If calculus or algebra were required to be a great investor, I'd have to go back to delivering newspapers. - Warren Buffet.
According to Warren, the maths skills you need to be a great investor are addition, subtraction, multiplication, division, and the ability to rapidly calculate percentages & probability. Anything more, as the French would say, is a waste. Anything less and you can't play the game.
What is one of the world greatest investor trying to tell us ?
You don't need to study rocket science to become an investor who makes money.
There are too many investors out there calling themselves "investors" but not making any money in the market.
So the question is, if you don't need to be a genius to become an investor who makes money, how come people are not making money in the market?
I mean an investor who makes money both in the bull market as well as the bear market.
Even a fool will have no problems making money in the bull market you see.
Although you do not need to be a genius to become an investor who makes money in the market, but you also can't be a fool and expecting to become rich just by anyhow investing.
You need to get an education in the area of investing. A proper education to see some proper returns on your investment.
When you do not understand investment, you will feel insecure when you are asked to invest.
And, you should feel insecure!
I've talked to people about investment before, "hey! since you got extra fund, why not invest in XYZ?"
"I need to save money leh, next time need to buy house"
They talked as if once they invest the money, means like they are throwing away the money, sure lose one. Met them before ?
That is also one of the reason why people aggressively save money or buying savings plan.
Because they don't understand how investing works, as well as how to protect their capital, that's why they prefer buying savings plan and I think they should buy into savings plan instead of investing.
Until they decided to get educated.
Because savings plan in a way, most of it protects your capital as well as giving you roughly 3% returns every year, which is higher than most of the bank in singapore.
But have you ever wondered where do those financial institutes get the money to give you your 3% returns every year?
Think about it...
Merry Christmas
&
Happy New Year!!!
Tuesday, December 28, 2010
Thursday, December 9, 2010
Branding yourself !
When I mentioned about branding yourself, I don't mean LV or Gucci from head to toe.
Although that might be part of how you want to portray yourself to the rest of the world.
And I always believed in dressing well. Because you doesn't get a second chance to make a first impression.
When people first met you, they doesn't know your personality you see.
What makes people want to start communicating with you will be how they see you.
Have you met people whom at the first glance, you wouldn't want to be their friends?
Although I'm a really nice guy, sometimes when I met somebody for the first time, I don't really feel like talking much to them. I think some of you might know what I'm talking about.
But when I talked about branding yourself, I mean creating such values or being so specialized in something that people relates that area to you.
You can brand yourself no matter who you are or what you are doing for a living.
You can create a positive brand or a negative brand, knowingly or unknowingly.
If today, you are an employee of a company. You must find a certain scope of your work which you can excel so well that nobody else does it better than you.
So that when that scope of work needs to be done, people will say, " hey! get her, she is best at that!"
If you're a self employed, be it financial consultant or real estate agent, you need to find an aspect and be so good at it that when people seek that area of service, they think of you.
Example, you might be a financial consultant and you are so well versed in the area of legacy planning. So when people wants to leave a legacy for their loved ones or any charitable organisation, they will think of you and would want to engage you for that area of service.
You are tons of other financial consultants out there with the license to sell exactly the same products which you're selling, but what makes people want to engage you ? Branding!
Or you might be a real estate agent that is so well versed in the area of finding new homes for family with elderly. When a family with elder parents want to buy a new home, the first person they think of will be you!
When you're able to brand yourself in that area of expertise, you will be able to command a higher premiums, thus resulting in more income for yourself.
You're still doing what you are doing, nothing has changed.
In the same company, same position, same boss.
The only thing that has changed is your mindset.
And everyday you think, "How am I able to add more value to what I am doing?"
By asking yourself this question every morning before you start your day, spend 5 - 10mins thinking of new idea to add more value into your work.
Eventually, everything else changes, becuase you choose to change your attitude.
But it all starts with the first step. Changing your mentality.
But, how do we translate our efforts directly into compensations ?
one golden rule: ASK!
As an employee, most of your boss would wants to keep your salary there, where it is right now.
How many employer actually comes to you, "hey john! great performance man! I'm going to give you $1000 increment every month!"
You need to "ask" tactfully.
You might be asking directly for a pay raise, or you might be saying that a competitor firm is offering you "this" much.
But you need to create enough value for the company so that your boss will want to give you that increment!
For Self employed, also we asked!
most of the time, directly, this is my fee.
want or don't want.
But before that we need to show our clients the value of engaging us before asking the "want or don't want" question.
And being able to "brand" yourself and stand out from the rest, the chances are, you are going to get more income for yourself as compared to your peers, and thus, reaching your goals at a faster speed!
Race towards your goal!
Although that might be part of how you want to portray yourself to the rest of the world.
And I always believed in dressing well. Because you doesn't get a second chance to make a first impression.
When people first met you, they doesn't know your personality you see.
What makes people want to start communicating with you will be how they see you.
Have you met people whom at the first glance, you wouldn't want to be their friends?
Although I'm a really nice guy, sometimes when I met somebody for the first time, I don't really feel like talking much to them. I think some of you might know what I'm talking about.
But when I talked about branding yourself, I mean creating such values or being so specialized in something that people relates that area to you.
You can brand yourself no matter who you are or what you are doing for a living.
You can create a positive brand or a negative brand, knowingly or unknowingly.
If today, you are an employee of a company. You must find a certain scope of your work which you can excel so well that nobody else does it better than you.
So that when that scope of work needs to be done, people will say, " hey! get her, she is best at that!"
If you're a self employed, be it financial consultant or real estate agent, you need to find an aspect and be so good at it that when people seek that area of service, they think of you.
Example, you might be a financial consultant and you are so well versed in the area of legacy planning. So when people wants to leave a legacy for their loved ones or any charitable organisation, they will think of you and would want to engage you for that area of service.
You are tons of other financial consultants out there with the license to sell exactly the same products which you're selling, but what makes people want to engage you ? Branding!
Or you might be a real estate agent that is so well versed in the area of finding new homes for family with elderly. When a family with elder parents want to buy a new home, the first person they think of will be you!
When you're able to brand yourself in that area of expertise, you will be able to command a higher premiums, thus resulting in more income for yourself.
You're still doing what you are doing, nothing has changed.
In the same company, same position, same boss.
The only thing that has changed is your mindset.
And everyday you think, "How am I able to add more value to what I am doing?"
By asking yourself this question every morning before you start your day, spend 5 - 10mins thinking of new idea to add more value into your work.
Eventually, everything else changes, becuase you choose to change your attitude.
But it all starts with the first step. Changing your mentality.
But, how do we translate our efforts directly into compensations ?
one golden rule: ASK!
As an employee, most of your boss would wants to keep your salary there, where it is right now.
How many employer actually comes to you, "hey john! great performance man! I'm going to give you $1000 increment every month!"
You need to "ask" tactfully.
You might be asking directly for a pay raise, or you might be saying that a competitor firm is offering you "this" much.
But you need to create enough value for the company so that your boss will want to give you that increment!
For Self employed, also we asked!
most of the time, directly, this is my fee.
want or don't want.
But before that we need to show our clients the value of engaging us before asking the "want or don't want" question.
And being able to "brand" yourself and stand out from the rest, the chances are, you are going to get more income for yourself as compared to your peers, and thus, reaching your goals at a faster speed!
Race towards your goal!
Monday, November 22, 2010
The 2 Categories of job for your money
In our last session, we talked about finding out what are the kind of jobs which you can assign your money to work in to yield profits for you.
There are tons and tons of different jobs for you to assign to "them"
But generally speaking, among all the jobs that money can take on, it is categorized into 2 types,
1. Capital gain
2. Cash flow
1 + 2 = Capital gain + Cash flow
When you talk about investing, yup investing is a high class word for your money working for you.
When you talk about investing, most people tells you they invest in unit trust(most common kind of investment) follows by individual stocks, or ETFs (it's getting more popular among investors).
These group of people invests for capital gain.
Capital gain investors usually work on a buy low sell high kind of strategy.
When they markets go into a depression, there are 2 groups of capital gain investors.
1. "Lucky I sold mine before the market drop, now I'm going to buy everything at a discount!"
2. "Why didn't I saw it coming!" Their funds are being locked up and they cannot sell, if not their paper loss will translate into a physcial loss.
The second group of people invests for cash flow.
Cash flow investors basically ignores the market.
As long as their investments put money into their pocket on a consistent basis.
So working out using maths, it looks something like this.
John buys an Investment for $10
Every year the investment promise to pay john 1 dollar for the rest of his life.
So it takes 10 years for john to break even.
On the 11th year onwards, John starts making a profit until he expires.
Good market, Bad market, every year john will still pocket a dollar.
In the market, such investments come in a form of dividends of a stock or funds or rental income.
But a real estate is a combination of capital gain investing + cash flow investing.
However, they are people speculating properties like a stock, purely for capital gain, quick bucks.
Nothing wrong with that as long as you are well versed in that area.
Some of the more popular cash flow investments for people who can't afford to yet invest in real estate are investment like REITS( Real Estate Investment Trusts).
However, REITS are slow and "boring" to some people due to it slow movement in the market.
Young people like me are full of energy and wants excitment, so they still prefer individual company stocks.
But what if you can buy individual stocks and get cash flow out of it on a consistent basis, instead of making a profit only when you sell off the shares?
You can use another instruments called options.
Like a call and put options. yep. you get what I mean. But i seriously think that trading options without owning the underlying shares of the options which you are trading is risky. Maybe it is because I'm not well versed in that area, maybe some options expert will tell you that it isn't that risky after all?
But there is one thing I stick to, which is I don't touch instruments which I don't understand.
It is in your best interests that you study the different investing instruments that are available to us.
Cause at the end of the day, you're the one making the profits, enjoying the fruits of your money's labour!
After labouring for yet another year(it's november now), it is seriously time to labour for yourself and your family.
Spend more time minding your own business, but please, still, do a good job at work.
Happy working !
There are tons and tons of different jobs for you to assign to "them"
But generally speaking, among all the jobs that money can take on, it is categorized into 2 types,
1. Capital gain
2. Cash flow
1 + 2 = Capital gain + Cash flow
When you talk about investing, yup investing is a high class word for your money working for you.
When you talk about investing, most people tells you they invest in unit trust(most common kind of investment) follows by individual stocks, or ETFs (it's getting more popular among investors).
These group of people invests for capital gain.
Capital gain investors usually work on a buy low sell high kind of strategy.
When they markets go into a depression, there are 2 groups of capital gain investors.
1. "Lucky I sold mine before the market drop, now I'm going to buy everything at a discount!"
2. "Why didn't I saw it coming!" Their funds are being locked up and they cannot sell, if not their paper loss will translate into a physcial loss.
The second group of people invests for cash flow.
Cash flow investors basically ignores the market.
As long as their investments put money into their pocket on a consistent basis.
So working out using maths, it looks something like this.
John buys an Investment for $10
Every year the investment promise to pay john 1 dollar for the rest of his life.
So it takes 10 years for john to break even.
On the 11th year onwards, John starts making a profit until he expires.
Good market, Bad market, every year john will still pocket a dollar.
In the market, such investments come in a form of dividends of a stock or funds or rental income.
But a real estate is a combination of capital gain investing + cash flow investing.
However, they are people speculating properties like a stock, purely for capital gain, quick bucks.
Nothing wrong with that as long as you are well versed in that area.
Some of the more popular cash flow investments for people who can't afford to yet invest in real estate are investment like REITS( Real Estate Investment Trusts).
However, REITS are slow and "boring" to some people due to it slow movement in the market.
Young people like me are full of energy and wants excitment, so they still prefer individual company stocks.
But what if you can buy individual stocks and get cash flow out of it on a consistent basis, instead of making a profit only when you sell off the shares?
You can use another instruments called options.
Like a call and put options. yep. you get what I mean. But i seriously think that trading options without owning the underlying shares of the options which you are trading is risky. Maybe it is because I'm not well versed in that area, maybe some options expert will tell you that it isn't that risky after all?
But there is one thing I stick to, which is I don't touch instruments which I don't understand.
It is in your best interests that you study the different investing instruments that are available to us.
Cause at the end of the day, you're the one making the profits, enjoying the fruits of your money's labour!
After labouring for yet another year(it's november now), it is seriously time to labour for yourself and your family.
Spend more time minding your own business, but please, still, do a good job at work.
Happy working !
Tuesday, November 9, 2010
You need 2 occupations
You need 2 occupations,
One for you, to keep yourself busy.
One for your money, to keep them busy and productive.
Many people only have 1 occupations, which is to keep themselves busy.
and many who only keep themselves busy, keep on busying till their last breath.
If you work to keep yourself busy, and for every dollars you earn, you give each of them a job to do, to keep them busy and productive, one day, you will be able to enjoy the fruits of their(your money) labours.
And you won't have to keep yourself busy all your life.
You might be a HR executive by day - occupation for yourself
A real estate investor at night - occupation for your money
You might be an accountant by day - occupation for youself
A stock trader at night in the US market - occupation for your money
You get what I mean ? You don't really have to be an entrepeneur or day trader to be very rich.
You can get rich just by doing what you are currently doing.
But for you who are that ambitious, please chase after your dreams!
In our grand father's day, most of them are only taught to work and save money.
But today, we have so many financial instruments around to help you.
We even have alot of financial advisors all around town to help you.
Every MRT station, i mean almost, you will see financial planners standing around anxiously waiting to help you.
Every MRT station, i mean almost, credit card sales person wanting to loan you money to do more.
It is literally right at your doorstep.
But as I've shared before, you need to learn to differentiate sales people from advisors.
Sales people wants to make money from you
Advisor wants to make money for you.
Sales people give you standard sales pitch.
Advisors give you good financial advice.
and no good advice is free.
For all good advice, there's a price to pay.
If you want free advice,
Like all free advice, there's a price to pay as well.
When you pay for good advice, usually you pay upfront, you pay for their services.
When you pay for bad advice, you pay in the future, when it is too late.
Anyway, for those of you that havent found a job for your money, you might want to learn more about the different occupations that money can do!
One for you, to keep yourself busy.
One for your money, to keep them busy and productive.
Many people only have 1 occupations, which is to keep themselves busy.
and many who only keep themselves busy, keep on busying till their last breath.
If you work to keep yourself busy, and for every dollars you earn, you give each of them a job to do, to keep them busy and productive, one day, you will be able to enjoy the fruits of their(your money) labours.
And you won't have to keep yourself busy all your life.
You might be a HR executive by day - occupation for yourself
A real estate investor at night - occupation for your money
You might be an accountant by day - occupation for youself
A stock trader at night in the US market - occupation for your money
You get what I mean ? You don't really have to be an entrepeneur or day trader to be very rich.
