You have not heard about me including my job when I said
life has been great to me? Well, job is just a job, there is seriously nothing
fancy or funky that I want to talk about since it will bore you and sending you
straight into the middle of the oblivion. Since I am, or we all are, going to
be running through the same situation throughout our life. Get good grades in
school, get part time job that pays S$10 an hour during school days, get first
job, complain about it, move on to another job, complain about new job, look
for greener pasture, unfold hidden rancid manure, move on to another planet which
we dream about the bigger and brighter moon, end up discovering it is actually
just another moon being lit by the same scorching sun.
Get retrenched, go into self employed business, earn hand to
mouth, sick of this life, work as a janitor in a local hospital, complain about
job, go into another hospital, complain about new job, look for greener
pasture, realizing you ended up cleaning and clearing tables at a hawker
centre. Finally turn into dust after 36,500 days that is, if you live to a ripe
old age of 100 years old.
So what did they do that we have not done? They; who are
‘They’? They are the 1 million dollar Ferrari owners, living in 30 million Sentosa
Cove mansions, enjoying the sumptuous and healthy 100 dollar breakfast at
Picotin and then riding on their pet horses at 10am in the morning. Get a cool
mentholicious shower at the prestigious Singapore Island Country Club, drive to
the Marina Bay Sands and off to get their next collection of 30 thousand dollar
Patek Philippe, which they are not actually owning it but taking good care of
it until they pass it to their next generation.
They, are the same Homo
sapien as we are. All derived from evolution and we were all mere single
cell organisms feeding on microscopic nutritional square meals. Some may have a
better start then the other, some may have reached the end to begin with, and
some may just be like us, and became like them.
Generations of intelligent planting of money trees are
yielding fruits of labor for the next generations and generations to reap on.
Last generation of intelligent planting of money trees help kick start the next
generation to prolong the meaning of life. This generation of intelligent money
trees planting will bring you closer to the meaning of life, it will not be
easy, trust me, it will not be easy, not without a little lady luck smiling at
you.
Successful empire owners had just planted the right trees,
with a little bit of luck shining on the choice made. Those who plant Mango
trees get a first taste of the succulent sweet juice dripping mango. Those who
plant Rain trees get to have shade and shelter to get away from the harsh
elements. Those who plant beautiful Adenanthera
pavonina get to enjoy the eye candy full of brilliant red seeds, also known
as the Saga tree. The Saga seeds are highly ornamental, can be made into
jewellery to melt the heart away. But they have to give be traded to the Rain
Tree owners to have shade and shelter before they can enjoy the eye candy away
from the harsh elements. Saga and Rain needed Mango because they have to eat to
stay alive, and some say, you stay alive to eat. All in all, the empire owners,
who made a choice to plant the Money trees, are accessible to succulent fruit,
tallest and mightiest shelter, last but not least, the biggest and shiniest
string of Saga ornament. Who says money don’t grow on trees, it is a matter of
choice, a little self reflection if you want to have the fruit and eat it? Or
has endless access to everything else which you can trade your money leaves
for.
Building a house from scratch is like planting a Rain tree,
you have shelter over your head, but no access to Mango nor Saga. Likewise,
planting Saga has no meaning if there are no one else except yourself, who
wants a piece of the eye candy.
Who says Money can’t grow on trees? Who say you can’t life
in a cave? Who says you can’t eat tree barks and its roots? Who says you can’t live
without dangling the beautiful Saga necklace? We all can, but most choose not
to. That is a choice, a choice you can make and that is the power of choice,
we, evolved from a single cell organism, can make or break or simply live the
36,500 days like a king or like a wimp.
Get good grades in school, get a good paying job, fight for
higher position to get a higher paying role. The higher you are paid, the more
risk you will take. The risk of screwing up, the risk of being taken over, some
say, it takes 1 mistake for you to get really infamous, it just take 1 single
wrong move and you will tumble from the seventh heavens, straight to the
bottomless pit of eternal raging fire which you shall burn forever.
Be a professional, be a doctor, a lawyer, a pilot, a hawker,
a flea market store paddler. Being the best in your trade, no doubt you will
reap the fruits of what you sow. Be a doctor, be a lawyer, grow your world most
succulent sweet tender juicy Mango. Be a hawker, a flea market store paddler,
grow your world shiniest Saga seeds. These are all choices, and the choice you
make, makes you. The risk you take, takes you. The trees you plant, defines you.
