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Talk About Airline Services

If you live in Malaysia or Singapore and travel frequently, most likely you have taken flight of both Malaysian and Singapore airline. As the name indicated, one belongs to Malaysian company and another to Singaporean.

This year I have a few chances to travel back and forth united states via both airlines. I travel to Texas, through both airline, the stops are differents. MAS stops in Taipei, Los Angelas and the subsequently reach Dallas, Texas. While for SIA, The flight will stop at Hong Kong, San francisco and then Dallas.

While both airlines offer good in flight service in this international route, however there are also many things our Malaysia airline so lacked behind to it's competitors..
Flight Experience

First of all, when entering the SIA aircraft, I find the aircraft condition is so much better than that of MAS, I won't go into compare different type of aircraft make as MAS is using Boeng while SIA is using Airbus. However at first look, SIA gives a cleaner look, probably the interior is better maintained with neat cushion upholstery, and comfortable mood of lighting.

Besides, there are many little extra seat features provided by SIA. anyone who used to travel long distance would find these little things add up to a lot of values. Things like, a much bigger LCD screen, a USB port  to charge handphone or PDA, additional seat pockets to put your stuff like wallet, passport, handphone, Ipod, etc. More head room so you don't feel clautrophobic (Different aircraft configurations). You can't find this in MAS.

Food menu wise, in my opinion SIA offers higher value meals. Aside from those very normal choices like chicken, fish or beef dishes, they do have things like salmon salad, Hagendaz ice-cream, popsicle, variety of cocktail drinks, nothing very fancy, but as passenger I know these little things will keep me coming back, after all people do like extra goodies. While the best thing I have from MAS is the so-so cheese cake or probably the small savory peanut pack (which is also offered by SIA).

For in flight entertainment, SIA is much better as well. Not only the LCD screen is much bigger, it project clear picture as well. For I used to suffer on the small blurry picture when flying with MAS. Besides, i can safely say that choice of movies is double of what MAS offers. There are many other entertainment options which I have no time to explore, but there are people who do!

Pre-Sale Experience
Recently I have an unpleasant experience in MAS online reservation web site, for those who doesn't know there is one, it is in a totally different URL which is difficult to locate through search engine, or it is rather confusing. I attempted a few times in completing the reservation but a few time my effort went to waste. And finally, I manage to make the reservation, after a few disgrunted phone calls that got no answer or not getting any helpful answer. I used up 2 days time to make a simple reservation.

Revenue Leakage
All These lead me to think, if not for MAS national carrier status, it would have gone down many years ago. First of all, I can see they lose so much potential revenue simply from their faulty online reservation system, not many customers are as patience as me, who is willing to try two or three times. In information age, if you can't be effective in your online based system, you lose out to competitors. Airasia is a good of example of competitor with their effective online reservation system. It has never give me any trouble before, if it did, it would have served more than failing me, and i bet more than half of their revenue is also generated from online reservation! Being easy to use and effective system simply add so much convenience to customer thus providing value in service even before business is transacted. In case of MAS, Service value is already being minused before the ticket is even purchased!

Management Efficiency
This article is not just a rambling about bad service or food. In evaluating a company's management effectiveness from stock investment point of view, this is how you can see their level of competitiveness: how effective is the company generating revenue (effective reservation system) , how good is their strategy in retaining customer (extra goodies here and there, more comfortable seat, etc). Is the company revoluting in economic downturn to stay competitive. During the recent downturn when a lot of European and US airlines gone down, MAS announcing losses, Airasia start to provide seat selection with a fee, while I could only notice MAS domestic flight cut cost by offering obviously cheaper food thus further reducing value of service.

Airline is a very competitive industry, with fuel price soaring to new high. Beside increasing airfare, the airline should provide more value added service so the value of service won't be diluted. Because if you can't do it, there bound to be some one more efficient who can. When this day come, it will be the change of market leader.

Action Plan to Financial Freedom (Part-3)

Financial Freedom
Financial freedom is achieved when one is able to live in his mean without earning an active income. In other word, one's passive income is more than enough to support his desired lifestyle. Passive income is defined as income earned without one actively involves in the income generating activities, while active income is income earned that requires active involvement in the income generating activities. A person who is financially freed, can choose to work or not as long as he wants but still live in his desired lifestyle - indefinitely.

