Sunday, April 27, 2008


It cannot be denied that shopping is sometimes therapeutic. It feels good to pamper yourself by buying something. Taken to shopaholic extremes, though, going out to the mall is extremely detrimental to your financial health.

One way I've found that really helps curb shopping impulses is to develop an interest or a range of interests that you're passionate about. it's so special to be able to CREATE, PRODUCE or GROW something with your own hands or your mind, rather than being passive consumers of what other people create. Try it, and you'll be surprised at how much pleasure it can give you, even if you're not that good at it.

I don't, for example, aspire to be a professional photographer. But I found that going out armed with my camera, keeping a look-out for interesting picture-taking opportunities helps me be more aware of the world and people around me. I noticed things about places, people, and the environment around me that I never saw before. And discovered that you don't need trips to far-off exotic places to find the unexpected, the different. And with digital cameras, you don't really need to spend a lot of money to keep up this hobby. Any photos that are simply awful? Simply delete them.

Don't let the desire to be 'perfect' stop you from enjoying what you yourself can create or produce. So what if your potatoes don't look as pretty as the ones you find from the store? It's the joy of the process of planting that matters. Same with writing or craftwork. They don't have to be professional or great. What's important is that you enjoy it.

Step 1: Write down your favourite activities. Also write down the items you love most in your room. What do you look forward to doing? What do you look forward to having?

Step 2:
Think -- is there some element of any of those activities or items that you can make/create/grow/organise yourself? For example, I love beautiful images and photographs. That's why I decided to bring a camera along everywhere I go.

Step 3: Develop your interest step-by-step, at your own pace. What's important here is to make your interest your own personal haven, rather than approach it with a competitive attitude, or with the attitude that you have to be best. The key goal is to enjoy it.

Although making money should not be the goal, eventually you may even be able to make a small business out of your interest(s). Good at making greeting cards? Why not sell your unique creations? Or your woodworking skills have become rather good -- there are people out there who would appreciate custom handmade items.

If you have any hobbies or interests that you're passionate about, why not share with us on this blog? Tell us how it has helped to make your days more fulfilling.

Wednesday, April 23, 2008


This week, a young friend, Jesse, is getting to go see Clay Aiken in Spamalot, on Broadway.

She wanted to go see Spamalot, but her family thought she was just a bit too young to fully appreciate the musical. So she made a deal with them - she gets to go if she can raise the money for her ticket. Her aunt agreed, not imagining that she could get that much money. But she did it, by determinedly doing chores for friends and family.

Now, that's the power of having a goal.

There are two types of goals that we should plan for - short-term goals (like a computer) and long-term goals (like college).

Let's start with short-term goals for now:

1. Set your goal. Think about what you need or want in the near-term, for example, a mobile phone, a computer, or maybe that latest Paramore CD. Or set a goal to get something for someone else. For example, if you know that your brother would love to have an MP3 player for his birthday, why not make that your goal?

2. Figure out how much more you can save each week if you cut out some non-essentials from your usual spending (like snacks and small knick-knacks). Don't dip into the amount you're already setting aside as your Savings -- that can go towards your long-term goal(s).

3. Set a date for achieving your goal, a date not more than three months away.

4. Develop a plan to reach your goal. Will the amount you save each week from cutting out on non-essential spending be sufficient for you to reach your goal? If not, perhaps you can earn some money -- tutor someone younger than yourself, babysit, do various chores for friends and family, run a lemonade stand, etc. If you're old enough, you may want to get a part-time or weekend job.

4. Keep to your plan. Sounds simple, doesn't it? But it's so easy to give up halfway. To motivate yourself, visualise your goal in your mind every time you're tempted to give up.

Tuesday, April 22, 2008


We often thoughtlessly throw away things which are still fairly new just because we want something newer and trendier. And we send a lot of packing and packaging materials to the trash, from plastic bags, to boxes, containers, cans and bottles. So what can we do to minimise this waste of earth's resources, and earn or save money at the same time? Here are a few ideas:

1. Getting bored with your t-shirt, sneakers or bags? You may like to experiment with dye and fabric paint to make them seem all new again. You will probably impress your friends with your one-of-a-kind creations. Or do your bit to help the less fortunate by donating items you no longer need or want to charity.