We all made choices in our life, right or wrong, we all
deserve it and learn to deal with it. Money Tree made a right choice, Mango
Tree made a tedious choice, Rain Tree made a tough choice, Saga Tree made a
beautiful choice. There is no wrong choice, there is only mental wrestling you
have to deal with. Ever heard someone said why plant a Money Tree where Rain
Tree can brave you from the harsh elements? Moments later your Money Tree
blooms and you hear the same someone said, you are lucky to have planted a
Money Tree, now you can buy all the Rain Trees you want. A matter of fact any
kind of success stories are amplified like the colorful fireworks in the sky
and any failures are quietly carried away by the wind like a speck of dust
where no one has ever known its existence.
Life Singapore is harsh, no doubt about that. High cost of
living, high cost of shelter, high cost of private transportion, highly
competitive jobs, high life you enjoy, high credit limits, breaking credit card
limits, highly in debt, when you can’t
even get high.
You can always live in a 3 room flat, drive a more than 10
year old Toyota, beautiful wife, great kids, stable job, enjoy occasional
feasts, and be as happy as a king. You can also live in a mansion in Sentosa
Cove, drive a brand new Ferrari, beautiful wife, great kids, no job, enjoy
daily feasts, and be as happy as a king. We can all be happy, contented, then
not contented, make another choice, be happier, be busier, be happy, contented,
then not contented, make another choice, end up as dust in 36,500 days. And it
goes round and round again for generations and generations.
A typical Singapore starts off their first 1,460 days
learning to crawl, to walk, to talk. The next 5,840 days in kindergarten all
the way to university, or next 6,570 days if you are have morning wood because
you cannot forget the time spent in mandatory national service. Looking on the
bright side, everyone has a fair share of an average remaining maximum 28,000
days. That is quite a long time, some would say.
By the time you are in your early 20s, the prime of the
prime era, you can no longer ride in your mother kangaroo’s sack, or you can be
a slimy gooey parasite until fine one day your mother decides to call in the
pest busters to eradicate you in the worst way you can ever imagine. These are
facts, and facts we see every day. If you don’t see it, you are the lucky one,
I can tell you it is true and nothing but the truth.
As of year 2012, the Ministry of Manpower current statutory
age of retirement is 62, up to 65 in the first instance and, later, up to 67,
and who knows in near future, the retirement age might be 70 or beyond. It is
great for the government to take care of us, taken from the MOM website, during
the Retirement Age (Amendment) Bill 2011 2nd Reading Speech by Mr Gan Kim Yong,
Minister for Manpower, 11 January 2011, 3.00pm, Parliament. Mr Gan said, ‘the
average life expectancy of Singapore residents has risen steadily, from 68
years in 1970 to 76 years when the Retirement Age Act was enacted in 1993. The
average life expectancy has increased further to 81 years in 2009. It is a good
thing that we are living longer. As we live longer, many Singaporeans want to
work for longer. Working not only enhances their financial security in old age,
but also provides an added sense of purpose in life. They can remain active
while making valuable contributions to their organizations.’
It is indeed what I want, to work longer, not. Maybe you,
but not I. I cherish my remaining days.
The economy in Singapore plants the Money Trees, loan us the
money leaves to buy our Mango, our Rain Tree Shelter, our Saga seeds. We spend
our 28,000 days paying back the money leaves with compounded interests and
leave us dry during the end of our life. If retirement is at 67 and life
expectancy is 81, we have to continue earning our keep during the remaining
5,745 days fending our own life before turning into dust. I guess it takes
almost the same number of days to unmake us as it takes to make us.
No doubt about security and stability here, the convenience
of life and certainty of our next generation holds high. We have foreign talents
swarming into our little red dot, earning their buckets of gold and return to
their country start living like a king in their not so old age. It is actually
not a bad idea looking at the bright side. We have foreign manpower building
the nation for us, and we don’t have to take care of them when they are in
their old age. How convenient is that? We should see the benefit of the influx
for foreign talent, no doubt there are serious competitions, but won’t we have
competitions if there are no foreign talents? I doubt so.
Crossing the causeway, we Singaporeans love to shop and eat
and abuse the currency. Look at the bigger picture, look further from your
comfort zone, see and think out of the box. We not only abuse the currency to
shop and eat, we can abuse the currency investing in cheaper domestic and
industrial properties. This is what they did and we did not. Yes, they are
doing it, but they aren’t going to let you into their darkest secret. Well,
that is just the first dark secret we are drilling into.
