Apple vs Xiaomi: How Can You Do Better with Removing Chargers?

 

Dear Readers,

Thank you for coming here!

Xiaomi announced on 28th Dec its second flagship this year — Mi 11. 

It is no doubt a great phone with top-nudge screen and performance. What’s better, the thickness and weight both improved, which have not been Xiaomi’s strength. 

The details are all over the web, so I won’t waste your time here.

What did catch my eye was how Xiaomi dealt with removing the charger to protect the environment.

Instead of “telling” you the charger will no longer be included for the good of everyone, Xiaomi gave its customers “well-designed” options.

• “Standard” Edition: without charger and cable — Price: 3999RMB
• “Combo” Edition: with charger and cable — Price: 3999RMB

It is “Well-designed”!

1.It shows respect to its customers

Xiaomi is giving its customers options. If you still need the charger and cable, there you have them. If you do not, then you are encouraged to choose the standard edition.

Compared to Apple on this and so many other things, this is respect to customers.

2.It takes care of the actual needs of its customers

Environment-friendly or not, will people still need chargers?

Absolutely!

Chargers do break, get outdated or simply get lost.

What’s more, the latest charging technology mostly still has hardware requirements for customers to enjoy the best charging speed.

And Apple should be particularly aware of that.

Older generation iPhone chargers came with USB ports, but the cable of iPhone 12 series comes with USB-C connection. 

So how can Apple customers reuse their chargers?

When there are 100 millions phones in the market and only 50 millions usable chargers, something is wrong. 

People either need to buy cables or chargers.

With Xiaomi, if you need them, you have them.

3.It leaves the sense of “Honor” to its customers

Protecting the environment is a good thing and should rest on everyone’s shoulder. 

However, being forced to suffer losses for the sake of the environment does not exactly make people feel comfortable, even if that is the right thing to do. 

This whole removing charger thing from Apple, how much of that is from environmental perspective and how much of that is from business perspective, I am not sure.

But in general, no one likes being forced.

Xiaomi’s options say if you would like to contribute to the protection of the environment, please order the “Standard” edition. You do not save money, but you have done something for the greater good.

If I do not need the new charger or cable, I would order the “Standard” edition. 

Everyone has the desire and willingness to do good. Me too! 

And most importantly, it is my conscious decision and I feel the sense of “Honor” in doing that. 

Furthermore, it might even inspire me to do more for the environment, such as being more mindful with recycling, which the government is encouraging with free recycle bins and all.

Brilliant, Xiaomi!

4.It takes away of the feeling of “Loss” from its customers

Traditionally, phones have always come with chargers.

When it is taken away, people perceive as losing something they already have, which triggers the “Hate of Loss”.

Xiaomi takes it another way around. 

If you want it, you get free charger and cable. So instead of “Losing”, you “gain” free staff.

Smart marketing tricks!

5.It draws more attention to the charger

You get the charger for free in a separate package, which naturally draws more attention to the charger.

And it is not just any charger. It is GaN charger!

What is GaN? I have absolutely no idea at all!

But I noticed it. 

What if it is just a charger that comes with the phone inside the same box? No one would even look at it even if it is also GaN.

This is marketing! Xiaomi could offer the same chargers for the open market and even for other phones.

After a quick search, I got to know that GaN is a type of material that produces less heat. 

What if Xiaomi chooses a more environment-friendly material next time? Would that become the new standard? Would that not contribute more to environment?

Again, Brilliant!

With this kind of “Customer-Friendly” brand image, combined with extreme cost and performance optimization, it is not hard to believe that Xiaomi will continue to grow both in China and abroad.

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Photo by lin qiang on Unsplash

The Rise of Chinese Brands

If we look at the grand scheme of things, Chinese Brands, like Xiaomi, are taking more and more share of the mobile hardware market. 

In China, as early as 2014, Xiaomi already overtook Samsung as the #1 brand. And till today, the only significant non-Chinese brand in the market is Apple. Samsung share is well below 1%. It is now a blood bath between Chinese brands.

In India, top 5 brands are all Chinese brands, except Samsung which ranks 3rd.

In Europe, top 5 brands are all Chinese brands, except Apple and Samsung. With Huawei ban, Chinese brands have a tougher way to go. However, declined Huawei sales is mainly being taken up by Apple and the other Chinese brands, not Samsung, which was a bit surprising to me.

Looking at the world overall, it has long been a battle among Apple, Samsung and Chinese Brands.

Actually, Huawei briefly overtook Samsung as the World’s #1 brand in terms of volume shipped in Q2 this year, before the impact of the ban really kicked in.