2. Reuse containers to store and organise your things. Or decorate boxes, bottles, cans and other containers to use as desk accessories.

3. Instead of buying garbage bags for your wastepaper basket, use the plastic bags you get from stores instead.

4. Scour garage sales and flea markets for secondhand items.

5. Try to resell items you no longer need. For example, if you look after your textbooks, you can probably sell them at the beginning of the next year to other students.

Any other ideas? Share them with us here.

Tuesday, April 15, 2008


In 2000, MacDonald's in Singapore sparked off a Hello Kitty Craze. People were going crazy over pairs of Hello Kitty dressed in wedding costumes. A different pair was offered every week. The first pairs released by MacDonald's quickly sold out, and people started offering high prices to people willing to resell theirs. Within a short time, prices on the resale market reached ridiculous levels. Profiteers started queueing up for the latest pairs released every week (for the express purpose of making a quick buck by reselling them), creating an even greater supply crush. Suddenly, these dolls became must-haves, worth queueing up hours for. Even people who would never ordinarily buy toys, or have no interest in Hello Kitty, started trying to get hold of them.

I remember that year, a friend of mine queued up for at least half a day to get the latest pair of Hello Kitty dolls. When she managed to snag a pair, someone approached her and offered more than $500 for it. What had it cost her? Less than $5.

Of course, as such crazes go, the demand tapered off after a while. A few years later, the same dolls could be found a-begging at night markets for about $2 a pair.

The lesson here? Be careful when people start rushing to buy a certain item (whether it's Hello Kitty dolls, shares, or homes) and prices start going up very fast. If you have that item and you can make a good profit from such irrational demand, it's time to consider cashing out.

And more importantly, if you're tempted to join the rush, be careful of paying prices which cannot hold up over the long run. Think of the people who had paid hundreds of dollars for these Hello Kitty dolls. Today, those dolls are worth almost nothing.

On a related note, think carefully when buying anything that's 'in' or 'trendy', even when the prices are reasonable. Ask yourself: Do YOU really like it? For example, if you don't enjoy Harry Potter that much, why be the first in line to buy the hardback edition on the first day just because your friends plan on doing so? Remember the opportunity cost. You could be spending that money on something else that YOU really, really want.

Monday, April 14, 2008


1. Put just enough money for a day or two in your wallet.
This is very effective in curbing impulse buys.

2. Wait 7 days before buying.

You may be surprised at how often something appears much less attractive after you walk away from it.

3. Bring a water bottle with you whenever convenient.
Buying a drink or two when you're not at home can add up to quite a lot of money.

4. Cut down on sweets and snacks.
Not only will you save money, you'll be healthier too!

5. Get a library card.
Nowadays, many libraries are well-stocked not just with books, but also DVDs and CDs. You can also read your favourite magazines at the library.

6. Love shopping? Develop an interest in bargain-hunting.
It makes me feel really clever if I manage to find something for a lot less than what other people paid. And it's also lots of fun hunting for unusual things (which don't necessarily cost a lot) at garage sales or flea markets, rather than always buying at the shopping mall, where you're likely to get exactly the same thing that your friends already have.

7. Find interests besides hanging out at the shopping centre or mall at the weekend.
Try various activities to see what you enjoy. For example, if you get a kick out of volunteering, do that. Or if you're creative, why not develop art and design projects, or make crafts, or write. It can very liberating to be able to express yourself in your own way. Gardening can be a joy as well, if you love plants. If you enjoy working up a sweat, try participating in group sports -- you'll have fun, and make friends too.

8. Spend your spare time earning money, not spending it.
It can actually be fun to work. Try to find something you enjoy. If you love kids, why not tutor or babysit. One of the best jobs I ever had was working at a golf club (in the locker-room). I enjoyed the routine of cleaning -- it was a good change from studying, and the physical work actually made me more energetic. Love pets? Find a job at a vet or a pet shop, perhaps.

