Happy New Year 2015

As we usher into the Year of 2015, we wish everyone a Happy and Prosperous New Year.

Stay safe and be blessed always.

Prayers to Families of QZ8501

Our prayers and condolences to Families of Flight QZ8501

China Steps In as World's New Bank

Article here

Thanks to China, Christine Lagarde of the International Monetary Fund, Jim Yong Kim of the World Bank and Takehiko Nakao of the Asian Development Bank may no longer have much meaningful work to do.

Beijing's move to bail out Russia, on top of its recent aid for Venezuela and Argentina, signals the death of the post-war Bretton Woods world. It’s also marks the beginning of the end for America's linchpin role in the global economy and Japan's influence in Asia.

What is China's new Asian Infrastructure Investment Bank if not an ADB killer? If Japan, ADB's main benefactor, won't share the presidency with Asian peers, Beijing will just use its deep pockets to overpower it. Lagarde's and Kim’s shops also are looking at a future in which crisis-wracked governments call Beijing before Washington. 

China stepping up its role as lender of last resort upends an economic development game that's been decades in the making. The IMF, World Bank and ADB are bloated, change-adverse institutions.  When Ukraine received a $17 billion IMF-led bailout this year it was about shoring up a geopolitically important economy, not geopolitical blackmail.

Chinese President Xi Jinping's government doesn't care about upgrading economies, the health of tax regimes or central bank reserves. It cares about loyalty. The quid pro quo: For our generous assistance we expect your full support on everything from Taiwan to territorial disputes to deadening the West’s pesky focus on human rights.

This may sound hyperbolic; Russia, Argentina and Venezuela are already at odds with the U.S. and its allies. But what about Europe? In 2011 and 2012, it looked to Beijing to save euro bond markets through massive purchases. Expect more of this dynamic in 2015 should fresh turmoil hit the euro zone, at which time Beijing will expect European leaders to pull their diplomatic punches. What happens if the Federal Reserve’s tapering slams economies from India to Indonesia and governments look to China for help? Why would Cambodia, Laos or Vietnam bother with the IMF’s conditions when China writes big checks with few strings attached?

Beijing’s $24 billion currency swap program to help Russia is a sign of things to come. Russia, it's often said, is too nuclear to fail. As Moscow weathers the worst crisis since the 1998 default, it’s tempting to view China as a good global citizen. But Beijing is just enabling President Vladimir Putin, who’s now under zero pressure to diversify his economy away from oil. The same goes for China’s $2.3 billion currency swap with Argentina and its $4 billion loan to Venezuela. In the Chinese century, bad behavior has its rewards.

If ever there were a time for President Barack Obama to accelerate his "pivot" to Asia it's now. There's plenty to worry about as China tosses money at rogue governments like Sudan and Zimbabwe. But there’s also lots at stake for Asia's budding democracies. The so-called Washington consensus on economic policies isn't perfect, but is Beijing's model of autocratic state capitalism with scant press freedom really a better option? With China becoming Asia's sugar daddy, the temptation in, say, Myanmar might be to avoid the difficult process of creating credible institutions to oversee the economy.

There could be a silver lining to China lavishing its nearly $4 trillion of currency reserves on crisis-plagued nations: It might force the IMF, World Bank and ADB to raise their games. Competition, as Lagarde, Kim and Nakao would agree, is a good thing. But more likely, China's largess will encourage bad policy habits and impede development in ways that leave the global economy worse off.

Warren Buffett Tells You How to Turn $40 Into $10 Million

Warren Buffett Tells You How to Turn $40 Into $10 Million

By Patrick Morris 

Warren Buffett is perhaps the greatest investor of all time, and he has a simple solution that could help an individual turn $40 into $10 million.

A few years ago, Berkshire Hathaway CEO and Chairman Warren Buffett spoke about one of his favorite companies, Coca-Cola, and how after dividends, stock splits, and patient reinvestment, someone who bought just $40 worth of the company's stock when it went public in 1919 would now have more than $5 million.

Yet in April 2012, when the board of directors proposed a stock split of the beloved soft-drink manufacturer, that figure was updated and the company noted that original $40 would now be worth $9.8 million. A little back-of-the-envelope math of the total return of Coke since May 2012 would mean that $9.8 million is now worth about $10.8 million.

