8. CAN YOU ACHIEVE FINANCIAL INDEPENDENCE AND RETIRE EARLY WITH A NINE-TO-FIVE JOB?

 

8. CAN YOU ACHIEVE FINANCIAL INDEPENDENCE AND RETIRE EARLY WITH A NINE-TO-FIVE JOB?

Being an entrepreneur or your own boss is not the only way to financial freedom.  

When you are in university, you aim to be the best version of yourself in learning and education. You aim to graduate (preferably) from one of the top universities in the field of your choice. 

After your graduation, you land yourself on your first job. Probably you stick with your first job for two to three years and then you accept a higher salary from another company. 

A few years later, you may be promoted within same organisation to a higher position with higher salary. Alternatively, you may change to another new job with higher pay. 

In your whole life’s working cycle as an employee, you will endlessly go through this corporate ladder climbing. You may climb one step at a time. At other times, you may climb two steps at a time. Occasionally, there may have some setback and you take a few steps back in your career. Or perhaps you may be stagnant and stay at the same step in your corporate ladder for many years.  

There are some who decide to have a career change and jump to another corporate ladder. Still, the same corporate ladder climbing cycle continues. The only difference is the ladder.

All of these is part and parcel of living a life of an employee working at nine-to-five jobs. Sometimes you may feel as if you are running in circles. But in fact, you are on a spiral, taking few steps at a time up the corporate ladder for higher positions, higher salaries.

 

Are you cut to be an entrepreneur? 

Most people think that if you want to make a lot of money and become a millionaire, the only way is to be an entrepreneur, to be your own boss running your business empire. 

Some well-known Malaysian entrepreneurs and business magnates are Robert Kuok, the richest man in Malaysia, Quek Leng Chan of Hong Leong Group, founder of Public Bank Teh Hong Piow, founder of Air Asia Tony Fernandes, and Grab’s co-founder Anthony Tan, just to name a few. Internationally, I believe Alibaba’s Jack Ma, Amazon’s Jeff Bezos, Facebook’s Mark Zuckerberg, Microsoft’s Bill Gates are familiar names to you.

To be a successful entrepreneur, you certainly need to have endless drive and motivation. You certainly need to be strong to overcome failures countless times over. You need to persevere and be responsible for thousands of people and families depending on you to put food on their tables. You certainly need to work super hard and long hours. 

Based on the statistics at SME Info website, 98.5% of business establishments in Malaysia were small, medium and large enterprises, cutting across all sizes and sectors in 2016. The total SME establishments came up to be around 907,065 companies.

Even though I don't have the latest statistics on the number of business establishments in Malaysia, I figure SMEs, public-listed companies (around 801 companies) and non-registered mama and papa shop owners combined will not have more than 1.5 million establishments. 

During job interviews with candidates for job positions at Jobstreet.com, I came across a few candidates who ventured out to do their own business before.

One of the candidates opened a tuition centre. Another candidate operated a cafe business for two years. One more candidate ran his own IT company. There was also a candidate who ran his own training and consulting business. 

When I asked them why they decided to let go of their entrepreneurship dreams and return back to a routine nine-to-five job, they confessed that being own boss wasn't that straightforward and easy after all. They were worried about their businesses all the time. They had sleepless nights worrying about their working capital, cashflow, overheads and rental. They were worried about sustainability and growth of business. Some of them dried up a big chunk of their hard-earned savings during their entrepreneurship journey. I guess their failed business ventures have further testified that business failure rates are rather high.

According to some studies, the small business failure rate is around 20 person for businesses that are one year old. The failure rate will be about 30 percent in their second year, 50 percent in their fifth year and 70 percent in their tenth year. 

Apparently, it’s quite challenging to keep business afloat, break even, make profit, expand, and continue to be market leader. Therefore, I would presume not all of 907,065 registered companies in Malaysia are successful. 

On a positive note though, a few of my ex-colleagues left their nine-to-five jobs as employees to start their own businesses. One of them runs a successful boutique homestay in Penang. Another used to own two male-clothing retail outlets in Klang Valley but both were closed down not long ago due to high rental and highly competitive market.  She is still on her own operating a successful property agency. Two others are running very successful recruiting firms with a strong workforce. Another ex-colleague has become a very successful self-employed trainer. 

Are you more of an entrepreneur or an employee of a nine-to-five job?

I guess it all boils down to whether you are cut to be an entrepreneur. If you have the enterprising spirit in you and dream of becoming your own boss, then I would like to congratulate you. Go ahead and be the best entrepreneur you can be and live your dream. The enterprising journey is challenging but definitely rewarding. 

But not everyone is cut to be your own boss. 