You can get rich just by doing what you are currently doing.
But for you who are that ambitious, please chase after your dreams!
In our grand father's day, most of them are only taught to work and save money.
But today, we have so many financial instruments around to help you.
We even have alot of financial advisors all around town to help you.
Every MRT station, i mean almost, you will see financial planners standing around anxiously waiting to help you.
Every MRT station, i mean almost, credit card sales person wanting to loan you money to do more.
It is literally right at your doorstep.
But as I've shared before, you need to learn to differentiate sales people from advisors.
Sales people wants to make money from you
Advisor wants to make money for you.
Sales people give you standard sales pitch.
Advisors give you good financial advice.
and no good advice is free.
For all good advice, there's a price to pay.
If you want free advice,
Like all free advice, there's a price to pay as well.
When you pay for good advice, usually you pay upfront, you pay for their services.
When you pay for bad advice, you pay in the future, when it is too late.
Anyway, for those of you that havent found a job for your money, you might want to learn more about the different occupations that money can do!
Monday, October 25, 2010
Knowledge Vs Money
Knowledge is the new wealth.
Over the weekend, I watch the show, Social Network, a story about Mark Zuckerberg(founder of Facebook), just in case some of you doesn't know.
You don't need money to make money.
Anybody who tells you that you need to have money in your bank account before you can start a business is depriving you of your rights.
A characteristic of an entrepeneur is raising capital through sales and selling the futures(Vision) of the company/products/services to potential investors.
Although it would have been easier if you have money in your bank account to start the business.
But, you don't need money to own your own business.
Its quite an interesting month this october, with the currency "war" going on, silver outperforming gold, launch of the 2 big IPOs in singapore & Merger of SGX & ASX.
It's an exciting time for many of us.
However, it's not good enough to just get excited over all these things and watch the trend.
Cause when there are so many events going on, there's always winners and losers.
As the currency "war" is going on, who will prevails and who will lose.
And as individual, how do you guys actually safeguard yourself?
You might ask, how does it affects me, i'm too small an individual to be affect by the big nations currency war that is going on.
Yes, i'm telling you, it's going affect you to a certain degree.
Why is US pressing the Chinese to revaluate their currency ?
Why is it that the US dollar weakens again ?
The chinese keeps their dollars low and US is weakening their dollars as well because that will help to fuel growth.
Yes, you might think it's impossible but that's how they are doing it.
By having a weak dollar, export become more affordable for your neighbours and they are more likely to buy more.
It like GREAT SINGAPORE SALES!
But thankfully, Singapore dollars is still strong.
But then if singapore dollar were to be weaken, which I don't think so, it means that your paycheque and your savings in your bank is going to be weaken as well. Something to watch out for.
And ever since silver outperform gold, is silver still a good buy ?
Or is commodities still a good buy ?
I always believe that Gold and Silver never actual appreciate or depreciate.
It's is just Gold and Silver, the reason of the price changes in Gold & Silver is because of a few factors, inflations, interests rate, and the purchasing power of our dollars, supply and demand, period.
So when you hear people says that Gold helps to hedge against inflation is true, because Gold always is worth it's value, and it never changes in value. The reason you see changes in it's prices, it not actually Gold prices changes, it the economy is changing.
So as many of you can see, having money doesn't help makes you more money, although it might come in handy compared to if you have none.
But knowledge of money and how it is changing will put you in a position to profit from these changes that are taking place around us right now!
Happy Profiting!
Over the weekend, I watch the show, Social Network, a story about Mark Zuckerberg(founder of Facebook), just in case some of you doesn't know.
You don't need money to make money.
Anybody who tells you that you need to have money in your bank account before you can start a business is depriving you of your rights.
A characteristic of an entrepeneur is raising capital through sales and selling the futures(Vision) of the company/products/services to potential investors.
Although it would have been easier if you have money in your bank account to start the business.
But, you don't need money to own your own business.
Its quite an interesting month this october, with the currency "war" going on, silver outperforming gold, launch of the 2 big IPOs in singapore & Merger of SGX & ASX.
It's an exciting time for many of us.
However, it's not good enough to just get excited over all these things and watch the trend.
Cause when there are so many events going on, there's always winners and losers.
As the currency "war" is going on, who will prevails and who will lose.
And as individual, how do you guys actually safeguard yourself?
You might ask, how does it affects me, i'm too small an individual to be affect by the big nations currency war that is going on.
Yes, i'm telling you, it's going affect you to a certain degree.
Why is US pressing the Chinese to revaluate their currency ?
Why is it that the US dollar weakens again ?
The chinese keeps their dollars low and US is weakening their dollars as well because that will help to fuel growth.
Yes, you might think it's impossible but that's how they are doing it.
By having a weak dollar, export become more affordable for your neighbours and they are more likely to buy more.
It like GREAT SINGAPORE SALES!
But thankfully, Singapore dollars is still strong.
But then if singapore dollar were to be weaken, which I don't think so, it means that your paycheque and your savings in your bank is going to be weaken as well. Something to watch out for.
And ever since silver outperform gold, is silver still a good buy ?
Or is commodities still a good buy ?
I always believe that Gold and Silver never actual appreciate or depreciate.
It's is just Gold and Silver, the reason of the price changes in Gold & Silver is because of a few factors, inflations, interests rate, and the purchasing power of our dollars, supply and demand, period.
So when you hear people says that Gold helps to hedge against inflation is true, because Gold always is worth it's value, and it never changes in value. The reason you see changes in it's prices, it not actually Gold prices changes, it the economy is changing.
So as many of you can see, having money doesn't help makes you more money, although it might come in handy compared to if you have none.
But knowledge of money and how it is changing will put you in a position to profit from these changes that are taking place around us right now!
Happy Profiting!
Monday, October 11, 2010
"Robbers" in Suit & Tie
Previously, we've been discussing on the rich, middle class & the poor.
In an idealistic world, there should be no lack. Everybody is provided for.
So in an idealistic world, there's no gap, there's no such classes as the rich, middle class or the poor.
Stay with me, we are going somewhere exciting today.
So is it possible for rich man to share his wealth with his fellow countrymen.
Man had tried that, and it didn't work.
It makes people lazy and unproductive.
Cause why should I be contributing if all my needs are provided for? Even if i'm very productive, I don't reap the rewards, somebody else does.
Out of it, capitalism was borned.
The beautiful thing about capitalism is that, you are compensated accordingly to your contributions.
So if you're poor, it simply means that you are not contributing enough to the society.
If you're in the middle class, you are contributing just enough to the society.
If you're rich, it simply means that you are contributing alot to make our world a better place to live in.
The end results is just a mirror of your contributions to our fellow men.
But the dirty truth is that, men being men, we are self centered & always thinking, " what's in for me?!"
Me included.
And because the end results help you to achieve your objective in life, giving you the luxury in life, people became obsessed with the end results when they should be focusing on the process.
When you become obsessed with the end results instead of the process, that's why you can go crazy. It doesn't matter how you do it anymore. As long as you achieved your end results.
A man want to buy a diamond ring for his wife, it cost let's say $30,000.
The man only earn $2500 per month, so he needs to save every single cent for 1 year to buy the ring.
Instead of thinking how he can contribute to the society to be compensated well enough to buy the ring for his wife, he wants instant gratification.
So he gamble, 4D, toto.
Quick bucks, illegal activities.
In the book Think and Grow Rich, the author, Mr Hill mentioned that, true success is getting what you want without violating the rights of your fellow men.
But the world is changing in such a way that, when people wants to achieve their objectives, they violate the rights of their fellowmen to achieve what they want.
People steal, but this time round, they do it legally.
Without being labelled as a crook.
They wear an expensive suit with a branded tie.
They bang on your financial ignorance to prosper themselves.
They violate your rights and breach your trust to make themselves rich.
They take debts and package them beautifully and sell it to you as an asset.
Did anybody comes into your mind?
And the biggest financial headlines right now, how does it sounds in the light of what I've said?
http://sg.yfittopostblog.com/2010/10/10/clients-need-to-be-mindful-say-insurance-agents/
According to the news, it is the first case in singapore that the agent package a non-existence policy and sell it to her client as an asset.
Creativity perverted.
Regardless whether the agent or the client is at fault as the verdict isn't out yet.
In an idealistic world, there should be no lack. Everybody is provided for.
So in an idealistic world, there's no gap, there's no such classes as the rich, middle class or the poor.
Stay with me, we are going somewhere exciting today.
So is it possible for rich man to share his wealth with his fellow countrymen.
Man had tried that, and it didn't work.
It makes people lazy and unproductive.
Cause why should I be contributing if all my needs are provided for? Even if i'm very productive, I don't reap the rewards, somebody else does.
Out of it, capitalism was borned.
The beautiful thing about capitalism is that, you are compensated accordingly to your contributions.
So if you're poor, it simply means that you are not contributing enough to the society.
If you're in the middle class, you are contributing just enough to the society.
If you're rich, it simply means that you are contributing alot to make our world a better place to live in.
The end results is just a mirror of your contributions to our fellow men.
But the dirty truth is that, men being men, we are self centered & always thinking, " what's in for me?!"
Me included.
And because the end results help you to achieve your objective in life, giving you the luxury in life, people became obsessed with the end results when they should be focusing on the process.
When you become obsessed with the end results instead of the process, that's why you can go crazy. It doesn't matter how you do it anymore. As long as you achieved your end results.
A man want to buy a diamond ring for his wife, it cost let's say $30,000.
The man only earn $2500 per month, so he needs to save every single cent for 1 year to buy the ring.
Instead of thinking how he can contribute to the society to be compensated well enough to buy the ring for his wife, he wants instant gratification.
So he gamble, 4D, toto.
Quick bucks, illegal activities.
In the book Think and Grow Rich, the author, Mr Hill mentioned that, true success is getting what you want without violating the rights of your fellow men.
But the world is changing in such a way that, when people wants to achieve their objectives, they violate the rights of their fellowmen to achieve what they want.
People steal, but this time round, they do it legally.
Without being labelled as a crook.
They wear an expensive suit with a branded tie.
They bang on your financial ignorance to prosper themselves.
They violate your rights and breach your trust to make themselves rich.
They take debts and package them beautifully and sell it to you as an asset.
Did anybody comes into your mind?
And the biggest financial headlines right now, how does it sounds in the light of what I've said?
http://sg.yfittopostblog.com/2010/10/10/clients-need-to-be-mindful-say-insurance-agents/
According to the news, it is the first case in singapore that the agent package a non-existence policy and sell it to her client as an asset.
Creativity perverted.
Regardless whether the agent or the client is at fault as the verdict isn't out yet.
Thursday, September 30, 2010
"Investing' is a need: part 2 - Insanity
Albert Einstein defines Insanity as doing the same thing over and over again and expecting different results.
If his definition of Insanity still holds true today, at least half the populations are insane.
Previously, we were talking about the different "asset" class that the poor, middle class and the rich invests in.
There are people, especially those that belongs to the middle class, investing in the "asset" class of the poor and middle class and expecting to achieve the rich people kind of results.
No wonder they are wondering when will the "big waves" come to ride them up to be on the same level as the rich.
The middle class expects the "big waves" to come to them while they are at their comfort zone while the rich get out of their comfort zone to go to the "big waves".
The Pareto's Principle (also known as the 80-20 rule) states that in anything a few(20%) are vital, and many(80%) are trivial.
And in Pareto's case it meant 20 percent of the people owned 80 percent of the wealth.
It holds true in the Industrial Ages.
But as we entered into the Information Ages, I believe personally that the 10 - 90 rules holds true in the world of money.
That the 10 percent richest owns 90 percent of the wealth in the world.
Accoding to a survey done in america @ http://www.mybudget360.com/top-1-percent-control-42-percent-of-financial-wealth-in-the-us-how-average-americans-are-lured-into-debt-servitude-by-promises-of-mega-wealth/ .
That the top 1% owns 42% of the wealth US.
This means that the middle class is shrinking.
As we are entering into the core of the Information ages, there will be more multi millionaires than ever, and there will be more poor people needing a handout from the government or the rich to help them to just "get by" life.
Which category will you fall into ? I know that I will be among the rich.
Investing for capital gain is the playground for the middle class, although once in a while the rich comes in and take what is rightly theirs.
For many of us, security is our focus.
But security in a job never buys you riches of the rich.
Because you are working for the rich, and how will they pay you more than themselves?
A part of us wanted to be like the rich, yet unwilling to step out of our "comfort" zone into a world of temporary discomfort.
So coming out with a doctrine for this group of middle class is the fastest way to make money.
The financial predators taught us to "invest" like the middle class & telling us that it will bring us into the world of the rich, yet allowing us to stay in our comfort zone.
What they are telling us only happens in fairytales.
And fairytales isn't just for the children.
People like you and me buy into fairytales hoping that it will come true in life.
You cannot do the same thing over and over again and expecting different results.
That's crazy!
If his definition of Insanity still holds true today, at least half the populations are insane.
Previously, we were talking about the different "asset" class that the poor, middle class and the rich invests in.
There are people, especially those that belongs to the middle class, investing in the "asset" class of the poor and middle class and expecting to achieve the rich people kind of results.
No wonder they are wondering when will the "big waves" come to ride them up to be on the same level as the rich.
The middle class expects the "big waves" to come to them while they are at their comfort zone while the rich get out of their comfort zone to go to the "big waves".
The Pareto's Principle (also known as the 80-20 rule) states that in anything a few(20%) are vital, and many(80%) are trivial.
And in Pareto's case it meant 20 percent of the people owned 80 percent of the wealth.
It holds true in the Industrial Ages.
But as we entered into the Information Ages, I believe personally that the 10 - 90 rules holds true in the world of money.
That the 10 percent richest owns 90 percent of the wealth in the world.
Accoding to a survey done in america @ http://www.mybudget360.com/top-1-percent-control-42-percent-of-financial-wealth-in-the-us-how-average-americans-are-lured-into-debt-servitude-by-promises-of-mega-wealth/ .
That the top 1% owns 42% of the wealth US.
This means that the middle class is shrinking.
As we are entering into the core of the Information ages, there will be more multi millionaires than ever, and there will be more poor people needing a handout from the government or the rich to help them to just "get by" life.
Which category will you fall into ? I know that I will be among the rich.
Investing for capital gain is the playground for the middle class, although once in a while the rich comes in and take what is rightly theirs.
For many of us, security is our focus.
But security in a job never buys you riches of the rich.
Because you are working for the rich, and how will they pay you more than themselves?
A part of us wanted to be like the rich, yet unwilling to step out of our "comfort" zone into a world of temporary discomfort.