Going forward, the blood bath within the Android segment is only going to intensify, with Huawei, Xiaomi and Vivo all rushing to the high-end segment which Samsung used to dominate.

Apple will still occupy the best position for the years to come! 

But Chinese brands will probably continue to rise and will be probably the most interesting group to observe in the years to come.

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Photo by Markus Winkler on Unsplash

The Rise of “Made in China”?

Will the rise of Chinese brands in mobile hardware market be somewhat a signal that we will eventually see the rise of “Made in China”?

I do not know, but I have a logic argument to support it.

Mobile hardware industry is very competitive and rapidly changing. It takes as short as a few years for the dominating player to change. Just think of Nokia.

The pace of change is far quicker than the traditional “Made in China” industries.

This is a key characteristic, because it allows new players to quickly come up on top.

In traditional industries, it will take much longer for new players to obtain the dominating position. 

So maybe “Made in China” is still on the way to rise. It simply needs more time.

China opened up a little over 40 years ago. Compared to 100+ years brands in the west, Chinese brands are very young and are still catching up.

It could be eye-opening to look at the corporate landscape in 10, 20, 30 years.

Till next time!

Why “Sunk Costs” still sink people?

 

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Dear Readers,

Thank you for coming here!

It is quite common that people still make bad decisions because they cannot let go of “Sunk costs”. 

I am the living example. I still feel very very bad due to my career set back this year. Sometimes, the feeling was so strong that it shows on my face and affects my efficiency in getting things done.

Another well-known scenario is as follows: if you bought a movie ticket to a bad movie, will you just leave half way? 

I do not know about you, but I probably won’t…haha

Photo by Natasya Chen on Unsplash

So the problem here is why we just cannot let go of the “Sunk Costs” and move on, even though we know we should logically.

It would be lazy to just say “Knowing is oceans apart from doing” (I will do an entry on that later).

So I really thought about the “why”. And I now think there might be two reasons that are deeply linked to our nature as a human being.

1. Fear of losses

Compared to the same amount of gains, the emotions triggered by losses are twice as much.

That means the joy we get from gaining 1000 dollars is only half of the suffering we get from losing the same amount of money.

So people hate and fear losses.

“Sunk costs” are gone by definition. 

But if we turn away from it, it would mean that it is really “lost” and becomes actual “losses”. This is obviously just some mental games. It is lost already.

2. Fear of being proven wrong

I struggled a bit between “Fear of being proven wrong” and “Fear of being wrong”.

I decided to use the former. 

Maybe people are ok to be wrong and preferably correct themselves “quietly”. “Quietly” means that they do not even realize it themselves. This way, no explicit emotions are triggered.

However, “being proven wrong” represents a logical and conscious conclusion, which will trigger emotions.

So people are more afraid of “being proven wrong”.

And making a conscious decision to give up the “Sunk Costs” proves people wrong, even if that is the right decision to make for themselves.

These two “fears” are closely and deeply linked to our human nature. They are hard to defy and thus “Sunk Costs” are hard to let go.

However, there are ways in which we can increase our chances of success.

Photo by Stillness InMotion on Unsplash

1.Understand “Sunk Costs” are not costs

Costs are forward looking.

Costs are something you need to give up moving forward.

“Sunk Costs” were incurred in the past. We do not need to give up anything going forward.

So “Sunk Costs” are not costs.

To make the right decision, we need to consider the real costs, which leads us to the second point.

2.Consider the “Opportunity Costs” 

“Opportunity Costs” are the real costs.

It is the value of the best alternative we have to give up by making a decision.

If we decide to join a company, we are giving up the growth and wealth brought to us by other companies;

If we decide to marry someone and spend the rest of our lives with him/her, we are giving up the companionship of anyone else in the world;

If we decide to watch a movie tonight, we are giving up the joy and influence of any other movies.

So this is what will make a meaningful distinction to our lives going forward.

Hope we all make as many good decisions in our lives!

Till next time!

Monthly Net-Worth Update — Dec 2020 — Great Month but not by me

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Dear Readers,

Thank you for coming here!

We are so close to 2021!

2020 has been a Year of Challenge for many. I hope 2021 is going to be better for all of us. 

Just hang on and we will be there in a bit!

Here comes another update of our Net-Worth.

It is a great month, mostly not because of me!

Net-Worth increase from last month: 59.67K SGD, 0.35KG Gold

It is a big increase in monetary value.

Actually, it is the 2nd biggest monthly increment so far, just below Jan this year, which we had an increase of >70K (light before the tunnel..haha).