According to the 2018/2019 United States GEM Report, nearly 16% of the United States adult population are entrepreneurs. Perhaps the percentage of entrepreneurs in Malaysia is about the same, around 16%. Literally speaking, for every 100 adults, only 16 are entrepreneurs. On the reverse, 84% (84 in every 100) of adults are employed at nine-to-five jobs in all sectors and industries. 

The question is, "Do you fall into the 16% (entrepreneurs) or the majority of 84% (employed)?

Reasons why I'm more of an employee of a nine-to-five job than an entrepreneur

By nature I'm an introvert and a risk-averse person. I'm overly analytical in most situations which can potentially paralyse me in my business decision makings. I also prefer to live a simple, low-profile life. Even though I enjoy life adventures and roller coaster rides at amusement parks, I'm not so suitable for roller coaster rides with major ups and downs in life. I think I may die of heart attack prematurely if I'm placed at such situations with insurmountable pressure. 

I’d be lying to you if I tell you that I never dreamed of becoming an entrepreneur. I was like some of you who dream of owning your own businesses, calling your own shots, not reporting to anyone. 

But my dad once advised me, "Son, I know you think running your own business is exciting. You become your own boss and you no longer have to report to a boss. You call your own shots. But do you know that you need to worry about your business 24/7? Do you know that you need to worry about monthly overheads and the salaries you need to pay out to your staff?” 

He then continued, “Besides, you are too kind-hearted. If your customers ask for a better deal, you will easily give discount. If your customers tell you that they don't have money today, you will tell them that they can pay you later. You may end up not getting your money back.”

My dad took a deep breath and continued full of love, “In business world, people take advantage of you if you are too kind. Don’t you have a god brother who borrowed RM14,000 from you more than 25 years ago to open his business? Did he return his money to you? Never. You are too kind to even ask for the money back. Business world is cut-throat. You will not survive well, my dear son." 

I think my dad knows me pretty well. Afterall I’m his son. As much as I wanted to deny, my dad was spot-on about my weaknesses. 

 

My dad’s journey as an entrepreneur 

My dad spoke from his past experience as a businessman. He had walked the journey personally. He used to work for others in restaurants, rest houses and pubs to make ends end in Penang and Kedah. After he saved up some money, he went back to his hometown Langkawi to seek better opportunities.

In 1968, my dad plunged into his first business venture, opening a small motel called Hotel Langkawi in Kuah town. It was a year after I was born. My only sister was four years-old then. 

My dad’s savings wasn’t enough to start the motel business. He ended up borrowing money to pay for two units of old, semi-ruined shophouses. He converted the shophouses into a twenty-two room motel. My dad also converted half of the motel's ground floor into a restaurant, figuring hotel guests had to eat anyway.  

My mom became the cook at the restaurant serving Chinese and western food. My mom also became house keeper for the motel, changing bed sheets every day after check-outs by motel guests. 

We slept in a room downstairs at the motel. That was practically where I grew up. 

No doubt my parents could make a living from opening a small motel and a restaurant in Langkawi. The income wasn't much. It was enough to live a comfortable life, but not a rich life. 

The motel business was 24/7 in operation. It was long hours and laborious with inflexible time. My parents couldn't go anywhere together. At least one of them needed to be physically present to look after the small business. 

As far as I could remember, I had only a few rare opportunities I could go out together with my parents. I was usually going out with my mom or with my dad, rarely both together. One of the happiest and most memorable time we were out together as a family was in 1989. My parents took the time off from work, and brought my sister along to visit me in California during my university days. We were happily together as a happy family for a week. I brought them to visit most of the tourist attractions in beautiful California. That was indeed the longest, happiest holiday we ever had as a family. Until today, I treasure those beautiful moments.

 

A taste of running my dad’s motel business

After university graduation, I came back to Malaysia to be closer to family. I started working at Seagate Penang in 1991. After close to four years of working in Penang, I quit my nine-to-five job, packed my bag and went back to my hometown Langkawi. 

Witnessing my parents ageing daily, I thought perhaps it was time for me to give up my own career so that I could help my parents in their small family business in Langkawi. I am the only son. No one else my parents could turn to for extra help. 

During the first three months, I soaked myself completely in running my dad's family business. 

I helped my mom to change bed sheets, handle front-office check-ins, attend to motel guests’ phone enquiries and reservations. 

I also helped my dad on book keeping. It was the first time in my whole life that I had to write down all the daily transactions on business income and expenses. 

It was a total motel management and operation involvement. I was very glad for such opportunity indeed. 

My parents could see that I was trying my best to be their successor, to ease their workload, and to give them an opportunity to retire fully. 

Meanwhile, they could sense that I wasn't very happy because I wasn't doing something I really enjoyed. 

