Ok here goes, I have a big bike. It's a Royal Star Tour Deluxe and I have about RM13k of outstanding loan more to be paid up. Currently, I'm paying about RM500 plus for the loans and perhaps, I have another two more years of constantly paying up the installments. Plus, I have about RM22,000 of outstanding personal loan that I took from Bank Rakyat a few years ago. I took RM30,000 in 2005 and now is 2009 and I still have RM22,000 to be paid up(even after 3 years of constantly paying). I'm paying the bank about Rm500 plus per month for the loans. Then I was thinking to myself, Bank Rakyat is really good in eating up people's money via their interest rates huh? So, what if, I decide to finish off my bike's installment. Then, perhaps, sold it off. The market value of the bike now is about RM48k and it can go up till the RM50k range. So, if I decide to sell it off for RM48k, obviously I'll be bikeless and I'll be sacrificing one of my passions. Having said that, I'll save about RM1100, perhaps more if I decide to finish off those two 'loans'. That also means, I can put an additional RM1100 to my ASB. Currently, my monthly contributions to ASB is about RM500. So, if these two things go, my ASB will have a better and positive effect in the long run....(about RM1700 of monthly contributions) For illustrations purposes, RM1700x12=RM20,400. Plus dividend which is about 10%, the total will be RM22,400. Wow. Imagine how much I will earn and safe if these two things will go...
Having said that, upon receiving the RM48k, would it be wise if I could use that money to pay off my bank rakyat instead? I mean, literally finish off my bank loan to Bank Rakyat. So, I will have a cash balance of RM26k (more or less). So, what do I do with that RM26k? Take it as it is and get myself a smaller CC bike (a kawasaki ER6 would costs around that amount) or, be a little patience and put the whole lot (RM26k) to ASB which will ultimately increase the balance as well as the OD facilities. In addition, an increase in the ASB means I will have much more capital to play around with my '2nd step'....
So...what shall I do?...
Have a nice day...
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