I often write on Quora.com, where I am the most viewed writer on financial matters, with over 267.1 million views in recent years.
In the answers below I focused on the following topics and issues:
- Why should I save a lot of money for when I get old instead of using that money to enjoy life while I am young? What are the trade-offs? I explain how older people often have more energy and happiness than people expect, as shown by a famous behavioural finance book.
- For most English-speaking expats, is Tokyo a decent place to live?
- Is Siem Reap a good place to retire, or do superior options exist in Asia?
- If you aren’t interested in personal finances, or even hate the subject, how can you ensure that you will become financially secure?
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It is a great question. It is one of the reasons why people don’t invest as much as they know they should.
One of the most underrated personal finance books is “your brain and your money”
It mentions how many people don’t save and invest at a young age because “I won’t feel good at 50, 70 or 90”.
Then they get to 60 and realize they feel great – with some exceptions of course.
This reminds me of one of the best answers I have seen on Quora in recent years.
One of the contributions to this answer (below) mentions how he has more fun at 50 than he had when he was young.How do you keep life fun as you get older?https://www.quora.com/How-do-you-keep-life-fun-as-you-get-older
The main reason is expectation vs reality. A 10-year-old, or even a 20-year-old, always expects a lot.
The first time you go away on holiday with friends, or visit a club alone, you expect to have “the time of your life”
That gradually reduces. Even when you are say 30, your expectations aren’t always as high as when you were a teenager.
50 isn’t considered old by most people, but plenty of teenagers think otherwise.
For me, personally, at a young age I had many friends and associates from all age groups.
I noticed early on that older people tended to care less about the opinions of others.
They were more likely to be authentic, as a broad generalization, as they stopped caring as much.
So, ironically, you might wake up one day as a 50, 60 or even 85-year-old, and realize you are more comfortable in your own skin, and have more fun, compared to in your 20s.
However, of course life is about a balance. It is better to live for today with a strong eye for the future.
The biggest mistake that most people make, however, is overspending to impress others and to fit in.
That is the worst of all world’s. You spend more AND have less fun/feel less happy.
It depends on several things. I will speak more broadly from the point of view of “English-speaking expats”
These are the positives
- It is clean, polite and things work
- The food scene, both local and international, is great
- Internal travel opportunities are plentiful.
- Tokyo isn’t as expensive as it once was. In the 1980s, it was the most expensive city in the world according to many measures. These days, according to personal experience and looking online on Numbeo and beyond, it isn’t cheap, but there are many places which are pricier.
- It isn’t always as high tax as people assume either. For non-Japanese people, it is possible to pay 0% on overseas income for the first five years only, and do so legally. So, if you are retired, work remotely or have an online business, it is possible to legally reduce your taxes to 0% for a few years at least. There are some caveats to this. For example, Americans pay taxes on overseas income to the US government
- There are issues with xenophobia, but it isn’t in your face and aggressive, especially as a Western expat.
- There are so many things going on. You never need to be bored.
These are the negatives
- It isn’t London, New York, Singapore or even Dubai. It isn’t really an international city. In terms of food? Yes. In terms of mentality and number of expats? No. It is still very Japanese. You might see this as a positive or negative, but in the real world, it can be a negative. A few years ago I spoke to a German man who was head of HR for a healthcare company in Japan. He told me that he loves non-Japanese candidates who speak Japanese, but prefers those who haven’t lived locally for years. The reason? People start adapting in negative ways as well. They become less entrepreneurial, try to fit in etc. In comparison, a Japanese American who has come fresh from Silicon Valley, might have a different perspective.
- Following on from the last point, it isn’t the best place in the world to start your own business, at least if you are focusing on the local market. In some industries it is great. I also know many foreigners living in Japan who make money from international, or online, businesses, which aren’t focused on Japan.
- Japanese isn’t the easiest language to learn. It will take you 5–6 years, most likely, unless you actually study it formally as a full-time student. This isn’t an English-speaking environment unlike Singapore.
- Job options are limited. If you have your own business and/or are independently wealth, are retired or speak Japanese this isn’t a big deal. If you are a very well-qualified expat, who is on a good 2–3 year contract, you might struggle to change roles compared to some other cities.
