Plan for 2016

After utilizing a portion of my warchest, it's time to wait for the kill for the remaining portion of my warchest. It's not easy to look at your portfolio and see it decimated week after week, but I think I took a depression and several years thereafter to get the lesson that the market is trying to teach me when I paid my tuition fees involuntarily. These are lessons that have to be taken eventually. Life has a habit of throwing you obstacles when you think that everything is going smoothly. Learning to take things in stride, especially when you can do nothing about it, is an essential skill.


Let's focus on the things we can do. I'm more worried about my job if the bear market becomes protracted. If we go by the rule of thumb of the market leading the actual economy by 6 months, then we might see a bad situation for SG51. Will my jobs be affected? Since that is my main source of income, that is also my main source of worry.


Here's my worry:

1. Harder to get new students
2. Bad debts for existing students
3. Reduction in fees chargeable


1. Harder to get new students

I think given the often toted resilient nature of the education industry, it might be a while before I can feel this effect. In the past few recessions, I did notice a slowdown in the intake towards the ending phase of the recession, not the start. I guess when people reduce their expenses, their child's educational needs are still considered needs and not wants. It still requires constant effort to keep on marketing and looking for new students year in year out, so I'll continue doing that. I think I'm better trained than most to do this, because every year I have to find new students anyway as my graduating students leave. I should be able to replicate whatever I've done in the past 12 years to do this.


2. Bad debts for existing students

I only have bad debts for the first 2 years of my career. After I implemented some measures to reduce my risk, this had come down to zero. Still, with a possible recession coming, then I will have to step up my measures. For new students, perhaps I will have to start my practice of giving less credit and asking for payments from monthly to bi-weekly. Also I'll collect fees in advance whenever possible, so as to reduce my risk of non-payments. I should be able to handle this aspect from past bad experiences.


3. Reduction in fees chargeable

I suspect that if the demand drops, I might have to reduce the fees somewhat to raise the demand level. That should be the last resort. The better way is to group students together, so that each student pays substantially lesser amount but I get to earn a higher fees per hour. Win-win for everyone. I remembered that a student had to ask for a reduction in fees because the father got retrenched in the last round of recession. I can't remembered whether I took a reduction (knowing myself, I think I did), but now with my own classes conducted at home, I can do a few tricks to protect myself. Grouping is one way. For students whom I am going over for lessons, asking them to come over for a fee reduction is also a great alternative. What I get in lesser fees can be translated to more time and less effort needed to get over there.

Having said all these, I also need to increase the range of services that I 'sell'. I have to upgrade my skillsets to increase the range of modules/subjects that I can teach. This is why I'm very glad to be able to teach new modules/subjects this year. I'm currently handling one IB student with very weird option topics. Usually the option topics will be statistics, which every A'lvl student are taking anyway. But this particular student is taking discrete mathematics, which I've never studied formerly before. Reading up intensely now (and neglecting my 52 books challenge for the time being) so as to prepare myself for possibly wider and more comprehensive range of modules to teach. This is on top of 2 university modules that I could be teaching to 2 students. One is one statistics, matrix algebra and differential equations and the other is math for econs and statistics again. Which means more reading and studying.


What am I doing all these for? To secure my income! I realise that for now, and likely for the next 15 yrs, it's going to have far more reaching consequences that my investments could ever do.


The underlying conditions for all these will be shattered if I do not have the health to support it. We think that health is always a given, until it is lost. If you've ever had a bad case of flu, whatever big plans you have for your career will have to take a backseat while you just really want to lie in bed and sleep. As such, the focus will never ever be off on health. This year, I'm trying to eat cleanly and also continuing my spiritual practice of meditation. Every alternate days on weekdays is going to be fruits for lunch. Halved my portion of rice too. Everyday except Sunday is a rest day for my body, while everyday I have to do some pullups or pushups. I'm trying to kickstart a jogging habit too and I hope to do so by end of this month.


Let's go.