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Why I don’t save money physically (coins and paper money)

Physically saving money were one of the most straight forward way to build your stash. It may be easy, but it is not the best way to do.


1. You will not get any interest by saving physically.
Keeping your money inside your bank account may generate very minimal interest, but at least there is something. You may also save your money in the form of fix deposit, which will give you around 3-4% based on the bank’s offering. 

2. The money value will shrink year by year.
Inflation will cause your money value to depreciate yearly. Let’s assume the inflation rate is around 4%, saving RM 100 physically will reduce your buying power to RM 96 by the next year. 10 years down the road (assume same inflation rate), your RM 100 will only values around RM 60. The best way to fight inflation is to invest your money.


3. You spend time to calculate your money (especially coins).
Recently I have sort out and cleared the coins at my house. The total weight of the coins is around 1.5kg, and I spent around 1 hour to sort it out. The total values of coin is around RM 50. That being said, if you have a lot of coins lies around in your house, spending time to sort out the coins to exchange for paper money will give you RM 50 plus minus per hour. Otherwise, you can also buy a coin sorter (around RM 150) to sort your coins. When you have cleared all your coins, stop collecting it. It was a waste of time and effort to calculate coins that you already own. Unless you are doing business that needs to have coin for exchange, keep your coin collection small and handy as per your need.

4. You may lost your money.

 People might steal your money if they know where you kept it. Termites might eat your money too. Your money is guaranteed by Bank Negara if you save money in licenced Financial Institution.

So how to save money and maximize your saving?
  1. Save money in digitize account that you can view online. You can get to know your finances details on your fingertips.
  2. Plan for your budget and pay for yourself first every time you receive your income. Transfer the money you need to save in a separate account, or invest wisely. You do not need to resort to tips and tricks to save money physically.
  3. Invest. Invest. Invest.



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