The power of patience

I know that $40 in 1919 is very different from $40 today. However, even after factoring for inflation, it turns out to be $540 in today's money. Put differently, would you rather have an Xbox One, or almost $11 million?

But the thing is, it isn't even as though an investment in Coca-Cola was a no-brainer at that point, or in the near century since then. Sugar prices were rising. World War I had just ended a year prior. The Great Depression happened a few years later. World War II resulted in sugar rationing. And there have been countless other things over the past 100 years that would cause someone to question whether their money should be in stocks, much less one of a consumer-goods company like Coca-Cola.

The dangers of timing

Yet as Buffett has noted continually, it's terribly dangerous to attempt to time the market:

"With a wonderful business, you can figure out what will happen; you can't figure out when it will happen. You don't want to focus on when, you want to focus on what. If you're right about what, you don't have to worry about when" 

So often investors are told they must attempt to time the market, and begin investing when the market is on the rise, and sell when the market is falling.

This type of technical analysis of watching stock movements and buying based on how the prices fluctuate over 200-day moving averages or other seemingly arbitrary fluctuations often receives a lot of media attention, but it has been proved to simply be no better than random chance. 

Investing for the long term

Individuals need to see that investing is not like placing a wager on the 49ers to cover the spread against the Cowboys, but instead it's buying a tangible piece of a business.

It is absolutely important to understand the relative price you are paying for that business, but what isn't important is attempting to understand whether you're buying in at the "right time," as that is so often just an arbitrary imagination.

In Buffett's own words, "if you're right about the business, you'll make a lot of money," so don't bother about attempting to buy stocks based on how their stock charts have looked over the past 200 days. Instead always remember that "it's far better to buy a wonderful company at a fair price."

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Pray for Malaysia, Any kind of help is needed

Updated :

Major states in Malaysia have been hit with severe floods as high as 3 to 4 storey's high.

The latest news is GH (General Hospital) in Kuala Krai is running out of diesel and the hospital is in dire straits. Help cannot reach upon the site and the hospital is really running on whatever is left. 

The update can be read here

Here is an update from a quite desperate Doctor Nur Izzati direct from Kuala Krai Hospital. I am getting this info relayed through people in Pahang and Putrajaya. 

.
[20:11, 25/12/2014] Dr Nur Izzati: Bismillah..
.
Sekarang generator sudah kehabisan minyak. Seluruh hospital bergelap, lampu kecemasan menyala di sesetengah bilik. Tadi kami incubate baby dalam gelap...SpO2 drop sampai 18, bradycardia, Anaest specialist sendiri datang menyelamatkan keadaan. Pesakit icu dan ccu bernafas dengan mesin yang dijana kuasa bateri. Kalau bekalan tak pulih, kami akan bergilir2 manual bagging ...sampai..?
..
Minyak diesel utk generator dijanjikan sampai pukul 8.30 malam. Akan dihantar dengan helikopter.Masalah yg sedang dibincangkan; kami gelap gelita, flare gun tak ada, we need lights to show them where we are. 

.
Kuala Krai has become a huge river, and our hospital is one of the few islands, which unfortunately doesnt glow in the dark. .

Petang tadi kami semua excited. Helikopter datang with all the pomp, flair and machismo of Hollywood action movies. Everyone - who could make it, were out in the parking lot, waving, taking photos, wiping tears of joy, finally we were going to be saved. But were we? NO.
 
They weren't able to land. No space wide enough. No heli pad (duh of course). The rotor whirled so hard water splashed from the flooded area, debris flew up, and they said the roofs would detach if the heli came closer. The only way to rescue patients is by hoisting them up, airlift them - like in the movies. From the boats, or from a clearing very near the water edge.

We're talking about ill patients here. Yang bernafas dengan mesin, bayi2 baru lahir, orang tua patah tulang..
Mereka pergi. They departed and left us wondering. Kami terpinga2..
Kemudian  kami diarahkan utk bersedia semula utk evacuation. Able bodied patients, those few who are well enough to do a Schwarzenegger up a helicopter, were rounded up. Kami keluar ramai2 dan menunggu - tak tahu tunggu apa.
.
Helikopter berlegar2...dan tidak menghantar apa2. Kenderaan amfibia milik bomba datang. Kemudian ia pergi semula. 

.