So coming out with a doctrine for this group of middle class is the fastest way to make money.
The financial predators taught us to "invest" like the middle class & telling us that it will bring us into the world of the rich, yet allowing us to stay in our comfort zone.
What they are telling us only happens in fairytales.
And fairytales isn't just for the children.
People like you and me buy into fairytales hoping that it will come true in life.
You cannot do the same thing over and over again and expecting different results.
That's crazy!
Thursday, September 23, 2010
"Investing" is a need
I would like to clear some misconception about investing, and I would like to ask my readers to "hear" me with an open mind.
Misconception No.
1. Investing is risky
2. Investing is only for the "rich"
3. Investing is not my cup of tea.
4. Since I'm not a finance student, it's "safer" for me not to invest, instead I'll get my master, work hard, save money.
5. I have no money, therefore, I don't invest.
When I say investing, I'm not just saying investing in unit trust or the stock market.
Everybody is investing regardless you know it or not, it's just that different group of people invest in different things.
Let's see the differences in what the poor, the middle class, the rich invests in.
The Poor invests in,
1. Children
I'm not against you having children, and I personally know of some of the very rich people having alot of children because they love kids and like to groom their kids and see them growing up useful to the society. One of the example is Ng Teng Fong.
But generally, all over the world, we can tell that the poor generally invests in children.
Just like my grandparents have 8 kids, and i believe your grandparents have alot as well.
For asian like us, it's only right for us to take care of our parents when they grow old, so by having more kids, they would in a way have a better retirement.
And, during their times, our country is not as prosperous as it is today.
2. Invests in "depreciating" material gains.
Once they get some money, they first thing they spend their money on is a good meal way beyond their budget, buying things for instant gratifications, and before you know it, that stuffs is being thrown away.
3. Invests in poor mindset.
Usually, this group of people submit to Fate that this is their life.
They don't bother to do anything to make themselves more valuable to the society.
People in this category always say things like," last time i never study hard, that's why now i'm poor"
They don't realised that our greatest asset is not a degree from harvey, but our ability to think.
I can show you examples of people who didn't even complete secondary school yet is richer than people who have a 1st class degree. They can actually start by thinking "how can I add more value to my workplace so that my boss notice me?" or "I must do my job to the best of my ability!"
People with this mind-set seldom stay poor for long.
Let's move on to what the middle class invests in.
1. A good education/degree
2. A secure job with good benefits
3. get married and buy a house(thinking that their house is their greatest investment)
4. Save money for one group of middle class/ bad debts through credit for another group of middle class
5. Invests the remaining into a well balanced, deversified portfolio of unit trust.
Finally,
let's take a look at what the rich invest in
1. Financial knowledge
2. how money works
3. Real estate
4. Hedge fund/Private equities/ Private placement Investment
5. Business
6. Good real estate & insurance & stock broker (the rich pays these group of advisors very well)
7. Lawyers & accountant & doctor (the rich pays these group of advisors very well)
They don't try to cut corners when meeting up with their brokers and say that their rates are too expensive.
They understand that the advise that comes out from the mouth is worth more than that few dollars.
Knowing these, knowing that we all invest, why not invest in something that helps us to get to our financial goals, instead of doing things that will keep us poor or just mediocre at best.
I'll move on into details next week!
See you again.
Misconception No.
1. Investing is risky
2. Investing is only for the "rich"
3. Investing is not my cup of tea.
4. Since I'm not a finance student, it's "safer" for me not to invest, instead I'll get my master, work hard, save money.
5. I have no money, therefore, I don't invest.
When I say investing, I'm not just saying investing in unit trust or the stock market.
Everybody is investing regardless you know it or not, it's just that different group of people invest in different things.
Let's see the differences in what the poor, the middle class, the rich invests in.
The Poor invests in,
1. Children
I'm not against you having children, and I personally know of some of the very rich people having alot of children because they love kids and like to groom their kids and see them growing up useful to the society. One of the example is Ng Teng Fong.
But generally, all over the world, we can tell that the poor generally invests in children.
Just like my grandparents have 8 kids, and i believe your grandparents have alot as well.
For asian like us, it's only right for us to take care of our parents when they grow old, so by having more kids, they would in a way have a better retirement.
And, during their times, our country is not as prosperous as it is today.
2. Invests in "depreciating" material gains.
Once they get some money, they first thing they spend their money on is a good meal way beyond their budget, buying things for instant gratifications, and before you know it, that stuffs is being thrown away.
3. Invests in poor mindset.
Usually, this group of people submit to Fate that this is their life.
They don't bother to do anything to make themselves more valuable to the society.
People in this category always say things like," last time i never study hard, that's why now i'm poor"
They don't realised that our greatest asset is not a degree from harvey, but our ability to think.
I can show you examples of people who didn't even complete secondary school yet is richer than people who have a 1st class degree. They can actually start by thinking "how can I add more value to my workplace so that my boss notice me?" or "I must do my job to the best of my ability!"
People with this mind-set seldom stay poor for long.
Let's move on to what the middle class invests in.
1. A good education/degree
2. A secure job with good benefits
3. get married and buy a house(thinking that their house is their greatest investment)
4. Save money for one group of middle class/ bad debts through credit for another group of middle class
5. Invests the remaining into a well balanced, deversified portfolio of unit trust.
Finally,
let's take a look at what the rich invest in
1. Financial knowledge
2. how money works
3. Real estate
4. Hedge fund/Private equities/ Private placement Investment
5. Business
6. Good real estate & insurance & stock broker (the rich pays these group of advisors very well)
7. Lawyers & accountant & doctor (the rich pays these group of advisors very well)
They don't try to cut corners when meeting up with their brokers and say that their rates are too expensive.
They understand that the advise that comes out from the mouth is worth more than that few dollars.
Knowing these, knowing that we all invest, why not invest in something that helps us to get to our financial goals, instead of doing things that will keep us poor or just mediocre at best.
I'll move on into details next week!
See you again.
Tuesday, September 7, 2010
Not too long back
It's not too long back since majority of the population is made up of small business owners instead of employees working for the monopolies of businesses.
Yet as I talk to people around me today, they asked me the same questions like
1. If everybody is going to start our own business, who is going to work for you?
2. If everybody is going to start our own business, businesses will no longer be profitable.
I feel that these are unrealistic fears.
It's not too long back when some of our grand parents or great grand parents own a farm or a plantation.
Having your own cattles and selling it for money(i mean real money) or exchanging it for the commodities which we need with other "business owners" in other industries.
The reason we felt that it's impossible for the majority to have their own business is the way we are taught since we are young.
Our parents and our school system taught us to study hard, so that we can get a high paying job.
Job is working for the rich people, minding their businesses, making money for them.
From young, we are taught to prosper other people but not prospering ourselves.
Ever since the start of the Industrial Age, it makes more sense to work for the big business owner than to try to start your own businesses.
Because big businesses provides you with a stable paycheck.
AND they provides you with a paycheck for LIFE!
But recently, not too long ago, companies no longer wants to pay it's staffs for life.
Instead, we have what we called the CPF in singapore.
Where your employer match your contribution in this retirement account.
With effect of this law, employees no longer have a stable paycheque for life, after retirement,
should they spend finish their money in the retirement account, they are left on their own.
unlike a paycheck for life, you finish spending this month income, you just starve yourself till next month and a new paycheque will come in.
Businesses only realised after a while that the an income for life pension plan is too expensive an expenses for the business.
But with today inflation rate, having an income for life pension plan also doesn't guaranteed a comfortable retirement.
Not to mention having an account call CPF, where your employer match your contribution.
So why does people still play by the old rules of life, get a job, and look out for better jobs with better prospect with better paycheque, every night check your email for job updates.
They thought that always looking out for better prospect, better paying job is the smart thing to do, but actually, they are still living in the Industrial Age.
They doesn't realised we have already moved on into the Information Age.
I'm not against you having a job, receiving a paycheque.
But i'm against you having a job because you doesn't have a choice, you need a paycheque.
Put it this way, having to work at a job you hate is evil.
Having not enough money to support your current lifestyle and family is evil.
It is the lack of money or so call "greed" that cause people to do stupid things,
example gambling.
Have you experienced first hand of people around you committing suicide due to compulsive gambling and being in debt and unable to pay the debt.
And what happened?
These people took the easy way out, they get out of this world by choice.
And the very reason they went into gambling is because they lack money, they resort to gambling, all in the name of loving their families.
But the lack of knowledge to make more money to provide for their lifestyle and family is evil.
So I decided to write a blog, to share my knowledge with all of you, hoping that it will benefit you guys.
Yet as I talk to people around me today, they asked me the same questions like
1. If everybody is going to start our own business, who is going to work for you?
2. If everybody is going to start our own business, businesses will no longer be profitable.
I feel that these are unrealistic fears.
It's not too long back when some of our grand parents or great grand parents own a farm or a plantation.
Having your own cattles and selling it for money(i mean real money) or exchanging it for the commodities which we need with other "business owners" in other industries.
The reason we felt that it's impossible for the majority to have their own business is the way we are taught since we are young.
Our parents and our school system taught us to study hard, so that we can get a high paying job.
Job is working for the rich people, minding their businesses, making money for them.
From young, we are taught to prosper other people but not prospering ourselves.
Ever since the start of the Industrial Age, it makes more sense to work for the big business owner than to try to start your own businesses.
Because big businesses provides you with a stable paycheck.
AND they provides you with a paycheck for LIFE!
But recently, not too long ago, companies no longer wants to pay it's staffs for life.
Instead, we have what we called the CPF in singapore.
Where your employer match your contribution in this retirement account.
With effect of this law, employees no longer have a stable paycheque for life, after retirement,
should they spend finish their money in the retirement account, they are left on their own.
unlike a paycheck for life, you finish spending this month income, you just starve yourself till next month and a new paycheque will come in.
Businesses only realised after a while that the an income for life pension plan is too expensive an expenses for the business.
But with today inflation rate, having an income for life pension plan also doesn't guaranteed a comfortable retirement.
Not to mention having an account call CPF, where your employer match your contribution.
So why does people still play by the old rules of life, get a job, and look out for better jobs with better prospect with better paycheque, every night check your email for job updates.
They thought that always looking out for better prospect, better paying job is the smart thing to do, but actually, they are still living in the Industrial Age.
They doesn't realised we have already moved on into the Information Age.
I'm not against you having a job, receiving a paycheque.
But i'm against you having a job because you doesn't have a choice, you need a paycheque.
Put it this way, having to work at a job you hate is evil.
Having not enough money to support your current lifestyle and family is evil.
It is the lack of money or so call "greed" that cause people to do stupid things,
example gambling.
Have you experienced first hand of people around you committing suicide due to compulsive gambling and being in debt and unable to pay the debt.
And what happened?
These people took the easy way out, they get out of this world by choice.
And the very reason they went into gambling is because they lack money, they resort to gambling, all in the name of loving their families.
But the lack of knowledge to make more money to provide for their lifestyle and family is evil.
So I decided to write a blog, to share my knowledge with all of you, hoping that it will benefit you guys.
Sunday, August 29, 2010
Save or be in debt ?
We are all taught to save money from a young age, or at least that's what i choose to believe.
But is saving money a financially smart move ?
I mean saving money throughout your entire working life, is it a smart move?
Some people would say yes, saving for rainy days you would say.
But really, think about it again, is it a really really smart move?
Inflation is a platform that is used to steal your wealth with or without you knowing if you are a saver.
I can work for my entire life saving for my child's education or my retirement, but when I need the money to pay for them, I realised money wasn't as valuable as when compared to the point of time when I saved my money.
And to save for a child's education can takes alot of time considering that most of us are heartlanders.
Years after years of hard earned money goes into savings, and my child spend my savings within 3 years. Well done man you kids!
Many of us couldn't save money as fast as the inflation is growing, and therein lies the danger.
If you could save money to grow as fast as our inflation, your money retains it's value.
Ironically,
It makes sense in our world today to be in debt, imagine me borrowing $1000 from you.
I'll return you the $1000 in 1 year time.
Which make more sense ? save or be in debt ?
That's provided there's no interests on the $1000.
And I believe that "ah longs" understand this and make it into a "lucrative" business, BUT it is illegal and our authorities is coming down very hard on illegal money lenders.
Even if they don't splash paints on your doors & chain up your house, it will still be illegal.
Because it's like robbing the people through it's absurd interests rate.
But seriously, don't you agree with me if money is all you want, it's a very good business?
So what else can we do?
Open a bank ?
Lend people money to pay for their condos and cars, and charge them more reasonable interests on that.
Or personal line of credit ?
Are you aware that your credit card actually have a facility call credit line or line of credit, which you can up your limits to 4 times your earned income. (Some of the banks I know of they offer 4times your earned income, might be more or less)
You can withdraw the money from their atm to buy anything you want to just in case some of you might argue some items you want to buy might not accept credit cards.
Many of you understand that our currency is being peg to the US dollar.
Till date, US dollar is still THE dollar.
But what many of you don't realized is that, our currency today is no longer money, it's debt.
There is no real value in our currency today, people accept our currency due to good faith on your government and the employees in the country able to pay it taxes.
Prior to 1971,
every US dollar is peg to gold or silver, meaning, for every dollar notes out there circulating, there is a physical gold or silver in the bank to back the piece of paper up.
After 1971, ever since president Nixon severe the relationship between dollars and golds, something changed.
Means you don't need to have a physical gold or silver in the bank to circulate that piece of paper anymore.
Instantaneously, our currency which used to be an asset, became a debt instead, which is back by good faith of our nation and it's economy.
Knowing this truth, hiding your money in your milo tin under your bed is no longer a wise financial move.
But is saving money a financially smart move ?
I mean saving money throughout your entire working life, is it a smart move?
Some people would say yes, saving for rainy days you would say.
But really, think about it again, is it a really really smart move?
Inflation is a platform that is used to steal your wealth with or without you knowing if you are a saver.
I can work for my entire life saving for my child's education or my retirement, but when I need the money to pay for them, I realised money wasn't as valuable as when compared to the point of time when I saved my money.
And to save for a child's education can takes alot of time considering that most of us are heartlanders.
Years after years of hard earned money goes into savings, and my child spend my savings within 3 years. Well done man you kids!
Many of us couldn't save money as fast as the inflation is growing, and therein lies the danger.
If you could save money to grow as fast as our inflation, your money retains it's value.
Ironically,
It makes sense in our world today to be in debt, imagine me borrowing $1000 from you.
I'll return you the $1000 in 1 year time.
Which make more sense ? save or be in debt ?
That's provided there's no interests on the $1000.
