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Shell $1 Petrol

>> Monday, October 26, 2009

The promotion took place on Saturday, Oct 24 and will run from 10am - 6pm at all Shell stations. The discount means motorists will save about 70 cents a liter.

As can be seen by the snaking queues at all of the Shell stations on Saturday, the promotion attracted a huge response and it took averagely 45 minutes of waiting time.

What has this got to do with financial planning?

This is a classic example of being penny wise pound foolish which is many people's approach to financial planning.

Assuming a full tank of 50 liters, a savings of 70 cents per liter would give a savings of $35! However, there is the consumption of petrol while idling with the air con on for 45 minutes and more importantly, that is 45 minutes of your precious time that can never be taken back.

If one can afford to drive, this savings is rather insignificant compared to the all other aspects of car ownership like depreciation of the car, insurance, maintenance and ERP/parking. Don't get me wrong, a discount is definitely welcomed, but the effort/reward needs to be assessed if it is worth it.

If so many are willing to sacrifice 45 minutes of their life to save tens of dollars, why are they so reluctant to spend an hour of their life to have their financial health properly reviewed and save them a lifetime of potential suffering. (It will not be surprising if some of them could be meeting their financial planners but only to inform that they will not be able to make it because they are stuck in the queue!)

Similarly, many also often try to save that few dollars for financial protection, taking up lower coverage or none at all, only to regret their decision when a crisis happens. Just like they are trying to save that $35 on petrol, they did not realize that the time wasted could have been better used to relax or spend more time with their families and friends. (Don't we always complain there is never enough time to this hectic society?)

To conclude, hopefully people can learn from this event and change their mindset to look at the bigger picture when it comes to planning their finances.

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