9. Find something you want, and save towards it.
Think of something you really like and want, and plan to save towards it. It should be something that excites you -- perhaps that MP3 player you've always wanted, or a laptop computer. Having a goal will help you cut down on frivolous spending and impulse buys.

10. Think up ways to save money.
Come up with any good ones? Do share with us on this blog.


When I spend, I've found that it's extremely useful to think about the 'opportunity cost'.

For the purposes of talking about money management, we'll definite opportunity cost here as the cost of what you give up when you make a particular spending choice.

Let's look at a simple example: You spend $2 per day on snacks, or a total of $10 per week. A movie also costs $10. If you hadn't spent that $10 on snacks, at the end of the week, you could have gone to see a movie. So, the opportunity cost of spending on snacks is a movie.

So, next time you see that watch you absolutely must have, or that game you just can't resist, ask yourself: What's the opportunity cost? What if you don't buy that watch or that game? Could you buy something else that's even better with that same amount of money? Or could you have put that money towards something that's more important to your future, like your education? If you do this, you'll find that you'll start making better choices.

Friday, April 11, 2008


Trap #1:
"All my friends have it!"

Trap #2:
"I want to be like my favourite celebrity!"

Trap #3:

All of us have fallen into these traps at one time or another. It's only normal to want to fit in with our friends, or possess the latest or coolest or best things.

But why just hand over your power to make decisions to your friends, your idol or the brand?

If all your friends are buying the latest mobile phone with lots of features like camera, WiFi and MP3 player, BUT you really don't like taking pictures, prefer to surf the net using your laptop which has a screen and keyboard which you find way more comfortable, and you already have a very good MP3 player which you find very convenient to use. Should you also just blindly spend $500 on that mobile phone when you can probably get a great mobile phone for $100 which fits your needs better?

So what if your hero is endorsing a particular type of sneakers? He or she is being paid to wear the thing. You decide for yourself whether it's for YOU.

As for brands, yes, some brands do offer great value even if they are really expensive. Their products are the result of great craftsmanship, creativity/uniqueness and innovativeness. And it's right that we should pay for such a great product, if we can afford it. But, nowadays, just as many brands slap their name on a rather generic product, and you end up paying a lot just for the addition of their name. For example, if you need a basic white tee, look for a good-quality non-branded one. Nobody will be able to tell the difference. Another danger when basing purchasing decision on the brand is that you run a high risk of buying something fugly just because a 'cool' brand tells that's the in thing this season.

That's not to say that you shouldn't look for cues from your friends, from celebrities, or from top brands. For example, if Clay Aiken tells you that "Kite Runner" is a great book, look it up on the internet. What are the reviews like? Does the book sound like something you'd like to read? What do other readers think about it?

In other words, ask the right questions so that what you buy suits the unique person that you are. It's your money. Only YOU get to decide how you spend it. Why let outside forces dictate and control what you buy?

So ask yourself:
1. Can I or my family afford it?
2. Is it within my budget?
3. Is there a similar item available that offers more value for money?
4. Does it suit my personality, personal style and taste?
5. Does it suit your lifestyle?
6. Does it fit my unique needs?

Thursday, April 10, 2008


In this post, I'm going to talk about creating a spending plan.

We'll start with a very rudimentary plan, created by following the 4 steps outlined below. Remember, it's more important to have a plan you can easily follow than to rush into making the perfect spending plan. After all, the goal is to develop habits which will last you a lifetime.

STEP 1: Find out what you currently spend your money on.

Before you start planning how to spend your money, it's important to know your current spending pattern. So note down everything you buy over a typical week.

STEP 2: Identify what you really need.

Take your records from Step 1, and divide the items into two lists:

a) Basics List

Put the items which are absolutely necessary on this list. Be honest when making the list -- make sure you don't sneak in items that should count as luxuries. For most young people, the list may include food, drinks, commuting costs (petrol or bus/train fares), and other expenses related to school.

b) Luxuries List

This may include items like CDs, magazines, snacks.

