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Saturday, March 31, 2018

Being a sell-out

When I told a colleague that I was prepared to work all weekends in March as long as the firm was paying for them, she shot me a look of pity.

"That's sad," she said, judgmentally. "Such a sell out," she then followed, derisively.

I must say I do not quite understand.

I mean sure, the firm is not paying us double (or even 1.5 times) our usual day rates for working weekends and public holidays. But honestly, extra income is extra income is extra income.

There is no reason not to do it, especially if you were a high income earner and commanded a reasonably lucrative day rate.

I worked it out; the additional income I expect to receive for basically working four weeks straight without a rest day was sufficient to pay three months rent.  To me, this is a no brainer. If the opportunity arises to do it again the next end-of-quarter, you can bet your last dollar that I'll do it.

If that is selling out, then so be it.  I am a sell-out. But then again, aren't we all? Isn't the very definition of selling out: Doing something involuntarily for the purpose of receiving some form of consideration (in most cases, money)? By this definition, we are all sell-outs. And being the Rafflesian that I am, if I am going to be a sell-out, then I damn well take the selling-out to the next level. Never do something unless you are determined to excel the shit out of it.

Every dollar matters in the race to the FIRE. Every dollar put into the warchest is precious ammunition. The Chinese have a saying:


Always be prepared. You never know when your soldiers will be called into action. It is far preferable to have a warchest and not need it, than to need a warchest and not have it.

Thursday, March 29, 2018

Dividends Q1 2018

Being the browser equivalent of the Internet Explorer (sorry Bill),  I have only started reading the Tree of Prosperity blog by Chris. I highly encourage it for those who have not yet read his work. Very entertaining and, of course, insightful.

Chris recently got a JD from SMU (post-retirement) at a not-paltry cost of S$70,000. Not something I would do when I attain FI - hits much too close to what I am currently doing.  But see that's the fucking beauty of FI. You got all the time in the world to do whatever shit you fancy.

Chances are, plans will change, goals will shift, interests will wane, and new hobbies will arise.  Fluidity and flexibility is the essence of FI. Which is my standard reply to those who constantly ask "what are you going to do after retirement?" Yes, because finding something to do purely out of your own volition is the worst thing that could happen. Really.

Surprisingly, it seems difficult for the average Singaporean to fathom an existence that does not involve waking up begrudgingly in the morning and spending the good part of the day at a place which merely cultivates ennui and fabricates stress.

Time to take stock of my FI progress. 2018 has started off, erm shall I say, slow.

Firstly, the shares I hold in the company i work (which shall not be named) are finally eligible for sale. There is a standard escrow period upon issuance of these shares as part of a long term bonus compensation package. Long story short, the stock price plummeted 40% over the last few months. Just when I was about to cash in. Needless to say, I did not cash out and am still holding on to these shares. Fundamentally, the company is sound and EBITA is growing consistently. But the whims of Madam Market cannot be tamed.

Second, I made two large purchases into Singtel. The first was propelled by the greed for the special dividend due to the divestment of Netlink Trust. The second was due to the recent correction in its share price. In hindsight, those funds may have been better deployed elsewhere. Singtel's yield is good but its not FI-good.  And the share price looks like it would languish in the 3.3-3.4 zone for the foreseeable future.

Overall, the total dividends received for Q1 is $6,220.64, which is an underwhelming 12.4% of the annual target I had set for myself this year (50k in passive).

Main Contributors for Q1

AIMS AMP 2,122.2
CACHE LOG 217.19
(Company which shall not be named) 1,687.25

TOTAL: 6,220.64

Of course, I take heart in that my dividend income is expected to be lumpy due to my concentrated investments in Frasers L&I and Ascendas Htrust - both of which issue dividends only half-yearly.

I recently cashed out of an AIA investment-linked life policy (which the stupid 25-year-old me bought); and I also worked full weekends this month for additional income. 

Hopefully, by April, my warchest will allow me to launch another vicious assault on Madam Market.

Onward to victory my FI brethren. 

Friday, March 16, 2018

Portfolio March 2018

According to my FUMS, 2018 is a critical year for me. I termed it "the Litmus Year".  In particular, 2018 may (or may not) be the year in which I finally breach the 7-digit mark net worth.  *Fingers crossed*

Since my RI days, I had always dreamed of making my first million bucks at age 35.  I am a bit behind schedule clearly. I have another 7 months before I say bye bye to my 35-year-old self.  And I certainly hope, whether by sheer hard work or insane luck, I am able to fulfill the promise I made to myself when I was still a naive secondary school kid.


