Loyalty as a virtue carries many interpretations today. For instance, individualism, or prioritising the self, is said to be very important in the West. If this is true, then loyalty to self-interests would be how individuals practice the value. In the East, priority to the family is said to be more important than individualism. In this case, loyalty to the needs of the family becomes the value that is practiced.
When it comes to work and money, it is interesting to see how different generations practice loyalty in their work culture.
Kodak, the famous technology company in the USA was a leader in the photographic film industry for about 100 years. Due to its 90% market share of photographic film, the company was loyal to the technology that had made them a dominant leader. But this kind of loyalty did not pay off. When the world advanced into digital photography, Kodak was left behind, and in January 2012, they filed for bankruptcy protection.
The generation growing up in the 21st century has a slightly different approach to loyalty. This is the millennial generation or Gen-Y (generation Y).1 In their work culture, loyalty to a cause or an inspiring boss is more appropriate than loyalty to a company.2 This explains why employees from the millennial generation can easily change jobs and move to a different company.3
This characteristic is similar to what is practiced by millennial employees in Malaysia. 98% of local millennial workers say that they give their loyalty to mentors whom they respect.4 They will also show loyalty to employers who have strong corporate responsibility values.5 This generation claims that they want to be financially secure, but are not sure where or how to find a trusted source who can guide them. They are looking for who they can be loyal to.6
What about women? How do they manage loyalty in finances? On a general note, women are said to be more loyal to people than men are. This would imply that women with financial strength would use their resources to meet the needs of those they are loyal to. Should women follow this generalised view about them? How should women exercise the value of loyalty in their finances? Below is a simple five-step plan that they can follow:
• Firstly, in order to make value-based decisions in life, they need to be loyal to themselves. They need to put aside 3%-5% of their monthly salary so that they can secure themselves as the asset-maker. Only when this is done will they be able to be loyal and help others who are important to them.
• Secondly, they need to be loyal to their spouse. Both the spouses need to build up their joint sinking fund; from 1-month to 3-months to 6-months worth of a salary. Being diligent in accumulating reserves will help both husband and wife to be loyal to their marriage vows which say ‘for better or for worse’. Risk-management is important so that the couple can then face economically difficult times, or when the woman’s spouse fails to get a promotion or is
• Thirdly, women have to be loyal to their children’s educational future. Saving up for phase one (basic primary and secondary education) is relatively easy, but what about the children’s tertiary education? An average requirement for three years of studies in a local private University amounts to RM 65,000 and this is only phase two.7 Phase three would mean considering the children’s overseas education plan. Loyalty for their entire educational package is necessary.
• Fourthly, women should practice filial loyalty. However, being filial with wisdom is more important. While taking care of aged parents, women must remember to close their own financial gaps as well. A wise suggestion is to invest in a medical card for aged parents. In this way, a woman need not have to mortgage her home or sell her assets when her parents are hospitalised. Although many women may face the reality of being a ‘sandwich’ parent who takes care of both children and her aged parents, exercising prudence in loyalty is a financial virtue.8
• Fifthly, women should heed the cry of the poor and the needy in their community. The people living below the poverty line in Malaysia are 3.8% of the population.9 Families in this group can have a chance at improving their socio-economic status when generous people show them loyalty. There are many avenues to help the poor, and women can choose one where long-term returns can help generate income for the next generation.
This simple five-step framework can help women embrace loyalty in their practice of sound financial management.
2. Giang, Vivian. “Here Are The Strengths And Weaknesses of Millennials, Gen X, And Boomers.” Business Insider. http://www.businessinsider.com/how-millennials-gen-x-and-boomers-shape-the-workplace-2013-9IR=T&
3. Article from Business Insider, 12 Sept 2012
7. This estimate is taken from a 3+0 Sunway University tertiary programme
9. Economic Planning Unit and Department of Statistics, Malaysia, 2010.
This article was first published on 10 January 2018.
Read more: High Net Worth Women and Personal Finance