And I believe that "ah longs" understand this and make it into a "lucrative" business, BUT it is illegal and our authorities is coming down very hard on illegal money lenders.
Even if they don't splash paints on your doors & chain up your house, it will still be illegal.
Because it's like robbing the people through it's absurd interests rate.
But seriously, don't you agree with me if money is all you want, it's a very good business?
So what else can we do?
Open a bank ?
Lend people money to pay for their condos and cars, and charge them more reasonable interests on that.
Or personal line of credit ?
Are you aware that your credit card actually have a facility call credit line or line of credit, which you can up your limits to 4 times your earned income. (Some of the banks I know of they offer 4times your earned income, might be more or less)
You can withdraw the money from their atm to buy anything you want to just in case some of you might argue some items you want to buy might not accept credit cards.
Many of you understand that our currency is being peg to the US dollar.
Till date, US dollar is still THE dollar.
But what many of you don't realized is that, our currency today is no longer money, it's debt.
There is no real value in our currency today, people accept our currency due to good faith on your government and the employees in the country able to pay it taxes.
Prior to 1971,
every US dollar is peg to gold or silver, meaning, for every dollar notes out there circulating, there is a physical gold or silver in the bank to back the piece of paper up.
After 1971, ever since president Nixon severe the relationship between dollars and golds, something changed.
Means you don't need to have a physical gold or silver in the bank to circulate that piece of paper anymore.
Instantaneously, our currency which used to be an asset, became a debt instead, which is back by good faith of our nation and it's economy.
Knowing this truth, hiding your money in your milo tin under your bed is no longer a wise financial move.
Wednesday, August 18, 2010
Learn the rules of the game
Sunshine Empire head jailed
http://www.straitstimes.com/BreakingNews/Singapore/Story/STIStory_560214.html
They amassed over SGD 180 millions dollars
That's $180,000,000!
Jailed 9 years & fined $60,000.
What is that compared to the $180millions?
As much as this is an extreme case of a ponzi scheme at work in singapore, it is not an isolated case.
Who's fault is it anyway ?
Is it their fault? definitely to a certain extent.
or should MAS tighten their investment guidelines?
or is it the consumers fault ?
"Without financial education, your money flows to those who profit most from your financial ignorance." - Robert Kiyosaki
Or should we invest with the mega banks so that it will be safer?
As you will remembered, the SEC sued Goldman Sachs for fraud and eventually fined Goldman $550million - on Goldman's condition that they didn't have to plead any wrongdoing and drop the lawsuit.
The fine, $550millions, one of the largest fine the world have ever seen, is nothing compared to the damages they have done to the world's economy.
$550millions dollar is alot to people like you and me.
But if you realised, $550million is only 3 days income to Goldman.
When it comes to investing,
there are 3 groups of people.
1st group is what i call the gamblers,
they talk to themselves and then convinced themselves on why they can buy a particular investment and they just buy it, and then they pray that it will make them money.
or it might be their friends tell them certain stocks good, can buy, will hit a certain price by a certain date, their friends are so sure of that but is still holding on to a day job which pays them $2000 every month, work 10 hours a day.
2nd group of investors is this group of people who invest to win,
they do their market research, they find out everything about the investments or stocks and how it works, and only when they are really sure that it is a good investment, then they buy in.
They are the professional investors who is studying everyday to become better investors.
There are this 3rd group of investors, people who invest not to lose.
you asked me, i thought everybody invest to win ?
no, you might be surprise. Alot of people invest today just not to lose.
Have you ever met certain people who brought some shares at let's say $2, but once they buy,
they price drop to $1.50.
Then they pray and say, i will sell once the price hit $2, so that i get back my capital.
If only they put their money in the bank, they will save on the agony of watching the stocks go up and down.
Which group do you belongs to ?
And which group do you want to move into if you're not satisfied with where you are right now?
http://www.straitstimes.com/BreakingNews/Singapore/Story/STIStory_560214.html
They amassed over SGD 180 millions dollars
That's $180,000,000!
Jailed 9 years & fined $60,000.
What is that compared to the $180millions?
As much as this is an extreme case of a ponzi scheme at work in singapore, it is not an isolated case.
Who's fault is it anyway ?
Is it their fault? definitely to a certain extent.
or should MAS tighten their investment guidelines?
or is it the consumers fault ?
"Without financial education, your money flows to those who profit most from your financial ignorance." - Robert Kiyosaki
Or should we invest with the mega banks so that it will be safer?
As you will remembered, the SEC sued Goldman Sachs for fraud and eventually fined Goldman $550million - on Goldman's condition that they didn't have to plead any wrongdoing and drop the lawsuit.
The fine, $550millions, one of the largest fine the world have ever seen, is nothing compared to the damages they have done to the world's economy.
$550millions dollar is alot to people like you and me.
But if you realised, $550million is only 3 days income to Goldman.
When it comes to investing,
there are 3 groups of people.
1st group is what i call the gamblers,
they talk to themselves and then convinced themselves on why they can buy a particular investment and they just buy it, and then they pray that it will make them money.
or it might be their friends tell them certain stocks good, can buy, will hit a certain price by a certain date, their friends are so sure of that but is still holding on to a day job which pays them $2000 every month, work 10 hours a day.
2nd group of investors is this group of people who invest to win,
they do their market research, they find out everything about the investments or stocks and how it works, and only when they are really sure that it is a good investment, then they buy in.
They are the professional investors who is studying everyday to become better investors.
There are this 3rd group of investors, people who invest not to lose.
you asked me, i thought everybody invest to win ?
no, you might be surprise. Alot of people invest today just not to lose.
Have you ever met certain people who brought some shares at let's say $2, but once they buy,
they price drop to $1.50.
Then they pray and say, i will sell once the price hit $2, so that i get back my capital.
If only they put their money in the bank, they will save on the agony of watching the stocks go up and down.
Which group do you belongs to ?
And which group do you want to move into if you're not satisfied with where you are right now?
Tuesday, August 3, 2010
Is It a Sales Pitch or Is It a financial advice ?
We are continuing our series on "Is your advisor an asset or liability?"
Today we are going to touch a little bit more on identifying your advisor and his/her abilities.
The number one issue in our country today is retirement planning.
Your agent ask you, have you thought of saving for your retirement?
Sundays times also share on a projection amount which you need in order to retire comfortably.
The most common solutions that i know of is a 25years saving plan. Agents are literally, not figuratively selling them anyway and everywhere. Throw in a cash withdrawal options and it's every young graduate dream plan.
Then, there are another more atas group of agents, who believe in investment linked. They argued, the returns from an endowment is not good enough to hedge against inflations. So we need an investment linked policy to hedge against inflations and on top of that, giving my clients good returns for his/her money.
I sincerely believed both group of agents think that they are doing their clients a favor.
Though their intention is good, but the lack of knowledge will caused them some problems in the near future. But i will not touch on that in this post.
Whenever your agents recommend you an investment linked product, as you know there are higher risk involved in such products and its totally non guaranteed, so initially, most of us would be paralyzed by this fact. And our agents will pacify us by saying
"Don't worry, as long as you invest for the long term, do dollar cost averaging and diversify your portfolio, everything will be fine."
They are right. But your agent haven't finish what he/she wants to say.
Everything will be fine provided the market always go up, they are saying that as long as the market always go up, it is safe.
So when your agent is talking, please don't cut him off.
But I beg to differ.
Anyway, Is that a Sales pitch or Is that a financial advice ?
IF you are still not convinced, they will tell you, why not we put your money in bond funds. instead of equities funds.
It's lower risk, but also give you a lower returns.
Equity higher risk, but also higher returns !
Then people assumed that their agents know their stuffs.
The agent assumed the fund managers know what they are doing.
In the end, you make an ASS out of U and ME.
When your agent asked you to buy equities, you should asked, "what is equities?"(if you do not already know)
Ask them to take this financial term and put it into layman's term for you to understand.
Ask them "What is bonds? you say lower risk, why is it lower risk compared to equities?"
Ask them "how does bonds and equities work?"
I think you get my point, my point is that you make sure you understand the investment well before you buy.
You think your agent understand it well, i can tell you, more than 50% of the agents selling you bonds and equities totally have no idea what are they actually.
So it is important for yourself, the consumers to understand what you are buying.
It's not about the guidelines and rules set by MAS to govern the financial industry.
I think guidelines and rules has it's place but the emphasis should be on your own financial education.
Today we are going to touch a little bit more on identifying your advisor and his/her abilities.
The number one issue in our country today is retirement planning.
Your agent ask you, have you thought of saving for your retirement?
Sundays times also share on a projection amount which you need in order to retire comfortably.
The most common solutions that i know of is a 25years saving plan. Agents are literally, not figuratively selling them anyway and everywhere. Throw in a cash withdrawal options and it's every young graduate dream plan.
Then, there are another more atas group of agents, who believe in investment linked. They argued, the returns from an endowment is not good enough to hedge against inflations. So we need an investment linked policy to hedge against inflations and on top of that, giving my clients good returns for his/her money.
I sincerely believed both group of agents think that they are doing their clients a favor.
Though their intention is good, but the lack of knowledge will caused them some problems in the near future. But i will not touch on that in this post.
Whenever your agents recommend you an investment linked product, as you know there are higher risk involved in such products and its totally non guaranteed, so initially, most of us would be paralyzed by this fact. And our agents will pacify us by saying
"Don't worry, as long as you invest for the long term, do dollar cost averaging and diversify your portfolio, everything will be fine."
They are right. But your agent haven't finish what he/she wants to say.
Everything will be fine provided the market always go up, they are saying that as long as the market always go up, it is safe.
So when your agent is talking, please don't cut him off.
But I beg to differ.
Anyway, Is that a Sales pitch or Is that a financial advice ?
IF you are still not convinced, they will tell you, why not we put your money in bond funds. instead of equities funds.
It's lower risk, but also give you a lower returns.
Equity higher risk, but also higher returns !
Then people assumed that their agents know their stuffs.
The agent assumed the fund managers know what they are doing.
In the end, you make an ASS out of U and ME.
When your agent asked you to buy equities, you should asked, "what is equities?"(if you do not already know)
Ask them to take this financial term and put it into layman's term for you to understand.
Ask them "What is bonds? you say lower risk, why is it lower risk compared to equities?"
Ask them "how does bonds and equities work?"
I think you get my point, my point is that you make sure you understand the investment well before you buy.
You think your agent understand it well, i can tell you, more than 50% of the agents selling you bonds and equities totally have no idea what are they actually.
So it is important for yourself, the consumers to understand what you are buying.
It's not about the guidelines and rules set by MAS to govern the financial industry.
I think guidelines and rules has it's place but the emphasis should be on your own financial education.
Monday, July 26, 2010
Is your financial advisor an asset or liability ?
Previously, we were discussing about is insurances an asset or liability and that leads us to today's topic of "Is your financial advisor an asset or liability?"
Warrent Buffet has this to say about financial advice from Wall Street.
"Wall street is the only place that people ride in a Rolls-Royce to get advice from those that take the subway"
Don't get me wrong, there are many dedicated agents out there who is sincere in making your financial future secure and i believe i'm part of it.
But in these past years, financial planning industry have been a growing trend in our country, maybe due to the fact that the aging populations group wanting to do something about their retirements.
To be qualified to advise on other people financial futures, all you need is 3 papers within a month, and i cleared them on my first attempts and thus that shows that i'm passionate about financial planning industry.
ok, cut the long story short, it takes you a longer time to become a qualified roti prata man making good tasting prata than it is to become a financial advisor and start giving advise on people's financial futures.
An advisor who is able to help you makes the right financial decision in life is an asset.
An advisor who is able to help you makes money is an asset.
An advisor who is working towards helping you and making sure you have enough for retirement is an asset.
Pay your advisors well, and they will give you good advice.
Try to be cheap with them and you get the worst advice, and you deserve it.
The worst financial advice are FREE advice.
Just like no good things in life come to you for free.
A few questions to note that if your financial advisor is doing a good job for you is,
given the same set of circumstances, will your advisors do the same thing which he/she adviced you to do?
When asking you to invest into their funds, will he or she buys the same funds at the same time as you do?
And for your investment banker, how much of his/her income comes from investment portfolio?
or does his/her income comes mainly from selling financial products(vehicles) to you?
"earned income"
Our financial institute recognized producers.
Once every year, if you read your papers, they will have pictures of their top advisors on the front page according to their contributions to the company.
What is the paper saying?
BEST SALES PERSON.
keyword here is SALES.
The title didn't says like "Most dedicated agent" or "Most Caring agent"
or "Best advising agent".
There is a co-relation between Sales and being dedicated and caring and giving good advise.
But that does not means that all the top agents are dedicated or caring and is giving good advise.
In the world of sales and financial planning, you might be amazed at what some people are doing to be at the top. It's just like beautiful football does not always win the competitions, but i'm glad spain won.
I'll paused for you to digest.
Be back soon.
Warrent Buffet has this to say about financial advice from Wall Street.
"Wall street is the only place that people ride in a Rolls-Royce to get advice from those that take the subway"
Don't get me wrong, there are many dedicated agents out there who is sincere in making your financial future secure and i believe i'm part of it.
But in these past years, financial planning industry have been a growing trend in our country, maybe due to the fact that the aging populations group wanting to do something about their retirements.
To be qualified to advise on other people financial futures, all you need is 3 papers within a month, and i cleared them on my first attempts and thus that shows that i'm passionate about financial planning industry.
ok, cut the long story short, it takes you a longer time to become a qualified roti prata man making good tasting prata than it is to become a financial advisor and start giving advise on people's financial futures.
An advisor who is able to help you makes the right financial decision in life is an asset.
An advisor who is able to help you makes money is an asset.
An advisor who is working towards helping you and making sure you have enough for retirement is an asset.
Pay your advisors well, and they will give you good advice.
Try to be cheap with them and you get the worst advice, and you deserve it.
The worst financial advice are FREE advice.
Just like no good things in life come to you for free.
A few questions to note that if your financial advisor is doing a good job for you is,
given the same set of circumstances, will your advisors do the same thing which he/she adviced you to do?
When asking you to invest into their funds, will he or she buys the same funds at the same time as you do?
And for your investment banker, how much of his/her income comes from investment portfolio?
or does his/her income comes mainly from selling financial products(vehicles) to you?
"earned income"
Our financial institute recognized producers.
Once every year, if you read your papers, they will have pictures of their top advisors on the front page according to their contributions to the company.
What is the paper saying?
BEST SALES PERSON.
keyword here is SALES.
The title didn't says like "Most dedicated agent" or "Most Caring agent"
or "Best advising agent".
