She was talking about buying a beautiful eyeshadow, which was on sale at Tampines Point.

As she knew that I am a prudent and careful buyer, also a voracious saver, she asked me for help……. She asked me to motivate her, not to succumb to the temptation of forking out HUGE dollars from her wallet, to buy the beautiful eyeshadow……..shehasmanyofit

Did I succeed to convince her? The answer is a miserable, NO!

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Today, I am going to share with you, simple yet pragmatic strategies on how, I curb myself from squandering and spending all my money on things that, I may not need.

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Strategy No 1: Stop before you buy

The first strategy to curb yourself from spending is to procrastinate in buying…

Keep telling yourself, that you are going to buy the stuffs that you are looking at, the next following day.
I assure you that you will soon forget about it.

Tell yourself, “Do I really need this?”

How  many hours, must I work to get back this money?  How much is it worth, if i invest it @10%/annum in 10 years, 20 years, 30 years?

Strategy No 2: Pay yourself first

When you get your income, pay your personal savings plan first. You can instruct bank to do an automatic deduction to your personal savings plan. You can get endowment plans, or invest in funds, stocks or commodities like gold…

By setting aside that money for savings seperately, you will reduce the tendency to spend all that you have at once…

Strategy No 3: Destroy all credit cards except one. and pay full balance on time

Have you ever wonder, why the banks keep offering you attractive freebies, reward points and rebates if you sign up for their credit cards?

It is because, they know, when you have a credit card, you will tend to spend MORE when you have access to this easy credit…. They want you, to owe them money and pay interest…

My recommendation for you, is that, only keep one credit card for use, and pay the full balance on time….

That’s it!!! I hope, the 3 strategies, that I share with you, will be of much help for you to curb yourselves from spending over your limits….

My other related posts that may interest you:

• How To Motivate Yourself To Save More Money?
• Investment That Can Give ROI of More Than 1000%
• Powerful Strategy To Save Money

If you are a financial planner, like me, you will definitely reach out your financial calculator and punch in these figures, to get the answers. idoiteveryday

Set: End
n: 10
i%: 9
PV: -10,000
FV: Solve

…..and in an instance, you will get $23,673.63

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In my “financial planning for wealth manager” (catered for high networth individual) class, I learnt to calculate the answers, without using a financial calculator. You can use a normal, scientific calculator to get the answers.

How do you do that?

You can calculate it this way…..Use this formula….. Principal (1+interest)^{number of years}

Just take 10,000 (1+0.09)¹⁰  = $23,673.63

Easy right?

For now, just remember this formula. In the next blog post, I will share with you the intricate mechanics of this formula. Share this blog post, if you find it useful!

My other related posts that may interest you:

• Should you pay your car in full OR take a car loan?
• What Is The Single Most Important Lesson You Learnt In Personal Finance?
• You CHOOSE How You Will Like To Response To Your Challenges

I have some clients, who asked me, “Financial Consultant, Helmi Hakim….I want to buy a car. Should I pay it in full OR take a car loan?”

Well…If you have been reading my blog, for the past few years, you know, that I have been advocating that buying a car, can be both an asset or a liability.It depends on your situation. You can read more here.

But, now, let us focus on the question. The question is, “Should you pay your car in full OR take a car loan?”

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My answer: It depends.

To know,whether you should pay your car in full or take a loan, you will need to calculate the “effective interest rate” of your car loan.

“If you can invest your money, and get higher returns than the effective interest rate of your car loan, you should invest your cash and take a car loan.

If the effective interest rate of your car loan is higher than your investment return, you should use your cash to pay off the car ASAP.”

I will give an example to illustrate my point.

Car HP (Hire Purchase)

Price:               $65,000
Less Deposit    15,000
HP Principal     50,000

Example, the car, that you will like to buy costs $65,000.  You pay a deposit, of $15,000.  So, you will be left with an outstanding hire purchase principal of $50,000.

If your car loan interest is 5% “Flat” for 5 years,

Add Hire Purchase Interest
$50,000 X 5% X 5 = $12,500
Total Amount Payable Including Interest  = $62,500
Monthly Instalments= $62,500/ (5 years X 12 months) = $1041.67 per month

You need to pay a monthly instalment of $1041.67 for 5 years.

So, how do we calculate the “effective interest rate” of your car loan from here?

Take Out A Financial Calculator.

Key in this input. Solve for i (interest).

PMT = -1041.67
PV= +50,000
n= 12 X 5
i = ???

Solve for i and you will get 0.762817% interest per month. Multiply it by 12 months, and you will get  the effective interest rate of your car loan, which is 9.15% per annum.

It means, if you have $50,000 cash right now, and your investment skills allow you to generate investment returns of more than 9.15% per annum, then you should not pay your car in full.

However, if you cannot get such a spectacular return, it is best, that you pay off your car loan as soon as possible. Hope my sharing helps! Click share if you find it useful! 

My other related posts that may interest you:

• Should You Take Housing Loan or Pay Your HDB House In Full If You Got The Money?
• Some Questions & Answers On NTUC Income Flexi-Cash
• Debts: Are They Bad Or Are They Good?

It is definitely challenging for me, to juggle both work and study at the same time, but I guess, I will soon, get used to it. I am thankful, that my job, as a financial consultant, is pretty FLEXIBLE.

We can make appointments as and when we want. We can postpone appointments, when the exams are drawing near….all in all, while still maintaining our steady paycheck. Isnt that cool?

All right…. As I undertake my studies, I will share with you, stuffs, that I learn in school, which I believe, can be applied in the business world. Let us start, with MAKING DECISIONS…

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In life, we are bound to make DECISIONS.

It may be a big decision or a small one to make.

It may be a simple one, or a life threatening one.

It may be a routine one, or a ONE TIME decision.

Today, I am going to share with a you, a very good decision making model, that I have personally learnt in class and then apply, in the real business world. Just browse through the slides below to get an idea…

(Note: Some details were omitted due to confidentiality)

Lastly, after computing and tabulating the scores, a final decision is made!!!

My other related posts that may interest you:

• $100,000 in 10 Months- T Harv Eker Guerilla Marketing In Action…## Strategy 1
• Review On Quality Leadership and Life Management Training @ Istana Kampung Gelam…
• Start With The End In Mind

Election Is Coming……What is on your wishlist??? Do share with us here……

My other related posts that may interest you:

• Huge, Drastic & Mind Boggling Transformation Coming Your Way @ HelmiHakim.com
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• I am Home Alone….