This title sounds contradictory to financial intelligence.
As what we all understand, you need to save money to get richer. That involves spending less than you earn and save whenever possible.
Let me tell you a story. In fact, I didn’t make up this phrase on my own. I heard it from a close friend. And he is not ordinary people. He is the best in what he does in Penang. When someone with his status, wealth and ability said this, there must be some wisdom in it.
He plans his oversea trip one year ahead. When you open his calendar, you’ll find that he knows which part of the globe he will be going to (mostly for vacation) in the next 12 months. He is travelling for fun almost every month. For some of the trips, he asked me to join him.
Sometimes I will join him, sometimes not. Some of the trips are luxurious and expensive, such as cruise vacations in the Europe. If I am going with him, I will be bringing my wife along. It costs RM12,000 per person for the cruise vacation. I will need to fork out RM24k if I join him.
“No”, I said I can’t join him because RM24k is a lot of money. I think spending RM24k in 10 days is a luxury.
As you might have guessed, this was his reply:
“Money not spent, is not yours.”
We spend money in exchange for a certain value. The “value” we desire may be something materialistic, or a service that improve our life in certain ways.
What he means is that you will only get the values when you spend the money to do the exchange.
The truth is that the amount of wealth you have does reflect your life value. The more money you have, the more you can spend to increase your value further.
What do you think?
{ 19 comments… read them below or add one }
“Money spent, is no longer yours” ~ Kegan Gan
Money is a mechanism to store time and energy. You spent time and energy, and they are converted to money. If you spent two months working. Working from nine to five everyday. And you earn RM24K.
Will you exchange that for a 10 days memory on a cruise?
Unless I can find ways to make RM24K using less time and energy. Or unless I can find more compelling reasons for the trip, etc. I am most likely not going to exchange RM24K for 10 days on cruise.
The “value” of money is determined the moment we spend it.
For 24k, you can probably:
- Make an investment
- Enjoy a good memorable family cruise vacation
- Enjoy a good memorable family vacation in a wonderful place
- Fund the education for your children (you’ll need more than that amount…)
- Sponsor for part of the tuition fee of a talent who is from poor family
- Donate to charity, especially to the children in poverty world
- Donate for activity of humanity, religion, politics, etc.
- Donate to Chinese school
- Donate to museum, gallery, etc.
- Pay the down payment of a new property
- Pay the down payment of a new car
- Buy luxurious diamond or branded handbag for your wife
- …..
Which one do you prefer?
It depends on your objective. Some people’s objective is to enjoy life. For others it’s to hoard wealth. I prefer the former.
btw RM12k on a 10-day cruise is not outlandishly expensive in the world of luxury cruises.
i agreed , if i said if..you made a very good income more then enough for everything and save enough ( depends on yr objective), is true we need to enjoy along the way..as we built our financial ground, as money not spend by you is not necessary your money, cause life is so unpredictable..it may be someone else using your money at the end of the day, whom dont have to work for a day of sweat..
I agree with Farulg, it all depend on one’s value or their objectives in life. Some people like to travel, some people like to buy jewelleries and some like collecting properties or collect wealth. To me, first is protection against risk, next is to save and invest and at the same time, I need to enjoy life. Because like Esther said, at the end of the day, we may not be the one ejoying our hard earned money but someone else! I have gone through many medical problems in my family and you never know, when we are down with a serious illness. So what, you have money but you cannot enjoy it!
I also agree with Farulg. It depends on your objective. I also put allocation for vacation/ to enjoy life with family at least once in a year. However I will not put as much as RM24K for a 10 days memory on a cruise but probably I will use it for other kind of vacation such as going for umrah etc. For muslim, I can have 2 in 1 package for the same amount ie; vacation + umrah (religious requirement).
I would go for it!!. We work hard, save money, make investments, make more money, invest further….what for? We need to look back….the money is for us to spend.
So I will take a 24k for an exchange with a Cruise vacation in Europe.
At the same time, we keep our bank balances intact, so that we don’t eat up all cruising around. Plan your finances and vacations. It must fit well together -unless otherwise I totally agree that “Money is not (able to) spend is not yours”.
Start doing what you love with the money you accumulating…for me vacations !!
I agree, money alone has no value at all, just a piece of printed paper. If don’t exchange with something we feel worthy, why earn money? that’s my philosophy
What we try to have in life is a balance of yin and yang.