There is a co-relation between Sales and being dedicated and caring and giving good advise.
But that does not means that all the top agents are dedicated or caring and is giving good advise.
In the world of sales and financial planning, you might be amazed at what some people are doing to be at the top. It's just like beautiful football does not always win the competitions, but i'm glad spain won.
I'll paused for you to digest.
Be back soon.
Monday, July 12, 2010
Is Insurance an asset or liability?
Before I was in this line, I've listened to different financial advisors with regards to insurance.
First time round, I was forced to listened to this "ex-major" who came to BMTC to tell us about how dangerous army was and is.
He was like saying something along this line, "You guys are combat soldiers, you guys need to do SOC (standard obstacles course), what if you break your arms during that training! who is going to take care of your mother! Don't just think about yourself, think of your parents who brought you up! This plan will compensate you blah blah blah amount if you break your arms during SOC!"
Of course, I didn't sign up! AND I AM still in 1 complete piece.
(When you are in camp for the 1st time and for the 1st week, really! that's the last thing you want to hear!)
Day 2
There are these few pretty ladies(well perphaps when you're in camp for 2 weeks, any lady seems pretty) from another local insurance company coming in to talk about saving plans, you young and handsome boys, if only you save this month of money every month, by the end of XXX amount of years, you can receive xxx amount of money.
The talk this time round seems better and more positive instead of death, breaking your arms and legs!
Still, I didn't sign up!
As much as i know even before i'm in this industry that insurance is a necessity instead of a luxury, I hesitate to sign up.
So for all my friends out there who refused to do anything with me, i totally felt what you're going through.
That brings us to our main point today,
Is Insurance an asset or liability?
I think we all should know 1 thing about insurance.
You cannot buy it when you need it.
So when should we buy ?
Before we need.
So you might or might not need them throughout your entire life.
So paying money for something that you might never get to use, doesn't that make it a liability?
Then when you need it, doesn't it immediately make it into an asset?
So to answer that question, Is it an asset or liability.
You have the answer.
If today, your concern is you need the money for your dependents until they can become independent, it's an asset.
If you need this amount of money for your retirement and a policy can do just that, it's an asset.
If your concerned is providing for your family when you're not around and an agent come around selling you an investment plan, that investment plan is a liability to you.
Yet the very same investment plan is an asset to somebody who is planning for retirement or for child's education.
An insurance plan is just an insurance plan.
But an agent who comes along who is able to identify what you need and sell you a correct plan to fit your needs, that agent is an asset to you.
Insurance is a very important piece of investment which you want to have in your portfolio, however, it's not the ONLY piece of investment.
Instead of trying to find the perfect piece of insurance to fit your life, instead try find the perfect agent who is able to help you to identify your needs.
As much as there are agents who can be asset to you in your life, there are agents who will be a liability to you.
Selling based on commission and returns instead of selling according to your needs.
Or just to give you an example to bring across the point,
Client is in his 40s and is in good health, doesn't have any medical plan.
Yet the agent sell a $5000/yr premiums investment plan and walk away.
3 months later,
Client is hospitalized and the bills came up to be $100,000.
By selling a hospital plan of let's say, $400/year, he could have save that $100,000.
So a better question to "Is insurance an asset or liability" will be " Is your insurance agent an asset or liability?"
In our next session, I will discuss on my personal opinion about questions to ask your insurance agent to identify whether he/she is suitable for you.
First time round, I was forced to listened to this "ex-major" who came to BMTC to tell us about how dangerous army was and is.
He was like saying something along this line, "You guys are combat soldiers, you guys need to do SOC (standard obstacles course), what if you break your arms during that training! who is going to take care of your mother! Don't just think about yourself, think of your parents who brought you up! This plan will compensate you blah blah blah amount if you break your arms during SOC!"
Of course, I didn't sign up! AND I AM still in 1 complete piece.
(When you are in camp for the 1st time and for the 1st week, really! that's the last thing you want to hear!)
Day 2
There are these few pretty ladies(well perphaps when you're in camp for 2 weeks, any lady seems pretty) from another local insurance company coming in to talk about saving plans, you young and handsome boys, if only you save this month of money every month, by the end of XXX amount of years, you can receive xxx amount of money.
The talk this time round seems better and more positive instead of death, breaking your arms and legs!
Still, I didn't sign up!
As much as i know even before i'm in this industry that insurance is a necessity instead of a luxury, I hesitate to sign up.
So for all my friends out there who refused to do anything with me, i totally felt what you're going through.
That brings us to our main point today,
Is Insurance an asset or liability?
I think we all should know 1 thing about insurance.
You cannot buy it when you need it.
So when should we buy ?
Before we need.
So you might or might not need them throughout your entire life.
So paying money for something that you might never get to use, doesn't that make it a liability?
Then when you need it, doesn't it immediately make it into an asset?
So to answer that question, Is it an asset or liability.
You have the answer.
If today, your concern is you need the money for your dependents until they can become independent, it's an asset.
If you need this amount of money for your retirement and a policy can do just that, it's an asset.
If your concerned is providing for your family when you're not around and an agent come around selling you an investment plan, that investment plan is a liability to you.
Yet the very same investment plan is an asset to somebody who is planning for retirement or for child's education.
An insurance plan is just an insurance plan.
But an agent who comes along who is able to identify what you need and sell you a correct plan to fit your needs, that agent is an asset to you.
Insurance is a very important piece of investment which you want to have in your portfolio, however, it's not the ONLY piece of investment.
Instead of trying to find the perfect piece of insurance to fit your life, instead try find the perfect agent who is able to help you to identify your needs.
As much as there are agents who can be asset to you in your life, there are agents who will be a liability to you.
Selling based on commission and returns instead of selling according to your needs.
Or just to give you an example to bring across the point,
Client is in his 40s and is in good health, doesn't have any medical plan.
Yet the agent sell a $5000/yr premiums investment plan and walk away.
3 months later,
Client is hospitalized and the bills came up to be $100,000.
By selling a hospital plan of let's say, $400/year, he could have save that $100,000.
So a better question to "Is insurance an asset or liability" will be " Is your insurance agent an asset or liability?"
In our next session, I will discuss on my personal opinion about questions to ask your insurance agent to identify whether he/she is suitable for you.
Wednesday, June 30, 2010
World Cup Fever
It's been a long time since i last update this site.
ya. It's world cup 2010.
England make the Germans look damn good, but in actual fact, i think they are not that fantastic.
Especially with Lampard goal so obviously over the line and the referee is like "duh".
I feel that if the Germans are going employ the same tactics against argentina as how they play england, they are going to be ripped apart !
And the odds are against germany, as of now, $3
Brazil and holland.
I would say, it's crash of the titans !
Odds reflect how strong and how well a team will perform against another.
It takes into considerations, the current performance, past performance and future(potential) performances.
I reckon it to be like buying your investment units.
Past performance, current performance and potential returns.
You are betting on the unknown with no guarantees, just that it is still cheaper than betting in World Cup because of the time when you lose, you very seldom lose 100% of your capital.
Past performances are not indicative of future performance, look at italy and france.
Where are they now ?
However, there are some investments that had been performing well throughout the years, just like our brazil .
Most of the time, somehow or rather, they will end up as the last 8, last 4.
Regardless if there's ronaldo or ronaldinho.
They still stand a chance to win the world cup.
Happy world cup-ing !
ya. It's world cup 2010.
England make the Germans look damn good, but in actual fact, i think they are not that fantastic.
Especially with Lampard goal so obviously over the line and the referee is like "duh".
I feel that if the Germans are going employ the same tactics against argentina as how they play england, they are going to be ripped apart !
And the odds are against germany, as of now, $3
Brazil and holland.
I would say, it's crash of the titans !
Odds reflect how strong and how well a team will perform against another.
It takes into considerations, the current performance, past performance and future(potential) performances.
I reckon it to be like buying your investment units.
Past performance, current performance and potential returns.
You are betting on the unknown with no guarantees, just that it is still cheaper than betting in World Cup because of the time when you lose, you very seldom lose 100% of your capital.
Past performances are not indicative of future performance, look at italy and france.
Where are they now ?
However, there are some investments that had been performing well throughout the years, just like our brazil .
Most of the time, somehow or rather, they will end up as the last 8, last 4.
Regardless if there's ronaldo or ronaldinho.
They still stand a chance to win the world cup.
Happy world cup-ing !
Sunday, June 6, 2010
Money as vehicles
What can a vehicle do for you?
It carries you from point A to point B.
Example,
From singapore to malaysia, KL.
I can choose to drive there, take a bus, take an air plane, or even, train.
what are bus, car, train ? They are vehicles.
They takes me from where i am, to where i want to go.
Money is a vehicle, it takes me from where i am(living in a HDB) to where i want to go(semi-D).
So if i earn $5000 a month, it will take a long time for me to travel from "HDB" to "semi-D".
If i earn $30,000 a month, it will take a shorter time.
It's like taking a bus to malaysia compared to taking a plane.
If i have more money, I have the luxury to choose.
If i have less money, i can only opt for a bus trip which will takes me more time.
The purpose of me wanting to have money and tons of them, it's not because I love money, It's because it helps me save time and thus giving me more opportunities to do the more important work in life.
Ultimately, i just want to get to my destinations and sometimes using different means of transport cause you know majority of the earth is made up of seas.
I enjoy the rides, however I just want to reach my destination.
Owning the vehicles or not doesn't really matters to me.
It carries you from point A to point B.
Example,
From singapore to malaysia, KL.
I can choose to drive there, take a bus, take an air plane, or even, train.
what are bus, car, train ? They are vehicles.
They takes me from where i am, to where i want to go.
Money is a vehicle, it takes me from where i am(living in a HDB) to where i want to go(semi-D).
So if i earn $5000 a month, it will take a long time for me to travel from "HDB" to "semi-D".
If i earn $30,000 a month, it will take a shorter time.
It's like taking a bus to malaysia compared to taking a plane.
If i have more money, I have the luxury to choose.
If i have less money, i can only opt for a bus trip which will takes me more time.
The purpose of me wanting to have money and tons of them, it's not because I love money, It's because it helps me save time and thus giving me more opportunities to do the more important work in life.
Ultimately, i just want to get to my destinations and sometimes using different means of transport cause you know majority of the earth is made up of seas.
I enjoy the rides, however I just want to reach my destination.
Owning the vehicles or not doesn't really matters to me.
Thursday, May 20, 2010
money talks!
The 2 hardest things for people to do,
1. is to quit overspending.
2. is to quit over saving.
The reason i highlight this 2 points is that, who doesn't want to be financially well off in our capitalistic world today?
But every month, if your income is higher or equal to or just slightly less than your expenses,
the fact is that you will never become rich, or worse, you are in debt.
Because of your mortgage loans or car loans and even credit cards loans.
Mortgage comes from the old french word for "dead pledge".
or put it across in layman's term, an engagement till death.
If you don't believe me, just ask around those newly married couple who just brought their first home, how many years of mortgage loans did they take up?
Some took up to 30 years of repayment periods because of the low monthly installment, they spend their whole working life paying the bank first.
It is true like once they sell away the house, they will make a "profit" and most of the time, property in our country will goes up in prices because of limited land space.
And there's another group of people,
what i like to call the over savers.
It comes from a teaching from one of my lecturer who says that in our lifetime, with a degree in singapore, $1,500,000 - $3,000,000 will pass through your hands in your life time, but how much of them will you be able to retain?
These over savers are usually quite sought after in their own field and is doing quite well.
And they choose to be wealthy by saving as much as possible, finding the cheapest meals and shopping during sales and always wanting to find the best bargains.
As written in rich dad poor dad,
you can become rich or even millionaire by being cheap, but when you are a millionaire, you are still a cheap millionaire.
The only reason why people today wants to earn more money and become richer is simply because they desire to have a better lifestyle for themselves and their family, so by being cheap, it totally defeat the purpose of being rich.
With the same amount of regular savings, and educating yourself a little bit more about money, you might be surprise at the outcome other than the interests that banks are offering you, ultimately, helping you to achieve what you wants.
That's is the kind of lifestyle which you only dares to dream, but now, is within your reach, if only you learn to educate yourself a little bit more.
1. is to quit overspending.
2. is to quit over saving.
The reason i highlight this 2 points is that, who doesn't want to be financially well off in our capitalistic world today?
But every month, if your income is higher or equal to or just slightly less than your expenses,
the fact is that you will never become rich, or worse, you are in debt.
Because of your mortgage loans or car loans and even credit cards loans.
Mortgage comes from the old french word for "dead pledge".
or put it across in layman's term, an engagement till death.
If you don't believe me, just ask around those newly married couple who just brought their first home, how many years of mortgage loans did they take up?
Some took up to 30 years of repayment periods because of the low monthly installment, they spend their whole working life paying the bank first.
It is true like once they sell away the house, they will make a "profit" and most of the time, property in our country will goes up in prices because of limited land space.
And there's another group of people,
what i like to call the over savers.
It comes from a teaching from one of my lecturer who says that in our lifetime, with a degree in singapore, $1,500,000 - $3,000,000 will pass through your hands in your life time, but how much of them will you be able to retain?
These over savers are usually quite sought after in their own field and is doing quite well.
And they choose to be wealthy by saving as much as possible, finding the cheapest meals and shopping during sales and always wanting to find the best bargains.
As written in rich dad poor dad,
you can become rich or even millionaire by being cheap, but when you are a millionaire, you are still a cheap millionaire.
The only reason why people today wants to earn more money and become richer is simply because they desire to have a better lifestyle for themselves and their family, so by being cheap, it totally defeat the purpose of being rich.
With the same amount of regular savings, and educating yourself a little bit more about money, you might be surprise at the outcome other than the interests that banks are offering you, ultimately, helping you to achieve what you wants.
That's is the kind of lifestyle which you only dares to dream, but now, is within your reach, if only you learn to educate yourself a little bit more.
Monday, May 3, 2010
Our Rat Race
There's a saying which i read somewhere before, it sounds something like
"Even when you win the Rat Race, You're still a rat"
Do you want to be a rat all your life ?
Working hard, getting a promotion, earn more money, get a bigger house, drive a bigger car.
I'm not against you working hard and earning a better income for your family and lifestyle.
But if you spend all your life working very hard till the extent which you don't live your own dreams, even if you make so much money, how does you feel ?
Previously when i was an employee, i look at my directors, 5 digits salary, big house nice car, but they spend their weekends doing reports and analysing charts, spend their weekdays evening together with their reluctant employees having meetings.
I thought to myself, i don't think thats what i want.
Call me lazy, call me a bum.
But i hate the idea of me generating income for somebody to fulfill their dreams yet not fulfilling my own dreams.
