Round 2 results
Kuda Vidanage Deepthi S. (User Experience Centre)
Self Control – The Key To Financial Decision Making
Our parents and grandparents lived in an era where money was scarce and hardly enough for daily necessities. Under those circumstances, their strategy was to squirrel away whatever little they could to grow their savings and to eliminate (or delay) unnecessary expenditures.
Fast forward to the times we live in today. Many families have the means to pay for their daily necessities… and more. Retailers and marketers realise this and they make big plans for OUR MONEY. Whether they are shopping malls in our neighbourhoods or online stores overseas – their goal is the same – to seduce us to part with our money.
Some of us exercise restraint and refuse to be seduced. Others fall headlong into the trap for various reasons. Sometimes it is because they want to be among the first to get that cool item so that they can earn bragging rights amongst their peers. Over time, this desire for self-gratification becomes a lifestyle habit and the propensity to spend overrides the propensity to save.
The good news is that we can learn to exercise self-control. Here are 3 ideas to help you get started:
- Take your time (hours or days) to evaluate an intended purchase. Don’t rush to spend because speed kills!
- Ask yourself a series of hard questions. Include questions like “Why do I need to make this purchase?” and “Will this purchase satisfy a NEED I have or a WANT?” (Learn to say “NO” to the latter.)
- Define your own spending limits and stick to them. Research tells us that self-imposed limits help to increase self-control. Self-control is about knowing you can but deciding that you won’t.
Lee Tiong Seng Norman (School of Mathematics and Science)
Being Money Sensible
I invested a sum of money when I was an undergraduate during the dot com bubble of year 2000, and till today, despite assurances that the stocks will recover one day, I have realized a loss of 75% today, 14 years later. However, that was a valuable experience. This experience taught me that I had to be aware of the situation in the markets myself, and not depend on the financial adviser alone. The memory of this loss helped me to stay away from the structured products which many financial institutions were selling prior to the collapse of Lehman Brothers in 2008. I learnt to be careful and do my analysis before making any trade in the stock markets.
This experience also spurred me to read up on the basics of financial planning and the various options of investment, which includes stocks, bonds, exchange traded funds and other instruments. I read about the need to ensure that I have sufficient funds for 6 – 12 months of expenditure before investing, something that I still advise younger friends to do. I was attracted to exchange-traded funds as a low-cost alternative to unit trusts. I read up on the various types of insurance policies available, and decided to avoid investment-linked insurance due to its high costs. I learnt that credit cards can be a useful tool in managing my finances, and till today, I ensure that I pay my bills on time and do my research into which card gives me the best deals.
Ultimately, I realized that the basics of managing finances don’t change – live within one’s means and to stay away from what you are not familiar with.
Dexter Choo Wei Cheong (Diploma in Business Administration)
How do you save money effortlessly?
“Grow a tree today, you would not have to sit under the sun for the next 10 years”
Today I am going to show some of the essential money management tips which was ingrained into me since I entered poly.
1) Save before anything else.
Commit yourself to a savings target monthly. Put down in writing the exact amount you want to save a month and force yourself to keep to it. I personally have opened another separate account to help draw a clear demarcation between expenses and saving. This account will only be used for savings and no link to bill payments. Every month I save at least 20% of my pocket money using the regular savings plan my various banks.
2) Reduce on seemingly small expense items.
Entering poly, some of you might be tempted to cab to school because of the long distance. However, cutting down on taxi rides to school can save you a whole bunch! Imagine saving $10 on one trip, you effectively save $50 a week and $200 a month! (Assuming you cab daily)
3) Live within your means.
The main point here is not to live like a beggar. Instead differentiate between needs and wants.
Needs are things that we need to use on a daily basis. This include the bread we eat etc.
Wants are items we do not need to survive. Nonetheless, it is good to have them. Some examples are the latest mobile gadgets, overseas trips etc.
By coming out with a list of our needs and wants, we should spend the bulk of our pocket money on our needs and cut down on our wants.
Why should we do so?
When we are young, we should practice delayed gratification. This allows us to enjoy later on!
Merit Prize Winners for Round 2
Lim Xiu Ru (LIB)
Willy Koh Zheng Yi (Diploma in Interior Design)
Tay Jin Ying (Diploma in Computer Engineering)
Yang Fan (Diploma in Electrical and Electronic Engineering)
Tay Wei Fan (Diploma in Optometry)
Rowell Quek Hui Qi (Diploma in Business Administration)