Saturday, January 14, 2012

Cost of Delay - Senario 2


1. Estimated Tuition Fees per Course for 3+0 Degree Business Programs at Private Colleges /Private Universities in Malaysia at year 2011 is around RM43,000 - RM75,000 and estimation for the living expenses is around RM1,000 - RM1,500 per month. Let say we take an average figures, RM60,000 for the tuition fees and RM45,000 living cost for 3 years. Total amount = RM105,000.

2. Assume inflation = 4%. Base on rules of 72, the amount will be doubled at 18 years. Total cost needed after 18 years = RM 210,000.

3. Both Prospect A and B are age 1, their parents want to save for their education by the age of 18.

4. Prospect A is saving payment amount of RM5,800 with 8% interest start from age 1.

5. Prospect B delays his saving 5 years later with the same interest as Prospect A.


1. Prospect A and Prospect B gets RM211,411.44 and RM211,101.56 respectively at the age of 18.

2.To get around the same savings balance with a 5 years delay, the amount invested of prospect A is RM98,600 and the Prospect B is RM123,600.

3. Prospect B would need to pay RM10,300 per year instead of RM5,800 and total extra amount invested RM25,000 just because of 5 years delay.

Click to enlarge the picture

Click to enlarge the picture

The sooner you start, the lesser you need to pay. ;)


Tan Min Chin, CH3

No comments:

Post a Comment