How To Spend Your Angpow Responsibly…And Still Treat Yourself!21 Jan 2023
Happy Chinese New Year! The time for family reunions, great food, and of course…getting that sweet angpow! It’s a tradition where married adults give red packets containing $$$ to children, teenagers, and unmarried adults. You can actually get a sizeable amount over CNY. How to spend it is a question we ask ourselves every year.
As most parents would advise when it comes to angpows, “Spend it wisely!” We’d recommend that as well! However, you don’t necessarily need to let go of treating yourself. Although there is no standard guideline, we recommend spending 80% of your angpow responsibly and 20% on treating yourself. Here are some tips to help you achieve that!
Pay towards debt
Since debts have interest rates, it's best to pay towards your debt amount sooner to lower your interest rate payments. If you can, fully pay off your debt like a boss!
You may start by considering paying towards your credit card debt, which is a high interest debt that’s common among Malaysians. According to The Credit Counselling and Debt Management Agency (AKPK) in 2019, a Bank Negara agency that helps Malaysians settle their debts, credit card loans account for 55% of its debt portfolio.
Set it aside as part of your emergency fund
One quick and easy way to use your angpow responsibly is to deposit it into your emergency fund. An emergency fund is savings that you set aside to cover unexpected expenses such as sudden unemployment or an emergency car repair during CNY travels. It gives you peace of mind during rainy days. An emergency fund can generally be considered as having about 6 months of expenses set aside and prevents you from taking a dip into your investments to cover sudden expenses. Avoiding that means you'd have a prosperous year instead of a financially challenging one.
Put in a fixed deposit
If you feel you may dip into your angpow on a whim, a fixed deposit is a good option for savings discipline. You won’t be able to withdraw from your fixed deposit without losing your earned interest. Interest rates from fixed deposits are also generally higher than that of savings accounts, falling between 2.9% to 3.5% per annum, with some being more. That’s higher than savings accounts which have low interest rates of 0.25% to 0.30% per annum.
Don’t let all the angpows go to waste from an unexpected event just because you did not get insured. Even a single RM50 angpow may get you insured for months with i2u insurance plans that include life, medical, and critical illness insurance, starting from only RM3.90 a month. Get an instant quote now!
Lastly, don’t forget to treat yourself!
Even spending the angpow responsibly can feel like a treat in itself. But if you have spent that 80% responsibly, the rest can be up to you! Imagine if you collected RM400 worth of angpows over CNY. 20% of that is worth RM80. That's at least 4 tubs of ngaku chips to snack on with CNY movies! The best way to treat yourself is to do it guilt-free. So don’t hold back.