Author: Growing your tree of prosperity

The Art of the Good Life #47 : Making Friends with Weirdos.

This is a chapter that resonates with me because I have considered myself as an outcast and weirdo. I grew up playing Dungeons and Dragons which was possibly the geekiest hobby you can have in the 1980s. I also spent the greater part of my life as an Internet Troll on YPAP BBS. Just last week, I met up with an old secondary school classmate and we large spoke about how alienated and out of touch we were with our classmates. The chapter concludes that a weirdoes life is not a good one, although they belonged to the group...

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A gentle critique of Loo Cheng Chuan’s 1M65 idea.

Everything I do with my finances is based on my own readings and self-study. I never had a mentor or a Sifu when it came to money. In similar vein, I seldom attend financial talks unless I have to give a talk myself and get to listen to other speakers on that day. Very recently, one of my ex-NS buddies contacted me after reading about commentary at Channel News Asia and as it turns out, he now works with the Institute of Financial Literacy so he sent me an invite for a free lunch. During that event, I was...

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The Investment Book of 5 Rings

One of the my favourite RPGs of the moment is Legend of the 5 Rings and one of the really cool design elements of the game is that it deviates from Western themed RPGs by not using the typical character attributes like Strength, Intelligence. Instead your attributes are based on the 5 Rings of Air, Earth, Fire, Water and Void. The elements are used to resolve dice rolls when you adopt a stance in combat or an approach to solve a problem. As it turns out, this is a pretty useful system to think about investing. We all have...

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The Art of the Good Life #46 : The Arms Race.

This chapter reminds us to avoid the Arms Race. This advice is particularly relevant in Singapore. The biggest arms race in Singapore is the game of buying tuition for your kids. Parents are fighting an arms race that sees their children studying much harder but being unable to meaningfully do better than their peers because the other kids also have a lot of tuition. The only effect of playing this game is to enrich tuition centres. At the professional level, the legal industry is also big red ocean that sees the top A level students being thrown into an...

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Why do engineers get so little credit for building massive wealth ?

Ok, so you guys probably know that I’ve spent the greater part of the week fending off trolls after my commentary appeared on Chanel News Asia. This is the third time I was exposed to mainstream media and each time I try to develop a new approach to engage critics who mobbed my articles. So this time, I think the strategy of engaging critics was a lot better since I started conversing with them directly on Facebook. However, some things don’t change. Critics first attacked me for being single the first time I showed up in Me and my...

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The Art of the Good Life #45 : If you run your own race, you can’t lose.

This chapter of the book cuts pretty close to the bone. For the past thousands of years, the work of humanity has evolved from that of a generalist to that of a specialist. Our ancestors have to forage, hunt, build their shelters and cook their own food to survive in the wilderness. These days, you can’t even call yourself a marketing executive, you might have to specialise in a niche like social media marketing for an employer to take you seriously. The lesson from this book is to stop reminiscing about being a successful generalist. One formula for success...

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My Commentary on Channel News Asia.

Channel News Asia contacted me last week and asked me whether I would like to write a commentary on whether increased longevity would lead to working for a longer period of time. The result is a commentary on their website that you can access here. Do note that I’m not exactly a financial consultant. I run workshops for now and I do not deal with buying or selling of any financial product. Working with Channel News Asia was a breeze. I’d just like to point out something interesting in my original submission which was edited out by Channel News...

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Making your retirement safer with a "bear trap" account.

Blog reader with the “Unkown” moniker brought up an important point about the weaknesses of using computer models to simulate the withdrawal of funds from a retirement portfolio. I cannot say that I fully understand the maths, but I think I can explain the problem  to a lay person. Most of the retirement simulations makes sense, but if you are unfortunately enough to face a nasty market crash just around a year or two after giving the middle finger to your corporate bosses, the odds of running out of money increases dramatically. Initially I thought that there was no...

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Early Retirement Scenarios

Thanks to the efforts of BIGS contributor and venture capitalist Lim Der Shing, we now have a decent simulation tool to track what happens when we start drawing out money for retirement. A link to the academic paper and tool can be found here. I’m going to share two retirement scenarios and discuss the implications of using such a tool to determine the target withdrawal rate and subsequently the portfolio size to support this retirement lifestyle. Before getting into the scenarios, I just want to highlight a possible controversy to the use of this spreadsheet. I use the real...

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The Art of the Good Life #44 : Cargo Cults

During World War II, natives living  in the islands involved in the War of the Pacific saw soldiers call upon metallic birds which flew past and dropped tin cans which contained delicious food. After the war, a cargo cult was born – natives built planes out of straw to attract these metallic birds which they hoped would drop more food on them. Some people ask me why I am so obsessed with results rather than process. The reason is that I do not wish to fall into the same category as these cargo cultists. Process is important because it’s...

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Races of Wealth Accumulation : The Dwarf, Elf and Orc

Sarah Stanley has continued the good work of her late father Thomas Stanley and updated The Millionaire Next Door into a new book The Next Millionaire Next Door and it is chock full of interesting facts about how to get rich in this current economic environment. Inspired by both her material and our recent discussion about approached towards early retirement, I thought I’d write about three type of millionaires which I categorise as three fantasy races of dwarf,elf and orc so that we can distinguish three distinct roads to riches. a) The Dwarf The largest number of millionaires are dwarves....

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How long do you need to endure when faced with a market downturn ?

Part of the work of being a trainer is that I am relatively free to pursue some research to improve on my training materials so I got back to some R programming this week. My statistical programming is rusty again and I have to get back to the basics of understanding data frames and how to put simple packages in my R Studio. And this means dealing with some stuff that professionals find trivial like manipulation of dates and processing the finance data from Yahoo Finance. Fortunately, I was able to get some useful thing done within the last...

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The Art of the Good Life #43 : The Just World Fallacy

This chapter serves to remind us that the world is amoral and that thinking that morality will win out in the end is a fallacy. The author emphasises that the world is actually unjust and that living stoically would actually result in much fewer disappointments. One recent event that made quite a number of folks angry is NTU organising a job fair that is exclusive to students with the best grades. It’s quite easy to vilify NTU and say that doing this is incongruent with the Singapore’s recent attempts to reduce the elitism in society. But just as hard...

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How to start a war in the financial blogosphere.

The major fracas going on in the financial blogosphere right now started this week when Suze Orman told the Internet why she hates the FIRE movement. You can access that interview here. This got me thinking about how a pitched battle can occur within the local financial blogosphere here. Here are my thoughts on how to spark a war in out blogosphere : a) There are industries here that should really hate the FIRE movement The Singapore FIRE movement irks people for many reasons. I can imagine that commission sales agents who sell insurance, active fund managers or even...

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The Art of the Good Life #42 : The Illusion of Changing the World

The second installation of “The Illusion of Changing the World” argues that you should not try to take yourself too seriously and put yourself on the pedestal. While inventions can be made by a specific individual, if the individual had not existed, the invention would have been made anyway because many folks in this world may be looking at the same problem. Reinforcing this idea further is that many large companies can change CEOs but company results are often quite consistent no matter who is in charge. I try not to invest based on my feelings towards a company’s...

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