MOST of us spend our whole lives facing money woes. There's nothing peculiar about that, but is there a better way to live? Financial failure and economic doom are metaphoric pits we can easily plunge into; escaping them, though, is difficult.
Achieving financial success requires a plan, or a map, or a blueprint to guide us away from oblivion and toward victory, ideally, one logical step at a time. With that goal in mind, many years ago I crafted a financial roadmap to help regular people take a sequential journey to what I call "Financial Freedom".
The term is dear to my heart and central to my career development because 22 years ago three professionals — Edmond Cheah, Wong Boon Choy and Alex Sito — and I co-wrote Malaysia's first comprehensive financial planning book, Financial Freedom — Your Guide to Lifetime Financial Planning.
It was published in December 1998 by KL MUTUAL, now known as Public Mutual, Malaysia's largest private unit trust company. At the time, Cheah was KL MUTUAL's chief executive officer, Wong its senior general manager, and Sito headed its Marketing and Financial Planning Department.
I was an external freelance writer eking out a living by my pen and keyboard when I made a competitive pitch to help write the book. I count myself fortunate to have been selected by Cheah and Wong to co-write Financial Freedom with them and Sito.
We had a blast! The four of us worked well together and became friends. Our book raised money for various Malaysian charities while I earned enough from this specific writing project to pay for my wedding dinner in Port Dickson on Oct 10, 1998.
I learnt a great deal from my co-authors, all of whom are much smarter than I. My own financial planning practice today would not exist if the three of them had not granted me the privilege of being a part of our initial Financial Freedom book project.
Through it, we helped tens of thousands of Malaysians at the end of the last century gain a valuable handle on personal financial planning. My nostalgia is justified because all that occurred more than two decades ago.
Time flies when you're having fun.
PLAN AND STRATEGISE
Regular readers of this column will know that:
1. I'm now 56 years old; and
2. I love my work, and thus hope to be blessed with sufficiently good health, vigour and cerebral clarity to continue running and growing my practice past my 75th birthday.
Ultimately God's in control of our days, but each of us would be wise to dream big, work smart and ceaselessly hope for the best, particularly during this deep, depressing, but ultimately ephemeral, pandemic.
I hope you love your work, too. If you don't, you owe it to yourself to change tracks for a better life. But even if you do cherish your work today, it would be wise to plan and strategise to reach the point where you no longer have to work for money.
I recently chatted with a young clinical cardiologist who asked intelligent, targeted questions about my practice principles and retirement portfolio construction methodology.
Midway through our Zoom meeting, he hit the proverbial nail on the superannuation head when he said one of his big life goals is to reach the point of not having to work for money.
He yearns for a level of financial independence that will permit him to follow his passion, whatever it may be. Even if he continues to treat human hearts then, he doesn't want to feel like he must chase the almighty dollar — or our weakened ringgit — to provide for his family.
Our discussion then moved into the realm of planning for and working toward financial freedom. I used Zoom's helpful "Share Screen" feature to outline for him my proprietary plan, which ages ago I shamelessly christened "The Rajen Devadason Blueprint for Financial Freedom".
IMPORTANT BLUEPRINT
I teach it in all my live financial planning and retirement planning workshops, seminars and conferences, and in my online webinars (for a listing visit me at https://learn.rajendevadason.com/).
Furthermore, as I guide my financial planning clients from where they are to where they hope to arrive at in the years ahead, I often use the blueprint to provide useful touchstones from one review meeting to the next.
Since I know the blueprint can help every motivated person, in the weeks ahead I will explain its specifics even as we expand our exploration of the fascinating subject of retirement funding and preparation. I'm sure you can't wait!
For now, though, please note that my blueprint aims mainly to help driven, ambitious people attain financial freedom by taking personal responsibility for:
1. Increasing their Active Income by working harder and smarter;
2. Curbing their Operational Expenses, which determine their lifestyle, by committing to self-sacrifice and delayed gratification;
3. Eradicating their portfolio of debt as quickly and sensibly as possible;
4. Building an Emergency Buffer Fund (EBF) to handle life's unexpected challenges; and
5. Constructing a portfolio of wealth geared toward generating four different forms of passive income: interest, dividends, distributions and rent.
So, till next Sunday, dear reader, I suggest you think on paper and begin charting out your personal and personalised trek toward Financial Freedom as part of your long-term retirement funding aspirations.
© 2020 Rajen Devadason
Rajen Devadason, CFP, is a Licensed Financial Planner, professional speaker and author. Read his free articles at www.FreeCoolArticles.com; he may be connected with on LinkedIn at www.linkedin.com/in/rajendevadason, or via rajen@RajenDevadason.com You may follow him on Twitter @RajenDevadason.