“Four months ago, I had X amount of cash reserves in my emergency fund. Fast forward to today, and a portion of that amount's value is now gone, thanks to the continued fall of the Ringgit.” Does that sound familiar to you? The fact is, this story is more common than you think and now, the analysts are predicting that we'll see RM 100 = US$ 25 before the year ends. See for yourself.
The ringgit's depreciation has taken its toll on a lot of things, from the government budget and right down to our everyday purchasing power. In theory, the government is doing what it can to solve this problem, which is of course due to unforeseen external factors (falling global oil prices, China’s currency devaluation and more).
But for every problem, there is an opportunity. The ringgit may have lost its value, but here are some key factors that present themselves as "opportunities" for the future.
If you are from nearby Thailand or Singapore, the weak ringgit is an opportunity for you to have a quick getaway to Kuala Lumpur. Tourism is a huge industry in Malaysia and the boost in local tourism will most likely keep the local currency from falling even further. Alternatively, if you’re Malaysian and traveling abroad, now is the perfect time to make use of your air miles points if you have them. You wouldn’t want to exchange your ringgit to more expensive currencies at this point.
Online Freelance Work
By now, everyone's familiar with the concept of freelance work. When you do this online and your medium of payment is through PayPal, you will most likely get paid in US Dollars. Try to get a fixed rate (in USD) for your online freelance work. As the value of the ringgit fluctuates against the dollar, the money you get in dollars will make you have more purchasing power once you exchange it with local currency.
Invest For The Future
There is an old story, where a person during the financial crisis of '97, bought all those stocks whose value had diminished. Of course 10 years later, these companies have regained their strength in the stock market. He bought those companies' stocks, and years later, the value of those has gradually increased over time. Rewarding isn’t it?
If you are reading this blog, then you probably know the difference between a stock trader and an investor. The stock trader monitors the market consistently, daily, or even by the minute! The perfect timing on when to buy or share the stock will spell the difference between victory and defeat. The investor isn't like that. He invests on what he feels are good companies, depending on its history and performance over time. There is a certain science to this, and I will advise you to monitor the market and read blogs like this one.
This article is prepared by Michael Vincent Mislos on behalf of CompareHero.my, Malaysia’s premier financial comparison portal.