,000.

Who is eligible to apply for EPF’s self contribution scheme – i-Saraan?

  • Malaysian
  • EPF Member
  • Self-employed individuals (not an employee)
  • Below 60 years of age.

KWSP i-Sayang – Contribute To Your Wife’s Retirement Savings​

i-Sayang is an initiative introduced by the government that allows the husband (contributor) to transfer the 2% employee share contribution received from the employer to the wife’s (recipient) EPF account.

EPF KWSP i-Sayang - Contribute To Your Wife's Retirement Savings​ i-Suri

Features of EPF’s i-Sayang

  • Transfer of 2% employee share contribution received from the employer to the wife’s EPF account.​
  • The application is made voluntarily by the husband, and the transfer occurs automatically each month when an employer contribution is credited to the husband’s EPF account.​
  • The transfer of this contribution cannot be cancelled unless the wife divorces or dies.​
  • More information here.

We’re all familiar with EPF as our retirement fund. But what does EPF actually invest in?

dividend magic - retirement
‘How late do you expect to be working?’

Main Assets of EPF

As of 2018, equities made up about 41% of EPF’s total assets.

A further 50% is invested in fixed income instruments.

Let’s have a look at some of EPF’s largest equity holdings.

It’s a good idea to have EPF’s investments as a reference, apart from my Freedom Fund of course. ; )

What I Do With My EPF

I personally am leaving my EPF untouched till I reach 55. And then I’ll withdraw a monthly amount to keep me alive, slowly drawing down on the capital. And if I do happen to have extra funds, I will be self contributing to EPF, up to RM100K a year.

Your EPF is essentially forcing you to save a portion of your income every month. And it helps you reinvest those 6% and above dividends every single year.

Even though I’ve mentioned there being no wrong answers to the poll above, I do believe Option 2 and 3 – where you’re essentially drawing down on your funds from your EPF savings is the least financially sound decision.

I see no reason for one to forego that 6% return in lieu of mutual funds or property. If you’ve got to take money from your retirement savings to purchase something, you definitely can’t afford it. In my opinion, of course.

Has anyone done this long term and made good money from Options 2 and 3?

End.

The EPF is a crucial pillar of retirement planning for Malaysians. Understanding its features, making informed contributions, and leveraging available investment options can help you build a robust financial future. Whether you’re just starting your career or nearing retirement, proactive planning with the EPF can ensure you enjoy financial security in your golden years.

You may have heard from uncles and aunties telling you to withdraw as much as you can during times of uncertainty. Mutual fund agents may have enticed you to believe their RM100 million funds are superior to our national fund – worth over RM800 fucking billion dollars.

Property agents may have hinted that your purchase of that 3BR apartment is a better decision than leaving your money in the hands of a professional investing team.

I think all are a load of hokum and I’ll stick with EPF for the foreseeable future.

I think you should too. 
And this is a plea to all Malaysians, don’t squander away your retirement savings.

TL;DR – Withdrawal from EPF? Bad idea.

Funding Societies – Risks, Defaults and Diversification

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Filed Under: Portfolio - Freedom Fund, Financial Independence, Investment, Other Investments 8

Funding Societies Malaysia

This will be an update to my earlier post on Funding Societies, Malaysia’s (largest?) P2P platform.

As I have posted and shown earlier, my investments in Funding Societies has netted me an annualised return of 13.12%. As of today, it has increased slightly to 13.15%.

The referral bonus from you guys does not affect that 13.15% return. 

To put the returns into perspective, my IRR and average return for the Freedom Fund is at the 12% mark for the past few years.

 

Calculating Simple and Effective Interest Rate

Funding Societies Effective Interest Rate
Simple vs Effective Interest Rate

 

From the example, interest returns of RM10,000 for an RM100,000 investment opportunity (effective investment exposure of RM55,000) gives you an effective return as high as 18% (RM10,000 / RM55000).

The monthly repayments help reduce your risk exposure every month while increasing your investment returns. Best of all, if you choose to reinvest the monthly repayments you receive, you’ll compound and achieve even higher returns.

The folks at Funding Societies have a handy explanation for simple vs effective interest rates. The effective interest rate comes in handy when you want to compare your investments vs other choices in the market.

Default and Diversification

Most of you are worried about the risk involved when lending your hard-earned money to businesses you know almost nothing about. And you should be.

However, you’d be happy to know that the regional default rate as of November 2018 is at 1.02%.  Regional meaning Malaysia, Indonesia and Singapore.

Even more good news, the default rate in Malaysia is 3 out of 300 loans. That is 1.0%. With that kind of risk and return rates, I hope you’ll be able to make a more informed decision.

I do expect the default rate to increase in the near future as more businesses seek funding through the P2P network. As for me personally, I’ve yet to have a loan default in my portfolio.

Defaults are normal in the P2P lending industry so the key to success for us as investors is to DIVERSIFY.  The loans from Funding Societies give your returns anywhere from 10% to 16%.

I personally use the Auto Investment Bot provided by Funding Societies Malaysia.

I set my parameters as follows:

  • RM300;
  • A minimum investment period of 1 month;
  • A maximum investment period of 24 months;
  • At least 12% simple interest rate; and
  • At most 18% simple interest rate.

