What to do with Lm5,000

By Marika Azzopardi

Paying of loans is a top priority in many people’s minds. This is based on a poll organised by The Malta Financial and Business Times which asked a simple question to a selection of white-collar workers. ‘If you were given Lm 5,000 today, what would you do with them?’

Respondents were given five answers to choose from; placing the money in a fixed bank account, placing it in a savings bank account, invest in bonds, invest in funds or else spend them.

Initially some people thought it was a quiz of sorts. Others gave a broad grin, quickly followed by a cynical grimace. The end result was interesting enough to say the least.

Only a minor proportion of those questioned actually had any intention of investing the money through a planned scheme in order to reap benefits in the long-term. The majority opted to spend their Lm 5,000 by paying off loans with home loans getting more than just a mention. Any money left over from the debt servicing would be used for improving the home itself. Fixed accounts were the next best option, the excuse being that money, which is out of sight, will not be spent.

When queried on how they would spend their money, disposing the cash in the fastest way possible was the preferred option with a long-winded vacation, family and all topping the list for most people.

So whilst investment companies are harping away about wise investments, bonds and shares, it is immediately evident that workers seem more intent on relieving the heavy debt pressure off their backs and enjoy every day in the best possible manner.

Saving for a rainy day seems to be an outdated saying, which does not augur too well for fund managers and life policy agents trying to entice customers to longer-term investment decisions.