What kind of relationship do you have with money?

Hi guys, I touched upon a point about earning money in my previous post and I thought it was an interesting enough topic to get an entire post dedicated to it. You see, most people have only two ways of measuring how rich you are: they either look at the total value of the assets you own including all the money you have in the bank and other assets such as your house and your car, or they tend to look at how much you earn. Today's post will be somewhat different as I am going to discuss our relationship with money from quite a few different angles - from how we earn it to how we spend it.

What is your relationship with money?

Efficiency: what is your hourly rate? 

Ah, most people will do a double take when I mention the word hourly rate because that's often used for people who do casual work - for example, a dishwasher in a restaurant will probably be paid an hourly rate, so if his rate is £8 an hour, then he knows he will be paid £40 if he works a 5 hour long evening shift. Hourly rates like that usually apply to people who do temp work or earn very little money and so they are merely paid for their time rather than their output. It would be silly to try to work out how much to pay the dishwasher by measuring his output, by counting how many cups, plates, dishes, glasses, mugs, pots, pans, chopsticks, spoons, knives and forks he washes during his shift - so the sensible thing is just to work out an hourly rate for his work. However, professionals like engineers, doctors and accountants are not paid by the hour - they usually have a contract which works out how much they are paid a year and within that contract, they are also offered other benefits like several days of paid vacation. Someone like my sister who is highly skilled and very experienced has such a contract as she is a very senior position in a Singaporean company and they have a contract for her like that (which also includes a rather generous bonus at the end of the year). So with this very generous contract, the deal is that she has to work very long hours and nobody is counting the 'overtime' she has to put in if she has to work till 3:30 am to meet a deadline. She can tell me how much she earns a month or a year, but when I asked her what her hourly rate was, she did a double take and said, "oh, I think I need to work that out with a calculator."

Now here's a simple fact: my sister earns more than me in terms of her annual package (I used the figures for my last financial year to compare). But nonetheless, we worked out how much she earns an hour vs how much I earn an hour and it turns out I am on a much higher hourly rate than her. That's because of the very different nature of our jobs - she is in a very senior position in a Singaporean company thus her job does make huge demands on her time, she is often putting in between 80 - 90 hours a week whilst I tend to work between 20 - 30 works a week. That is significant as she already works between 3 to 4 times longer than me on an average week and that's before you even factor in the fact that I tend to take a holiday every month, along with both a long summer holiday lasting a month and a winter break over the festive period that lasts 3 weeks. So whilst my sister works about 50 out of 52 weeks a year, I probably work 30 to 33 out of 52 weeks a year. Yup, much has been said about how very laid back some countries are when it comes to our work ethic and I'm living proof of it - mind you, I even work far fewer hours than say a nurse, a teacher or accountant would in London. My sister joked that I'm only working part time and I should get a proper full time job. Yet nonetheless, I'm only earning slightly less than her despite working about 25% of the hours she puts in a year. Trying to do the maths to compare her situation to mine is difficult given how extremely different our work routines are - but by one measure, you can say my sister is richer than me because she earns more than me. But on the other hand, her hourly rate is much lower than mine given the number of hours she has to work every week in order to earn that money from her employers.

Working hard vs working smart

It has been raised by one of my readers that this is the difference between working hard and working smart - allow me to go way back to my secondary school days to illustrate this point. I hardly studied as a student for a simple reason: I did a lot of gymnastics and when it was time to revise, I was too exhausted and would literally fall asleep with my face in the books. So there was a lot of last minute revision, like oh shit the exam is in two days and I have to study now or I will fail - so it was by default that I had to work smart under those rather extreme circumstances. Let me tell you about a friend Wei (not his real name), Wei came from a poor, working class family and his parents couldn't afford to pay for expensive tuition for him, yet they recognized that he had to study very hard in order to get good results so he could have a better life in the future. His parents were quite uneducated, so they were no in a position to even try to help him with his homework - instead, they insisted that Wei had to come straight home after school and study until it was dinner time. After he was fed dinner, he had to go right back to studying until it was his bedtime. During the weekends, Wei spent practically every waking hour studying. It was not even a question of spending money - I remember our school had organized some fun sports activities one Saturday and Wei's parents wouldn't let him attend because they insisted on keeping him at home so he could study instead of playing games with his classmates. Despite obviously working hard and studying more hours than any other student in my secondary school, Wei ended up with pretty mediocre O level results - it was not what his parents expected at all as he did study much harder than all the other students in the school!

