Forget Password?
  1. Indices
  2. Commodities
  3. Currencies
Straits Times 3,211.49 +16.53 +0.52%
Hang Seng 27,352.69 +265.06 +0.98%
Dow Jones 27,219.52 +37.07 +0.14%
Shanghai Composite 3,031.24 +22.42 +0.75%
Why Financial Freedom Matters
By: Dr Chan Yan Chong
Articles (200) Profile

Life is full of ups and downs. If money is what affects your quality of life, the good news is that there is a way to enhance your wealth.

My new book, 《富足自由人》(A Rich and Free Life), talks about the 10S method of stock investment that I came up with. As long as you follow them step by step, you can also be on the road to a rich and free life through investing in shares. But first, let me explain the need for this one-of-a-kind method.

Start Young For Best Results

Since young, I have realised the importance of starting an investment plan early in life, so that one can enjoy old age comfortably. The earlier one starts, the more time will work in favour of the individual. Thus, when you have saved up enough capital for investing, you can go on the offensive anytime. Opportunities come to those who are prepared.

My family was struggling after my father’s death. The circumstances I was in triggered my interest in finding opportunities to make money even while I was in Secondary school. I started selling newspapers and magazines, including story books and comic books to teenagers in schools. Following that, I became a sub-distributor, collecting newspapers and magazines from the main distributors and distributing them to fellow poor student vendors like myself.

When I was a Secondary three student, I tutored primary school kids on Mathematics. My interest towards Mathematics was cultivated since Primary school, and has served me well till today, playing the most crucial role in the success of my stock investments.

I wish to share my experience, and show that I have had my share of low phases in life. However, I did not give up on myself and instead, pressed on to eventually reach my target of attaining financial freedom that I set years ago.

If you have doubts about yourself today, I encourage you to read more inspirational books. You need to dispel the wrong idea that unlike the past, hard work is no longer a guarantee of success today. So long as you stay alert and equip yourself accordingly, you will stand a better chance to become financially independent.

Understand Yourself And The Market

When you understand your personality and your tolerance for crises, risks and investment losses, you will know how to respond to the market. You will be less likely to panic and make irrational investment decisions when the stock market dives. It is not difficult to understand the economic cycle, nor is market trend analysis something beyond comprehension. All these knowledge can be acquired, either through reading or attending classes.

Read beyond exclusive coverages on newspapers or so-called insider tips. Small investors who do not do proper research depend purely on luck for their success. Investing without a sound basis backed by proper research is like gambling at the casino – mostly ending up with losses.

History always repeats itself. Therefore, we need to learn from it. If you understand the concept of historic recurrence, you will realise that a downturn is usually followed by a new peak. Similarly, there are always traceable signs of the stock market bottoming out or peaking, and these patterns repeat over time. I encourage everyone to read the newspapers, not just for the “new” news, but also the “old” ones; review past events in order to understand the present.

Age Should Not Daunt You

By the time you reach a certain age, you can indeed be more relaxed about the things in life. You definitely have the ability to take on new challenges, conquer new peaks in your life. Just think about this: what did you love to do when you were young but could not do then? It may be time to revisit those dreams.

Let me introduce you to a historical figure: Fan Li, also known as Tao Zhu Gong. He was a wily court official to the King of Yue, Goujian, during the Spring and Autumn period. On many occasions, he advised King Goujian on strategies and tactics to defeat his arch enemy, the King of Wu. At this juncture, though, Fan Li left quietly and fled the country.

Legend says he went to the kingdom of Qi, where he went into agriculture and commerce, and made a fortune for himself. It was said that he struck gold three times, and three times he dispersed his wealth among the poor, demonstrating how lightly he viewed money. Eventually, he accumulated a large sum of money and settled in Tao Yi, thereafter he changed his name to Tao Zhu Gong.

The point I want to make is this: by the time you reach a certain age, you can indeed live your life more freely. If you can be like Tao Zhu Gong, having made lots of money, you have proven to yourself that you are capable. Hence, you definitely have the ability to seek out new challenges, and conquer new peaks in your life.

When you have nothing to hold you back, do not worry about your age or whether it is too late to begin anew. When you reach 50 years old, a new chapter in life begins, so the only thing holding you back from pursuing your dream is yourself, and not your age.

Many retirees look for activities to engage in, such as painting, photography or learning music, just to pass time. I feel that this is not enough. My emphasis is on upgrading ourselves, so that these pursuits transcend the mundane act of passing time and forms a new career in our life.

Life After Financial Freedom

Source: Yidaba

When you have attained financial freedom, it is time to think and reflect on what your talents are. Everyone is born with a useful talent, everyone is a genius; but are your talents fully explored, or do you know what they are? Perhaps you do not know, or those talents have yet to be discovered. Now is the time you can explore and try new things.

If full-time work hinders your personal pursuit, then get a part-time job; after all, work can help you sustain your enthusiasm in life. I sincerely hope that through the sharing of my own success story, you can also become a “rich and free” person, living out each day joyfully and a life that is truly unencumbered by the burdens of providing for yourself and your family.

Dr Chan Yan Chong is a renowned investment expert with many accolades under his belt.

Please click here for more information about this author.

Join The Conversation
The Shares Investment editorial team welcomes constructive feedback on our coverage and content. We would also be delighted to answer any questions on the above article. Leave us a comment below, and we'll get back to you shortly!

All Rights Reserved. Pioneers & Leaders (Publishers) Pte Ltd. Best viewed with Mozilla Firefox 3.5 and above.