Some info about Skim Simpanan Pendidikan Nasional (SSPN) is located here.
What do I think? Ummm, hard to say really. I think that it’s a product that could help a lot of Malaysians but on the other hand, I’m pretty skeptical. One major factor that is currently steering me away from SSPN is the dividend rate. The expected provision of 4% per annum just doesn’t cut it for me. You barely beat inflation with that. In fact, with the sort of inflation rates we’re seeing right now, matched with that sort of returns, the value of your money will erode. Of course you don’t see your money actually decreasing in amount but if the inflation is 6% and your return is 3%, then yes, the value will decline.
But remember, everybody’s different. My liking of risks might not be the next person’s cup of tea. In fact, SSPN could be suitable for a lot of people out there.
To me, I think my money’s better invested in other vehicles. I’m assuming, the purpose of SSPN for everyone is to save up for their kids. Which means, we’ve got the advantage of a really long time horizon of say 17 years? It might be worth my time to keep my money in a riskier vehicle and earn higher returns as a result.
With SSPN, I believe that you are in the process of SAVING your money, and not INVESTING your money. Well, that’s why they call it “Skim SIMPANAN Pendidikan Nasional” rather than “Skim PELABURAN Pendidikan Nasional”.
So, to be honest, I’m not entirely convinced with the idea of putting my kid’s education fund in SSPN. Personally, I’d be looking at SSPN as a backup instrument for my kid’s education.
Folks with an opposing view, share your opinions. Let’s have a full-blown discussion.
Disclaimer: This article is not a specific nor general advice on managing or investing your money. This article does not constitute a recommendation nor does it take into account your investment objectives, financial situation nor particular needs.