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Higher salary does not mean one is richer yeah. TRUE.

In an article I read in FreeMalaysiaToday.com, this is what our PM Tun Dr. Mahathir Mohamad said. A rich country is determined by the strength of its people’s purchasing power, not just high salaries. Even if one were to have a salary increase of 10% to 25%, this would come to naught it the cost of living rises by the same number. Then he said this which is SUPER TRUE!  “Production costs will increase, and so will the cost of living. Even with a salary increase of up to 25%, our purchasing power does not necessarily increase by 25%. So again, there will be requests for higher salaries and wages, but if there is a salary increase without an increase in production, the money we get will not have any meaning at all.” He encourage the younger generation to embrace noble values such as being hardworking and focus on higher productivity instead of just asking for higher salaries. Here’s that full article in FMT for reference. 
Some time back, I wrote this: Higher salary does not equate to better future, immediately  This was one part of my conclusion: “Do people have a better future when they get a higher pay? Well, as long as their expenses expenses are similar to their peers and they earn incomes which are 30-40 percent higher, of course their lives are going to be way better.” I think this will always be true. When we look at higher salary per month basis, it is even more important that we work on building up that wealth further. First is by not overspending on the unnecessary and second would be to invest it into something useful. We must remember that property is usually the largest purchase we will ever make in our lives and this is why if we do not own one, then the expenses to have a roof over our heads; rental will always haunt every month. Here’s an earlier article showing why even when people earn US$2,400 (RM9,600) in some cities in the U.S. they are still classified under the poverty category.
The reason is simple. When we are still working, rental is easily covered by the monthly salary. We may not feel it at all. This is assuming we prefer to rent and not to invest into a unit and pay slightly higher maybe. Well, with retirement at 60 and living till 80, that’s another 20 years of monthly rental yeah. If we have no recurring income and has to rely only on savings, then this is the potential rental amount we need to have.  RM1,000 (typical rental) x 12 (months) x 20 (years) = RM240,000. If we are lucky, our partner shares half of this rental with us, then it’s RM120,000 for the next 20 years if the rental stays the same for the next 20 years yeah. If only I have RM240,000 I would prefer to use it for some local and overseas travel when I have more time. By then, I could travel during those low seasons and thus get the best value for my money. I do not wish to worry about paying rental even when I travel. Happy working harder and earning more.
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written on 13 Aug 2018
Next suggested article:  Every job can be a career, stop stereotyping!

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Charles Tan The Founder The Writer Kopiandproperty
Charles Tan

Charles is Founder of kopiandproperty.com He writes from his investment experience for the the past 20 years in investments including property, stock, unit trust and more as well as readings and conversations with many property gurus in the industry. kopiandproperty.com is an independent property blog which is not affiliated to any media company, property developer or even real estate agencies.

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