So what went so wrong with Wei? Well, he was left to his own devices and he didn't know how to work smart - instead, he was copying out his textbook. Literally, he would copy it out page by page, very neatly sometimes without fully understanding what he was copying. He would do the same homework that he had already completed many times before, that way if the same question came up in the exam he would know the answer but if the teacher wanted to challenge us and ask a somewhat different question about the same topic, then he would struggle to find the answer as Wei's method of studying was merely to memorize everything he had been given. I hate to be too hard on Wei because he was just a teenager then, he needed help from an adult to study and when left to his own devices, he could only default to memorizing his textbooks which was enough to help him ace his PSLE but insufficient to help him get straight As for his O levels. His uneducated parents simply didn't understand the difference between working hard and working smart - they saw that he was at home, in his room, busy studying whilst the other boys were out playing football, hanging out at the shopping mall or watching TV. So they kept praising him for being such a good boy, assuming that he would be rewarded with excellent results for having made such sacrifices. Wei's parents would have been appalled at how extremely lazy I was in terms of the number of hours I studied, but at the end of the day, the effort we put in didn't count for anything, the only thing that really mattered were our results. By that token, one can't help but feel very sorry for Wei.

Wei studied very hard but ended up with average grades.

Through social media, I actually managed to track down Wei through Linkedin and I can see that he works for a small Singaporean company today - he isn't particularly successful and I can't imagine that he is making that much money in his current role. But therein lies the problem: people like Wei and my sister are working in a system whereby they already know how much they are going to earn (that's determined by their package) and that is further compounded by the concept of office hours - they are expected to be in the office from at least 9 in the morning till 6 in the evening in order to deal with clients and attend meetings with their team. So in the unlikely event that say Wei finishes everything he has to do by lunchtime one Friday afternoon, he cannot simply say, "okay I'm done, I'll see you on Monday morning. I'm leaving now," and leave the office early. No, he is contractually obligated to stay in the office till 6 pm and he knows that if he lets his boss know that he has nothing to do, then his boss would probably get him to help someone else who has a lot to do and he would go from being quite relaxed to being very stressed again. So what he would do instead is to work a lot more slowly - so if he knows that he only needs another ten minutes to finish a report, he would put off doing that last part until just before the deadline as he has no incentive to submit it before the deadline if he would only be rewarded with more work (rather than say, the afternoon off). He wouldn't be paid any extra if he increased his productivity and completed the report a day before the deadline - he is in an environment which simply doesn't encourage working smart.

In contrast, here's my current situation. 

Sure, in that kind of company, those who fail to meet their deadlines can be punished but those who are super efficient simply are not rewarded. Contrast that to my situation where I am working in sales and am paid commission only when I succeed, so I can spend loads of hours with a client but if I don't close the sale at the end of the day, I don't make a penny from the process and all that time would have been wasted. So I have to become really quite efficient and even ruthless when it comes to deciding which clients I should spend more time with and who is ultimately a waste of my time. So I have a direct financial incentive to focus on where I can deliver the largest amount of sales as quickly as possible. Furthermore, given that I am paid for results rather than the time I work, I have a direct incentive to get the work done as quickly as possible because once I have completed my work, I can relax and go do other things - such as take the afternoon off, go do sports or have a nap. This is why I work so few hours, because I am not paid for my time per se, I focus on doing the most important and lucrative parts of my job and I do them as quickly and as efficiently as possible. So if for example, a company says to me that they will pay me a fixed salary but in exchange, they will require me to be in the office from 9 to 6 every working day of the week - would I be as efficient if forced to work a minimum of say 40 to 45 hours a week? I really doubt it as I'll become a lot less motivated. But let's move on to a different measure of wealth.

