Common Sense Prudence

Why do you still stay in a 3-Room Flat and drive a Suzuki when you can afford much better?

This is a common question I get all the time.  I myself must have asked that question of others in my earlier years. The answers to that one simple question are varied as they are vast but I’ll sum it up in a handful of not-too-long paragraphs.

I Don’t Need More.
Really I don’t. And even if I did, the last two years have not been the best time to get a bigger house or car especially when prices have been going up and up. Like the trader I am, I don’t buy things at or near the highs or as they continue rising. Having recovered from nothing, I am used to having bare minimal and keeping costs low. Even now as I can afford more luxury, I don’t find it in me to spend lavishly as I have never been that way all my life.

I am not fully invested. I have taken the advice of my wise old friend, G.M. Teoh and kept cash ready. As a personal rule in this current economy, I am not investing more than 50% of my cash and keeping hoards of it ready to pick up more investments when opportunity come knocking. Whatever I am invested in can easily be liquidated for cash if the need arises. And the need will not arise as long as I keep 50% of it as ready cash.

Money has never been a main priority in my life. To me, money is there to be made and I have been blessed with the gift of making it as and when I need it. I have always prioritized more important passions above money as long as there was enough of it to provide for a comfortable life. So what do I do with all that money I’ve made? Read on …

I’m Absolutely Debt Free.
For the first time in my adult life, I have enjoyed a debt-free life since my bankruptcy discharge in April 2007. Everything I have, I own outright. I own my 3 room flat. What little I owe the HDB for the few remaining payments can be easily covered with a small percentage of my CPF money. The bills on my flat are conservative because it is a small flat. The flat we live in is Home and it doesn’t matter what it looks like or how big it is as long as it’s comfortable, conducive and filled with love.

I own my Suzuki. There are a few remaining payments I can’t settle in bulk because the damn finance company needs to collect the interest to stay in business. (Doing my part to keep the economy afloat.) My petrol bill per month does not exceed $200 (Shell V-Power, no less) as we hardly use the car anyway. Its two and a half years old and I have only clocked up 30,300km including a trip to Bukit Bintang. S0 why buy an expensive flashy car I don’t need?

I don’t have credit cards – what I need, I buy with cash or my debit card. I don’t trade on Contra. I don’t owe anyone anything at all. I am debt free and loving it.  Being debt free to me is much better than being financially free. Of course now that I am both, I can’t say it’s all that bad.

I’m Happy.
My only luxury in life today is a life-long dream that I have hung on to and only recently made a reality. In my younger, struggling days in the media industry, I had always wondered what it would be like to walk into any restaurant I desired, picked up the menu and ordered whatever I wanted without having to look at the price. I remember how terribly embarrassing it was to entertain clients and worry about paying the bill and hoping we’d have a “wallet duel” that the client would win. Those days are gone now. Today, I sit across from people who hope I win the wallet duel … and I understand how it feels to be in their shoes.

I know a lot of people who have flashy cars, nice houses or apartments but are stressed out with monthly payments and debts. They would rather keep these unafforable luxuries in the name of face and pride rather than to live prudently and be happily cash-rich. Isn’t it funny how the ones that can’t afford it, must have it and those who can, don’t bother. I had always wished for it and in some time in my past, lived the life of one who couldn’t afford it but did … albeit with some prudence. Reality has a strange way of teaching us these lessons – it’s called Maturity – and it is always a tough lesson to learn.

Being wealthy is not the key to being happy. I have always chosen to be happy, no matter what my circumstance. Maybe that’s what got me out of bankruptcy and all the other sticky situations in my life. Choosing to be happy makes financial goals more achievable. If you can’t be happy with what you have, nothing and everything will never be enough and you will never be satisfied, let alone, happy. Being thankful and grateful for the little things you now have will lead to bigger and better gratifications in time. It all starts with choosing to be happy. Problems are always temporary … happiness is permanent if you wish it to be.

I’m happy to have a wife who knows what having nothing means having come from nothing and then losing everything on more than one occasion. She is a prudent yet financially savvy chic from whom I have learned a lot about financial management. She doesn’t make big demands, doesn’t ask for much and is a very simple person at heart. If anything, I am the one who wants to spoil her.

If I do owe someone and have a life-long debt to, it would be my wife.

And she deserves all I have.

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Hi Conrad,

You’ve really echoed the concepts highlighted by Dr. Thomas J. Stanley & Dr. William D. Danko in their book; “The Millionaire Next Door” which is…

Frugality & “you are NOT what you drive, wear & own”

An interesting and yet insightful find was that most millionaires are actually frugal and spend only a small % of their wealth/net worth on material things. The middle class however spent a huge % of their wealth/income on material things. In fact, the rich spent lesser than the poor!

It is a sad reality that many people associate an ideal wealthy person as someone with a flashy lifestyle.

I’d still recall one of Donald Trump’s The Apprentice Show where he claimed to have arguably the most impressive apartment in the world at his Trump Towers and well, no one can dispute that. However, when one of the contestants asked him when was the last time he ate dinner with his family there, he couldn’t remember.

Dr. Thomas J. Stanley & Dr. William D. Danko said it best, “Life has its own burdens, why add excess baggage?”

Though this is my 1st time coming across your blog, I’ve to say it won’t be last. It’s great to have a role model for Singaporeans like me to follow. While I’m just starting out in my pursuit of financial education; I’m sure our learning curve would be cut short by following timely advices from people like you.



Nice dispatch and this post helped me alot in my college assignement. Say thank you you seeking your information.

I would definitely put a ‘like’ if this is on Facebook..

Great piece Conrad. Every successful trader have their own style / personality and you are comfortable with yours ;-) As long as the money rolls, let it be … :)

Hi Conrad,

Do you buy Golden Agri stock?? Why or why not? When is the best time to buy this stock based on agricultural cycle?

Is it a good stock to keep or trade?

Thanking you in advance.

Dear kohsg …

I did .. a long time ago earlier this year. I am not holding now because there are better bets. I don’t advise on buy or sell orders, sorry. But to be honest and not sound sarcastic, there is never a best time to buy anything … if I knew such answers, I’d be a God.

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