The increase was mainly because we finally took stock of our net-worth covering all our accounts, taking into consideration the investment returns made by my wife, as promised last month. 

She has made more returns in a single year with much less capital than I have made in the past 2.5 years and with most of our investable net-worth.

I took the lazy approach to DCA into broad ETFs (well, execution was a bit off) while she learned from some coaches and took a much more active approach.

It is not to say the active approach is better. I think it depends a lot on how the market is doing. But it did prove the alternative might also work.

I am happy that my wife made good returns. Otherwise, our situation would have been much worse. 

The increment in GOLD was low, compared to last month. This is due to increase of GOLD prices this month or rather the huge drop of GOLD prices last month.

I know you might be wondering where my salary went. 

First of all, it is not a lot and it is a painful reminder to stay that how much a loser I have been. Secondly, it mainly went to the renovation cost.

Again, hope 2021 is going to be better for all of us. Hell! We are going to make it better!

Investment: 4.20% annualized return, incl. dividend

Compared to last month, it is a slide dip. 

This does not include the returns of my wife. I have decided to keep it this way. 

It does not make sense for me to track all her transactions. Furthermore, I do not understand her logic in those transactions. Therefore, even showing the numbers won’t be of much help for me or my readers.

So this number will just reflect the investment made by me here.

We are still thinking about how to approach the investment in the new year. I will report continuously here.

Again, have a good break and lets rock in 2021~!

Till next time!

Merry Christmas!! - Don't be angry; Don't be idle

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Dear Readers,

Thank you for coming here!

I have planned to post the next episode of "Good Employee" series today. However, it is Christmas and maybe something lighter would be more suitable,

Hence the below quick and easy read. 

Hope we all have a good rest, not just doing nothing!

Unpleasant things happen in life almost all the time. No matter how much we want to avoid them or how far we go to avoid them, they will happen to us.

Now that is inevitable, I offer two pieces of advice for us to feel better and be more productive.

---

1.Don’t be angry

Being angry is one of the worst ways to waste time.

Being angry is punishing ourselves with other people’s mistakes or things out of our control.

Being angry does not solve any problems and only shows how weak we are because we care too much.

People with a goal and motivation do not have time to be angry. Anger is the among the first things to be casted aside in their priority lists.

They either ignore the problem, solve the problems or get away from them.

2.Don’t be idle

Staying idle not only is a waste of time, but also opens doors for bad emotions, including anger and illusions.

Always try to be productive.

You may argue that we need time for rest and deep thinking.

We need to distinguish:

a) Rest vs Doing nothing

Rest refreshes and prepares us for the next productive phase. It could be doing something we enjoy and something that allows our mind and body to recover.

Doing nothing, on the other hand, hurts our performance in the current and next phases. It could be sitting like an idiot feeling so depressed and angry. 

Just simply judge based on the impact on our readiness for next phase.

b) Deep thinking vs Illusions

Deep thinking has a goal, follows logic and reaches a conclusion, even of that conclusion is inability to reach a sensible conclusion yet.

Illusions are fantasies, probably just to help people get away from reality and feel better. It shows weakness and lack of courage against the hard and cold reality. 

It could be helpful in some extreme cases as an extraction. But it will do much more harm than good if people are not careful and get trapped in it.

---

Life is a bitch and sometimes come down on us without any reasons.

Let’s manage ourselves, take actions and make a difference at least in our own lives.

Till next time!

Do not forget your tax relief!

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Dear Readers,

Thank you for coming here!

It is a few days to the end of 2020. 

And it is high time to secure your income tax relief if you have not done so.

Unfortunately, I wont be needing it this year.

But for you, a dollar saved is a dollar made.

I wrote below post "Last chance to secure your income tax relief for 2019" about a year ago and things are the same for 2020.

Do spend a few minutes to think about it and make the transactions before 31 Dec 2020 to save your hard-earned money.

Happy Saving!

Till next time!

How to be a good employee (10 times the salary in 10 years) — Part 2: Stay independent

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Dear readers,

Thank you for coming here!

This is the episode 2 of the “Good employee” series.

Instead of talking about several points in the same category as I did in episode 1, I would like to focus on only one point in this post, which came to me recently as really fundamental.

Stay independent in your work.

This should come before all skills and techniques.

Photo by Miguel A. Amutio on Unsplash

Let me share my experiences first.

1. A Good Start

As a young kid, I was quite good at staying independent.

It was easy for me to resist lures, such as snacks, little secrets etc and intimidation, such as threatening.

I just did not like the idea of being someone’s “puppy” and running around following someone. I would rather play alone.

