Monthly archive - June 2015

The grass isn’t always greener

Posted on Jun 28, 2015 in Articles by 0 Comments

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My family was one of the wealthiest in Singapore, but that doesn’t mean our lives are perfect. The grass isn’t greener on the other side.
 – Gerald Tay

The problem with eye-balling other people’s stuff is it means you take your own eye off the ball.

Human nature means we’re inherently thinking other people have got it easier, better and anything else – er than us. Frankly, whatever we’ve got it, it always seems like someone else has got more. And we get jealous. We want more; more of what they’ve got – and a little bit extra for good measure. And yet, when we get more, we will always find someone else who has something more – something that outshines and surpasses what we thought we wanted and would be happy with.

The grass always looks greener on the other side. This side of the fence, that is your side of the fence, is never as lustrous, or as glossy as the other side. The other side always seem to have more. And you’re always left wanting and yearning for that something extra.

Rich – A skewed perception of what it actually means

Posted on Jun 21, 2015 in Articles by 0 Comments

It is sometimes hard for me to relate to other people’s situations because of the “unconventional” life I live.

It’s also probably hard for many of you to relate to my situation for this very reason—although I still hope you can at least learn whatever you can, especially considering I was once where you were (probably worse off, in fact).

Either way, I can only speak from my own experiences… and my life is one of autonomy.

It’s not often I have to do something I don’t want to do. I’m extremely fortunate in this way because of my circumstances. (although I’ve worked hard to make it so).

I set my own schedule for work, play and sleep. I travel when I want to, read when I want to, watch a movie when I want to, and do absolutely nothing when I want to.

I’m not rich as in Ultra High Net-worth (UHNWs) rich… not even close. You could say I’m “time rich” or “freedom rich.” Whatever.

Of course, getting to the point of being “time rich” took a lot of time and mountains of hard work – And very importantly the courageous mindset to rebel against society’s expected norms.

When you start a business, especially a brick and mortar one, you become responsible for employees, taxes, inventory, ordering, selling, marketing, customer support, and everything else that a small business takes to run (which is a lot).

Even though you are the “owner” or “boss,” you end up becoming more like an employee to the million little details in your business. In time, if you are smart and work hard, you can build a team to handle these tasks for you. But even then, you need time to manage your team, set goals and actions to make sure they accomplish what you intended.  In short, until you build your small business into a giant conglomerate, you are forever stuck as an employee of your business – Your business cannot run without your presence and just like the ordinary wage employee, your income and whatever life indulgences stops.

The belief that any successful business equals wealth, freedom and success is a fallacy. Many small but successful businessmen (Think SMEs) are more slaves to their business than the other way round. They know but seldom admit publicly.

This is when I chose to become an “Investor.”

That’s where I am at now in my investment career: Owner/Investor instead of Owner/Operator.

This allows me to be free in my schedule and do what I want to do everyday, without obligations to anyone.

Of course, there are times when I miss the restriction of having a fixed schedule. Sometimes “doing whatever you want” isn’t the easiest thing to manage. (I know, I can see those of you with a job shaking your head.)

Now, with all that said, there is something that those of you with a job have going for you that I don’t get to enjoy.

It’s this: You get to clock out!

I never get to clock out.  I’m 24/7 thinking about “work” and “life” in some way. Unfortunately, I don’t know how to turn this off. Being able to clock out is a huge benefit to having a job that most of you are not taking advantage of.

One may think having a life of “time” rich or ‘freedom” rich is great and an aspiration everyone seeks.

It’s not if you look deeper. 

Let me explain.

Many of you have a relative fixed daily schedule – Wake up in the morning, send your kids to school, go to work, break for lunch, break for tea, knock off from work, go home, have dinner, play with kids, do some work, and finally go to bed. In your job, you have work to be fulfilled either demanded from bosses or regulated to you because of obligations. The schedule repeats tomorrow. On weekends, you get a break and enjoy without having to think about work or see your boss’s face. Everything like having a fixed secure monthly income is spoon fed to you. All you need to worry is fight off the 5-day slavery (and your nasty bosses’ demands) and enjoy the remainder 2 days of weekends plus public holidays and work leave not worrying about anything else. These are certainties especially with a guaranteed monthly paycheck (as long as you don’t get retrenched).

Like I said, I never get to “clock out.” I have to be careful with what I research, invest, read, and think about because my mind is always full. It’s a pain to deal with and wrangle under control. I have to be the boss and the employee in the business of me. I face the “boss” everyday and every hour.

It’s a life I choose. A life I’ve learned to accept to gain “time” rich or ‘freedom” rich. I count myself blessed to lead such a life many crave for.

But everything in life has a price tag – like a pact with the devil. 

Even “freedom”.

This wise man observed that wealth is a tool of freedom. But the pursuit of wealth is the way to slavery.

From past experiences coming from my personal childhood days, one of the things I guard against is covetousness. There’s a biblical saying, “We trade in the currency of Mammon – of Money”. Which is a pagan god.

Instead, we must trade in the currency of love and satisfaction.

