Anyway, it’s obvious that spending is wayyyy easier than saving nowadays. That’s the habit that has been instilled by the big corporations of the world. And that’s the habit which might pull us down if we’re not careful enough.

Some of us spend like there’s no tomorrow. We have ZERO savings and we never plan for the future. For some, they would say “tomorrow might not come, so why worry so much?”. But sad to tell you the truth, tomorrow will most likely come whether you like it or not. And tomorrow might even bring some nasty surprises for you – road accidents, theft, robbery, hefty medical bills, just to name a few.

Faced with all these nasty surprises of today, what would you do? Remember that they will get worse tomorrow, if you don’t solve them now. This is where all those money you’ve saved up come into the picture. There are times when we just need money to pay for urgent things like this. For example, if your son is down with fever (touch wood), and he’s not covered by any medical insurance, and you’re very poor. What can you do? Borrow money from a friend to pay for your son’s medical fee? Isn’t that pathetic? We’re talking about few hundreds, and you can’t even afford that!

Another example, I was accompanying my dad to see a doctor the other day. A couple looked very worried and sad when they came out from the doctor’s room. The girl was sick and the doctor told them to undergo an operation in the nearby specialist hospital. But they did not have the money and they were not covered by insurance. What would you do, if you were in that position?

Some of you might say “such unfortunate thing will never happen to me”, but how sure are you? We can’t predict the future. We can only learn to save for the future, just in case shit happens and we have the means to overcome them. So start planning and saving for your future. Think long-term. Do you really need to get that new car? Do you really need to spend so much on this dress? And, can you survive if one day, you’re being hit by a very serious illness (touch wood)? Can your dependents survive as well?

Think about it.

There are times when I would spend months just to decide whether I should buy a particular item – the more expensive it is, the longer I will take. For example, the new laptop that I bought took me a whole 6 months to think about it – how much do I need to pay every month, do I really need it, what are the things I want to use it for, is there any cheaper option, bla bla bla. Yes, that is the type of person I am (but funnily, I don’t mind spending money on my family).

Sometimes, my parents feel both happy and sad after seeing me like this. Happy because I’m a financially conscious person and know how to manage my money well …sad because I’m reluctant to buy something which I really wanted (I don’t really have many WANTs).

Then one day, my dad told me a story about his friend. This friend of his is a very nice guy but just like me, he is also a pretty thrifty person. He would only spend when there’s really a need to do so. Otherwise, he would normally convince himself that he did not need it. In case you’re wondering, he’s actually quite rich. Few years ago, this guy was admitted to hospital due to cancer. Fortunately, he has recovered but the experience has completely changed his life. Nowadays, he still manage his money wisely but he is willing to buy the things that he wants.

After sharing with me that story, my dad said that it is good to spend wisely and even better if I don’t have too many WANTs (a lot of young people nowadays have too many WANTs that their credit cards could not accommodate). But life is short, and we should pamper ourselves once in a while by buying the things that we want. And there’s no need to justify every single thing. If you want something, can afford it and it won’t jeopardize your financial condition, then just buy it. Just be sure to utilize and cherish that thing after that.

Thinking about the story my dad told me and the advice he gave me, I feel that it is true. Life is short and unpredictable. If we don’t pamper ourselves now, when do we plan to do that?

Save for the future, but also use some money to pamper yourselves. We only live once after all.

p/s….Well, I’m not asking you to become like those people who have unlimited WANTs though….those are pretty unhealthy habits.

Once upon a time, there was this young merchant who has been regarded as a genius by his relatives and friends. At a young age of 20, he already has its own business and led a comfortable life. Although he’s considered pretty rich by many, he has never look down on his relatives and friends. That’s why many of them love n respect him.

One day, he decided to be more adventurous. He decided to move out from this small town and expand his business in the big city 5 hours drive away.

When he was in the big city, his business did well and he instantly became a popular figure among his new friends. But as the saying goes, good things don’t last forever. Few years later, his business failed and he was declared bankrupt. He was forced to sell his properties. But what hurt him most was that all of his so-called good friends have disappeared.

