Skip to main content
  • EN
  • BM
  • Search
  • AIA Malaysia
  • Our Products
    • Life Protection
    • Medical Protection
    • Critical Illness Protection
    • Savings & Investment
    • Accident Protection
    • Property Solutions
    • Motor Insurance
    • Online Products
    • AIA Vitality
    • Employee Benefits
    • Commercial Insurance
  • AIA Vitality
    • How It Works
    • REWARDS & BENEFITS
    • Member’s Testimonial
    • Join AIA Vitality
  • What Matters
    • Health & Wellness
    • Finance & Insurance
    • Video Gallery
    • Mental Wellbeing
    • Health Statistics
  • About AIA
    • About AIA Bhd.
    • About AIA Public Takaful Bhd
    • About AIA General Berhad
    • About AIA Pension & Asset Management
    • Career Opportunities
    • Community & Partnerships
    • Media Centre
    • Events & Promotions
    • Customer Charter
  • Help & Support
    • Contact Us
    • Locate Us
    • Claims Process And Guides
    • Premium Payment
    • FAQ
    • Important Announcements
    • Form Library
    • How to Guides
  • My AIA
    • CUSTOMER LOGIN
    • CUSTOMER REGISTRATION
    • CORPORATE LOGIN
  • Investment-Linked Funds
AIA
  • Our Products

    Our Products

    Select from one of the categories on the right or click here for a recommendation based on your needs.

    Let us help you
    Investment-Linked Funds

    Get the latest updates on our funds and their performance.

    Click here to view AIA Investment Linked Funds Performance Report 2021

    For Individuals

    For Business

    • Life Protection

      Protect yourself and your loved ones from life's uncertainties with AIA's life insurance and takaful plans.

    • Medical Protection

      Avoid unforeseen medical expenses with AIA's medical insurance and takaful plans.

    • Critical Illness Protection

      Focus on your recovery and not your financial commitments when you have AIA's critical illness insurance or takaful plans.

    • Savings & Investment

      Stay protected while you secure your future with AIA's savings and investment plans.

    • Accident Protection

      Safeguard yourself from accidents with AIA's personal accident insurance plans.

    • Property Solutions

      Finance your dream property and ensure your household contents are well-protected.

    • Motor Insurance

      Get comprehensive protection for your motor vehicles.

    • Online Products

      Sign-up for our insurance and takaful plans online for immediate protection.

    • AIA Vitality

      AIA Vitality is the science-backed wellness programme that works with you and rewards you for the healthy choices you make. Find out more

    • Employee Benefits

      Secure your company's most important asset through our market-leading solutions.

    • Commercial Insurance

      Secure your business against mishaps and damages.

  • AIA Vitality

    AIA Vitality

    We support you in taking charge of your health.

    FIND OUT MORE
    • How It Works

      Discover how AIA Vitality motivates you to make healthy choices sustainably.

    • REWARDS & BENEFITS

      Find out what are the rewards and benefits that you can enjoy as an AIA Vitality member.

    • Member’s Testimonial

      Be inspired by the stories of our members 's journey with AIA Vitality

    • Join AIA Vitality

      Kickstart your journey towards better health today!

  • What Matters

    What Matters

    Guides and tips on the latest Health & Finance topics.

    VIEW ALL IN WHAT MATTERS
    • Health & Wellness

      Wholesome & healthy living starts today.

    • Finance & Insurance

      Discover our wide range of insurance and finance topics

    • Video Gallery

      Short videos on the latest Health & Finance topics.

    • Mental Wellbeing

      Start taking care of your mental health today.

    • Health Statistics

      Learn more about the current health statistic.

  • About AIA

    About AIA

    For almost a century, AIA has served the ever-changing needs of millions of people all across the Asia-Pacific region.

    Read More
    • About AIA Bhd.

      Who we are, what we do, our vision and awards.

    • About AIA Public Takaful Bhd

      Who we are, what we do, our vision and awards.

    • About AIA General Berhad

      Who we are, what we do, our vision and awards.

    • About AIA Pension & Asset Management

      Who we are, what we do, our vision and awards.