Earning tens of thousands for people yet i only get such a small cut out of it.
I am somebody who wants to fulfill my own dreams and therefore decided not to get caught in our rat race.
However, there are people who enjoy working 12hours a day and throughout the weekends.
Unless you're telling me that's your dreams, ...
I'm not saying that you should quit your full time job.
Continue working hard, get promoted and a pay increment.
When you get your pay cheque, please pay yourself first.
And there will come a time when you can do with or without your day job.
So that someday when you feel that the stress is too great for you to take, or you doesn't have enough time for your loved ones, you can walk out of your job without impacts on your finances.
That's when you know you're out of the rat race.
"Even when you win the Rat Race, You're still a rat"
Do you want to be a rat all your life ?
Working hard, getting a promotion, earn more money, get a bigger house, drive a bigger car.
I'm not against you working hard and earning a better income for your family and lifestyle.
But if you spend all your life working very hard till the extent which you don't live your own dreams, even if you make so much money, how does you feel ?
Previously when i was an employee, i look at my directors, 5 digits salary, big house nice car, but they spend their weekends doing reports and analysing charts, spend their weekdays evening together with their reluctant employees having meetings.
I thought to myself, i don't think thats what i want.
Call me lazy, call me a bum.
But i hate the idea of me generating income for somebody to fulfill their dreams yet not fulfilling my own dreams.
Earning tens of thousands for people yet i only get such a small cut out of it.
I am somebody who wants to fulfill my own dreams and therefore decided not to get caught in our rat race.
However, there are people who enjoy working 12hours a day and throughout the weekends.
Unless you're telling me that's your dreams, ...
I'm not saying that you should quit your full time job.
Continue working hard, get promoted and a pay increment.
When you get your pay cheque, please pay yourself first.
And there will come a time when you can do with or without your day job.
So that someday when you feel that the stress is too great for you to take, or you doesn't have enough time for your loved ones, you can walk out of your job without impacts on your finances.
That's when you know you're out of the rat race.
Tuesday, April 20, 2010
short term vs long term
I'm talking about Strategic Savings!
for short term goals and long term goals.
If you are going to lock in all your money to get higher returns over the long term for potential very high returns, then you wouldn't be able to achieve your short term goals.
Longer saving periods without flexibility(access to your cash as and when you want) will definitely gives you a higher returns.
Shorter saving periods/ with flexibility will compromise on your returns.
The same concept applies to fix saving & investments over the long haul.
However, there investors who does value investing and those "safer" investors who buy into blue chips companies.
True, there are people who make decent amount in the stock market everyday, but not everybody have the skills or/and capital to do it.
And saving for your retirement might be quite a chore to most of you, and to some of you, you might not even be thinking about it, but the past 2 weeks sunday times had been talking about retirement and we need to keep in line with them, i guess it's due to our aging population in singapore.
You just graduated & is excited about owning your first car and first house, and probably this will be the 2 most expensive purchases you will make in your life.
So Where do we go from here ?
Let's take for example, you want to retire at the age of 65 years old and you passed on at the age of 85 (average, lifespan increases due to medical advancement, is that a blessing or a curse ? )
monthly expenses $3000( in today's dollars) x 12 months x 15 years = $540,000 today's dollars
That's provided there's no inflations.
Let's assume and which is inflation on average work out to be 3% a year, and it's compounding and it's being the 8th wonders of the world ( if you don't know what it is, it means that you guys haven't been reading my blog! )
The amount will work out to be, $2,668,752.01 ! wow! compounding is really the 8th wonders of the WORLD !
ok you still have abit of CPF money to help you with this, not too bad.
then some of you protest, eh i won't be spending $3000 a month in today's dollar when i retire.
ya, some of you will have the self discipline to do that.
But i ask you ar, do you spend more during weekends or weekdays ?
Do you spend more when you go on a holiday or when you're working ?
ya! that answers your question. When you retire, it's like holidays everyday and gone are the days when you will be like those uncles sitting at the community center playing chess ?
How many of you knows how to play chinese chess? English chess ?
Think about it my friends :)
for short term goals and long term goals.
If you are going to lock in all your money to get higher returns over the long term for potential very high returns, then you wouldn't be able to achieve your short term goals.
Longer saving periods without flexibility(access to your cash as and when you want) will definitely gives you a higher returns.
Shorter saving periods/ with flexibility will compromise on your returns.
The same concept applies to fix saving & investments over the long haul.
However, there investors who does value investing and those "safer" investors who buy into blue chips companies.
True, there are people who make decent amount in the stock market everyday, but not everybody have the skills or/and capital to do it.
And saving for your retirement might be quite a chore to most of you, and to some of you, you might not even be thinking about it, but the past 2 weeks sunday times had been talking about retirement and we need to keep in line with them, i guess it's due to our aging population in singapore.
You just graduated & is excited about owning your first car and first house, and probably this will be the 2 most expensive purchases you will make in your life.
So Where do we go from here ?
Let's take for example, you want to retire at the age of 65 years old and you passed on at the age of 85 (average, lifespan increases due to medical advancement, is that a blessing or a curse ? )
monthly expenses $3000( in today's dollars) x 12 months x 15 years = $540,000 today's dollars
That's provided there's no inflations.
Let's assume and which is inflation on average work out to be 3% a year, and it's compounding and it's being the 8th wonders of the world ( if you don't know what it is, it means that you guys haven't been reading my blog! )
The amount will work out to be, $2,668,752.01 ! wow! compounding is really the 8th wonders of the WORLD !
ok you still have abit of CPF money to help you with this, not too bad.
then some of you protest, eh i won't be spending $3000 a month in today's dollar when i retire.
ya, some of you will have the self discipline to do that.
But i ask you ar, do you spend more during weekends or weekdays ?
Do you spend more when you go on a holiday or when you're working ?
ya! that answers your question. When you retire, it's like holidays everyday and gone are the days when you will be like those uncles sitting at the community center playing chess ?
How many of you knows how to play chinese chess? English chess ?
Think about it my friends :)
Tuesday, April 13, 2010
It's like Insurance against Inflations.
Ask any financial planners, and 90% of them will tell you it's investment, or investment linked policies.
Because of the returns projecting at 5% & 9%, they claims that it helps to hedge against inflations. I agree with that to a certain extent.
On average, our inflation in singapore is around 3-4% per year, so a good 5% returns on your investments would be a good medium to hedge against inflations.
Investment linked policies is just another form of insurance against inflations.
Real assets like crude oil, physical gold, real estate and commodities are also used to hedge against inflations.
Physical gold is very interesting, this idea came all the way back during my grandma times, where they know how to buy physical gold and keep them to hedge against inflations.
Talk about making money and tons of them, what make it worse when your hard earned money are depreciating in value because of inflations.
About 50 years ago, anyway, this is my dad's version of 50 years ago, 1 car is only $6000.
And $10 is alot of money.
But $10 now is not enough to even take a cab from lor ah soo to chua chu kang.
Let's say you start saving in your bank account $500,000 for your retirement and 50 years later, your $500,000 is gonna become $_____.
You fill in the gap.
Stop worrying about the non-Guaranteed returns of stocks and funds and start taking a step of faith for a better tomorrow.
But do your homework first and seek an advice from a professional adviser.
and that's me !!!
Thank you !
Because of the returns projecting at 5% & 9%, they claims that it helps to hedge against inflations. I agree with that to a certain extent.
On average, our inflation in singapore is around 3-4% per year, so a good 5% returns on your investments would be a good medium to hedge against inflations.
Investment linked policies is just another form of insurance against inflations.
Real assets like crude oil, physical gold, real estate and commodities are also used to hedge against inflations.
Physical gold is very interesting, this idea came all the way back during my grandma times, where they know how to buy physical gold and keep them to hedge against inflations.
Talk about making money and tons of them, what make it worse when your hard earned money are depreciating in value because of inflations.
About 50 years ago, anyway, this is my dad's version of 50 years ago, 1 car is only $6000.
And $10 is alot of money.
But $10 now is not enough to even take a cab from lor ah soo to chua chu kang.
Let's say you start saving in your bank account $500,000 for your retirement and 50 years later, your $500,000 is gonna become $_____.
You fill in the gap.
Stop worrying about the non-Guaranteed returns of stocks and funds and start taking a step of faith for a better tomorrow.
But do your homework first and seek an advice from a professional adviser.
and that's me !!!
Thank you !
Monday, April 5, 2010
Thank you
76% of patients satisfied with healthcare institutions in 2009
surveyBy Jeremy Koh Posted: 05 April 2010 1425 hrs
http://www.channelnewsasia.com/stories/singaporelocalnews/view/1047961/1/.html
SINGAPORE : Seventy-six per cent of patients have expressed overall satisfaction with public healthcare institutions. This is an improvement of two percentage points over findings from 2008. Seventy-eight per cent of patients also said they would recommend the services to others, compared to 73 per cent in 2008.
The improved showing was reflected in the independent 2009 Patient Satisfaction Survey commissioned by the Ministry of Health. Nearly 10,000 patients from the public hospitals, national specialty centres and polyclinics were interviewed between September and December last year. They were also asked to assess their perceptions based on nine quality service attributes, including knowledge and skills of doctors, and care and concern by nurses.
Among the hospitals, Alexandra Hospital continued to achieve the highest overall satisfaction ratings at 85 per cent.
As for national specialty centres, the Institute of Mental Health clinched the top position with a satisfaction rating of 90 per cent, while Marine Parade Polyclinic was ranked top amongst polyclinics for patient satisfaction.
But while patient satisfaction have improved, the waiting time to consult the doctor remains an area of dissatisfaction. In a statement, the Health Ministry said the healthcare institutions will have to work harder on this area.
It added that it will continue to increase the number of doctors, but said this will have an impact on operating costs.
Once again, thank you, all these are possible, people are satisfied all because of you.
As i mentioned, the healthcare industry can only reached it's fullest potential provided the insurance industry reaches it fullest potential to provide it's policy holders with a good medical coverage.
Therefore funding the best medical treatment to the people as well as paying the staffs enough so that they can serve you with utmost care & reduce waiting period to expertise things.
surveyBy Jeremy Koh Posted: 05 April 2010 1425 hrs
http://www.channelnewsasia.com/stories/singaporelocalnews/view/1047961/1/.html
SINGAPORE : Seventy-six per cent of patients have expressed overall satisfaction with public healthcare institutions. This is an improvement of two percentage points over findings from 2008. Seventy-eight per cent of patients also said they would recommend the services to others, compared to 73 per cent in 2008.
The improved showing was reflected in the independent 2009 Patient Satisfaction Survey commissioned by the Ministry of Health. Nearly 10,000 patients from the public hospitals, national specialty centres and polyclinics were interviewed between September and December last year. They were also asked to assess their perceptions based on nine quality service attributes, including knowledge and skills of doctors, and care and concern by nurses.
Among the hospitals, Alexandra Hospital continued to achieve the highest overall satisfaction ratings at 85 per cent.
As for national specialty centres, the Institute of Mental Health clinched the top position with a satisfaction rating of 90 per cent, while Marine Parade Polyclinic was ranked top amongst polyclinics for patient satisfaction.
But while patient satisfaction have improved, the waiting time to consult the doctor remains an area of dissatisfaction. In a statement, the Health Ministry said the healthcare institutions will have to work harder on this area.
It added that it will continue to increase the number of doctors, but said this will have an impact on operating costs.
Once again, thank you, all these are possible, people are satisfied all because of you.
As i mentioned, the healthcare industry can only reached it's fullest potential provided the insurance industry reaches it fullest potential to provide it's policy holders with a good medical coverage.
Therefore funding the best medical treatment to the people as well as paying the staffs enough so that they can serve you with utmost care & reduce waiting period to expertise things.
Monday, March 29, 2010
Education: Part 2
Creating a Hedge, then start growing your wealth.
In this way, You will have the desired results either by hook or by crook.
Example:
You might want to have a net worth of $5,000,000.
So you started working for it once you graduated.
You studied very hard during your colleague years and graduated with a 1st class.
And you started working for 2 years with a starting salary of $3,000 - $3,500.
And after 2 years, you went on to pursue your master.
After getting your master, you got another job, paying you $5,000 a month with a promised increment of $500 every year.
After 10 years, you'll be earning $10,000 a month without adding in your blah and blah bonuses.
And projected, you're intending to invest $5,000 every month and starting your own small business with your expertise and hoping you will achieve a net worth of $5,000,000 when you're 60 years old for retirement.
So first, it would be advisable for you to first create that $5,000,000 hedge that should anything unfortunate events were to occur, you would have achieved that $5,000,000 end results.
But if nothing happens, you can continue working towards your dreams of achieving $5,000,000 net worth.
In this way, your $5,000,000 would be secured.
But the million dollar question is, how many people actually can afford this $5,000,000 hedge?
Therefore, creating a hedge is a process. Maybe you start with $500,000 first and slowly "upgrading" your hedge to $5,000,000. So financial planning is never a one time event.
Secondly, this hedge which i talk about actually helps you to achieve your desired results, this hedge which you created helps you to increase your wealth, makes your money work harder for you, and also fulfill the "8th wonder of the world", compounding, months after months and years after years.
30 years down the road,
55 years old, you already have a networth of 4 millions dollars, you're "ON TRACK".
Then you asked me, "but now i don't need 5 million dollars hedge leh, i already got $4,000,000 net worth leh. how?"
Then you can either give it as a love gift for your loved ones when you're gone, if not, you are able to decrease your coverage & at the same time get some $$ back from this hedge, thus expertising your way to $5,000,000.
Lets say after 30 years, you decided to decrease your hedge to $1,000,000
and you received a return, lets say $500,000 from this hedge,
Effectively, $4,000,000 + $500,000 = $4,500,000 and your short fall will only be $500,000.
Isn't it great?
Yes, Life isn't just great, It's fantastic when you've such a hedge.
A Hedge that compresses time.
Good luck.
In this way, You will have the desired results either by hook or by crook.
Example:
You might want to have a net worth of $5,000,000.
So you started working for it once you graduated.
You studied very hard during your colleague years and graduated with a 1st class.
And you started working for 2 years with a starting salary of $3,000 - $3,500.
And after 2 years, you went on to pursue your master.
After getting your master, you got another job, paying you $5,000 a month with a promised increment of $500 every year.
After 10 years, you'll be earning $10,000 a month without adding in your blah and blah bonuses.
And projected, you're intending to invest $5,000 every month and starting your own small business with your expertise and hoping you will achieve a net worth of $5,000,000 when you're 60 years old for retirement.
