5 Balls of Life

‘Imagine life as a game in which you are juggling some five balls in the
air. You name them – work, family, health, Friends and spirit and you’re
keeping all of these in the Air.
You will soon or one day understand that work is a rubber ball.
If you drop it, it will bounce back.
But the other four Balls – Family, Health, Friends and Spirit – are made of
glass. If you drop one of these; they will be irrevocably scuffed, marked,
nicked, damaged or even shattered. They will never be the same. You must
understand that and strive for Balance in your life.’ - Bryan Dyson (CEO of Coca-Cola)

Formula for Success

Today I read the book I bought 2 years ago, 'Your Right to be Rich' by Mal Emery. I just opened randomly at the middle of the page and found something interesting to share here.

According to Mal, there are 4 basic things that we need in order to success:
1. Decide what it is that you want and be specific. Write it down in detail and read it 3 times daily.
2. Believe that you can actually achieve what you've written down and be willing to pay the price.
3. Take action to make it happen!
4. Lastly, the best way to get result is to model someone who already doing what you want to be doing.

These are the things that basically needed for anybody to success in anything they desired. Sound familiar? Yes, I have mentioned some of the points before. And if you go and talk to anybody who are successful, this would be the basic things most of them will explain.

Michael Gerber, the author of best-selling E-Myth once give a talk in a seminar and during his opening speech he mentioned "If you guys have come to hear something new, you're not going to! You see, the problem is you guys ain't doing this sh-t!"

In-fact 98% of people already know this and they lack of step no. 3. I myself have to admit that I have not really there yet at step no. 3. It is not something which is easy, yet it is not difficult either. But most people who is already in the comfort zone will not take any action until the situation become uncomfortable.

So, first of all I need to remind myself to take the first step. How many among us are reading the dream list every day, or every week, or every month?

Delayed Gratification

Have you ever heard of the terms "Good thing comes to those who wait"?

So what is delayed gratification? According to Wikipedia

"Deferred gratification or delayed gratification is the ability to wait in order to obtain something that one wants. This ability is usually considered to be a personality trait that is important for life success. Daniel Goleman has suggested that it is an important component of emotional intelligence. People who lack this trait are said to need instant gratification and may suffer from poor impulse control."
Read more on wikipedia.

How does it work? It is just emotional stuff which if you can conquer the skills, will benefit you a lot. Studies have shown that a person ability of delayed gratification can cause huge success in one's life. The famous experiment was done by Walter Mischel, who invented the marshmallow test. A group of kids were given a marshmallow and they offer another marshmallow if they can wait to eat them for a period of time. Some of the kids just can't resist and ate them while some others can wait, and be rewarded with a double amount of marshmallow. So what happened next, they keep track of these kids a few years later and find out that the person who can wait achieve significant success in their life.

read more at mindhacks
More on the marshmallow experiment, you can read the secret of self-control.

This is how emotions and motivation affect a person. Most of the time people who wanted something in a short period of time will always lose more. Take the 'get rich quick', ah long borrower and briber. They always wanted a short cut to make more profit. But at the end of the day, they are the losers.

On the other hand, people who can wait especially on sure things will always be rewarded more. A simple example is the unit trust or ASB. We know the guaranteed return of ASB, but most of us rather withdraw the cash and spend on some good unnecessary stuff (which is immediate gratification) immediately after we receive the pay-check.

People can make more money from this natural human habit in stocks and bond. When the price goes up, many people with immediate gratification will buy all the stuff expecting a quick return and later losing money. But wise people like Warren Buffet, prefer to invest during a slow economy because it takes time for the economy to recover. But it is surely after the economy going on track, they will make a lot of money.

So why do you think people are spending more stuff when they received their bonus when they know a guaranteed return waiting for them at ASB?
Why most people don't want to involve in business or become an investor?
One word... delayed gratification.

The Japanese and The Fresh Fish Story

This is a good one. I took it from an e-mail forwarded to me by one of my friend.

The Japanese have always loved fresh fish. But the water close to Japan has not held many fish for decades. So to feed the Japanese population, fishing boats got bigger and went farther than ever. The further the fishermen went, the longer it took to bring the fish. If the return trip took more time, the fish were not fresh. To solve this problem, fish companies installed freezers on their boats. They would catch the fish and freeze them at sea. Freezers allowed the boats to go farther and stay longer. Ho wever, the Japanese could taste the difference between fresh and frozen fish. And they did not like the taste of frozen fish. The frozen fish brought a lower price. So, fishing companies installed fish tanks. They would catch the fish and stuff them in the tanks, fin to fin. After a little thrashing around, they were tired, dull, and lost their fresh-fish taste. The fishing industry faced an impending crisis!
But today, they get fresh-tasting fish to Japan .