    • Career Opportunities

      Interested to join our AIA family? Look for a role that suits you.

    • Community & Partnerships

      Giving back to the community is important to us.

    • Media Centre

      Financials, press releases and other info about AIA.

    • Events & Promotions

      Events & Promotions

    • Customer Charter

      Our Commitment to our Customers

  • Help & Support

    Help & Support

    We strive to assist you with any inquiries you might have with a high touch customer service experience.

    Contact AIA
    • Contact Us

      Cannot find the answer in our FAQ section? Contact us now.

    • Locate Us

      Find us and our panel healthcare partners on Google Map

    • Claims Process And Guides

      Find Claims related information and guides here.

    • Premium Payment

      Find information and guides on how to pay premiums here.

    • FAQ

      Have a question? You may find the answer here.

    • Important Announcements

      Useful information for our customers

    • Form Library

      Need a form? Check our form library.

    • How to Guides

      Learn how to perform self serve transaction online at My AIA Portal.

  • My AIA

    My AIA

    Manage your AIA plans, employee benefits, stay healthy with AIA Vitality, and access healthcare services.

    Download My AIA
    Download My AIA
    Download My AIA
    Download My AIA
    • individual
      CUSTOMER PORTAL

      Manage your AIA plans, employee benefits, stay healthy with AIA Vitality, and access healthcare services.

      Register Login

    • corporate
      CORPORATE PORTAL

      For HR personnel and Intermediaries to manage the company's employee benefits portfolio effectively.

      Login

  • Language Select
    • EN
    • BM
  • Search
  • Contact Us
    • Contact Us

      Operating hours during Ramadan :
      Monday - Friday: 8.30am - 4.30pm

    • AIA BHD.

    • AIA PUBLIC TAKAFUL BHD.

    • AIA General Berhad

    • AIA Roadside Assist

Finance & Insurance
Prev | Next
Back to Top
  • {{title}}

    {{label}}
  • SETTING UP YOUR EMERGENCY FUND AND SAVINGS

    14 July 2020

    What is an Emergency Fund?

    rescue-money-save-help-drown-aia-malaysia

    An emergency fund is money set aside for unexpected (usually large) expenses. Some good examples are – medical expenses, car repairs and maintenance and of course unemployment.

    With the recent Covid-19 pandemic, it isn’t hard to imagine yourself in a situation where you’ve just been laid off. Then imagine a week later, your car breaks down and you’re unable to attend job interviews. Sure, there is public transport and ride-hailing services but wouldn’t it be better to have that safety net for such unexpected situations?

    Another common scenario is when one is hospitalised and is either uninsured or his/her illness isn’t covered under their current protection plan. What is one to do in such a situation if money is an issue? An emergency fund, if set up properly will be sufficient to weather you through these unfortunate events.

    While we’re on it, there is a big difference between regular savings and your emergency fund. There must be a distinction between the two. Your emergency fund has to be absolutely liquid and only used during a genuine emergency. While your regular savings can be placed in less liquid instruments and it will eventually be utilized to invest in assets.

    Why is an Emergency Fund important?

    business-team-protection-umbrella-lightning-aia-malaysia

    From a financial standpoint, having an emergency fund acts as a buffer. Without it, you’ll be forced to liquidate your investments to solve your immediate emergency conundrum. And more than likely, it may not always be a good time to sell off your stocks or your investment property.

    As a long-term stock investor, I plan to hold on to my stock investment for years. An emergency fund is vital for me to prevent unnecessary liquidation of my portfolio at an unsuitable time.

    As mentioned earlier, peace of mind comes hand in hand with an emergency fund. Knowing that you’ve got some money squared away for a rainy day will help mentally. It’ll give you the confidence to take risks and make bold investments which you’ll never take if you didn’t have that safety net.

    Most important of all, you’ll be able to make better financial and investment decisions when you have money saved up for emergencies.

    How Big Should my Emergency Fund be?

    Your emergency fund can be calculated in two ways. You either base it off your monthly expenses or your monthly income. Personally, I base mine on my monthly income.