On the other hand, I did not enjoy the feeling of being the “boss” either.

So, growing up, I did not really have any close friends.

I was ok and sometimes even proud of it. 

When I thought back, the reason I was able to do that was because I did not really have much “desire” or “fear”. 

No extra snacks or not being part of a big group did not bother me much.

I did not need to worry about “bullying” either, partly because my mother taught in the school.

Instead, I had confidence.

I was able to convince myself that getting good at studies was the most important thing and I had the stronger ability to achieve that than most of my classmates.

Also, because my parents both had degrees, I knew more things about the world than most of my classmates too. 

So overall, I was confident and perceived certainty for the future.

Photo by Roger Bradshaw on Unsplash

2. The "Uphill" Battles

Then I started a series of “uphill” battles: from village schools to town schools to city schools to university in China to Singapore.

Every time I got “upgraded”, I transited from being the “top” of my class to being the “tail” of the new class, simply because the resources available in new schools were so superior.

I told myself it was not my fault but I needed to catch up to show everyone that I was at least as good as them, if not better.

I kept succeeding through hard work. Given time, I could always rise to being among the top of the classes, which earned me respect and re-enforced my confidence.

Until I came to Singapore.

Very quickly, I realized the huge gap between me and my peers. And on the other hand, there was so much “freedom” and there were so many things to worry about.

Take badminton for example. I participated in the selection for my hall team and shockingly found out that some other participants played for Singapore in international games.

And the environment changed significantly as well. 

There was no need to get full marks any more, because A was the best you could get anyway. And there was no teacher to monitor my studying hours.

And I needed to learn so many other things just to look “normal”, like how to place order in McDonald properly. It took me 5 or 6 “embarrassing” experiences to figure that out. 

With a almost impossible target in front and all the “freedom” and daily “challenges” in so many aspects, I felt exhausted and “lost” for quick a bit, lost much of my confidence and decided to “enjoy” myself.

In a way, I am really thankful to the China education system. With as many flaws as it has, it allowed me to focus on that single goal — getting good grades. If not for it, I might have lost myself much earlier in the “Uphill” journey.

Anyway, in university, I indulged myself in movies, games and parties. For a long time, I thought this was life!

By the time I realized that school would not last forever and there was something called “middle-age crisis”, it was already the 2nd semester of Year 3.

And soon, I realized the goal was so far away. What’s worse, I had lost many of my “good habits” and lost even more confidence.

So after a “wasted” few years, I was dragged back to reality, which seemed even more harsh.

Photo by René Reichelt on Unsplash

3. Lost without knowing

From that moment onwards until now, it has been another “Uphill” journey.

The difference is that, this time, I no longer have a clear goal that I am willing to go all out for and I set out with low confidence.

So I gave up the insist of staying independent (I do not know exactly when or where or which incident). 

Sometimes, I guessed or even “analyzed” what my managers or colleagues wanted and engineered my approach accordingly. 

Sometimes, I kept silent even though I knew the plan could be improved.

Sometimes, I even followed blindly because the other party helped me in other occasions.

…

It felt easy then. 

But now, I could clearly see the “Price”.

1. I limited the possibilities to learn. Sometimes, people would tell me to stay away from certain things. And when I listened, I lost the opportunities to learn.
2. I lost my “importance” with certain people. People always value what they do not have. Someone who always follows is what they think they “have in the pocket”, will assign less weight to and care less about. They might be “spoiled” to a point where they would feel surprised and angry if I try to be different. 

Photo by Blake Weyland on Unsplash

So how do we avoid it?

We need to realize and be convinced that taking the hard path is really the only path. It is not like we have a choice.

The reasons for my losing of independence are really just as follows:

1. I want something I do not have
2. I am not confident I will get it soon enough just relying on myself
3. I fear that I might even lose what I have now

So equipment ourselves with below mindsets to take the hard and only path:

1. Reduce “wants”. Recognize what we really need. There is no need to do things we do not enjoy to get things we do not need.
2. Fight “fear”. Reality is harsh and even cruel. But fear will not help us. Bravely facing it and fighting it is the only way. On the other hand, stop to really think about the consequences and most likely we will realize that they are not as bad as we think.
3. Lose “illusions” and “false hopes”. Relying on someone or even a system is always risky. When there is no clear logic and path to deliverables, it is pretty much guaranteed “illusions”.
4. Realize the limited value of “dependence”. We may not get what we are fighting for or even lose what we have now, but losing “independence” is not certain to help. What is certain, however, is we will become less significant and valuable.

