One Degree

If you walk 1 km a day, deviating 1° from your original destination, how far would you be from your original destination in 1 year if you keep on that course?

It seems like a math question for high school students and you may forget how to calculate it or you just can’t be bothered to calculate the distance. If I ask you to guess the answer roughly, which one would you choose?

• A 1 km
• B 6 km
• C 30 km
• D 72 km

If you choose B, 6km, you are right.

Now, next question…

If you save $1 a day for a year and you invest it monthly with a return of 12% a year for 30 years, approximately how much money would you have at the end of 30 years? Have a rough guess.

• A $10,000
• B $30,000
• C $60,000
• D $100,000

If you choose D, $100,000, you are right! What if you save $10 instead of $1?

You can be a millionaire just by saving $10 a day!

 

1° may not be much, but over time, it can make quite a big difference.

$1 a day may not be much, but over time, it can make a big difference.

If you want your financial life to get better, just make one small change today. A small change that you do today, over time, can make a big difference in you life.

What 1° change are you going to do today? Please share in the comment.

 

Learn and Grow!

Inge Santoso, B. Com, CFP^®

Mind Before Matter

Train the mind and the matter will follow.

We’ve heard a lot of stories about people winning lottery and ended up with nothing after a few short years. Why? Because the mind is not ready!

A lot of people make the mistake of chasing the matter, such as money and possessions, but they forget to train the mind, building it with knowledge, understanding and wisdom. Thus even when they get the matter, they won’t be able to master it, and end up losing it.

It is important to keep learning. There are so many financial products that can help you to achieve your financial goals. You can’t afford to be ignorant. In finance, ignorance is NOT bliss, but a road to anguish and suffering.

If you do not have the time to learn on your own, then you can ask the help of a financial planner that you can trust. But at the end, it is YOUR money. It is your responsibility to manage it well.

Some people make excuses saying that they only have a small amount of money and it is too troublesome to track and manage it. Well, if you do not manage the small amount that you already have, why do you think you are ready to manage a bigger amount of money?

Before investing your money into financial products that you are not familiar with, invest in yourself by learning and asking questions. Remember to gather information about the product, the return as well as the risk.

Invest in your mind, then and only then invest your money!

Learn and Grow!

Inge Santoso, B. Com, CFP^®

Helping Elderly Parents to Manage Their Finances

When I went to the bank this morning, I saw a lady in her 50s trying to withdraw some money from her mother’s saving account. Unfortunately she could not withdraw the money because the signature on the form did not match the signatures on her ID card and bank book. Her mother was sick and she was unable to come to the bank herself. Her ability to write had deteriorated considerably so she could not sign legibly anymore. She also lost her ATM card, so there was no other way she could withdraw the money from the bank.

The teller was quite helpful in explaining what could be done in this situation.

• If she had had an ATM card, it would have been easy because she could withdraw the money through ATM.
• If she still could come to the bank, she could sign the form in front of the teller and they could use the photo ID to ensure that she was the person
• If she could not come to the bank, then she could arrange to have a bank officer to come over to the house

I did not know what happened next, but there were lessons to be learned here.

We cannot avoid old age. It is important to be prepared before the time comes.

One option is to have a joint account with one of your children, so that he or she can help to manage the money if you are unable to do so.

• Choose the right child to have joint account with. Not all of your children can be trusted with your money nor willing to help you.
• The joint account should be solely used for your benefit, not to be mixed with your child’s money
• There should be some regular reporting to other siblings to avoid negative accusations or disputes in the future

Do you have any experience in this matter? If you do, please share in the comments.

Learn and Grow!

Inge Santoso, B. Com, CFP^®

One Minute Can Make a Big Difference

The parking ticket on the left: 2 hours 1 minute, on the right: 59 minutes

When I saw the parking ticket on the left, my mind was filled with thoughts such as:

I should have walked faster just now

I should not have gone to the toilet

I could have driven the car a bit faster to get to the locket

I wished the car in front of me paid for the parking just a bit faster

One extra minute costing Rp 3,000 and a lot of anguish!

 

When I got the parking ticket on the right, my mind was filled with thoughts such as:

I was so glad that I had walked faster and not stopping at any other stores

I was so glad I bought things quickly and efficiently

I was glad that we parked close to the door

One spare minute saved Rp 3,000 and a lot of gratitude!

Sometimes I wonder how one minute can create so much difference, so different feelings and reactions.