Signing Up – RM50 BONUS

Signing up to be invest is a breeze. Just head over to Funding Societies, and all you need is your IC / passport number, an email, and your mobile number.

Additionally, you’ll receive a bonus RM50 when you sign up with my code j1mwa37p

The terms? You’ll just have to invest a collective amount of RM1,000.

End.

I’ve been using Funding Societies for close to a year now and that 13.15% return is real. If you’re able to stomach that minuscule default rate they have right now, I think this would make a good investment alternative.

Again, thank you, everyone, for using my code upon registration.

I’ve gotten messages of concern from many of you advising against posting my referral bonus. But my aim is to always be as transparent as I can. I’m not recommending P2P for the referral fees.

Review of 2018

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Filed Under: Dividends, Financial Independence, Investment, Portfolio - Freedom Fund 2

Goals

2018 – Goals Dicapai

“Moving forward, maintaining that 4.5% yield will be the goal.”  – myself

In 2017’s ending post, I set myself the goal of maintaining my 4.5% yield.

I’ve managed that and then some. 4.92% to be precise.

Total dividends went from RM16K in 2017 to RM18K in 2018. A 13.62% increase.

2019 Goals – Financial Independence

  • Dividend yield > 5%
  • Total dividends > RM20,000 p.a.

I’ll be looking to break the 5% mark in 2019 with more savvy purchases. Got my cash in hand to start buying soon with the current downturn in the market.

As part of my push towards F.I. (“Financial Independence“), I’ll be aiming to have my dividends reach RM20,000 in 2019.

My FI goal is to have RM36,000 in passive income per annum. I’m halfway there in 2018 with RM18,000 in dividends.

I can’t wait for my dividends to snowball in the next few years and achieve FI by the age of 35. That’s when it’ll get interesting as I will have extra income to delve into riskier investments ie. startups.

Investment in the KLSE

2018 has been a wild ride for stock investors. The last few months, especially.

In fact, due to the recent slump in the market, my portfolio is in the red for 2018.  To the sum of about RM20,000.

I’m of course talking about capital losses. ie. unrealized losses. 

This would be a good time to remind everyone of the significance of long-term investing and holding power.

When you invest, make sure you have the ability to hold a stock for at least 10 years. Even better, have cash on hand to take advantage of the drop in prices during recessions.

Always stay invested.

My Portfolio

Freedom Fund – RM443,435.79
IRR – 8.60%
Dividends – RM18,072.25
Dividend Yield – 4.92%

If you haven’t already, I’d like to invite you to have a look at the Freedom Fund. Take notice of the increase in yields over the years.

Overall, the Freedom  Fund is still making money, to the tune of 8.60% per year. This includes both capital gains as well as dividends.

8.60% still isn’t good enough. My main focus right now is to catch up and reach the 10% mark.

Dividend Magic – the site

Dividend Magic started out as a place of accountability for me personally. To keep me and my investing honest and truthful.

To have a public space on the interwebs to show Malaysians that investing isn’t difficult. To demonstrate that if you’re disciplined in your investing, you’ll have a steady source of passive income that will see you through the rest of your life.

I’m happy to have built a nice community here where everyone is able to chat and discuss in a non-toxic environment. Grateful to have met many awesome people in 2018 and looking forward to 2019.

FOLLOW

If you haven’t already, follow me on Facebook and Instagram to keep up with everything else about me. You’ll see a different side of Dividend Magic on those platforms.

https://youtu.be/tA_zVU5GbCQ

End.

Dividend Magic - We can do it!
Rosie the Riveter

As we head into 2019, I hope most of you who’re reading have started investing. Be it in stocks or other assets.

Post your portfolio value, dividends and dividend yield here and I’ll hold you accountable. We will revisit it again together at the end of 2019 and see how everyone is doing.

I’ll keep it simple and title all year-end posts – A Review of 201… 

Thank you for reading as always. To 2019!

BigPay Review – AirAsia’s e-wallet

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Filed Under: Financial Independence, Free Stuff, Other, Travel, food and the finer things in life 8

AirAsia Tony Fernandes

Tony Fernandes was quoted, saying ‘One day, Big Pay will be worth more than AirAsia‘.

I am excited about BigPay and I’m writing this post just as I received my card. Today.

 

Why BigPay?

BigPay

AirAsia BIG Points

Big Pay is by AirAsia, Malaysia’s favourite airline. You and I both know you’ll probably be on an AirAsia flight this year.

You’ll be receiving exclusive AirAsia benefits when you use your BigPay card with AirAsia such as:

1. RM0.00 payment processing fees

2. Discounts on pre-booked check-in luggage and in-flight meals

3. Exclusive early access to AirAsia sales

4. 1 BIG point when you top up RM50 and 1 BIG point for every RM20 spent on BigPay

In my opinion, the RM0 payment processing fee is reason enough to get BigPay.

 

The End of Long Queues for Foreign Currencies

For the serious travellers and not-so-serious ones out there, BigPay is god-sent. Why? Exchange rates.

