Today, I met a very good friend for lunch. Let’s call him W.

W and I go way back but it’s sad that because now we’re older and have our own families, we don’t get to meet up very often. So it was nice to catch up over lunch since we both happened to be free today. The nature of W’s job is that W doesn’t have to be in the office all the time. In fact, he’s rarely in the office because as long as he has a phone and tablet computer, he can work.

So, it was with great sadness that our lunch was kind of ruined by a barrage of calls that he had to answer. And through the course of lunch (when we weren’t interrupted by phone calls), I had the sensing that here I was, talking to someone who is like most other Singaporeans (or “people around the world”?) who think that the path to life is one that involves being an employee for life.

What I mean is that most people think that the best way through life is to work for someone or some organisation, get paid and eventually, after years of working, they will officially retire. So what makes me different? Well, some 10 years or so ago, I happened to pick up a book that you’ve probably heard of. It’s called “Rich Dad, Poor Dad“.

Now, I know the author Robert Kiyosaki has received some flak over the years. There are allegations of him being a fraud as far as his real estate investments go or how the specific advice in the book is but that’s not my point. My point is that his book, together with the other one called “Cashflow Quadrant” introduced me to a way of thinking that is so darned simple and yet so illuminating that I don’t know why I hadn’t thought of things in this way before.

Basically, those two books taught me that life doesn’t have to be about working for someone, earning a paycheck every month and then spending that paycheck on stuff that I don’t really need. It basically introduced me to the idea of being an investor.*

Technically, I’m still an employee but in reality, I’m probably half employee, half investor. Every month, I channel a portion of my income to a portfolio that continues to generate money for me and if I bothered to channel a larger portion, I would probably be officially retired by now but that’s besides the point. The point is, the math doesn’t lie- a 10% rate of return doubles your initial sum every 7.2 years. So someone who starts out with a lump-sum of S$10,000 at the age of 25 could easily be looking at a total net worth (assuming this portfolio is his/her only asset) of S$80,000 by the time he/she is around 46 years old.

Honestly, that illustration is understating a lot of things because the average graduate from university (in Singapore) earns anywhere between S$2,500 to S$3,500 per month. Just saving a month’s pay (not difficult at all) will cause the $10,000 to have a return of between 25-35% which leads to a doubling within 2-2.8 years. It’s only after getting into the range where saving four-five figure sums hardly budge your portfolio that it gets difficult but guess what, by then, you would be far better off than the average person. I know because I’ve been there, done that.

So, for those of you struggling with debt and finding that your life is like a hamster’s wheel, let me tell you that it doesn’t have to be. Just suck it in (difficult but necessary), pay off that debt , save lots of money and learn how to invest all that cash. If you can do all that, you’ll be thanking me later on.

For those of you that can’t see the logic, pray tell, let me know what’s stopping you.


*If you’ve read the books, you’ll know that the paradigm shift is really about becoming someone who works for money to being someone that knows how to make money work for them.