My work situation is vastly different from my sister's.

The effects of a safety net on behaviour

Imagine a social experiment where we take a big group of young people camping in the woods and then we teach them how to forage for edible plants in the forest. We also give them fishing hooks and nets so that they can catch fish in the nearby lake. We then split them up into two groups - with the first group, we tell them that they have the rest of the day until sunset to forage in the forest and catch fish in the lake for their dinner, they will only eat whatever they can find in the forest and if they don't succeed, then they will have nothing to eat. In the second group, we tell them that we will have a nice hot dinner waiting for them when they come back from foraging and fishing, but to go out there and try to apply what they have learnt. Which group do you think will work more efficiently in the forest then - the group which is told they have no dinner and they have to find their own dinner in the forest? Or the group who know that they don't really need to work that hard because dinner is already provided regardless of what they do in the woods in the next few hours? What kind of effect do you think the provision of a 'safety net' will have on their behaviour? It is pretty obvious that the group which is told to find their own dinner is going to try a lot harder than the other group. If you remove the safety net of a 'salary package', then you're giving up financial stability and you may think that this may make me work harder - but instead, it has forced me to focus my energies on what I do best and be as efficient as possible. Remember, there's really no point in running in circles around the forest if you're spending all that energy but not actually collecting much edible plants - those in such a situation need to work smart rather than just work hard. They are going to be far more focused on results once they know it has serious consequences - like whether or not they're going have anything to eat.

Savings vs spending part 1: a middle class family in Reading 

So, allow me to introduce you to a couple I have known quite a while, let's call them Mr and Mrs Reading since they live in the British city of Reading. They are married with two children and they are both highly educated, highly skilled professionals with great jobs. Both Mr and Mrs Reading earn a lot of money but they also spend a lot of money mostly because of the kind of mother Mrs Reading is - for example, she wouldn't allow her precious children to eat ordinary carrots. Oh no, her darlings only deserve the very best organic carrots available. At least once a year, they will take their children on a very nice holiday somewhere exotic. Their kids are in a nice school, doing a lot of sports, learning foreign languages and having music/dance lessons. She spends a huge amount of money every single aspect of her children's lives to the point where (to my surprise) they have yet to pay off the mortgage on their first apartment. Don't get me wrong - it's a nice apartment in Reading but because of the way they have a habit of spending penny they earn and not putting away any savings at the end of the month, they are not accumulating any wealth. In fact, they barely have any savings apart from a little bit which they keep just in case one of their kids needs something that cannot be ordinarily covered by their monthly paychecks. So this family may appear to live a really affluent lifestyle (especially if you look at the way they bringing up their kids), but say if either of them loses their job tomorrow, then it would immediately change their financial situation drastically because they are effectively living from paycheck to paycheck with virtually no savings.

In fact, if you were to delve a bit deeper into their financial situation, you could see that this couple are in fact in debt - they owe the bank money for their mortgage, they both still have their student loans to fully repay and on top of that, they often spend beyond their means, racking up huge credit card bills that they don't fully pay off. So on one hand, Mr and Mrs Reading seem to be earning a lot of money and if you look at their consumption patterns, then they do indeed consume a lot of the nice things in life that rich people do. So how do you classify whether or not this family is rich? It seems they do tick at least two out of three boxes for being rich in terms of earning a lot of money and consumption patterns, but I suppose quite a morbid way to look at the issue would to ask the question: if Mr and Mrs Reading were tragically killed in a car accident today, what would their two children inherit from their parents? The answer is "probably not that much". That's a nice flat in Reading that they still haven't been able to pay off and given that neither of their children are in a position to take on that mortgage (they are still in school), that flat would have to be sold off and the children can then inherit whatever amount of money that sale would raise. There would also be the contents of the house which they do own (they have some nice, expensive furniture for example), but unless Mr and Mrs Reading have bought some kind of life insurance policy, their children are not going find any money in the bank waiting for them beyond a few hundred pounds at best. So by that token, they are poor. So how would you classify someone like the Reading family: are they rich or poor and is their situation unique? Hardly, many families today do find themselves in the same situation.

