By Khalid AlAmeri (@KhalidAlAmeri)
Whilst visiting Abu Dhabi during my university days, my friends and I were relaxing in a tent set up outside when a shiny new Range Rover pulls up into the driveway. A young man jumps out the car sporting a freshly pressed kandoora & a crisp white-checkered headgear. As he walks into the tent the crowd stands up to say their hellos and it is then that I recognize him. ‘Ahmed!’ I yell excitedly. I was happily surprised at how one year could change someone; new car, new look, and the accessories to go with it; one could not help but notice the shiny watch he took off when we were about to dig into a midnight meal.
Let me give you a little background on Ahmed. Ahmed has been a friend of mine since high school, upon school’s graduation he went to a local university for a year before he decided to drop out and take up an administrative role within a governmental department. Being 19 years old and on a government salary with no expenses leaves a young bachelor with a lot to spend, so Ahmed goes out and buys a car that could have easily bought him an apartment back in the good old days.
Then, on another evening, Ahmed gets dropped off at the tent and we ask him where his fancy new car is, “I got a flat tire” he replied, “and it costs 2,500 dirhams to be replaced”. As almost half his salary had already gone to car payments and with one week left till payday; Ahmed could not afford to change the tire.
The moral of the story, “do not spend what you cannot afford” and it was not until reading an article titled “locals spending on luxury items and building up debt” in a local newspaper that Ahmed’s story came storming back to me. The article talked about working youth taking out loans for luxury items such as cars, jewellery and high-end mobile phones; you know the brand I am talking about and I know what you are thinking. Why? Well according to those interviewed it was either to fit into a certain social circle or to seek attention. Really? Has our rich society become so cheap that they now judge people on the varying price tags of the products they drive, wear and carry? Do the individuals taking debt to fit into these circles realize that they are merely putting a price on themselves rather that giving people the opportunity to see the richness in their character?
Now looking at debt from a different perspective it does have its upsides, a friend of mine, let us call him Mohammed, works crazy hours at his ‘9 to 5’ job while in parallel he is trying to start his own private business. Mohammed is relaxed in saying that he is up to his eyeballs in debt which was necessary to pay for his higher education and provide the money needed to jump start his business. In his case, rather than take out debt to fake a better life, he is using debt to create a better life both for him and his loved ones.
Moving on to banks, who make it so easy for young executives to take out loans to finance their high-end lifestyles, can you imagine a bank offered me AED 500,000 preapproved car loan just one month after buying a car with their financing? Shocking I know! But that is guerilla marketing for you. So where does it all end? When does a bank say enough is enough? Fortunately through Central Bank involvement early this year a limit on personal loans in the country is now set at a limit of 20 times the monthly salary. We can only hope this somewhat limits the financed high-end lifestyle enjoyed by so many.
Believe me, I am aware of the materialistic world we live in, where respect is earned by the way you dress or the car you drive. What saddens me is that while majorities of our young workforce are solely focused on materialistic ambitions, our leadership is working hard to realize a beautiful vision for our country’s future based on economic, educational, and social development.
I cannot help but think of our role model the Late Sheikh Zayed who created great monetary wealth for our country and its people but chose to live a modest and traditional lifestyle. Through his international contributions, charities and development initiatives; Sheikh Zayed left a legacy in the hearts of people around the world that will live on far beyond our times.
So when you take out that loan for a car you can barely afford or the latest Vertu phone, think to yourself “how do I want to be remembered”? For ‘debt financed’ materialistic lifestyle you led or for the legacy you left? The choice is yours.
May 2011’s issue: