By Jessica Wee

Adulting officially starts when you get your first job after graduation. Assuming that your first paycheck does not amount to much (RM2,500/US600), how should you spend it?

If your first instinct is not to spend it all, I applaud you for discovering our blog – taking your first step to finding financial independence(FI/RE movement) instead of aspiring to retire at 60 years old which most of us end up doing.

I remember clearly when I graduated, I never realized how important a sound financial management plan was. More importantly, no one spoke to me about it!

Back then, I simply thought that financial management was about having a monthly paycheck coming in on time and saving as much as you can. A sense of insecurity kicked in when I started planning for my future which seemed to be filled with uncertainties.

How much savings will be enough? When will I be ready to take on the responsibility of having my own family? Can I afford a car with my current salary and expenditure? Is there a possibility that I can retire earlier than the age that the government has told us to?

With all these questions in mind, I came to realize the importance of financial planning, and how it is interconnected to every single decision in our lives. Financial planning is not about finding out which product is the best in the market, or which investment gives you the highest return, but a set of values to help us achieve our financial goal comfortably and systematically.

What to prioritise with your fresh graduate’s paycheck? 

  1. Budgetingthe basic rule is dividing up after-tax income and allocating it to the ratio of 50 (Needs): 30 (Savings & investments) : 20 (Wants)
  2. Medical card – the basic health care provided by the Malaysian government is fortunately accessible and of reasonable quality. If you are working for a company, they will most likely have some coverage on medical claims. However, there is no guarantee how long you will be at your job and if you face a life threatening situation that needs specialised care, you would not want to make a dent into your own/family’s financials. Getting a medical card is a good way to avoid financial ruin in the event you need it.
  3. Emergency fund – a general rule of thumb is to save a total of 6 months worth of expenses in the event that you lose your job and this would give you a buffer to find a new job. 
  4. Study loan – even though study loans tend to have lower interest rates, make it a good habit to make monthly payments so that the amount does not accumulate. Compounding works on savings, it also works on loans.
  5. Investments – Pay yourself first! After you have saved for your 6 months emergency fund, you need to start investing monthly and the most effective way is by DCA (Dollar Cost Average). Start by assessing your risk profile to determine how much risk you can take without losing sleep. Then, device a plan on which asset class is most suitable for you, see

The most important lessons I learnt in my career is to find a mentor, or two. Often when you are starting out in the working world, you may feel lonely, lost or that no one understands your goals. To start off on the right footing, you can:

  1. Be proactive to seek out people in your field of work that you deem are successful and that you admire
  2. Clarify your career, financial and life goals with your mentor(s)
  3. Meet consistently with your mentor on a monthly or quarterly basis
  4. Ask for feedback and act upon the feedback of your mentor(s)
  5. Network with your mentor(s) and be open to career opportunities outside your current field of work.

I would really love to hear from you about your financial goals and the obstacles that you are facing so I can help you overcome them. Share your thoughts with me and drop me a message below!


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