In the Action Plan to Financial Security (Part-2), action plans are defined to come out with income streams that could support one's basic lifestyle. In order to be financially freed, one needs to come out with higher passive income streams that can support their desired lifestyle, freely. To be able to spend freely, one usually don't need worry too much on his spending habits and the amount he spends. However this is very subjective, to some people, to be able to spend freely, he wants to be able to buy luxuries and still have abundance of money left to support his lifestyle. While for some other people, to be able to live and spend freely don't require that high of a cost.

Action Plan to Financial Freedom

Since to be able to live and spend freely are subjective and depend on the person's desired lifestyle, in your action plan, you need to list of the desired items and state the costs involve, such as below:

1. Upgrade to a higher range car with a monthly commitment of 1,500 to 2,000. Totally around 18,000 to 24,000 per year including higher insurance cost and maintenance fee.
2. Buy a home/condominium in a good neighbourhood with monthly instalment of 2,500 to 3,500. Totally 30,000 to 42,000 per year, including miscellaneous costs.
3. Buy the luxury items you always wanted like jewelries, watches, handbags, clothes and etc. Try to give an estimated lump sum total for these item, say 20,000 per year.

Total expense in above 3 desired items = (18,000 to 24,000) + (30,000 to 42,000) + 20,000 = From 68,000 to 86,000

These are my ideas of luxuries. If you have more desired items, you may list it down into your action plan and add to the total expenses, after all, the definition of financial freedom is very subjective from one person to another. Since this is the extra from your basic lifestyle, it also means you need additional income streams that could generate as much as 68,000 to 86,000 per year.

The same steps you need to follow in drawing out an action plan to become financially free; list out as many income stream ideas as possible you can come out with, the step-by-step descriptions, targetted income for each, deadline to realize each income stream, etc and then total up these passive incomes. It is also make sense to expand the same passive income streams that provide you the financial security. Since you have the experience and also the know-how, it will be easier to think of innovative ideas to expand those existing incomes. Below are some general ideas to improve the existing income streams:

1. Part time business - Expand the business, look for greater innovation for higher business income, or improve business efficiency and reduce cost. If the business is easily duplicated, it will be easier to expand (open new branches).
2. Internet business - open to more internet related opportunities, there are a lot of ways to improve internet business revenue. Upgrade your existing web site in appearence. Improve sales letter effectiveness. Optimize internet traffic so more people get to know your product. Create more intellectual properties/product.
3. Blogging - Enrich the content of your existing blogs by providing more informative and unique contents to attract more audience. Besides, one also can use other third party services to improve the blog's viewing traffic such as article submission to reputable sites, press release, link exchange, etc.
4. Dividend - top up to existing stock ownership, one also can increase the return in stock dividend. However, in order to largely increase the dividend return to support the desired lifestyle, investment capital is also huge, approximately half to a million.
5. Real estate rental income - acquire more positive cash flow income. Again, in order to largely increase the rental income to support a different lifestyle, one needs to acquire many more of such assets thus require more intensive upfront investment capital and time to raise the capital.

If you have successfully completed the action plan to become financially free - total additional passive income that is more than enough to cover your desired lifestyle expense. Then congratulation! you have made the first of a thousand steps to achieve financial freedom. You may start to work on the steps defined immediately. Along the journey, you need to constantly review your progress by referencing the action plan. For easier review, it is also a good idea to come up with an exhaustive check list of steps or items that are done or to be done. To end this article, I wish the best of luck to our financial freedom!

There is a saying...

~~ A journey of thousand miles starts from a single step ~~

Action Plan to Financial Freedom (Part-2)

Financial Security
Financial security is achieved when one person's total passive income is able to cover all his basic expenses. Passive income is defined as income earned even you don't actively work for it, while active income is income earned that requires active involvement in the income generating activities. People who live within financial security can live the most basic lifestyle without earning an active income, for as long as he/she wants - indefinitely.

Examples below are some of the very basic expenses need to be covered by total passive income in order to live a basic lifestyle:

1. Home and car loan plus interests
2. Transportation related cost like petro, car maintenance cost, insurance cost, public transport cost, etc
3. Food, groceries and basic home suporting items
4. Home utilities include water and power.
5. Satellite TV subscription fee. If it is your basic need, then you should include that as well.
6. Children expenses like school and tuition fees.

Of course, with a longer expense list and higher cost, it will naturally take a higher passive income to achieve financial security.

