Wah, investments got 10% returns - shiok ah!
Do you want 10% returns on your investments? More? You bet! 10% who don’t want, right? Considering that the banks are giving a miserable 0.0000000000035%.
Well let’s see, what kinds of investments actually can produce 10 eggs for every 100 eggs you buy? Stocks, Property, Commodities etc, but hmm, if you did, then last month(Oct 2008) you probably broke 40 of those 100 eggs you bought earlier. And now when it’s cheap, we’re out of cash to buy more… :(
I also invested $2000 dollars last year. my 10% ROI will give me… wah, $200 dollars!!! Only enough to pump 1 month’s gas into my car…
So what’s the deal here? The truth is, investing to get higher returns actually gets more practical and easier when one has reached a certain level.
Just as an example: look at the difference in rates that banks are giving for different amounts of deposit.
Bank M 12mths Time Deposit Rates
- 1.68%p.a. $25,000 to $249,999
- 1.88%p.a. $250,000 to $1,000,000On surface the above seems normal but did you know that the auntie who placed a $250,000 time deposit is getting 11.9% more! compared to you, if you had only placed a $25,000 time deposit.
Calculation : (1.88-1.68)/1.68 x 100 = 11.9%
So what I would say is instead of punting the market/spending loads of time trying to find that miracle stock or investment. It is prudent in the early days to concentrate on one’s job (especially in these trying times) lest you get retrenched.
A pay raise is a permanent investment gain on your time spent. One month extra bonus is way more than 10% returns you will get on a $10,000 investment in stocks today.
Another solid example: if your net worth is $50,000, a month’s pay of $5k with 50% savings ($2.5k) is already a 5% increase in your net assets, IN ONE MONTH!
And the time will come when all that cash you stashed away in your opportunity account will be useful for that investment that might just change your life.
We all can play the rich man’s game but we have to reach their level first.
Refer to my previous posts on Get richer climbing the pyramid and Here’s how that Ah Beng became richer than you.
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