We know in theory that health is truly wealth but how much do we practice it day in and day out?

I for one have been telling myself that I need to exercise and to lose weight. The irony is that the lack of exercise, coupled with a few late nights saw my body succumb to a bug that made me lose weight due to lack of appetite. I realise that I need to really sleep by 11pm on most days as I get up around 6.30 am for work from Mondays to Fridays. My health has been something that I neglected a bit as I indulged in more than my usual share of soft drinks, snacks and fried foods.

It took a toll and a 5 day course of medication made me re-examine how healthy (or unhealthy) my habits had been for the last month or so.

There’s no point in me rambling on and on about getting healthy if I don’t do anything. In terms of diet, I would focus on more soup based foods as they tend to be less oily and with lesser fried stuff. In terms of exercise, I am trying to get myself back into the groove of doing some light jogging at least 2 x a week and something more strenuous 1 x week. My stress level was high last week because my staff was resigning and another staff was on long MC. Fortunately, the one on long MC was able to come back to work today and now I only have to contend with a short period it takes for the replacement staff to replace my staff who is leaving by mid September 2010.

Ultimately, financial freedom still has to exist in the context of being healthy enough to enjoy it. No health means that even if you are financially free, your quality of life would be poor.

Life is about balancing one’s needs and wants and to be healthy and happy in relationships with people who matter.

The closer I get to 40, the closer I realise that this balance is something that one has to constantly work on to make it happen.

How do you achieve your own balance in life?

Be well and prosper.

What is staggering is the amount; but underlying this story is what can potentially happen to any of us when we take a gambling approach towards financial freedom.

I have been to the Resorts World Casino in Sentosa. It was an educational and interesting experience to see groups of people who come together with a common purpose to gamble with their money on the various games provided by the casino. While individual motivations differ, the activity is the same. Taking a bet on a random outcome and potentially gaining or losing money in the toss of a dice or roll of the roulette wheel.

Some feel that gambling is a vice. Others feel that it can be a harmless hobby if one plays within one’s limits and sees it as a leisure activity and not a money making opportunity.

I too have gambled on SGX. Punting on short-term movements in share prices of companies which I had little interest to understand and research. How different is that from gambling in a casino? I am also wagering my capital on the outcome of share prices in the future. The time horizon may be longer than the time it takes for the roulette wheel to finish spinning but the concept is similar especially if my mindset is that I don’t really understand the company and business much and am just watching for the volatility in share prices to buy lower and sell higher.

Ultimately, if one doesn’t really understand what we are getting into in terms of investments, then we are moving closer to a gambling mentality to investing rather than true investing.

The lesson from the $26million loss by the businessman is clear. Play within your means be it investment or gambling. Do not invest (gamble) on credit. And most important of all, know your limits and when to cut loss and walk away without destroying yourself and your own life savings recklessly.

Be well and prosper.

"Black Swan" by Nita W

I am constantly reminded about the unpredictability of life. Yesterday one of my colleagues injured herself getting down from the bus and was on a week’s medical leave due to a fracture in one of her bones. Another colleague informed me that she was tendering her resignation because she wanted to pursue full-time studies to get her qualification.

What does these seemingly unrelated and yet coincidental occurrences have to do with the picture above?

A World of Mini-Black Swans

After reading Nicholas Nassim Taleb’s books on “Fooled by Randomness” and “The Black Swan”, I realised that the human understanding of the predictability of life is grossly over-stated. We think we know more about the world than we actually do. In Taleb’s language, a black swan event is characterised by rarity, extreme impact and retrospective predictability.

It’s quite rare in my case for both my colleagues (and there are only three of us including myself in the team) – one having a serious fall through an innocuous activity of getting down the bus and the other resigning around the same time. The impact on the office could be big because if my injured colleague is on long-leave, by the time my other colleague is clearing her leave, I will have to man the fort alone until the new staff comes in which from experience lags a few weeks to a month after the staff has left the organisation.

This occurrence only serves to strengthen my belief that life is totally unpredictable and huge shocks can happen. My own life is filled with that as less than a month ago, I was facing a crisis in my own life, that of separation from my spouse. While we are for the time being reconciled, I cannot but feel that my own mini black swan is also lurking behind the corridors of time, and thus it is important that my life be measured by the experiences I have gone through rather than about the x or y dollars I have amassed while I live.

