Tuesday, October 12, 2021

Why Do I Keep Worrying About Having Not Enough Money?

The fear is real... the worry of having not enough money is causing me sleepless nights sometimes. Is this normal I ask myself? I have savings, I have a stable job and earn a decent fixed monthly salary. I have enough to live my life and still having savings every month. But there is one thing I am constantly worried about, and that is having not enough for retirement. 

No matter how much I budget and plan and forecast, there is still a lingering worry in me even though I try to assure myself as much as possible that its all ok. There is one reason I identified, the reason is the future is so unpredictable that there is no way to actually predict what will happen. Even if I plan all the way, the outcome may still be not what I want it to be. 

Life throws in all kinds of nonsense at you along the way. I'm lucky not to have met too much nonsense thus far but I've seen nonsense being thrown at people and depletes all their savings instantly due to high medical bills and long term healthcare cost. 

There are many Singaporeans who do not have to worry about money. We can see it on social media channels Youtube, Facebook, Instagram, Tiktok. Many people have the means to renovate their house nicely, buy a car, buy a luxurious condo, stay in 5 star hotels and eat good food all day. Some are spending beyond their means, some do not plan for the future but there are some who really have too much money to spend because they earn extremely a lot too. 

For me, spending money was a taboo all my life. Yes its hard to spend money because we always didn't have much anyway. When its my turn to spend money, I buy nice furniture for my house, eat good food, spend on luxurious staycations because I can afford it but guilt sets in. Its a funny feeling of enjoying but at the same time fear.  

Psychologically, I would think I need a breakthrough. Its like when you first started investing and you are brought on an emotional ride of thrill when the market goes up and fear when market goes down. Its not easy to overcome but as years goes by, you get better at it. 

I'm not sure if anyone has the same thoughts and experience as me but if you do, I would encourage you to keep going when it gets tough. The light is always at the end of the tunnel. Worry is a normal process and it should spur us to achieve more in life. 

18 comments:

  1. Hello, just want to encourage you that I really empathise with a lot of what you've written here. There are some differences like worrying about being able to provide a good life for future children and I avoid social media, but am certain many young adults have similar anxiety too. It's not easy when prices of everything go up but median wage doesn't follow proportionally, the 90% gets left behind. Let's be grateful for what we do have, keep pressing on and being brave together.

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    1. Yes, another worry is not being able to provide a good life for your loved ones. Thanks for the encouragement. Keep pressing on!

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  2. Save the money you earned
    Invest!
    Spend the money you gained.

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    1. Hi EK,

      Yes that's the way to go. After doing this for the past 10 years plus, it gets tiring though with expenses going up. Sometimes i feel I'm out of control probably bec i like to be in control so much with all my believes in planning.

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  3. can relate to your statements, and sure enough, it's a tough battle.

    keep the grit and grind on!

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    1. Hi jun,

      Looks like I'm not alone. Let's keep moving and never give up!

      Delete
  4. As single household income with three children; I have been worrying since 1990s and stop worrying over money past 10 years but worrying over health scares. How much of these health scares are within our control? Some degrees of worries are healthy as they help us to be on alert and not too complacent that life is easy going even financially we are secured

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    1. Hi Uncle CW,

      Thanks for sharing your experience. I guess its normal to worry when we are just starting out in life. You did well financially in the end. You're right health is a worry we can't control though.

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  5. If you stopped working today, how long can you last without a job? If you can last 3-5 years, you'll be fine. Having adequate insurance is of course important (BTIR for me personally)

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    1. 3-5 years shouldn't be a problem but it will drain my retirement funds drastically. For me, i know i can't afford any time without a job even when i have the money to still live my life but i worry about the future more of having not enough for retirement. Insurance i have adequate too and i also BITR.

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  6. Hi SGYI

    It is quite natural that people worry about their finances, and it is this worry that spur people to do something about it. To examine and reduce their expenses, to save and invest and to earn more as well as to work longer (eg. to delay retirement).

    However if this worry starts to disrupt your sleep then it can become problematic because having good quality and sufficient sleep (7 to 8 hours a day) is necessary to maintain good health. To have good quality sleep, I would suggest keeping to a regular sleep routine such as sleeping at 1030hrs or 1100hrs evey night. Try not to sleep too late.

    I have not lost sleep because of finances but more because of work stress, family issues and other stuff. Maybe it was because both my wife and I work that we always felt that we are a back up for each other. So that knowledge gave us great peace of mind.

    Over the years, we have been building up our passive income sources to eventually take over our earned income as we retire. My wife retired in Jan this year because we assessed that our passive income sources are established and the amount is quite adequate. I am still working.