Matron mengumumkan "tak jadi pindah, sila pulang ke wad masing2." Dan kerana lif tidak berfungsi (menggunakan lif dalam keadaan elektrik on-off begini pun adalah tindakan amat bahaya), pesakit2 ini beramai2 mengheret badan menaiki tangga.
.
Kami kecewa. Kecewa, dan takut..
Seorang kanak2 bertanya bapanya, as he saw the amphibian vehicle left us..deserted us.

"Abah, bakpo diorg datang?"

Entah. Kenapa kalian datang? Pusing2, tengok2 keadaan, kemudian bye bye good luck? .

• Kami dengar khabar ada pasukan bantuan di Pejabat Tanah, di Wisma. 
• Kami dengar khabar kanak2  yg berlindung di SMKSYP tak ada makanan. 
• Kami dengar khabar kampung2 masih terpisah drpd bantuan kerana 'arus deras, tak cukup bot, bahaya'.

Khabarnya minyak diesel utk generator akan sampai sekejap lagi. Kami menunggu. 

Khabarnya persediaan sedang dibuat utk memindahkan pesakit, for real this time. Kami menunggu.

Seorang doktor tentera vv LUAR YANG BARU SAMPAI SETAKAT INI) baru tiba, dan kami harap ketibaannya will mean a difference.

Kami menunggu.

• .Mak ayah dan adik2 saya masih terperangkap entah atas bukit mana di Kuala Nal.
• Orang2 kampung Kuala Nal bertarung nyawa dengan arus deras, rumah2 telah hanyut. 
• Bagaimana dengan orang Kampung Bahagia, 
• orang2 di kampung2 seberang Sg Kelantan? 
• Saya tak tahu apa nak dibuat.

Khabarnya pagi tadi tv menyiarkan isu perkahwinan semasa banjir.

SHAME ON YOU, MALAYSIA. SHAME ON YOU..
Kami menunggu.

[20:12, 25/12/2014] Dr Nur Izzati: -Update dari hospital kuala kerai-

Ends.

Earlier update here

For more updates and photo aid, you may click here

Meanwhile the Malaysian PM seems to be having a GOLFING time in Hawaii with Barak Obama.

Merry Christmas Everyone

I will be back soon

FELDA HAS RM10 BILLION CASH!!

'...FELDA's RM10 billion is kept in cash, bonds and with fund managers (including EPF)....'
Source : OutSyed The Box

Tuesday, December 16, 2014

WAHAI PENYAMUN, DENGAR SINI "FELDA HAS RM10 BILLION CASH!!"

I received an interesting phone call last nite. Yup its about Felda. 

Folks there is FELDA (FELDA proper lah). Then there is FGV or Felda Global Ventures Bhd the listed vehicle - whose share price has gone crashing from RM4.55 down to RM2.37. 

Then you also have Felda Investment Corporation which buys properties in London etc. Semua lain-lain ok. So lets choose our way carefully.

I also want to touch on something else. Old issue but worth clarifying. 

I saved a lot of simple kampong people a few hundred million Ringgit when I highlighted in my Blog that the 'Fund' in which they invested was planning to spend their money in a property project in some broken down city in the US.  I blogged about it twice.  I hope you folks can recall.

The CEO and mangement team of that 'Fund', the PM and her husband were all on their way to New York to witness the signing away of the kampong folks' hard earned money.

At the very, very last minute, after my Blog post appeared, that signing ceremony in New York was cancelled.  A few hundred million Ringgits of kampong peoples' money was saved. Alhamdulillah. 

Some bangang bloggers  err..maaf ya UMNO Bloggers  put it out that I was lying about the investment by that Fund. They said there was no such thing.  Well according to the party president  Najib Tun Razak these are bloggers who are paid to write.  So when they get money they willl write  - paid in cash and sometimes paid in kind.

Well I had received first class information about the Fund's planned investment. Their Board had approved the investment.  And in their Board paper their Risk Manager had even recommended against the investment.  I am not saying that I saw the Board paper myself. (Neither am I saying that I did not see the Board paper).  But I am certain of my information.

Then about two days after that Blog post I received a phone call from a close friend who also knows the Chairman of that  Fund quite well. He said that the Chairman wanted  to meet me. Bila?  "Malam ni juga" was the reply. I politely declined.  It really was too short notice and I had my usual plans (meeting other sources and informers  haa haa !!).

