Regaining financial integrity

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  • Monday, 13 Jul 2015

People talk of money and corruption but what about their own debt-servicing responsibilities? 

SO, how did it get so bad?

Sorry but I really got to be vague this week after someone did a horrible hatchet job on my last two articles – to a point I almost gave up being a columnist.

Maybe some people are just too fearful to stand up to those whom they allow to lord over them!

Anyway, I promise not to mention 1MDB or Wall Street Journal this week. I will instead share a personal testimony and hopefully, get the message across.

And that message, dear friends, is about the importance of maintaining integrity in financial matters because from my experience, nothing ruins a relationship as quickly as unpaid debts.

Usually, it starts with A asking B to lend him some money, with the promise to repay it as soon as he has the money.

But when the time comes, A doesn’t want to, making all sorts of excuses to avoid repaying.

This, however, doesn’t lead to a souring of relations just yet.

The problem starts when B notices A’s reluctance to repay the money, evident when A starts showcasing a life of luxury and opulence.

So B accuses A of absconding and A retaliates with accusations, counter-accusations, lawsuits, and threats, until the relationship is damaged beyond reconciliation.

We’ve seen this happen too many times between couples, friends, employer and employees, banks and customers, contractors and subs, and so on.

Now let me share a personal testimony with a little boast.

I am a rich man!

Yes folks, I’m rich – but not the kind who gets chauffeur-driven in a Rolls Royce and owns a summer villa in Tuscany.

My definition of “rich” is simply this: I don’t owe anyone any money.

Meaning, if I die tomorrow, my family doesn’t have to worry about servicing any debts.

Although I am no Robert Kiyosaki, allow me further to share the secret to my financial freedom: Clearing all debts as fast as possible (like your life depended on it).

Last week, I posted a letter from my university vice-chancellor on Facebook. The letter basically thanked me for settling my student loans within a year after my graduation. The VC ended his letter stating his hope that more students would emulate my example, as the university’s ability to assist poor students also relies on what’s left in their own coffers.

That post went rather viral (by my standards) and shared by over 30 people. The reason, I believe, is not so much that I repaid my student loans but because of how quickly I repaid them.

You see, the letter was dated Nov 1, 1998, i.e. just a year after I graduated and right smack in the middle of the worst economic crisis Malaysia had faced then.

So people knew I didn’t have a high-paying job – in fact, I drove a taxi and waited in pubs at night to make ends meet. Yet, they saw where my priorities lay. Despite the fact that the university didn’t chase me for payments, I still chose to repay that little debt first before anything else.

Today, I maintain my debt-free status, even if I have to forgo some other luxuries in life.

I ended that Facebook post by throwing a challenge to young Malaysians to settle their own student loans first. You see, while the alleged RM42bil remains the hot topic, people forget that a larger amount is missing, i.e. RM43bil from our national student loan fund, PTPTN (assuming the revelations that only RM2bil had been recovered out of a total of RM45bil disbursed are correct).

Today, people love to talk of corruption, missing money and illegal money trails. Yet many choose to remain indifferent to their own debt-servicing responsibilities.

Making comparisons to Greece from the feared collapse of a certain national fund may be premature. For just like in any household, a national economy’s collapse may only occur due to a culmination of total unpaid debt, whether they are student loans, credit card debts, housing and vehicle loans – in addition to mismanaging public funds.

Debt, regardless of its form, may be traced to three sequential reasons. The first is covetousness i.e. that compelling desire to own something that one cannot afford.

The second is the desire to borrow money to own that which you can’t afford.

The third is the refusal to accept responsibility after acquiring that debt, putting a person on a downward spiral of financial difficulty.

In the end, the debt-laden individual will be forced to borrow from other sources just to service that first bad debt, juggling a little here and there until he finally gives up and defaults.

That, in a nutshell, is the story behind Greece and if I may, seems imminent in our own land – unless people start reversing that vicious cycle of covetousness, acquiring debts and purposely defaulting on them.

There is no better time to regain financial integrity than now. While it may be clichéd to say “Give to Caesar what belongs to Caesar”, we must accept that only after we’ve regained our own financial integrity may we expect our institutions to do the same.

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Opinion , East Malaysia , thiru


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