JackNeo’s “Money No Enough 2″ (钱不够用 II) is out in the cinemas and I managed to catch it during one of the days. I had watched the original “Money No Enough” which was Jack Neo’s debut film back in 1998 but can’t recall much the plot even though Wikipedia has an entry on it.

“Money No Enough 2″ is not a sequel to the original film as the storyline is totally diffferent. I will be sharing some of the personal finance lessons the film conveys and there will be some plot spoilers. Stop here if you have not watched the film.

SPOILERS AHEAD. STOP READING IF YOU HAVE NOT WATCHED THE FILM.

Personal Finance Lessons from Money No Enough 2

1. High Risks vs High Returns

The way the 2nd and third brothers are portrayed as sharp businessmen making their money through multi-level marketing (MLM) while the other is doing enbloc deals had a statement to make, i.e. you can be financially free from taking high risks but get potentially high returns. Of course, when the fates of the brothers go south because the MLM Pollen product of the third brother causes some health problems for its consumers while the failure of the enbloc deal coupled with loss of property transaction monies by the 2nd brother causes them to go near bankruptcy.

“Money Not Enough 2″ Nugget

Money can be made but it can be lost just as easily through high risk ventures. Be careful when investing and especially when borrowing money from loan sharks to fund investment ventures.

2. Private Medical Costs are Going Up

In the film, the brothers find that they have to ward their mother after she collapses after discovering that she was being sent to a old folks’ home. They baulk at the $8,000 per day ICU ward costs at a private hospital and even burn some incense paper to hasten their mother’s departure to the next world.

“Money Not Enough 2″ Nugget

We know health care costs are increasing at the scene where the sons break down when burning the incense paper was a touching moment. It connected with me because this is a real scenario for us in that if we faced an aged parent who was lingering on life support in ICU. Would our medisave and money run out before the aged parent passes away?

3. Buying 4D Helps Solve Some Financial Problems

The brothers are shown in the end to strike lottery on their mother’s funeral hearse vehicle number 8888. This helps them recoup some of the costs of their mother’s medical costs which ballooned to $250,000.

“Money Not Enough 2″ Nugget

Where all things fail, there is still the lottery!

4. Relationships and Not money is True Wealth

The brothers finally realise that when the chips are down, the eldest brother with his family, while poor are the happiest and the previously more successful brothers. In addition, the brother go through their riches-to-rags-to-riches tale within the 126 minutes of the film showing that at the end of the day, caring for each other and pulling through together as a family is what is true happiness and wealth.

“Money Not Enough 2″ Nugget

Put family first before money.

Panzer’s Overall Comments about the film

The film starts awkwardly and its direction is not clear initially. Does it set up to be a anti-establishment rant about the efficacy of government taxation and collection of fees and charges or is it about sharing the stories of 3 families linked to each other in financial fortunates through the declining health and sanity of their mother?

Money Not Enough 2 starts slowly but ends on an emotionally strong note. I would think if the front part had been snipped off for the first 10 minutes, the film’s cohesive story line relating to the three families would still be a powerful message about family, money and life. Jack Neo’s obvious use of product placement of banks and air-conditioners makes one cringe because they are far from subtle and very “in your face”. That is the price of making a film more commercially viable?

All said, the story is still enjoyable and given the lack of films where you can hear hokkien dialogue, it is worth your money to consider watching it for all the local references that we Singaporean residents can identify with.

Be well and prosper.

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Image via Wikipedia

I asked the following question to personal finance bloggers and will be featuring their take on:

What is the single most important lesson you learnt in personal finance?

The journey towards financial freedom has allowed me to meet online many like-minded individuals who share the same passion and interest as I have towards achieving financial freedom. I realise that to be successful in achieving your goal towards financial freedom, you have to have some support. This support comes from knowing that the steps you take towards financial freedom such as living within your means, being frugal, saving and investing and deferring today’s wants for tomorrow’s needs result in you being DIFFERENT from your colleague, neighbour or friend. People will laugh at you saying why are you so frugal? You could kick the bucket anytime and not enjoy your money. Others will be envious of your financial stability and want you to be LIKE THEM in spending like there’s no tomorrow and then later outlive their retirement funds.