BigPay touts itself as giving the ‘best’ rates out there, but to be frank, I’d call it competitive.

Queue at Mid Valley Foreign Exchange House
The queue at Mid Valley

Forget the long queues at your favourite foreign exchange outlets. Using BigPay, you’ll receive really competitive rates with no extra fees!

The rates Big Pay uses can be found at Mastercard’s website.

 

Convenience

All it takes is for you to top up your BigPay online, in Malaysia.

Travel abroad to your destination of choice, insert your card into any ATM in that country and voila – Watch the ATM spit out your cirsp foreign currency.

Withdrawals done in Malaysia will be subjected to a fee of RM6 per transaction & overseas withdrawals will be charged at RM10 per transaction.

Besides that, BigPay also allows you to send/receive money to and from friends. Instantly. No fees!

 

Analytics

BigPay also breaks down your expenditure on the app itself. Nifty for people wanting to keep track of their spending.

How to Sign Up for your BigPay Card

Detailed below is how to sign up for your BigPay Card.

Before we continue, remember this referral code: SPUXOYWAI5

You get a free RM10 (as do I) from signing up with the above code.

 

1. How do I get the BigPay app?

You can download BigPay for free directly from the App Store or Google Play Store to get started.

2. How do I sign up for BigPay?

All it takes are 3 easy steps to sign up for BigPay:

i. Fill in your basic personal details

ii. Verify your identity with your IC/passport and a selfie

iii. Add RM20 into your account

3. How much does it cost to sign up for BigPay?

Signing up and getting your card is completely free! You will need to add a minimum of RM20 that will be stored on your card for your usage. We don’t charge any inactivity fee either, so signing up & keeping your BigPay account does not cost you anything.

Using this referral code: SPUXOYWAI5

You get a free RM10 (as do I) from signing up with the above code.

End.

I foresee myself using BigPay long into the future.

Especially every time I travel.

So. Sign up. Get the free RM10 and whip that card/app out whenever you go abroad.

Also, the card is a beaut.

bigpay-airasia

Unit Trusts & Mutual Funds vs DIY Investing

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Filed Under: Dividends, FI/RE, Financial Independence, Investment 13

F*ck the Funds, F*ck the Fees.

I’ve seen too many people investing in unit trusts, mutual funds, saving plans – whatever these fee-charging schemes call themselves. Some argue that a fund manager will earn better returns for you. Look at their overall performance. Ask the right questions, and the answers rarely justify the high fees.

Ask them some questions and it’ll all start to fall apart.
If you’re still not convinced, take a look at Warren Buffett’s 2023 bet against managed funds here.

When someone charges you a fee to manage your money, know that even a 1% fee can cost you dearly. Fees reduce the growth potential of your investments, and the effect of compounding can work against you. Fees ultimately impact your investment’s growth potential. In a huge, huge way. How huge? The following simple example will illustrate.

The Impact of Fees – The Magic of Compounding Working Against You

We have here, 3 female investors.

Consider three investors, each earning a 10% return per year on an initial RM100,000 investment in 2018. The only difference between them is the fee they pay:

  • Girl A: DIY invests on her own, with total fees of about 0.33%.
  • Girl B: Pays a 1% fee – a conservative figure for a fund.
  • Girl C: Uses a unit trust or hedge fund, paying an estimated 3% annual fee.

Now, long-term investing. Let’s have all 3 investors invest for 30 years.

Unit Trusts & Mutual Funds vs DIY Investing Dividend Magic Fees Impact 30 year

30 Years Down the Road

  • Girl A (0.33% fees): Portfolio grows to approximately RM1.6 million.
  • Girl B (1% fees): Portfolio grows to around RM1.32 million, a loss of about RM250K compared to Girl A.
  • Girl C (3% fees): Portfolio grows to roughly RM760K—a loss of about RM900K compared to Girl A.

30 years down the road, Girl A’s investment is going to be worth 2x more than her counterpart that invests at 3% fees.

Now let me show u the difference in value in 50 years. Still a reasonable time frame in my opinion.

Unit Trusts & Mutual Funds vs DIY Investing Dividend Magic Fees Impact 50 year

50 Years Down the Road

Over a 50-year period, the impact of fees becomes even more dramatic. Even a 1% fee can leave you with an investment value that is RM3 million less than if you had lower fees. For Girl C, the loss is even more staggering – she is at an RM7 million loss compared to Girl A. This example shows how fees can quickly erode your investment gains.

Girl C is probably going to be really happy if a unit trust agent tells her she will have RM3 million after 50 years IF her investments give her 10% annually. But, mention her girl friend A’s investment value of RM10 million? She’s bound to go ballistic.

How’s that for compounded interest? This time, compound interest is working AGAINST you.

Why Fees Matter

High fees act like a hidden tax on your wealth. They reduce the power of compounding, the key driver of long-term growth. Ask around—talk to your parents, uncles, or aunties about their unit trust investments. Many will tell you stories of returns that never met expectations. Now, imagine comparing that with an investment that grows free from high fees. The difference is striking.

A 1% fee could translate to a difference in the millions. Be aware of fees.

What Can You Do?