Being Prepared for A Totally Unpredictable World

The more I think about survivalism or TEOWAWKI scenarios, the more I realise we take for granted most things in life. Running water, a functioning state, security and health, career etc. Only when truly black swan events occur right in front of us and impacts us through the value of our homes, our equity (stocks and shares) portfolio or our own lives that we take stock about what we already enjoy and prepare ourselves for possible challenges ahead.

Being prepared means to have a scout’s mindset of always being ready. We cannot predict 100% of what happens in life and in the world but we can control ourselves in acquiring the useful skills and abilities that can see us through whatever comes.

I start to realise keeping healthy and fit is one way to make my body resilient and stronger to withstand the challenges of life. I start to realise cherishing the existing family relationships allow one to savour the sweetness of being in a family when it can be taken away. I also start to realise that I don’t want to live a life of regret and to start enjoying small luxuries within my means NOW before I reach a point when I am too old to enjoy them.

Even though my work staffing situation appears to be dire, it was fortunate that I have made some preparations. For instance, I got my staff to document her work and processes in electronic form to facilitate handover. I also am familiar with most of the things she is doing so can take over while she is away and before her replacement comes in. This is not because I had foresight or could predict this possibility but some months back my staff’s family member was very sick and she contemplated resigning to help take care of her family member. Fortunately, I managed to get her to rethink her decision and her family member’s condition improved enough that she managed to last another 9 months since that episode and she is leaving for other reasons.

In relation to my journey towards financial freedom, I am now still having 33% of my net worth in equities. I think the volatility in the market will continue with a tendency for a correction given that the economic fundamentals of our key markets, US, Europe and China not looking too rosy. The risk of deflation and double-dip recession in the US is very real and I cannot see how Singapore can be unaffected given our export oriented economy.

I have kept my cash and cash equivalents high as ammunition to fight the upcoming challenges that the global economy throws at me.  I sleep better knowing my cash position and am comfortable even if my equities go south as I am in a net asset position.

What mini black swans do you think about and how do you think you are managing it?

Share with Panzer.

Be well and prosper.

I came across Bodyrock TV on youtube and through surfing the net. The personal fitness lady who demonstrates the exercise routine has such a killer bod that I always feel my fats and love handles each time I watch one of her latest workouts. I used to be slightly unfit in JC, lost quite a lot of bodyfat during full-time NS times, went through periods of fitness and relative unfitness in my 20s to 30s before the birth of my daughter 2.5 years ago let me shed my weight from 69 kg to a more manageable 63 kg now. I aim to maintain my current weight by exercising more and to do more exercises like those in Bodyrock TV.

Why am I talking about health and fitness?

No amount of money and financial freedom can be enjoyed if you don’t have good health.

I realise that I’m still not investing enough of my time to exercise (at least three times a week for 30 mins each) even though I can do so after my daughter is asleep or before she wakes up. I can also do so during lunchtime so I have absolutely no excuses other than my own laziness and inertia!

I’m posting a link to the workout video above to continue to remind myself to EXERCISE REGULARLY and GET FIT!

How do you invest in your health?

Share with Panzer in the comments section.

Be well and prosper.

Resorts World in Sentosa, Singapore by Cloudywind

I was at the Resorts World Singapore Integrated Resort recently and stepped into the casino for the very first time. The occasion was my mother’s birthday and she was staying at Hard Rock Hotel for her birthday vacation with my father. My parents are social casino patrons who do visit Genting and those Casino Cruises on occasion given their status as retirees who have provided for their medical and living needs.

It was truly interesting to see that even on a weekday afternoon, there were enough patrons to keep many of the tables at RWS humming along. Pai Gow, Pontoon, Blackjack, Caribbean Stud Poker, Roulette and countless number of Jackpot machines lined rows by rows with neatly attired croupiers and supervisors greeted the visitor who came in there.

Why am I talking about the casino at Resorts World Singapore?

Epitome of Singapore Inc.

The integrated resorts (aka. casinos) encapsulate what is the essence of Singapore. MONEY. The casino is a place where despite the $100 levy, Singaporeans and PRs queue up to throw money at the gaming facilities. It is a place where fortunes can be made or lost in a few short seconds, minutes or hours. It symbolises really that with MONEY, anything is almost possible.

In our quest for financial freedom, we tend to be focussed on MONEY. To have enough of investible savings that yields an income sufficient for our living expenses. To live within our means to generate savings. To use that savings to grow our investments. To grow our investments so that they yield returns even when we are sleeping. Financial freedom is why you read my blog and many others to learn more about the principles.

