How to Be Rich with Little Money

Would you like to learn how to become rich with little money?

Being rich is relative. It can mean different things to different people. When we say rich, we mean having basic financial independence and the peace of mind that comes with it.

We do not mean being filthy rich – certainly not the ‘I can buy a giraffe’ rich.

What is Financial Independence?

True financial independence means having enough money to last the rest of your life without having to work a day.

But before getting there, let’s explore some of your motivation for achieving financial freedom:

  1. Would you like your debt to finally be SGD 0?

  2. What would paying off the house be like? Think about how much money would be freed up for other uses.

  3. Do you wish to retire earlier than the conventional 55 to 65 years? The average retirement age in Singapore is at 62. Perhaps you would like to shoot for retirement at 50 to 55 or even earlier.

  4. What would it take to break the ‘paycheck to paycheck’ circle?

  5. Do you have some student loan balances? Would you like to pay it down?


As you can see, circumstances and motivation vary from person to person.

Another point to note is that even though the path to wealth is well-trodden, few can recognize it, let alone walk down it. Few people make it a priority to learn how to become rich early enough in life. Over here at The Smart Singaporean, we think it is an important topic to handle as early as possible.

Being rich is a mindset. We are here to teach you that mindset. We started this blog specifically to shine light on this mindset. Why? Because mindset is everything. Millionaires think, act and spend like millionaires

They have figured out a secret. A law. An approach to life that ensures their net worth climbs – slowly sometimes, but surely. 

Can anyone do it? Absolutely. Yes, they can. And you can too. However, you have to be ready to put in the hard work and be better than the average citizen.

But What does AVERAGE mean? It can be shocking.

If you are from the average Singaporean household, you may not be saving much at all. It is a well observed and worrying trend. Are you average? To satisfy your inner ‘kaypoh’, here are some questions you can ask yourself:

  1. Have you saved at least 10 percent of your gross income?

  2. Do you have an emergency fund NOW? How much is in the stash? Would it withstand an actual emergency or a recession?

  3. Singaporeans love cash. How much of the savings is in cash? Is it sitting around as liquid money, or earning some interest?

  4. How much interest is too little?

  5. Are you losing money? There are two somewhat cliche rules to wealth management. The first rule is never to lose money. The second rule is: if in doubt, to refer to the first rule.

These questions might be uncomfortable for you to answer but don’t worry. Part of this journey is to face hard questions head on instead of avoiding them.

Building wealth is about navigating away from things that threaten your financial well-being. You do not want to be one of those people that live paycheck to paycheck, oblivious of the hidden dangers that come with this way of life. 

Once you have taken stock of your present state of financial affairs, it’s time to take action.

VERY IMPORTANT: As you read through today’s blog post, remember that having a millionaire mindset and building your wealth is NOT about having a million dollars or more in your accounts. Rather, it is about changing your approach to how you handle money.

It means having fun along the way. It means achieving peace of mind for your future well-being as well as your children’s.

Once you unlock your mindset to the possibilities and work towards your potential, so much more will be made possible.

Your purpose will be more defined.

We make money for a reason and it extends beyond ourselves. Maslow’s hierarchy of needs culminates in self-actualization. This is the point where you look back and give back to society. 

In the end, our impact is measured mostly by how many lives we ‘touch.’ Some of the best ways of achieving real impact include helping underprivileged families, the ex-offenders and animal shelters out. 

See also: Take the recession-proof quiz.

Getting Started - It All Starts with a Plan

All journeys to financial independence start from a plan – a clear visualization of what the future should look like. 

And It is imperative that you start NOW. Putting it off until tomorrow is the first key mistake because tomorrow never comes.

Many people postpone important things like saving for retirement because retirement seems far away.

To make the matter worse, the effects of not saving for retirement are neither apparent nor felt upfront. One of the biggest problems you could solve now is overcoming the inertia that makes you put off financial planning.