Last nite I received another phone call. This time about FELDA. Wild stuff is going on in FELDA.  One Director General of FELDA has been kicked out of his job.  Another DG has taken over.  But now this new DG of FELDA has also been suspended from his job pula. 

What is going on in FELDA? TAKKAN DUA DG BOLEH JADI AGEN ZIONIS BRO?

Two DG's put in the freezer one after the other.

Here is the scoop folks. FELDA has RM10 BILLION IN CASH RESERVES !! And SOMEONE is eyeing it !!

FELDA's RM10 billion is kept in cash, bonds and with fund managers (including EPF). 

While some folks are eyeing this RM10 BILLION, other folks are standing in their way.

This is the reason  (to quite some extent) for the tiffs and struggles going on inside FELDA.

Organisations like FELDA (being government set ups) are protected by layers of red tape and bureaucracy.  To get the money out you need someone to do a paper. Someone has to reccommend the paper. It probably has to be presented to some committee. Then finally, after the committee, it will be presented to the Board.  Many layers. If someone along the way does not agree or puts in a negative remark, it could throw a spanner into the works.

Hence it is important that for the Dawn of the Age of Aquarius, Jupiter must align with Mars and Saturn must click with Pluto.   I think this is what is going on in FELDA right now. Serous alignments and realignments are taking place.

Siapa punya "alignment" tak betul, you can visit Bangsar Tyre Service Center (dekat Syed Restoran - bukan saya punya ok). 

And it all goes up to the 'Kitchen Cabinet'. I was told some more information last nite  tapi takut nanti kena Sedition ke, whatever ke. 

So to all you people out there, lets team up and keep an eye on FELDA's RM10 BILLION in cash reserves.  If we all act together we can really move mountains.  All of us together - Dayak, Kadazan, Melanau, Sulu, Melayu, Cina, India, Mamak, Punjabi (I like to mention the Punjabis), Muslim, Hindu, Christian, Buddhist - everyone.   

All pull together in one direction.  If we do not hang together we will surely hang separately. 

Posted by Syed Akbar Ali at 3:52:00 PM 

Iskandar’s plunging fortunes

Iskandar’s booming property market has come crashing down this past year. Cooling measures implemented by the government, coupled with chronic oversupply, declining demand as well as controversial land deals have cast storm clouds over the economic hub. (Source : Kinibiz)

________________________________________________________________

This has been a year to forget for the Iskandar economic region in Johor.

After much lauded growth in the last five years, led by a robust property market, cracks began to show in Iskandar this year. Bullishness about Iskandar’s property market has been replaced with a more cautious, sometimes even bleaker outlook.

What is causing this dwindling optimism about Iskandar? For a start, the numbers don’t lie.

Alarming drop

country garden danga bay iskandar johor 2“In comparison to the first half of 2013, there was a drop of about 48% in terms of total transactions in the same period this year,” said V Sivadas, executive director of PA International Property Consultants based in Johor Bahru (JB).

That is an alarming drop in sales by any standards. The fact that it is happening just when Iskandar seems to have picked up momentum in the last few years has rattled the market.

According to Sivadas, this decline is across all sectors of the property market in Iskandar.

“Our records indicate 5,419 total transactions in the first half of this year at a value of about RM3.7 billion. In comparison with the first half of 2013, there was a drop of about 48% in terms of total transactions and about 37% drop in terms of total value of transactions in the first half of 2014,” said Sivadas who based his analysis on available records of properties sales within Iskandar Malaysia.

According to Sivadas, 2013 was the peak of the Iskandar market in terms of number of transactions (25,034 transactions) and total value of transactions (estimated RM20.3 billion — excluding the controversial RM4.5 billion land sale by the Johor Sultan to Guangzhou R&F). In comparison, there were 21,503 transactions in 2012, at a total value of about RM13.5 billion.

The 20-year project is spread across a sprawling 550,000 acres and divided into five flagship zones in Johor and has experienced exponential growth. It is designed to rejuvenate JB and position it as a major regional economic hub. It is targeting between RM20 billion to RM22 billion in investments targeted yearly until 2025.