I walked by tables when the roulette wheel stopped spinning and stopped on the winning coloured number, majority of the punters had their chips systematically “washed” away by the croupier into the hole in the table. Before I understood the concept of financial freedom and embarked on this journey towards attaining financial freedom. My investments were closer to gambling bets in a casino than well thought-out moves to maximise returns at acceptable risks.

Thin Line Between Investing and Gambling

The fine line between gambling and investment is thin. What separates one from taking a gambling mentality versus an investing mentality is effort and understanding ourselves and what to invest in. Investing requires patience, hardwork to read about the companies we want to invest in for equities and about the risk-returns of other financial instruments. Gambling on the other hand, like putting money on a roulette table, requires one to only have  a very basic understanding of the rules of the game and then to put a wager on it. Gamblers put their entire capital at risk for quick returns. In the long-run the house always wins because of its larger capital and that the odds between payouts and outcomes of the casino games are weighed to benefit the house.

I realise that I used to have a gambling mentality in my quick punts on the stock market. I have since moved away from this approach and realise if I want to really gamble, the Marina Bay Sands resort and Resorts World Singapore are available for an entrance fee of $100. Better for me to take $300-500 as “play” money and have an entertaining time at the casino than see a couple of lots stuck in a blue-chip bought at inflated prices to make a return when I’m just gambling using a different vehicle and risking more of my capital.

Thus, I’m quite comfortable with my current investible savings allocation at 33% equities and remainder in cash and cash equivalents. Because I know I won’t be able to “get rich” overnight and be financially free simply by using the equity market alone. I need to continue to build up useful skills to help me generate more cash flows and to be prudent in my lifestyle. That has made me less of  a market watcher whose moods are affected by the swings of the Dow or STI.

Life is a Big Roulette Wheel Spin

Life is very unpredictable. We cannot control exactly what happens to us in life but we can control how we feel and react to it. I realise that even as the sands of time run out slowly like an hourglass, I need to conserve my life energy and channel it into meaningful pursuits. My career, family and personal growth are three key areas for me to focus. I know that many things inside my career, family and personal growth are affected by external factors; but I also know that I can concentrate my focus on things that matter to me in these three areas and work hard at them.

That is how I overcome the unpredictability of the world, to concentrate on what I can control and work on them.

In my quest for financial freedom, I can control my expenditure (to some extent) and to be open to new paradigms of either living a fulfilled life that is less dependent on material well being to growing my means to allow me to trade money for more of life’s experiences.

How do you cope with the unpredictability of life when it comes to affecting your plans towards financial freedom.

What are your thoughts if you have visited any of the Casinos in Singapore?

Share with Panzer in the comments section.

Be well and prosper.

Tweak. by digitalpimp

MM Lee’s comments about retirement has highlighted about the changing paradigm of retirement, in that it is increasingly becoming less of an automatic ritual upon reaching a pre-defined age and more of a lifestyle choice.

Traditionally, retirement is an age where one is able to stop working, collect a pension and to take time to smell the roses and to take care of grandchildren. My parents count themselves fortunate in that they were school teachers their entire careers and stayed in the pension scheme (and taking pay cuts in the last few years of their working life) even as it was slowly phased out by the CPF scheme.

However, the Civil Service has all but abolished the pension scheme except for a few select schemes e.g. Administrative service and some specialised services. Majority of public sector and statutory board employees are on the CPF scheme, as are virtually all the private sector and GLC or TLC organisations.

Thus, the concept of choosing not to work becomes one of income versus lifestyle needs than an age per se.

Retirement in the age of CPF

On paper, everyone can choose to retire i.e. to stop working if one has enough money to last them the rest of their lives. In theory you can, but in practice, it’s quite challenging because there are too many variables involved.

First of all, we cannot know for certain our life expectancies and health status over time and thus how much we need for lifestyle expenses and medical expenses. Secondly, CPF may not be enough for many of us have most of our ordinary account monies locked up in our homes and the remainder special account monies are not sufficient for minimum sum.

How then, can we choose to stop working if money is not enough?

Working till death

Not to sound morbid but I intend to work until the day I die. The catch is how I would define “work”. I intend to continue in my career as an auditor as long as I can to accumulate the savings that brings me closer to the target for financial freedom. But there would likely come a time where I would hit the “mandatory” retirement age and get hit with a pay-cut coupled with re-employment on a year-to-year basis. This may or may not be what I will enjoy doing when I’m at that age (probably 67 by the time I hit that age).

