My dad once told me to have 6 months of salary tucked away somewhere safe, to be kept in case of rainy days. That was some 7 years ago when I first started working. I had no worries back then, no car loans / housing loans / insurance (both car and personal) and whatever I made was strictly for myself only. Did one not use a poncho or an umbrella when its raining?
Some people pay one month of their monthly salaries to attend personal finance seminars and they are told to keep 3 months of their salary away for rainy days. Am sure glad my dad did not charge me that much. All I had to give him was 5 minutes of my time. Those who paid one months salary to be told they had to keep 3 months salary away has been suckered in my opinion.
And then, I met an entrepreneur who told me to keep away 8 months of my salary someplace safe. Under the pillow perhaps, or should I dig up my floor to put away 8 months of salary. I know not what people practice but one thing is for sure, many in my generation (less than 30 years of age) do not safe money at all.
Now, that my friend, is extremely dangerous. I overheard this recently in a language which is not foreign to me but its not in English (figure it out yourself).
Short haired stranger : Why don't you buy this? Its better to invest in one of your own than to rent all the time.
Balding stranger : No money la; so expensive, if I buy this, I will have to play every weekend to bring the cost per play down.
Short haired stranger : No worries bro, just use credit card. Sign on the dotted line only and it is yours. I also did that, then pay monthly, just pay what you can. As long as you pay monthly, its ok wan... the banks wont come after you. Some more get more points can change for shopping voucher.
I for one, certainly do not condone the above "overheard" conversation. 6 months tucked away is comfortable enough and is easier than you think it is. In essence: -
Some people pay one month of their monthly salaries to attend personal finance seminars and they are told to keep 3 months of their salary away for rainy days. Am sure glad my dad did not charge me that much. All I had to give him was 5 minutes of my time. Those who paid one months salary to be told they had to keep 3 months salary away has been suckered in my opinion.
And then, I met an entrepreneur who told me to keep away 8 months of my salary someplace safe. Under the pillow perhaps, or should I dig up my floor to put away 8 months of salary. I know not what people practice but one thing is for sure, many in my generation (less than 30 years of age) do not safe money at all.
Now, that my friend, is extremely dangerous. I overheard this recently in a language which is not foreign to me but its not in English (figure it out yourself).
Short haired stranger : Why don't you buy this? Its better to invest in one of your own than to rent all the time.
Balding stranger : No money la; so expensive, if I buy this, I will have to play every weekend to bring the cost per play down.
Short haired stranger : No worries bro, just use credit card. Sign on the dotted line only and it is yours. I also did that, then pay monthly, just pay what you can. As long as you pay monthly, its ok wan... the banks wont come after you. Some more get more points can change for shopping voucher.
I for one, certainly do not condone the above "overheard" conversation. 6 months tucked away is comfortable enough and is easier than you think it is. In essence: -
- Pay your bills on time and in full
- Save a fixed amount every month
- Get insurance!! (no, I am not an agent, I just believe in it)
- Put away a little every month for a holiday; never failed to show me the positive of things after a holiday
- Invest only if you have extra monies (do not touch that 3 / 6 / 8 months tucked away)
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