My Reservist and what I have learned

I'm back from reservist. I really can't believe how I survived the past month of busy-ness. But back here I am, still in one piece, fortunately.

I talked to many of my peers while in reservist, and have quite a few interesting insights. Unlike what the newspaper make out what the age group of 20~29 to be (in terms of high debt), none I knew while in reservist were under that category. However, I was rather aghast that while most know that financial planning is important, most do not know how to plan their finances, nor know how to invest their monies.

Some of the financial stats of pple I talked to and asked are below. It was rather interesting and enriching.

Person 1. Masters student with scholarship allowance of $3k/mth
Surprisingly, he has  not much savings. While he's not in debt, he spend quite a bit on travel. However, that's not his main expenditure. Interestingly, he spends nearly $1k a month on insurance and savings plan, all "advised" by his financial advisor. As such, he has not much savings left. He has since graduated from his masters program, and starting on a salaried job soon. Same age as me.

Person 2. First class honours student with salary of about $4k/mth before CPF
He has cleared his CPF education loan (I have 6.6k left to clear) and has about 30k in savings now. No car nor any other assets. Interestingly, he spends about $700 a mont on insurance and savings plan too, again as "advised" by his financial advisor. Same age as me.

Person 3. O levels education. Salesperson with average commission $4k/mth
I did not ask him too much, other than the cost of his car and his average salary (excludes bonus I suppose). His car is a VW that costed him $82k, and the monthly loan repayment is about $800. 2 years older than me, and married with kids.

Person 4. O levels education. Employee of $1.2k/mth turned businessman of 3 businesses
This is the person I'm most impressed with. He's 2 years older than me, and married with kids., complete with his SUV. One of his business has a turnover of 600k annually at the moment. This business was started with only $1k in capital! (FYI, I have watched his business grow since inception 2 years ago.) I talked the most to him, and learned quite a fair bit of things. His monthly expenditure comes close to $5k and he can still afford it easily as his business is still growing.

At the moment, this businessman friend is living mostly on his savings while reinvesting most of his business profits back into his business to grow it further.


What I have gathered is, it appears that at times, higher education is a double edged sword in terms of financial growth. In a way, it ensures that you can live comfortably as a middle class. In another way, it binds one to being employed, and makes one more unwilling to take on risks. This makes it emotionally harder to break out of our comfort zone to move into the unknown.

Face it, how many of us would be able to climb the corporate ladder to become a CEO and earn probably upwards of $30k/mth?


One revelation I had too was that as a business owner, the salary you draw from your business is not the only amount that you have. You are actually paid for growing an asset (your business). Your asset and networth continues to grow even as you pay yourself a salary.

Next year will be the year I'm going to experiment further. Stocks will probably continue to be of lower and lower priority as I attempt to generate funds through other ways.

Afterall, like what my businessman friend said. "What's $10k a month? It's nothing at all! You can't do much with that!"