Invest on Your Own

Consider DIY Investing and managing your own investments in stocks and equities. This can save you from paying high management fees.

We’re fortunate to have local platforms like MooMoo that charge low fees and is regulated in Malaysia.
My review of MooMoo Malaysia can be found here.

Choose Low-Cost Funds

If you prefer professional management, look for funds with minimal fees. Go for international and US ETFs. You can start by taking a look at Vanguard’s VOO. Low fees and they mirror the whole S&P 500. VOO can be bought via MooMoo as well.

Ask Questions

Always inquire about fee structures and the impact on your long-term returns before you commit. As a general rule, forget all our local unit trusts and mutual funds. If you want to invest locally, DIY and invest in stocks. If you want exposure to international and US stocks, go for ETFs.

Conclusion – Say NO to Fees

Next time someone tells you that a 1% or 3% fee is acceptable, show them these figures. Or tell them about Dividend Magic. The cost of fees is not insignificant, and over decades, they can crush your returns.

Pardon my language, but I feel strongly about this. If you want to build wealth, start by keeping your fees low.
You can start by learning how to invest on your own stocks and equities hERE.

Dividend Income Update 2017

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Filed Under: Dividends, Financial Independence 7

A list of my past dividend income and updates can be found below:

December

The Freedom Fund has been updated as of 31 December 2017. The full list of dividend yields from my shareholdings can be viewed there.

The last month of 2017 gave me RM1,304.48 in dividends. Compared to December of 2016 – RM1,037.75. A 25.7% increase thanks to newcomers TENAGA and SCICOM.

Scicom (MSC) Berhad

This Month’s Dividends – RM168

Total 2017 Dividends – RM756

Dividend Yield – 4.33%

Nestle Malaysia Berhad

This Month’s Dividends – RM140

Total 2017 Dividends – RM540

Dividend Yield – 4.04%

AXIS REIT

This Month’s Dividends – RM556.48

Total 2017 Dividends – RM1,619.51

Dividend Yield – 4.72%

Tenaga Nasional Berhad (TNB)

This Month’s Dividends – RM440

Total 2017 Dividends – RM440

Dividend Yield – 3.12%

Purchases

I’ve added 2800 more shares of Scicom Berhad at RM1.73 each.

End.

The total sum of dividends received for 2017 was a grand RM15,905.71. Comparatively, I received RM11,429.55 for 2016.

A 39.2% increase in dividends.

My dividend yields have increased over the years as well – from 2.85% in 2015, 3.84% in 2016 and now, 4.69% in 2017. This is what dividend investing is all about.

I’m more than happy with a yield higher than that of our current FD rates. The goal will be to try and maintain this yield come 2018 and in the long term see it cross the 5% AND 6% mark.

I’ll have a Review of 2017 post up in the coming week(s).

As always, thank you for reading and have a great 2018!

November

For November, I received a total of RM1,438.87 in dividends.

Compared to November in 2016, that’s a 162.8% increase where I received RM547.48 in dividends.

The main contributor? Maybank and AEON Credit.

Malayan Banking Berhad

This Month’s Dividends – RM747.96

Total 2017 Dividends – RM1,761.72

Dividend Yield – 6.64% (that sweet yield)

Weight – 7.43% of the Freedom Fund

AEON Credit Service (M) Berhad

This Month’s Dividends – RM359.21

Total 2017 Dividends – RM359.21

Dividend Yield – 1.59% (Purchased in November)

Weight – 5.21% of the Freedom Fund

Sunway REIT

This Month’s Dividends – RM331.70

Total 2017 Dividends – RM1,204.55

Dividend Yield – 6.07%

Weight – 5.62% of the Freedom Fund

End.

Total dividends up to the month of November is RM14,601.23

The goal for 2017 is RM15,000 in dividends. It looks like we’ll barely make it this year! I’m expecting about RM500 in dividend income for December, a little lower than last year due to my disposal of major shares – BONIA and TAANN.

The dividend yield of my portfolio is currently at 4.39%.

To everyone that was asking for the November updates via PMs/comments, I’m really sorry as I’ve been busy as hell this month. Year-end updates coming soon!

As always, thank you for reading!

October

I apologize for the delayed post this time around. I realize I’m about 2 weeks late.

I received a total of RM1,454.52 in dividends for October.

That’s an 81.8% increase compared to the same month last year where I received RM800 in dividends. The difference? AirAsia!

Even with Maybank’s dividends coming in November this year instead of October, AirAsia more than made up for it with RM1,200 in dividends alone.

AirAsia Berhad

This Month’s Dividends – RM1,200

Total 2017 Dividends – RM1,980

Dividend Yield – 6.73% (look at that sweet yield)

Weight – 8.22% of the Freedom Fund

Sunway Berhad

This Month’s Dividends – RM254.52

Total 2017 Dividends – RM522.72

Dividend Yield – 4.59%

Weight – 3.69% of the Freedom Fund

End.

Total dividends up to the month of October is RM13,162.36.

Would I say we’re on track to reach 2017’s goal of RM15,000 in dividends? It’ll be close I think. But YES! Thanks to October’s outstanding performance.