Ho w did they manage? To keep the fish tasting fresh, the Japanese fishing companies still put the fish in the tanks but with a small shark. The fish are challenged and hence are constantly on the move. The challenge they face keeps them alive and fresh!

Have you realized that some of us are also living in a pond but most of the time tired and dull? Basically in our lives, sharks are new challenges to keep us active. If you are steadily conquering challenges, you are happy. Your challenges keep you energized. Don't create success and revel in it in a state of inertia. You have the resources, skills and abilities to make a difference.

Take a Risk, take a chance. Put a shark in your tank and see how far you can really go!

Value : Who decide

I learn a lesson last week. I have a long chit-chat with one of my good friend and we talk most about financial and life. We share our opinion and thought and I think it's great to exchange view on your opinion with one another.

What he thought me last week?
He asked me a question. If I gave you RM5 and 50c, which one will be more value to you? I am clueless, thinking what is the trick and the message he wants to deliver. Just to get the answer done, I told him RM5 and waited for the answer of the puzzle. Actually you who decide the value. It doesn't mean that the higher the amount, the higher the value. But you yourself decide!

Sound very simple and tricky. But it is relatively true. If you think back, do you think RM10 is a big amount? The same number can give different answer to different people, different situation and different environment. RM3 for a can of coca-cola will sound very expensive at a stall. But when you go to hotel or pub, the value can reach RM10. The hotel maybe located 10 meters away from the stall. So, number is just a number.

Let me give some example from my experience. Last month I had a minor broke period when it near to end of the month. Suddenly somebody gave me RM30 and I find out that RM30 is very valuable to me at that period of time. But if gave me during I received a bonus, do you think I will value the RM30?

Get excited when you receive money. Don't look at the numbers, but if you can get excited even to a very small amount, you are actually attracting it. Don't complain and always be grateful. Than you will attract the good thing coming your way!

Sub-conscious Mind: Basic Comparison

I would like to share something on conscious mind and sub-conscious mind. This is one of the most powerful tools on the universe. In general, sub-conscious mind is a result of programming, either pre-programmed and programmed by you environment or your past experience. The best thing is you can program your mind.

So, what is sub-conscious mind?
I give you a few example. When you learn how to drive a car, you conscious mind will first think what to do next. How you control the fuel, brake and clutch paddle. But when you keep on repeating the process, it become unconscious. You don't think when to press the gas or inserting the gear. Automatically when a car comes near you, you press brake. This is sub-conscious mind.

Same as when you talking. If you learn new language, you need to think words-to-words in order to create a sentence. But if you are a native speaker, the words come out spontaneously. Why this happened? It is a sub-conscious mind job.

Some of the part of our brain is preset. For example breathing and eye blinking. Others need to be train before it become sub-conscious.

Why subconscious is powerful ?
Same like programming. Programming is a very powerful tools. You can do anything with program that you create once. For example, Microsoft Windows. Very difficult to write is once and you need to optimize your thinking. But once it is done, the things will run by itself. When we detect some bugs, then just require minor fixing to fix the bugs.

Basic Comparison on conscious and sub-conscious
1. Conscious will focus on future. Just like first time driving, you conscious mind will thing about changing a gear a few moment before you actually change the gear. But sub-conscious mind will do it at present.
2. Conscious is more flexible. You can choose to change gear two or three depends on whatever you think. But sub-conscious rigid, when you normally after gear one, you will change to two, that is what you'll always do. If after wake-up you immediately go to bathroom, that is what you will always do, unless your conscious mind change it.
3. Conscious will more sensitive to positive information. If you are by someone about a benefit of reading a book for example, you conscious mind will start to think on the positive benefit and you'll start to think you must read a book. But sub-conscious mind are sensitive to negative information. Let say you are offered a new better position, your sub-conscious will start thinking, oh it is a hard work, what if I cannot perform, the job location is too far from my house etc etc.
4. Conscious is after-the-fact checker which means after knowing things is good, you will start doing it, while sub-conscious is a pattern detector - it works based on pattern that you set. For example, if you often brush your teeth after wake-up, you will try to follow the pattern everytime you wake up.
5. Conscious is a single system while sub-conscious is multi-system.

Why you need to know all these?
By knowing the potential power of these two types of mind, you can optimize in anything you do. How do you do it? Example when you start to think about stop smoking, you conscious mind will do the temporary thinking which stored into you RAM that you must stop smoking. But after a few while, the memory is gone, your subconscious part which store inside your hard disk will start to retake the position of whatever you do. If you realize this, you will put on the new thinking using your conscious, until it re-write the subconscious part into your hard disk and let it run by itself.

Did you realize, human have the ability for total control on both part of mind. Animal do have brain but the brain is more on sub-conscious mind. That is why duck can swim since hatch from their egg, bird can fly, dog will run and catch when you throw something, and on and on. But they can never change all these basic character. But you as a human, you have the ability to change whatever you wanted. That is why human being is so special!

