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Saturday, June 30, 2018

The Millionaire Milestone

Ah, the original FIRE anthem.

Obviously the song is a little bit dated (written in 2001 I believe) and there are limits as to the FIRE lifestyle one may reasonably finance with $1M today. But it is probably not a stretch to say that, this song served as inspiration for many FIRE compatriots when they were starting out.

I am 35 going on 36 in 3 months'  time.  And I am pleased to announce that, excluding any CPF funds, my total Assets Under Management (AUM) crossed the milestone 1M mark this month.

June 2018


AIMSAMP Cap Reit810001.4$113,400.00
Cache Log Trust136000.77$10,472.00
Frasers L&I Tr1897001.05$199,185.00
StarhillGbl Reit200000.645$12,900.00
Co whom shall not be named146204.45$67,010.77

Property sale proceeds (cash)




Almost didn't make it due to a particularly annoying Telco. But luckily the huge dividend payout in June and my extra weekend work income mitigated this and propelled me over this psychological finishing line.

As the adage goes, "the first million is the hardest." Quite right I must say. 

No resting on laurels. This is only the beginning.  I can feel the FIRE burning in me now. Onward my fellow brethren in arms. 

It is time to break our shackles. For we have nothing to lose but our chains. 

Wednesday, June 27, 2018

Dividend Income 2Q 2018

A much-awaited, all-time high dividend income was recorded this month June 2018.  We should be looking to continually break this record in the years to come.

This month's star performers are:

Ascendas H Trust - $7,355.50
Frasers Logistic Trust - $ 6,137.00
AIMSAMP - $2,130.30
Total - $15,622.80

Combined with the May distributions by Cache Log Trust and Starhill Global, the TOTAL DIVIDEND INCOME for 2Q 2018 is $16,045.76.

Combined with 1Q distributions, my half yearly passive income is $22,266.40, which translates into a tracking monthly income of around S$ 3,711 per month. Far from ideal. Will be looking to drastically raise this number by re-investing my capital  once I receive the proceeds from my property sale.

My June earned income is also expected to be slightly more than normal due to the extra weekends worked.

This is also the end of the financial year for my firm, which means performance-linked incentive bonus cash and stock payouts would be made in the coming months, probably September.

The market has been weakening and I am tracking a 5% in unrealised portfolio losses. The bulk of the losses comes from Singtel (-12%) and a dead-beat down-stream O&G counter (Ezion) which i stupidly punted around 20k at the height of the oil crisis (now trading at -90%).

At least with Singtel, after adjusting for dividends received, the loss is mitigated to 6%.  No use crying over spilled milk I guess.  As a wise man once told me:

A thousand gold cannot buy early know


Sunday, June 10, 2018

Spare us the rhetoric

 Ong Ye Kung clearly did not receive the memo to speak plainly.

To wit, Ong visited the Swiss, fawned over their education system, and suggested importing particular aspects of their system.

In a three page borefest, Kelly Ng of Todayonline notes:

He noted the Swiss system’s emphasis on vocational training and “alternate pathways” for nurturing talent have created a more egalitarian society — one where parents and children pick either the academic or apprenticeship route based on a child’s interests, talent and aptitudes.

The Swiss society also “embraces and celebrates many forms of achievements and success”, said Mr Ong.

Here we go again with that "multiple pathway to success". You know why Swiss society can celebrate "many forms of achievements and success"?

Because of substantial income equality. For example a postal worker in Switzerland makes an average annual income of  S$90,335. A teacher? S$118,684.  A doctor? S$149,202.

Yes, doctors and lawyers still make more. But not that much more. And their post-tax income would in fact be comparable due to the high income taxes. The Swiss also have a minimum wage.

To speak plainly, this means that, for the Swiss, what you study, and where you went to school, is much less high stakes.  No matter your job or vocation, you can experience a reasonable quality of life, that is not too disparate from your neighbors.  This in turn provides dignity. It is easy to see how Swiss society is able to celebrate "many forms of achievements and success".

On the other hand, let's look at the situation in Singapore.

Annual income
Doctors (Specialist)  - S$340,956

Train Captain (SMRT) - S$23,000 - S$42,480 (max)

For one living on 23k a year (before CPF mind you), dignity is not really a word that comes to mind when you think about the "lifestyle" one can afford with that pay.

After all that rhetoric about changing the Singapore education system, the article by Kelly does not once mention the issue of income disparity. Not even once.  It is telling isn't it? 

This is the classic cart-horse issue. The Swiss' egalitarian society shapes its education system, not the other way round.  Adopting the Swiss education system but retaining SG income disparity will do a grand total of jackshit.  Parents (and children alike) are still going to fight tooth and nail, and stress out over every last mark in a test, so that they are more likely to land a 300k a year job than a 20k a year one.

That said, it must be confessed that I prefer the current Singapore system.  Competitive. High stakes. Merciless.  After all, what is the point of working your ass off if it does not provide you an edge over the rest.

In fact, what I am more worried about is the G ultimately capitulating to all the SJWs like Prof Teo and start pandering to populist tax policies (and by populist tax policies i mean taxing the rich).

If (when?) that happens, it would be great if I had already FI-ed.  You won't catch me working 50-60 hour weeks just so that Mrs-my-husband-does-not-work-housewife can have her fifth child and then cry for State help.

Thursday, June 7, 2018

Starhill Global Reit

Starhill Global REIT

I am of course not a financial advisor and anything posted in this blog cannot and should not be taken to constitute financial advice of any sort.

Last traded price as of 7 June 2018: $0.68

SG REIT is trading at a huge 26% discount to Net Asset Value ($0.92).

Its DPU has declined consistently since FY 2015/16 from 5.11, to 4.92 and 4.57 (estimated 7% decline for FY17/18).

Have we reached rock bottom for SG REIT in terms of DPU? Perhaps not, but I have a feeling we are quite close. In terms of office space, recovery appears to be on its way.

SG REIT has completed its enhancement works on Plaza Arcade in Perth and its anchor tenant Uniqlo will move in by mid 2018.

While we cannot predict whether the retail sector will rebound in Singapore, my gut feel is that further downside is unlikely, given the robust performance of the SG economy (up 4.3% y-o-y for Q1 2018).

Because it pays to be a hum ji kia, for safety, we may assume a further 7% decline in FY18/19 DPU to 4.25 cents. At that conservative yield,  the current price of $0.68 still provides a 6.25% yield, which is more than respectable.

In other words, I believe the current price provides an attractive safety buffer for entry, even taking into consideration further downside in DPU.

Conversely, if the office space sector and retail sector were to experience any unexpected rebound in 2018/19, you can be sure SG REIT would no longer be trading at a 26% discount to NAV.  A good strategy may be to sit and wait for recovery, while earning a 6.25% yield on your investment.

I am very tempted to enter. Just a matter of sourcing funds. The proceeds from my property sale can't come soon enough. Hopefully the YTL ship has not sailed by that time.