Taken from Forbes:
Year 2012 Singapore wealthy qualifiers need a minimum of
$210 million to qualify for Forbes’ list:
The top 10 richest in Singapore are:
1) Ng Family (Far East Organization and Sino Group)
Net worth: $8.9 billion
Primary Source: Real estate
2) Khoo Family (Goodwood Group)
Net worth: $6.7 billion
Primary Source: Banking
3) Wee Cho Yaw (UOB)
Net worth: $4.2 billion
Primary Source: Banking
4) Richard Chandler (Richard Chandler Corporation)
Net worth: $4 billion
Primary Source: Investments
5) Kwee Brothers (Pontiac Land)
Net worth: $3.9 billion
Primary Source: Real estate
6) Kuok Khoon Hong (Wilmar International)
Net worth: $3.5 billion
Primary Source: Palm Oil
7) Ong Beng Seng & Christina Ong (Diversified)
Net worth: $1.9 billion
Source: Diversified
8) Peter Lim (Remisier King)
Net worth: $1.8 billion
Primary Source: Investments
9) Kwek Leng Beng (Hong Leong Group, City Development
Limited)
Net worth: $1.7 billion
Source: Diversified
10) Lee Seng Wee (OCBC)
Net worth: $1.4 billion
Primary Source: Banking
Hard work, great foresight, dedication to giving finest
care of their Money Tree, these fine billionaires and next generations and
generations benefiting from once a seedling and budding into young plant and
growing into a Money Tree with solid foundations. They chose the right tree, so
why should we not.
Going into a choice is never easy, who said it is? Having
an 8 to 5 job is easy, planting the Mango Tree is easy, picking Saga seeds is
easy, it takes you somewhere, and that is your choice. If these top 10
Singapore billionaires did what our parents or grandparents did, they will not
have been where they are today. Indeed this can be sheer luck, but luck only
goes to people who choose to receive them, who choose to take intelligent risk,
which enjoys delay gratifications, who eats the succulent Mango later and
without having to plant them.
My heart is crying when I remembered how I came to what I
am today. I am nowhere near them, one day I will, or the day never come, I know
it may come if I choose, I know it will not if I do not. Everyone was young
once, you want to shine at your earliest prime, I, once was a victim of being a
short lived bright shining star, having later to know that a star is just a collapsing
cloud of elements under its own gravity. There are those who say the rich get
richer, and peasants remain peasants. What we should do first, is just exactly
what those who say rich get richer, that is to get rich.
What is the definition of rich? Do you suggest you are rich
when you first started work in your early or mid 20s earning an average of
$2,500.00 a month which is an average of $125 a day if you work 20 days a
month. Do you suggest you are rich when you earn $10,000.00 a month which is an
average of $500 a day?
Let’s do some simple math:
Age 21 – 30: $50,000 per annum = $500,000
Age 31 – 50: $100,000 per annum = $2,000,000
Age 51 – 60: $200,000 per annum = $2,000,000
Total of 4.5 million dollars earned.
(Disclaimer, if you get married, income can be doubled as
well as other expenses)
This income bracket is in the higher than average earning
of a university graduate in Singapore, we just take more shall we? Isn’t the
more the merrier?
Say over these years, we spend 25% for expenses, 25% for non-appreciable
luxuries and holidays, 25% for those money you do not know where it goes (don’t
tell me you are not guilty of those money spend on ‘you do not know where it
goes), so then throughout the age of 21 – 60, you have 1.125 million dollars
spare. Isn’t that great? You can find yourself being an owner of Bishan Street
Executive Mansionette, or a proud owner of a Condominium at a highly
inaccessible location.
That isn’t bad actually, as you turn into dust after
36,500 days, you can pass the Rain Tree to your only child, or share it amongst
many. So tell me, how did you live the 28,000 days after you graduated? Are you
rich at the end of it? Or there is something better you could have done
earlier, if someone told you how to?
Coming back on being rich to be richer, we need to forget
about how some lucky ones get a better head start. Quit the whining and use
that extra brain power on something more worthwhile. If being rich can make you
richer, why not first start with getting rich? Let’s now talk about how to become
rich, action speaks louder than words.
From the simple math calculation, we see typical
individuals or couples sinking themselves into this lifestyle. I know it is
easy to say cutting down expenses by half, cutting down luxuries by half, or
even cutting half of ‘you do not know where it goes’ money, you can have a vast
amount of money accumulated. That is, if, you cut, and you will see it when you
are almost time to turn into dust. It helps at the beginning, and that is where
it all begins. We are going to turn these ‘cuts’ into Money Trees.