With the right mindset, below are some actions to start with:

1. Be honest with ourselves. We are just as valuable as any other person and our feelings are equally important. We do not need to satisfy our own time, energy and feelings to “help” others. So before we say "Yes" to others, make sure we do not feel “No” inside.
2. Establish boundaries. Be firm to establish boundaries. This is mutually beneficial in long-term relationship. The worst case is “explosion” type of conflicts when one party finally decides “I have had enough”. In this sense, it is our responsibilities to establish boundaries.
3. Leave no room for ambiguity. Do not allow people to make empty promises to you. Ask for timeline and how he plans to deliver it. Even if it is bad news, it is better to know it and deal with it earlier rather than later.
4. Improve ourselves like “there is no tomorrow”. This is the most fundamental step to ensure independence. Sufficient capabilities and options will boost our confidence and reduce our fears and enhance our happiness. And the only way to really learn is by facing the harsh reality and solve the real problems.

Till next time!

One Year Old and Big Thank You!

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Dear readers,

Thank you for coming here.

The first post in this blog was on Dec 13th 2019. We are 1 year and 5 days old!

How time flies! And I am super glad to have you as my reader for the past year.

Photo by Priscilla Du Preez on Unsplash

In 2019, I thought about starting a blog several times. However, I always got the reason to delay it.

Until Dec when I was about to be jobless due to the offer retraction, I finally took the leap and never looked back.

Funny enough, I started my investment journey when the markets were near highs and experienced a correction shortly after.

And I started this blog at the low point of my life. 

Nevertheless, I am going to keep doing both for the long-term.

Photo by Austin Neill on Unsplash

Thinking back the painful experience of this year, this blog has helped me a lot and provided me a way to express myself. 

And the comments and encouragements from you, both online and offline, mean a lot to me.

Thank you very much for taking interest in my life and staying with me for the past year. 

And I sincerely hope this blog has provided a little help to you as well, even if only emotionally. This year has been tough for a lot of people.

Photo by DJ Johnson on Unsplash

Going forward, in order to connect with you better and hopefully be more helpful to you, I plan to implement below changes to take the blog further:

1.Topic: More on money and my own experiences

Looking at the analysis, posts on money and my own experiences tend to get more views, indicating more interests from you. 

I will post more on these topics.

On Money, I will resume my capital injection into stock markets after my recovery period (I am in the process to get things in place) and I will report my transactions here. If the community mentioned in my previous post can materialize, that would be even better.

On my Experiences, I will share the happenings in my life and my learnings and thoughts, for your reference. Hopefully, they can help you make better decisions and avoid pitfalls.

If you have topics you would like me to write more, do let me know and we will see how to work something out.

2.Frequency: 3 posts a week

I think more posts could be more helpful to you.

From the start of this blog, I have been doing one post per week. The main reason was to avoid over-promising and eventually hurting my abilities to continue this blog.

However, more often than not, I can gather more than one topic to write about over the course of one week. 

I have to pick one of those topics. And some of them end up staying as draft forever.

So doing more posts will allow me to share more of my thoughts and experiences with you, for your reference.

In terms of keeping the commitment, I have tried for two weeks to complete 3 posts a week. I think I am able to keep the pace. 

So I will publish 3 posts a week going forward. 

You can check back more often for new content.

3.Format: Shorter and easier to read

I get feedback that some of my paragraphs elaborate too much and make the article harder to read.

I will try my best to be brief and accurate in my future posts. Though I think it will take some time given my language capabilities and writing habits, my efforts will continue on.

4.Google Ads: Cherry on the cake

You may have noticed that I turned on Google Ads in this blog. To me, it is cherry on the cake.

I will not do the blog for the Ads revenue, but it is a good reminder that my efforts deliver value to others and are appreciated.

So if you see an ad that interests you, please do click and check it out. It will help me a lot!

5.Future: Let the bullets fly

Regarding the future of this blog, I have no vision at all, unlikely most of the projects I do.

So I will just let the bullets fly for a while.

If you have some thoughts, I would deeply appreciate and we can build this blog together.

But I believe we are off to something good. 

Not because I believe in myself, but because I have confidence in my readers.

I posted my previous entry “Will DCA into ETF still work in the current market?” around 00:30 and when I checked this morning, there were over 50 views before 8am, which means a significant portion of my readers are earlier risers and learners.

That alone gives me confidence. I will do a separate entry to elaborate why “getting up early” is enough sometimes to grow a whole new self.

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Again, a BIG THANK YOU to you. Please do share this blog if you know someone who might benefit from it.

Till next Birthday!

Will DCA into ETF still work in the current market?

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Dear Readers,

Thank you for coming here!

