Life can be unfair. Nonetheless, there’s a way to understand our world for what it is, grimy and imperfect, and yet remain uncontaminated by it.

Only a fool or a simpleton would say money is unimportant. To the vast majority of us who are neither especially foolish nor oblivious to the ways of the world, it is clear money is, shall we say, relevant to our lives.

Most of us grown-ups have had excessive idealism beaten out and bled from us by the ‘slings and arrows of outrageous fortune’, to borrow a line from Shakespeare's ‘Hamlet’. The net result is we find ourselves pragmatically focused on surviving, paying bills, and getting through yet another day with our bellies full and our honour intact.

The best way to do so is to treat money with respect but to NOT fall in love with it. One of the most quoted verses of biblical wisdom is this succinct line from the New Testament: “The love of money is the root of all evil.”

I mulled over that saying many times as I worked my way through all 379 pages of Tom Wright and Bradley Hope’s book Billion Dollar Whale. In last week’s column (Money Lessons from London), which you may access here at www.nst.com.my/authors/rajen-devadason , I explained that their book focuses on Malaysia and our 1MDB kleptocracy scandal. (If you don’t know this, a kleptocracy is a ‘government of thieves’.)

What I left out last week in my reference to their deeply researched book is that the ‘whale’ it refers to is not any of our politicians from the previous administration, despite the huge sums of money some of them amassed over decades of Malaysia’s single coalition rule, which ended on May 9-10 this year with GE14. Instead, the whale is the fugitive businessman Low Taek Jho, known globally as Jho Low (with both Jho and Low rhyming with ‘Joe’, or more appropriately ‘foe’).

Remember that name, particularly later this week when our new Pakatan Harapan government rolls out its maiden national budget. It has been made clear that it won’t be a normal juvenile ‘feel good’ budget aimed at buying votes for the incumbent administration, but rather a painful grown up one that calls on most Malaysians to make sacrifices today to salvage our country’s battered, tattered finances so our children have a shot at a better life instead of inheriting a failed state.

I expect a lot of anger, including some of my own, to be vented against the new government after the Budget speech. It’s likely our personal and collective rage will be misdirected.

So what I will then need to remind myself is that the mess Malaysia was, and still is in, was largely caused by outrageous fiscal (meaning budgetary) mismanagement over the last nine years. On a smaller scale, the financial stresses some of us find ourselves in are often caused by our personal cash flow mismanagement over our adult years.

FINANCIAL FREEDOM

So, if we end up needing to tighten our belts throughout 2019 because of higher taxes – hopefully just for the short-term – then we’ll need to work that much harder to elasticise our reduced discretionary income to pay our ever-present bills while also saving for a rainy day and investing for a sunnier one.

I recommend you buy (or borrow) a copy of Wright and Hope’s riveting book; then set a short-term goal to finish reading it before Budget 2019 is unveiled by Finance Minister Lim Guan Eng on November 2, 2018.

As I expect huge amounts of vitriol to be hurled at Lim once our sacrificial budget is revealed, I’ll leave you with an excerpted paragraph from the epilogue of Billion Dollar Whale:

“In our global financial system, where trillions of dollars move daily and huge institutional funds are looking for the next great investment, sovereign wealth funds can raise inordinate sums at the drop of a hat – in 1MDB’s case, even without a track record or a plausible business plan. Low’s genius was he sensed that the world’s largest banks, its auditors, and its lawyers would not throw up obstacles to his scheme if they smelled profits. It’s easy to sneer at Malaysia as a cesspool of graft, but that misses the point. None of this could have happened without the connivance of scores of senior executives in London, Geneva, New York, Los Angeles, Singapore, Hong Kong, Abu Dhabi, and elsewhere. Low straddled both these worlds – Malaysia and the West – and he knew exactly how to game the system.”

For little people like you and me, the best we can do is take an ice-cold, diamond-hard look at the world of money and yet opt to live clean, ethical lives of low financial stress.

The key, as I’ve written here many times before, is to make our money honestly (translation: Do NOT steal); to spend less than we earn; and to save and invest the difference for a long, long time. That prosaic route will never make us billionaires, but it can lead us to accumulate what we need for a happy retirement IF we start early enough and stay squarely on the slow, safe, straight and slim path to scrupulously secured financial freedom.

© 2018 Rajen Devadason

Rajen Devadason, CFP, is a Licensed Financial Planner, professional speaker and author. Read his free articles at www.FreeCoolArticles.com; he may be connected with on LinkedIn at https://www.linkedin.com/in/rajendevadason, or via rajen@RajenDevadason.com. You may follow him on Twitter @RajenDevadason

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