Let’s start from the fact that we are all in debt.
Education loans, Car loans, Insurance, Home loans if you are married. Or even,
Credit Loans, Credit Cards debts, personnel loans from friends and family
members. Tell yourself now, you are having a great head start if you are clear
of education loans, no car loans, and you don’t buy insurance, not married,
credit card or other debts. The basic human instinct, especially in the highly
competitive Singapore, you will eventually, one way or the other, end up in
this devilish and blood sucking situation. So first, let us find out how to get
out of this situation, if you are the lucky ones whom are having this great
start, read on to learn how not to get into this bottomless pit.
Many do not have my luxury of head start, I did not go to
university, but I do have a diploma loan, which is way lesser than a university
loan. That also means I command lower salary, earning a mere $1,800.00 a month
which is about $25,000.00 per annum including bonuses.
INCOME +$
1,800.00
Transport -$
400.00
Basic Food -$
400.00
Education -$
200.00
Phone Bill -$
50.00
Internet -$
50.00
Entertainment -$ 300.00
Lodging FREE
(Kangaroo in the pouch)
FINAL $
400.00 savings per month
So for the whole of first year, I managed to save
$4,800.00.
I was pretty green during my first job, I took for
granted being late for work, not sucking up with boss’s wife whom was my
manager. Did perform well though, I manage to increase my department’s earning
by 400% comparing to the year before and the two years before. But eventually,
due to disciplinary and non sucking attitude, I was fired and given one day
notice (actually half day) to get out of the office with immediate effect. I
moved on to my new job in second year, with a savings of $4,800.00.
New job, greener pasture, brighter moon, I was delighted
and utmost grateful to my Ms Boss whom sees my positive attitude, passion for
growing the company. I was paid $2,100.00 a month, approximately $30,000.00 per
annum including bonuses.
INCOME +$2,100.00
Transport -$
400.00
Basic Food -$
400.00
Education -$
200.00
Phone Bill -$
50.00
Internet -$
50.00
Entertainment -$ 300.00
Lodging FREE
(Kangaroo in the pouch)
FINAL $
700.00 savings per month
I am really on cloud nine when I was working with my new
Ms Boss, great opportunities, chance to learn skills which the previous company
did not offer. Moreover, I was delighted with my average savings of $700.00 a
month, which I decided to buy me a brand new car, a very wrong move, a move
which I greatly regret within a time span of 1 year. What I should have done
was to buy a 3 – 4 year old car right from the start, Singaporeans take so good
care of their car you can find most are as good as new. I had from then on learnt
a $17,000.00 mistake and have always got a used car since. I took a 10 year
full loan which later cost me dearly when I was penalized by the famous bank
clause rule 78. Do read and calculate with caution what rule 78 is, you will
regret later if you did not at first.
I was given a raise after 3 months probation, bringing my
monthly salary up to $2,300.00 and now I have a car, my company gave me a
transport allowance of $400.00 a month. With that, I need to work out my budget
for installment, petrol, ERP, parking, insurance, road tax, fines (Yes please
don’t forget this), extra spending due to mobility and act of showing off to
friends.
My new balance sheet looks like this:
INCOME +$2,300.00
TRANSPORT ALLOWANCE +$
400.00
Car Installment -$
500.00
Petrol -$
300.00
ERP/Parking -$
100.00
Insurance/Road Tax/Fines -$
200.00 (1.0 Liter car)
Basic Food -$ 400.00
Education -$ 200.00
Phone Bill -$ 50.00
Internet -$ 50.00
Entertainment -$ 600.00
(heavily increased)
Lodging FREE (Kangaroo
in the pouch)
FINAL $ 300.00 savings
per month
At the end of the second year into my working life, I
have a savings of $9,800.00. I was indeed having a great time, doing my due
diligence in my job, having to own my machine of teleportation for the very first
time. Then comes the time where we complain about new job, unfold hidden rancid
manure, and decides to move on to another planet which we dream about the
bigger and brighter moon. I am greatly thankful to my Ms Boss during the mere
1½ year in the company, we parted with mutual understanding it was a indeed a
hard decision to move on from a company which you feels like working as a team,
as a family.
So far, during this two and a half year, I managed to up
my earnings, as well as I up my spending. This is what typical Singapore life
or I should say an average diploma holder’s life. University graduates may have
a better start for the initial income but likewise there will be a higher
education loan to bear.