One would like to believe that with such a good childhood, the kids in the Reading family would have very good chances of getting into a top university and that would in turn lead them to get a very good job. But apart from that, say in the future, one of them turns to his parents and asks, "hey mom and dad, I have a great business idea, I need some money to start a business, can you lend me £25,000 please?" The answer would probably be no, because Mr and Mrs Reading are spenders, not savers. Are they poor? I don't think so, certainly we know what poor people look like - we know the struggles they go through and the sacrifices they have to make when they simply don't have enough money to buy everything they need, the Reading family's situation is not like that at all. Certainly, we can play around with words and labels - this family is definitely middle class based on their earning power and lifestyle, but are they rich? I would really hesitate to call them "rich" in the absence of any tangible wealth. There's a phrase we use in banking to describe rich people: high net worth individual (HNWI). Quite simply, we take a look at all your assets including your savings, how much bonds, stocks and shares you own as well as money in any kind of investment schemes, then we add to that any kind of property along with things of high values like cars, yachts, private jets, art etc and then we arrive at a number that is the total value of all your assets. If that number is high enough, like if it exceeds one million (in US dollars), then you can probably be classified as a high net worth individual. Mr and Mrs Reading are not HNWIs and they could become HNWIs one day if they start saving and accumulating wealth - but that would mean cutting back a lot on their spending.

Savings vs spending part 2: Hai's mother

I had this friend in secondary school - let's call him Hai. His family was rich, I understood that his father was a businessman who had a lot of business interests in China and hence his father was away in China most of the time whilst his mother was a housewife. They had plenty of money and she didn't need to work at all, but the strange thing was that Hai's mother came from a very poor family and wasn't used to all this wealth. So despite having access to all that money, she was very hesitant to spend any of that money and at times, came across as quite mean with money. For example, whilst the boys in my schools would all love to have nice trainers (our school allowed us to wear any kind of trainers or sports shoes to school), Hai would only wear the cheapest plain Bata school shoes as his mother thought it was a waste of money to spend hundreds of dollars on a pair of trainers from Nike or Reebok. Hai wasn't even given pocket money to buy his own food in the canteen during the breaks - his mother would pack sandwiches and fruit for him to bring to school and he would have to go home to have lunch as she thought it was a waste of money to eat out. I knew Hai really looked forward to spending time with his father when his father returned from China as that was when his father would take him out shopping for things like clothes, bags, comic books and shoes and also take him to eat delicious meals in expensive restaurants but when his mother was in charge, he led a very frugal lifestyle. Many of us felt sorry for Hai because we thought his mother was so mean to him, but she also never spent any money on herself either.

Hai's family wasn't poor but they were frugal.

I had an insight into Hai's mother's mind when I visited his house one day - there was an air-conditioning unit in the living room but he said that they were only allowed to use it when his father was home. His mother thought that it was very expensive to turn it on each time because the air-con would be "非常吃电" (consume a lot of electricity) and she didn't want the family to be bankrupt as a result of a huge electricity bill. The fact is she didn't even know how much the monthly electricity bill was - she was simply a creature of habit to try to save as much money as possible because she came from a very poor family. I then stumbled upon a strange display case in the house: it was full of expensive looking designer handbags, jewelry and women's perfume. Everything was brand new, the perfume bottles were still in their original packaging and unopened. Hai explained that his father would buy his mother gifts each time he returned from a business trip to China, but his mother would simply put the gift into the display case rather than use it. She actually really liked one of the handbags in the display case, "the Gucci one is her favourite, she would take it out to admire it gently, clean it, then put it back inside the display case so it is always in a pristine condition." Her behaviour seemed weird to say the least, she was afraid to take her favourite handbag out of the house just in case she would dirty it, damage it or even lose it. So she actually carried around a very old handbag which even Hai described as "破破烂烂" (broken and rotten). It wasn't even that she was saving the expensive handbag for a special occasion - she just preferred to keep it in a big glass display case under lock and key at home. Needless to say, Hai had a rather poor relationship with his mother.

