I think it was Tom Peters who said that, and with all intend and purposes, I will follow what(ever) he said, or for that matter is saying-will say.
I am literally at the turn of my career. I have been doing pretty much ‘serious jobs’, and now embark on a more ‘hip’ career. So I thought.
Personally, I have been avoiding mentor or role model, both in personal and professional life. Today, I have found what it looks like my first, new spiritual mentor. It kind of cool, to think that you are finally found a person – serendipitily, that you thought would be worthy of following or at least look up to.
On professional line, Tom Peters is one of so many candidates I look up to. In addition to Greg Mankiw, Jagdish Bhagwati, James Tobin, and Umer Chapra. The list can be a long one.
So, I guess this urge to blog for my life would be sort of endeavor to identify my mentor. Probably it would force me to dig deeper into the candidates’ pocket and brain.
23 Jul 2008
11 Jun 2008
It runs in the family
Recently my 8 years daughter sms-ed me reporting that she is now 'rich'. I asked how and how rich? Layyin then told me that she had just managed to sell a fridge's freezer-load of es-lilin (homeade ice cream) to neighbours and friends. She made 'profit' of and became richer by Rp.25,000!
I wanted to ask her what is the cost and whether she has 'paid' our maid for helping her out in making the ice cream?! But, I figured it would spoiled her thrill.
I instead asked what she gonna with the money. She replied 'save; and when its a lot, I can go to Bali with daddy and mummy' - I smiled and could not say a word...
This whole thing was my wife's idea. She herself started even much younger in managing money and run a business. Her parents were true entrepreneurs and a disciplined parent when it comes to money. So, its kind of a deja vu for her.
Is this good for our daughter? Is teaching a kid early in 'holding' money necessarily bad?
I think not. Its a good thing in fact.
What is bad is when parents give money for young kids to spend; often as 'pocket money' to buy candy, ice cream (like my kid's customers friends; well, someone has to buy right?! :)), barbie's stickers, power rangers toys, and more.
That will definitely implant consumerism to our children permanently.
A book Born to Buy by Juliet B. Schor, vividly exploited this topic. How parents are actually voluntarily and consistently teach their children to buy, to consume and spend - perhaps contrary to our good intention. But, kids learn differently; and they absorb quickly what their parents do, either good things or otherwise.
Taking kids shopping or to the mall over the weekends, for instance, is also part of that 'learning' technique. When we parents use credit card to pay monthly groceries or buy new clothes, our kids are actually observing and taking note.
What they see is that spending is easy; my parents has loads of money to spend. So, next time they are in shopping mall or supermarket, they will just take stuffs from the shelf, or whenever shopping or buying opportunities occur, they will simply ask, or cry of, or scream at - even to the things that we thought and insist not necessary to them. But that is our words, not our action.
This is perhaps the most important lesson on teaching kids to be frugal, to save.
Have I practiced this to my entrepreneurial daughter?
Well, yes and no. Previously, before reading this book and aware of this grave mistake, I was as ignorant as anyone else too. I take them to monthly shopping, teach them how to spend; even when they are babies.
Now, that my wife and I aware of this, we are starting to teach frugal values and lifestyle to them. And we now try to avoid taking our three kids shopping or to shopping malls, whenever possible.
Another way to unlearn, I guess, is by teaching them another side of the coin; from spending to earning or saving. Teaching them to earn and value money is probably as valuable as not teaching them spending or consumerism.
After all, consumerism or frugality actually runs in the family. Its just how and which one we are giving a chance to thrive.
I wanted to ask her what is the cost and whether she has 'paid' our maid for helping her out in making the ice cream?! But, I figured it would spoiled her thrill.
I instead asked what she gonna with the money. She replied 'save; and when its a lot, I can go to Bali with daddy and mummy' - I smiled and could not say a word...
This whole thing was my wife's idea. She herself started even much younger in managing money and run a business. Her parents were true entrepreneurs and a disciplined parent when it comes to money. So, its kind of a deja vu for her.
