Sunday, 23 September 2018

Singapore Dividends for Financial Freedom - My Story 4




Hi folks, I trust all is well. You may have noticed I did not post anything last week. This was because I was in KL on business. Now, back home, with the mists of guilt slowly lifting, my fingers are once again back in typing mode, and my mind is in the right place to allow for the free flow of ideas.

Today's, post is a reflection on a time and a person.

The time is 2015 and the person 'X'. Of course, no story is complete with out a setting, so for the sake of anonymity, let's call it 'H'.

In early 2015 I traveled to 'H' to visit my family, whom I'd not seen in quite some time. They live in a mountainous, serene place full of fresh fast-flowing rivers and the greenest fields you could imagine. Mix together an image of a fairy tale with a Microsoft desktop image of a verdant pasture and you're getting close.

Anyway, when people live in places blessed with such outstanding nature beauty, they often tend to operate in tune with the vibes of mother nature. By that I mean people move at a pace similar to their surroundings. This gentle, care-free style of living is disappearing around the globe as more people move to cities. In fact, by 2050 two thirds of the world's population with live in urban centers (link)

This fact leaves me with ambiguous thoughts. One the one hand, people swarming towards cities means greater opportunity for business; however, on the other it also means a loss of the aforementioned lifestyle. I don't know if any of you grew up in a rural area, but if you did, you'll know what I'm getting at here. It feels nice to walk to the local greengrocer and immerse oneself in the gossip of the day:

Sam left the bar early last night with Sara; there's a rumor flying about that the Hamiltons at the end of Main Street are thinking getting into the cafe business and setting up beside the bank; Did you hear the one about Mr. Devinish? He was caught bringing back 2000 cigarettes from the south of Spain. And he a teacher...

As futile as this type of daily patter sounds, it does add a certain intimacy to everyday exchanges, a warmth.

City living, I find, lacks this intimacy. I'm not saying it doesn't exist, it does, but just to a lesser extent. My experiences of city living left me feeling somewhat atomized in the big smoke. I'm sure you know what I mean: surrounded by folk but wanting for that sense of community the countryside has in abundance.

Right, just where am I going with this post. I have a tendency to drift off into the flow of my subconscious, typing everything that pops into my mind. Call this stream of consciousness writing if you like, or simply self-indulgent bullshit if you will, but I'm writing as an exercise in mindfulness in our scattered, chaotic modern times.

Let's get back to the story shall we? I hope you'll excuse these strange digressions and stay with me.

I mentioned my old friend 'X' earlier. Let me tell you a bit more about him.

'X' is the same age as me, and we grew up in the same picturesque, rustic place described before. As teens we spent large swathes of time together talking about everything under the sun - except investing and finance. In fact, these things were anathema to us and our friends. We danced to the rhythm of Marx, Hakim Bay, Chomsky etc. rather than Adam Smith. Yes, the ideas of the far left appealed greatly: Alienation, The Temporary Autonomous Zone etc.

As youngsters we sat in forested areas, a bottle of cider in hand, discussing the finer details of class politics or the need for violent revolution to overthrow the capitalist oppressors.

'X' in particular was extremely well read in history, philosophy and classic literature and would often educate us all on the finer details of the fall of Rome or radical politics of the 19th century.

At this time, none of us ever mentioned the stock market. These two words said out loud would have conjured up images of the greedy rich who dominated society using the oppressive apparatus of the capitalist state. The idea that a working man could achieve financial freedom using his own head and cash was way beyond our reckoning.

As we got older, 'X' continued to study hard, earning degrees in history, and philosophy. After this, he took a shine to science and mathematics and got a masters in environmental science. All of this hard work and intellectual endeavour sunk him into debt.

Around the time 'X' passed his masters, I met him and volunteered to be part of a forest school. We spent a week working together building wooden huts and natural amenities. I mentioned to 'X' I wanted to retire early and needed to find a way to make this happen. He dismissed my ideas stating that a lifetime of graft was inevitable.

This conversation stayed with me and I knew I was at a pivotal moment in my life. I was determined not to work forever. Not that I dislike working - for from it- rather I wanted to find a way to make my hard earned money work for me. The thought of working hard and then letting my stash get eaten by inflation irked me. I mentioned this fact to 'X'. He shrugged it off and said the bank's where money belongs.

How could this be true? If inflation sits at 4% and my money in my Current Account is earning me 0.5% it doesn't take a genius to work out what will happen over time. But this is the crux of the issue. When you're brought up in an area where people don't invest in stocks, and in fact, view them as 'betting for rich folk'; if this is the case, then what hope do people have in making their money work for them? What chance to people have when they traverse through the schooling system and never once are taught about money and how to make it work in their favor?

It's bullshit, isn't it? Imagine in school you had a class on investing. In it you would learn about value dividend investing, growth investing etc. and suddenly a kid's perceptions on saving and money would be transformed. Instead of sitting around a campfire week after week and talking about Jungian theory or Joyce's use of interior monologue, teenagers might pass the bottle and talk about the value of REITs presently or how their portfolio is compounding.

Now, don't get me wrong, I'm still a stickler for literature, history and philosophy, but I just think they shouldn't monopolize the conversation.

Ironically, if you ask 'X' about his work, he'll tell you he hates it. However, he prepared to keep plugging away, day after day, week after week, year after year simply because he has the wrong attitude towards finance.

So, to cut this long and story short, I think we all need to be less like 'X' and educate ourselves to the point where we can make competent financial decisions that positively influence our future. Until we do so, life will continue to be drawn-out just like 'X's' and financial freedom with be the stuff of myth.

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