Having RM100,000 to your name by the age of 30 can seem overwhelming to many. Yet is it possible.

If you are not born rich and earn RM5,000 or less a month today, here are five thought-provoking questions that will benefit you in the long run and help you achieve your goal of amassing RM100,000 by age 30.

Q1: Can you save your way to RM100,000?

If you make RM5,000 a month, are you able to save 30%-50% of your monthly income for the next three to five years to amass RM100,000 by 30?’

If you find this approach ‘tough’, it is. Saving your way to RM100,000 can be excruciating and rather demotivating to most.

Answer: ‘You need a better plan than just saving money to raise RM100,000 by 30.’

Q2: Why can’t middle-income folk be rich?

Take a pen and paper. Draw a straight line down the centre. On the left, list your monthly income. On the right, list your monthly expenditure.

What does it look like?

Answer: ‘You have multiple expenses but rely on one source of income to support them.’

Q3: Should you cut your expenses?

You can immediately boost your savings every month by reducing a handful of expenditures that are not urgent. This includes holiday trips, latest smartphones, gym packages, clubbing, fine dining.

But guess what? You may boost your savings by a few extra ringgit a month.

Does it make you rich? Not really. Cutting down from 10 expenses to seven is not enough to make you rich. Instead, it is a quick way to make you feel miserable and ditch the whole idea of building your RM100,000 in savings.

Why? This is because your mammoth efforts in cutting expenses will not provide you a big enough reward to continue the effort.

Answer: You still have only one source of income to pay for numerous expenses.

Q4: Should you focus on ‘income’, not expenses?

In contrast, you should spend money … wisely. Take a look at your list. Which of those expenses makes you richer?

If you earn RM5,000 or below, you most likely don’t have knowledge, ideas, skills, insights, technical know-how, network, influence and such that can be traded for money to boost your income.

Here’s what you should do.

For instance, if you have RM30,000 in cash and intend to raise that cash to as much as RM100,000, instead of saving RM500 or RM1,000 a month, it will be faster and more efficient to identify the skills you need to learn which can be traded for higher income.

So, pay to acquire these skills and master them.

What are some of these skills? It depends on your field of work and industry.

There will always be the top 10% or 20% who make more money with less effort as compared to the rest in the industry. You may want to find out what they do and learn from them.

If you’re into business, then, it’s essential to take time to study from the best marketers about sales and marketing.

Instead of cutting business expenses (which is not going to take your business to the next level), you should spend money to learn about marketing and further raise your budget in marketing.

Why? This is because marketing brings sales and sales brings income. Less marketing may lead to less sales and thus, bringing in lesser income.

Answer: Increasing income is a faster way to raise RM100,000 than saving money. So, what do you need to learn to increase your income today?

Q5: What is your catalyst to RM100,000 and beyond?

Over time – probably six to 12 months after learning a tradable skill, you should experience some form of increase in active income.

That’s great. But it is not time to ‘increase your expenses’ yet.

Why? This is because you still have only one source of income despite having a raise in the quantum of income.

The good news is: You are ready to convert this cash into investments that will pay you regular streams of passive income, which is income earned from being an owner of assets, not physical labour.

They would make you more financially stable, enabling you to reach the RM100,000 target in savings faster.

Answer: Generate more than one source of income to pay for more expenses on a monthly basis.

This article first appeared in kclau.com

Ian Tai is a financial content machine, dividend investor and author of over 450 articles on finance featured in KCLau.com in Malaysia, and ‘Fifth Person’, ‘Value Invest Asia’, and ‘Small Cap Asia’ in Singapore. He is a regular host and presenter of a weekly financial webinar with KCLau.com.