The amount of money involved here is the same, Rp 3,000 (USD 0.30), but we tend to be more concerned with the value instead of the amount. In the first instance, it was paying Rp 3,000 for 1 minute, instead of 60 minutes, and it felt so expensive. In the second instance, it was paying Rp 3,000 for 59 minutes, and it felt worthwhile.

Are you getting the best value for your money? What are you going to do in one minute to make a difference in your life?

Learn and Grow!

Inge Santoso, B. Com, CFP^®

If You Want to Get More, Add Value!

One man’s trash is another man’s treasure.

There are a lot of people in the recycling business the person in the picture, but not all of them do what he does. Yesterday I saw him sorting out what he had collected, big bottles, small bottles, cups, and so on.

For the bottle, he removed the label, then efficiently cutting the neck and the bottom. After that, cutting what’s left of the bottle from top to bottom, then wrap the plastic sheet together. For the plastic cup, he removed the lip of the cup and stacked them together.

The additional effort in sorting out, organizing adds value and he was getting more money by giving the extra effort.

What are you going to do today to add value? The money may not come straight away, but somewhere along the line, you will definitely get something in return!

Learn and Grow!

Inge Santoso, B. Com, CFP^®

Risk in Taking Action and Doing Nothing

Last year, I shared about cash management and investing in mutual funds with two people. One of them took action straight away. Within a week, she opened a new investment account and started investing in some mutual funds. The other one did nothing.

Six months passed… 

The first one who had taken action immediately got a return of more than 13% of total money invested. She invested in mutual fund using dollar-cost-averaging to simplify the process. She allocated a fixed amount of money and invested in mutual fund at a fixed date every month.

The one who did nothing only got a mere 0.1% return because he only put the money in savings account. Without him realizing it, his money was actually losing value because of inflation.

The two of them received the same lessons, the same advices, yet their action or inaction gave them vastly different results.

There is a risk in taking action or doing nothing. When you take action, you know you take a calculated risk. There is a risk of failure or loss in taking action, but there is also a possibility of success. When you do nothing, you may feel that you are not taking any risk, but when you do nothing, you have a risk of regret for not doing it. In finance, doing nothing will definitely cost you because you have time and inflation working against you.

Have you taken a calculated risk recently? How are you faring? Please share in the comments.

 

Learn and Grow!

Inge Santoso, B. Com, CFP^®

Grocery Shopping That Does Not Empty Your Wallet

The first or the last weekend of the month is when people often go for grocery shopping because they just receive their salary.

A few tips on doing grocery shopping that does not empty your wallet:

1. Do NOT go shopping just after you just receive your salary. When you feel that you have plenty of money in the bank, you tend to buy things that you want instead of what you need.

2. Take stock of what you already have at home so you know exactly what you have at home and create a grocery shopping list. Remember to bring the shopping list with you and buy only what’s on the list.

3. Limit the time you are inside the grocery store. Just shop for what’s in your shopping list and go straight to the cashier. Do not walk through all the aisles, do your walking exercise somewhere else.

4. Go shopping after you have eaten. Do not go shopping on empty stomach because you tend to buy more when you are feeling hungry. Those Doritos, chocolate cookies and cashew nuts are really inviting, aren’t they?

5. Cheaper products are often found above or below the eye-level shelves. Look up or look down to find similar products with cheaper prices.

6. Leave your children at home when you are doing grocery shopping because they often ask you to buy things not on your shopping list. You know sometimes you just can’t refuse them, especially when they see you with their cute, pleading eyes.

Is there anything else you may want to add to the list? Please share in the comments.

Learn and Grow,

Inge Santoso, B. Com, CFP^®

Gamify Chore with Treasure Hunt

I have three helpers cleaning my house every single day. I understand that it is a chore to do this day in and day out, so today I want to spice things up a little bit. I created a treasure hunt!

I got 10 pieces of Rp 2,000 bills and I put each piece at hard to reach places or where they seldom clean. For example, behind the sofa and night stand, above the pantry cupboard and rain shower head, under the vase and cable box.

I told them to find all the 10 pieces of money and if they found all of them, I would give them additional Rp 10,000 as a bonus.

They were really excited to do the job today. They searched and cleaned every crook and cranny to find the money. It took them some time to find all the pieces but they were really enjoying their work. I could see them smiling and laughing whenever they found a piece! The three of them were working together, reminding each other to search places where the money could have been hidden.

Did they manage to find them all? Yes, they did! They got a total of Rp 30,000 today! They were really happy! Not only for the money but for the fun too!

I was also very happy because I got the house to be extra clean today. I also had some fun watching them doing the treasure hunt.

Let’s gamify chore!

