Archive for category: Personal Finance

Being financially successful can have different meanings to different people. For some, it could mean being extraordinarily rich. For others, it could simply mean getting out of debt and gaining financial confidence.

Whatever your specific financial goals are, I guess no one will reject the idea of financial security. For someone is not so good with money like myself, there’s still hope to be financially successful with just a few simple changes in mindset and spending habit.

Are you like me in the following ways?

• Buy something and don’t realise you already have it at home.
• Rarely use or open the things you buy.
• Shop online when you are bored.

Or you are in debt. You are on a low wage. You think you are useless with money.

If you’ve said yes to a lot of the above, fear not. As long as you are open to learning and think about why you are spending, you can still be financially successful.

In order to achieve financial success, you have to know what your financial goals are. Your goals should be based on your current financial situation and be realistic. Don’t dream. Be practical.

Here are 10 ways to be financially successful

1. Find out exactly how much your are earning and spending every day, week, month

It sounded so basic right? The truth is most people under estimate how much they’d spend. Record your daily spendings. Gather all your receipts, credit card and ban statements. Keep daily accounts of what goes out and what goes into your accounts. Guess work won’t do it. You must know how much you’ve got to spend and keep to start with.

2. Check your bills and statements

Check everything you’re asked to pay, from credit card statements to grocery bills. Look for over charing and general mistakes. Who know how much money you could be losing buy not keeping an eagle eye on your account. I’ve lost thousands by not checking my credit card statements.

3. Start saving now

Most of us can save money if we simply cut back on non – essential expenditures. Some simple ways of saving include: Cancel gym membership if you don’t go more than once a week. Go out only once a week to eat. Eat breakfast at home. Don’t shop when you are bored. Buy a water filter instead of keeping buy bottled water.

4. Think before you spend.

Think about what your are buying all the time. Made spending hard. Rat everything you want to buy and only buy what you need or something you really, really, really want. Ask yourself: how much do I really need/want this? Buy the absolute essentials. If it’s something you really want than really need, sleep on it and reassess your desire later. Very often, you’ll find that you actually don’t want it that much after a couple of days.

5. Shop smartly and delay gratification

Don’t be a sucker for brands. Instead shop around for bargains. The richer you want to be, the more you have to delay gratification. Of course you need to maintain certain standard of living to be happy. But you do have to cut back, save and do without luxuries in order to have money to invest and therefore, have money further down the track.

6. Invest wisely

As tempting it may be to dabble in the stock market., or give your money to someone who says they can triple it in two weeks, remember it’s impossible to get rich quick. Unless you can afford to lose money, only take sensible risks with your cash.

7. Don’t give up your day job

Don’t be so quick to put your job on hold for a career break. Move to a less stressful job for less money. Or quit your job to travel round the world thinking you can always slip back into the job market. While these are all options that can work, the reality is that what you earn today may not be what you earn tomorrow. I’ve learned this in a hard way. So if you have a great job with a good earning potential, think long and hard before changing careers or taking a career break, and ask yourself whether you will financially regret it in five – ten years’ time. If the answer is “maybe”, think again. Think really hard about what you’re doing.

8. Protect your money

Pay attention to what’s happening to the financial market. Do you need to move your money around to make it work better for you? Or take your money out of something that’s losing money? Or change jobs because your current company is not doing well? Always look ahead for potential financial hazards that might knock you sideways, so that you can sidestep them before they happen.

9. Don’t put all your eggs in one basket

Don’t put all your money into savings account, share market or properties. Diversify in different investment streams. Properties, for example, is a great investment, but what would you do if the market crashed? Have you made provisions for your own financial security? If not, it’s time to do so.

10. Make the most of your spare time

We all have unused skills that others could benefit from, whether they are a talent for painting, making things or writing. You would be amazed at how many people make money form the things you take for granted. Research and see how others make money. Consider offering yourself out for hire. Get a second job! The fastest way to get rich is to increase your income by utilising your spare time. Think you have no spare time? Well, think of all the time you spend browsing on your smart phone.

I almost totally abandoned my blog last year. Instead of posting regularly, I had very few posts in the entire 2019. Not much thought and effort were directing to this space and it looked sad.

I had no energy for anything else. I was physically and emotionally drained day after day after my slavery, low paying contract job (got that half way through 2019). Why am I going for a job like that? It’s kind of complicated (more on that later), but one of the main reasons is that I want to teach myself a lesson, to teach myself the value of money.

It’s fair to say that my intelligence in money management is really low. I have a Master’s degree in Finance and looked after big company’s finance department but my personal finance has always been neglected. It’s with regret to admit, I never treated money with care.

