ASB Loan Calculator

ASB Loan Overview

Taking a loan to invest in Amanah Saham Bumiputera (ASB) can be the important strategy of many brothers, who are poor, to becoming billionaire. Using ASB Loan is a method to leverage the investment either to gained the big number of money.

What is an ASB Loan?

The loans, available from many banks in Malaysia, are called ASB Loan. The loans allow Bumiputera investors to purchase ASB units by borrowing money from the banks. The government guarantees the loans, thus making them low-risk investments, especially since the return of ASB is always stable.

Benefits of an ASB Loan

There are several advantages to using an ASB Loan:

• Leverage: Borrowing to put into ASB lets you wield more capital than you might have. This can raise returns.
• Low Interest Rates: Interest rates that accompany ASB Loans are generally competitive, which helps to increase total profit.
• Tax-Free Dividends: Dividends earned from ASB investments are exempt from Malaysian income tax.
• Compounding Effect: If you use your dividends to buy more of the stock, or to pay down your loan, this can accelerate how fast your money grows over time.

How Does the ASB Loan Work?

The ASB Loan is just like a regular loan that allows you to purchase the ASB units. It can be an enormous sum, often between RM10,000 to RM200,000. For those with a good record and banks, the figure could be much larger.

Repayment and Dividends

Loan repayment is typically made monthly and can be structured in various ways:

• Interest-Only:Essentially, lending so much money to an investor that he/she will pay only the interest on the loans over an investment period (not the principle), until the principle is returned to the lender at the end of the term.Getting these loans is difficult.
• Principal and Interest Repayment:Monthly payments that cover both the interest that is due on the outstanding loan, as well as repaying some of the capital. You repay more and more of the capital over time as the loan reduces.

This allows the dividends earned on one’s ASB investments to be used to pay back the loan or to reinvest in more ASB units (to buy out existing partners and increase one’s holding), often magnifying the amount of the initial investment over time. In theory, this business style, if well run, can lead to high returns – especially when the dividend rate is higher than the interest rate on the loan.

Using the ASB Loan Calculator

The ASB Loan Calculator will provide a guide to the key financial results of an ASB on key financial outcomes when you fill in in dollar amount of the loan ($), length of the loan (years), interest rate (%) and a % return on dividends.

• Monthly Repayment: Servicing the loan requires you to pay this much each month.
• Total Interest Paid: Cost of the loan over the time period you are taking the loan are this much.
• Total Dividends Earned: This is the estimated total dividends you would earn from your ASB investment over the period.

Considerations Before Taking an ASB Loan

An ASB Loan can be a great tool for accumulating wealth but one should consider the following:

• Risk of Borrowing: there is some risk with every loan. Like when the dividend rate is less than the interest rate for your loan
• Loan Tenure: The longer time you take to pay back your loan, then the more interest you will pay. Please make sure you select a loan tenure that works with your financial plans.
• Financial Discipline: Punctual amortisation and prudent dividend practices are keys to reaping the maximum benefits of an ASB Loan.

Conclusion

ASB Loans opens doors to those who aspire to increase their financial growth. Bumiputera investors will find this one of the ideal assets by leveraging their capital and widening their channels of wealth. Using this system can increase investors’ financial higher ground BUMN’s advisors transact via ASB loans and showcase investors how to profit using tools like the ASB Loan Calculator.

Key Features of ASB Loans