So in Hai's mother's case, did his father earn a lot of money? Yes, he most certainly did. But did Hai's mother spend any of that money? No, quite the opposite, in spite of the fact that they had a lot of money, Hai's mother lived as if they were struggling to make ends meet. Who knows what the hell was going on in that woman's warped mind. Maybe she was convinced that she would teach Hai the values of being humble by refusing to spend any money on him or herself, or maybe she felt that she didn't deserve to have nice things in life like expensive designer handbags. But were they high net worth individuals? Well, the answer was yes. They owned the big house they lived in, Hai's father's business was worth a lot of money and they had plenty of other tangible assets along with money in the bank. So in terms of earnings and assets, they were definitely rich but in terms of their lifestyle, Hai and his mother did not lead the kind of lifestyle that one would expect rich people to have. But if Hai's parents had died in a car accident when he was 16, they would have left him an enormous amount of money, making him a multi-millionaire teenager. There is a huge difference between the Reading family and Hai's family - but which family would you consider properly rich? Are they both rich? Your answer would depend on which measure you wish to use to ascertain their wealth: earnings, lifestyle or assets. Hai is a very successful businessman today with his own family and he is not on talking terms with his mother anymore. Well, she is still living an extremely frugal lifestyle after Hai's father passed away some years back and he had left her a lot of money.

Are you taking advantage of your wealth? 

So one thing is clear when we compare and contrast these two case studies: the Reading family are happy. Oh they are enjoying a great family life, Mrs Reading enjoys giving her children the very best of everything and she is a good mother - providing for her children does bring her a genuine sense of joy. This is because I know she had a difficult childhood when she didn't always get everything she wanted, so she wanted to make sure that her children will never have to face the same hardship. Okay they may not have much savings, but they're spending their earnings on nice things for their family to enjoy. Whereas in Hai's mother's case, I suppose in some perverse way, she derives satisfaction in knowing that the money is in the bank - the same way she knows that her expensive designer handbags are in that glass display case at home under lock and key but she is not consuming in the way the Reading family are. After all, what's the point of having wealth if it doesn't bring you joy? This reminds me of a rather sad story I read sometime back - there was an old lady in India who fell sick with malaria and she couldn't afford the medicines. So a kind rich man gave her the money to buy the medicines and she was very grateful - but being poor, she didn't dare spend the money just in case she needed it for something else and she was hoping to recover without spending the money on the medicine. So when the rich man saw that she was still unwell, he bought her the medicines and still, she refused to take it because she thought, "if I can get well without the medicines, some people with malaria manage to get well even without those medicines, maybe I can then sell the medicines for money." Eventually she died of malaria despite having both the medicines and the money for treatment - the rich man's wealth couldn't save her from her refusal to accept help and spend the money.

Allow me to give you another simple case study to make a point about benefiting from your wealth: I went to the local supermarket the other day which is about a 6 or 7 minute walk from my house. After I had done my shopping, I emerged from the supermarket only to realize that it had started raining. I was somewhat surprised as it wasn't raining when I had walked to the supermarket but the skies have opened whilst I was in there. I didn't think I had an umbrella with me and wasn't prepared to wait indefinitely for the rain to stop, so I decided to walk home with my groceries in the rain and get wet. When I got home and started taking out the groceries from my bag, guess what I found at the very bottom of my bag? An umbrella - I suffered the consequences of being forgetful. Even if you do have the means to make your life better (such as having an umbrella to keep you dry in the rain), if you choose not to use it for whatever reason, then you will still suffer the consequences just like those who don't have the means. So in Hai's case, his mother refused to spend money on getting him extra tuition on the basis that it was a waste of money and he should learn to figure it out for himself - contrast that to even the poor kids whose parents would even skip meals just to be able to pay for their private tuition in order to make sure their children got the best possible grades at school for a better future. As a result of Hai's mother's adamant refusal to spend more than the bare minimum on his education, his grades suffered and he would have undoubtedly benefited from some additional help. Therefore in terms of Hai's education, his parents's wealth gave him no advantage at all over all the other students who were not as rich because of his mother's very bizarre behaviour. 