In the light of a new year and new decade, I thought it’s time to lay out some of my biggest money mistakes in years and try to learn something from them.

Leaving a rental property vacant for months before selling it a the lowest point.

I used to have a house and rented it out. Without shopping around for a good real estate agent, I just used the first one available. Of course they charged the highest commission. But I was too sloppy to care about that. The tenant was very demanding and a little too nasty for my liking so I decided to sell the house. It was around 2011 when the Sydney housing market was slow and depressing. Nobody was buying at the time. And my tenant made sure the house was a mess whenever there was an open inspection. It took forever before the tenant finally moved out. Instead of finding a new tenant and change to a better real estate agent, I just let the property vacant for more than 6 months. The house was eventually sold at a very low price after being on the market for nearly a year.

Then magic happened. Sydney experienced the strongest housing boom in history. From 2012 onwards, you could hardly catch up with the rapid growing pace of Sydney housing price. Years later, I found out the person who bought my house sold it a few month after buying it from me and made nearly $300k profit straight away.

Lesson learned? Too many. The key one is never to be too emotional. A bad tenant certainly shouldn’t be the reason to sell your rental property.

Trading Foreign Currency with huge leverage without knowing how to trade properly.

I can be timid and have low self esteem but occasionally over confident. Take trading Forex currency for example.

I heard someone traded Forex for a living and never needed to go to the office everyday. At the time I hated my job in corporate (that was 10 years ago). It was a well paid job but being an emotional person I couldn’t handle the pressure that well.

So I quit my day job, wishing to carve out a career trading foreign currency and live happily ever after. My investment in Forex was $125k. My vision (day dreaming) was to double that money in a year. I did study Forex very hard, learning all the candle stick formation, support resistant level, different patterns and fibonacci etc etc. After all, I had a finance degree and did well, trading FX would be a piece of cake right? Wrong. I lost the entire $125k. Luckily I was too lazy to transfer money to my forex account on time so I didn’t end up loosing my entire savings account.

Thinking back, I was over leveraged and once again too emotional. I acted like a gambler, risking too much in hope of getting my money back.

One day I was walking past a food market, someone handed me some promotional material. It was a pack of chewing gum in a blue case. Turning it over, it reads: Gambling problem? Call this number: xxxxxx. It was totally spooky. How didn’t they know? Do I have “Gambler” written all over my face?

Withdrawing cash from ATM without taking the cash.

Did I say that I’m very careless with money? Yes. Did I also say that I day dream too much to a stupid degree? Let me tell you a personal story.

A few years ago, I was looking to buy a unit in Sydney. There was one that was almost reasonably priced but requires major renovation. After inspection, I walked away pondering the possibilities then the agent rang.

“Good news, the owner agreed to sell at this much xxx, but there’s another buyer that’s really interested. He’s coming to pay deposit this afternoon. If you come now and pay $1000 deposit and it’s yours.”

“But I want to think about it a little bit more.” I replied.

“No need, it’ll be gone if you don’t take it today. It’s a real bargain. I just want to let you to get it first because I really like you.” The agent assured me.

So I proceeded to the ATM to take $1000 out. While pushing the buttons to withdraw cash from the machine, my mind went wild, imagining ways to renovate, thinking over and over if it’s a really good fit. My daydream was cut off by the sound of ATM shutting down the withdrawing slot.

Wait! Did I take the cash or not? I looked frantically everywhere in my wallet, bag and pockets. No $1000. But I did withdraw the cash!!! I have the receipt from ATM. But where’s the money? Did someone else take it while I was day dreaming? Oh God.

So I went to the bank teller telling my story. Nobody believed me. ” Surely you took the money, our record shows you withdrew the cash.”

“But I didn’t take the cash!” Everyone just looked at me like it was impossible.

“Trust me! You have the video camera there! Can you rewind it and see what happened just now? Because I can’t remember what happened to the $1000.”

“No, we can’t do that.”

Tears started to rolling from my face. How couldn’t I be that stupid? In the end, a bank employee took sympathy towards me. ” If you didn’t take the money and nobody else did, the money could be taken back to the machine. It’ll be added back to your bank account if that’s the case. Just wait for 2 weeks for it to work out.” With that in mind, I left the bank.

You might have gathered by now, I didn’t end up buying that unit. Truth is, nobody else did either. There wasn’t another buying going to pay deposit that day. So my stupid mistake at ATM actually prevented me falling for a common trick of a real estate agent.

And for your information, the $1000 was deposited back to my bank account after 2 weeks.

