Saturday, 10 September 2011


When I was in secondary, I started to dream of this and this:

I saw other people have it, thus I also want it - My older brother and sister and other friends own the thing in first picture. (wait did I say owned it? Technically it should be own it with loans.)

When I first graduated from university, I still dream of the above. I want to work hard to earn and own it.

I saw many of my friends own the thing in the first picture. But what puzzle me is how did they manage to own it? where did they get so much $$$ to buy it in the first place? (At time time, I was noob. I did not know that they owned it with debt that kills a large portion of their pay.)  Nevertheless, that time I was jealous and hope that one day I can own it too!

However, around 2 years ago till today. I did not dream of above anymore even though my friends now own more than the first picture, they own the thing in the picture below and they complain to me that it eats up all of their cpf and their take home pay. Some even told me that they scare of losing job and have to work hard to secure their jobs for 30 years or even longer. But is there really job security nowaday?

Today, I only own the thing below with little debts. (maybe 1/3 or 1/4 of what their owed banks for the above nice thing.)

Look old and sluggish right?

I may seems to be cheapo to my friends, but....

I know that half of my monthly cpf can cover the monthly installment. (for your info, my pay is not high. In fact much lower than peers.) Although I don't have the so called luxury, but I am happy and content because I know that I can clear the above debts in at most 10 years using both mine and my wife's cpf if I want to or I can clear it immediately with all the cash and cpf both of us have currently. In addition, I do not need to be a slave to my job but I still want a job because i need $$$ to play with Mr Markets for the rest of my life :)

I forgot to mention. For my transport, I have this:

By the way, do you know what is BMW?

In future, I will aim for the second picture which I posted earlier but not for my stay :)
So ultimately, one day I will own something which my friend owned when they first grad but at much later date.


End of story. So what is the moral of the story? I can think of a few. Please feel free to add on.
  1. Be content with what you have
  2. Plan your finance well. Others may looks glamorous in front of you, but you don't know what happen at the end of month when the bills are in. A debt free person is a happy person. A galmorous person may not be
  3. Delay gratification helps
  4. Have a dream
  5. Know the difference between wants and needs
  6. Live within your means


AK71 said...

Hi OT,

You have it cracked! Congratulations!

When we buy something with the help of leveraging, we do not own it. We have possesion and control but not ownership. People have to know the difference.

However, not all leveraging is bad. Some amount of leveraging is good and even necessary in life such as in the purchase of a piece of real estate. The trick lies in knowing how much leveraging is good and at what point does it turn bad.

I look forward to you sharing any progress you are making in your journey towards financial freedom. :)

Glayz said...

Hi OT.
Actually I used to envy those who own so much as well. But now I only want to achieve debt free... Having a huge savings is good, but being debt free is downright sexy! At least there will be CPf $ left after the loan is paid.

OT83 said...

Hi AK,

Your distinction is much clearer than mine. Buy with leverage only give control and possession but not ownership. Some leverage is good, personally I will go for net cash position for my hdb loan. If interest/investment gain greater than debt interest, I will not repay the loan.

AK going to retire soon? Congrats!

Hi Glayz,

I am wondering who glayz is, lurker for my blog posts? Haha, on careful scrutiny, you are kappo. what does kappo and glayz mean?

Feeling of debt free is good. But I think I will prefer stay net cash instead.

For example, if the interest gain for xx amt in cpf/investment is greater than hdb loan of 2.5%, I will not repay the loan. In addition, if the xx amt is more than the debt left, I will be in net cash. I can pay off anytime I like, but maybe not now. Bascially, I will feel debt free too with net cash position.

Thanks AK and kappo for comments!

Singapore Man Of Leisure said...

Tsk tsk OT...

You must brush up on your hokkien OK? Kappo don't know? Wee bit. Wee bit. LOL!

BMW? Hmm... You have Boy, Mother, and Wife? Just joking!

I now use Bus 11 a lot - austerity measure mah! Train and bus fares go up by 40%! I wonder if Singapore's public transport go up by 40%, will Singaporeans protest outside parliament?

PanzerGrenadier said...


Keeping up with the neighbours by having the same size home, car and other material stuff is not the way to go if one doesn't want to end up working for the banks their entire working lives.

It's more important for each of us to understand what is important in our lives and whether we want to live within our means.

Be well and prosper. :-)

OT83 said...

Hi Panzer,

Yup. I always aim to live within my means and make sure stay happy. No point having so much moeny but not happy.


BMW is good! I advocate bus 11 too. Good for body exercise too.

Createwealth8888 said...

All leverages will start off as good debts but will they end up as bad debts is anyone guess.

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