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Income Leverage Strategy toward 2021 and Beyond

The Chinese Method of Income Leverage.

Income leverage is a must task for every households whether in recession or not. Those who practice leverage during normal or good market sentiment will do better when in time of recession.

The chinese tradition is to divide an income into three portion :

  • Saving 1/3 into banks
  • Petty cash 1/3
  • To earn more money or investment for the last 1/3.

This what the chinese mentality is like.

They must see one for one as income for a day and it is  alright not to have an income for the day but not losing an investment.

In the old days rural folks normally said “ when there is a smoke there must be a chinese there”.

In todays world, majority of us including the chinese are not so much as the fore fathers did. Life have changed and adapted  to digital, forex trading, bitcoin and stock market. Some earn so much more than the others YOY ( year on year) but how do income class being stated. 

More blog post HERE.

Household Income Classification.

Honestly I only come to know these income classification during the end of Malaysia’s Barisan National government. They used these as a yardstick to distribute financial assistant the BRIM ( Bantuan Rakyat 1 Malaysia). This assistant changed names under various government for example BSH ( Bantuan Sara Hidup) , BPN ( Bantuan Prihatin Nasional) and later to another bantuan.

I only can relate Income Class for Malaysian. I guess that the income here are the take away gross income before tax filing for the annual income statement.

Economic growth indicator fall into three categories income groups: Top 20% (T20), Middle 40% (M40), and Bottom 40% (B40). This is revised for very 5 years.

The concept is briefly describe as

  • HOUSEHOLD INCOME:Overall income that is earned by household members, whether in cash or kind, and can be referred to as gross income. In 2019, the average monthly income in Malaysia is RM7,901
  • MEDIAN HOUSEHOLD INCOME:is the “middle” income number within a range of household incomes, arranged from low to high. For example, in Taman Bintang, there are five household incomes of RM5,000, RM10,000, RM15,000, RM20,000, and RM25,000; the median household income will be RM15,000. The median is used because it represents a more accurate representation of the area than a mean number (the average).
  • MEAN HOUSEHOLD INCOME:is the “average” income number where all household incomes are added up and divided by the number of households.

So how do we get classified into the B40, M40, and T20 income groups?


Median Monthly Income By Household Group

Household Group

Median Income 2019 (RM)

Median Income 2016 (RM)










Monthly Income Range By Household Group

Household Group

Income Range 2019 (RM)

Income Range 2016 (RM)





4800 – 10900





What Income is Middle Class.

If you look at the diagram above the middle class falls into the M40 group. This bar may be changed next year because of the economic affected by the pandemic.

Here come the leverage.

Leverage don’t comes easy during this pandemic because so many people were being retrenched and companies have reduced the workforce and that affected the production as well. This affected almost all sectors across the board. However, the stock market don’t seem to be affected. I mean the stock market is not going down. But instead it go up.

This suggest that many people put their money in the stock market to leverage their loss of income from employment.

Stock marketing seem to be the battle ground among those who are out of jobs and the fund managers.

Stock market at today have break the 52 weeks and going to be all time high. This is happening to almost all stock market in the world. I don’t encourage my reader to pump your last money in the market. The bubbles will burst in no time. DO prudent investments like slow and consistent income to leverage your loss of income by doing some affiliate marketing

More storied relate to article here