I don’t see myself doing the same old thing at that age. Instead, I choose to build possible paths so that when I’m close to “retirement age”, I will have alternative sources of income and a plan to live in a lower cost country other than Singapore. My post on retiring in Thailand talks about some of the considerations of such a plan.

MM Lee’s observations about keeping active resonate with me in that our minds and bodies are such that if you don’t use it, you will lose it. Hence, working until we die is not a “bad” thing if we enjoy what we do. That is the crux of the issue. Would you be able to enjoy what you do and be able to pursue the experiences you want to until the day you move on from this world?

I intend to experience life a bit more each day even as all of us walk towards our destiny with mortality. I intend to put myself in a position to choose what I want to do when I reach 67 and to continue to be active in mind, body and spirit. Working is fine as long as I choose what I want to do. I am prepared to monetise my home to fund retiring in Thailand if needed but am planning to do training and consulting and to be an independent director to fund my future lifestyle post “retirement”.

I don’t know for sure if I will achieve it but I know that I’ll have to invest time, energy and effort today to make it a possibility tomorrow.

The situation many people find themselves in is that when they reach the retirement age, they are forced to continue to work for the income to sustain themselves even when they hate their work. That is the situation that makes work a drudgery. I am thankful that my current job is a balanced one and enjoy coming to work daily. Hence, it is not drudgery but a privilege to be doing what I’m doing now. But I do not take for granted that things will never change so having a back-up is helpful before one needs to activate it.

Do you agree with MM Lee’s observations that we should abolish the retirement age and work until we expire?

What is your own plan towards “retirement”?

Share with Panzer in the comments section.

Be well and prosper.

This post is somewhat chilling and may literally scare some readers who may not be mature enough to read it. You have been warned Read on to learn more about thinking about your own TEOWAWKI…

Survivalism and TEOWAWKI

When I was a teenager, I loved playing computer games. The Wizardry, Ultima series of fantasy dungeons and dragons type of role-playing games where where I got immersed into the imaginary worlds created by the developers. As I go older, I graduated towards real time strategy (RTS) Command and Conquer types before adulthood resulted in me having less interest in gaming now that I’m closer to 40 than 20 in age!

One of the better games I played was “Wasteland” by Electronic Arts. It was a post-apocalyptic role-playing game that sees you bring a group of adventurers across the wasteland of Nevada to uncover a mystery and survive against hobos, mutant robots and other nasties.

Why am I talking about “Wasteland” and TEOWAWKI?

The reason why I explore this theme of survivalism and TEOWAWKI scenarios is because they are getting more real in today’s age. We are now as Handy described in his book, “The Age of Unreason” where CHANGE is happening all the time and with increasingly speed and impact. Understanding the possibilities of TEOWAWKI allows us to be better prepared to mitigate its effects and to survive it.

Life is Totally Unpredictable

Games like Wasteland talk about apocalyptic events, where something serious happens that disrupts our way of life as we know it. Hence, “The end of the world as we know it” (TEOWAWKI) is a phrase to denote paradigm changing events. If you are a follower of post-apocalyptic films and books, you will realise that the scenarios played where the earth is close to being wiped out include mega asterioid strike (see films such as “Armageddon“, “Deep Impact“) which incidentally is one of the popular theories about what killed the dinosaurs.

Other films include “The Day After Tomorrow” where extreme climate change causes huge disruptions to life and many people die trying to survive such calamaties. Games such as “Wasteland” or films such as “The Book of Eli“, “Terminator” series of films also use a post-nuclear war  scenario as the cause of TEOTWAWKI.

Increasingly, TEOTWAWKI scenarios are not so far fetched after all. Think back to the financial crisis in 2008 as well as the recent European sovereign debt problems. The financial meltdown of markets in equities, property, bonds and other related assets is very possible in our lifetimes. Even Singapore was not spared the 1997-98 Asian financial crisis as well as SARS in 2003.

In short, ANYTHING can happen and possible TEOWAWKI scenarios can play out whether we are prepared for them or not.

On a personal scale, I’ve experienced my near TEOWAWKI event when my spouse and I almost split up. It totally devastated me emotionally and rebuilt me up from scratch. All sense of self was lost in that episode but the irony is that because we went to the brink to near-collapse of the marriage, we are now somewhat reconciled back and am taking the marriage on a day-to-day basis to bring up our daughter together.