Mar 2018No. of sharesLast TradedValue

AIMSAMP Cap Reit810001.37$110,970.00
Cache Log Trust136000.845$11,492.00
Frasers L&I Tr1700001.1$187,000.00
StarhillGbl Reit200000.725$14,500.00
(Co whom shall not be named)146203.48$52,403.93

Visioncrest equity**

Other instruments*


 *This is an investment-linked insurance policy which is "surrendable" this year.

**The reason for adding the equity in my property to this 2018 portfolio is because I expect to sell my apartment this year (Seller Stamp Duty period expired in Feb 2018).

Hopefully, I am able to sell the condo sooner rather than later so that I may reallocate the funds into dividend stocks for further growth in my passive income. The recent uptick in en bloc volume is actually somewhat encouraging. When the en bloc money finally hits the resale market, it should bring some relief to the long-suffering real estate investors (me being one of them).

Passive Income for 2017

For about three years now, I have been tracking the total dividends received annually. The idea is that once I manage to hit a "magic" six-figure sum as passive income, it would be time to hang up the gloves, so to speak.

The first year of doing so was utterly demoralizing.

It was the January of 2015, and I was in a bad shape financially. I had emptied most of my savings on a down-payment for a condominium and burnt through another 30k on a wedding (which did not materialize by the way, don't ask).

It was at this ultra low point of my life when I decided I needed a formalized plan for financial freedom. Merely talking about it is not enough. Taking haphazard steps towards it is not enough. Making some progress without a benchmark is not enough. I needed a real, solid plan. One with valid assumptions, credible modelling, and multiple checkpoints to properly monitor my progress.

Enter the FUM Spreadsheet (FUMS). Or known as the Fuck-You-Money Spreadsheet. The basis for the name appears to be self-explanatory and need not be elaborated herein.

The FUMS is, at least in my view, rather comprehensive and conservative. It estimates the amount of money I am able to sock away as "investment capital" each year, estimates a yield based on the total invested capital at the start of that year, adds that to the estimated savings of the year, and informs me what should be my "ideal net worth" at the start of the following year. Rinse. Wash. Repeat.

So you could say that every January is a checkpoint. A simplified version looks somewhat like this: 

Age at end of the year333435
End of Year201520162017
Starting Capital$80,000.00$225,600.00$381,392.00
Injected Capital$140,000.00$140,000.00$170,000.00
Yield based on starting capital only$5,600.00$15,792.00$26,697.44

For instance, I had started 2015 with 80k in my war chest. I estimated that I would be able to save up to 140k in 2015. Based on a (generous) estimated 7% yield on the starting capital of 80k, I estimated that my passive income of 2015 would be a miserable 5.6k.  Therefore, ideally, I should begin 2016 with around 225k net worth (excluding equity in my property).

Yet, the reality of it all was that I only managed a paltry 4.7k in dividend income for 2015. Off to a bad start.  Even more demoralizing was the realization that, at 4.7k passive income, my monthly passive income was a sad, sad, $391.  And this was after one year of aggressive saving, equity researching and time-consuming portfolio building.  DEMORALIZING is understating it. FIRE seemed so far away.

But my fellow FIRE compatriots, fret not. For FIRE awaits those with the patience and tenacity to see it through.  It will always start slow.  But it gets better as long as you don't give up. Always keep your end-goal in sight and in mind.  Even while at work, i leave the FUMS open on my desktop window to constantly remind myself why I put myself through the shits.

By 2017, my total passive income had grown significantly. By my own estimate, I expected to receive around 26.6k in dividends in 2017. Due to a combination of good timing and consistent investing, I managed to receive $30,581 as dividends in 2017.  By a stroke of fortune, I also made a timely investment into OCBC when it was trading in the 8 dollar window and sold it when it rebounded to $10. The capital gain in 2017 was $18,864.

Accordingly, my total passive income in 2017 was $49,445 (around $4,120 per month). 

While this does not permit one to retire as yet, the passive income does take care of most of my fixed liabilities and taxes; allowing me to save even more of my earned income for investment.