Quora Answer: Why Do Rich People Keep on Working after They Have Amassed Enough Wealth to Take Care of Their Families Forever?

The following is my answer to a Quora question: “Why do rich people keep on working even after they have amassed enough wealth to take care of their families forever?”

People have a lot of reasons to work, and it is not always about money.  The idea that people only work to amass wealth is actually an immature way to look at life, and this is what separates the higher socioeconomic classes from the lower socioeconomic classes.  It is about mindset.  Some people want to succeed consistently, and some are content to sit back and sloth about.

People work because they enjoy their work.  They gain some sort of job satisfaction, and their success in their profession and business is part of their identity and self-esteem.  For others, it is about status.  They have moved past the subsistence thinking, and are playing an elaborate game of acquiring influence and power.  This may, or may not be good, since the acquisition of power for its own sake is itself another aspect of being a miser.  Some people, particularly the extremely wealthy, want to leave a legacy.  They want to effect change, and pour their wealth and resources into causes.  This is still work.

Quora Answer: Where Can I Learn about Passive Income?

The following is my answer to a Quora question: “How can I learn about passive income?” 

When people talk about passive income, they tend to include portfolio income, which is generally thought to be distinct from passive income, according to the tax authorities.  I am assuming that you have the financial means to engage in these activities. 

With regards to quintessential passive income, there is rental income and business income.  For the former, you need to understand the rental market, and the legalities and financial options of owning such property.  There are a multitude of online courses that purport to teach that, but most of them are either scams or teach you things you can discover for yourself, through basic research for free. 

With regards business income, you need to know how to discern a viable business plan from optimistic sink holes, which most are.  Again, there are no courses online.  You need to learn, to make mistakes, to learn from other people’s mistakes, and to make it up as you go along.  Along the way, you will eventually learn the ins and outs of running a company, and your rights as a shareholder and non-executive director. 

If you are talking about portfolio income, which is investments, it is better to find a good financial services consultant, whether a broker, an agent, or wealth manager, to do so for you.  Finding such an advisor is likely to be a quest in and of itself.  There are a lot of consultants, but few are that good, and you want the very best.  The very best is not necessarily the best salesman since it is easier to be a product pusher.  What you need is someone with the skills of fund management.  Like the previous example, online courses are a waste of money.  If these people knew how to make money from this, they would not be pretending to be experts selling “secrets” of investing.

Quora Answer: Why Does the PAP Want Singaporeans to Buy Electricity from the Private Sector?

The following is my answer to a Quora question: “Why does the PAP want Singaporeans to buy electricity from the private sector?”

By opening the retail sales of electricity to the private sector, it promotes efficiency and the lowering of costs, which benefits the people.  The government then consolidates its side of the operations into electricity generation only, which is also much more efficient.  Spawning a retail electrical sector spreads the wealth and stimulates growth, which ultimately benefits the economy by increasing GDP.  Singapore is a capitalist economy.  After spending time laying the groundwork for growth and setting the standards, it is government policy to eventually privatise non-core services, converting cost centres into profit centres.

Quora Answer: What are Some of the Most Profitable & Consistently Performing Ways of Producing Passive Income?

The following is my answer to a Quora question: “What are some of the most profitable and consistently high performing ways of producing a passive income?”

Passive income is defined as income resulting from cash flow received on a regular basis, requiring minimal to no effort by the recipient to maintain it.  It is distinct from portfolio income, which is often mischaracterised as passive income.  Generally, passive income comes from two sources: rental activity or business activities where you do not materially participate.  Whilst some financial institutions may recognise the income from capital growth, or negative gearing, they actually relate more to portfolio activities, and the use of financial instruments.

If you have the means, the most straightforward means of getting passive income is to invest in property directly.  REITs would fall under portfolio income, not passive income, since you do not manage the property or own it outright.  Rental income, manage properly is consistent.  You can outsource the property management to another entity, and just collect your rentals.  The issue is the high entry barrier, and the attendant complications of being a landlord.  There is a steep learning curve.  If you have property, you can flip it, and that is a source of income as well, provided you make the correct call.  There is a higher inherent risk since it involves a lot of leverage.  It is important to anticipate the market, and not be reactive.

Another way to earn passive income is to invest in a business.  You become a shareholder, and live off the dividend and profit share.  If you are a significant investor, it would be prudent to have a place on the board as a non-executive director with major voting rights.  That way, you have a say in the disbursement of dividends and the profit share.  This is not as easy as people imagine since most businesses do not perform well, and you stand to lose a lot of money backing the wrong horse.

Quora Answer: Why are Singaporeans Quick to Conclude That Anyone Voting for the PAP is Stupid?

The following is my answer to a Quora question: “Why are Singaporeans quick to conclude that anyone who is voting for the PAP is stupid?”

There are some illogical assumptions here.  Firstly, the majority of Singaporeans have consistently voted for the incumbent, and not the opposition parties.  So, you cannot say that Singaporeans are quick to conclude voters who voted for the incumbent are stupid, since they are obviously not the majority, as implied by that line of question.

Secondly, there is no real evidence that a majority of Singaporeans think PAP supporters are stupid, or vice versa.  There are people who are disgruntled either way, but that is the nature of a democracy.

Personally, I have voted for both sides, depending on who is running in my ward.  I vote according to my interests so it matters to me what policies are proposed, who is running, and what I stand to gain.  And I believe that everybody has that right.  I do not take kindly to people telling me who to vote for based on partisan beliefs, and I believe most Singaporeans are like that.  I am a practical man.  I am not invested in the fortunes of individual political parties.

Quora Answer: Is it Safe to Release These Terrorists Now That the Islamic State No Longer Exists?

The following is my answer to a Quora question: “Is it safe to release these terrorists now Islamic State no longer exists?”

ISIS still exists.  But even if it were to cease to exist, releasing these terrorists means that they can revive it, or join similar organisations and start the process all over again.  It does not make sense.  If someone has joined or was caught in the process of joining a group such as ISIS, I do not believe there is any rehabilitation for these people.  They were willing to betray the country, the society, the community that raised them, for a group which is an existential threat to everything they have left behind.

Quora Answer: Will Singapore Come to Israel’s Aid if It is Attacked by the Arabs?

The following is my answer to a Quora question: “Will Singapore come to Israel’s aid if it is attacked by the Arabs militarily?”

If you had bothered to look at the map, you would notice that Singapore and Israel are not exactly close.  Between Singapore and Israel are all the Arab nations that would conceivably attack Israel.  Singapore is also surrounded by Muslim-majority nations.  If there were such a conflict, regardless of how close Singapore and Israel are diplomatically, Singapore is in no position to send any form of military aid.  Whatever we would consider sending would have to go through several thousand kilometres of hostile territory, whether by sea or by air.  Military aid for Israel is likely to come through the Mediterranean coast, from European and American assets based in the region, not from Singapore running through the gauntlet of the Red Sea, and then the Suez Canal.  That would be a suicide mission.