The role of behaviour in wealth

One's wealth will only have a real impact on the quality of your life if you're willing to spend it - otherwise it is as effective as the malaria medicine that this poor Indian lady refused to take despite lying there, dying of malaria. Poor people die of diseases like malaria because they cannot afford the medicine but stupid people die of malaria if they refuse to take the medicine given to them for free. If your irrational behaviour prevents you from taking advantage of your wealth, then should you be considered rich? One could argue that behaviour should play a big part in determining whether or not you should be considered rich in the first place both in the case of Hai's mother. You see, it doesn't matter how much money you have in the bank or how many expensive designer handbags you may have in a glass display case at home, if you insist on behaving as if you're barely able to make ends meet, then that's your reality. So perhaps we should consider people like the Reading family rich and by that same token, Hai's mother poor. Mr and Mrs Reading enjoy much higher social status than Hai's mother. After all, it's more than just spending money on expensive things to enjoy that identifies you as rich - it is about where you belong in society. So let me use a classic example: rich old men like to join exclusive golf courses as a status symbol, because you are able to mingle with other rich old men on the golf course. So it is not the money they have spent on the golf membership that defines their social status, it is the fact that they are accepted in that very exclusive club of very rich people that affirms their high social status. So your money in the bank is not going to earn you that high social status until you start spending it on such activities that gains you access to those social circles.

Dismissing the role of envy and jealousy in wealth

Whilst we're talking about behaviour in wealth, I think it is important to dismiss one other very important and common reaction to it. When we meet people who are extremely wealthy, of course we feel jealous because we don't have that kind of money. The worst pangs of jealousy are experienced when we come across kids from rich families - they have done absolutely nothing to contribute to their family's wealth, they just happen to have had the good fortune of being born to rich parents and could enjoy the benefits of their parents' wealth. I remember there was this kid (let's call him Paul) in my class back in primary school who had all these expensive toys - I thought, it is not fair, why does his parents buy all these nice things for him but my parents never do the same for me? I was consumed by envy, I wished that Paul never had all these toys because I was jealous. This is why poor people like rich people like Hai's mother - we celebrate them as humble heroes or even role models for the rest of us poor folks, but what is really going on is that we're happy when rich people act like us poor people because we don't want to be reminded that rich people have all these wonderful advantages that their wealth can buy. That's really no different from the way I felt each time Paul showed up at school with yet another expensive toy that I know my parents will never be able to afford to buy me. So that is why people like Hai's mother are often put on a pedestal by other poor people for all the wrong reasons: we don't experience as much envy or jealousy when we see rich people behaving just like us poor folks. I remember someone praising Hai's mother, claiming that because of her humble behaviour, she will not bring up a 'spoilt brat' as a result. Many people won't like to admit that they are jealous of rich people, but it is a really destructive emotion that poisons most of us from time to time.

Case study: 刘老板 is having a bad day in Kaohsiung

Meet Mr Liew from Taipei who is a multi-millionaire tycoon in his 60s - credit where credit is due, he is a self-made millionaire who built up a business empire from nothing through years of hard work in the construction industry. His company had a reputation for quality service at low cost because they don't waste money. So despite the fact that he is extremely wealthy now, he still behaves as if he needs to save money at every opportunity. I have a friend who used to work for Mr Liew (let's call her Christine, not her real name) and she told me that Mr Liew was so frugal with money that he only owned two business shirts - one would be in the wash whilst he wore the other. When Mr Liew went on a business trip, he would wash his shirt in the hotel bathroom. There was no valid reason why he had to behave like that - Mr Liew lived in a big house in Taipei and had so much money, yet he believed that somehow in preserving certain aspects of his frugal behaviour as that was the principle that made his business successful. Well, let me tell you what happened on a business trip to Kaohsiung in the south of Taiwan. One morning during breakfast, he accidentally knocked over some dark soy sauce on the table and it splashed all over his shirt - leaving some really unsightly brown stains on his shirt. There was no way he could go to the business meeting looking like that. So he dashed back to his hotel room only to find that the shirt that he washed the last night was still quite wet. He asked the staff in the hotel for an iron but this being a really cheap hotel, they don't supply the rooms with iron though they managed to get him a hairdryer. So Mr Liew was desperately attacking his wet shirt with a hair dryer when Christine reminded him that they were already running out of time. They had to be at their first client meeting in about 50 minutes but they still had to travel across town.