My own personal upheavals has made me more aware of how what we take for granted as the world that we know can totally collapse very quickly.

Preparing Yourself for Your Own TEOWAWKI

I’ve seen the Asian financial crisis with my own eyes and went through the 2003 SARS period. My own personal near armageddon made me more aware about how uncertain life really is and not to place too much hope in our external environment. For one thing, I now trust the stock market much less than when I first started.

While I have been fortunate in making decent returns (exceeding two times fixed deposits interest rates) from the stock market, I know it has been largely luck. Thus, it is challenging to replicate such returns consistently all the time. Hence, my own investment strategy now is not to have anything more than 50% of my investible savings in stocks and shares. I currently have 33% and am not really thinking hard on enlarging it.

The external environment is more challenging to control, hence I reallise I must control myself more. I will continue to invest in building up experiences, skills and knowledge that makes me better able to survive the uncertainties of today’s world. Thus, I need to build up useful skills to help me survive a future where I may not be able to retire with the same lifestyle in Singapore. Hence, my previous post talking about retiring in Thailand because of the lower cost of living in making my retirement income stretch much further in the Land of Smiles

Learning Thai, getting a class 2B licence and continuing with my toastmasters activities are part of building up useful skills for the future. But I am also considering survivalism principles into day-to-day life.

Survivalism

If you are into survivalism, it is about preparing yourself for TEOWAWKI scenarios. While having fallout shelters and being able to survive a global thermonuclear war is possibly out of the question for a place like Singapore, surviving flood or having power cut off for 72 hours may not be such a stretch as recent flooding in Singapore shows that even in our supposedly “first world” country, there can be localised blackouts and flooding.

Hence, I’m going to also start to prepare my 72 hour emergency bag or bug-out bag. If you read the Singapore Civil Defence literature, this is about preparing food, clothing, water, personal hygiene and medical items to survive 72 hours in an emergency before help can get to you. The US FEMA and even our own SCDF has guides to help us on that.

Financial survivalism principles are also important. Your investible savings are actually part of your life energy. You traded your life force through working or running a business to accumulate the savings, thus, it’s useful to think of how you will protect and grow your investible savings. It is with that mindset that I arrived at my internal maximum 50% rule on putting my investible savings into equities.

The more I read about TEOWAWKI and survivalism, the more I realise that most people in Singapore will not be able to fathom the possibility of such scenarios because you can hardly be self-sufficient in Singapore. Not much space to escape to (except perhaps for Ubin residents) and even if you have a fallout or disaster shelter, you have to emerge eventually when you stores run out to the post-TEOWAWKI scenario.

I believe I want to build up enough reserves to survive a localised TEOWAWKI scenario to be in a better position than others to survive it. However, I also know that if the post-apocalyptic type of global disaster really occurs, then perhaps our time on earth is really destined to be short.

Whatever it is, having a TEOWAWKI mindset to detach oneself from day-to-day worries does alter your perspective somewhat. Smaller, petty inconveniences in life pale in comparison to potential TEOWAWKI scenarios.

Have you ever considered TEOWAWKI scenarios in your financial planning?

Share with Panzer in the comments section.

Be well and prosper.

The more I read about lifestyle design and think about how it applies to retirement, the more I realise that my paradigm on what constitutes retirement has fundamentally changed.

Previously, I used to think like what many of us did, that retirement was an age and it was not to work. But increasingly, my own research and reading of books such as Tim Ferriss’ “The Five Hour Workweek” and thinking about the day-to-day trends we see in Singapore has led me to re-evaluate what it means to retire when I advance another 20 years in life from today.

Retirement is Not an Age

The CPF system and the traditonal life of study-work-retire is under pressure. First of all, increasing life expectancy sees us living longer and hence needing to fund our living over a longer period of time. Secondly, the concept of lifelong employment and having a job for life is under threat from today’s volatile world. Thirdly, research has shown that mentally we degenerate if we do not keep ourselves active mentally and physically after we transit from a full-time career to a post-career lifestyle of not going to a routine of working from 8.30 AM to 6.00 PM Mondays to Fridays.

I see retirement as more a lifestyle design issue in that one needs to plan for how one can live on possibly reduced cash flows from a full-time job and transit more into a lifestyle dependent on less certain cash flows supplemented with some freelance type of work and passive income from CPF or other sources.

