I received the above letter from one of my readers a couple of weeks ago but could not find the time to reply due to my work commitment. As usual, I was reluctant to provide specific advice or guidance on investments that would mislead my readers into thinking that I am a financial guru. I just want to emphasize again that I am not. As a matter of fact, I don’t even work in the finance sector. But after much thoughts, I decided to share some of my insights pertaining to the reader’s question.
It is important that young Singaporeans have the right mentality before they embark on their wealth building journey, especially those who are about to enter the workforce. The decisions made in the early stage of our lives will shape our financial destiny and future but young folks can become lost in their pursuit of money. So I want to impart some knowledge and life experiences to Jacky (not his real name) and guide him along. Hope this article will make a positive impact to his life.
Jacky should read widely on various topics to improve his general knowledge and understand how the world works. The knowledge gained will put him in good stead but only if he practiced what he learned. Having made so much profits from trading, I supposed Jacky had developed his own set of investment techniques. To increase his wealth to the next level, he should read up on topics such as value investing, dividend investing, property, gold, bonds and insurance. These are techniques and instruments that can strengthen and add value to his portfolio, but only if he applied them correctly.
Another thing that Jacky should think through is whether he wants to pursue a full time career as a trader upon graduation. It really depends on where his interest lies in. In Singapore, whether you like it or not, a degree is still the entry-level requirement for a good career. So Jacky should try to harness the value of his degree and strive to extract the maximum return out of it. If he spent $40,000 for his tertiary education, then he should get a job that pays well and recoup at least 10 times the investment. If he chose to become a full time trader, then there would be an opportunity loss. This is because you don’t need a formal education to be a good trader. You just don’t learn this skill from the school. Conversely, most Singaporeans spent at least 16 years to pursue their education, so it is important that you extract the maximum value from the time and resources invested. Otherwise, it will be a real waste.
Making money is important but there is more to life than making money. We are born to enjoy life, so don’t be so engrossed in making more money. Chasing the money will only make you miserable. Enjoy the process.