Mr Liew had to accept that the only thing to do was to buy a new shirt for the meeting and as the hotel was in a retail district in Kaohsiung, it wouldn't be hard to buy a men's shirt there. So Christine and Mr Liew ran to the first shop across the street from the hotel which sold menswear and Mr Liew picked the cheapest shirt there. Christine was aghast at the selection that Mr Liew made, she described it as the kind of shirt an old farmer from rural Taiwan would wear rather than something that would be suitable for a business meeting. She tried hard to persuade him to buy a nicer, more expensive shirt for the meeting given how important this client was to the company but he simply refused to listen to her - he even criticized her for wanting to waste his money on things like that, accusing her of being vain and superficial. And as if things weren't bad enough, Mr Liew started  furiously bargaining with the shopkeeper for the cheap shirt when they were almost certainly going to be late for that meeting. Finally, Christine managed to convince Mr Liew that it was not worth saving a few dollars by bargaining if they were going to give the client a bad impression by turning up very late for the meeting, so begrudgingly Mr Liew paid for the shirt. But despite being so late for the meeting already, Mr Liew insisted that they needed to take public transport to meeting rather than just jump in a taxi. Needless to say, they arrived very late for the meeting with Mr Liew dressed like a farmer from rural Taiwan and unsurprisingly, the client were not interested in doing business with them after that meeting. Christine knew it was entirely Mr Liew's fault that the meeting went that badly, but it was impossible to get a stubborn old man like him to recognize his own faults. I am pleased to tell you that Christine no longer works for him - she has found a much better job since. Oh Mr Liew was not a nice person to work for!

Why the rich get richer (most of the time) and the poor get poorer

An important reason why the rich get richer and poor get poorer is because the rich have the financial means to solve a lot of the problems that life throws at them. Mr Liew's bad morning in Kaohsiung could have been rescued with money: all he needed to do was to buy a decent shirt for the meeting and then rush to the meeting in a taxi, that would have saved the day. But Christine was aghast at how he jeopardized and lost a multi-million dollar contract just because he wanted to save a few dollars - it made no financial sense at all. Should you spend $100 if it would help you earn $1,000,000 in the process? Yes of course, especially if you knew that saving that $100 would mean losing the $1,000,000 - you can't argue with the numbers. Now imagine a poor man from a rural village in Taiwan traveling to Kaohsiung for a job interview, he stops off  at the station to get some breakfast and spills some soy sauce on his only decent shirt that he has worn for the job interview - however, he is so poor that he doesn't have enough money to buy a nice new shirt in Kaohsiung or to then rush to his interview in a taxi. So he ends up doing what Mr Liew did - buying a cheap and nasty shirt from a street vendor and turns up for the interview late. As a result, our poor man from the rural village doesn't get the job he had hoped for. That's the kind of stupid shit that happens to poor people because they simply don't have the money to solve their many problems in life and often, these can have long term consequences that trap them in poverty for years, even decades. Mr Liew is an exception because he refuses to use his wealth to gain more privilege and make more money: poor people may put him on a pedestal for living just like them, but in my opinion, I think he's incredibly foolish, irrational and shortsighted. People like Mr Liew may become rich through sheer hard work but will they stay rich in the long run?

I could go on but I think this is a good place to stop. So over to you please, have you ever met someone like Hai's mother or Mr Liew? What is your relationship like with money? Do you know of middle class families like the Reading family who have a rather good quality of life but have practically no savings and are also in debt? Are you able to accumulate wealth or do you see wealth accumulation is not a priority if it is simply going to turn you into Mr Liew? Which is more important to you - spending or saving? Let me know what you think please and leave a comment below. Many thanks for reading.