Chinese New Year (25 January 2020) is just over and you have probably seen or heard a lot of “Gong Xi Fa Cai”(or the Cantonese version “Gong Hei Fat Choy”) lately.
You may be surprised that this standard festive greeting has nothing to do with “happy new year”. The phrase is formally translated into “wishing you great happiness and prosperity”, and literally, the words mean “I hope you will become rich”.
And this is not the only thing associated with wealth during the Chinese New Year. Some of you might have also noticed the red packets (with real money inside) that are given out as gifts, and the God of Wealth that often appears in celebrations.
Looking at these symbols for the most important Chinese festival, it is easy to get the impression that money has a significant role in Chinese culture.
What enforces the impression is the display of ostentatious wealth by many Chinese people. For example, their endless love for luxury products.
In 2018, the “flaunt your wealth challenge“, which was odd to many outside China, saw staged photos of people falling out of fancy cars with their luxury goods spilling onto the floor. The challenge went viral in China, sparking over one million posts on Weibo in only two weeks. Overseas Chinese soon picked up the trend, generating more than 100,000 similar posts on Instagram.
“Chinese people all love money!”
A few years ago, a European expatriate living in Singapore shared his observation with me: “Chinese people all love money.” Though it was said with tongue in cheek, I wasn’t surprised that was how Chinese-ness is perceived by foreigners.
The thing is Chinese people have a diehard habit of saving, which created the impression that they cling to money. The habit is passed down from generation to generation and deeply ingrained in Chinese people’s mindset, especially among the old generation. Even in rich Chinese societies like Singapore and Hong Kong, some elderly still stash cash in tin boxes these days.
The art of saving
Saving money involves two aspects. One aspect is the need for higher income. This explains why so many Chinese parents want their children to become lawyers, doctors or engineers.
The other aspect is the requirement for less spending. In the old days, that meant frugality. The younger generation now of course live richer lives and are more materialistic, but they have all been taught since young that having their own savings and thus the ability of self-subsistence is a virtue.
Youngsters are not necessarily frugal as their parents, but they have a strong economic sense and are very practical spenders. This is exhibited through their relentless pursuit of bargains and seeking the maximum value out of the money they spend.
This may sound like a stereotype: If you ask the street vendors in popular destinations for Chinese tourists, such as Phuket or Bali, the chance is they can tell you a story or two about Chinese tourists’ fierce haggling.
Even Chinese consumers’ love for iPhone – one of the most expensive phones in China – demonstrates their value-seeking characteristic. If an iPhone is the best product that shows their social status, then the value of the phone is worth the price.
Why Chinese people care so much about savings?
Unlike Australia or other western countries, there is a lack of social safety net in Chinese societies, particularly China. There isn’t such a thing as unemployment benefit. The government doesn’t give out grant to home buyers. Limitations to medical coverage abound. Minimum wage standards vary in different regions and are often ignored in practice.
All this means, Chinese people are mostly on their own. They have been instilled a deep sense of responsibility to take care of themselves and always be prepared for rainy days. That’s why they understand the importance of having their own savings.
Singapore, the 3rd wealthiest country in the world, seems to be different in some ways. Singapore provides its citizens with much better welfare compared to China. There is housing grant for lower-income families and medical coverage for a wide range of medical expenses.
However, all these benefits are based on one condition: Singaporeans need to have a job that generates stable income of their own in the first place, because the benefits are tied to Singapore’s Central Provident Fund (CPF).
CPF is a mandatory savings system for Singapore citizens and permanent residents. All working Singaporeans and permanent residents are required by law to make monthly contributions to their CPF, which are deducted automatically from their salaries. Their employers pay employees additional CPF on top of their salaries.
Different from Australia’s Superannuation, CPF can be used for housing, medical expenses, children’s education and government-approved investment. The balance in CPF can only be withdrawn at the age of 55 (as retirement funds), unless there are special reasons.
In a nutshell, CPF is the state-enforced act of saving in Singapore.
Our shared love for money
Chinese people are careful with money. We save where we can and probably do so more than other people. But we are not obsessed with money.
Besides, who doesn’t love money? It is not just a Chinese thing.
About minimum wage
Hong Kong’s minimum wage increased to HKD37.50 (AUD7.22) an hour in 2019. But study pointed out it is still lower than the desired hourly rate (HKD54.70) that ensures a basic standard of living in the city.
In Singapore, the idea of minimum wage doesn’t exist. Highly skilled full-time employees can make a comfortable income, but there is no guarantee for part-time workers.
In early 2000, I did some part-time work by waiting tables at big hotels and chain restaurants in Singapore. My work was paid SGD6 (AUD6.44) per hour. That hasn’t changed much in the past 20 years. Singaporean kids today are paid around SGD7-8 (AUD7.5-8.5) for an hour’s part-time work.
In Australia, which has the highest minimum wage in the world (AUD18.93 an hour), the same type of work is paid nearly AUD20.
The Tip Box 