“Basically, the more you catch, the higher your CPPF.” Wait a minute! Was that a coded message? The more you top up, the higher your interest income from CPF? I anyhow guess one lah.
Life can be unfair. Why am I not born into a super rich family? Why am I not born with super model good looks? Why am I a peasant?
Oh, did I hear someone say it is unfair that this peasant is relatively wealthy?
Is it unfair that I have what I have today? Well, in a way, it is. I am being honest when I say luck plays a part in life.
However, if the sour grapes just focus on when and how I have been lucky, then, they might have to stay sour or even turn bad. Why do I say this?
Life is also fair because, unless we are very unlucky or lucky, we are rewarded or penalised for the decisions we make. Remember the three P words.
Prudence in personal finance means not spending more money than we make. If we are more prudent than most, all else being equal, we will save a big part of our income. Being prudent, we will keep our needs simple and our wants few to avoid wealth destruction.
Pragmatism in personal finance tells us not to complain that the system is against us. Feeling sorry for ourselves is rarely helpful. Instead, we should see how we could make the system work for us so that we are more successful in wealth creation.
Patience in personal finance is something, unfortunately, many do not have. Patience is required for most of us to save a substantial amount of money, patience is required for compound interest to work and patience is also required to build a portfolio of investments that generates meaningful income. Being patient avoids wealth destruction as we delay gratification. Being patient helps in wealth creation.
For any peasant (i.e. an average person) who wants to be wealthier, being prudent, pragmatic and patient can hardly be wrong.