Credit Cards? No, thanks

Fed up with the financial woes that he got mired into because of his unchecked credit-card expenditure, Mr Ryan Soh decided to get rid of his six credit cards. Now, he uses only debit cards.

'That was about four years ago. I incurred a credit-card debt of $40,000 over a four-year period. I was careless with my expenditure and did not really look into the credit-card charges,' he said.

'So I have decided I do not need credit cards. Now, I have two debit cards. It is better to have money debited straight from my bank account. I now spend what I can afford.'

Having learnt how to manage his finances the hard way, Mr Soh, 30, now wants to help others. Last year, he set up a financial firm, Young Entrepreneurs' Secrets, with two friends. His personal investment in the firm was $150,000. They launched a MoneyTree programme which promises to inculcate money management skills in children and young adults, aged nine to 22.

So far, the MoneyTree programme has trained more than 2,000 youth via face-to-face coaching sessions, boot camps, workbooks and an e-learning portal.

Besides Singapore, the programme has been conducted in Malaysia and Hong Kong.

Being an entrepreneur is not something alien to Mr Soh. His father owns a construction firm and his mother ran her own optical shop for 23 years before becoming a housewife. He recalled helping out at her shop when he was just six. When he graduated from the Singapore Polytechnic with a diploma in mechanical engineering in 1998, he joined his father's firm as a project coordinator for a year before striking out on his own.

He is planning to marry Ms Jamie Siew, 30, a manager at a statutory board, in December.

Q: Why did you want to be an entrepreneur?

Having read widely on self-improvement books and exchanged views with many like-minded entrepreneurs, I have become a firm believer in multiple sources of income and I believe that earning a fixed pay cheque every month is never the only option. The challenge of running a business motivates me and hypes me up. This spirit is seldom found when you work for somebody.

Q: What are your money habits?

I used to be careless with my credit-card expenditure but I have since got rid of them and now use only debit cards. I spend only when necessary, with the occasional indulgence to 'reward' myself.

When I have a goal in mind, I focus on earning the money to get me what I want. This is a more proactive approach to getting on with life rather than

'living within one's means'. Of course, this is not to say that we should all be mercenary and pursue the finer things in life. Ultimately, we should be responsible in keeping a healthy financial balance. At least 10 per cent of my income goes into savings.

Q: What financial planning have you done for yourself?

My main focus now is on building my businesses. As I have a conservative risk appetite, I am now looking into investing in financial vehicles like real estate investment trusts (Reits) and unit trusts. I am in the process of comparing things like risk, return and time frame.

Q: What is your investment philosophy?

I believe the only person who has a genuine interest in building one's wealth is oneself. Therefore, I have second thoughts when bankers or consultants forecast promising returns and do not highlight the risks clearly to investors. At the end of the day, one has to be responsible and exercise due diligence on the wide array of sophisticated investment instruments before investing.

Q: Any other investments?

I started an Internet marketing business two years ago and it is generating a steady income of $1,000 to $2,000 a month. Early last year, I set up an information technology business, the main focus of which is to create corporate websites based on Web 2.0 technology. It is giving me annual returns of up to 20 per cent.

Q: Money-wise, what were your growing-up years like?

I come from a family of five and I am the middle child. When I was seven, my dad's construction business ran into some financial difficulties. We had to tighten our belts and we moved from our terrace house in Pasir Panjang to a rented three-room flat. Even our three meals got simpler. They consisted mainly of porridge and black soya sauce for two years. It was a big contrast to enjoying bird's nest soup when his business was doing well.

Dad's business managed to turn around when I was in my teens. It was a period I would never forget and the switch in lifestyle left a deep impression on me. Coupled with my credit-card woes later, I learnt that money can come and go without proper management and a right mindset.

Q: What has been a bad investment?

An investment made six years ago. It was a health-care business and I lost around $80,000 over four years because of running overheads and cash-flow problems. I learnt that having multiple sources of income is important, which is why I have started to develop small channels of business for income.

Q: Your best investment to date?

My current business, MoneyTree. MoneyTree is my flagship business, established to teach financial wisdom to kids and young adults. It was founded with two friends, Mr Low Chiu Hwa and Mr Jacky Chong.

We saw many kids with straight As, who became high-fliers, but ended up bankrupt. We want to make a point that keeping money is as important as earning it, and that positive habits have to be built from young.

It costs between $600 and $900 a person for either a two-day course or a weekly modular course for six months.

Q: What is your retirement plan?

To be financially free at the age of 40.