I encourage you to be DIFFERENT but reading what other people who believe in living like no-one else think is the single most important lesson they have learnt in personal finance.

1. La Papillion (Blog: Bully The Bear)

I think out of so many things I read and learnt from others, I can single out the most important component - savings. Savings is such a critical first step towards building wealth and towards the nirvana state of attaining financial independence.

With savings, one needs to settle one crucial equation : Income = Savings + expenditure. To save more, there is just two ways to do it - increase one’s income and/or decrease one’s expenditure. It can be done simultaneously or one at a time, depending on what kind of jobs one holds. I’m single, with no family, so I have a rather healthy saving rates of 70-80% of income. I intend to save at least 50% of income even after I have a family. If I don’t, that means I’m not earning enough!

With healthy savings, then we can start to seriously grow wealth by all the available instruments - stocks, unit trust, property rental etc. For anyone who starts out, I dare say this is the single most important lesson to learn - curb your expenses and start paying yourself first. Once a disciplined saving mentality is built in, the cogs of one’s wealth building machine can start turning to generate more wealth for one.

2. Drizzt (Blog: Investment Moats)

The most important personal finance lesson i ever learn was to pay oneself first. if you pay one self first. if you are able to pay yourself a portion of disposable income, u can build up a sizable spending buffer, retirement savings account or general savings account in general.

I find that learning that enables me to spend more freely after setting this aside as i know i have that portion taken care of to a certain extent.

3. Helmi Hakim (Blog: http://www.helmihakim.com/)

Managing your personal finance is the responsibility of every individual.

Be it, if you are a student, an employee, a business person, a full time investor, everyone, I meant all of us, has the inherent responsibility to manage our finance well.

The most important lesson, I learnt in personal finance, boils down to setting financial goals.

In my capacity as a financial associate in Singapore, I get to talk to lots of people, every single day.

I realise most of them have an insurance plan, have an endowment plan, have an investment linked policy, yet many do not set that OBJECTIVES for having those plans.

When asked, “Why do you get that endowment plan?”

Most will answer, “For savings purpose.”

When pressed for specific objectives, most will retort, “Don’t know. Just savings”.

You need to set your objectives right.

You need to set up your objectives clear.

A soccer player can’t score goals, if he does not know where his goal post is.

An athlete in the Olympics cannot win the game, if he is not clear on the perquisites to winning.

You get life insurance, for your coverage against death, permanent disability and 30 critical illnesses.

You save your money in the bank as a form of contingency funds for emergency use or for your everyday use.

You save your money in endowments, in investment linked products for child’s university education, for your retirement or simply to improve your living standards in the future.

The goal, the time frame and where you money is allocated to; everything is instrumental to your financial success.

Being clear of what exactly you want, and how much exactly you need, will help you in achieving your financial goals.

When setting financial goals, I always share with my clients this simple acronym, simple formula, which I termed as SMART.

Your goal must be Specific, Measurable, Attainable, Realistic and Timely.

Specific.

What is your OBJECTIVE of getting that savings plan?

How much money exactly, do you want to accumulate?

Measurable

Your goal must be measurable.

If your child is 8 years old, and 10 years later, she wants to go to a local university; do you have at least $84,000 for her 3 years university education?

Attainable

When you identify the goals that are important to you, you must find ways to make them come true.

Align yourself with professionals to ATTAIN your goals.

Align with people who already achieved the outcome you want, and learn from them.

Realistic

If you have been saving only $100 per month, to save $1000 per month in an endowment plan now, may seems farfetched.

Unrealistic.

Set yourself, a realistic goal.

Timely

When exactly do you need, the money that you has saved?

10 years? 15 years? 20 years?

You decide!

So, just remember, setting financial goals are important, and when you set those goals, make sure it is SMART financial goals.

Thank you.

4. Panzer (Blog: Fivecentstencents.com)

The single most important lesson is to know the difference between needs and wants. I realised that once you have managed to distinguish the two in theory and then implement it in practice, then you are well on your way towards being able to live within your means. The underlying reason why many of us take time to learn this lesson is that it is easier to distinguish between needs and wants in our heads than it is to do so when we open our wallets to buy things we don’t need and consume services that fulfil more of wants than needs.

