Reflections on homelessness in the US, succession planning and retiring overseas

SINCE the late 90s, I have been to different parts of the US for work almost every year. I recently returned from a two-week business trip to San Francisco, Dallas and Austin, and would like to share my thoughts on money, business and life.

On homelessness in the US

While walking along the streets in the three cities, I witnessed homeless people everywhere and the stench of urine was on almost every street. The poor souls were begging for money, bathing themselves near water fountains and in public toilets.

In one instance, I was in the toilet at a public library, and it was full of homeless people. The library even stationed a security guard permanently to make sure the homeless don’t use the basins to wash themselves. One was hauled out for trying to do so. It was a really sad sight and the worst I have seen in all my visits to the US.

According to a December 2023 report by the US Department of Housing and Urban Development (HUD), 653,104 Americans experienced homelessness. This was the tally on a single night in January 2023. That figure was the highest since HUD began reporting on the issue to Congress in 2007. This has also caused shoplifting incidences to rise.

In one of the malls I visited, I saw queue stand barriers in front of the shops and security guards screened shoppers before allowing them inside. They turned away the homeless trying to enter supermarkets. In a Lululemon store, I overheard staff discussing items being stolen off the shelves the day before and saw a security guard giving chase to a shoplifter who tried to steal a bag. Inexpensive items such as shampoos were locked behind glass cabinets to prevent theft.

Scholars, healthcare workers, and homeless advocates in the US agree that two major contributing factors to homelessness are poverty and a lack of affordable housing. While we are grateful that Singapore is far different from the US, we should never be complacent. As housing becomes more expensive, there are genuine concerns among young people (my children included) that they may not be able to afford an HDB flat one day.

Even if they can buy one, they worry that it would not leave them with much disposable income to save for the future and live a reasonable life today.

If you are contemplating buying a house, buy one that you can afford to pay off as soon as possible so that you always have a permanent abode. Contrary to many of my peers in finance, I do not believe in debt. While I understand the power of leverage, I believe more in the peace of mind that comes from being debt-free. As a guide, your total monthly debt repayment, which includes all loans, should not be more than 40 to 45 per cent of gross income.

Joblessness is also a contributing factor to the homeless situation in the US, and it is also a common concern among young adults in Singapore. My daughter graduated from university in December 2023 and has not been able to find a suitable job. Of course, she might be able to find one if she accepts any job, but I don’t think that would make her happy.

She has decided to intern at a global advertising agency where she can learn and apply what she has studied. But at some point, she would need a full-time position to earn enough to support herself. To those of you still looking for that preferred job, don’t stay jobless for too long. Do anything that will get you closer to what you ultimately desire to do.

As for the rest of us, we should always stay relevant regardless of how senior we are. This way, we will never fear losing our jobs and not being able to find another one. Having a shelter over our heads and a job that gives us income will not only meet our basic needs but also give us dignity and purpose.

Lack of succession planning among US wealth advisory firms

Over the years, I’ve visited many successful wealth advisory firms in the US. One thing that stood out for me is that despite having achieved business success, many of the firms do not have succession plans in place. Having a succession plan means:

• Identifying a second generation
• Having a development plan for the successors
• Investing in the firm for future generations

One of the firms I visited had a five-person team managing US$1.3 billion of client assets, and the founder is 56 years old. They have a net profit of 65 to 70 per cent of their revenue. That sounded impressive to some, but to me, it means that they are not investing for the future. They are just maximising their wealth today and for themselves.

With no succession plan, the firm is likely to close when the founders retire. It will also be difficult to sell the firm with no successors to run it, and most importantly, the clients will not be taken care of. In the work that we do for our clients who own businesses, we observe the same situation in Singapore. Many business owners do not have a succession plan. So, if you are a business owner, for your own sake, for your staff and clients, have a succession plan in place.

On retiring in a foreign land

There was a time when I thought about retiring in another country where there is more space, more nature and a better climate. But with each passing year and after this US trip, I’ve found it harder and harder to imagine living elsewhere. When I am overseas, I find myself not coping very well with the weather, food, culture and most importantly, the loneliness of not being with “my people”.

One of the definitions of a good life is “living in the place you belong, with the people you love, doing the right work, on purpose”. My family and friends are in Singapore. My heart is in and with Singapore. I find that the work I do and want to do in the future is in Singapore.

It would be hard for me to be somewhere else – this is my current thinking. It may change in the future but for now, I hope to age with my friends and witness their demise and for them to witness mine.

You may feel differently, but before you decide where you are going to retire, ask yourself – where is the place you belong, where there are people you love and who love you? Your decision will impact your loved ones.

The writer is CEO, Providend, South-east Asia’s first fee-only comprehensive wealth advisory firm