Paying for groceries in shops but always leave things behind after paying.

Do you need to remember to take your shopping bags with you after paying the bills? Isn’t it common sense you pick out things in the shops, pay for them and take the goods with you?

Obviously I’m not normal. I just pay for things leave shops without taking the paid shopping with me. My mind is always somewhere else and I’m hardly ever present.

How many times I have to go back to the shops and collect things afterwards and how many times I left the goods behind forever? I don’t remember. 

Do I still leave my shopping behind after paying? Yes.

Paying for yearly membership then never ever use it.

I guess this could be a common one to a lot people but I bet it happens to me more often than others. I used to buy yearly gym membership but only went twice then forgot about it. The worst thing is that, I was too lazy to cancel the membership and let that automatically renewed for 3+ years. After eventually cancelling my gym membership, I got the $1500 yearly yoga pass. This time, it was slightly better. I attended about 10 yoga classes before giving up going for the rest of the year. That happened 3 years in a row. In the mean time I bought aquatic centre pass intending to go swimming regularly but never ended up using it even once.

There were a number of other club memberships that I paid for but never ever used them. Looking back, it’s easy to understand why I didn’t accumulate any wealth.

Still paying rent to my old rental apartment months after moving out.

Setting up an automatic monthly payment to pay rent is normal, but forgot to cancel the monthly rental payments after you move out is not. It was only after a few month when the rental property manager mentioned to me, “Btw, we noticed you are still paying rent to our account.” did I realise there was something very important to be done.

Paying for a car deposit without buying the car (then losing the $500 deposit of course).

I’ve had a lot of impulse purchases. There were many things bought that belonged to that “bought and forgot” category. But at least I get the pleasure of owning them. But that car purchase was not the case.

Impulse purchase is always a bad idea. It made it so hard to declutter. I wanted to learn to play piano so a piano was bought. I wanted to learn to play tennis so I bought the whole set of gear, special shoes and lots of cute outfit to go with it. The same happened to golf, badminton etc etc. Of course I didn’t have any patience to learn any of those.

Sold my old wallet but forgot to take money out.

So I sold one of my used Louis Vuitton wallet but there was still a $50 note in it. Lucy the buyer is honest and told me about it and transferred the money back to me.

There are many bad examples and there’s no need to list more. Will I ever change my bad money habit? I think so, because there’s no other choice. Who wants to grow into the old age, being stupid and destitute? Is it too late for me to learn the value of money? Well.

It’s better late than never.

 

 

 

Growing old is probably not something you want to focus on right now. It’s probably something that you actually dread thinking about due to how much stress it could cause. Retirement planning is, after all, thinking quite far into the future (at least for most of us) and the majority of the population struggles enough living in the present–they don’t want to think too far ahead.

We also need to keep in mind that all good plans are doomed to fail. It doesn’t matter how much you plan, how many contingencies you describe and how much time you put into the plan, it’s eventually going to fall apart and you’ll feel like you’ve wasted a huge amount of time.

This feeling can vary from person to person, but one area that you should never neglect to plan is your retirement. No matter how stressful it sounds or how dull it might seem, you’ll come to realize that planning for your retirement at an earlier age comes with many benefits, and we’re going to describe them in this article.

Investments are powerful

Keep in mind that money you invest now is going to grow in the future. Be it property that you’ve invested in, a retirement plan or even some savings in an account, the more money you save now, the more comfortable your life is going to be in 10, 20 or even 30 years time. That’s one of the reasons why many of us strive for a more successful career–so that our finances can take better care of us in the future.

If you want to live a comfortable life, then remember that your financial situation is very important and you need to keep it in consideration when you’re planning your future. The money you save now is going to be spent when you’re older and no longer fit for work.

Planning can help you out

Whether you’re planning on a retirement living location, where to invest your finances or who to pass your money on to, there are certain responsibilities that you absolutely should keep in mind when retirement planning. Your wealth, for instance, could be lost if you don’t write up a will and choose who to give it to. While this might seem like a very distant thing, it’s better to be safe than sorry.

Planning also helps you set goals in life. For instance, if you plan to move to a different country in the future, then it’s going to help if you focus on planning and stop being absent minded. Without goals, it can be difficult to navigate through life and find the motivation to do something. Everyone has their own goals, so sit down and decide what your personal goals are so that you can plan ahead for the future.

Hopefully, this article has given you a bit of info on why it’s never too early to plan for your retirement. Whether it’s securing your financial situation or giving yourself a source of motivation, there are plenty of reasons to start thinking about your retirement at an early age.