Continuing Cashflows Post Career

To continue to thrive post-career when one is close to the “official” retirement age of 62 (will probably be 67 by the time I hit that age bracket), one needs to plan for cashflows or a source of income then. Our CPF will only allow us a very subsistence type of living if we have minimum sum. Many will barely have it as most of our CPF is parked in our homes. Thus, I realise that one of the paradigm shifts that occurred for me was to be open to monetising my home through renting it out.

Now if I rent out my home, where am I going to stay? I’ll address that part in the later part of this article.

The other part of having cashflows is to have some useful and marketable skill that can translate into an income source. I believe I can do consultancy and training in the areas of public speaking, internal audit and fraud as well as general softskills type of “management” training. What I am doing now to build up those skillsets are to continue with my toastmasters activities, to deliver training in my current job as a value-add to my organisation and to continue to read widely in these areas to beef up the knowledge part. The toastmastering and actual conduct of training courses (beyond) my job scope  and speaking at conferences and seminars help me put into practise those skills needed in the future.

Living in a Lower Cost Environment

It is already happening. The Government has allowed us to use our Medisave in lower cost countries’ medical facilities. Taking the next logical step in the lifestyle design equation, why not transplant ourselves into a lower cost ASEAN country? This can work because we can monetise our main asset – our homes by renting them out for income, and then using that income to live more cheaply in a lower cost country. My current target is Thailand because it is quite big and you can find interesting locations to retire.

The catch is language. I have enrolled in a part-time (evening) conversational Thai course and intend to learn written Thai. I give myself 20 years to get fluent in the language and I am starting NOW even though I can actually pick it up later but I think planning ahead by taking the actions now will put me in a much stronger position to do so later.

By learning Thai now, I also can access more of Thailand’s culture and lifestyle as a tourist and slowly work up to be a retirement resident there in the future. Again, it gives me 20 or so years to get myself immersed into Thai culture and living there.

I am also planning to get my class 2B licence so as to learn how to ride a motorcycle. Getting around is not a big problem if you can drive or ride a motorbike. Given the economies and practicalities of getting around by bike in our neighbouring ASEAN countries, I realise learning to ride a bike would be a useful lifeskill going forward.

I feel excited about this plan because I think there are many direct and indirect spin offs from executing it. The skills such as speaking Thai and riding a bike will come in useful even in my life now as I can travel to more locations within Thailand as a tourist. Having a class 2B licence now will also make transportation easier now as my current home and workplace takes 2 buses to get to but would probably take me 10-15 minutes riding time depending on traffic condition. Hence, riding a motorcycle makes a lot of sense as my spouse takes the car on most days.

Once I learn Thai, I can shift my residence to Thailand and probably live off the rental of my home. I can supplement my income by teaching Thais English or to do training in Singapore in the areas of my professional interest.

Have you seriously considered your post-career plans?

Does it involve a radical move to a lower cost country?

Share with Panzer in the comments section.

Be well and prosper.

Buckhead home from flickr by The Gifted Photographer

I just made a significant mortgage loan payment using my CPF ordinary account which currently stands at $0.15 as at today. My special and medisave accounts are reasonably funded as there’s not many avenues for me to tap on those funds nor would I want to as they are meant for retirement and medical needs in the future.

Looking back, my net-worth is at a relatively low stage compared to two years ago mainly because I have used my savings to top-up. My current new home is funded using proceeds from sale of my old home plus my CPF ordinary account and cash savings accumulated since paying off my previous home’s mortgage.

Technically, my mortgage can be completely paid up today if I want to but I decided to keep some of it (below $100,000) and build up a stronger cash on hand position for more flexibility in investment decisions I may make in the short-term (next 2 years or so).

When Your Net Assets Doesn’t Move Much

I sometimes feel impatient when I see that I am slowing down in my journey towards having $1,000,000 in investible net worth (excluding residential home). During army days, we call the situation of stagnating as “hentak-kaki” or marching on the spot; there appears to be much movement but you’re not getting anywhere.

Basically my net asset position has stagnated because the savings that I have obtained since I paid off my previous home has been invested in my current home which cannot be monetised unless I sell or rent out the home.

Hence, looking at it purely from the figure for net investible savings (which excludes value of my current new property) I have actually lost some ground in my journey towards financial freedom.

