August 06

Increase Your Wealth in Malaysia with 5 Types of Income

Eighteen months ago, most of us were skeptical about the pandemic and we took a lot of things for granted. Fast-forward to today, many of us are struggling to live each day with the aim of putting food on the table. Even then, some of us are searching for ways to earn more income so that we can afford to live in comfort with some of the investment plan in Malaysia.

Although wealth building may seem like an impossible mission, especially if you earn a regular income, it’s not that difficult to increase your wealth and be rich in Malaysia. In fact, you just need a systematic approach to get the ball rolling.

And since we’ve shared about Investment Planning Tips to Avoid Pitfalls as one of our previous articles, this time around we’ll be sharing how you can increase your wealth and be rich in Malaysia.

How to be rich in Malaysia?

There are many ways for you to increase your wealth in Malaysia. You can invest in the stock market, unit trust, P2P lending, real estate, or be an entrepreneur by starting up a business.

However, before you invest, you will need a solid investment plan that includes your financial goals and objectives. After which, you match them with your financial resources to determine the feasibility of your investment plan in Malaysia.

That said, there’s no easy ways on how to be rich in Malaysia because nothing worth having comes easy. Only after you’ve poured your soul along with hard work and sacrifices, can you reap the benefits of what you sowed.

Therefore, you need to put in the effort and learn about the many ways to be rich in Malaysia. Here are 5 types of income that can increase your wealth:

a) Active linear income

This type of income is derived from the exchange of physical labour and time with a single paymaster. It’s also the most common and simplest means of increasing your wealth because it requires the least amount of time, effort, and investment to establish.

When you’re starting to work, this type of income is the best but depends solely on your physical effort and may limit your career growth. After all, you only have one body, 24 hours a day, 365 days a year, and can only be at one place at a time. For instance, a private employee who is bounded by his/her full-time job at an agency or company.

b) Active scalable income

Similarly, active scalable income is derived from the exchange of physical labour and time but with a network of paymasters. This type of income involves having a system or team or even both to grow the income exponentially.

That said, this type of income is expandable because if you have skills that allow you to progress from active linear income to active scalable income, it’ll come in handy to help increase your wealth. For instance, a full-time copywriter taking on photography works outside of his/her day job.

c) Portfolio income

This type of income is derived from market value appreciation of your assets, also known as capital gains. Put simply, portfolio income is earned by investing in assets that are priced below their market valuation.

While this type of income appeals to many because of the prospects of earning capital gains, it can be a risky source of income if you only focus on the money instead of building your assets.

Some examples include buying a property or stock where the value either appreciates or depreciates over time.

d) Passive income

Compared to the previous three types of income, passive income is derived from your ownership of profitable assets such as fixed deposits, stock dividends, property rentals, and royalties.

What this means is that the income you get from these assets flows into your bank account without you having to exchange your physical labour. Essentially, it’s a type of income that gives you time to pursue what you like at your own pace. However, you need to invest in mental labour before you can be good at it.

e) Phantom income

Different from the types of income above, phantom income is derived through the leverage of tax benefits, corporate entities, and debt. It is known as such because the income is not receivable by cash but it creates a tax liability for an individual or partners.

Also, this type of income isn’t common as it can complicate the process of tax planning. Suffice to say, it is an income of the rich because it requires a high degree of financial intelligence to fully understand the concept and utilize it to a certain advantage.

In a nutshell, these are the 5 types of income that can help increase your wealth in Malaysia. It’s also a form of income progression for most wealthy families who began with very little. You can start with Gene App – an investment plan in Malaysia that works to multiply your wealth, manage and increase your digital assets.

You also get to earn a daily income and convert your earnings to invest in property and jewellery. Contact us at 011 6939 2180 or email your queries to [email protected] to find out more.