I listened to a sharing earlier this week about money. Among the guests are Adam Khoo, a few seasoned private bankers, fund managers, business owners and, last but not least, a CIO managing multi-billion assets.

The sharing provided quite some insights regarding investment and the current markets. 

I would like to share them with you in this post.

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1.Regarding DCA (Dollar cost averaging) into ETFs

While experts still think DCA into EFTs are generally a good way of investing for completely passive investors, they do have some concerns.

For ETFs, the experts are not simply into world ETFs. They are looking at ETFs in certain industries or segment, which totally makes sense as they are professionals.

For DCA, the discussion became very interesting.

First of all, they all reflected that individual investors seldom had the discipline to stick to DCA. 

From my own experiences, I shamefully support the statement. 

I always tried to time the market when it was time to DCA, hoping to get a slightly better price by waiting for a few days or months.

Secondly, one expert reminded that instable cash flows also limited people’s capability to stick to DCA. 

Again, from my own experiences, I shamefully support the statement.

I always thought I was conservative in the DCA amount until I became jobless. The assumption that things will continue going well limited my investment into risk management.

Thirdly, another expert suggested to join a community of like-minded people to utilize the peer pressure/encouragement to stick to DCA, which was quite refreshing. 

Even though he was pitching his services, this could be a very good way to maintain financial discipline, not just DCA.

If you are already part of a such community, congratulations.

If you can find your friends and relatives to form such a community, I would suggest you do so asap.

If you are like me, neither in a community nor having the network to form one (or simply do not want to discuss this kind of matters with your current network for whatever reason), please leave a comment below. If there are more than a few, I can start a community and see how it goes.

2.Regarding the current markets 

[Disclaimer: below is based on my understanding only. Please read on your own risk.]

The market is a bit expensive now and wealth preservation is getting popular.

Suggestion to “what to do now” was to find out what you wanted first. (Whatever that means)

3.Regarding mistakes and lost opportunities 

Everyone makes mistakes, no matter how good they are.

In Apr-May this year, when markets started to recover, very few people were bullish about the market then. 

Even the CIOs of many reputable money managing giants were bearish and instructed their bankers to tell their clients to stop buying or even continue selling. 

A few bankers were rumored to be “F”ed by their clients.

So even professionals make mistakes, we, individual investors, should not be too hard on ourselves.

Photo by Herman Delgado on Unsplash

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So after the sharing and thinking back my own experience, I have decided to be more conservative in my investment:

1. Cut down the DCA amount when I resume it (I have not re-started it since I stopped about one year ago, but I think this is still my approach going forward). 
2. This will allow me to accumulate a war chest over time to prepare for the unexpected or even better to invest lump-sums when the markets go down. I need to overcome the anxiety I have when I have cash sitting idly in bank accounts.

Hope we all become better investors!

Till next time!

The most incredible form of “Compensation”

 

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Dear readers,

Thank you for coming here!

How does a gym make money and survive?

We probably all know someone who signs up for gym membership and never turns out after the first few sessions. Maybe some of us are that someone!

Exactly, this is how gyms make money and survive, relying on people who pay for services that they do not fully consume.

I knew this a long time ago and it gave me one more excuse not to exercise. However, I never really thought about it further until recently.

This is probably the most incredible form of “Compensation”. 

People who never turn out in the gym after the first few sessions are “compensating” those who do turn out fully or almost fully.

Without the former, gyms would need to charge a much higher membership fee or other costs to survive.

This is incredible because it “rewards” people who persist and “punishes” people who do not in a way that is even not noticed by most people involved in it.

People who go to gym more often would not feel that they own it to those who come less often. 

And similarly, people who turn out less often do not think their batchmates need to thank them for their “contributions”. Instead, they blame themselves for lack of commitment.

This is probably the most incredible way for the world to reward people who persist.

For people who are less persistent, they do not need to feel too bad either, because they are doing “Real Charity” to make the world a better place.

It is “Charity” because they do contribute to the survival and thriving of the “Gym” industry. Without them, even if “Gym” industry can survive, it may be only catered for wealthy people.

It is “Real” because the “contributors” do not expect any returns (Sign…they probably do not even know they are doing it). Charity does not get more “Real” than that.

Photo by Alfons Morales on Unsplash

You know what is more “surprising” and maybe “terrifying”?

This kind of “mechanism” is much more common in life than we think.

1.Books

There are two types of people who buy books: those who read learn and those who do not contribute to “Charity”. 

Reading is not as “enjoyable” for most people as some forms of entertainment, such as TV, gaming etc.