The balance of yin and yang is a very encompassing concept and can be applied to the management of our money.
This balance if kept will keep us out of trouble.and probably be a happier person.
If you just act on the maxim “Money not spent is not yours” by spending every cent purportedly to claim ownership of your money is foolish to say the least.
On the other hand if you save every cent because you completely do not subscribe to that maxim will make you a slave to money.
So the best is to strike a balance between spending and saving without compromising our own priorities.
Well, if money comes easily to you, why not also enjoy life. No use in hoarding it. Never know when you will die!!, It all depends on each individual attitude and financial thinking. That’s my two cents worth.
It depends on how you value those goods or services in exchange. For example, for some, a RM100k car is nothing different with those RM50k as they are all having 4 wheels and bringing you to point A to point B. However, some might think that the security features like ABS, VSC, etc, are important and they willing to pay for it.
In short, there is no right or wrong on the spending but how you value your spending.
for 24k, I will used half of it to pay for my PTPTN…., and half of it for investment… ;P
I assume your friend has reached a level where he does not have to think of money because while on holiday, money still comes in. He has probably worked out a smart system. For someone like him, the phrase probably works. But for majority of people, to spend RM24K on a 10 day holiday is simply ridiculuos and the phrase would be silly to them. No wrong, no right but it really depends on your income. I know someone who has retired, earns almost RM300K a month from his rentals. It depends on the individual really.
I like that phrase! I think it is partially true as having money but not spending it does not make you much better off than the person who has no money but is living as you are now. Money is merely a vehicle for you to trade to gain more value in life. So what we should learn is to learn how to spend money from time to time to just enjoy ourselves instead of being so calculating everyday and just saving money but not actually using it as the money we have saved is not “actually” ours as we wouldn’t have yet benefited from it yet.
Actually it is very true that the amount one spends depend on his/her own capacity, like gerard said, if a person is earning 300k per month, it is very humble to only spend 24k for vacation every month, or even twice that spending per month. It is also depend on what a person really wants or enjoy doing. Having money is having security, falling sick or die doesn’t mean you haven’t made the best use of money, but the money could probably help your loved ones to continue their life. If you fall sick, the more reason you need to have more money in that particular time, who knows you already exhausted the insurance money? If you don’t have enough money to sustain ur down time, most likely you become a burden to others. Similarly during financial crisis, what happen to those company with low cash and high debt compare to those company with high cash flow and low debt? high cash survive. If you study on spending pattern of many wealthy ppl, they don’t derive happiness from trading money for pleasure, in contrast they have very different opinion in what pleasure means, they enjoy making money and that’s what they enjoy doing because it will provide them more security in the end. Having a guaranteed lifestyle till the end of life is what they want.
Yeah, it depends on how the individual chose to spend for enjoyment. He/She surely earns a lot, hence able to go for that RM 24k vacation without any worry. For me, I would go for a RM 2.4k vacation in similar 10 days even though I’m a millionaire one day. Nice vacation memory is valued by the happiness during the trip, not necessary by the amount spent
anyone have any idea how to raise a capital of RM2,000 into RM10,000 in one years’ time??
It is definitely not ridiculous to spend RM24,000 in 10 days on a cruise vacation if this person has already achieved ‘this’ level of wealth.
Comparatively , just imagine someone who is earning RM2,400 per month spends RM24 for a one-pax dinner at a high class restaurant, it is still reasonably okay as he uses his hard-earned money to exchange for a reasonably scrumptious meal at a reasonably cozy dining environment after working for so hard in one month. But for someone who is earning RM480 per month (may be the operator in the factory) will find it ridiculous to spend RM24 just for 1 dinner.
We can easily make a conclusion to the story shared above by just scaling the amount spent into a smaller figure that we can closely relate to. Then, the spending attitude of KC’s friend can still be rated as normal and reasonable, because he is at a different financial status compared to most of us.
I would think that spending desires compels earning desire. The more luxurious needs you created for yourself, the more fire in you to earn more. I wasn’t aware of any investment needs until i try to do my home renovations, which almost, emptied my bank account. From then on, every single day, every single minute i will dig into the web to search for ideas in earning more with the shortest time. Realty, unit trust, trading, eBay reselling, freelancing….all of those i would definately not be interested if i did not emptied my bank account back then. Not a successful person as of yet, i can say that i am starting to get easy money as compared to before.