Is this good for our daughter? Is teaching a kid early in 'holding' money necessarily bad?
I think not. Its a good thing in fact.
What is bad is when parents give money for young kids to spend; often as 'pocket money' to buy candy, ice cream (like my kid's customers friends; well, someone has to buy right?! :)), barbie's stickers, power rangers toys, and more.
That will definitely implant consumerism to our children permanently.
A book Born to Buy by Juliet B. Schor, vividly exploited this topic. How parents are actually voluntarily and consistently teach their children to buy, to consume and spend - perhaps contrary to our good intention. But, kids learn differently; and they absorb quickly what their parents do, either good things or otherwise.
Taking kids shopping or to the mall over the weekends, for instance, is also part of that 'learning' technique. When we parents use credit card to pay monthly groceries or buy new clothes, our kids are actually observing and taking note.
What they see is that spending is easy; my parents has loads of money to spend. So, next time they are in shopping mall or supermarket, they will just take stuffs from the shelf, or whenever shopping or buying opportunities occur, they will simply ask, or cry of, or scream at - even to the things that we thought and insist not necessary to them. But that is our words, not our action.
This is perhaps the most important lesson on teaching kids to be frugal, to save.
Have I practiced this to my entrepreneurial daughter?
Well, yes and no. Previously, before reading this book and aware of this grave mistake, I was as ignorant as anyone else too. I take them to monthly shopping, teach them how to spend; even when they are babies.
Now, that my wife and I aware of this, we are starting to teach frugal values and lifestyle to them. And we now try to avoid taking our three kids shopping or to shopping malls, whenever possible.
Another way to unlearn, I guess, is by teaching them another side of the coin; from spending to earning or saving. Teaching them to earn and value money is probably as valuable as not teaching them spending or consumerism.
After all, consumerism or frugality actually runs in the family. Its just how and which one we are giving a chance to thrive.
10 Jun 2008
My portfolio
I am not quite sure how exactly my portfolio looks like, since my wife is also managing a big part of our joint finances. But, more or less, my investment portfolio is looking a lot like this:
1. Education plan
Since birth, our three kids are enrolled in an education insurance (Takaful Siswa) plan earning 9-10% returns per annum. Every month Rp.250,000 for each kid is automatically deducted from her salary. To date, this combined plans have accumulated more than Rp.25m. We plan to withdraw for the first time this July, to cover Hayyan's enrollment fee for Primary school. The rest of the accumulated funds are still intact, and will hopefully be, since my wife and I plan to withdraw lumpsum when the kids are entering college/university.
2. Retirement
I started a retirement plan (lumpsum upon retirement) at one DPLK in 2005, and contributed a meagre Rp.100,000 per month. I will have to contribute this amount until I am 50 to this plan. Small but that's what I could afford then. After three years now, and good returns of 12-14% per year, my retirement plan looks promising and not that bad. I think I have a balance that could sustain 2 months of life without a job. My wife joined last year and she allocated double my amount, and she already happy with the returns.
Other than this, I also have a pension plan from my current employer. Its about 10% of gross salary and solely managed by the company. I can only get this fund when I quit the job - and received them all in lump sum. Not very flexible though, but at least the money is safe there and beyond my tempted hands to spend them.
3. Emergency fund
This is my biggest loophole at the moment. I am fully aware that ideally a household should have somekind of emergency fund, which is enough to sustain basic expenses for at least 3 months. Frankly, I dont have one. But I do plan to start one and begin allocating 3-5% of my salary to this 'account' next month - and I hope it materializes.
4. Others
I dont recall any other investments that I have - I am afraid none. But my wife does have some fixed deposits from her own part-time businesses.
So, basically my portfolio looks pretty basic and not so much of a role model. But in the near future I plan to add more instruments into my egg basket, primarily unit trust, unit link/insurance, gold, and a liquid saving/current account for emergency.
