ASB Investment Calculator
Compare direct ASB savings vs ASBF financing strategies for investment planning.
Investment Parameters
Results Summary
Direct ASB Savings
ASBF Financing
Strategy Comparison
Detailed Breakdown (40 Years)
Direct ASB Savings
Monthly RM 867 • 5% annual return
| Year | Beginning | Investment | Return | Balance |
|---|
ASBF Financing Strategy
RM 200,000 loan • 4.25% interest
| Year | ASB Balance | Loan Outstanding | ASB Return | Net Equity |
|---|
Calculation Formulas
Direct ASB Savings Formula
Monthly Direct Savings Process:
1. Calculate Monthly Return = Current Balance × (Annual Rate ÷ 12)
2. Add Monthly Payment + Monthly Return to Balance
3. New Balance = Previous Balance + Payment + Return
Example: Balance RM10,000 → Return RM41.67 → Payment RM867 → New Balance RM10,908.67
Key Points:
- Monthly returns calculated on current balance
- Compound interest effect - returns earned on previous returns
- Monthly payment added to balance each month
- Total Investment = Monthly Payment × 12 × Years
- Total Returns = Final Balance - Total Invested
- ROI = (Total Returns ÷ Total Invested) × 100%
ASBF Financing Formula
Annual ASBF Process:
1. Annual ASB Return = ASB Balance × Annual Rate
2. Add Annual Return to ASB Balance
3. For each month: Calculate loan interest and principal payment
4. Reduce loan balance by principal payment (prevent overpayment)
5. Net Equity = ASB Balance - Loan Balance
Note: ASB returns calculated annually, loan payments monthly with overpayment protection
Where:
- Monthly Loan Rate = Annual Loan Rate ÷ 12
- Annual ASB Return = ASB Balance × Annual Rate
- Principal Payment = Monthly Payment - Loan Interest (capped at remaining balance)
- Net Profit = Final Net Equity - Total Investment
- ROI = (Net Profit ÷ Total Investment) × 100%
Key Assumptions
- Direct Savings: Monthly compound interest on current balance
- ASBF Strategy: Annual ASB returns, monthly loan payments with overpayment protection
- Fixed Rates: ASB return and loan interest rates remain constant throughout 40 years
- Regular Payments: Monthly payments are made consistently (RM867 default)
- No Early Withdrawals: ASB balances are not withdrawn during the period
- Loan Structure: ASBF uses reducing balance loan (interest first, then principal)
- Equal Investment: Both strategies use same total monthly payment amount
- Calculation Period: 40-year investment horizon for comparison
Research Note
This calculator was created to help analyze and compare ASB investment approaches. It provides a way to visualize the long-term impact of different investment strategies for personal reference and learning.