So first, it would be advisable for you to first create that $5,000,000 hedge that should anything unfortunate events were to occur, you would have achieved that $5,000,000 end results.
But if nothing happens, you can continue working towards your dreams of achieving $5,000,000 net worth.
In this way, your $5,000,000 would be secured.
But the million dollar question is, how many people actually can afford this $5,000,000 hedge?
Therefore, creating a hedge is a process. Maybe you start with $500,000 first and slowly "upgrading" your hedge to $5,000,000. So financial planning is never a one time event.
Secondly, this hedge which i talk about actually helps you to achieve your desired results, this hedge which you created helps you to increase your wealth, makes your money work harder for you, and also fulfill the "8th wonder of the world", compounding, months after months and years after years.
30 years down the road,
55 years old, you already have a networth of 4 millions dollars, you're "ON TRACK".
Then you asked me, "but now i don't need 5 million dollars hedge leh, i already got $4,000,000 net worth leh. how?"
Then you can either give it as a love gift for your loved ones when you're gone, if not, you are able to decrease your coverage & at the same time get some $$ back from this hedge, thus expertising your way to $5,000,000.
Lets say after 30 years, you decided to decrease your hedge to $1,000,000
and you received a return, lets say $500,000 from this hedge,
Effectively, $4,000,000 + $500,000 = $4,500,000 and your short fall will only be $500,000.
Isn't it great?
Yes, Life isn't just great, It's fantastic when you've such a hedge.
A Hedge that compresses time.
Good luck.
Monday, March 22, 2010
Education
How many of you here reading agree with me that an education is important ?
It is very important especially in singapore.
Alot of times, we would expect our employers to hire on merit.
But there's an old saying, it's not what you know, it's who you know.
Which is still quite true today.
In the last 10 years, the world is changing more rapidly than it has compared to the past 100 years. We see drop out becoming millionaires.
People who had the best education doesn't necessarily be the highest paid people in our world today.
Does that means that it's ok not to seek an education?
Certainly NOT !
Although these people might be drop out of the education system in their country, however, the same group of people who are dropped out and still being able to be one of the top earnest in their countries definitely deserve our attentions, what are the ways and means and how did they do it ?
They are being taught something which were not put in our school syllabus.
Well, some of us might call that "CCA".
PR-ing.
Fair, fair.
There's still something else called the financial literacy.
And personally i believe that's what differentiate the rich and the wealthy, and creating the gap in between and rich/wealthy and the poor&middle income.
The rest is for you guys to find out.
Stay Tuned !
It is very important especially in singapore.
Alot of times, we would expect our employers to hire on merit.
But there's an old saying, it's not what you know, it's who you know.
Which is still quite true today.
In the last 10 years, the world is changing more rapidly than it has compared to the past 100 years. We see drop out becoming millionaires.
People who had the best education doesn't necessarily be the highest paid people in our world today.
Does that means that it's ok not to seek an education?
Certainly NOT !
Although these people might be drop out of the education system in their country, however, the same group of people who are dropped out and still being able to be one of the top earnest in their countries definitely deserve our attentions, what are the ways and means and how did they do it ?
They are being taught something which were not put in our school syllabus.
Well, some of us might call that "CCA".
PR-ing.
Fair, fair.
There's still something else called the financial literacy.
And personally i believe that's what differentiate the rich and the wealthy, and creating the gap in between and rich/wealthy and the poor&middle income.
The rest is for you guys to find out.
Stay Tuned !
Sunday, March 14, 2010
Being Rich OR financially Independent
Being Rich and Being financially independent are totally 2 different things.
Th
ere are 4 kinds of people in this world.
1. Poor & Financially Dependent.
2. Poor & financially independent although this is uncommon, theoretically it can be done.
3. Rich & financially dependent, this is most common in our society today.
4. Rich & financially Independent.
Which category do you belongs to ?
Example 1: A senior manager in a certain company drawing a monthly salary of $20,000 a month.
Is that consider rich ? Err.. maybe quite well to do, and to some people maybe quite rich but not exactly very rich, but still can afford a nice European car with a nice Condo. Financially independent? not quite, when they bad market hits, he might lose his job. You must be thinking, "when they bad market comes, everybody is affected" I agree to a certain extent. You see a high post manager in a big company usually still have a fixed working hour, example, 830-6? And as his position and influence in the company grows, his income increase, so is his responsiblities.
So is he consider quite rich? YES.
Financial Independence? NO.
Example 2: A business owner owns a few seafood restaurants in singapore. He have 100 manpower working for him with his team of supports running the business for him. Every year he earns about $400,000 dollars on average, factoring in good times and bad times.
No doubt in the first few years there's abit of risks and he work very hard, but once his businesses start rolling and generating income for him, he doesn't have to work that hard anymore, but he still needs to supervise the progress, however he can choose to spend more time with his family and going on a holiday when he chose to.
So is he consider quite rich? YES
Financial independence? YES
The main differences between the 2 fictional characters which i highlight is very obvious.
One work very hard for money and is still doing so.
The other work very hard for money and after he has the money, he made the money work for him instead.
You can be a General Manager of a huge company and drawing a salary of $500,000 a year.
But I can be a small business owner and my business generate $300,000 for me a year.
Financially, you're richer than me, but my income will not have a huge impact regardless i work for 3 months a year or 6 months a year. However, if you were to work only 3 or 6 months a year, i think you will lose your job.
When i talk about business, i mean business with a sustainable business model and is able to make money regardless of your existence.
I've read a book before and it talks about 4 kind of people who are able to achieve financial independent,
1. Entrepeneurs
2. Investors
3. Insurances/Property agents
4. Multilevel network marketing
However, I still believe there's a way to achieve that.
Some people would known it by the "8th Wonder of the world"
It's called the power of compound interests.
Remember your credit card interests? 2% a month ?
Let this idea of compounding interests work for you instead of working against you.
Instead of building up debts and let the banks compound your debts, instead put your money in a medium that is able to compound interests for you, months after months and years after years.
Let your money work harder for you instead !
Although you can be rich & be financially independent at the same time.
Th
ere are 4 kinds of people in this world.1. Poor & Financially Dependent.
2. Poor & financially independent although this is uncommon, theoretically it can be done.
3. Rich & financially dependent, this is most common in our society today.
4. Rich & financially Independent.
Which category do you belongs to ?
Example 1: A senior manager in a certain company drawing a monthly salary of $20,000 a month.
Is that consider rich ? Err.. maybe quite well to do, and to some people maybe quite rich but not exactly very rich, but still can afford a nice European car with a nice Condo. Financially independent? not quite, when they bad market hits, he might lose his job. You must be thinking, "when they bad market comes, everybody is affected" I agree to a certain extent. You see a high post manager in a big company usually still have a fixed working hour, example, 830-6? And as his position and influence in the company grows, his income increase, so is his responsiblities.
So is he consider quite rich? YES.
Financial Independence? NO.
Example 2: A business owner owns a few seafood restaurants in singapore. He have 100 manpower working for him with his team of supports running the business for him. Every year he earns about $400,000 dollars on average, factoring in good times and bad times.
No doubt in the first few years there's abit of risks and he work very hard, but once his businesses start rolling and generating income for him, he doesn't have to work that hard anymore, but he still needs to supervise the progress, however he can choose to spend more time with his family and going on a holiday when he chose to.
So is he consider quite rich? YES
Financial independence? YES
The main differences between the 2 fictional characters which i highlight is very obvious.
One work very hard for money and is still doing so.
The other work very hard for money and after he has the money, he made the money work for him instead.
You can be a General Manager of a huge company and drawing a salary of $500,000 a year.
But I can be a small business owner and my business generate $300,000 for me a year.
Financially, you're richer than me, but my income will not have a huge impact regardless i work for 3 months a year or 6 months a year. However, if you were to work only 3 or 6 months a year, i think you will lose your job.
When i talk about business, i mean business with a sustainable business model and is able to make money regardless of your existence.
I've read a book before and it talks about 4 kind of people who are able to achieve financial independent,
1. Entrepeneurs
2. Investors
3. Insurances/Property agents
4. Multilevel network marketing
However, I still believe there's a way to achieve that.
Some people would known it by the "8th Wonder of the world"
It's called the power of compound interests.
Remember your credit card interests? 2% a month ?
Let this idea of compounding interests work for you instead of working against you.
Instead of building up debts and let the banks compound your debts, instead put your money in a medium that is able to compound interests for you, months after months and years after years.
Let your money work harder for you instead !
Tuesday, March 9, 2010
Steve Jobs, who once was diagnosed with pancreatic cancer, on following your heart
No one wants to die. Even people who want to go to heaven don't want to die to get there.
And yet death is the destination we all share.
No one has ever escaped it. And that is as it should be, because Death is very likely the single best invention of Life.
It is Life's change agent. It clears out the old to make way for the new. Right now the new is you, but someday not too long from now, you will gradually become the old and be cleared away.
Sorry to be so dramatic, but it is quite true.Your time is limited, so don't waste it living someone else's life.
Don't be trapped by dogma — which is living with the results of other people's thinking.
Don't let the noise of others' opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.
Taken from www.NextInsight.net
Sunday, March 7, 2010
The Agony of Planning.
Recently, I've got in touch with some articles and statistics on planning.
The numbers here are not perfectly accurate but it's close to actual stats.
Lets take 100 young people at the age of 25 years old.
In 40 years time, when they are 65, 11 of them would be dead.
I mean dead, die la, accidents, illnesses and suicide and whatever you could think of, just dead.
13 of them would be dead as well, dead broke.
The numbers here are not perfectly accurate but it's close to actual stats.
Lets take 100 young people at the age of 25 years old.
In 40 years time, when they are 65, 11 of them would be dead.
I mean dead, die la, accidents, illnesses and suicide and whatever you could think of, just dead.
13 of them would be dead as well, dead broke.
About 66 people, would be able to have enough to just get by, not very rich, with a little bit of savings enough to get through everyday until they meet God.
10 people, and only 10 would be somewhat financially independent.
Any ideas why is that so?
Drumrolls please.
*Drumrolls*
It is because,
People doesn't planned to fail.
They just failed to plan.
There are 2 kinds of people in this world,
First, we have the Spend first, save later if have any, not enough, we still have credit card.
Second kind of people belongs to the Save first, Spend later.
Actually, close to 90% of the people belongs to the Spend first and Save later(taking away the not enough and credit card part).
And actually, the 90% of the people who spend first and save later and bringing into the our topic today those not enough still got credit card people, we are actually working for the
minority, 10% who save first and spend later indirectly, thus, helping them to achieve financial independence.
In an ideal world, with an ideal salary and situation, everyone of us(i hope), would want to save first and spend later, am i right ?
But this world was not ideal, and is not yet ideal.
So there won't be an ideal time for you to save first and spend later.
However, you can make a choice today to make your life ideal today by saving first and spending later. So, when do we start?
Tomorrow? or next year?
Well i doubt the world gonna be ideal then, but then again, the ideal time for you to start saving first and spending the rest, is NOW!
You guys know i'm a life planner right?
So basically, I does planning for a living.
Theoretically, I sell financial products for a living,
But i doesn't agree with that, i does planning for a living.
Let me explain myself abit, i does not help you with which month is an ideal month for a new child to be born or should i get a 1.6 or 2.0 car.
These things you guys will go to the internet and library to check it out and plan for youself.
I does the kind of planning where people doesn't plan for themselves,
example, retirement, they take it for granted that they will have enough funds in CPF to retire.
Or planning for unexpected events, it's like I've got a crystal ball right in front of me.
Or example love gifts, which i mentioned in my previous post.
I does the kind of planning which people refused to do for themselves/doesn't know how to do/don't bother to do/or never thought of doing kind of planning.
So let us work hand in hand today, to plan for the kind of things which normally you won't do for yourself. Good night.
Sunday, February 28, 2010
Love Gift
Christmas, chinese new year.
There's a spirit of giving and receiving in the air.
Especially for the unmarried.
Chinese new year is a time of an increased income for the month, not alot but still a few hundreds, well, i've heard of people ang bao coming in thousands of dollars, minorities, but still makes people jealous.
We give to somebody, because we like/love them.
Giving with an expectations of receiving something in returns, giving because we are obligated to.
Obligated to but you can still give out of joy.
Christmas, giving to friends, family members and even colleagues.
Chinese new year, giving to the younger generations regardless you're close to them or not.
In our chinese traditional, as long as it's CNY, and you're married, you're "obligated" to give to those who are not married regardless of how old they are, even though my mum is married for 20 over years, she still received an ang bao from her mum which is my grandma, giving out of love and joy.
But what are you preparing for your loved ones when one day, should you be taken out of this world?
Regardless it's by chance or by plans, it will come to you for no men escape death.
What are you preparing for your loved ones ?
I've heard a saying that since we're young and not yet married, we does not have so much liabilities so therefore we don't need so much death coverage, theoretically, you're right.
But there's much more in life then just your liabilities, it's a love gift you prepared for your loved ones beforehand, something which given a choice, we don't wish to talk about, but no men escape death.
This is a gift, a most selfless gift a man can give to his loved ones, when given, really, nothing in returns. But this gift shows your love, even when you leave this world, the love endures.
So other than your coverage just covering your liabilities, how much more do you want to love the people around you, how much more do we need to prepare for them, for when we are around, we tried our best to give them all that we have, what about when we're gone?
Today, we shall start planning this love gifts that last throughout generations.
From your parents, the same love gift can be shared with your spouses, children and even, people whom doesn't even know your name but whom you wish to do something for them, let this love endures.
There's a spirit of giving and receiving in the air.
Especially for the unmarried.
Chinese new year is a time of an increased income for the month, not alot but still a few hundreds, well, i've heard of people ang bao coming in thousands of dollars, minorities, but still makes people jealous.
We give to somebody, because we like/love them.
Giving with an expectations of receiving something in returns, giving because we are obligated to.
Obligated to but you can still give out of joy.
Christmas, giving to friends, family members and even colleagues.
Chinese new year, giving to the younger generations regardless you're close to them or not.
In our chinese traditional, as long as it's CNY, and you're married, you're "obligated" to give to those who are not married regardless of how old they are, even though my mum is married for 20 over years, she still received an ang bao from her mum which is my grandma, giving out of love and joy.
But what are you preparing for your loved ones when one day, should you be taken out of this world?
Regardless it's by chance or by plans, it will come to you for no men escape death.
What are you preparing for your loved ones ?
I've heard a saying that since we're young and not yet married, we does not have so much liabilities so therefore we don't need so much death coverage, theoretically, you're right.
But there's much more in life then just your liabilities, it's a love gift you prepared for your loved ones beforehand, something which given a choice, we don't wish to talk about, but no men escape death.
