Monday, December 21, 2020

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

Photo by Gautam Krishnan on Unsplash

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!

Friday, December 18, 2020

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.

Photo by Phil Desforges on Unsplash

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?

Photo by Jamie Street on Unsplash

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.


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

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!

Thursday, December 17, 2020

The most incredible form of “Compensation”

 

Photo by Ben White on Unsplash

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!

Tuesday, December 15, 2020

Defining “Financial Freedom”

  

Photo by Kristina V on Unsplash

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”.


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.


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!

Monday, December 7, 2020

“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.

Photo by Kelly Sikkema on Unsplash

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!

Thursday, December 3, 2020

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!