STEP 3: Work out your budget.

This part is just simple arithmetic. Total up everything on your Basics List, and use that amount as a guide to start your first simple budget.

For example,
If your Basics add up to $35 every week, and you have $45 every week in your Spend Box, that means that your Spending Plan should look like this - $35 for Basics every week, and $10 for Luxuries.

Step 4: Stay within that budget.

Now that you've worked out your how much you can spend on what, just do this one thing. Use the simple plan you worked out in Step 3, and keep track of what you spend on Luxuries and make sure you never spend more than what you've budgeted.

There's of course much more to great money management than this, and we'll deal with those in later blog posts. The important thing is to make a 'baby step' and make sure you that you keep on walking. If you do fall, pick yourself up and start again.

As you master this one thing -- putting a cap on your spending on Luxuries -- you'll be more prepared to learn how to make the larger steps we'll be discussing later.

Wednesday, April 9, 2008


Have you tried sticking to a budget and failed?

Then you may be using a method which is too complicated to follow. Some budgets ask you to note down all your expenses every day. Others advise you to spend as little as possible, which makes it as palatable as a diet!

But budgeting need not be hard or torturous. Once you get the hang of it, I bet you'll even enjoy taking charge of your money. What you need to do is take control in a way that's comfortable for you.

We'll start with a method I've found very useful. Some people call this the 3S Plan. All the plan asks you to do is divide up your income into SAVE, SHARE and SPEND boxes.

Step 1: SAVE
This should be your first priority. Take your income -- your allowance plus any other money you get on a regular basis -- and put part of it into your SAVE "box". Decide on the amount before you get your allowance each week or month. This way, you won't be tempted to put less into your SAVE box once you get the money in your hands.

Start with an amount that's comfortable for you. For example, if you get $50 every week, you may want to start by setting aside 5% or $2.50 per week into your SAVE box. You may want to work up to 10 or 15% or more as time goes on.

Step 2: SHARE
If you have an income, setting aside even a small amount every month can go quite a way towards helping people who really need it. Again, start by putting an amount into your SHARE box that's comfortable for you, and work up as you adjust your spending.

Step 3: SPEND
Put the rest of your income into your SPEND box.

If you get $50 every week,
and decide to save 5% and share 5%,
this is what your three boxes will have
at the beginning of each week:
SAVE: $2.50 per week
SHARE: $2.50 per week
SPEND: $45.00

In my next blogs, I will discuss what you can do with the money in each of the three boxes.

So, look out for the next part where I will talk about the SPEND box and how you can make sure that you have enough money for everything that you need.


An ALLOWANCE, a fixed amount of money given to you every month, helps you to learn money management skills.

An allowance is like an "income" that that an adult gets, except that you don't have to go out to work to earn it. You should be mindful, however, that you're getting the money because you're part of the family, so you should fulfill your responsibilities around the home -- chores, studies, etc. Getting an allowance allows you to take your first step towards managing your money like an adult.

Why limit yourself to an allowance?

Now, you're thinking... but but but my parents now give me money whenever I need it. Wouldn't it be stupid of me to change this?

Think about it. There are benefits for you as well. If you get an allowance, you get to be more independent, and have more control over how and when you spend or save your money. Even more important, when you have a steady "income", you will start learning important lessons, including:
  • how to be responsible about money.
  • how to save for what you want.
  • how to make decisions on what to spend on.
  • how to get the most value from your money
  • how to make your money grow, etc.
You will probably make some mistakes, regret some of your decisions or choices, but you will learn from them.

Discussing it with your parents

If you do not yet have an allowance, you may want to discuss the subject with your parents. You'll probably want to discuss the following:
  • why an allowance is important.
  • the amount to be given to you weekly (or monthly).
  • what you have to pay for out of that allowance.
  • what your parents will still pay for.
When discussing with your parents, do keep in mind that you should respect their thoughts on how much you should get, what the money can be spent for, and what it can't be spent for.