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04-12-2011, 06:58 AM
The Straits Times
Dec 4, 2011
Not ready for credit
Credit cards make you buy things you wouldn't but it's hard to resist them in this material world
By Rachel Chang
One of the most painful meetings I've had in the last few years was with a financial planner.
I took the lunch because he was a friend of a friend. But we had barely covered the small-talk bases before he was brandishing a white booklet in which he wanted to put down my spending habits, my saving goals and my investment strategies.
He kept asking me these questions: How much did I want to save each month? How much did I think I would need for retirement? What assets did I have and which did I want to have?
I didn't have any well thought-out answers, and when my brain ventured down the paths he was leading me, it hurt.
An inchoate suspicion plagued me throughout the lunch. The more questions of these sort were asked of me, and the more I asked them of myself, the more trouble there would be.
After two years of managing my own money - and of having a front-row seat to the theatre of psychosis that is the upper- middle class's obsession with financial planning - this suspicion has grown into conviction.
As Biggie Smalls (Rest In Peace) would say: 'Mo' money, mo' problems.'
Sure, we could talk about how all these fancy financial instruments from the credit card to the unit trust to the collateralised debt obligation are just ways of charging you money to push your money around.
We could talk about debt, and the collective amnesia we've had about the fact that it is inherently nonsensical to spend what you don't have, and how the global economy is still on the brink of collapse because of it.
But the Reflect column is no place for such pointless navel-gazing. Today, my ire is aimed at all the little people who believe that mastery over the 12 credit cards in their wallets constitutes some sort of life achievement.
Once, someone told me that whenever he has lunch with his colleagues, his boss pays with his credit card.
But when I said, 'oh, that's so generous', he gave me a get-with-the-times look and clarified that after lunch, the boss' secretary goes around collecting everyone's share in cash.
'He pays with his credit card for the points,' I was told witheringly. This was brandished as evidence of the kind of visionary thinking that propelled this man to a position of leadership.
I feel like a civilised man among barbarians.
The same bewilderment strikes me whenever someone excitedly announced that she just needs xx more points to claim xx airline miles before she gets a free flight to Bangkok.
Or when someone tells me that she's applying for xx credit card because it has good discounts for dining, but has xx credit card because it has better discounts for spa treatments.
All I hear is the insane ramblings of people boasting about the fact that they have been made to spend more money in order to spend more money.
Perks and points and miles have become reasons to pay for things that you probably would not have if we still all kept our money in biscuit tins under the bed.
Mo' money, mo' problems.
When I started earning my own keep, I was determined to keep things simple. I would not go down the rabbit hole with these strivers. My wallet was fine with just an ez-link card, my IC and my debit card.
Those card slots would remain empty as a silent and personal protest against a world gone mad.
There would be one rule that I would keep as an adult, I decided. I would not spend money I did not have, and I would not spend money for the purpose of supposedly making money, when actually the money would be made by the people pushing my money around.
But the calls kept coming. From financial planners, from banks, from insurance agents. The meetings were painfully sat through, the demurrals were awkwardly delivered.
Until the day they decided that they would just go ahead and enrol me in the generation that Common Sense forgot anyway.
I was sent TWO credit cards, unsolicited, by the bank that I've had an account with since I was 12.
The same bank that made all those presentations to us little kiddies at school assembly about putting 20 cents into our piggy banks every day for a rainy day. The same bank that gave out cute little piggy banks when you opened an account, after practising your signature over and over at home before going to the bank with your mother.
The same bank that always maintained that it was the People's Bank.
To add insult to injury, they spelt my name wrongly.
Two credit cards now proudly stood at the command of a Rachel Cheng.
For a moment, I didn't know what to do. I felt a little bit violated, although technically it was not my financial free will that had been infringed, it was Rachel Cheng's.
I would just return them, I decided. And a few weeks later, I did. But with a request for them to send me a card with my actual name on it. You know what, I only kept that one credit card because my mother pointed out that it would be useful for travelling. That fruit juicer I redeemed with my points is purely incidental.
Two years after I crossed the financial Rubicon, all the card slots in my wallet are full. I even have an i-banking dongle and carry blank cheques around just in case.
In my feeble defence, I was forced to open all those other bank accounts because they were linked to my overseas bank accounts and my insurance payments and, blah blah, I'm not a sell-out, blah blah.
Some might say it's just growing up. I think of it as a condition of living in these cruel times. This is a battle I will stop fighting because I am saving my energy for bigger ones... such as my ongoing resistance to signing up for gym membership.
To hold on to my remaining shred of dignity, I refuse on principle to look through the 'Rewards!' booklet that they send to you with your credit-card bill.
The blatantly disingenuous and faux-classy title ('Rewards', really, when it involves Swensen's?) would be enough to get me to rip up the brochure.
More importantly, I will not be tempted into spending money that I wouldn't have spent if I didn't have this instrument of spending.
I still plan to withdraw all my money one day and put it into a biscuit tin under my bed. I would do it today if it weren't for, you know, inflation and all that.