    As a rule of thumb, you’ll want to have 3 to 12 months of your monthly income saved up for emergencies. I suggest starting small, start saving up for 3 months, go to 6 and if you still want a bigger safety net, go for a year’s worth.

    Personally, I have a 24-month emergency fund stashed away. I started off with a 6-month emergency fund. And as my investment portfolio grew, I eventually increased it to a 12-month and then a 24-month emergency fund. 

    How to Set Up Your Emergency Fund.

    box-money-hand-aia-malaysia

    Before even thinking of investing, it is my opinion that you should have your emergency fund set up first. Because, as I’ve mentioned, you want to make sure you don’t have to liquidate those investments in times of need. You don’t want distractions. You want to have that razor-sharp focus when making your investing decisions.

    If you don’t already have an emergency fund set up, the very first step is for you to take out money from your savings, if you’ve got your 6 months’ worth right there, you are set. If not, you’ll have to save up. And then only do you think of investing.

    Your next question should be – where do I put my emergency fund?

    First, you’ll want it to be as liquid as possible. At the same time, it has to be generating interest for you because, an emergency fund could come up to a sizeable amount. For example, a RM5,000 a month salary man could have a 12-month emergency fund of RM60,000.

    Fixed Deposits

    Personally, I put mine in short term 1-month fixed deposits. I practice something called FD Laddering.

    It is basically breaking that RM60,000 into a few FDs on different days of the month. This helps you lose less interest when liquidating. 

    Money Market Fund

    An alternative to fixed deposits for your emergency fund would be a money market fund. A money market fund is essentially a mutual fund that invests in very liquid assets such as cash, cash equivalent securities, and high credit rating debt-based securities with a short-term maturity.

    High Interest Savings Account

    There are some savings accounts that offer high interest and can be a good alternative to fixed deposits. There are usually some conditions to fulfill before you’re eligible for the high interest.

    What Comes After I’ve Set up my Emergency Fund?

    moneybag-money-coins-aia-malaysia

    Save, Save and Save!

    Congratulations, you’ve got your emergency fund set up, what’s next? Continue saving.

    I cannot stress how important savings are in the wealth building process. Without saved up capital, you won’t be able to take advantage of a market downturn when it comes around.

    As a stock investor, my purchase price determines if I’m making the right buy. Price and value of a stock is everything as I hold my stocks for the long term.

    If you, like most people have trouble saving, you might want to check out a few articles in AIA’s database on savings. Insurance companies like AIA offer saving plans specifically for this reason.

    Below are some helpful articles on savings by AIA.

    https://www.aia.com.my/en/what-matters/finance/track-expenses-save-more.html

    https://www.aia.com.my/en/what-matters/finance/5-rules-of-financial-management.html

    https://www.aia.com.my/en/what-matters/finance/saving-money-expectations-vs-reality.html

    Investing

    After saving, you’ll then want to invest. Pick an asset and pick an industry you’re familiar with.

    Invest in what you’re comfortable with and invest in an asset that you know and understand. Invest with a goal – is it a monthly stream of passive income you’re looking for? Or maybe your goal is to own assets that appreciate over time like properties. Whatever it may be, you have to invest in assets.

    For me personally, I invest in stocks and the dividends I receive from stocks are my passive income. It is what I know, and it has been my passion for the last 10 years. It still is.

    I guarantee you that you’ll make better financial decisions with your emergency fund set up. So, get to it if you haven’t already. As always, onwards and upwards!

    The above articles are intended for informational purposes only. AIA accepts no responsibility for loss which may arise from reliance on information contained in the articles.

    Leigh

    Leigh

    Leigh is an investment and personal finance author at https://dividendmagic.com.my/

    He is a Certified Financial Planner and a value investor with a portfolio mainly consisting of stocks.

    Related Articles

    Saving Money: Expectation vs Reality


    Whether you’re saving money for a vacation or to pay the bills, there’s always the expectation of a massive blow to your bank account, and yes, it hurts.

    When is the Best Time to Save & Invest?


    How far do you think you can stretch RM50? Not very far, especially in today’s conditions.