The dividend yield of my portfolio is currently at 4.19%. Really glad to have surpassed that 4% yield mark, and we’re only in October.

Bask in the glory of that 4% yield!! This 4.19% is only the passive returns alone from my portfolio.

Since I’ve reduced my gross investment in the fund to only about RM25,000 this year, we should see significant growth in dividend yield moving forward.

As always, thank you for reading!

September

I received a total of RM1,136.30 in dividend income for the month of September.

That’s a 3.1% decrease compared to the same month last year where I received RM1,172.15 in dividends.

The decrease was mainly due to a few companies giving out their dividends earlier which I placed into the August group.

September 2017’s dividend income was made up of a total of 6 different companies – Sunway REIT, Nestle, Scicom, IGB Corp, Sunway Construction and Homeritz.

Sunway REIT

This Month’s Dividends – RM289

Total 2017 Dividends – RM872.85

Dividend Yield – 4.40%

Weight – 5.59% of the Freedom Fund

Nestle Berhad

This Month’s Dividends – RM140

Total 2017 Dividends – RM400

Dividend Yield – 2.99%

Weight – 3.94% of the Freedom Fund

Scicom Berhad

This Month’s Dividends – RM252

Total 2017 Dividends – RM588

Dividend Yield – 3.37%

Weight – 4.54% of the Freedom Fund

IGB Corp

This Month’s Dividends – RM200

Total 2017 Dividends – RM200

Dividend Yield – 1.74%

Weight – 2.65% of the Freedom Fund

Sunway Construction

This Month’s Dividends – RM10.80

Total 2017 Dividends – RM19.80

Dividend Yield – 3.37%

Weight – 0.17% of the Freedom Fund

Homeritz Corporation

This Month’s Dividends – RM244.50

Total 2017 Dividends – RM1,222.50

Dividend Yield – 8.65%

Weight – 5.42% of the Freedom Fund

End.

The Freedom Fund’s dividend income has a cumulative total of RM11,707.84 as of September 2017.

We’ve officially surpassed last year’s total dividends of  RM11,429.55. Based on historical dividend income, we should be getting at least another RM2.3K in dividends for the 4th Quarter of 2017.

The dividend yield of my portfolio is currently at 3.53%. The Freedom Fund will be updated in the coming weeks as Q3 has come to a close, so stay tuned!

Thanks for reading.

August

The 8th month of 2017 fetched me a total of RM1,880.64 in dividends. A pretty good month I’d say.

That’s a 23.8% increase compared to the same month last year, which gave me RM1,518.99.

The total is made up of the following:

CBIP

This Month’s Dividends – RM420

Total 2017 Dividends – RM840

Dividend Yield – 3.77%

Weight – 6.61% of the Freedom Fund

Public Bank Berhad

This Month’s Dividends – RM162

Total 2017 Dividends – RM354

Dividend Yield – 3.19%

Weight – 2.86% of the Freedom Fund

IGB REIT

This Month’s Dividends – RM900.60

Total 2017 Dividends – RM1,785.70

Dividend Yield – 5.96%

Weight – 9.37% of the Freedom Fund

Axis REIT

This Month’s Dividends – RM398.04

Total 2017 Dividends – RM1,063.03

Dividend Yield – 4.40%

Weight – 7.74% of the Freedom Fund

Recent Acquisitions

August has been a relatively uninteresting month for me without any buys / sells.

My recent acquisitions back in July are already looking strong though. TNB is already up by 3% for me.

Aeon Credit has rebounded to RM12.84 per share. Things are looking good.

The next buying opportunity should come election time.

Is everyone’s’ cash / warchest at the ready?

End.

Total dividends for the year stands at RM10,574.54. My Freedom Fund currently has a dividend yield of 3.19%.

It’s a tall order but I’ll hopefully see my portfolio pass the 4% dividend yield mark this year.

The Freedom Fund itself is doing great, it’ll be updated come the end of September (Q3).

As of right now, capital gain wise, I’m up almost 30% and the fund has for the first time passed the RM100K profit mark!

July

After the high of June’s dividends, RM552 in dividends for the month of July was lower in comparison. Same time last year, I received RM420 in dividends. A pretty decent 31.4% increase y-o-y.

Average Dividend Increase (so far) – 37%

I’ve started tracking my dividends received closely and, although I may be jumping the gun here (as it isn’t even December yet).. BUT, as of now, my monthly dividends have been increasing every month! With the exception of March because good old CBIP Berhad paid a special dividend last year.

On average, my dividends have increased 37% in 2017. Goodbye inflation, goodbye Fixed Deposits. This is why I invest in shares and companies. My returns increase with time, while ‘investments’ like FDs will stay at the 3-4% levels for years, even decades.

Full disclosure, I did add RM2,500 and RM15,000 to my investments as additional capital in December 2016 and June 2017 respectively but that hardly impacted the 37% increase in dividends.

Also, I’m not implying FDs are useless, they have their uses but are essentially useless as investment instruments.

Moving on.

Scientex Berhad

This Month’s Dividends – RM552

Total 2017 Dividends – RM1,312

Dividend Yield – 4.48%

Weight – 19.40% of the Freedom Fund

Recent Buys

Aeon Credit -1,000 units

Their dividends have been increasing every year for 5 years now. However, the price has dropped by 5% since my purchase.

