there are only 3 types of income

1 earned income

trade your time & labour for money (fixed)

dont work? no money

not passive income, but have no shame

it aint much, but its honest work

2 entreprenial income

trade your time & labour for money (variable)

dont work? if you built a good business, could be possible to eventually be passive

people think that this sort of income is passive, but i think you actually work more hours

the main trade off vs employee mode is trading away fixed office hours, capped upside and no immediate downside for 24/7 working hours, uncapped upside, but also very real risks of capital losses

influencers and content creators are in this category

 

3 investment income

risk your capital for more money (there are fixed and variable returns)  

truly passive to a large extent

requires small amount of thinking energy to manage investments

unfortunately, requires capital

as they say, no money no honey

i recently spoke to someone about making money

i think this persons impression of wealth generation is actually quite common for most poor people

 

person gave me advice to go buy businesses and operate them

"that is how all the rich people do it, they own businesses" 

i dont think this person understand that most businesses are shitty businesses and anyone that wants to sell their business, is probably operating a shitty business

rare situations of force majeure may present good buying opportunity, but that is luck, not skill

i say that i already own businesses, through stocks

the person said that's not the same. no storefront to visit, no employees to boss around.

i say, isnt it good to not to have employees?

isnt it good that i dont need to worry about the daily operations of the businesses at each location?

the person said if i owned the businesses, i can hire compentent management and not do anything and earn all the profit

i say, i already do nothing and earn a lot of profit :)

if it is so easy to make money like that, why don't everybody do that?

i think most people dont realize how hard it is to run a profitable business.

open business very easy. go register company on ACRA can already

open business that makes money? if so easy, everyone would be running their own business

open business that makes money and no need any effort? if so easy, everyone would be rich and FIRE already

if you know so much about businesses and making money, you must be very rich right?

follow the 50/30/20 rule if you are stupid and want to stay poor

watched a sinkie influenza talk about the 50/30/20 rule

50% spend on needs

30% spend on wants

20% for savings

i tell you up front that this is stupid

only low IQ people should follow this rule, because it is too simple that it does not help 

the correct way to budget is this:

1 spend what you need on needs

2 spend the minimum amount required for yourself to be happy

3 the remainder goes into savings and then investments

there is no ratio

you just overflow into the next bucket

if you earn less than average, you maybe need to spend 70% on needs

if you earn more than average, you maybe need to spend 20% on needs

expenses don't track earnings, unless you are a lifestyle inflation loser

you earn 50% more this month, you spend 50% more on wants? are you a child?

you earn 50% less than month, you reduce you rent/mortgage and day to day expenses by 50%? lol

this is a stupid rule of thumb and it helps nobody while giving misinformation

you spend on needs what you need to spend

you spend on wants in a reasonable manner

you dump all the rest into savings/investments

looking at myself as example

when i realized a lot of capital gains (coz GLK is not a high income worker), how did i allocate it?

5% to needs

15% to wants

80% reinvest

you should not invest anything until your emergency fund is full

only after that, do you "overflow" into investing

this is not difficult or complicated at all

here is my overflow order

shelter

food

utilities

transportation

TERM insurance

emergency fund

enough "wants" so you can continue living life happily

investing

"wants" that are ridiculous, but you no longer worry about money

i consider emergency fund a need, so i fill first before wants

ppl have problems is because they suka suka misclassify WANTS as NEEDS

you NEED to drive a car in singapore?

you NEED to have an annual trip to japan?

you NEED to fly business class?
you NEED to own luxury brands?

lol okay

dont let a internet loser like me tell you that you are WRONG, THOSE ARE WANTS, NOT NEEDS

in that case, maybe one of the reason why i am more financially successful than you is because i am a low-needs person that could overflow a lot into investments and have that larger capital base to snowball for longer

you live your own life

at the end of the day happy, can already

but ill warn you, it is not easy to be happy if money no enough

also dont think that low-needs = making sacrifices / being unhappy

i am a very happy person with a very happy life

just being happy is the real thing that makes sour people jealous

the unsustainability of chocolate finance

i dont know why sinkie finfluenzas are even giving chocolate finance the time of day

they are offering a rate higher than what its components can achieve

this is a clear money losing business, so why even support?

make hay while the sun still shines?

earn 70bps pick up on 1st 20k ( = $140) to participate in an actual ponzi scheme?

you guys are fucking retarded

this is beyond stupid

i am avoiding