Left without a choice, he went back to his hometown, back to his relatives and old friends. He was surprised when the people there started to offer help to him (provide temporary accommodation, food, money) even though all of them realized he’s penniless. He was deeply touched.

He asked one of his old friends “Why are you still helping me? I got nothing to offer you now that I am penniless.”

His friend replied “Who cares about your money? We’re friends, remember? So don’t be so calculative!”

I’m not sure if this story helps you but this is actually what I’ve realized during my trip back to Johor.

In big cities like Kuala Lumpur, most people look at your properties – houses, cars, money, phones, etc. If you wear a cheapskate t-shirt into the LV shop, you will most probably be ignored. People just don’t care who YOU are. They only care what you HAVE. It’s a very realistic world.

On the other hand, in smaller towns where people know each other well, it’s all about YOU. They will respect and treat you well if you are nice to them. If you’re an asshole, you will still be treated like an asshole even if you’re wearing a Rolex or driving a BMW. What people care is the relationship you’ve built over the years with them.

Heck, even one of the electricians who I know quite well in PJ told me exactly the same thing! Oh, he’s from a small town as well.

Conclusion? Actually the things that you have outside (what you wear, what you drive, etc) are not as important as what you have inside (your personality, your past deeds, your kindness, etc). So if you think you can use money to buy respect…well, maybe it can work in big cities, but it hardly work in small towns (except against few greedy folks).

p/s…. good and true friends are hard to come by. These people are those who will still stand by you even if you’re in a difficult time…..irregardless of where you are. They will not ignore you even if you are penniless. If you have friends like this, always cherish them.

But little do they know that nothing last forever in this world, including the good and nice things that they are enjoying now.

For example, one of my sister’s friend has been working for this small company for 10 years. He’s one of the founders, and his job is basically leading the subordinates. When asked about his future plans, he would reply “I’ve been working here for 10 years now, where else can I go? I guess I’ll just receive my monthly salary in this comfortable place until my retirement”. 6 months after he said that line, he was retrenched.

Another example, a story I’ve read from a book. There was this pretty lady who was looking for a rich husband and few years ago, she finally got her wish fulfilled. Her husband was a business owner and earned 5 figures salary every month. All she has to do was to go shopping (her kids were sent to the childcare centers). But thing took a drastic change one day, her husband got a stroke and was paralyzed. It was a big blow and a life changing incident for her. After all, she has been relying on her husband (and her husband only) all these years. But she has no choice. She has to take over the business without any business knowledge, and tried to survive by doing everything by herself. Fortunately, her husband’s condition improved few years later and she is now faring a lot better than before. It was a big change, but she took up the challenge bravely.

I believe many of you might have heard of stories such as the 2 above especially after the recession hit in 2008 and 2009 – former CEO driving a cab, a 50-year-old house wife of a former millionaire begging for a job which only pays 2k per month, a CEO who thought his products were so great that he refused to improvise and believed clients would still flock over to buy the products for many years to come…only to have his business closed down a year later due to lack of sales, etc.

The thing is, incidents like this do happen quite often in our world. Well, even if you try to live on a hill for 10 years, things around you will still change even if you don’t. The serenity and peacefulness of the forest area surrounding the hill that you once enjoyed could’ve been gone, replaced by…erm….. a motor way… a highway…or maybe a nuclear test site.

Maybe that is why the motivational gurus or career and business experts always tell people not to get too comfortable with the things they have now. I know it’s good to appreciate what you have. In fact, that is what I’ve been telling people to do. However, being appreciative and grateful are not the same as being too comfortable. If you think that every good thing will remain as they are now few years down the road, then perhaps it’s time to change your mindset. And in this case, being stubborn certainly does not help.

And don’t you worry too much. Good things can still be there forever, if you are willing to make the efforts to retain them. Improve yourselves, work harder and smarter, etc. That is what I’m going to do to keep the good things I have now, and I believe everyone should do the same too.