One fine afternoon, my parents sat me down and said to me full of love, "Son, I know you mean well. You see us growing old. You want to ensure the business that we set up can continue.” 

My dad continued, “But we want to tell you that when we decided to borrow money and send you to the United States to further your studies, we didn't expect you to return back to Langkawi to take over the motel business.”

“Education is the best investment we can give to you. With your education, opportunities open up to you. We just want you to be happy in life. “

“If this motel business is not something you enjoy doing, don't force yourself. You will be unhappy. When you are sad, we are sad too. Therefore, just go out there and do what you enjoy most. Live a happy life. Don't worry about the motel business." 

I was so moved by my parents’ honest sharing with me. I felt so touched for their deep understanding, for their love for me to be happy. 

After some serious thoughts, I knew I would be miserable staying in Langkawi running the 22-room motel business (my mom closed down the restaurant portion) for the next ten or twenty years. I felt like whatever I studied in the States may go to waste. I wanted more exposure in life. I wanted more experiences in life. Hence, I moved down to Kuala Lumpur to look for jobs. 

I eventually settled down in Kuala Lumpur and worked as an employed staff at nine-to-five jobs ever since until I retired at age 49. After twenty six (26) years of operation, my parents eventually sold off the family motel business in 1994. They retired and moved down to Kuala Lumpur to be closer with my sister and me. 

Have I ever thought of quitting my nine-to-five jobs to start my own business over the last 27 years? Yes. Many times over, indeed. There was a deep desire in me to be own my own. 

Somehow, my dad’s good piece of advice about my unsuitability to business gave me a wake-up call every single time I wanted to venture into own business. 

After a while, I have come to accept the fact that perhaps being employed in a nine-to-five job is what I’m destined to be. Perhaps I’d be much happier as an employee instead of entrepreneur. 

I knew by not being an entrepreneur, I wouldn’t be able to earn unlimited big bucks. By being employed working for others at nine-to-five jobs, I started to worry whether I could earn enough, save enough from my fixed monthly pay cheque to retire one day. 

 

Possible to achieve financial independence from your nine-to-five job?

Today, I am happy to testify that it’s still possible to achieve financial independence without being an entrepreneur. It’s still possible to make enough from a nine-to-five job to retire early.

I have made it without having my own business. I have made it through working for other people. And yes, it's absolutely possible to save enough for your retirement from a nine-to-five job.

Let's revisit Malaysia's income classification according to Report of Household Income and Basic Amenities Survey 2016 jointly conducted by The Statistics Department and Khazanah Research Institute:

Class	Classification	Average	Median	Range
Upper Class	Top 20% (T20)	RM16,088	RM13,148	>RM9,619
Middle Class	Middle 40% (M40)	RM6,502	RM6,275	>RM4,360 -RM9,619
Lower Class	Bottom 40% (B40)	RM2,848	RM3,000	< RM4,360

Do you think all entrepreneurs are successful? 

Do you think all entrepreneurs fall into the upper class (T20 top 20%) income group earning an average income of RM16,088 a month or more? 

I am sure you have come across many small business owners, mama papa shop owners, who earn much less than that. 

Perhaps they may fall into M40 and even B40 income group, making less than RM10,000 a month. 

Let's flip the coin and look at those employed working full time in a nine-to-five job.

Do you think all of those employed working for others in the work force fall in the M40 and B40 income groups, making less than RM10,000 a month? 

Or perhaps you may know of some personal friends, colleagues or managers who make more than RM16,088 a month, falling into top 20% of the income group? 

The reason I want to share this with you is to prove to you that no matter you are an entrepreneur or working in a nine-to-five job, you can still fall into any of the three income groups. 

And even as an employed staff working for other people, you still can be in the top 20% income group making a lot of money and retiring early. 

Yes, you don't need to run your own business to make enough money to retire early. 

You too can make enough money working for others to retire early.

This is exactly why I have written this book. 

This book is written specifically for the 15 million employed persons out there in Malaysia and many millions more employed persons worldwide.

This book is written specifically for those who are striving to make enough money from their nine-to-five jobs to retire comfortably and live life fully one day.

If you are one of the millions employed persons, just like me, I hope this book can help you through my personal journey to financial independence.

SECTION 2

 

INVEST IN YOURSELF AND YOUR CAREER 

 

“The best investment you can make, is an investment in yourself…

The more you learn, the more you’ll earn” 

Warren Buffet

 

F I L L

Financial Independence, Live Life 

 

achieving financial independence from 9-to-5 job before 50

Book manuscript written in 2020 & blog articles published in 2021 by Vincent Khor

Photo by Van Tay Media on Unsplash