Start with a goal. People who set goals are more likely to achieve success compared to those who do not set goals. Since most plans of getting wealthy seem insurmountable, it is important to break them down into simpler achievable goals. Note down the following:

  1. What are your life goals? List them down.

  2. Do you have a plan which connects the said life goals to your future reality? Please note down this plan.

  3. Pick the first life goal and break it down to smaller parts. You may want to call these parts fancy names like ‘phase 1, objective 1,’ etc
  4. Do the same for your other goals. Next, arrange all the goals into an order of appearance. This will become your Master Plan

  5. Start working on the first phase of the first goal. Set a time limit. For example, ‘I should have paid down the SGD 525 owed to X by the end of this month (name the month, and perhaps the exact date).

  6. Gamify the process. Make it easy enough to stick to and challenging enough to strive for.

  7. Find small ways of motivating yourself towards accomplishing the goals. Be friendly and compete with time.

See Also: Watch the Property Masterclass

How to Become Rich Early by Eliminating Debt

One of the most successful habits of individuals who become rich early is eliminating high-interest debts. These debts usually have an extraordinary clutch over your money, and it should be a priority to pay them off. 

To ensure that you do not lag behind, it is important to make the minimum monthly repayment for each of the loans. If some money remains, ensure that you pay off as much of the loan’s principal as possible.

Once you clear the smallest loan, focus on eliminating the next loan – with the money freed from paying off the smallest loan. Work your way up each of the loans until you remain with the biggest loan. Usually, you start by paying off high-interest credit cards then work your way through the loans until you hit the student loans and the mortgage. 

Always keep in mind that the end goal is to be debt-free, so that you focus on things that matter, like investing in yourself, on your spouse or the kids’ education. Being debt-free earlier in life will also unlock the advantages of compound interest to your favor – rather than being a money-maker for the lenders, you will be your own money-maker.

Here are some more tips to grow wealth with good debt management habits.

  1. Most or all of the extra money should go towards eliminating debt. If you got a raise at work, one of the best uses of that money would be to pay off debts. The same applies to refunds you get, tips or money from selling stuff.

  2. Only use credit when you really need it. With credit, you have to be brutally honest with yourself. Do you really need it?

    Simply because the bank offers an overdraft limit does not mean that you should use it. The same applies to credit card limits. Under no circumstances should a trip to the mall contribute to maxing up the credit card.

    Avoid adding debt to your life, even after you have paid it all off.

  3. Decrease your spending. Less spending means there is more money left over to cover unexpected expenses so that you do not need to take on debt for that.

    Rich and wealthy individuals do not necessarily spend significant percentages of their net worth on exorbitant items like fine dining and golfing, as portrayed by the media. The glamorous life comes at a steep cost that would obliterate the millions in less weeks than the letters in the word ‘millionaire.’

    In fact, many of these people get to where they are by being frugal and safeguarding their wealth.

Budget, Budget, Budget. And Budget Again

And again! We all know that budgeting can be tough to pick up. However, this is a habit that can make a world of difference for your wallet. While spending unbudgeted money is very enticing, it is similar to walking around with a hole in the pocket.

Impulse-buying takes over and before you know it, the gains you made paying off the debts would be obliterated by new debt to cover for excess spending.

And so, you need to create a budget. Make one with as many categories as possible, so that you can see where your money is going. It is easy to get derailed by spending outside the budget, especially as you get started with it, but do not be discouraged. Keep adjusting the budget, to ensure that you do not spend the money you don’t have.

Note each and every transaction. Do not get tired of this. It is one of the best and most successful habits for people who have figured out how to get rich early.

Have Fun - Seriously. Think of the Children!

To achieve your goals, it really matters that you have fun along the way. Otherwise, as famously said by Richard Branson, what’s the point?

The key here is to go for affordable ways of having fun. The kids do not have to bear the brunt of the aggressive money management methodology either. To accumulate wealth, you need to figure out how to balance having fun, spending time with the family, saving and investing and lay out the rules earlier on.

