By clicking “Check Writers’ Offers”, you agree to our terms of service and privacy policy. We’ll occasionally send you promo and account related email
No need to pay just yet!
About this sample
About this sample
Words: 1286 |
Pages: 3|
7 min read
Updated: 16 November, 2024
Words: 1286|Pages: 3|7 min read
Updated: 16 November, 2024
Future investment can be categorized as an important component in our lives. One of the ways to ensure future financial security is by practicing saving. Most young people nowadays do not realize the power of saving for their future, which can transform small daily savings into significant amounts over time. According to the American Bankers Association (2013), “Invest a little for a long time and you end up with a lot,” these practices can truly help us when we need them. This is all about planning our lives from a young age.
“Putting off your wants now for a future reward is the key to reaching your goal. It will be a lot easier to save your money if you know what you’re saving for.” (American Bankers Association, 2013). From the statement above, the key to maintaining saving as a priority is setting our minds to discipline ourselves to do it. Thus, saving becomes a habit and a commitment that encourages us to save without hesitation. This is supported by Personal Wealth Advisory (2016), which states that “One key to financial independence is a disciplined mindset.” Instilling this mindset in children is crucial, as it is easier for them to build habits such as financial discipline when they are young. Without this mindset, saving can become a task, and tasks are often postponed and eventually fail. When saving becomes a habit, it is the best time to improve the saving rate and consistently enhance it.
The most important question that leads us to save for the future is: how will you pay for an emergency? This question also answers why we must save. Some tips for saving include setting your goal first, whether it be a short-term or long-term goal. Saving helps us in the future by providing a financial safety net.
Furthermore, one advantage of saving is creating a financial backup for retirement. However, many students do not realize the importance of saving for the future. The government should influence young people regarding saving behavior. There are many ways authorities can attract young people to save. One method is establishing schemes that offer beneficial rewards, like Bank Simpanan Nasional’s (BSN) SSPN. As noted, “Investing in bringing youth into the financial system at a young age should help create a generation of adults with stronger money management habits.”
The next step in future investment is expanding your savings wisely. There are many ways for students to invest their money properly. One option is investing in business or entrepreneurship. Our beloved prophet Muhammad was an entrepreneur and encouraged us to follow this path. The Quran states, “And when the prayer has been concluded, disperse within the land and seek from the bounty of Allah, and remember Allah often that you may succeed” (Surah Al-Jumu’ah). Even the noble Quran advocates entrepreneurship as an effective way to grow wealth. As Muslims, we must adhere to Shariah compliance to receive rewards in this world and the hereafter.
Besides entrepreneurship, there are many platforms to grow our money. Nowadays, we can invest our savings in unit trusts. One of the most popular unit trusts in Malaysia is Amanah Saham Nasional Berhad (ASNB). The government of Malaysia encourages citizens to use this investment as a future investment tool. This platform is also approved by the Securities Commission Malaysia, which ensures that trading investment companies adhere to Shariah compliance. Moreover, most banks in Malaysia offer Islamic banking services.
Additionally, some students are exposed to the real investment world. The existence of Bursa Malaysia is one way to invest. However, before investing in stock trading, one must understand the pros and cons of this platform thoroughly. The same goes for trading in cryptocurrencies, which gained popularity with Bitcoin and Ethereum. This blockchain technology differs from the stock exchange process as it lacks a proper policy guided by world banking institutions, making it risky. However, many traders are attracted to this platform because of the high-profit potential. Pamane and Vikpossi (2014) note, “Investments with high levels of systematic risk can be expected to produce a high return.” This statement is agreed upon by economists worldwide, which is why people still invest in cryptocurrency despite knowing the risks. Understanding market flow and economic conditions can provide an advantage in estimating market movements. As students, we must explore how the real world operates as much as possible. Birgitt Flohr (1997) wrote, “All our knowledge is founded” in “experience,” indicating the importance of continuous learning about life.
According to Investopedia, wealth is defined as the value of all the assets owned by a person, company, or country. Wealth is determined by calculating all tangible and intangible assets and the capability of the individual or firm to consume goods and services. Essentially, it is the sum of all property. Personal wealth growth planning should start early by understanding wealth management concepts and the relationship between purchasing power and consumer behavior. These ideas are crucial knowledge that students must acquire to manage their property effectively, and they are essential for becoming successful individuals.
A study conducted by Sarah Cormack (2014) indicates that parents should allow their children to manage their wealth. They must be responsible for their actions regarding money. Young people nowadays often depend on their parents’ wealth. While wealth can be inherited, are they ready to manage it properly? Good strategies must be employed to avoid pitfalls and apply the best practices moving forward. Cormack (2014) states, “Great wealth is matched equally by challenges.”
Islam emphasizes helping others, as everyone in this world is our responsibility. Consequently, Zakat has been introduced to assist those entitled to receive it, such as students, the poor, and those in significant debt, collectively known as “asnaf.” All our actions are observed and evaluated, so it is essential to place wealth in the right areas.
Effective wealth management involves cash flow planning for each transaction. This strategy helps understand financial capability without using surplus money. Although controlling consumption may be challenging, it is crucial for future investment. Equally important is investment planning and management. As mentioned earlier, we must determine which type of investment suits us, whether active or passive. As students, passive investment is recommended, such as opening a savings account in ASNB or other low-risk unit trust institutions. This investment plan depends on your goals and willingness to take risks.
Browse our vast selection of original essay samples, each expertly formatted and styled