Can My Impossible Dreams Really Be Achieved?

A true MyPF story from one of our clients about her lessons learnt in achieving impossible dreams.

When you have impossible dreams, you find out about the people around you – who supports and who disagrees. When you achieve your impossible dreams, you find out about yourself. This is my story of how achieving my impossible dream set me on the path towards financial freedom.

Contents

Weddings are Expensive, Especially Nice Dream Weddings

I started my journey towards money-wisdom with a simple setup: a dream and a savings plan.

Year 0 – Lifestyle

I started working not too long after completing my bachelor’s degree. My pay then was a modest sum each month, as befits a fresh graduate. I considered myself frugal because I didn’t splurge on designer clothes, I didn’t take expensive overseas holidays, I drove a locally-produced car, and I was even still staying with my parents. My weekly visits to any of the shopping malls were mostly window shopping than actually buying anything at the mall. Yet, it seemed that my money was shorter than the month was long!

Year 1 – Saving

As time went by and my salary increased, I still couldn’t save much. This despite having a very strong motivation – to save for my wedding of a lifetime. My dream was to have a beach wedding and after doing some research, I wasn’t quite as optimistic anymore. I was ready to let go of my dream if not for my money-wise fiancé. Somehow, he had found out about my money saving struggles despite my not telling him about it. Thankfully, he then taught me the concept of paying myself first. He helped me go over my cash flow to understand how much we were working with and set up auto-transfers of funds via my online bank account. Without further ado, I was automatically saving a cool RM2,000 into separate and not-so-easily accessible account every month, which I then promptly forgot about.

Year 2 – Reaping

A year later when we sat down to do serious wedding planning, I was surprised to see RM24,000 in my bank wedding fund account! It was surreal. For the first time in my life, I had managed to save so much! And, just by simply setting up an auto-transfer feature. At that moment, there was a glimmer of hope that perhaps I could have my dream wedding after all.

Year 5 – Realizing My Dream

3 years later, we really did have our dream wedding at a beautiful beach-side hotel in Penang island underneath the stars and serenaded by the waves. We had saved up a six-figure number for our church wedding in KL followed by a Chinese 8-course dinner, and of course our dream beach-side wedding in Penang. We even had more than enough to splurge and get our favorite band to perform at our wedding. ‘Til this day friends who attended our wedding remember it fondly. Thanks to my money-wise hubby who encouraged me to save and helped automate my account; my dream wedding that seemed far-fetched 3 years before had became a dream come true. Truly, the impossible had become possible!

As simple as my dream wedding story is, I learnt that money just has its way of slipping away if we don’t stash it someplace safe and far from easy reach. In fact, since then I’ve learnt about more than just saving my money in a regular bank account. I’ve since learnt about the power of compounding where even a one-time RM10,000 saved in a low risk investment giving 4% annual returns compounded over 10 years would yield an extra RM4,800 (or total returns of 48%!).

3 Important Lessons I’ve Learnt

Tucking away 7 years of marriage to my money-wise man, I have learnt a few things despite my lack of background and interest in finances.

Firstly, I learnt that saving is the first step towards achieving my financial goals, dreams and aspirations. There are no short cuts to that but it just takes discipline to pay myself first. A good rule of thumb to start out is to have 6 months’ worth of your income in your bank account before using the extra cash for investing which is the next step. To get a more accurate sum to save before you invest, do take this short quiz.

Secondly, I learnt to delay gratification and invest for tomorrow. Earning an income is sufficient to survive but it is imperative to invest your hard-earned money to live a more comfortable life. For me, this was to have a little bit extra for traveling, eating out occasionally, and just having peace of mind for my future retirement years. Investing requires having a plan and being diversified while not being greedy. Sounds like a mouthful but it’s really doable once you break down your plan into small, achievable actions you can take over time.

Last but not least, I learnt to approach my personal finances as a team effort. My husband and I regularly talk about our finances with our licensed financial planner. Our financial planner knows our goals and dreams including our plans to raise a family, our dream home, and to retire early comfortably. Our financial planner also provides us access to an extended team including lawyers, financiers, and tax specialists based on our needs. I am so at ease knowing that my finances are in order and I have a team of people who care about my financial well-being rather than shoving products into my face just to earn commissions! It is important to work with a financial planner whom you trust because you have to be honest with your financial situation to receive accurate help and that he or she places your needs first.

When Yogurt is More than Just Yogurt

For the longest time, I would often buy what is cheap instead of considering the value of the item. The old me would have taken the cheapest brand on the shelf, deprive myself, and end up feeling poor.

This was until I learned to view where I put my Ringgit in terms of value. For instance, my favorite brand of yogurt costs RM5 more for a 1kg tub compared to other brands of yogurt available. I began to look beyond the slightly higher cost but to see it in terms of cost per unit (RM/g), nutritional value (which is important to my overall health), and even the joy derived from eating it! We are all too familiar with the psychology of deprivation, especially when it comes to dieting which often result in bad repercussions.

Cheap does not equal value. The key here is to invest in something that has value. So, how do I ensure that I value invest? An example would be to invest in equities whether directly in stocks or through a fund. If there’s a company or market sector you are interested in owning or believe in, go ahead to check it out in more detail. A publicly traded company’s financial records are freely available online. First, you need to calculate how much you think the company is worth per share on your own or get access to investment insights (Editor: Check out the FREE Premier membership 15-day trial for our investment insights). Next, check the price per share that the company is offering. If your fundamental analysis (FA) shows that the company is offering lower than what you calculated, it is then good value for you to invest in that company. If the price offered is higher, then it is not good value for you to invest in it.

Having said that, it is not everyone’s cup of tea to learn how to select and build your investment portfolio. Everyone has different interests and strengths. For example, someone with a financial background may not necessarily have the time or interest to do fundamental analysis. So, do what you do best and enjoy while leave the rest to financial professionals who focus on financial areas of expertise.

Conclusion

“What you do today can improve all your tomorrows.” – Ralph Marston.

We don’t know what tomorrow holds – we don’t know what’s going to happen in a decade’s time, a year, or even the next hour! The little that I choose to do (or not do) today will affect me sooner or later. We have all been there before: procrastinating, forgetting, missing opportunities and the list goes on. Choose today the habits you want to start cultivating, which to stop and which to do more. This applies to all aspects of life. Ten years ago may have been the best time to save and invest. But if I did not start a decade ago, the next best time is today! No matter your age, it is not the time for regrets.

I choose today to start putting down in words my financial goals and taking action to realize them. Sure, I may not have the necessary skills or time to screen through thousands of investments opportunities which are increasingly complex nowadays. But what I can do is I to approach a licensed financial professional to assist me. And a good financial professional firm would be backed up by an entire team who would be able to provide support, insight, and assistance in all my financial needs from investing to wealth distribution.

Many have the misconception that one must be a millionaire before justifying needing a financial planner. Or, we think that hiring a financial planner is expensive. It isn’t! My personal financial planner whom I got connected with through MyPF is fee-based at a very affordable RM1k for one (1) whole year of professional engagement helping me plan my finances holistically. I also get full access to the MyPF Premier market insights, event invitations, and a supportive community which includes dozens of licensed financial planners. Dreams are achievable! It just requires a simple action to get started and to embark on your journey towards financial independence.

Can My Impossible Dreams Really Be Achieved?