From Madam X, a viewer who wrote in by email
Madam X is in her 70s and still teaches private tuition. She and her daughter, in her late 20s, own a freehold landed home in an upmarket area worth about RM1.3 million, bought with a 95% down payment, and keep a flexi loan and some cash for emergencies. The daughter earns about RM3,000 a month plus RM500 from a part-time job, and should clear the remaining loan in about eight years.
Is it sensible for the daughter, after her mother has passed away, to rent out the house for about RM3,000, buy a RM300,000 to RM350,000 condo near work, and do her own repairs to save money?
“Simple life does not come cheap.”
Sean wouldn't lock the daughter into a plan. She could simply keep living in the house, and should first work out what she wants; if she does invest, a loan works better than cash, and she should buy as soon as a unit's rent covers its instalment rather than wait.
Why
Cash loses value faster than it seems
Official inflation is about 2.3%, but Sean puts his own at 10 to 11% a year, and fixed deposits pay only around 2%. He suggests keeping three to six months of expenses as an emergency fund and putting the rest into assets you understand.
Property bought in cash is a weak investment
NAPIC data shows landed homes across Malaysia rising about 2 to 3% a year on average, less than EPF or blue chips have returned. Property is also slow to turn into cash: even after you agree a sale, the money takes about six months to arrive.
Property pays when you borrow
It is one of the few assets you can buy with up to 90% financing. The daughter could refinance the paid-off house, or take a loan on a RM300,000 condo now if its rent covers the instalment, and use her savings elsewhere. Sean counts insurance as part of the cost, so loans don't become a burden on the family.
Let the next generation choose
A carefully planned portfolio can become a burden if a child's life goes elsewhere. Sean would rather parents act as the safety net while children find their own goals, and says that time spent earning more is often better than saving on plumbers and electricians.
What to do
- Keep three to six months of expenses as an emergency fund, and invest the rest in assets you understand, such as index funds, EPF or ASB.
- If you buy property to invest, use a loan rather than cash, and count insurance as part of the cost.
- Buy an investment unit only if its rent covers the instalment; if it does, there is no need to wait.
- Let your children decide what they want before handing them a plan or a property portfolio.
- Pay professionals for repairs if your time can earn more than their fee.
Editorial Note: Summarised from Sean Tan's full episode. The quoted answer is in his own words; the rest is our paraphrase. Figures reflect the recording date, so check current rates and rules before acting on them.
ASKING SEAN #314 | LEAVING MORE THAN JUST PROPERTY BEHIND
Sources & Verification Data
Summarised from Sean's full English captions for Asking Sean #314. The quoted answer is verbatim; everything else is paraphrased. Figures are as stated in June 2026.
