While we may have heard the term a lot, we might or might not know what exactly it means and most of us on the lower side the age of forty five have no clue what it feels like. To understand the mid life crisis we need to first look at our life cycle.
When August rolls around next year, Singapore will be 50 years old, and while we have progressed significantly as a country, we still seem to be trapped collectively in a mid-life crisis of sorts.
As of now, the critical domestic financial challenges faced by Singaporeans can be attributed to the following factors:
- Rising costs of living
- Slower economic growth
- Aging population
- Declining population
- Continuous influx of immigrant workers
- A more privileged youth with higher materialistic expectations
How Did It Emerge?
It all begins with us being born, obviously, but this article is about how we give birth to the problem. We grow up, go to school, and finish college. It’s the golden era of our comfort years. All we need to do throughout this period is concentrate on our studies and have fun, ask for money from our parents, blow it up on our friends.
Basically, there is no concept of earning money or saving money, the most worried you can get might be about your grades or finding your identity. Then we look for a job post our graduation or study further. If we decided to study further, our previous lifestyle of not having to worry about anything apart from grades continues.
This is the time you realize the power of money and start working towards earning more and more. With little or no effort, you keep getting regular increments and regular promotions and you are very satisfied in life. This is the time when you are in your mid 20s and start to find your soul mate because your professional life seems sorted.
You get married, have kids, and raise your family. This is a time when you mostly reach the epitome of happiness because you have a luxurious life and a nice family thanks to a stable job and a steady flow of income. Throughout your thirties till your forties you get to enjoy this happiness.
Post forty five is usually the time when your regular salary increments start to decline no matter how much effort you put in and your professional career starts to plateau. This is the time you start getting worried about your income because by now you are used to a certain kind of a lifestyle. When this worry starts pricking your conscience, you, my friend, have just hit the mid-life crisis.
Reconciling Expenses with Savings
Income includes your active and passive income as well as your expenses and savings. You need to learn how not to over indulge from the start, basically you need to know how to live within your means and this process begins as soon as you start earning in your twenties. Even though you think that you don’t need to, you very much need to get into the habit of saving money.
No matter how small the amount is, keep a savings account and deposit some amount of money in it, preferably a minimum of 10% of your income.
Your thirties is the right time to think about investments so start gathering as much knowledge as you can about the things you can invest in – while some people swear by property, some people might advise you to invest in stocks. Learn about all this and decide what suits best for you keeping in mind the expenses that your family requires.
What you need to do is learn the art of balancing expenses.
In your forties when you are approaching your mid-life, you will have to be prudent regarding the money you spend to avoid a mid-life crisis. It is the time when expenses shoot up significantly because your children are growing up and you need to regularly invest in their higher education, and deal with the fact that your salary increment may not be rising at the same pace.
By this time you must have an alternate source of income, a means of getting passive income along with your main source, that is, your job.
Thanks to your amazing planning and savings you will be able to enjoy our fifties, whether you retire voluntarily, involuntarily or even if you are still working because the pressure will be off of your head. If you made good investments in your hay days, they will be bearing fruit today and you will not have to lose out on anything just because you have retired. This is a sure shot way to avoid a mid-life crisis.
Now that you know what steps to take at which age, it might become easier for you to never worry about money in your life. Whatever you do, always remember that the key is to save money because money saved is money earned. So, as soon as you start earning, you must start saving. Even a little money right now will go a long way later on.
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