Before the beginning of my new job, I went on an 8 days
holiday in Taiwan, it was definitely relaxing and recharging experience. The
painful part was I spent more than my $9,800.00 savings, which part of it was
the $4,000.00 ornamental Fengshui display which I was so enticed to buy in a
moment of folly. The moment when you have your credit card with you, the moment
when you are mentally hypnotize by professional master of their realms, you
willingly whip out that credit card and sign off as if you don’t need to pay
for at the end of the month.
Now, I am back to square one with zero savings. Having to
think about it now makes me realize what an idiotic pea brain maggot I was.
What I did wrong, so far:
Brand New Car
Doubled
Entertainment Fees
(if not for the
car, I would not have increased this, well, I did enjoy it during the moment,
so I’m accepting what I’m enjoying, but beware the paying for it hurts like fully
sticking in a 10cm needle under your nail 1mm by 1mm)
Reduced my Monthly
Savings
Used up my Overall
Savings
What I would have done if I can turn back time:
Buy not even a
Used Car
If you have to buy a car, new or used, both has its pro
and cons. The basic rule of time is to not loan more than 80% of the initial
price, not taking more than 7 years loan.
$50,000 loan with 2.68% interest over 10 years
Interest incurred = $ 13,400
The interest amount is a whopping 27.0%, thus anyone will
be crazy to be making such decision.
If I had bought a used car (taking 3 year old similar 1.0
liter car):
Estimated depreciation and market rate: $38,000 loan with
2.68% interest over 7 years
Interest incurred = $ 7,128.80
Actual interest percentage incurred = 18.8%
Rule 78 penalty at 20% of interest if you sell the car =
$7128.80 x 20% = $1,425.76
If I had bought the same used car with down payment of my
$9,800.00 savings:
($38,000 - $9,800) loan with 2.68% interest over 7 years
Interest incurred = $5,290.32
Actual interest percentage incurred = 18.8%
Rule 78 penalty at 20% of interest if you sell the car =
$5,290.32 x 20% = $1,058.06
Not only you reduce your monthly installment payment, you
also significantly reduce the interest incurred. On top of that, the benefit of
down payment reduces further any form of penalty related to early sale or
upgrade of your car.
I actually couldn’t afford the car and it has increased
my entertainment fees and reduced my monthly savings. That is the part where
delay gratification by a year or two, having saved up the initial 20% down
payment can turn the table around. Impulsive buying during holidays was also
not to be forgiven, it may feel great during the moment, but trust me, walk
away, if you didn’t have it in the first place, you probably don’t need it
anytime soon or ever.
On the hindsight, if I had put the savings and further
savings in stock or small business, worst thing I will lost everything which is
the same as spending it away. If things turn out well, a little profit doesn’t
hurt. It was in the year where 9/11 happens and followed by SARS outbreak where
I actually have that savings, shares like Citibank dipped from over $300.00 per
share to below $17.00. The opportunity was there but I did not have the capital
to invest, thus if I had, I could have made:
$9,800.00 / $17.00 = 576 shares
As of October 2012 now, Citibank is price is $33.00 per
share.
I could have retained my $9,800.00 savings, and earn
$9,216.00 before fees deduction.
This is a classic case of not having ready money when
opportunity knocks at your door. Even if you have no business plans right now,
you never know when opportunity knocks and you can definitely turn that savings
you have into money making vehicle.
The reset and missing opportunity was a big blow to me, I
was never near planting a Money Tree, nor was I planting any kind of tree. I am
simply buying Mangos and Saga Seeds which this cycle eventually goes round and
round and round.
Spending of funds in consumables rather investments are
what economists call, consumer debt. These are consumables are either are
consumed or has no appreciating value. Other types of consumer debt like credit
card debts, payday loans, typically of higher interests, or even lower interest
long term loans like house mortgages are typical living standards of
Singaporeans today especially with ever rising property prices. You may be in
need of a car for your outdoor nature job, or a house because you are tying the
knot, this is the tipping point where you stay in the consumer cycle, and never
be rich, to get richer. You can have an older car at a start, a smaller house
at the beginning, by not fully loading your income versus spending; you stand a
chance when opportunity knocks at the door. Understand this, isn’t hard, but
many choose to follow the consumer cycle and spending the rest of the 28,000
days of their life working on wealthy people’s Money Tree while being paid
Money Leaves and in turn trading them for Mango, Rain Tree shelter, Saga seeds.