Therefore, I tell you not to worry about your life, what you eat or drink; about your body, what you will wear; about your car, what brand you drive; about your house, what type and size you stay in. Is life not more important than food and the body more important than clothes? Is life not more important than car and a “cage in the sky”? Is family not more important than a pretentious lifestyle? Who are you by worrying can add a single hour to his life?

And why do you worry about the material things in life? Look at the birds in the air; they do not sow or reap or store away in barns, and yet they survive. Are you not much more valuable than they? Look at war-torn Somalia and recent earthquake-devastated Nepal. Are you not much more fortunate in your lives than the people in these countries? Therefore do not worry about tomorrow, for tomorrow will worry about itself. Each day has enough trouble of its own.

The last time I looked, I think my investments is secure. But who can tell? And all investments and businesses have debt. I do not have personal debt, but I have corporate debts. While I think my investments are safe, I have my share of worries.

I’m a career investor. My investments dictates my net worth. My livelihood depends greatly on making sensible investment decisions. And this is the crux of the “pain” I have to deal with everyday. I’ll be “time” rich or ‘freedom” rich as long as my investments do well. I do not have to contend with building or owning treasures on earth where moth and rust do destroy. If you have much, you will worry because you do not know what can happen; markets go awry, property, stock and shares can change suddenly.

So you see the wisdom of storing treasures in our hearts and in our loved ones, instead of owning them physically just to show to the world you have ‘arrived”. Our compact material society reeks plenty of pretentious wealth when there is nothing to show for underneath appearances.

Situations are the same – There’ll always be problems and worries; regardless if you are rich or poor. We continue to be face with problems and are vulnerable to temptations.

Financial Freedom or mistaken belief as “Rich” (it’s different) – is a  skewed perception of what it actually means. Many schools of thoughts from financial advisors to wealth gurus professed to know its intense depth. They don’t know and are clueless themselves. The little knowledge they have is misguided information derive from outside sources.

A situation where no one believes, but everyone believes that everyone else believes. They hear from someone else, cut and copy, edit to suit personal agenda, reiterate to the masses, and they claim it as non-fiction.

The inner lives of the real Rich is skewed from what is painted in the media as propaganda to ignorant consumers.

I know – because I was born into riches. You may think my wealthy birthright is blessed and fortunate. I tell you without compunction, I wished my early life had been more ordinary.  My personal association with the real Rich goes beyond what is portrayed by the media, what one reads from books or heard from wealth preachers.

This post is sort of “prequel” to my future posts on “Wealth and it’s Dangers”.  I’ll share deep insights of the inner lives of the real Rich in the hope of enlightening readers and people who hopes to become “Rich”.

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To your investment success,

Gerald Tay


An Interview by The Peak magazine about buying a second leisure apartment as an investment

Posted on Jun 13, 2015 in Articles by 0 Comments


DOMAIN, under The Peak magazine did an e-mail interview with me some time ago. The writer has asked a few good questions and published my reply in their magazine.

Here’s a quick note on The Peak magazine: – The magazine’s primary readers are HNWs and Ultra HNWs (High Net-Worth Individuals). They are very rich businessmen, CEOs of MNCs and the occasional rich socialites. Their investment strategies is completely different from the masses due to their “unlimited resources” and high society connections – It may not be wise to attempt to replicate their investment strategies if you’re an ordinary buyer or investor.

Here’s the re-post.

Interview Questions: – 

Hi Gerald,

I’m a freelance writer, and am writing a feature article on investing in leisure apartments for DOMAIN, under The Peak magazine. I have some questions I hope you can help out with.

-What makes buying a second leisure apartment a good investment?

-How about the risks involved? What should one consider before taking the plunge?

-Would you agree that some considerations might include a)Financial feasibility, b)Tax implications, c)Current market situation, d)Housing rules, e)Rental rates, f)Debt to Net Worth ratio? Please comment and elaborate on each of these, or any other factors you might think of?

-What kind of rental yield should one ideally aim for?

-Any other tips for a homeowner on how to make their second property work harder for them?

My Reply: – 

These are my answers from more than 14 years of real estate investment experience. I’m not a sales person or someone writing to sell some properties. I understand you’re speaking to other investment/experts too. I’m not sure what background they are from, so you’ve to be very careful if they are coming from a sales point of view or giving real advice.

My answers are based on experience and real investing experience from myself and other real investors.

I understand your audience have different investment objectives and of course, different size of ‘investment resources’.

I come from similar wealth backgrounds in the past so I’ve deep insights into how these HNW (High Net-Worth) and the ultra HNW think when buying real estate.

-What makes buying a second leisure apartment a good investment?

The question should be re-phrased as “Why is it not a good investment?”

1. Leisure apartment or overseas vacation homes are more of an exotic nature (entertainment) than a real investment.

In good times, they may do well (then again, any other types of properties also do well in good times). But in bad times, and especially bad times, they would be one of the first ‘assets’ investors dump, beside stocks and shares, due to its nature. (unlike buying a home for stay).