    11 December 2019

    How To Keep Those Golden Years Shining


    Most of us work hard all through our adulthood to achieve a peaceful and relaxing retirement but have you ever considered how much retirement money you actually need in order to have a safe and secure post-work life? Factors such as your intended lifestyle, your earning power and healthcare play a big part into retirement and if you have not started to plan it now, you better. Here are some suggestions how.

    Recommended Products

    Savings & Investment

    BASIC

    A-Enrich Wealth

    Savings & Investment

    A short-pay savings plan to maximise return that comes together with protection and investment elements.

    vitality

    Savings & Investment

    BASIC

    A-EnrichGold

    Savings & Investment

    A short-pay savings plan that offers guaranteed cash payments and potential investment gains.

    One Second Survey
    One Second Survey
    ×
    One Second Survey

    How important do you think it is to have an emergency fund?

    Our Products
    Life Protection
    Medical Protection
    Critical Illness Protection
    Savings & Investment
    Accident Protection
    Property Solution
    Motor Insurance
    Online Products
    Our Products
    Life Protection
    Medical Protection
    Critical Illness Protection
    Savings & Investment
    Accident Protection
    Property Solution
    Motor Insurance
    Online Products

    This website uses cookies for the purpose of enhancing your user experience. You can find more information on the types of cookies we collect, what we use these for, and how to manage your cookie settings in our Cookies Policy and Privacy Statement.

    What matters
    Health & Wellness
    Finance & Insurance
    Video Gallery
    Mental Wellbeing
    Health Statistics
    About Us
    About AIA Bhd.
    About AIA PUBLIC Takaful Bhd.
    About AIA General Berhad
    About AIA Pension and Asset Management Sdn. Bhd. 
    Careers
    Community & Partnership
    Events & Promotions
    Sitemap
    Help & Support
    Contact Us
    FAQ
    Important Announcement
    Form Library
    AIA Malaysia
    Menara AIA, 99, Jalan Ampang,
    50450 Kuala Lumpur
    AIA Bhd.
    1300-88-1899
    For Overseas Customers
    603 2056 1111
    AIA PUBLIC Takaful Bhd.
    1300-88-8922
    AIA General Berhad
    1300-88-1899
    AIA Pension and Asset Management Sdn. Bhd.
    1300-22-7771
    AIA Auto Assist / Roadside Assist
    1-800-88-8733
    What matters
    Health & Wellness
    Finance & Insurance
    Video Gallery
    Mental Wellbeing
    Health Statistics
    ABOUT US
    About AIA Bhd.
    About AIA PUBLIC Takaful Bhd.
    About AIA General Berhad
    About AIA Pension and Asset Management Sdn. Bhd. 
    Careers
    Community & Partnership
    Events & Promotions
    Sitemap

    This website uses cookies for the purpose of enhancing your user experience. You can find more information on the types of cookies we collect, what we use these for, and how to manage your cookie settings in our Cookies Policy and Privacy Statement.

    Help & Support
    Contact Us
    FAQ
    Important Announcement
    Form Library
    AIA Malaysia
    Menara AIA, 99, Jalan Ampang,
    50450 Kuala Lumpur
    AIA Bhd.
    1300-88-1899
    For Overseas Customers
    603 2056 1111
    AIA PUBLIC Takaful Bhd.
    1300-88-8922
    AIA General Berhad
    1300-88-1899
    AIA Pension and Asset Management Sdn. Bhd.
    1300-22-7771
    AIA Roadside Assist
    1-800-88-8733
    www.aia.com.my/roadsideAssist

    Copyright © 2023 AIA Group Limited and its subsidiaries. AIA Bhd. 200701032867 (790895-D) AIA PUBLIC Takaful Bhd. 201101007816 (935955-M) AIA General Berhad 201001040438 (924363-W) AIA Pension and Asset Management Sdn. Bhd. 201201027147 (1011637-P) AIA Health Services Sdn. Bhd. 199601016211 (388561-T). All rights reserved.
    Terms of Use | Privacy Statement | Code of Conduct | Sitemap