Tenaga – 1,000 units

Good dividends, almost a monopoly on our country’s electricity. Moving into other countries.

Their close links to the Malaysian government are a double-edged sword.

IGB Corp – 4,000 units

Highly undervalued and overlooked because of the pending offer by Goldis Berhad.

Conclusion

Total dividends for the year stands at RM8,690.90. My Freedom Fund currently has a dividend yield of 2.69%.

Thank you for reading!

June

June is an important month for me, it marks the end of the first half of the year. It’s the time when I take a closer look at my finances and investments, to assess how my year has been so far and to plan for the 2nd half. Historically, June has also always been the most productive month for me every year in terms of dividends.  Barring any unforeseen special dividends, the 6th month of the year is set to retain that title this year. By a big margin.

I raked in RM3,750.74 in dividends for June from a total of eight different companies. Last month’s dividends totaled RM393.79, which as you can tell, is roughly only 10% of June’s dividends.

This is a huge milestone for me. For one, this is the first time my portfolio has crossed the RM3K per month threshold in dividends. Secondly, comparing to last year’s RM2,392.37 in dividends, that’s a 56.8% increase.

The figure for June 2016 was increased from RM1,852.37 (in the previous article) to RM2,392.37 here as I made a minor mistake in forgetting Tune Protect’s dividend of RM540 June last year.

Moving on, we’ll have a look at the companies that contributed to my RM3,750.74 in dividends. And then at my Freedom Fund’s performance.

Sunway REIT

This Month’s Dividends – RM296.48

Total 2017 Dividends – RM583.85

Dividend Yield – 2.94%

Weight – 6.25% of the Freedom Fund

Malayan Banking Berhad

This Month’s Dividends – RM1,013.76

Total 2017 Dividends – RM1,013.76

Dividend Yield – 3.82%

Weight – 7.83% of the Freedom Fund

Maybank’s DRP

A couple of weeks ago, I participated in Maybank’s Dividend Reinvestment Plan and opted to receive a portion of my dividends in shares instead of cash. This is the result of that. The total RM1,013.76 in dividends includes the share portion of my dividends.

Awesome Returns

Take a look at the dividend yield, that’s 3.82% yield for me – so far! This is only the first of two dividends to be paid out this year, the other being in October. I managed to purchase the bank’s shares when it was spiraling down back in 2016.

Nestle (M) Berhad

This Month’s Dividends – RM260

Total 2017 Dividends – RM260

Dividend Yield – 1.94%

Weight – 3.95% of the Freedom Fund

Tune Protect

This Month’s Dividends – RM561.60

Total 2017 Dividends – RM561.60

Dividend Yield – N/A (Sold)

Weight – N/A (Sold)

Homeritz Corporation Berhad

This Month’s Dividends – RM244.50

Total 2017 Dividends – RM978.00

Dividend Yield – 6.92%

Weight – 6.25% of the Freedom Fund

Scicom (MSC) Berhad

This Month’s Dividends – RM168

Total 2017 Dividends – RM336

Dividend Yield – 1.92%

Weight – 4.71% of the Freedom Fund

Cypark Resources Berhad

This Month’s Dividends – RM426.40

Total 2017 Dividends – RM426.40

Dividend Yield – 2.41%

Weight – 4.66% of the Freedom Fund

AirAsia Berhad

This Month’s Dividends – RM780

Total 2017 Dividends – RM780

Dividend Yield – 2.65%

Weight – 8.26% of the Freedom Fund

The Freedom Fund

The Freedom Fund‘s updated stats are as follows:

Gross Investment: RM295,114.52
Market Value: RM388,720.81
Dividends (2017): RM8,138.90
Cash Available: RM34,000
Capital Gain: 31.72%
IRR: 12.76%

I aim to have at least RM25,000 at all times at the ready to invest in the case of a market correction. Ideally, I’d like to have RM50,000 in in the saddle. Trying to keep myself disciplined and at the same time I’ve been keeping busy adding more stocks to my buy list.

End.

Concluding this post, total dividends for the year stands at RM8,138.90. The Freedom Fund’s dividend yield comes in at 2.76%.

Same time June last year, my total half-year dividends were only RM5,933.18. That’s a nice 37.18% increase in dividends for me y-o-y. Moving forward, I expect to break the RM10,000 in dividends mark in September.

My goal set earlier this year in my Review of 2016 was RM15,000 in dividends for 2017. It’ll be tight and achieving that goal would ultimately depend on increases in dividends from my holdings.

I’ve seen an increase in readers having started investing this year! Please do write in and let me know how you’re doing. Even if you’ve started small, don’t forget to keep track of your investments. Thank you for reading!

May

April’s dividends were only RM277.20. Low but there was an increase so no complaints there. In May last month, my dividend income totaled RM393.79. All of which were from Axis REIT.

Compared to May last year, I had nothing in dividend income. Axis’ dividends actually came in on 31 May and I decided to capture the figures in May hereafter.

