To The Moon

[Spending vs Assets]

Encountered this interesting concept of 1:100 and 1:1000 concept of spending versus assets. Meaning if you have $100k in Assets, you will spend $1k for a 1:100, and $100 for a 1:1000.

Rationally it can only make a certain level of sense if you are a high nett worth asset holder.

Cos if you have only $1000 worth of assets as a newbie, it would be inconceivable to spend only $10 or $1 in a period of time right? [Sly]  

Nonetheless I would like to use some other concepts for you to consider how you should spend.

Needs vs Wants

This is one of the earliest concepts that I based on initially. Do I need or want it? I will need to eat but certainly I need not eat a high end Michelin 3 star daily to fulfill my desires. I will want it but it will not make any sense.

Figuring out early what you need vs what you want is crucial especially in the early years of saving and investing.

Of course, it doesn't mean you can't spend on your wants. Occasionally I go $Starbucks(SBUX)$ to reward myself with a cuppa but usually all I need is a free caffeine shot from the company I work in. Price differential is $8~$9 per fix.

Too expensive vs How can I

The younger me will frequently state that this item is "too expensive" and thus avoid Buying something unaffordable.

After reading Rich Dad Poor Dad, the mentality shift is towards a Growth Mindset which sounds like "How can I buy 1 share of $Berkshire Hathaway(BRK.A)$ "? [Miser]  

One mindset is fixed while the other is growth orientated and seeks to expand your thoughts towards greater possibility.

Current vs Future value

Another method of expenditure is to look at the current vs future value. Example, if I were to spend $1 a day on coffee, vs $11 a day on expensive coffee, I would save $10 per day.

That would work out to $3650 savings per years. Amazing? No yet. If I can compound my wealth for 10% year on year and do so for 20 years, how much would I have saved?

It'll be a huge number! (6 figures in fact)

Active vs Passive income

One other perspective is how much am I spending vs my active income. That means my monthly take home salary. Ideally I would spend 50% and below and not more than 90% of my take home. Saving 10% is the bare minimum.

Another angle is how much am I spending vs my passive income. This would allow me to understand how much can I enjoy from the hard work of money. [Grin]  

How many plates of chicken rice?

Lastly, I will ask myself how many plates of chicken rice do I need to spend in that expense?

is it worth it? Now I love chicken rice. If buying that item cannot solve the problem of a similar amount of chicken rice, I may not get it. [LOL]  

What modes of thinking do you use to manage your expenses?

Like, share and repost. Keen to learn from you too! [Great]  

Meanwhile, here are some lovely food and wine that I had from Business Class SQ at $0.

@CaptainTiger @MillionaireTiger @TigerStars 

@daz88888888 @LMSunshine @melson @Bonta @GoodLife99 @SirBahamut