Although Iskandar consists of several designated zones, property development has arguably fuelled its remarkable growth in recent years. Major property developers, both local and foreign, have flocked to Iskandar in the last five years to ride the wave of Iskandar’s property boom.

It’s not that the well has run dry for Iskandar. Recently, Prime Minister Najib Abdul Razak announced that Iskandar has attracted close to RM25 billion worth of investments this year, adding up to a total of RM156 billion investments secured for the region since its inception in 2006.

Supply outrunning demand

Country Garden Holdings Co Ltd at Danga BayFor many observers, the root cause of the slump this year has simply been supply outrunning demand in Iskandar.

Even as early as January this year, it was reported that purchase bookings of new property launches in Iskandar were already down 20% to 30%. Several other factors have contributed to the cooling down of the Iskandar property market.

Last year, the federal and state governments moved to check an overheating property market nationwide. An increase in Real Property Gains Tax (RPGT), hiking minimum property purchases of foreigners from RM500,000 to RM1 million and a property levy of 2% for foreign purchases in Johor were all implemented to clamp down on speculative buying.

All of these measures slowed down the market considerably this year, Iskandar included.

Market observers have also cautioned that the influx of big Chinese developers, such as Country Garden and Guangzhou R&F, into Iskandar could backfire. Although they have brought in much needed investments, the massive scale of their launches have analysts worried about a potential oversupply or overhang in the market.

Country Garden launched 9,000 units of the Danga Bay development in 2013, a scale that was unprecedented in the Johor market. Guangzhou R&F’s development on the 116 acres it bought from the Johor Sultan is set to dwarf Country Garden’s project.

It has also been reported that Guangzhou R&F is planning to launch a staggering 30,000 units in the next few years.

Chinese invasion

These mammoth developments and launches by the Chinese developers in Iskandar have sparked genuine fears that a severe oversupply of high-end units will drag down the Iskandar region for years to come.

“Most of Country Garden’s and Guangzhou R&F’s properties are premium priced. Very few ordinary JB residents can afford them. If the Singaporeans stop buying, they will be in deep trouble. I feel their sales are already suffering, although no official figures have been released,” said Andy Mohan, a property agent in JB.

Even major local developers have not been spared the impact of the Chinese invasion in Iskandar.

Last August, UEM Sunrise slashed its annual sales target by 40% due to poor second quarter (2Q14) results, partly due to poor take up of new its launches in Iskandar.

UEM Sunrise’s new chief executive officer Anwar Syahrin Abdul Ajib has also said that the company will “re-strategise” its position and reduce its dependency on Iskandar, where it has approximately 60% of its total land bank.

The fact that UEM Sunrise, one of the biggest developers in Malaysia and master developer of Nusajaya, one of the designated zones in Iskandar, is feeling the pinch and re-evaluating its business its Iskandar is a telling sign that all is not well in Iskandar.

HfW - When the Market Gets Scary

You really can't time the market — this time isn't any different!

This past Friday, the Dow Jones Industrial Average closed at 16,544. That's about 100 points higher than its close on January 2, the first trading day of the year.

Yes, the stock market is higher today than it was nine months ago.

That statistic might surprise you. After all, over the past couple of weeks, the stock market has been gyrating. The Dow fell 273 points last Tuesday - and then rose 275 points the next day. How can anyone make any sense out of that?

You can't - so don't even bother trying. That's why we instead focus on the long-term. Markets always react in the short-term, so it helps to remind ourselves that the stock market is higher today than it was two years ago, and it's ten thousand points higher than it was six years ago!

The market is now 10,000 points higher then it was in 2008!

But many people aren't focusing on that. They are worried about the economy in Europe, unrest in Ukraine and Hong Kong, threats from ISIS and, of course, Ebola. The media tend to overstate the bad news and underplay the good news - like the fact that unemployment is at the lowest level since 2007, mortgage delinquencies are at their lowest level in six years, the manufacturing index is at higher levels than it was prior to 2008 and U.S. auto sales are poised to set an all-time record this year.

And that's why we're writing to you today. We want to reassure you, and remind you that we've all seen this movie before, as our letter to you in August noted. Yes, stock prices since then have indeed been going down - but that's part of what stock prices do; the other part is that they also go up. And history tells us two things: After every down period, there's an up period, and every up period is larger and longer than each preceding down period, as the accompanying chart shows. Every down period, therefore, has proved to be a great time for you to add to your long-term portfolio.

