Mekar News

Splurge vs Invest: Why You Should Not Spend All Your Money On a Lebaran Shopping Spree

The end of Ramadan is approaching. After a month of daily fasting, this weekend we will finally celebrate the Eid al-Fitr holiday. Some of you might have started preparing for the big day. As with any other holiday, the Eid al-Fitr, also called Lebaran, is usually celebrated quite lavishly. Come weekend, many people in Indonesia, Muslims and non-Muslims alike, will have food galore, family and friends clad in their best outfit will visit each other and little children will leap in joy as they receive new toys or money from their older relatives.

In the lead-up to Lebaran, fashion stores and supermarket chains usually run special offers to convince shoppers to keep spending their money during this final week and even well after Eid. Online marketplaces are using the same strategy, and they have started cashing in on the Ramadan rush; sales of clothes and gadgets have soared since the beginning of Ramadan and are expected to keep rising over the coming weeks.

This week, millions of Indonesians will also start the annual exodus, or Mudik, bracing hours of traffic gridlock as they return to their hometown to celebrate the Islamic holiday with their loved ones. Some are bringing gifts or money as a token of their love for their family. Lebaran is indeed a major holiday for Indonesians, and many spend quite a hefty amount of money celebrating it.

Imagine if we can use this buying power that we have and transfer that into wealth.

According to a recent estimate by the Indonesian Retailers Association (Aprindo), retail sales are likely to reach Rp 224 trillion in 2017, a 12 percent increase from the figure estimated last year.

The relentless pressure to consume means we are always focused on income; we think about getting a side job or getting a salary raise, and we rarely think about building our wealth.

This Lebaran, instead of spending money frivolously on material goods, why not set aside some of your cash and invest? Many people think one needs to have tens or hundreds of millions rupiah before they can start an investment, but there are ways to invest even just a small amount of money.

The average person can spend millions of rupiah on Lebaran shopping, sometimes splurging on a new outfit or smartphone. The same amount can be used to buy a share of stocks or mutual funds, for example, or many other kinds of investment alternatives.

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Say you’re thinking about buying a new phone or tablet to treat yourself or a spouse for Lebaran. A Samsung Galaxy Note 4 Smartphone will cost you Rp 5,250,000 while an Apple iPad Mini 4 32GB Tablet is priced at around Rp 5,900,000. You can use your money instead to finance a small business loan through Mekar, a peer-to-peer lending platform that lets individuals and institutions loan money to Indonesian small businesses.

Even just forgoing a new outfit will save you enough money to fund one of these loans. Click here to find small amount loans on Mekar. Your investment on the Mekar P2P lending platform will deliver solid returns of an average of 10% per year. That’s additional income that will help you pay for your Lebaran shopping next year, or invest that money again, earn even more and start building your wealth.