(As at the time of writing,the world is rushing to contain the spread COVID-19 virus. Malaysia implemented movement control order (MCO) on 18th March 2020.)
We are now in May 2020 and Man, what a time to start blogging !!!!
My name is Sivasathish. I am a freelance lecturer teaching selected subjects in the Association of Chartered Certified Accountants (ACCA) course.
As freelance lecturer, I had the opportunity undertake teaching and training assignments in many countries including Malaysia (my home), China, Brunei, Laos, Vietnam, Myanmar, Singapore and many more.
2020 is my 10th year in teaching.
However, this blog is not about my teaching journey.
It is is about my thoughts on and to a certain extent, my personal finance journey.
Before I share more about myself, allow me to share an “eye opening” meet up I had with an ex student before the Malaysia came to a lock down.
Just before the MCO was implemented, I had the opportunity to meet an ex student of mine. His name is Ben. (Not his real name and I have done massive adjustments to the specific details. This has been published with full permission of the person concerned.)
Ben was one of my earliest and brightest students in my 10 years’ experience in teaching the ACCA qualification. He graduated with the ACCA qualification before 22. (Which is faster than normal)
Ben began his career in one of the top accounting firms in the country. He worked as an auditor and was brilliant at his work, getting FAST TRACK promotions and excellent bonuses from his employer.
After working as an auditor for few years, he moved on to a job as a manager in a top multi national company. I consider him a high flyer, having achieved 5 figure monthly salary before the age of 30. He is now 29.
We met for dinner at the iconic KLCC to discuss about life and work. During our conversation, I asked him about his current financial situation.
(Since I am his ex-lecturer, he was more than happy to share detailed breakdown about his financials, including his salary).
His financial situation….
Ben currently makes a five figure monthly salary. However, despite earning so much, he had minimum savings and investments.
Apparently, he had around RM 4,000 in savings a/c and RM 10,000 in his unit trusts, after being in the workforce for quite a number of years.
I also got to know that he had credit card bills worth RM 70,000. At present,he is only settling the minimum balances. He doesn’t seem to know or care about the “over the top” interest that he is paying to the bank on a monthly basis.
I asked him more questions to try to understand his lifestyle.
I got to know that he drives an expensive luxury car, having switched from his second hand car when it was only 5 year old.
Ben is currently staying in a luxury condominium, rented at RM 4,500 per month. He does not own any properties and his parent’s house is just few kilometres away from his office.
He is very fond of branded goods including clothing, watches, shoes, and etc.
His parents are not very well to do and he is the only child in the family.
Frankly, as his ex-lecturer, I was happy to see him growing so fast in his career.
However, I was concerned with his current financial situation. At this moment, I quickly raised a question to him:
With the oil trade crisis between Russia and Saudi,reduction in Oil price, and the impending impact of Covid 19 on global economy, will he be able to survive if his company decides to retrench or terminate his contract on cost grounds ?
He was caught by surprise with the question and obviously, was struggling to answer the question and admitted that he will not be able to survive for more than 3 months, if a retrenchment ever happens.
He also became very nervous knowing that its a real possibility and started showing some interest on how can he improve his situation.
I gave him some basic ideas but told him to research further through reading blogs, books and watching you-tube videos. Of course, I am not a personal finance expert and was just sharing the resources that were helpful to me for the last few years.
This got me thinking…..
Here I have one of my top students, who has poor financial literacy and was living on a paycheck to paycheck basis, with minimum effort to grow his wealth.
As a lecturer teaching the prestigious ACCA qualification, I used to feel very proud and happy to see my students graduating and moving on to progress in their life.
While most of them are doing well in their career as accountants, consultants, auditors and others but quite a number did not take their personal finances seriously, and so are heavily behind the game of building their net worth.
(Starting to build our net worth as early as possible gives us the opportunity to tap on the power of compounding interest and gives us the option of retiring early, if needed).Annonymous
(Accountants are known to be good when managing “other people”s money, but contrary to popular belief, quite a number of them seem to be poor when it comes to managing their own money).
My personal finance journey…..
