Financial Success: How much of it actually is self-made?

“I am a self-made millionaire.” You may have heard of someone materially successful made a remark like that before. The adjective denotes the achievement of something important purely through one’s own efforts only. And we tend to compare self-made wealth with inherited wealth; wealth passed down from one generation to the other. Today, I am going to discuss if one can determine one’s financial success in life purely through one’s own efforts only.

In my opinion, as how “it takes a village to raise a child”, it also takes a community to produce financially successful men or women. Nobody lives in an island alone by him or herself. For instance, take the hard work of most parents when they raise a child: it takes massive effort, time and money to raise a good kid with good values. Well, some children turn bad despite the good parenting styles of their father and mother but the point to note here is the skills, values and attitudes taught to them came from their parents when they were young. Like eating wholesome and nutritious food for breakfast, lunch and dinner and not junk food and candy. Their parents also fed, clothed, housed and guided them during their childhood days. And many more examples. Some young adults are lucky to have their parents pay for the increasingly expensive tuition fees when they go to university to further their studies. Or some continued to live with their parents (like my case) even though they are working already. These are contributions put by their parents which are not acknowledged when financially successful people claim they did everything by themselves.

I also feel that in the pursuit of good financial skills and knowledge, these people also are fortunate to have access to mentors and the ability to pay them to teach them skills which are otherwise not accessible to someone of a lower socioeconomic status. Take Warren Buffet for example. He did not claim to discover everything by himself; he learned the art of value investing by Benjamin Graham and was his student for a period of time before he was ready to struck out on his own. For example, I don’t claim that I did everything on my own; even before I struck out live investing on my own, I had to read investment books of experts who had gone the way before me. I had financial websites and books to guide me on the basics of stock and REIT investing before I took the plunge.

Besides this, I also realize that there are many things beyond our control that affect our chances of financial success. In the second paragraph, our family background is one of them. How well-off and functioning they are will determine how much of a head-start you would have than someone who came from a poor or dysfunctional family background. The opportunities for education and jobs in a country is another. In my company, I had one cleaner who is a Myanmarese. The security guard who supervises his cleaning told me that he had a post graduate degree in his home country. I was shocked to discover that someone of high educational background was working as a cleaner in Singapore. Why is that so? Simply because there isn’t enough job opportunities in their homeland.

It is also in my opinion that there is some degree of luck involved when you are applying for a job. It is not always true that the best qualified people can get hired in a job interview. Some high-paying jobs require connections with people involved in the industry. And there is also job discrimination. It is unfair but it happens. It happened to me. I was applying for a simple cashier job in a supermarket and the hiring manager refused to hire me as he claimed that “I was feeling nervous” when it was not the case. There was not much organisations that I can go to to seek redress in Singapore. I had no choice but to remain in my low-paying part-time job to get my daily needs met. This is not to air my grievance about the Singapore job market but to illustrate a point that the fate of your financial prosperity may be in the hands of others.

Another point to make about financial success, especially when you are relying on investments to grow your wealth, is that you can’t control the market. You may attempt to predict it or have a trading plan to react to it when something happens, but ultimately, the market is not within your direct control. You can make plans for it (which is a good thing), like “I will buy xxx ETF when the index falls by 10%” and etc, but whether it falls by 10% or not, is not within your circle of influence.

Lastly, health is another factor which determines at least part of your financial prosperity. If you are constantly ill and in need of medical treatment, you may be temporary or worse, permanently unable to work and hence remain poor for the rest of your life. There is a reason why people say “health is wealth”. Health is like the first digit one in front of the numerous zeroes you have in a bank account- without it, all you have left is the zeroes in the bank account.

It is true that we have to be disciplined and take consistent and right action in order to take advantage of the financial opportunities that is available to us in our respective countries. However, most of the factors I feel that determine our financial goals are not within our control.

What do you think of this post? Any thoughts? I would love to hear from you in the comments section below.


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