Use it to change your habit, perspective and thinking which most of them is pre-set by your past, your surrounding and your environment.
Whatever you do, your thinking will always play the most important role, not your hard work. That is why Napoleon Hill wrote a multi-million best seller 'Think and Grow Rich', not 'Work hard and grow rich'!

Create your thinking and create your own program!

The Jars

Picture credit to: http://www.freedomeducation.ca/2007/11/13/managing-money-the-jars-system/

Last month I attended T. Harv Eker's Millionaire Mind Intensive Seminar. I think the most make sense and easy to do is the jars. This is the simplest money management in the world.

So, how does the jars work? First step is to prepare jars. (it can be cookie jars, tupperware, bank account, or anything that you wish to). Label it as :

1. FFA - Financial Freedom Account. 10%
2. LTSS - Long Term Savings and Spending. 10%
3. EDU - Education. 10%
4. NEC - Necessity. 55%
5. PLAY - Play or anything not necessary you buy. 10%
6. CHAR or GIVE - Charity or Give away. 5%
Note : You can always adjust the amount according to your own preferences.

Details :
By logic, the universe (or in muslim I prefer to call it as God) will only re-act to those who can manage things properly. The jars will help you on the managing the money. Imagine if there is somebody begging you for money, immediately after you give him RM10, they spend it on buying cigarette or gamble the money. Would you give him more? Absolutely No! But instead his buying some food, save some money, give RM1 to his friend who also needed etc. would you think you want to give him more money? Absolutely! The same thing goes here.

1. FFA. Why we need it? Have you ever heard the story of the golden goose? FFA is the golden goose, or at least treat it as one. Golden goose will lay eggs as long as it is alive. So, it is important not to spend any of the amount that you already put in your FFA. This FFA money only can be allowed to put in at an investment vehicle (and treat it as we already spend that money) and we can only use the dividend. In this case we don't care the economy goes up or down, cause we are not going to sell the units anyway. And the dividend is our passive income, which means when the amount of FFA grows, our passive income also will grow!

What happened if you receive the dividend? I recommend you treat it as your income, and again divide your money into 6 portion. In this way you can get 10% of your income re-invest into you FFA, so the fund will grow!

So what happens when you passed away one day? Write a will, give it to your children? No! This money cannot be given to anybody! But it shall remain inside the investment vehicle or at least put it into another investment vehicle. But the dividend payout can be enjoyed by your generation. Maybe more than seven generation!

2. LTSS. For sure everybody got something they wish to have. The good thing about LTSS is you save to spend. Maybe you like the iPhone (I like it too!), having the latest VIAO laptop or the SLR camera. Put it on your wishlist, and when the fund is ready, just spend it! Traditional way, you might bought something by withdrawing your savings or when you receive your bonus. But put aside some money, purposely to use it on whatever you wanted. Doesn't it feels cool to have the latest gadget?

3. EDU. In order to increase your financial knowledge or financial intelligence, it is important to have education. For myself, to educate, I bought a lot of books and attend some seminars. Hanging around the internet of course your can get the information, but trust me, the education from reading books or seminars is far more valuable! You can also use this fund to educate about your religion or your hobbies (like me, I am the guitar freak, attending a class also can use this fund).
Btw, this fund have close relationship to your FFA, as you might need the knowledge on the best investment vehicle, technique etc etc. So, you need to fully utilize this fund.

4. NEC. Of course you need to pay your bills, mortgage, loan etc. Also you need to eat, buy pampers (if you got kids), buy the groceries, shampoo, toothpaste and whatever necessary. That is why this fund should have the highest percentage!

5. Play. Don't just save. Sometimes you need to get some leisure. Don't you think it is good to eat at a first class restaurant. If you are music freak, go to jamming. Ride a roller coaster at the Times Square or Genting Highland (but guys, don't play the Casino please!). Enjoy yourself. Enjoy with leisure!

6. Give. Last but not least, you need to give away back at least 5%. By giving money is actually how you earn more. If you have difficulties in earning money, why not try to give money first? Like Rich Dad said, if you want a smile, smile at others people first and you'll receive more smiles. If you want a punch, go and punch other people and sooner will receive a punch. (Of course not the same people will punch you, as kids will ask their parents to punch you back!) (If you are mu

PAY YOURSELF FIRST! - It is important to pay yourself first. Why? If you pay other people first, then only yourself you are focusing on other people! Following the law of attraction, if you are focusing on other people, then you will more often pay other people. Concentrate on yourself first. But how if after paying myself, I still got unpaid bills? Just pay whatever you can. TNB wont cut your bills if you pay them 20% at least to show your commitment.