Perhaps you're not convinced - maybe because Ebola is dominating the news lately. If that seems like scary stuff, it might help to put it into context. Before you ever heard of Ebola, the news was filled with stories about Mad Cow Disease. Before that it was SARS. Before that, Avian flu, and before that the "swine" flu. In 2011, stories warned that the Mayan calendar predicted that the world would end in 2012. Before that, of course, was Y2K.

There's always something out there that the media say is imminently going to cause our destruction. As comedian Alonzo Bodden said, "Weren't we all supposed to be dead by now? I don't know about you, but I stopped paying my bills."

His point is well taken. We mustn't let ourselves get upset by the latest headlines of doom. Experts in behavioral finance call this catastrophizing. We humans tend to take a piece of information and automatically assume the worst, filling ourselves with such fear that all rationality leaves us.

Your long term goals are what matter!

It's important that we stay focused on our long-term goals. If you have an effective strategy to achieve your long-term financial goals - and as our client, you do - all you need to do is stick with that strategy. It's as simple as that. Rest assured that we are monitoring your account daily, maintaining extensive diversification for you to help control risk and, as opportunities arise, we're exploiting the market's volatility to rebalance your account.

Of course, if something has changed in your life that might require alteration in that strategy (including a change in marital status, employment, income need, health or risk tolerance), please tell us. Otherwise, you can ignore the headlines with confidence.

And when you come upon others who express worry or fear, you can invite them to contact us, so we can help them obtain the same quiet confidence that you enjoy. We're happy to help your friends, family and colleagues, too, if they need our help. And if they're worrying, they really should call us.

As should you — anytime you have any questions or concerns.

As always, we'll continue to monitor your accounts and keep you informed.

Regards!

Ric Edelman
Chairman and CEO

David Bach
Vice Chairman

HfW - Where are you?

At some point in life you will need to financially plan for your well being. So where are you now?

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HfW - Food for Thought

Some food for thought for all walks of life.

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Malaysia can withstand the shock from the fluctuations of oil prices and ringgit

Source : The Star (Article here)

11 Dec 2014

KUALA LUMPUR: Malaysia is able to withstand the shock from the fluctuations of oil prices and ringgit due to its fiscal strategy to reduce its dependency on its oil and gas (O&G) revenue over the years.

Minister in the Prime Minister Department Datuk Seri Abdul Wahid Omar said the Government had been able to diversify its income streams and reduce its dependency on O&G revenue to 31% last year from 36% in 2011.

“Currently, 55% of our gross domestics product is contributed by the services sector, 25% from manufacturing sector, 8% from the mining sector that includes O&G and another 8% from the agricultural sector,” he said in his keynote address at the opening ceremony of International Petroleum Technology Conference (IPTC) yesterday.

Also present at the event was United Arab Emirates’ Energy Undersecretary Minister Dr Matar Al Neyadi.

Nevertheless, Wahid said the current oil price of below US$70 per barrel was at a level unseen since May 2010 and that the trend was expected to continue due to a number of reasons.

He said they were the high production of oil, the decision made by the Organisation of the Petroleum Exporting Countries not to cut output and some headwinds from China.

“Thus, oil companies are currently reviewing their capital expenditure and revisiting their investment plan but, fundamentally, demand for energy should not subside supported by growing population and other development factors,” he said.

What was more important in this volatile market condition, according to Wahid, is that energy must continue to be delivered at affordable prices.

This was because, he said the right to use energy had become a necessity similar to basic rights to adequate water, food and health services.

He said the industry, must now continue to adapt to the situation and focus on efficiency that should rely on innovation.

The implementation of the goods and services tax would further strengthen the Government’s fiscal position too, said Wahid.

Meanwhile, IPTC executive committee co-chairman Datuk Wee Yiaw Hin said there were “many moving parts” that affect the oil price.

“There is regional and global economic growth rate, supply and demand, geopolitics, costs of production as well as technology and innovation.

“My view is that the past four to five years of stability previously, the moving parts were all going in the wrong direction.

“They all come together now, resulting in a major disruption,” said Wee, who is also Petronas upstream executive vice-president and chief executive officer.


Wee said the industry needed to work out a new plan and control cost, efficiency and innovation to face this challenge.