So only relying people who read books they buy will seriously limit the development of the industry and increase the prices of books.

The industry needs people who do not read a lot to buy a lot of books.

2.Subscriptions

Have you been paying for subscriptions that you do not even consume, such as TV, music, magazine?

If you do, you are doing “Charity” and you are needed by the industry.

No need to hurry to cancel them, because you are part of the reason why the subscriptions are so cheap.

3.Extra staff bought during “11.11” sales

Did you buy any extra staff you do not really need during the sales festival because they are so heavily subsidized? 

Again, you are probably part of the reason why those subsidies are possible.

Photo by Mika Baumeister on Unsplash

It also exists in business world.

4.“Sharing” industry

“Bike sharing” took the world by storm two or three years ago. 

And people invented all sorts of “sharing” based on the same concept, as ridiculous as “umbrella sharing”.

Tons of investment was pouring into the market as if they are “free”. Every player was burning tons of cash building their customer base, brands, employee capabilities, products, downstream and upstream supply chains etc and etc.

For those players who exited earlier, willingly or not, it was game over for them.

But for those who “persisted” longer, they got “compensated” with abundance of “almost free resources”, such as trained customers, tested business models, skilled employees, invested suppliers etc and etc.

In some cases, they even did contribute to the “traditional Charity” as we know it.

In Singapore, thousands of refurbished “shared bikes” were shipped to Myanmar to help the poor school children in their commute from home to schools.

I am sure there are more such examples both in life and business.

Photo by Aaron Burden on Unsplash

In a summary, if you really want to achieve something that is not “obviously wrong”, stick to it and you may take advantage of the “compensation” in time from those who quit to succeed.

Till next time!

Defining “Financial Freedom”

  

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In my below post, I have talked about how much money is needed to achieve “Financial Freedom”. 

How much money do you “Really” need to be completely “Financially Free”?

That was targeting “Luxury”. If we hit that mark, we are for sure “Financially Free”.

In other words, we were kind of talking about the upper limit of the requirement for “Financial Freedom”. After we have achieved that mark, there is no reason for us not to declare “Financial Freedom”.

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Today, I would like to talk more about the lower limit, exceeding which we can call ourselves “Financially Free”.

To be free, we need to have the resources to lift the constraints of life.

So what are the constraints of life?

To quote a Chinese saying, Birth, Aging, Health, Death, Clothing, Food, Accommodation, Travelling (including commuting, vocation etc) [生老病死，衣食住行]

I am going to split them into 4 categories:

1. Birth, Death
2. Clothing, Food, Travelling
3. Accommodation, Health
4. Aging

 

1.Birth, Death

These are hard constraints under the current circumstances. 

We cannot choose our parents. We cannot prevent death. 

So just accept it.

In other words, there is no so called “Freedom” regarding Birth and Death. 

The only way possible is spiritual, to be “Free” of the worrying and the thoughts of pursuing “Freedom”.

2.Clothing, Food, Travelling

This is the pre-requisite for us to be “Financially Free”. Good news is that the “Freedom” here is relatively easy to achieve.

This depends a lot on individual requirements and perception. 

For some people, when they have a Toyota, they would want a BMW; and when they have the BMW, they would want a Lamborghini. For them, “Freedom” is a myth.

For me, the bar should be when we feel comfortable and relaxed about what we have.

We will not need to struggle when we or people we care really want some slightly expensive items occasionally. We have enough resources to buy them.

3.Accommodation, Health

This is the hard part.

Accommodation represents the single most expensive item for most people. 

Health could be a bigger problem. 

In China, there has been a statement: The health costs for the last 10 days of people’s lives outweigh that for the rest of the lives.

Battling with death is expensive, but it is so hard to let go.

Therefore, in order to have a good retirement, we need to look at the sources of income in retirement.

a) Pension (aka CPF)

b) Rental income. One real estate property may not even be enough.

c) Ownership of good business. For most of us, we do it through stocks. Take STI for example, ~3% dividend will give us 100K SGD each year for an investment of 3–4Million SGD. That should be enough for a decent life.

d) IP. For most of us, this is not applicable.

4.Aging

Aging adds a whole new dimension to the equation and a whole new level of complexity to the problem!

1. Time-span for our planning: We cannot just plan for now. We need to plan for the days to come. Do bear in mind that the life expectancy has been rising.
2. The contribution to and from our parents: How much we need to help them and how much they can help us.
3. The contribution to and from our kids: How much we need to help them and how much they can help us.

But it is not all bad.

Time-span gives us the time to grow our investment and wealth.

Our parents can help us in our initial phase of the journey.