1. Education plan
Since birth, our three kids are enrolled in an education insurance (Takaful Siswa) plan earning 9-10% returns per annum. Every month Rp.250,000 for each kid is automatically deducted from her salary. To date, this combined plans have accumulated more than Rp.25m. We plan to withdraw for the first time this July, to cover Hayyan's enrollment fee for Primary school. The rest of the accumulated funds are still intact, and will hopefully be, since my wife and I plan to withdraw lumpsum when the kids are entering college/university.
2. Retirement
I started a retirement plan (lumpsum upon retirement) at one DPLK in 2005, and contributed a meagre Rp.100,000 per month. I will have to contribute this amount until I am 50 to this plan. Small but that's what I could afford then. After three years now, and good returns of 12-14% per year, my retirement plan looks promising and not that bad. I think I have a balance that could sustain 2 months of life without a job. My wife joined last year and she allocated double my amount, and she already happy with the returns.
Other than this, I also have a pension plan from my current employer. Its about 10% of gross salary and solely managed by the company. I can only get this fund when I quit the job - and received them all in lump sum. Not very flexible though, but at least the money is safe there and beyond my tempted hands to spend them.
3. Emergency fund
This is my biggest loophole at the moment. I am fully aware that ideally a household should have somekind of emergency fund, which is enough to sustain basic expenses for at least 3 months. Frankly, I dont have one. But I do plan to start one and begin allocating 3-5% of my salary to this 'account' next month - and I hope it materializes.
4. Others
I dont recall any other investments that I have - I am afraid none. But my wife does have some fixed deposits from her own part-time businesses.
So, basically my portfolio looks pretty basic and not so much of a role model. But in the near future I plan to add more instruments into my egg basket, primarily unit trust, unit link/insurance, gold, and a liquid saving/current account for emergency.
27 Mar 2008
Warren Buffet: Letter to shareholders
It is always interesting to see and look up at the Warren Buffet. His investing strategy is so 'orthodox', or conservative to say the least. It somehow defies so many strategies put forward by well known investment gurus, or what being practiced by wall street junkies. I only realized that it is actually a pretty simple one. Just as my 'convert' friend quoted the other day.
Out of curiousity, I checked his website - and truly amazed with its simplicity and depth of investing wisdoms, especially his letters to shareholders as found here. It is truly amazing that this old man has been beating the S&P 500 performances in most instances since the 1980s. And to me, reading his letters is enriching and eye opening.
To share my awe, I quote the most direct of Buffet's advise here:
A truly great business must have an enduring “moat” that protects excellent returns on invested capital...
Our criterion of “enduring” causes us to rule out companies in industries prone to rapid and continuous change.
Out of curiousity, I checked his website - and truly amazed with its simplicity and depth of investing wisdoms, especially his letters to shareholders as found here. It is truly amazing that this old man has been beating the S&P 500 performances in most instances since the 1980s. And to me, reading his letters is enriching and eye opening.
To share my awe, I quote the most direct of Buffet's advise here:
"...I look for companies that have;
1. a business we understand,
2. favorable long-term economics,
3. able and trustworthy management, and
4. a sensible price tag.
We like to buy the whole business or, if management is our partner, at least 80%...
A truly great business must have an enduring “moat” that protects excellent returns on invested capital...
Our criterion of “enduring” causes us to rule out companies in industries prone to rapid and continuous change.
26 Mar 2008
Financial Goals
I recently found my old journal where I wrote list of my goals for the next three years. It look like this:
1. Safe 40% of salary
2. Enrolled for Ph.D
3. Write book
Looking at where I stand, I kind of somewhere slightly far from achieving even half of these goals. So I guess, my new goal is to achieve at least half of the above list. The easiest perhaps is the first one. I will aim at 25% for a start.
After a year or so, I will return to this post and see. Wish me luck people.
1. Safe 40% of salary
2. Enrolled for Ph.D
3. Write book
Looking at where I stand, I kind of somewhere slightly far from achieving even half of these goals. So I guess, my new goal is to achieve at least half of the above list. The easiest perhaps is the first one. I will aim at 25% for a start.
After a year or so, I will return to this post and see. Wish me luck people.
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