    This is our combined passive income amount and sources (actual & projection) at different stages of our life going forward:

    Now at 60 (2021) to 61 (2022)
    Dividend : $64,000 pa ($54,000 received as of Sep 21)
    Rental : $36,000 pa ($35,000 for this year)
    Interest from OA & SA : $55,000 pa (projection based on 11 months of interest)

    62 (2023) to 69 (2030)
    Dividend : $64,000 pa
    Rental : $36,000 pa
    Interest from OA & SA : $58,000 pa (projection based on 11 months of interest)
    SRS drawdown : $43,000 pa (drawdown over 8 years)

    70 onwards (2031 onwards)
    Dividend : $64,000 pa ($54,000 received as of Sep 21)
    Rental : $36,000 pa
    Interest from OA & SA : $58,000 pa (projection based on 11 months of interest)
    CPF Life payout : $60,000 pa

    The CPF savings (OA & SA) and CPF Life serve as the foundation for our retirement income and we are prepared to live within the amount of $58,000 (OA & SA interest) + $60,000 (CPF Life) = $118,000 pa should our other sources fail us.

    So remember to buff up that humble CPF savings as it can really provide great peace of mind, an important ingredient to a good sleep at night, every night.

    All the best!

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    1. Hi mysecretinvestment,

      Wow your finances are planned out nicely. Great sources of passive income to enjoy your retirement years. Thanks for the advises and all the best too!

      Delete
  7. Personally, I think we cannot worry about the things that are out of our control like Health, Accidents and the list goes on.

    Just look instead at opening up more revenue streams and accumulate your assets?

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    1. Hi Kai,

      You're right shouldn't worry about things that are out of control. Continue building more revenue streams is the right way to go!

      Delete
  8. Hey SGYI,

    I think as I delved more into this, a permanent fixture is that a lot of these things are uncertain. Future market returns, our longevity and health, career, inflation and deflation of things, our decisions and spending.

    This means that planning today and not adjusting is damn difficult. If so, how do we determine the cut off point to retire?

    I think we need a system that works when most things are uncertain.

    Here are some that I can think of. It doesn't mean I achieved it but I think it helps.

    1) Find work we feel challenged and look forward to (this is damn hard for some of us as we always feel like we are on a hamster wheel)
    2) Strong body and mind. That cures against depression and give us vigor to live life. Don't have this we cannot even side hustle if we want to.
    3) List out your expenses. Line them up from the most essential to the least. Then try to secure them in a conservative manner. Conservative as even if inflation runs rampant or the portfolio does not grow, you could at leas secure it. For example, if your mobile phone is the most essential that cost $120 a year. If we use a conservative withdrawal rate of 2.5%, that means we need a portfolio of $4,800. How many of your most essential expense can you collect? I am sure for you it will be a few items. We may get very beaten down by thinking we need to secure all our expenses then we reach the finishing line. But if the world is uncertain, what we are afraid off may be that part in our child hood that we are afraid we made a stupid decision and end up with nothing. So make your portfolio "insure" against that scenario. As a able working person, you might be able to offset your current expenses with your work. We learn to work but be less worry that losing our job will totally kill us.
    4) Work on the relationships. Over time I realize whether its work opportunity or on a personal level, many things come to us because of the relationships we build up.

    World can be uncertain but we can try and secure some of these uncertainy.

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    1. Hi Kyith,

      Thanks for the thoughtful reply. You're a deep thinker too and think through lots of scenarios to plan for the future. I like your ending. The world is indeed uncertain but we try to secure sone of these uncertainty.

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  9. Pls do update - with the current economic,financial impact due to rusia-ukraine, and the recovery... also wondering what are your view into the cryptocurrency for now and future.

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    1. Hi,

      There has been quite a lot of economic changes around the world lately and I'm sure we are all facing the cost pressures from rising cost as well as the recent drop in the stock market. For me personally, it is still early to tell whether the cost increase will affect my expenses significantly but I've factored in enough buffer in my budgeting so I would think I should still be on track for my retirement planning. As for stock market, yes it is facing some downward pressures now but I hold a long term investment view and I still get dividends from most of my stocks so its not too bad.

      As for cryptocurrency, I'm not really a fan of it from the beginning so did not really invest into it. There were times when I was tempted to jump on it seeing how many people have made a fortune from crypto but now looking back, i might have saved myself from serious financial ruin by not investing in it. It is something that I'm not familiar with and have struggled to understand so I will not invest in something I'm not familiar with.

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