Johnny graduated from one of the local private university as bachelor degree holder. Throughout 4 years of university life he has borrowed a bank study loan to pay for tuition fees. He spent every excess dollar he had in partying with friends, purchasing up to date electronic gadgets, video games, and holiday trips. He graduated with total $80 thousands in debt.
Right after the first successful job interview, Johnny happily went to shop for his first new car. His father would pay 20% down, understanding that his son would need the car to go to work and his father thought that is a good idea to get him started. Johnny chose a Japan model cost up to $70 thousands. He only needed to pay $1,000 per month out of his new job salary of $2,500. After all, his father has already paid off $14,000.
Since Johnny worked away from home, he had to rent a place to stay. He rented a small 2-bedroom apartment unit for $600. Personal privacy was very important for him, so he never planned to share the apartment with anyone.
Working life is busy for Johnny. He worked 8 to 10 hours per day from 9am until 6pm, some times 7 or 8pm. After work he would join his friend for long dinner, chat for an hour or two. Most of the time, he went happy hour with his friend till the midnight.
Johnny had a few credit cards when joining the work force. Banks love to give away credit cards to fresh grads. For the first time, Johnny felt life was blissful as then he could buy whatever he wanted. He was only required to pay the minimum. So he went to every big and small sale. He especially liked those UK/US imported clothes and shoes brands that cost a few times more than the other local brands. Besides, he felt it’s time to buy himself a real gift as he has been working hard for his life. So he bought the 42-inches plasma TV and PS3 set. He felt very grateful as there is a thing call installment so now he only needs to pay $200 per month for next 24 months. Thanks to his financial intelligent, he didn’t need to max out his credit card limit yet.
Johnny did great job in his company and his manager gave him pay raise almost every year. Two years down the road, he earned more than double from what he used to earn in the beginning. Then he thought it was time for him to invest in his first house. So he got himself a nice 3-bedroom, big balcony condominium unit near the rich area, he put his entire bonus money earned as down payment. He was officially a house owner now.
As he first gotten his house key, he excitedly contacted a few contractors and interior designer to discuss about house renovation. He borrowed personal loan to do the renovation, so there was no need to touch on his own saving. He would only use his saving to buy furniture for his newly renovated house. Furniture from IKEA would be ideal, as it is not too expensive yet tasteful design. He spent his entire saving in acquiring furniture like sofa, bed, lighting, wardrobe, full range of kitchen furniture and equipments. He has never cooked. Well, his friends would come up and have drinks and get together once in a while since he has a pretty comfortable home.
Most of Johnny’s neighbors were highly-educated professionals like doctors, architect, accountants and engineers. He began to feel out of the place with his 6 years old Toyota Vios parking in between of those latest Europeans and luxurious models. So he traded in for the latest Honda Accord.
With his self-perceived status, he only accepted banks offering him privileges of platinum credit card. He has a few credit cards of that color in his wallet. He paid up to thousands in annual fees every year. He only dined in expensive restaurants, he thought it would reflect his own status and taste if he suggested the restaurant to his friends. He only used the priciest products from grocery shelf as he thought the price reflects on quality of the product, which was also the value he perceived in things around. He paid to maintain membership of gym club even though he was overly busy for his work every day and he only managed to work out twice per month. Besides, he pays a few thousand dollars yearly to maintain the membership in a golf club. He likes to bring along his friends to the range once every two weeks.
Johnny once set aside a few thousand dollars for a hot mutual fund, persuaded by his friend who was working as mutual fund sales agent. The mutual fund was later become as cool as under water. Johnny never bothered about it anymore. On and off, he also burnt some money from trading in stock market as his friend informed him of some so called hot tips from insider. He gave up on investing, concluded that stock is too risky or thought that he simply has no luck in investing. When talking to his friends, he always liked to relate investing to buying a lottery ticket.
So Johnny continued to work hard, he worked to pay off debt; his house mortgage, personal loan, study loan, credit cards, annual bank fees, insurance, club membership, bills and other installments. He only has a few thousands dollars in bank saving set aside for emergency purpose. He started to realize he might not be able to maintain his current high consumption lifestyle in future with his current income, so he worked even harder, fought for promotion, hoped that one day he could be debt free and become rich.
- The End -
Read the sequel article – Why Can’t I Get Rich to find out exactly why Johnny can never get rich.
Well said. This is a nice example of how some people live in the big city. They look rich and smart but yet they are poor and financial uneducated.
This is probably nearing the extreme. But i do believe there are people live in that extreme or maybe worse.
Perhaps he will become a millionaire through his father (inheritance). But, without wise financial management, he’ll just be a temporarily millionaire.
Yes, if Johnny gets a few millions inheritance from his father, he would have probably planned for a crazy around the world tour, and buying a few luxurious european car. Most likely he will quit his job and start exhausting the inheritance. He would lose huge amount of money from stock market or being conned by con man.