When I was a secondary school boy, I became an avid footballer. 

Nothing beats the feeling of running freely around the padang to kick a ball and at that time, football was larger than life and it brought so much happiness that is worth more than just having money itself. Today, as I write, I had realised that in many ways, football had shaped how I invest and plan for my finances today. 

Here, I like to pen down some key investment lessons I have learnt from playing football. Along the way, I will address questions such as the following: 

– Are stocks better investments than properties? 
– Why put money into Fixed Deposit if I can invest in properties? 
– Why buy insurance policies when I can use the money to invest in stocks? 

In the end, I hope you will gain an insight or a structure as to how you can build wealth systematically over the long-term. Thus, the key lessons are as follow: 

#1: The Formation Is More Important than the Player. 

Imagine yourself as a football manager like Alex Ferguson or Pep Guardiola. 

The Starting 11 refers to the 11 football players you want to appoint to start the football match. They consist of a goalkeeper, defenders, midfielders, and finally, the strikers. So, the question is, ‘If you are a football manager, would you put all strikers (like 11 Ronaldos) as your starting 11 in the next football match?’ 

Obviously not. This is because savvy football managers understand that football matches are often won by teams with better structures in place, not solely on a couple of star players themselves. This is the same with finances. It is about the structure that will build wealth and not the few star investments themselves. 

So, instead of asking ‘what should I be investing today?’, I would say it would be helpful to ask, ‘How strong is your overall financial structure presently?’. Hence, with that, let’s look at the next point, which is: 

#2: Appreciate the Roles Each Player Has to Play. 

Understandably, Ronaldo is one of the renowned footballers of the world today and is popular among both footballers and non-footballers alike as a global icon presently. Now, here is a question: ‘Do you know who Luke Shaw is?’ 

If you are not into football, you will probably think to yourself, ‘Who Luke is and what is the significance to this question?’. 

First, Luke Shaw is a defender playing for Manchester United, the team Ronaldo is playing for today. Yes, Luke could be less well-known as compared to Ronaldo presently but the question is, ‘Can Manchester United remain as one of the top teams in the Premier League without Luke Shaw?’ 

The answer is nope. This is because a top team is made out of different football players who can understand and play out their roles assigned to their very best. All of them need to appreciate their teammates’ roles so that they could form a united football team that could win leagues and tournaments. 

Similar to finances, we need to understand that there are vehicles (players) that are meant to add income and attain sustainable capital growth for the long run. Also, there are vehicles that could offer financial safety nets to us and our loved ones if we lose our abilities to generate income. 

If a person asks, ‘Why buy life insurance when I can invest in growth stocks?’, to me, it is clear that he is one that appreciates Ronaldo more than Luke Shaw. Or, he just does not know why Luke Shaw is needed in his Starting 11. He may even think that paying Luke Shaw millions in salary is simply a waste of money. 

#3: Success Is In the Supply Chain

Let me illustrate. First, here are the basic roles for each footballers’ position: 

#1: Goalkeeper
He keeps the ball from entering his net and denies his opponent from scoring. 

#2: Defenders
They intercept the ball from the opponents and pass the ball to the midfielders. 

#3: Midfielders
They receive the ball from defenders and pass the ball to the strikers. 

#4: Strikers 
They receive the ball from midfielders and attempt to score goals. 

Thus, Ronaldo would not be able to score goals if his midfielders are not able to supply him with balls to strike. Likewise, his midfielders could not have the balls if his defenders failed to intercept the balls from the opposite team. Thus, it is a very important thing to realise that all of this is a supply chain and if it is strong, the team will create many goal scoring chances to win the football match. 

It is the same for our finances. 

The supply chain of our financial structure must work in unison so that we build wealth systematically over the long-term. 

By now, you would ask, ‘So, who are our goalkeeper, defenders, midfielders and strikers in the context of wealth building?’ 

Well, they are as follow:

The above illustrates the formation of my Starting 11 in my financial plan. Here, I have segregated each financial tool (except God) based on their attributes and roles in wealth building. 

#1: Defenders 
My back three defenders, consisting of life insurance, will, and trust would offer a financial safety net in the event of a premature death, disability or a diagnosis of a critical illness. 

Meanwhile, a medical card and cash buffer of 12 months worth of expenses are placed above my three defenders. A medical card is useful if I’m hospitalised. In respect of the cash buffer, it is useful if my active income (midfielders) has been reduced temporarily due to a slowdown in business activities. 

#2: Midfielders 
The first two midfielders are two different types of active income. Both of them are midfielders as they will supply balls to strikers to score goals and also would supply balls to defenders to safeguard my own net. 

The first type of active income is active trading income, which is income earned from a person trading his time for money. Meanwhile, the other type of income is active scalable income, which is income based on production that is scalable. 

As an illustration, let’s say we have Mr. Tan. 

Mr. Tan is a sales manager who makes a basic fixed salary of RM 8,000 a month. In his course of work, he leads a team of 10 salespeople and he will earn a total of 10% in commission from net sales proceeds attained by his team a month. In the past month, Mr. Tan’s team had achieved RM 100,000 in net sales proceeds and thus, Mr. Tan’s commission works out to be RM 10,000 for that month. So, 

Mr. Tan’s basic fixed salary of RM 8,000 a month is active trading income. 
Mr. Tan’s commission of RM 10,000 in that month is active scalable income. 

Both of these income are leverageable for Mr. Tan is required to pay income tax on them. Hence, banks could lend money to Mr. Tan based on his active income and Mr. Tan could use these borrowings (mortgages) to invest in real estate. 

Hence, the mortgages are forms of leverage to Mr. Tan to build wealth. 

#3: Strikers 
Finally, we have the strikers that are intended to add passive income and to add capital growth in order to build our wealth. 


Hence, if I ask myself what I should invest next, I will look at the Starting 11 as a simple guide to decide what I should be doing next with my own money. 

So, if my defense needs to be strengthened, I will invest my money to solidify it. If my active income is impacted, I would work on the midfielders. Finally, if I see an opportunity to score a goal, then, there will be where I would be positioning my own excess cash to capitalise on it. 

Alright! That is it for this week. Here is homework for you. 

You may refer to my Starting 11 and start plotting your Starting 11 and see how it looks currently. You might even get an insight on your current financial status, allowing you to decide what you really need to do next to solidify your financial future. 

If you have any questions / feedback, please post them to ian@kclau.com.

Ian Tai
Ian Tai

Financial Content Machine. Dividend Investor. Produced 500+ Financial Articles featured in KCLau.com in Malaysia and the Fifth Person, Value Invest Asia, and Small Cap Asia in Singapore. Regular Host and Presenter of a Weekly Financial Webinar with KCLau.com. Co-Founded DividendVault.com, an online membership site that empowers retail investors to build a stock portfolio that pays rising dividends year after year in Malaysia and Singapore.

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