Better yet, it would sure be nice if the family could approach the financial journey as a team – it teaches the young ones how to handle cash, while simultaneously bringing the family into the comfortable enclaves of financial security.

Save Enough for an Emergency, And Then Some

The rule of the thumb, before eliminating debt, is that you should have at least $1,000 for emergencies. This would ensure that your other areas of financial security are not derailed.

After you pay off the debt, it is time to focus on growing the emergency stash. The idea is to have a little bit of the money in cash, while the rest goes to a relatively accessible, interest-paying account. That way, your emergency fund will keep growing as it waits patiently (for the inevitable emergency).

Secondly, you must keep replenishing the emergency fund if you draw money out of it. This means that you are prepared for the next emergency, should it come abruptly. Better still, you should aim for a stash that is good for about six months of expenses.

It can be locked as a fixed deposit in the DBS, OCBC or UOB banks. Even better, you could stash it somewhere where you get more than 20 times the national average, using Betterment.

Could you survive on $6,000 for six months? What about $10,000? Let us know!

Save Towards the Kids’ College Education

This one is simple – if you are edging forward towards your financial independence, how about helping the children in the process? You can give them a head-start by saving towards their college education.

Sooner or later, they would be thankful to start life without the burden of student loans. They too will be more likely to inherit the gift of hard work and getting to become rich early, thanks to your efforts.

Invest, Preferably in Real Estate

The next logical step after eliminating debt and saving up for emergencies would be putting your money to work. Unlike you, your money never sleeps, working day and night to bring you more money.

The earlier you start investing, the better.

Do you want to earn money with real estate? Get to know the 10 steps to creating wealth with property even if you are not a millionaire. 

Other great methods of investing involve putting the money into the following financial instruments:

  1. Stocks
  2. Mutual Funds
  3. The Singapore Government Treasury bills
  4. The Singapore Government Treasury bonds
  5. Singapore Savings Bonds (or SSB)
  6. Top-ups to the CPF, beyond the compulsory amounts. You can add these to the special accounts (SA).
  7. Fixed deposits
  8. Insurance company savings plans.

Start Creating One Extra Stream of Income, Then add Another One

If you are starting out, you may want to plan on how to add more income streams to supplement your current earnings. The trick is to make use of your extra time.

One of the best ways of doing that is investing in personal and professional growth. You could, for example, learn a useful skill which would make you money on the side. Perhaps you could start a small business.

Once you figure it out, you can grow this venture to a point that it brings in a liquid stream of income. Over time, you can add new ideas and more income streams, so long as the earlier streams of income are still viable and passive.

Frugality 101

As mentioned above, being rich does not mean spending lavishly on expensive stuff. In fact, some of the most screaming, showy consumables in life are easily financed by debt, in the classic ‘spending money you do not have to impress people’ mantra.

Instead of going for the trendiest tech, you can shave off two-thirds of the cost by going for cheaper or older alternatives.

Frugality is a key millionaire mindset. Take our word for it. Money speaks, but wealth moves silently.

Giving Back to the Community

Once you have:

  • Paid off all the debt (including the house),
  • Saved enough money to cover sudden emergencies
  • Invested generously to have additional, sustainable income,
  • and saved for the kids’ college tuitions, 


You may arrive at the point where you do not need to work a day in your life. What now?

Perhaps it is time to give back to a cause you care about. Now, you are living an impactful life – you have reached the point where you could leave a positive mark on someone else’s life. 

You will be one of the people in our society upon whom fortune has smiled. You could help out the less fortunate – the ex-offenders, animal shelters, that struggling single parent with a brilliant kid. You can now leave an impact, having mastered how to become rich with little money.

If you would like to find out how you can create an immediate impact, send us a shoutout today and let’s talk about it! 

Leave a Comment

Your email address will not be published. Required fields are marked *