2. It’s a very high risk type of real estate investment, and the returns are never justifiable.

The rich would have done better putting their money in their business or elsewhere, than in an exotic investment like a vacation home. Then, again, if it’s simply money for ‘show-off’, entertainment, etc, it’s a different story altogether.

if these overseas properties were that good, the local investors would have snapped them up for themselves – but they don’t and there’s always a good reason why. If you observe, many of such properties are heavily marketed overseas to foreign investors who are more ignorant than smart.

Personally, I don’t and will never invest in such ‘gimmicks”, often a propaganda by the developers, fanciful marketing, property agents, profit interests.

-How about the risks involved? What should one consider before taking the plunge?

1. Over-building in the location. Developers of such properties would see a sudden surge of tourists or economic growth, and they will decide that’s where they can make money selling to foreign investors. So they start building, and soon you have a location full of these vacation homes. Laws of demand and supply comes in.

2. Most important – It’s overseas and therefore a very ‘alien’ territory to most people. How much does the investor understand about the location, politics, economy, history, tax implications, current market, housing rules, etc….too much uncertainty for too little profits if any.

3. Risks of listening to sales advice, rather than real advice. Example, your property can be managed easily by property managers which can be disastrous sales advice. True fact is, most property managers makes money, working with the relevant contractors, by hiking up repair costs, maintenance costs, and billed it to their unwary foreign clients – without them them knowing the real costs.

-Would you agree that some considerations might include a)Financial feasibility, b)Tax implications, c)Current market situation, d)Housing rules, e)Rental rates, f)Debt to Net Worth ratio? Please comment and elaborate on each of these, or any other factors you might think of?

Yes, of course as in above answers. My advice, if anyone wants to invest in such overseas properties, find a credible and trust worthy local partner of that country and do it together. The local partner must be someone who has done such investments many times, and therefore very familiar with the ‘terrain’, ‘weather’, rules, business landscape, etc.

-What kind of rental yield should one ideally aim for?

As for the high risks involved, one should be looking at very high yields to compensate for the huge risks involved. 50% ROI per annum? This may sound outrageous, but the ‘premium loading’ is to compensate those risks. I would ask for that. If I run a start-up business, my asking ROI is 100 to 200 or even 300% of my costs due to the high risk nature of starting businesses.

Then, is it even possible to get those kind of returns? Of course not. No developers would offer any kind of such returns to retail investors. So, it means, don’t invest at all.

But, if the rich has plenty of money to burn, ‘hide’, stash money away to prevent taxation from their own govt. , then go ahead.

As I always like to repeat, overseas vacation homes are no more than exotic investments, like art collection or wine.

-Any other tips for a homeowner on how to make their second property work harder for them?

The rich would have their successful businesses working hard for them already. They don’t need a 2nd property or a 3rd property like a vacation home hoping to make more money. Unless you are talking about the middle-class – people who still need to work to earn their living. (your audience here may or may not be in this category)

When the Rich (HNW/Ultra HNW) invest in property, they do so for a few reasons:
1. Pass down the generations.

They stash their money away to prevent taxation. Many rich Asian buyers typically will want to leave something for their next generation. It’s in the culture.

2. Hedge against inflation.

They just need to make little ROI, as long as their money is protected against inflation. This is their primary objective and these people can afford to hold for a very long time. So for example, if the ROI is 4% and inflation is 4% over the years, they are fine with breaking even. They don’t have to make plenty of money in property since their successful business is already doing that for their wealth. If they do make, it’s only bonus for them. If they lose, well, it does not hurt them either.

So this is how the very rich buyers think – “If I lose some money in real estate, but the money lost is lesser than what I have to pay in taxes or prevent confiscation of my undeclared wealth from the government, then I’m still profitable.”

3. For wannabes, fun, entertainment, exotic purpose, show-offs, another collection to add to their artsy collection, etc.

Exotic properties like vacation homes and leisure apartments are lifestyle investments, not a wealth builder. They are like wine and art and are nothing more than “toy collections” for the rich.

As for the typical homeowner who earns a high income (not rich), they would have done better investing in bread-and-butter properties that are simple to understand and in their home countries. Examples: cash flow residential properties or older resale properties, etc.

Click Here To Find Out How You Can Harness Your Intentions And Turn Them Into Reality

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To your investment success,

Gerald Tay


Email from Reader – Is Property dismal as an Investment Tool?

Posted on Jun 6, 2015 in Articles, Investment Strategy by 2 Comments

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Email from Reader:

Hi Gerald!

I am a subscriber of your blog and often read your contributions there! Frankly, you strike fear in my heart as a property agent when you share your views on how dismal is the property market as an investment tool. I genuinely want to advise my clients correctly what is the best way to utilise their funds in a property as an investment.

May i ask- if you find property as such a poor choice for investment, what would you suggest otherwise? Putting your hardearned cash in the banks and to have it eroded by inflation is surely a poor alternative and one that likely that even lax investors would try to avoid. Would appreciate your sharing of insight. Hope to hear from you soon! Much thanks!