Today, we have a reader, Farouq who would like to share his story which he called ‘financial blindness’. He hopes he could do the impossible possible, turn back the clock and learn about financial management at early age and would have achieved financial freedom by now. But better late than never, although a lot tougher now given economic challenges today. Perhaps the youth out there can learn a thing or two from his story.

His Story

Prior to my graduation in 1997, I decided to join advertising as an artist. Technically, I was hired based on talent, not my academic qualification since I have not officially graduated. I didn’t even have exam result to show to my employer.

18 years on, 5 ad agencies later, I’m now a senior creative leader in an international ad agency based in PJ, earning 5 figures monthly salary. I’m a single breadwinner for my family. Successful career one might think, except, the reality is, financially, I still can’t afford to buy landed property and is still paying for my small apartment which I bought when my monthly salary was just below 3k. But looking back, that small investment in the small apartment turned up to be my big savior today.

The decision to start working before graduation was simply because I have plan to marry my sweetheart in 3 years time. Note that by end of 1997, Asian Economic Crisis happened and I was forced to take 10% pay cut by my employer. But I was more than grateful to keep my job and continue to earn a living as I need to save as much as I could for my wedding.

The Wedding

My basic starting salary then was only 1.5k but I managed to save almost 1k every month. I worked overtime, over the weekend, over everything else. What helped was I stayed with my parents and only have RM120 monthly commitment for my bike. I had no other investment except some 2k plus in my ASB account. Long story short, I managed to save enough and married my sweetheart in just 2 years of savings.

And it’s the beginning of my roller coaster ride.

The first ‘financial blindness’ effect came right after the glorious wedding ceremony on both sides of the families, we were so broke we couldn’t even afford a honeymoon. In fact, we only went for honeymoon in Port Dickson 8 years later, with our 2 kids on board!

Struggling to keep up with the rising cost of living in KL, we had to rely heavily on credit cards and personal loans to pay our bills and car loan. At times, we were so broke I had to withdraw cash advance from my credit cards, and use it to pay the minimum credit cards outstanding balance. But one thing I learned through books and internet articles reading, no matter what, don’t ever default on loan repayment. Keep repayment record clean. Credit is our lifeline.

The Small Apartment

Despite this, I still went on to buy a small apartment. I bought it because I need a bigger space for my expanding family and that apartment is the only one that I could afford within my preferred location. I used my EPF savings to pay for the down payment, and borrowed some money from my parents to pay legal fees. No trick, no knowledge, just blindly buy.

Years later, when I have accumulated 3 kids and amassed more than 50k credit cards and personal loan debt, I realized that I have to get out of this financial blindness. I’ve read about consolidation strategy on an international bank’s website. With my now bigger monthly salary, and a good credit track record, I apply for a big personal loan with lesser interest compared to credit card. I paid off all my credit card debts with this borrowed money. I have a better cash flow now but still have to pay personal loan installment. Oh, ya, the personal loan comes with free credit card. And before I know it, I’ve max out the credit limit. I’m back to square one!

Remember that small apartment I bought earlier? Yes, what would I do without it. Since its value has appreciated more than 200% I refinanced it to pay off all my ‘new’ debt and that proof to be the best financial tools I’ve ever experienced. I’m now only need to pay installment for my apartment and a second car.

I’m still a long way from financial freedom, but getting a better control of my finance is my immediate goal. Reading financial tips written by Mr KC Lau, has really helped me in managing my credit card and keeping financial blindness away from me.

It is not a happy ending just yet, nevertheless the road to success is just getting clearer.

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