What other ideas do you have to gamify chores? Please share in the comments.

Inge Santoso, B. Com, CFP^®

Written Notes vs Memory

Today I went to the bank to redeem one of the mutual funds. I intended to redeem Mandiri Investa Pasar Uang, but when I filled out the form, somehow I wrote Mandiri Investa Dana Utama. I only realized the mistake when I got home to input the transaction in my computer. Although the mistake was not fatal this time, it could have been a disaster.

Lessons:

1. Write your plan on paper instead of relying solely on your memory
2. Bring the latest statement to the bank to help you fill out the detail on the form
3. Concentrate when writing the form
4. Re-read what you have written and compare it with your notes or statement

Have you ever made a mistake similar to this? Please share your story in the comments.

 

Learn and Grow,

Inge Santoso, B. Com, CFP®

In Crisis, We Learn Our True Nature

My Nissan Juke after an accident this afternoon.

At 4.20PM I left the office to go to Vihara Dhamma Sundara for an interfaith tree planting ceremony. While I was waiting for the light to go green next to Centre Point, Purwosari, there were two motorcycles colliding with each other next to my car. I saw the collision and it seemed to be in slow motion until one of the motorcycles fell to left hitting the right side of my car. I did not dare to move because I might drag the motorcycle and injure the rider. I waited until people came out to help the two riders and told me to move to the side of the road.

After I parked on the side of the road, I went out to check the damage. I saw black streak on my right doors. One of the security guard that helped the rider came up to see the damage too. The black streak was just paint from the motorcycle and my car was not scratched nor dented. I sighed with relief.

The security guard asked me whether I wanted to pursue the case with the motorcycle riders. I told him that I wanted to get their details because I might need it for insurance. He persuaded me not to pursue the case, but I said I needed to do it.

I walked with the security guard to meet one of the riders, he was not injured physically, however his motor did have some damage. He was cooperative when I asked him about his detail and phone number. I told him that I might not pursue this matter because there was only superficial damage. 

The rider whose motorcycle fell on my car ran away. Perhaps he was afraid and he chose to run away, instead of taking responsibility for his action.

How did I feel? After the initial little shock, I was a bit worried about extent of damage to the car. After I saw that there was no real damage, I felt relief. Even if there was a real damage, the insurance would have covered it.

It was after I went back into the car and continued driving that I realized that I did not even ask whether the motorcycle rider was hurt from the accident. It did not even cross my mind to ask for his well- being. Suddenly I realized how I had put things above people. It was all business for me…no financial loss…no worries. I discovered something about myself today. I thought I had enough compassion towards people but when the real thing happened, it was evident that I did not really have it.

Lesson:

In crisis, we learn our true nature.

Anything that happens in our life can help us discover an aspect within ourselves. Either we like it or not, the simple acknowledgement that we have it inside of us hopefully helps us to learn, grow and be better human beings.

Learn and Grow

Inge Santoso, B. Com, CFP

The Right Not to Buy

One of my nephew’s sitters went to a baby shop to buy some milk. While she was in the store, she saw a butterfly pin. She thought that it was cheap for Rp4,500 (USD0.5) so she brought it to the cashier. When the cashier scanned the barcode, it was not Rp4,500 but Rp14,500, more than three times the price! She was feeling embarrassed to say no and she decided to pay for the pin.

If this happened to you, what would you have done?

1. Pay for it, or
2. Cancel the purchase

What if the price is Rp45,000 and Rp145,000?

Perhaps it’s easier to cancel the purchase when the amount is significantly bigger. Rp10,000 is cheap to save your face, but Rp100,000? Is it worth it?

I remembered my own story when I was a teenager studying in Australia. National Geographic store recently opened and I went there to check it out. I saw a stethoscope and I was considering of buying it. The price of the stethoscope was quite expensive considering the amount of pocket money I had. While I was thinking whether to buy it, taking it out of the box to see whether it was of good quality and the price did reflect the value, one of the store attendant came to me. I thought perhaps I was not allowed to take it out of the box, so he came to warn me. When he came, he asked me with what I heard was a demeaning tone, “Are you going to buy it? Can you afford to buy it?” At that moment, my ego went nuts. I thought nobody should look down on me like that, so with emotions running high, I told him, “Yes, I will buy it.” I went to the cashier and took almost all the money that I had in my wallet to pay for it. After I went home, I had a big buyer’s remorse!

At that moment I learned a lesson, to be unafraid to cancel a purchase and that I have the right not to buy and I won’t let the store attendant to “bully” me into buying something.  