- It isn’t a retirement destination for most, unless they are married to a local. It is a work destination. It can be good financially, but not always for lifestyle. I know several expats who loved Japan as working-aged people, then early retired. They realized there were better places to be as a retiree.
Overall, Japan is a great place to live for most expats, and better than most cities in the region.
For some though, the majority English-speaking cities of Singapore, KL (Malaysia), Hong Kong and Manila will still be preferable.
I know a few people who have retired in Cambodia, including Siem Reap, Phnom Penh and some beach resorts.
Needless to say, the answer to your question depends on your preferences. Here are some of the positives and negatives.
- The vast majority of people are friendly and not anti-foreigner. There is also a respect towards older people, so fewer people will try to scam you compared to younger people. I noticed a huge difference when I walked the streets with an older associate in Cambodia back in 2014, compared to others I associated with.
- It is safer than you would expect
- Visas are still relatively easy to get. Granted, they don’t have a formal retirement visa, unless that has changed, but you can live on a “business visa”
- It is fairly laid back
- Just like most places in South East Asia these days, it is easy to travel cheaply between countries….or at least it will be again once COVID-19 has ended.
- It is a USD-focused economy. Whilst that can make some prices higher, it also makes your costs easier to work out if your pension is in USD.
- English isn’t as good as Malaysia or the Philippines.
- It isn’t as cheap as you would expect compared to some places in Thailand and Malaysia.
- It isn’t as efficient as Singapore of course, but even not as efficient as a place like Malaysia
- Whilst Phnom Penh now has almost everything you would want, Siem Reap doesn’t have as many international restaurants and quality medical facilities as you would expect.
- Medical facilities, as mentioned, aren’t great. However, it doesn’t make sense to be uninsured. Therefore, this increases your costs. Most private insurers in Cambodia aren’t good, which means expat coverage is often the only realistic good option.
There are also fewer expat retirees in Cambodia compared to some nearby countries.
That might be a positive or a negative, depending on your preference.
To summarize, I would say Cambodia is a reasonable place to retire if you like a laid back and friendly country.
It isn’t so good if your expectations are super high.
You don’t have to be in love with cooking, or nutrition, to want to be healthy:
Likewise, you don’t have to be extremely knowledgable, or for that matter, interested in personal finances to get to grips with the basics.
You can either do basic reading, or outsource the process to an expert.
The key things to understand are
- Simple usually beats complex
- Live below your means and invest the surplus well
- Put your money into long-term orientated funds like ETFs which track the general market, unless you are a professional investor or have help.
- Invest one day after you are paid. If you do this, via direct debit, you will invest much more than if you leave it until the end of the month.
- Keep working on your income. Spending habits are also important, but if you can earn more without spending just as much, you have a bigger surplus to invest with.
- Get a job, get good at it and then start your own business. Not the other way around. In most situations this works better than focusing on ideas. Ideas don’t count. Execution does. You are in a better position to execute if you have experience in the domain.
- Focus on high-paying skills. That could be technical ones or soft skills.
- Keep reading. Focus on lifelong learning.
- Invest. Don’t save
- Surround yourself with better people. Network up. Get rid of toxic people.
- Avoid excessive uses of vices and others things which drain your money and motivation.
- Be focused on what you want to achieve and don’t give up.
- Take calculated risks. Life is about risks. Try to take these risks when you are younger and have less time to lose, and plenty of time to make up for any losses. “Better safe than sorry” doesn’t work if you don’t have much to lose and aren’t happy with your life. By the same token, however, taking silly risks doesn’t make sense either. A balance is needed for most people.
If you do all of those things long-term, you will be fine
Pained by financial indecision? Want to invest with Adam?
Adam is an internationally recognised author on financial matters, with over 267.1 million answers views on Quora.com and a widely sold book on Amazon
In the article below, taken directly from my online Quora answers, I spoke about the following issues and subjects:
- What income is considered wealthy? I tackle this misconception that wealth and income are always linked.
- How can you avoid the issues that come with sudden wealth, like an inheritance or lottery win? What makes people who have acquired millions in some cases go broke?
- What is the most accurate test which can determine where you should move as an expat? Which languages you speak, your hobbies and interests or something else?
- Is hustle culture, and “working hard doing something you love”, misleading? I speak about some of the many limitations of hustling, even though working hard isn’t a bad thing.
To read more click on the link below.