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The average Singaporean can’t easily increase his income. He has a job. He earns a limited amount of money. Or he has a fixed retirement income. Unless he is young enough to still have career choices in front of him, his income is already effectively set. His choices have already been made.
So if he wants to improve his financial circumstances, all he can do is to work on the expense side of the ledger, not the income side. And while the income side is helped by “commission” – that is, by doing things…the expense side is helped by “omission” – that is, by not doing things.
Want the secret to financial success? Make sure the expense number is lower than the income number. How complicated is that?
What’s the solution to over-spending? The most obvious solution for all is: Nothing! Cut spending by not doing anything!
Stop doing it. Don’t spend. See something you want? Don’t buy it. See something you need? Think again; you probably don’t really need it.
Therefore, most Singaporean’s lives are easy to improve. They don’t have to do anything. They just have to stop doing things that are “stupid”.
The same could be said of most fat people. What’s the solution to fatness? Easy… Nothing. Just don’t eat so much. Don’t fix a big meal. Don’t go out to a restaurant. Don’t have a second helping. Just don’t do it. 100% guarantee it will work.
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It is not so much credit cards that are the cause of the growth of consumer credit. There are just tools that banks use to entice us to adopt the materialism mindset of obtaining instant gratification or enjoy now and pay later mentality towards finances.
The underlying root cause is adoption of consumerism or spending to be happy coupled with lack of financial literacy amongst the average wage earner and our inability to resist the temptations of a live for now culture that is more prevalent nowadays.
To tackle this issue, we need to do more to promote financial literacy in formal education. Unfortunately, during my time and I am a CPA by training, there was nothing available except the Squirrel Savers by POSB which was a great scheme.
The challenge is to impart into our next generation the ability to delay gratification and to learn to save up for something they really need versus what they want.
Be well and prosper. 🙂
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Rule #1 don’t carry a credit card.
Rule #2 if you have cut them up
Rule #3 is Rule #1.
Encourage to watch Suze Orman show, teaching us the proper ways to plan our finances…
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