Have you had a similar experience? What have you learned? Please share in the comments.

Learn and Grow!

The Science of Kamma–Dr Wong Yin Onn

This is my note on the Dhammatalk by Dr. Wong Yin Onn on 2nd December 2012.

What did I learn from this Dhammatalk?

The concept of Kamma

 

In understanding Kamma, it is important to understand that there is a difference between Kamma and Vipaka. Kamma is the cause while Vipaka is the effect. We often use the word 'Kamma' loosely to mean 'fate' but it is not so. Kamma is the intention while what is happening now is the Vipaka or the effect, result or fruition of what we had intended in the past.

“If one speaks or acts with a wicked mind, pain follows one as the wheel, the off of the draught-ox” - Dhammapada Verse 1

The main cause of Kamma is in the mind. When the mind is unguarded, bodily action, speech and thought are all unguarded. When the mind is guarded, bodily action, speech and thought are all guarded.

We should remember that Kammic causality is different from physical causality studied in physics. Kammic causality is much more subtle and may not be seen immediately.

Kamma is always changing and it is so complicated until only a Buddha can completely understand it. Not even other arahants can understand the working of Kamma and how each intention, action and time intertwine to produce the result. Because it is always changing, therefore we can change our lives, our destiny.

Kamma is not fate, Kamma is the opposite of fate! Since Kamma is an intentional action, the Buddha put the emphasis on the power of free will in shaping our future.

Kamma is about tendencies and not inevitable and unchangeable consequences. We have to remember that :

• NOT everything happens by Kamma
• Kamma vipaka (results of kamma) in an unconjecturable subject
• Kamma is not deterministic, thus it can be modified or transformed

There are five orders of law -

1. physical order,
2. genetic order,
3. order of action and result,
4. order of the norm
5. order of mind or psychological causation.

Not everything that happened is due to Kamma. The Law of Kamma is only one of the 24 causal conditions (paccaya) described in Buddhist philosophy.

An example of physical order was the tsunami that happened and killed so many people in Aceh, etc. It was not caused by kamma but more by physical order that the earth moved. Because the earth is moving, therefore there will be earth movement causing earthquakes, tsunami. Although our kamma might make us live there, but the incident was not solely caused by kamma.

An example of genetic order was genetic diseases in family such as diabetes or cancer. Because we were born with the genes, then we were predisposed with tendencies to get that particular disease and not solely caused by kamma because we can take action to avoid sugar or live a healthier lifestyle to avoid getting the disease.

Buddhism teaches Natural Causation that each time we intentionally do something, we modify our consciousness, so the person we are now is very much what we have done in the immediate and distant past; what we do NOW will make the person we will be in the future. What we do every moment changes the future.

There are four kinds of Kamma: (kukkuravatika sutta)

1. There is dark kamma with dark ripening
2. There is bright kamma with bright ripening
3. There is dark-and-bright kamma with dark-and-bright ripening
4. There is kamma that is not dark nor bright with neither-dark-nor-bright ripening that conduces to the exhaustion of kamma.

Since we are not awakened yet, what we often do is a mixed of dark and bright kamma. For example, when we give kathina dana, although it is a good kamma, yet sometimes inside we do it out of greed to get something in return.

The cessation of kamma – the path of practice leading to the cessation of kamma is the noble eightfold path: right view, right resolve, right speech, right action, right livelihood, right effort, right mindfulness and right concentration.

The strength of the kammic effect depends on its magnitude on the receiving party. The more severe, the greater the impact, whether positive or negative. The spiritual quality of the receiving party is also an important factor. For example, offering to a beggar is different from offering food to a Monk.

The Kammic strength is affected by kammic frequency. When a certain act is repeated frequently creating a habit, it can result in a major effect. The stronger the kamma, the higher its probability of creating an effect first.

Kamma is accumulative; good kamma leads to good conditions, bad kamma leads to unfavorable states.

Enlightenment leads to the END of kamma. We seldom think about ending kamma. We tend to rely on it instead of trying to end it. It is important to remember that we must aim to be liberated from kamma and not carry the burden of kamma anymore. Nibbana is freedom from kamma and its results.

Ending the Dhammatalk…

Thro’ many a birth in Samsara wandered I,
Seeking but not finding, the builder of this house.
Sorrowful is repeated birth.
O House-builder! you are seen.
You shall build no house again.
All your rafters are broken,
your ridge-pole is shattered.
To dissolution (Nibbana) goes my mind.
The End of Craving have I attained.
- Dhammapada (154)

May all beings be happy!

Inge Santoso, B. Com, CFP