P/S …. Actually, this assumption that “good things will last foever” has been one of the main factors behind the fall of some of mankind’s greatest empires. Many leaders of the past always thought that their empire would remain the strongest in years to come WITHOUT any improvement. History has proved them wrong. Ahem, I think I’ve watched too much Discovery channel.

But is it really that hopeless? Maybe it is, but we shouldn’t let that bring us down and ruin our 2009.

Very meaningful quote from Henry Ford

In my opinion, now is already too late for any ‘fixes’. If anyone tells you they are trying to implement some fixes to improve their business, it’s a lie. I would say that it’s not a fix to improve their business, but a fix to survive. Retrenchments, pay cuts or any cost cutting measures are not meant for ‘improving business’. Quite the contrary. These things are done so that a business can still survive.

That is why I think there are 2 things which every person and every business should do in 2009.

• Survive
• Prepare

The first point is to survive. If we’re not able to survive this cruel 2009 (and probably 2010), then any preparations or improvements will mean nothing. For example, you will need a job and the salary to survive. If you’re jobless now, your priority should not be to improve yourselves or to go for trainings….it should be how you can survive for the next few months. It’s either you get a full time job, or you get a part time job or earn some side income. The objective here is the only and only “to survive”.

The second point comes after you’ve ensured you can survive. It is to prepare yourselves in terms of finance and knowledge. Lead a frugal life and keep as much money as you possible can, and put it as a reserve somewhere. Invest them if you want but never spend it on your WANTs even though there are plenty of promotions and sales this year. You will need that fund to push you to another level once the economy recovers. As for the knowledge, try to improve your skills and exposures by attending trainings, self-studying, doing freelance, networking, etc. The people you know and the skills you’ve acquired now will be very important when the economy recovers. In fact, these might actually be the deciding factor to see whether you are prepared for the next level, or not.

To be honest, most people will spend their time in 2009 and 2010 doing the first thing. These people are actually those who are slightly motivated. Those who are less motivated will just sit there complaining and do nothing. So by doing the first and then the second, you are actually putting yourselves or your business in a very good position to challenge for the top spot when the economy recovers (when companies are hiring again, and when people are willing to spend their money again).

Those are the 2 things that I would advise people to do, and also the things which I myself will do. Because the last thing I want is to miss out on this golden opportunity to make myself known to other people. I don’t think I want to enter the newly recovered economy as a nobody.

Hope it helps.

P/S…….Feel free to check out this useful article from Seth Godin – Slack.

Louis Vuitton (LV) bags

But to me, we will never understand why people spend on those things unless we are in their shoes. Guys will never understand why girls spend so much on cosmetics and fashion stuff (LV bags…omg… =_= so freaking expensive bags). And girls will never understand why guys love gadgets so much.

So the next time you want to comment on other people for spending a lot on something that doesn’t make sense to you…..think again. It might not make sense to you….just like the things you buy don’t seem to make sense to other people.

I think in the end, the most important thing is for you to know what you are spending on and your own priorities especially during recession period. Is the thing you buying really worth it? Can you live and enjoy life WITHOUT it? Will the value depreciate a lot after you’ve bought it? Ask yourselves such questions and hopefully the answers will be able to help you in making the right decision.

P/S… by the way, I don’t know how much it cost to go to Timbuktu. I assume you’ll need at least 40k in order to come back alive.

But before that, we need to be able to predict what is going to happen in 2009. This is important since it will allow us to prepare ourselves better, and also to ensure we are ready to pounce when the opportunities present themselves.

Without wasting too much time, here are some of my predictions for the year 2009 (I do sound like I’m giving a speech eh?).

Will business hire someone to downsize in 2009?

