Save for the future, but enjoy life along the way

		Straits Times: Sun, May 06
Saving for retirement is all very well but senior executive Kowshik Sriman prefers a balanced approach, one that provides for some fun along the way. The managing director of software company SAP Singapore believes people should enjoy living every phase of their lives as much as possible rather than scrimp and save while young just to accumulate wealth for old age. 'You cannot be miserly and save all that money when you are young, and spend it only when you are 60,' said Mr Sriman, 43. 'My general philosophy is that we need to balance saving for the future with living a quality life today... No point in oversaving for old age and missing out on enjoying life at a young age. 'The important thing is don't be cheap.' Mr Sriman, who has never rented his home before, has always believed that property is a good investment. Instead of buying a car first, he believes in buying a home as soon as possible. He studied electrical engineering at the National University of Singapore and has a Master of Business Administration from the University of Leicester. He has spent 14 years at SAP, starting as an account executive. His wife, Radha, 41, works part-time in business partner sales at IBM. They have two daughters, Monisha, 15, and Natasha, 12. Q: Are you a spender or saver? I balance saving with spending. I spend about half my income and mostly save the rest. I see it as a lifestyle choice to have two cars instead of one. This obviously costs me money and some people might say it is wasteful. But I see it differently. I can afford this lifestyle and luxury for my family, and it is a choice I make. To me, education is an investment. So is travel, as you are able to spend quality time with the family. There are a lot of people with the money but not the time. If you are able to make time for yourself, then you are truly independent. Q: How much do you charge to your credit cards every month? About $10,000 a month. We are against stretching ourselves and getting into debt and this is the culture in which I was raised. We do have some mortgage debt for the house that we're living in, but it is negligible. Q: What financial planning have you done for yourself? The bulk of our investment is in properties. My wife and I own two apartments and two houses, all in the Bukit Timah area. I also have some blue-chip stocks and some SAP stock. We also have several insurance policies for each member of the family. Q: Moneywise, what were your growing-up years like? I have one sister. My father was an engineer and my mother was a housewife. My parents' philosophy is to spend well within your means and never stretch yourself financially. Being immigrants from India, they have always wanted to be independent and financially free. They advised my sister and me to focus on our education as they saw that as a path to being independent and living a respectable life. We were also advised from a very young age to own the roof over our head and become debt-free. My parents live by themselves and are role models for my sister and me. They have a couple of properties and are living off the rental income. Q: How did you get interested in investing? You could say I fell into property investment. For sentimental reasons, we didn't sell our first and second properties and they have turned out to be good investments. I've learnt to not let greed or fear rule my decisions. It takes a lot of courage to make big decisions in uncertain markets, but the irony is most people are comfortable taking risks in bull markets when prices are high. If you are able to understand the herd instinct and control your own emotions, you can make sound investment decisions in uncertain times and take a back seat during the bull market. Q: What properties do you own? Our four properties range from 1,400 sq ft to 5,000 sq ft and the total value today is about $15 million. We bought our first property at a high in 1996 after we got married. We moved out in 2002 and upgraded to a townhouse in Watten Estate. We then bought another property in Newton in January 2007 for investment. The market was just on the way up then. We were going to put our money on a Lincoln Modern unit costing $1,250 per sq ft when we heard of an urgent seller. So we went to check out the unit and sealed the deal at just below $1,000 psf in two hours. Our current house was purchased in April 2009. The difficult decision was to buy when everyone was fleeing the stock market. If you look at the stock market, you get a good indication of what's going to happen in six months. So, do you want to wait for prices to bottom out or do you buy now? It took quite a bit of courage to decide to not wait. We were also mentally prepared for prices to drop further. The house cost us $800 psf and the value has almost doubled by now. Q: What's the most extravagant thing you have bought? I bought a Volvo XC90 for my wife as a Mother's Day gift in 2010. It was a decision I made on the spur of the moment. Looking back, it has been a worthwhile decision as it has served my family well. Q: What's your retirement plan? I believe I am already financially independent. If retirement means stopping work and being idle, then I don't think I'd ever want to retire. Some people think that if you are financially independent, you should retire or do some charity work instead. I have a different perspective. SAP is a great place to work and grow. I derive satisfaction from seeing many of my team members grow and be successful in their own right and become financially independent. As a family, we volunteer at the Society for the Prevention of Cruelty to Animals (SPCA) and also for other charitable causes, so it is not necessary for someone to be economically non-productive and retire. Q: Home is now... A 5,000 sq ft bungalow with a pool in Bukit Timah. Q: I drive... I drive a silver Mercedes-Benz CLS. [e-mail] Right balance 'You cannot be miserly and save all that money when you are young, and spend it only when you are 60. My general philosophy is that we need to balance saving for the future with living a quality life today... No point in oversaving for old age and missing out on enjoying life at a young age.' Senior executive Kowshik Sriman, on balancing saving and enjoying life True independence 'To me, education is an investment. So is travel, as you are able to spend quality time with the family. There are a lot of people with the money but not the time. If you are able to make time for yourself, then you are truly independent.' On education and travel Sound decisions 'If you are able to understand the herd instinct and control your own emotions, you can make sound investment decisions in uncertain times and take a back seat during the bull market.' On investing wisely WORST AND BEST BETS Q: What is your worst investment to date? I made speculative investment in Malaysian Clob shares after starting work in the early 1990s and having saved a sum after three years. I lost all $50k of my investment, which was painful for someone who had just started working. It taught me a valuable lesson - never follow the herd instinct. The majority may not be right when it comes to investment choices. Because of that, I shied away from equity investments. Until now, I don't want to hold too many equities. Q: And your best? It's my townhouse in Watten Estate as its value has gone up three times. We bought it in 2002 for $1.2 million and now it is worth about $3.5 million. At $1.2 million, I would be getting a 7 per cent rental yield. Source: The Straits Times