Looking at the Positives

However, I’ve gained in other ways that are not immediately tangible. My current property is in a better neighbourhood and the ability to rent for higher rental income is there relative to my previous property. My current place has a bigger floor area and is quieter. Such qualities can be monetised in the future should the rental or sale be required.

During the process of moving home, I also realised that despite my net worth stagnating using the conservative calculation of excluding value of current property I start to understand more about how I am really the main cash flow generating asset.

I’ve taken another step towards getting myself an appointment as an independent director. This is something I’m working on as a possible post-62 career as well as a way to monetise my assets as an accounting and audit trained professional. It is about building up my CV now for better earnings in the future.

Another realisation is that I’m getting less fixated about the numerical targets set for my eventual financial freedom but getting more interested in enjoying the process and the journey. I now network more to get connected with people just to understand more about life outside of my own routine rather than to seek to benefit from the “guanxi” that can be derived. I’ve started to build myself more into a linchpin in my own career and personal life rather than to be a passive rider on this roller-coaster ride that is life.

Counting is important but making your life count is also more important

The key realisation is that setting, counting and hitting targets in life is important. We do what we measure and we need to pursue tangible goals to know if we are on track or not in our life goals. But more importantly, it sinks in that making my life count more is more important even as we track the numbers that give us the feedback on how well we’re meeting our goals.

How are you counting your net assets and how do you make your life count?

Share with Panzer in the comments section.

Be well and prosper.

Photo by Alan Cleaver

If you dig a little deeper into your own intrinsic motivations for being financially free, it has its roots in trying to be happy.

We live in Singapore Inc. which is a place that worships money. Money makes Singapore go round and we need it to put food on the table, to pay our bills and to sustain our lifestyles. Yet, more and more studies show that while money and happiness are correlated, our day-to-day satisfaction with life go beyond money if we have managed to meet our basic needs.

Money Can Buy One Form of Happiness

This article from the Washington Post tells us that money can indeed buy one form of happiness. But it still is not the be-all and the end-all to becoming happy. It goes on to say that:

But the survey also showed that a key element of what many people consider happiness — positive feelings — is much more strongly affected by factors other than cold, hard cash, such as feeling respected, being in control of your life and having friends and family to rely on in a pinch.

Thus, positive feelings on a day-to-day basis is dependent more on non-monetary factors that are affected a lot by the quality of the relationships you have with people. That is what I am discovering as well. Really, money is a hygiene factor that must be met so that we are NOT unhappy but by itself money doesn’t satisfy totally.

The repercussions of this is that the journey towards financial freedom becomes more important than the goal itself. It is critical that we enjoy our journey towards financial freedom while working towards the goal or we might find ourselves one day asking ourselves, “Is this all there is to achieving financial freedom?”

I realise that working towards being a “renaissance man” or a person with multiple interests who makes use of his left and right parts of his brain is critical to having a fulfilling journey towards financial freedom.

Concentrating enough of our lives into our careers, family, friends and self is important to achieve that balance and personal growth that generates the positive day-to-day feelings.

Panzer’s Journey At Work

My career now sees me plying my trade in internal audit but also involves being a manager of people. Even within my small team, I encountered human resource issues that arise within my team and have to sit down and talk to people to get them resolved. I learnt over time that some issues cannot be resolved but my staff feels better after getting the issues off their chest and out into the open.

Thus, even as my career generates the cash flows in my journey towards financial freedom, it also gives me the opportunity to develop other aspects of my career, that is to be a manager who is both a leader and a mentor plus counsellor to the staff.

How does this help me in my financial freedom journey?

My staff are the ones who carry out the detailed work activities under my direction and supervision. Without them, I cannot accomplish as much by myself. Hence, my value-add is to get them to value-add to the organisation thus multiplying the positive outcomes from the department’s perspective.

They help me achieve my key performance indicators which in turn are how my own financial rewards in career are determined. Of course, I also do my part but once you achieve a certain degree of seniority in your career and manage people, you realise your success depends on helping your team succeed in their objectives and tasks.

Thus, if my staff are happy, I am happy and the organisation also benefits from their increased quantity and quality of output. The money equation in their compensation package is mostly a hygiene factor and I need to focus more on the quality of intra-office communication and individual coaching of my staff to really obtain engagement.

Ultimately, my own journey towards financial freedom which requires my career to continue to thrive requires a functional team that is happy through the respect and control that I grant to them to manage their work assignments.

What is your view on happiness and money?

Which comes first, money or happiness?

Share with Panzer.

Be well and prosper.