Are We Spending Our Money Wisely?

@ahgong (10064)
Singapore
June 20, 2008 2:15am CST
I was surfing around when I came across this posting by another member in that forum. In my haste to copy extract out the relevant portion, I forgot to bookmark the link of the page before moving on to the next web page. So here is the extract... [b] A lot of us out there had probably collected our bonuses or had a pay increment, or even both, in the last 12 months or so. While I'm happy that the economy is doing very well and the majority of us having the feel-good factor, I just hope everyone can take a step back and ask yourself whether you have been spending your money prudently. Now you may be wondering why am I asking this question. Here's what triggered my train of thoughts. Recently, during a chit chat session over lunch, one of my male colleagues told me and other colleagues that he was planning to marry his girlfriend. Then the question about what is he planning to do to propose to his girlfriend came along and all of us gasp when he said he was buying a ring worth 10k. Wow. Then not long later, another gossip went round office that another guy was planning to buy a ring worth 12k. Double wow, everybody went. By this time, I felt pretty disturbed. There are a lot of people around me who are over-stretching their finances. I have other friends coming up to me and tell me that they are broke because they bought a condo or a car. Many of them are degree-holders and professionals in their respective fields who are earning nice salaries. Yet so many of them are maxing out their credit lines like nobody's business. Now u may say, that is not happening or going to happen to u. But have you really looked hard at your own expenditure? I have read so many postings by forummers that they have made their purchases on zero-installment plans, buying things on credit, taking the maximum renovation loan of 30k, etc. Circumstances can change drastically and sometimes without warning. It can happen at the macro and/or personal level. An epidemic outbreak or terrorist attack may occur and the economy slips immediately into recession. A person may suddenly be struck down by strange illnesses and incur huge medical bills. How many of us are really saving enough for contingencies? Far too many of us are spending money just to get that instant gratification: because I worked very hard, I must reward myself with the best. Recently I made some postings commenting that I felt it was crazy for someone to splurge so much money on a ring for the woman he loves. Now, I'm not against guys out there who want to make their woman the luckiest woman on earth on proposal day. I just wanted remind fellow forummers to be prudent in their spending. Q: What is the objective of buying an expensive ring for the woman that a guy loves? A: To make her feel the luckiest woman on earth and to see her 'surprise' expression upon seeing the ring. Q: Can we achieve the same effect without spending that much money? A: Yes of course. All it needs is a little creativity and plenty of heart. Q: Since the same effect can be achieved by spending less, then why are we still spending so much to achieve the same thing? A: Beats me. Perhaps its for egoistic or vanity reasons? To let others know that one can afford it while others cannot? Or is it because we have been brainwashed by advertisements and messages bombarding us, telling us that diamonds are a woman's best friend. Hence, we must buy the most expensive ring we can lay our hands on to prove our love for her. The above applies not just to rings but on other luxuries that we splurge on as well. Sorry people. I know I sound cynical. But at the end of the day, I just want to remind fellow forummers including myself to spend our money wisely and prudently. Before you open your wallets the next time, remind yourself to exercise prudent consumerism. [/b] So it got me thinking, we are all guilty of some luxurious pleasures when we get our bonuses at the end of the year. Did we ever think about the future when we are indulging in that luxury? Has it ever cross your mind to save some of that bonuses aside as savings or investment? I wonder...
1 response
@applefreak (3131)
• Singapore
20 Jun 08
well first let's talk about the ring. if all else being equal a bigger diamond will make me happy. $12k is not a lot to spend if the person feels it's worth it. this is all relative as some find that spending anything more than $500 for a tv is insane. i don't have a $12k ring as i still couldn't afford one. but that doesn't mean i won't pay that amount for a ring. i do make purchases on 0% interest installments. however, one rule i have for myself is i MUST have the money in my bank account. once i charge the amount to my card, i'd keep the money elsewhere to earn interest / dividend. i pay my credit card bill on time and in full. so i consider myself financial secure. :D
@ahgong (10064)
• Singapore
1 Jul 08
That is a very good thing to do. Not everyone thinks the same way. That is why more and more young people are getting into debts that they are struggling to get out of. Just a few weeks ago, the sunday times was reporting more people going into debt due to over spending on cards. It is so dangerous when people are going out and not bring money. We never really realise how much we spend till the bill comes at the end of the month!
• Singapore
1 Jul 08
guess i'm a really cautious person. it's just that i've seen enough to make me to be aware of the pitfalls. credit cards are so easy to get nowadays. it doesn't help that the banks are fighting real hard for card holders. maybe MAS should really consider rising the min annual income for credit card application. at least then those who can apply for a card has more to pay. ;p
@ahgong (10064)
• Singapore
3 Jul 08
Yeah... I know what you mean. With so many attractive gifts and incentives when you use those cards, many young people are getting trapped in the credit crunch earlier and earlier in their career. It is with utmost discipline that one is able to stay away from it all. With more credit limit extended, and no cash in the pocket when one goes out shopping, it is easy to overspend without even realizing it. That is till the end of the month when the bill comes that they start tearing at their hair. Sigh...