Business in general

• More companies will close down.
• More startups will appear….and disappear.
• 2009 might be the beginning of some well-known corporations. Do remember that some of the famous brands we have now started during recession periods in the past.
• A lot of companies will start cutting cost, and some might mistakenly cut elements which are necessary for the long term prospect of the company. And this might send the companies to a downward spiral.
• There will still be businesses which can profit from this recession period. Do some research and you are sure to get some ideas.

Economy

• The world’s economy will become worse in 2009 since all the previous negative forecasts will become a reality. Also, more companies will report losses or minimal profits.
• Malaysia will most likely enter recession in 2nd or 3rd quarter of the year, even though our economy experts are saying otherwise. Malaysia has the highest number of people with debts/loans in Asia Pacific and even if our banks are very strong, we can’t deny the fact that there are a lot of multinationals in Malaysia. Struggling multinationals might start retrenching people or closing down their operations, thus increasing the number of jobless people. Jobless people will not be able to pay the debts/loans and this can be quite bad.
• I expect the stock market to bottom up in 3rd quarter of 2009 and starts its long journey towards recovery in 4th quarter of 2009 or beginning of 2010.
• USD will continue to rise against Malaysia Ringgit. I expect it to reach 3.7-3.8 range.

Health

• Cures for some diseases or illnesses will be found.
• However, more unknown illnesses will start to appear.
• Old illnesses will also start to become a problem but I doubt there will be any global epidemic in 2009, thanks to our advanced medical science.
• More and more people will start to become health conscious. Healthy food will become more popular this year. So will hospitals, clinics, pharmacies and labs (for blood test).

Job & career

• More people will lose their jobs due to recession and retrenchments.
• Number of candidates per job opportunity (especially in a multinational company) will increase tremendously since everyone wants to work in a stable company in 2009.
• Average salary will become lower because people no longer dare to ask for too much. Benefits might not be so good too.
• The differences will be very obvious between employees with good attitude and employees with not-so-good attitude.
• There will be lesser interesting jobs and more boring jobs. Why? Because interesting jobs tend to be risky at times and most companies prefer to do things with low risks in 2009.
• More people will go for certifications and additional trainings in order to make themselves more attractive to potential employers.
• Hiring and recruitment process will be stricter than before because nobody wants to hire someone useless. Also, terminating someone can be very expensive. Thus, prevention is better than cure.
• Starting salary for fresh graduates might be worse than years before because companies would prefer to hire someone who can hit the ground running on his/her first day.
• Employees should be prepared to step outside their “comfort zone” and be more than what they have been hired for. If they don’t do that, someone else out there will be more willing to do that.

The new IPhone which will change the world? You must be joking

Technology

• Internet connection will become faster.
• Mobile applications will be more popular but not the next “IN” thing.
• Web applications will be even more popular with the introduction of affordable netbooks.
• Microsoft’s future will rely on the upcoming Windows 7.
• Steve Jobs’ creativity will be greatly missed in Apple. I do hope he’ll be fine.
• Desktop applications which allow users to work online and offline, could be the next “IN” thing.
• Open source technologies will become even more popular this year since they’re free and every business wants to cut cost.
• However, be prepared to have a lot of IT projects (especially the big ones) suspended or postponed since IT projects are normally one of the many things struggling businesses would love to cut.

That’s all I can think of. Spent a lot on this. LOL and I just remember I’ve yet to work on my project today!

Do feel free to comment or to add on

Anyway, I came across this very useful and interesting article – You are not your money. I feel that what the author said is very true. Most people nowadays are only chasing after money because..well, we need money to survive irregardless of how much we hate to admit. Without money, we cannot eat, we cannot buy things, we cannot send our kids to school, and all the fine things in the world will just disappear from us. That is why most of us are so caught up in the modern “rat race” that we (some of us) eventually, forget who we are  and what we actually stand for. And we often begin to relate our money with ourselves. We become happy when we can earn more money…and we become unhappy when we lose money.

Source: http://morningpaper.typepad.com

But is this really the right way to lead our life? To chase after money every time? To let our happiness be controlled by our own money? To treat our money as if they are ourselves?