Axis REIT

Last year, Axis REIT gave me a first interim dividend income of RM263.37. Last month, I received RM393.79. That’s a 49.5% increase in dividend income for me. Please note that I increased my holdings to 20,236 units earlier in February.

Axis’ dividend per unit (DPU) increased from 2.00 to 2.04 sen. They’ve been on a buying spree which is expected to end sometime this year. They’ve recently proposed a private placement at an issue price of RM1.58 to pare down their borrowings. This should see them being able to make further acquisitions should the opportunity arise.

Not too thrilled about the RM1.58 issue price but that’s the nature of private placements here.

Conclusion

Total dividends for the year stands at RM8,138.90. My Freedom Fund has a dividend yield of 2.52%.

I’m finally on Instagram! Follow me hERE or look for me on Instagram @dividendmagic

I’ll be away for the week on holiday. Will be updating on my Facebook as well as Instagram! See you guys there. 

April

Well lads, if you’ve been with me this time around last year, you’d know that April is usually a slow month for me. Dividends last month totaled RM277.20, compared to last year’s RM230.40. Don’t let the small amount fool you, that’s a 20.3% increase in dividends y-o-y. So far, we’ve been seeing big increases (more than 20%) in dividends every month except for March. A very positive and promising sign.

The RM277.20 last month was split between Sunway Berhad (RM268.20) and Sunway Construction Group (RM9.00).

Sunway Berhad

Sunway did something different this time around. They distributed a part of April’s dividends as cold hard cash. The remainder was distributed in the form of shares – 1 share for every 100 shares owned to be precise.

This is a new experience for me and a good one. Let me give a brief explanation why. Education time!

The dividends I received in the form of shares are called treasury shares, which are shares held by Sunway. Companies often repurchase their own shares via the market if they deem the share prices to be undervalued. Share buybacks are really good for shareholders like you and me because essentially, it increases our ownership in the company.

Acquisitions and Disposals

On 14 April, I made a decision to part with all 33,700 units of my BONIA shares. Including dividends received as well as fees, I made a loss of RM3,811.67 (-14.12%). Painful but it had to be done. BONIA had been hit by GST but looking at other retailers, it doesn’t look like the company has a good handle on the problem. I’ll, of course, be keeping an eye on them should their earnings show signs of improvement.

With BONIA disposed of,  I had about RM22,000 in reserves. Scientex took a tumble recently due to a private placement (priced at RM7.80 if my memory serves). At the time of the placement, Scientex’s shares were at an all-time high of more than RM9 per share. It has since dropped to around RM8.20 – RM8.30 today. I snapped up 1,600 shares at RM8.26 on 2 May 2017. My latest valuation of the company – even after stripping the company, it is still worth RM220 million easily.

Conclusion

Summing it all up – I brought home a total of RM277.20 in dividends (both in the form of shares and cash). Dividend yield for my Freedom Fund increased to 1.23% from 1.19% a month ago.

I should be attending AirAsia’s AGM later this month on the 25th. If any of you are going, drop me a message or comment, maybe we can carpool! Come back in a few days for my article on Nestle’s doorgift. Hint: It was a disaster.

March

The end of March also marks the conclusion of the first quarter for 2017. I’ve updated the Freedom Fund accordingly. My portfolio grew from RM345,955.92 back in December 2016 to RM381,021.54. That’s a gain of RM35,065.62 or 10.14% for me. However, do note that gross investment also grew from RM297,777.83 to RM312,929.52.

I did not inject any extra capital into the fund, the additional investments came from cash reserves. I do feel the need to apologize if my figures and tables are all over the place, I’m learning as I go and always finding better ways to record. Please bear with me. I’d also greatly appreciate any advice or help or criticism with my records, so please feel free.

Acquisitions and Disposals

Earlier in February, I added 6,000 units of Axis REIT shares priced at RM1.67 each, increasing the total quantity to 20,236 shares. I disposed off Eco World shares on 22 February 2017, netting a 9.22% (RM1,194.54) net gain.  In the same month, I purchased 6,500 AirAsia shares with an average price of RM2.7578 mainly due to this. So far, Axis REIT is down to RM1.65 per share, AirAsia has shot up to RM3.13 per share.

So! Moving on to the whole point of this site – Dividend Income.

As usual, we will be comparing the dividends received with March 2016’s where I received a total of RM880.69 in dividends. The same month this year, I received a total of RM455.37 in dividends, a 48% decline. A few factors contributed to this new figure.

First, last year, CBIP declared a special one-time RM560 dividend. Secondly, I added Scicom Berhad to my portfolio this time around. More on that later.

Sunway REIT

This Month’s Dividends – RM287.37

Total 2017 Dividends – RM287.37

Dividend Yield – 1.45%

Weight – 6.53% of the Freedom Fund

Same time last year, Sunway REIT declared a RM320.69 dividend. Compared to this year’s dividend of RM287.37, that’s a 10% decrease. I’d attribute this decline to their recent acquisition of new assets. Share price and investor sentiment has remained positive for the stock.