As at the time of writing this blog post, I am still an ACCA lecturer, teaching nearly 1,000 ACCA students every 6 months, and I came to know that most of my students are still relatively new to the topic of personal finance.
Personally, I was very interested in the subject of personal finance when I was much younger.
At the age of 18, I worked as a librarian, book store operator and student consultant in my college. I was earning on average of RM 1,000 to RM 1,500 on a monthly basis while studying for the ACCA qualification. I would then put my savings in fixed deposits and unit trust funds.
After my graduation, at the age of 20, I moved on to become an auditor in firms such as KPMG and PWC (Price water house & coopers).
In fact, one of the saddest moment in life is celebrating my 21st birthday as an auditor, in my client’s office at mid-nite (if you know what I mean)……
After my stints as an auditor, I became an accountant in a multinational company for a few years. After which,
I decided to take the plunge into freelancing in my late 20’s and currently, I am a full freelance lecturer and consultant,providing advisory services to a number of small, medium and large companies.
Throughout all these years, I have been earning, saving and investing my money.
I am now in my mid 30’s, and I dare say the power of compounding interest has worked its magic for me for the last 10 years and more. This is possible only because I started my investing journey much earlier than usual.
I am still learning a lot in my personal finance journey and wish to carry on improving my knowledge.
Reflecting on my finances….
The movement control order in Malaysia means that every one (including me) will need to stay at home. Both my teaching and consulting came to an abrupt stop although I am now recording classes for my teaching.
This “flexibility” and “free time” has given me ample time to re-plan my personal finances.
So, while I was planning for my finances at home, I was thinking…..
“What if I can find a way (outside of classroom) to “share” my thoughts about personal finance to my current and ex students, who are at the beginning stage of their personal finance journey”.
(Please note that I used the word “share”, I am not here to “teach or educate” because I am not an expert.)
Obviously, I can’t be talking about personal finance in my classes. I have a syllabus to finish.
After much thoughts, I decided to share my experiences through the creation of a blog and here we are at Money Inspirations @ sivasathish.com.
While the blog is mainly catered for my current and ex-students, I also hope there are lessons that I can share to general readers, if you happen to stumble upon my blog on the internet.
Please let me repeat, I am not an expert……
Let me clarify, I am not a personal finance and investing expert, I made a number of mistakes in my journey in the past.
One of my regrets in life was to put a big chunk of my savings into fixed deposits. The annual returns of 3 to 4% was not even close to inflation. So i was practically losing money on a yearly basis. (Moving forward in 2020, the returns are expected to reduce to a much lower level with adjustments to interest rates by the Central Bank)
However, despite the lower investment returns. I believe I am relatively secured today due to my earnings and savings, I used to practice delayed gratification and focused on my earnings, when I was younger.
As such, In this blog, I hope to share the following (with maximum transparency, for the benefits of everyone.)
- My thoughts on Earnings, Savings and Investments (based on my own and other people’s experience)
- My new investment portfolios in 2020, utilizing tools such as Shares, Robo Advisors, and Unit trusts. (This is to make the blog a bit more interesting with performance reviews and introduce some real life content)
- Recommending other blogger’s posts and books for readers to consider for further improvements and understanding.
- Inspiring stories of how some of my ex students made it in “life.
- Other posts based on my job as an educator. This would be related to motivation and inspiration and may have a finance or non finance theme.
I will strive to make the contents of this blog SIMPLE and STRAIGHT FORWARD, keeping in mind that most readers (including my students) are “complete” beginners in their investment journey.
The contents of this blog may not be suitable for you if you are an experienced trader or investor. My sharing will probably add some value to complete beginners.
I am grateful…
If you have read so far, I would like to thank you from the bottom of my heart. I hope to be able to provide some form of value based on my failures and success.
I would also like to take this opportunity to thank Ms Suraya from ringgitohringgit.
She did an excellent job in providing a very professional service in setting up this blog. I would strongly recommend that you guys read the contents of her blog. I learned a lot from her sharing.
To my current students, happy studying.
To my ex students and general readers, wishing you all the best in everything you do.
Thank you for taking the time to read this post.