Our kids can help us in our retirement. 

For the latter two, the emotional value is irreplaceable.

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All in all, “Financial Freedom” does not come easy. 

But it is achievable, even for us common folks. Just plan properly, work hard and stick to the plan!

“Success” is also the mother of “Failure”

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Dear Readers,

Thank you for coming here!

There is an old Chinese saying: Failure is the mother of success.

This saying is among the most frequently used quotes to encourage people to keep faith and never give up.

It also carries sound logic because failures allow us to learn and improve and therefore set the basis for success. Many would argue that failures are the best means of learning.

However, it recently came to me that the reverse is also true.

Success is also the mother of failure.

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Success makes people confident. And many successes make people arrogant.

The more successful people are or they think they are, the more they intend to attribute the success to themselves and ignore the impacts of platform, macro trends and even luck. 

This inevitably makes the vast majority of people arrogant. And they start to ignore and even look down upon the factors that made them successful in the first place: rules of how the world works, human nature, laws of physics and even common sense.

What follows is inevitable failures. And the more successful they are, the harder they fall and the harder it will be for them to get back up.

This is also sound logic. And I believe it is also well-known.

But “Knowing” is oceans apart from “Doing”. (This is another topic I will elaborate in future posts.)

People who can avoid this vicious cycle are so few that there may be only a handful of them across the entire 5000 years of Chinese history. 

People who fell into this cycle are everywhere, ancient or modern.

From Internet

Jack Ma is probably the latest example.

On Sept 10, 2019, the Teacher’s Day in China and 20th Anniversary of Alibaba, Jack Ma “retired”. 

At that time, it was super well received. 

More than a few opinion leaders in China expressed their praises: Jack Ma successfully retired as such a successful entrepreneur, which would take tremendous wisdom and discipline to accomplish. They envisioned “good ending” for him.

About one year later in 2020, Jack Ma gave a speech that was seen to be “out of place” and then Ant Group was cancelled from going public.

Rumors are that Jack Ma’s condition is tricky or even risky.

Photo by Spencer Davis on Unsplash

Most of us will succeed and fail more than once in our lives, no matter how small those successes or failures are.

This is just life.

To make the most out of our lives, I think two things are clear：

1. The experiences of success are invaluable. It is better to set out to succeed and then fail than never trying, even if we end up in the same place.
2. We just need to succeed one more time than failure. Even if we cannot, as long as we have tried our best, there should be no regret. Passing a certain point, successes or failures will carry less meaning than life itself.

Till next time!

Quick updates

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Dear Readers,

Thank you for coming here.

I would like to provide a quick update on my status in this post.

I have started work. For sure, there were people who laughed at me. Luckily, there were people who welcomed me as well. I consider this less important now because I have already given up all the “faces” when I decided to accept the offer.

I refinanced my property loan from HDB to Bank loans to enjoy the lower rate, something I could not do without a job.

I still suffer from emotional “rollercoasters”. I took the causes down as they happened.

• Anger with myself and self-blame — I keep thinking about What-If’s and there are a lot of what-If’s given the 7 or 8 wrong decisions involved. As illogical as it is, it seems “sunk costs” do have the power to sink people.
• Tangible losses — Serious setbacks. And worse still, I do not have a clear way to make up for it.
• Morale issues of others — Not any wrong-doing. I am naïve and trapped in my “illusions”.
• Colleague reactions — less important, still bothers me.
• “Lucky” people — I know I should be happy for them and I am. But it just reminds me of my status and “bad fortune”

I know I cannot afford to let emotions take too much control. I am giving myself time to recover. 

I am on the way to acceptance.

Till next time!

Monthly Net-Worth Update — Nov 2020 — Good Month

 

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Dear Readers,

Thank you for coming here!

Time flies! It is already the end of Nov and we are one month from the end of this remarkable year — 2020. 

So another update of our Net-Worth.

Overall, it is a good month. STI finally showed some color!

Net-Worth increase from last month: 24.07K SGD, 1.2KG Gold

The increase is mainly due to the recovery of STI and the bonds we hold.

The currency exchange rate fluctuation is mostly offset as we have both US and China assets.

Investment: 4.63% annualized return, incl. dividend

Compared to last month, it is huge improvement. This is the highest for us since March this year.

Stock market is a bit crazy lately due to US election and vaccine. However, I have concerns about the stock market, especially the developed markets. So I might focus my capital injection, if any, on Asia markets in the near future.

Just my two cents for your consideration.

We plan to do a re-cap of our Total NetWorth for Dec. So stay tuned!

Till next time!