Scicom Berhad

This Month’s Dividends – RM168

Total 2017 Dividends – RM168

Dividend Yield – 0.96%

Weight – 4.91% of the Freedom Fund

I purchased shares in Scicom back in October 2016. They’re a digital solution provider for huge prominent corporations. To name a few (thank you reader CHC for providing these): Huawei, Lenovo, Pepsi, Tesco, BMW, Samsung, Astro, Airasia, Fonterra,  Singtel, Dunhill, McDonald’s, Petronas, Mandela, CTOS, Axiata, Toshiba, Digi and many, many more.

My only regret is that I didn’t purchase more of Scicom’s shares back when the price was low. As of today, the share price has reached RM2.37 and I’m up by 14% already. The dividends from Scicom are decent, I’ll probably expect a 3% yield as of now. Moving forward, I’m expecting great things from Scicom.

End.

To sum it all up, total dividends for the month is RM455.37. Currently, dividend yield stands at 1.19%. 

Looking at last year’s list, there will be even less dividends to collect in April and probably none in May.

IGB REIT’s AGM in April will be something I’m looking forward to. Also Nestle’s goody bag collection. Drop me a PM or comment and let me know if you guys are heading for those as well!

As always thank you for reading.

February

With the 48% increase in dividends for me last month, I was of course pretty stoked and looking forward to February’s dividends.

And guess what? The anticipation wasn’t unfounded. I received RM2,081.80 in dividends for February. Compared with the same month last year where I received RM1,635.72, that’s a 27% increase.

However, the more astute and observant readers will notice that this time, Public Bank’s dividends is included in February’s dividend income. So, excluding PBBANK’s dividends, our actual increase when comparing is only about 15%. I’m in no way downplaying 15%, believe me, 15% is Wunderbar!

Homeritz Corp Berhad

February 2017 Dividends – RM733.50

Total 2017 Dividends – RM733.50

Dividend Yield – 5.19%

Weight – 6.52% of the Freedom Fund

A flat 20% increase in dividends from my favorite furniture making company. Revenue from exports has shot up thanks in part to the weak ringgit.

Public Bank Berhad

February 2017 Dividends – RM192

Total 2017 Dividends – RM192

Dividend Yield – 1.73%

Weight – 3.36% of the Freedom Fund

No comparison here as I purchased PBBANK only in March last year. On track to receiving more than 3% in dividends this year though.

IGB REIT

February 2017 Dividends – RM885.10

Total 2017 Dividends – RM885.10

Dividend Yield – 2.95%

Weight – 10.26% of the Freedom Fund

IGB REIT’s February dividends rose by 15.5% compared to the same month last year. Prices are at an all-time high so I won’t be buying more of it for now. The retail REIT already makes up more than 10% of my total portfolio anyway.

Axis REIT

February 2017 Dividends – RM271.20

Total 2017 Dividends – RM271.20

Dividend Yield – 1.12%

Weight – 9.05% of the Freedom Fund

An increase of almost 5% in dividend yield from the industrial-focused REIT.  I’m expecting good things from AXIS in the coming years. The price right now is within range for me to add more units.

End.

To sum it all up, total dividends for the month is RM2,081.80. Currently, dividend yield stands at 1.04%.

Looking forward to March and then the dividends will start to slow down for a bit.

How’d everyone do for the 2nd month of 2017? Did your dividends keep up with inflation? 

January

My Freedom Fund is off to an amazing start for the year 2017. The first month of the year of the rooster netted me RM1,180 in dividends from Scientex and CBIP. Compared to the same month last year where I received RM794 in dividends. That’s a whooping 48% increase in dividends for me. I did not increase my stake in either companies, the increase was from sound business conducted by them.

Scientex Berhad

January 2017 Dividends – RM760

Total 2017 Dividends – RM760

Dividend Yield – 3.41%

Weight – 14.68% of the Freedom Fund

As most of you regulars would know, Scientex has been one of the top performing company in my portfolio. I’m always on the lookout to add more of their shares but the price is never right. Maybe a big market crash is the only time I’ll ever get to buy more Scientex.

Back in January 2016, Scientex gave me RM494 in dividends. Fast forward a year to January 2017, they are now churning out RM760 in dividends for me. If you’ve not caught on by now, that’s a 53% increase. I’ve had Scientex in my portfolio since 2014 and the dividends have been increasing ever since. If you’re looking for a fundamentally sound business, keep an eye out for a buy opportunity here with Scientex.

RM760 in dividends translates to a 3.41%. Already at 3.41% and we have another round of dividends to look forward to later in August.

CBIP Berhad

January 2017 Dividends – RM420

Total 2017 Dividends – RM420

Dividend Yield – 1.88%

Weight – 7.84% of the Freedom Fund

As usual, the dividend voucher from CBIP has yet to arrive (same occurrence last year).

The company’s dividends back in January 2016 stood at RM300. The increase to RM420 this year represents a 40% growth. Apart from Scientex, CBIP has been performing wonderfully for me. I expect good things from the company and looking forward to another round of dividends later in July.

End.

Total dividends for the month is RM1,180. Currently, dividend yield stands at 0.38%. It’s only the first month of the year but it’s looking good.

How was the first month of 2017 for most of you? I’d love to hear from you guys on how your investments did in January.