Why saving money is just like bodybuilding

Why saving money is just like bodybuilding

It takes lots of discipline, says former varsity champion who saves a third of his income, of which 20% is invested

By Lorna Tan
Jul 01, 2007
The Straits Times
BODYBUILDING and money management seem worlds apart but Sean Toh reckons the discipline and focus needed to build impressive muscles are equally useful when it comes to building financial freedom.

Mr Toh, 35, a former varsity champion bodybuilder, distils his views into his book, 4 Steps To Financial Freedom. 'The difference between the rich and the poor is that the rich have more financial muscles. Money management is a skill that needs discipline to practice those saving habits.'

His own approach to investing is to buy when nobody dares to invest and sell when the herd is buying. He prefers to do his own research and execute his trades personally via online platforms.


Mr Toh's determination to get to grips with the investment learning curve involved reading more than 200 financial books and magazines.

He has been teaching design and technology at Henderson Secondary School for seven years, and also facilitates innovation and enterprise programmes for students.

An air steward before pursuing his studies at the Nanyang Technological University (NTU), Mr Toh managed to save $100,000 during his 31/2 years with Singapore Airlines. That was enough to settle some family debts and pay the tuition fees of his engineering course.

He is married to Australian Heather Parry, 39, and has two daughters.


Q Why did you decide to go into bodybuilding?

A I fractured my knee in Secondary 1. As part of the therapy, I underwent weight training. Since I had always wanted to have a muscular body, I began to fulfil my dream of being a bodybuilder.

I spent every available moment in the gym training. In 1998, I participated in Muscle War, an inter-varsity annual bodybuilding competition, and came in third.


Q What lessons can you draw from bodybuilding that are relevant to money management?

A Managing your money is like a bodybuilder dieting for a contest and having to restrict his fat and salt intake. We are always tempted to break away from the strict diet, like saving money, to have a pinch of savoury foods - overspending.

Saving money is hard for some people because they lack the discipline to save for future investments but tend to overspend on things they don't need. Saving money is like building your biceps.

Being rich is about having more discipline to learn, save and use those financial muscles to leverage on investing to build more wealth, like a competitive bodybuilder preparing for half a year just to win on competition day.


Q What are your money habits?

A I save about 30 per cent of my income, of which 20 per cent goes into investments.


Q What financial planning have you done for yourself and your family?

A Cashwise, I have about $50,000 in stocks and $70,000 in fixed deposits. I also invest my CPF in stocks and unit trusts.

I've made more money from unit trusts than stocks. I own shares in Singapore Petroleum Co, Singapore Exchange, Hyflux, Aussino and Creative Technology. As for funds, I have NTUC Income Prime fund, Aberdeen Japan and Indonesia funds.

I typically buy a unit trust when the value has dropped 6 per cent and practise dollar-cost averaging each time it drops further by doubling my next investment. When I make 20 to 30 per cent, I exit the fund.


Q What about insurance planning?

A I have bought personal life insurance, term life insurance and disability insurance for my family and myself. My annual premiums amount to $5,000.


Q How do you reward yourself?

A By spending 10 to 30 per cent of my investment return on books, food and holidays with my family so that I will be motivated to create even more wealth. The rest of the capital is re-invested.


Q Moneywise, what were your growing-up years like?

A I am the eldest child with two brothers. My father was a butcher. Money did not come easy and I worked to earn extra money when I was schooling.


Q How did you get interested in investing?

A I was having problems managing my personal finances after getting married in 1998, my final year at NTU. I was the sole breadwinner. I challenged myself to explore the option of one person earning two or more incomes without taking on more jobs.


Q What has been a bad investment?

A Investing in units trust without understanding the operating mechanism. I invested in an Indonesian equity fund in the 1990s which was touted as the best-performing fund then. Luckily, I invested only $1,000 so I was able to manage the risk. I advise investors to record their investment lessons in a logbook so that they will not repeat the same mistakes.

Never forget the No. 1 rule of master investors: Don't lose your investment capital.


Q Your best investment to date?

A It is my book. Although I enjoy better returns from units trusts and stocks, my book offers me returns that are tangible as well as intangible.

I broke even and got back my $10,000 capital five weeks after the book's launch. This book offers tangible returns such as royalties and intangible returns like my self-actualisation of being a best-selling writer at Popular bookstores and the ability to empower others with the knowledge to control their financial destiny.


Q What is your investment philosophy?

A These four steps to financial freedom: get healthy and strive for great health; adopt an open mindset to learn; invest your time in your financial and health education; and enjoy the wealth that you have created.


Q And your home now is...?

A It's a fully paid-up four-room HDB flat in Woodlands.


Q And your car is ...?

A I don't own a car and I don't have a driving licence.