How to thrive in a messy world

IN A short span of just six years, we have been reminded of how fragile global stability can be. It began with the Covid-19 pandemic in December 2019, which disrupted supply chains and economies worldwide.

This was followed by Russia’s invasion of Ukraine in February 2022, a war that remains unresolved. In late 2023, conflict in Gaza intensified humanitarian and regional risks.

Then in early 2025, tensions escalated further, with a US tariff war on Canada and Mexico, followed later in the year by a diplomatic spat between China and Japan over Taiwan, and now rising US-Europe friction over Greenland.

The question many investors are asking is simple: How should we respond in a world that has become increasingly messy?

Philosophy of sufficiency

In the aftermath of the global financial crisis, sometime in 2010, I vividly remember walking past a McDonald’s near the Tampines bus interchange when I heard an inner voice.

It said: “Money has been used as a weapon of mass destruction to destroy many lives in the Western world. It is now coming to the East. You have the knowledge, skills and licence, what are you going to do about it?”

That moment became a turning point for us. It was the genesis of what we now call Providend’s “philosophy of sufficiency”.

Sufficiency is not about being unambitious. It is about building enough financial margin to withstand life’s uncertainties; maintaining healthy cash flow; reducing excessive leverage; and becoming resilient before pursuing growth.

It stands in contrast to the “max-leverage and risk mindset” that leaves individuals highly exposed when shocks occur.

After the 2008/09 crisis, many investors rediscovered the value of having reserves and disciplined saving – not as a way to avoid risk, but as a way to survive it.

Today, as risks become more real, sufficiency is even more relevant.

How does one practise sufficiency in real life?

1. Spend below your means

At its core, sufficiency begins with resisting the temptation to buy things we do not need, with money we do not have, simply to impress people we neither know nor truly care about.

It is about choosing, deliberately, to live and spend well below what we can afford, not out of fear, but out of freedom. When our lifestyle requires only a fraction of our income, we create a healthy monthly surplus and, more importantly, options in our lives.

Even if circumstances change – such as a job loss, a career shift, or a lower-paying role – we remain financially and emotionally unburdened. This gives us resilience, dignity and the quiet confidence that our well-being is not held hostage by external conditions.

2. Lower your debt

One of the most overrated pieces of financial advice given to people in their 30s today is that they must own a private property as early as possible. The narrative often goes like this: While you are still young, maximise your borrowing capacity and stretch your mortgage over 25 or even 30 years.

I understand the desire to live in a private property. But if it comes at the expense of one’s peace of mind, I would much rather see individuals reduce their exposure to debt at such a young age. When debt becomes overwhelming, money turns into a master rather than a servant.

In the years leading up to the pandemic, interest rates were exceptionally low, and financial institutions actively promoted premium-financed universal life insurance as a supposedly efficient way to leverage cheap credit.

When interest rates rose sharply during the pandemic years, many people found themselves in distress, unable to service the escalating interest costs. Some were forced to surrender their policies at a loss. Many lost not just money, but peace of mind.

A prudent rule is to keep total liabilities below 50 per cent of total assets, and ensure that all monthly loan repayments remain well under 40 per cent of gross income. Peace of mind, especially during times of crisis, is a precious asset that no financial return can replace.

3. Set aside proper reserves

During the Covid-19 pandemic, Singapore demonstrated the power of strong reserves; it drew on its past reserves to support public health and economic measures.

Between 2020 and 2022, the government tapped about S$40 billion to fund public health measures as well as economic and social support measures, to save lives and protect livelihoods without resorting to excessive borrowing.

This allowed Singapore to emerge from the crisis relatively unscathed compared to many countries.

The lesson for individuals is clear: reserves are lifesaving.

While traditional financial planning suggests keeping three to six months’ expenses in cash reserves, I would go further and recommend six to 12 months. This bigger buffer provides genuine peace of mind in prolonged downturns or unexpected job loss.

Even for our retiree clients, we maintain a dedicated reserve bucket to cope with unforeseen circumstances because the last thing anyone wants in retirement is to be forced to sell long-term assets at the wrong time.

Staying invested in a messy world

In the current environment, the prospect of new tariffs arising from tensions over Greenland and growing concerns over the independence of the US Federal Reserve undoubtedly introduce genuine uncertainty.

Yet, history shows that global corporations are remarkably adaptable. They adjust supply chains, manage inventory and refine pricing strategies to protect margins.

We saw this most recently in 2025, when many multinational companies successfully reconfigured operations in response to the “Liberation Day” tariffs, cushioning the impact and contributing to strong stock performance.

Diversification also remains a cornerstone of portfolio resilience. In 2025, equities in Asia (including Singapore) and Europe outperformed the US, illustrating how geographical diversification allows investors to capture returns across different regions and economic cycles.

More importantly, as the recovery since 2022 has shown, equities remain one of the few asset classes with the inherent pricing power to outpace rising costs.

Staying invested is therefore not just a growth strategy, it is a necessary hedge to preserve real purchasing power in an inflationary world.

But you can only stay invested if you practise sufficiency.

I have spent almost three decades in the wealth advisory profession, long enough to have witnessed multiple market cycles and crises – from the Asian financial crisis of 1997-1998, the dotcom bubble in 2000, and the 9/11 terrorist attacks in 2001, to the global financial crisis in 2008 and most recently, the Covid-19 pandemic.

Across these episodes, one pattern became clear. Difficult times often provide the most powerful opportunities for reset.

In contrast, prolonged good times tend to breed overconfidence, where individuals over-leverage themselves in consumption and investing under the illusion that favourable conditions will last forever.

It is usually only when uncertainty returns that we confront our vulnerabilities, reassess our priorities, and rebuild with greater discipline and resilience.

As 2026 begins, perhaps this is a good time for a financial and life reset – not by trying to predict the world, but by strengthening ourselves within it.

In a messy world, sufficiency is not about having less. Rather, it is about having the freedom to live well, invest wisely and sleep peacefully at night.

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