Mo' money, mo' problems.
rchang@sph.com.sg
Dec 4, 2011
Not ready for credit
Credit cards make you buy things you wouldn't but it's hard to resist them in this material world
By Rachel Chang
One of the most painful meetings I've had in the last few years was with a financial planner.
I took the lunch because he was a friend of a friend. But we had barely covered the small-talk bases before he was brandishing a white booklet in which he wanted to put down my spending habits, my saving goals and my investment strategies.
He kept asking me these questions: How much did I want to save each month? How much did I think I would need for retirement? What assets did I have and which did I want to have?
I didn't have any well thought-out answers, and when my brain ventured down the paths he was leading me, it hurt.
An inchoate suspicion plagued me throughout the lunch. The more questions of these sort were asked of me, and the more I asked them of myself, the more trouble there would be.
After two years of managing my own money - and of having a front-row seat to the theatre of psychosis that is the upper- middle class's obsession with financial planning - this suspicion has grown into conviction.
As Biggie Smalls (Rest In Peace) would say: 'Mo' money, mo' problems.'
Sure, we could talk about how all these fancy financial instruments from the credit card to the unit trust to the collateralised debt obligation are just ways of charging you money to push your money around.
We could talk about debt, and the collective amnesia we've had about the fact that it is inherently nonsensical to spend what you don't have, and how the global economy is still on the brink of collapse because of it.
But the Reflect column is no place for such pointless navel-gazing. Today, my ire is aimed at all the little people who believe that mastery over the 12 credit cards in their wallets constitutes some sort of life achievement.
Once, someone told me that whenever he has lunch with his colleagues, his boss pays with his credit card.
But when I said, 'oh, that's so generous', he gave me a get-with-the-times look and clarified that after lunch, the boss' secretary goes around collecting everyone's share in cash.
'He pays with his credit card for the points,' I was told witheringly. This was brandished as evidence of the kind of visionary thinking that propelled this man to a position of leadership.
I feel like a civilised man among barbarians.
The same bewilderment strikes me whenever someone excitedly announced that she just needs xx more points to claim xx airline miles before she gets a free flight to Bangkok.
Or when someone tells me that she's applying for xx credit card because it has good discounts for dining, but has xx credit card because it has better discounts for spa treatments.
All I hear is the insane ramblings of people boasting about the fact that they have been made to spend more money in order to spend more money.
Perks and points and miles have become reasons to pay for things that you probably would not have if we still all kept our money in biscuit tins under the bed.
Mo' money, mo' problems.
When I started earning my own keep, I was determined to keep things simple. I would not go down the rabbit hole with these strivers. My wallet was fine with just an ez-link card, my IC and my debit card.
Those card slots would remain empty as a silent and personal protest against a world gone mad.
There would be one rule that I would keep as an adult, I decided. I would not spend money I did not have, and I would not spend money for the purpose of supposedly making money, when actually the money would be made by the people pushing my money around.
But the calls kept coming. From financial planners, from banks, from insurance agents. The meetings were painfully sat through, the demurrals were awkwardly delivered.
Until the day they decided that they would just go ahead and enrol me in the generation that Common Sense forgot anyway.
I was sent TWO credit cards, unsolicited, by the bank that I've had an account with since I was 12.
The same bank that made all those presentations to us little kiddies at school assembly about putting 20 cents into our piggy banks every day for a rainy day. The same bank that gave out cute little piggy banks when you opened an account, after practising your signature over and over at home before going to the bank with your mother.
The same bank that always maintained that it was the People's Bank.
To add insult to injury, they spelt my name wrongly.
Two credit cards now proudly stood at the command of a Rachel Cheng.
For a moment, I didn't know what to do. I felt a little bit violated, although technically it was not my financial free will that had been infringed, it was Rachel Cheng's.
I would just return them, I decided. And a few weeks later, I did. But with a request for them to send me a card with my actual name on it. You know what, I only kept that one credit card because my mother pointed out that it would be useful for travelling. That fruit juicer I redeemed with my points is purely incidental.
Two years after I crossed the financial Rubicon, all the card slots in my wallet are full. I even have an i-banking dongle and carry blank cheques around just in case.
In my feeble defence, I was forced to open all those other bank accounts because they were linked to my overseas bank accounts and my insurance payments and, blah blah, I'm not a sell-out, blah blah.
Some might say it's just growing up. I think of it as a condition of living in these cruel times. This is a battle I will stop fighting because I am saving my energy for bigger ones... such as my ongoing resistance to signing up for gym membership.
To hold on to my remaining shred of dignity, I refuse on principle to look through the 'Rewards!' booklet that they send to you with your credit-card bill.
The blatantly disingenuous and faux-classy title ('Rewards', really, when it involves Swensen's?) would be enough to get me to rip up the brochure.
More importantly, I will not be tempted into spending money that I wouldn't have spent if I didn't have this instrument of spending.
I still plan to withdraw all my money one day and put it into a biscuit tin under my bed. I would do it today if it weren't for, you know, inflation and all that.
Mo' money, mo' problems.
rchang@sph.com.sg
My Value Investing Blog: http://sgmusicwhiz.blogspot.com/