Life doesn’t have to be lived only for needs but the ability to distinguish between them sows the seeds for financial freedom. Take drinking water for example. If you bring a water bottle to fulfil your need to quench your thirst and restrict buying soft-drinks or bottled water, you will find that you can fulfil your need to quench your thirst without paying so much money. Similar for a mobile phone. A very basic mobile phone vs a high-end one can mean a difference of a few hundred dollars. That is enough to buy groceries for quite a few meals for the family.

The ability to see a need and a want allows us then to determine where is the line we want to draw between spending and saving. Individual decisions made daily, weekly and monthly all add up, allowing you to save more than you thought possible.

Be well and prosper!

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It’s Friday again and Panzer feels like a zombie because he has not gotten uninterrupted sleep since his daughter still wakes up a few times a night for her feeds.

Let’s see what Panzer’s sleep-deprived mind has been reading to help him move towards financial freedom.

In these days of 7.5% inflation in Singapore and of inflationary pressures the world over, Get Rich Slowly shares what is happening in the US with “Hidden Price Increases at the Grocery Store“. They shrink the packaging and give you less value for your dollar. The incredible shrinking chicken rice sound familiar?

The Simple Dollar does a personal finance book review on “Good Debt, Bad Debt” by John Hanson. Reading personal finance books is one of the important ways to gain insights into personal finance. When you read in depth and widely, you get a good perspective on how people approach personal finance in their lives. He also shares about the single biggest money mistake he has ever made in his youth. What money mistakes have you made in your life? My own list makes me blush e.g. losing $x,xxx on realised losses on shares during subprime last year showing my “expertise” in stock picks.

Lazy Man and Money does a stock check on his personal net worth as well as other life goals for 2008. Do you set goals for yourself towards financial freedom, health and other aspects? Besides personal finance, I enjoy personal development or self-improvement books to basically learn more about being more effective as a person.

The Digerati Life shares “Basic Business Advice from an Accidental Entrepreneur” on her efforts in Silicon Valley. One of the things I learnt from reading personal finance bloggers is that they tend to be entrepreneurial in thinking. While many still have their day jobs, some have grown their blog monetisation efforts into full-time businesses. I aspire to a lifestyle where blogging is part of my life and provides me with the financial means to do some serious lifestyle design changes like what Tim Ferriss expounds in his book, “The Four Hour Workweek”.

Jeflin’s Investment Blog shares a rather sad tale of an American home owner killing herself because her home was about to be foreclosed by the bank. While committing suicide over financial issues is extreme, it highlights how important one’s home can be and if you do not have that roof over your head, life can seem hopeless and meaningless.

The Wise Bread asks a thought-provoking question, “Should Your Standard of Living Rise”? His article addresses one of the most fundamental tenets of personal finance - how to live within your means. In a growing economy, income levels can go up with commensurate increases in standard of living. In Singapore the upgrading frenzy fueled by rising property prices allowed many to live better while jobs were plentiful and the economy boomed. During the 1997 Asian crisis and even earlier during the 1985-86 recession, the economy stalled for and retrenchments and downgrading happened. I learnt valuable lessons during those periods and it has helped shaped why I push myself hard to live within my monthly paycheck by enjoying life without spending more to achieve it.

To wrap up, I leave you with Randy Pausch’s video on his last lecture. For those who do not know who Randy Pausch is, he is a computer science professor in Carnegie Mellon University and gave a inspiring lecture about “Really Achieving Your Childhood Dreams” after being diagnosed with terminal pancreatic cancer. He passed away at the age of 47 on 25 July 2008 leaving behind a wife and three children.

While his message is not related directly to personal finance, he reminds us to pursue our dreams and really life is about people and relationships. Achieving financial freedom allows us more time to touch more lives and to live more fulfilled relationships. When you’re scrambling to earn a living and feel pressurised by debts, mortgages and making a living, it’s hard to really live life.

Have a good weekend.

Be well and prosper.

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