HfW - I save up so I can....

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HfW - Food for Thought

Take a few moments to ponder and start asking yourself why. In the upcoming post I will share the age group for insolvency.

HfW – Mindset on Savings

‘I don’t need to save because I don’t see a need to yet’

‘What is savings?’

‘Why should I save up now? I am still single’

‘I have enough right now’

‘How can I save up when I don’t have enough to begin with?’

‘Savings? I have not thought about it’

These are some of the statements you often hear when one talks about savings.

In my last post, I asked if you started saving as much as $100 a month, how much would that be in 10 years?

With savings of $100/month, that translates to $1,200/year. That amount if rightly invested would yield you the following :

$21,037 (Year 10)

$41,940 (Year15)

$75,603 (Year20)

Many are not aware of this as they think saving up $100 a month is totally insignificant.

Well, that is absolutely not true. I will write more about it in my later post.

Coming back to the topic at hand, I have spoken to many people from different age category. They can be split into 4 major categories :

Age 22 – 28 : Don’t need to save up. Shall save later when I see a need to.

Age 29 – 35 : Need to begin saving. Some know how to save, some don’t know how to begin with.

Age 36 – 45 : Definitely must save. Some already have proper savings plan

> Age 46 : Yeah there is a savings plan for my future – retirement, children, etc.

I have been thru 2 out of the 4 age categories, and now I am in strolling in the 3^rd (Age 36-45) and I used to be like them.

When I was in my mid 20s I didn’t see a need to save. Everything was enough and self-sufficient. I understood what savings was and I understood a need for it but later. As like all those in their 20’s I saw a greater need to spend. Lol

Do you know why? The thrill in spending, that’s why.

If saving was like spending just like how you would spend a $100 on CDs, gadgets and other useless stuff, then savings would also equally give you the same thrill. Unfortunately it doesn’t.

You just needed to spend to satisfy that lust of yours.

Fast forward 10 years later, you would still need to spend but on greater materials. The question then begs, where would you get the money then?

Well, had you saved up a $100/month 10 years ago, todate you will have on hand $21,037.

In my next post, I will share more about this topic and also a concerning one - the bankruptcy rate amongst our youth todate.

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Health For Wealth

It doesn’t literally mean that you need to sacrifice your health in exchange for wealth. Duh!!

The social circles of today are ever chasing for wealth and any form of material. We have seen the most billionaires emerging from China and India in the last 10 years or so.

And that sets a trend. Many are jumping onto the bandwagon, chasing wealth at the expense of friendship, relationship and even health. I have to say that is stupid.

Has anyone of you heard of David Bach? David Bach is best known for his Finish Rich Book Series and Automatic Millionaire Series of motivational financial books under the Finish Rich® Brand. Eleven of Bach’s books have been national bestsellers, including nine consecutive New York Times bestsellers, two of which were consecutive #1 New York Times bestsellers (The Automatic Millionaire and Start Late, Finish Rich)

To know more about David Bach click here.

So what changed me?

Like I said earlier, both good and bad chains of events have taken place in my last 5 years of life; mostly good though.

I am pleased to have such a beautiful wife, ever caring and managing my 2 daughters. My 2 daughters have grown up so quickly to be even more beautiful than my wife what I could have imagined. Today they are 9 and 7 respectively.

In a very short 10 years from now, they will be moving on with their lives starting with tertiary education and slowly moving into the working world.

They will then leave my wife and I to cuddle each other apart from our unique arguments to begin a journey that is being set out for them.

In the last 5 years, everything that I have done has been for the family if not the kids. It has always been saving up for the kids. But the problem was the incremental savings year after year was not visible. Yeah, it was supposed to be incremental yet it wasn’t an amount that I would be glad of.

Our form of savings was to dump into conventional investments like Fixed Deposits. Slowly I started to venture out; from gold investments to foreign currency deposits to mutual funds / unit trust.

In the next 5 years, I have set a target to see my capital investments giving me a return of ~20% on an annualized average. Ok here comes my technical jargons.

Anyway to cut a long story short, with the constant nagging of my wife, I took up a financial license. And here so I am to share the beautiful news, awareness and experience.

Just a question to everyone before I end the post – if you saved up $100 a month, how much would that be in 10 years?

In my next post, I will share the generation mindset about savings.

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