This is a gift, a most selfless gift a man can give to his loved ones, when given, really, nothing in returns. But this gift shows your love, even when you leave this world, the love endures.
So other than your coverage just covering your liabilities, how much more do you want to love the people around you, how much more do we need to prepare for them, for when we are around, we tried our best to give them all that we have, what about when we're gone?
Today, we shall start planning this love gifts that last throughout generations.
From your parents, the same love gift can be shared with your spouses, children and even, people whom doesn't even know your name but whom you wish to do something for them, let this love endures.
Wednesday, February 17, 2010
It's Chinese New Year
Ang Baos, food, beer, gathering and not forgetting gambling.
GAMBLING?!
I'm sure at least half of you gamble during chinese new year.
It's fun and exciting.
But really, is it for leisure, for excitment or for fast cash ?
Is it an entertainment or an addiction?
Is it a blessing that we have this culture to gamble during chinese new year or is it a curse ?
Anything taken in excess isn't good, i'm not encouraging leisure gamble although i does that once every year. But just like medication, overdosing on drugs becomes a curse, but when it was first created, it's for the benefits of mankind.
abnormal use of something becomes ABUSE.
With casino accessible to us, i believe it's meant for tourists attraction to generate more revenues for us, and a form of leisure for singaporeans.
Leisure means you do it during your free time within your means, not making it your way of life.
But i read a news on yahoo news, source from channel news asia,
"Indonesian who lost all in casino at Resorts World Sentosa, stole at airport" Feb 18, Thursday 2010.
Back to the question, is it gambling or is it character flaws?
Any sociology students here?
What's the underlying cause?
money? fast cash?
so can we summarized, the love of money causes all these.
Money is unbiased.
It is neither good nor evil.
So actually, the problem is not with gambling or with casino, the problem lies with the love of money? Even if there's no such things as gambling or casino, it just means that there will be an increase of other forms of medium for these people to gather more money without working?
With all repsect and love, i do not have anything against these gambling addicts personally, not that i condone their actions, but it's just not right to condemn them just because they are addicted to gambling, cause the root problem i believe is they are taught to love the wrong things.
As i have mentioned, it's not how much money you have, is what your money can do for you and how it can adds value in your life and those around you.
GAMBLING?!
I'm sure at least half of you gamble during chinese new year.
It's fun and exciting.
But really, is it for leisure, for excitment or for fast cash ?
Is it an entertainment or an addiction?
Is it a blessing that we have this culture to gamble during chinese new year or is it a curse ?
Anything taken in excess isn't good, i'm not encouraging leisure gamble although i does that once every year. But just like medication, overdosing on drugs becomes a curse, but when it was first created, it's for the benefits of mankind.
abnormal use of something becomes ABUSE.
With casino accessible to us, i believe it's meant for tourists attraction to generate more revenues for us, and a form of leisure for singaporeans.
Leisure means you do it during your free time within your means, not making it your way of life.
But i read a news on yahoo news, source from channel news asia,
"Indonesian who lost all in casino at Resorts World Sentosa, stole at airport" Feb 18, Thursday 2010.
Back to the question, is it gambling or is it character flaws?
Any sociology students here?
What's the underlying cause?
money? fast cash?
so can we summarized, the love of money causes all these.
Money is unbiased.
It is neither good nor evil.
So actually, the problem is not with gambling or with casino, the problem lies with the love of money? Even if there's no such things as gambling or casino, it just means that there will be an increase of other forms of medium for these people to gather more money without working?
With all repsect and love, i do not have anything against these gambling addicts personally, not that i condone their actions, but it's just not right to condemn them just because they are addicted to gambling, cause the root problem i believe is they are taught to love the wrong things.
As i have mentioned, it's not how much money you have, is what your money can do for you and how it can adds value in your life and those around you.
Thursday, February 4, 2010
My first valuable lesson on $money$
When i was a little boy, my parents taught me one of my most valuable life lessons.
The lesson of saving, a penny save is a penny earned.
It's not being taught in the classroom, it's being taught in my living room.
Well. some of you might says,"no, with inflation rate like that, it should be a penny invested is a penny well spent."
Well my parents belong to the more traditional generations.
I will received a pocket allowance of 80cents a day in primary school, yr1-3.
and everyday when i came home from school, i will put 10-20cents inside a metal container in my wardrobe.
And into my teenage years, my dad taught me another lesson.
That those money in my savings doesn't have an expiry date.
I can take my time to spend it.
And when i'm joined the financial industry, I've learnt yet another valuable life lesson.
There's power in budgeting.
" A budget is telling your money where to go instead of wondering where it went." C.E. Hoover
Personal budgeting is just another word for cash flow management.
If you really do your cashflow management diligently and properly, you will realised that it helps you to eliminate or decrease unnecessary expenses.
AND at the same time, you will unknowingly put your money into better use.
Doing a proper cashflow chart will:
1. Help you to understand your spending pattern.
2. and with the same chart, you will be able to allocate your funds more wisely.
with these 2 points in mind, you will have a better idea how to overcome excessive spendings!
I've done up my own cashflow chart and would like to share it with you guys.
Budgeting is estimating your income and expenses & setting realistic goals.
1. Priortising Your Goals
2. A penny save is a penny earned, pay yourself a salary 1st before your expenses.
3. Using your bank account as a platform, Savings & Current.
4. Make sure you've provision for the worst, since it's the worst, that's when credit cards can help as a temporary solution. But a better solution would be don't spread your finances too thinly.
5. Review your cashflow monthly.
6. Comparing targeted spendings with actual targets and improve on them.
With these points, I do hope i've empowered you and set you on your way to financial success.
Credit Card as a weapon ?
Credit Card is a double edged sword we are using in our capitalistic world today.
It allows you to buy now and pay later.
"HUH? what you talking"
what i mean is, exchanging future income for today's enjoyment, oops, i mean necessities.
I often joked," Wah you got 4 credit cards! that puts you into the top 10% earners in singapore because you would have access to $20,000 funds a month!"
The truth is that Credit gives you an immediate purchasing power even beyond your means but it doesn't increase your income.
Credit card is like the 2nd best thing that a human mind had ever invented, 1st being life insurance of course.
A person who understand the pros and cons of it often get the most out of it, but the same truth apply to people who doesn't understand credit.
It's that, it will get the most out of you.
There's a quote by THE JOYCE BROTHERS "Credit buying is much like being drunk. The buzz happens immediately gives you a lift... The hangover comes the day after."
The danger zone:
1. what girls call "shopping therapy" i mean for those who spend out of their means to service the bills.
2. Buying with minimum down payment, i heard some boos, some people say what about the opportunity cost involves? Ya I'm talking about minimum or even zero down payment.
That is provided the "opportunity" which you are talking about can hedge against the credit interests and make you some money.
3. Cash advances? heard of that, means when your bank no money, you can take your credit card and withdraw cash. check out the interests rate man !
4. Borrowing money, im not talking about emergencies.
5. Using your emergency funds to pay for daily expenses.
6. when you hit your credit limits. That's a classic.
However, with proper financial planning, you can avoid such agonies.
*Financial planning doesnt mean buying life plans, endowment or hospital plan although this might be part of it. Some people hear the word financial planning, "what you want to sell me ?"
1. Learn to pay your bills by charging to your debit card/NETS IT! But nowadays, different cards got different benefits and discounts at different places! so tempting. so make sure you don't choke up bad debts.
2. Spend your money wisely according to your cashflow plan.
3. Reduce your debts as soon as possible.
4. Do not borrow or take loans to pay off existing loans/debts. work harder instead.
5. Set aside a sum of money every month when you received your pay check on top of your existing liabilities, insurances, monthly savings and emergency funds.
I hope it helps !
It allows you to buy now and pay later.
"HUH? what you talking"
what i mean is, exchanging future income for today's enjoyment, oops, i mean necessities.
I often joked," Wah you got 4 credit cards! that puts you into the top 10% earners in singapore because you would have access to $20,000 funds a month!"
The truth is that Credit gives you an immediate purchasing power even beyond your means but it doesn't increase your income.
Credit card is like the 2nd best thing that a human mind had ever invented, 1st being life insurance of course.
A person who understand the pros and cons of it often get the most out of it, but the same truth apply to people who doesn't understand credit.
It's that, it will get the most out of you.
There's a quote by THE JOYCE BROTHERS "Credit buying is much like being drunk. The buzz happens immediately gives you a lift... The hangover comes the day after."
The danger zone:
1. what girls call "shopping therapy" i mean for those who spend out of their means to service the bills.
2. Buying with minimum down payment, i heard some boos, some people say what about the opportunity cost involves? Ya I'm talking about minimum or even zero down payment.
That is provided the "opportunity" which you are talking about can hedge against the credit interests and make you some money.
3. Cash advances? heard of that, means when your bank no money, you can take your credit card and withdraw cash. check out the interests rate man !
4. Borrowing money, im not talking about emergencies.
5. Using your emergency funds to pay for daily expenses.
6. when you hit your credit limits. That's a classic.
However, with proper financial planning, you can avoid such agonies.
*Financial planning doesnt mean buying life plans, endowment or hospital plan although this might be part of it. Some people hear the word financial planning, "what you want to sell me ?"
1. Learn to pay your bills by charging to your debit card/NETS IT! But nowadays, different cards got different benefits and discounts at different places! so tempting. so make sure you don't choke up bad debts.
2. Spend your money wisely according to your cashflow plan.
3. Reduce your debts as soon as possible.
4. Do not borrow or take loans to pay off existing loans/debts. work harder instead.
5. Set aside a sum of money every month when you received your pay check on top of your existing liabilities, insurances, monthly savings and emergency funds.
I hope it helps !
Wednesday, February 3, 2010
History on the concept: Insurance
The idea of transferring and distributing risk were practiced by the Chinese(yay!) and Babylonia traders as long ago as the 3rd and 2nd millennia BC.
The merchants when received a loan to fund a shipment, they would pay the lender additional fee in xchange to cancel the loan should the goods gone missing due to a certain circumstances.
So i would say that "GENERAL INSURANCE" was started first as compared to "LIFE INSURANCE".
But It's the Achaemenian monarchs who started something more practical to human life. But they don't pay premiums as what we did today, they pay with "gifts". So whenever the "gifter" was in trouble or his children wants to get married, the monarchs will help him.
However, the greeks and romans introduce "health & life insurances"
They got a guild called, benevolent societies, who cares for the families of the deceased as well as paying for their funerals. So let us not forget the basis in which why life insurance was started.
Insurance contract was first introduced in GENOA, and insurances pools was backed by pledges of landed estate.
The concept of health insurance was made available in 1694 by the efforts of Hugh the Elder Chamberlen from Peter Chamberlen family.
And from then on, insurances take on a whole new identity in the world as the manufacturers give it a new "facelift" every now and then. In our today's world, Insurance companies are the supporting pillar of every well to do society. It provides welfare benefits and it pays them when they need the money most.
The healthcare industry can only reached their fullest potential, provided first, insurance company in that country is doing well, when medical inflation rising at an alarming rate of 4-5% a year in singapore, how many of us, actually have that kind of funds available to seek the best medical treatment?
but in singapore at least, insurance was deem as a "dirty" word,
so why not called it "Indemnification".
High class word for insurance.
The merchants when received a loan to fund a shipment, they would pay the lender additional fee in xchange to cancel the loan should the goods gone missing due to a certain circumstances.
So i would say that "GENERAL INSURANCE" was started first as compared to "LIFE INSURANCE".
But It's the Achaemenian monarchs who started something more practical to human life. But they don't pay premiums as what we did today, they pay with "gifts". So whenever the "gifter" was in trouble or his children wants to get married, the monarchs will help him.
However, the greeks and romans introduce "health & life insurances"
They got a guild called, benevolent societies, who cares for the families of the deceased as well as paying for their funerals. So let us not forget the basis in which why life insurance was started.
Insurance contract was first introduced in GENOA, and insurances pools was backed by pledges of landed estate.
The concept of health insurance was made available in 1694 by the efforts of Hugh the Elder Chamberlen from Peter Chamberlen family.
And from then on, insurances take on a whole new identity in the world as the manufacturers give it a new "facelift" every now and then. In our today's world, Insurance companies are the supporting pillar of every well to do society. It provides welfare benefits and it pays them when they need the money most.
The healthcare industry can only reached their fullest potential, provided first, insurance company in that country is doing well, when medical inflation rising at an alarming rate of 4-5% a year in singapore, how many of us, actually have that kind of funds available to seek the best medical treatment?
but in singapore at least, insurance was deem as a "dirty" word,
so why not called it "Indemnification".
High class word for insurance.
Tuesday, February 2, 2010
Zac on MC
As most employees do,
some of us have 14 days of MC, some are more fortunate, 21days a year.
Some are always sick till the extent they clear their MC every year.
Therefore it's important for us to have a good medical coverage, even as we are working, but it's even more important when we stop working !
The best part is that a medical coverage for most of us would come at a cost, at a cost of no cash involved because in singapore, a shieldplan is payable via our medisave account.
Most insurance company in market today are providing up to half a million or more coverage per year per person.
that means, every year when/if you are hospitalized, you would have access to half a mil or more to pay for your bills.
Great news ! please do sign up!
however as it's a term plan and premiums are adjusted higher at a certain age band, people are worried that they won't have money in their medisave account if they keep paying for their premium. But the main purpose of a medisave account is to pay for your medical expenses.
tell me people, how long will you need to take to acculumate half a million or more in your medisave account?
when right now, a premium which you know the amount can be xchange for half a million of coverage !
but bodies made of steel(still) are not encourage to purchase, cause it won't be of any benefits to them !
some of us have 14 days of MC, some are more fortunate, 21days a year.
Some are always sick till the extent they clear their MC every year.
Therefore it's important for us to have a good medical coverage, even as we are working, but it's even more important when we stop working !
The best part is that a medical coverage for most of us would come at a cost, at a cost of no cash involved because in singapore, a shieldplan is payable via our medisave account.
Most insurance company in market today are providing up to half a million or more coverage per year per person.
that means, every year when/if you are hospitalized, you would have access to half a mil or more to pay for your bills.
Great news ! please do sign up!
however as it's a term plan and premiums are adjusted higher at a certain age band, people are worried that they won't have money in their medisave account if they keep paying for their premium. But the main purpose of a medisave account is to pay for your medical expenses.
tell me people, how long will you need to take to acculumate half a million or more in your medisave account?
when right now, a premium which you know the amount can be xchange for half a million of coverage !
but bodies made of steel(still) are not encourage to purchase, cause it won't be of any benefits to them !
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