Think about this – having more money in 2009 than 2008 is a good achievement, but does that change us as a person? I don’t think so. Similarly, having lesser money in 2009 than years before does not mean you are becoming a worse person. You are just a poorer person in terms of money. On the other hand, does earning more money through illegal deals make you a better person? NOPE. Remember that the real you does not change with your financial condition.

What will change you then, is your behavior and your impact to the world especially to the people around you, and to the community. It is the things you do for others which reflects the real you.

Also, remember that at the end of the day, you can’t bring your money along when you leave this world. The only thing that is worth bringing along, is the knowledge that you have touched the life of others deeply during your stay here. And that you have contributed to the society in a positive way.

So if your financial condition is being hit pretty badly in the year 2008 or 2009, remember that you are still you. And with enough efforts and plannings, you will regain what you have lost. At least, that is what I believe in.

Hope it helps.

p/s… sorry if this post sounds a bit confusing. I’m really quite tired by now. Haha.

Yes, and no.

It’s a good thing to reduce the total workforce since that will surely help reduce the total cost significantly. But do bear in mind that reducing the workforce will also reduce the productivity rate of your business. However, you can minimize the drop in productiviy if you only remove the workforce which is not productive. The problem thing, most businesses don’t really care about that. They care about the numbers. They care about the total cost they are required to pay now. And they are desperate.

Thus, they reduce the workforce without taking the time to select the proper people to be “removed”. Even if they do that, there will surely be some mistakes and some important and productive people will be reduced. And reducing your skilled and good workforce will be bad for your business. It might cause your business to suffer a heavier cost than you originally wanted. Always remove the bad performers and keep the good ones.

That is why in my opinion, I feel that reducing the workforce should always be the last resort. There are many other things which you can try to reduce. For example, reducing the total salary package of the top management people. By reducing 20% of their pay, you can surely keep some of the better employees at the bottom of the food chain. But most of these “bosses” will not be willing to sacrifice their own skin for the business.

Maybe the business can get rid of the more expensive clients? Clients who are giving more troubles (thus higher cost) than anything else. Get rid of them, and focus on other clients who are less expensive and more profitable.

If it’s cheaper to do something by outsourcing, then do it. Having a dedicated team to do a non-core jobs (non-core, in other words, means not profitable) can be quite costly. Or if you think it is more cost efficient to have your own people do it, then by all means, let your own people do such non-core jobs. It really depends on what your business wants to focus on.

Reduce the salary of employees is also a good option. As long as you do it company wide and don’t overdo it, then it should be fine. A 5-10% drop for 1 year is always better than retrenching people. Just make sure you give a timeline to your people because that will be an important promise. If you don’t revert their salary back after that 1 year, then be prepared to lose a lot of good people and also have your reputation ruined. Also, don’t ask for a big cut all of a sudden. 5-10% is still okay but 20-30% is not okay at all. And if you are planning to do this, do ensure you still keep your employee benefits because that will help retain the good people.

Besides that, controlling your company’s other expenditure is also important. Bosses using Business Class to fly? Change to Economy then, or maybe Air Asia. Also, stop all the external trainings unless they are necessary. Start giving trainings internally. I think by doing those, you can actually save quite a lot.

At the end of the day, what kind of cost to cut depends on your business’ priority and direction. But one word of advice, if you want your business to sustain and survive this recession, always try your best to keep your good and productive people. Without them, your business will find it very difficult to recover even if your business manages to survive through the global recession.

Hope it helps.

It seems like most Malaysians are worried about our country’s economy but are not able to control themselves from spending more. However, compared to previous sales, most Malaysians ARE spending lesser, which is a good sign.

At the end of the day, it is important to spend on your NEEDs but it is even more important to know your limit. Always have the right plans which will ensure you are ready for year 2009, which is said to be worse than 2008.

But that does not mean all of us should dig our head into the mud and be prepared for doom. Be optimistic and always hope for a better year ahead. Without hope, we’re nothing.

Have a very happy year 2009 folks.