Action Plan to Financial Security
In order to achieve financial security, we need to come out with a plan on how we can build additional income streams. Below are some of the example of high level description of income stream you can start building:

1. Build a part time business during free time.
2. Start a internet business selling your own product or other peoples products
3. Write blogs to earn advertising income
4. Invest in high-dividend stocks to earn dividend, however to earn decent income through stock dividend usually require very large investment capital - approximately few hundred thousands.
5. Invest in real estate such as condominium, apartments, and shoplots to earn rental incomes. However real estate investment usually require high upfront capital as well. Zero downpayment purchase that provide positive cash flow are difficult to acquire but not impossible.
6. Fix deposit. Due to economic outlook, the FD rate is no longer attractive, at least for another 1 or 2 years. If one truly commited to achieve financial security, this method is not recommeded.

The above are my ideas of generating passive income and it is not limited to just above. If you have some better ideas, do write it down into action plan list, list down as many income stream ideas as possible. For each of the idea it is also important to state; the steps you need to take, targetted income amount for each, how long required to achieve each income stream objective, deadline, etc. When you have listed down all your income streams ideas with all mentioned inputs, total up all the targetted passive incomes. Are the total passive income streams enough to cover your basic expenses? If yes, then congratulation, you have just finished your very first action plan to become financially secured. You may immediately start taking the step one-by-one.

The next part is on financial freedom, which is the ultimate goal in our action plan...

Action Plan to Financial Freedom (Part-1)

We often dream about financial freedom, we want to and more often talk about becoming financially free. But how many of us actually do something different to achieve this dream? Without a concrete action plan, and clearly define road map, no matter how ambitious is the dream, chances of becoming financially free will almost equal to none. Without a clearly define road map to follow, one will soon forget the dream of freedom and go back to live their normal daily life. Action plan can be constant reminder serves to remind a person of his objectives, goal and estimated deadline. Besides, in journey to become financially free, you will want to review your progress against the action plan to see how much progress you have made and how far away you are from your goal.

In order to become financial free we need to know what the definition of being financially free is. Financial freedom being the ultimate goal, of course, before achieving that, we need to know the two pillars supporting the freedom; those are financial stability and financial security. The later two are the basic fundamentals of being financially free; it is like the foundation of a skyscraper that built on a strong concrete foundation, in case of financial freedom, it is built on financial stability and security. In short, in order to achieve financial freedom, we must first achieve financial stability and then financial security.

Financial Stability

Financial stability is achieved when one person is able to live his life without income for 6 months or more. Wealth is measured by time instead of amount of money you have. Take the example of a fashion designer whose monthly income of 10,000 with monthly expense of 8,000 and a school teacher who only earns 2,000 with monthly expense of 500. Who do you think live a more stable financial? The answer is the school teacher. If both person lose their job, the fashion designer who live a high maintenance life style would not live through a month to go bankrupt, but for the school teacher, with a saving of 1500 per month in minimal, he/she can easily live for another 3 months without active income. In the first step in our road path to become financially free, we need to make sure we are financial stable before we can talk about financial freedom.

Action Plan to Financial Stability:

Now think. If you have less than 6 months to go into bankruptcy without a job, you need to start doing something. Below are some typical scenarios:

1. If you are living on a mountain of credit card debt, and you can’t seem to reduce the owing balance each and every month. From you credit card bill, list out items that you don’t need to spend. Without this desire items, it is easier to pay off the credit card.

2. When you can’t seems to save even though you are not on any retail/credit card debt. This happens when you pay yourself last. In order to save, you need to pay yourself first. Every month when you get your paycheck, put aside a percentage into saving and spend the difference. An average person will do the opposite that’s why they can never save, and the worst is they don’t even know where the money goes.

In the action plan, one needs to state how much money to allocate to clear off debt every month with a deadline. Only after all accumulated debts are cleared off, one can start saving for financial stability. Subsequent action plan needs to find out total expense of one self. Since financial stability is defined to be one’s ability to live through 6 months without any income before going into bankruptcy, thus the amount of money to achieve financial stability will be total expense times 6 (months), let us call it Financial Stability Amount Requirement FSAR. Next, state how much money you committed to save every month, let call it monthly saving commitment MSC. With all these figures: FSAR and MSC, one can easily find out how long he/she needs to achieve financial stability. Simply divide FSAR by MSC. The result of calculation is the duration required to achieve financial stability, one will know exactly the date he/she can achieve financial stability.

The next part is on financial security and the action plan to achieve it…