Wednesday, August 30, 2017

32nd Birthday Post - A Year of Milestones

This is the 5th edition of the post since I've started to blog on this site.

For some reason, I missed to write on my birthday last year and couldn't remember what I was doing back then but here's all the past couple of sessions.

30th Birthday Edition

29th Birthday Edition

28th Birthday Edition

27th Birthday Edition

Alright, I am getting older and I can feel it the moment I turned 32 (ok just kidding). I'm feeling it more and more each year that the days and years fly past faster than I thought. I think there's a correlation sign there.



Age is very subjective. There are people that will think I'm old (if you are a student reading this) and another group which will think I'm young (if you are my senior). To me, it's another important phase of life that we just have to go through.

This is a year of different milestones for me and many things happened in the span of across a year.

Finances


This is a year where I achieved both my milestones of reaching the $500K and then $600K a few months later due to decisions that goes in my favor, such as the uptrending bull market and Chelsea winning the EPL last season of course.

I also had my second child born earlier this year, so I had to put this as one of my biggest moment in life too.

Expenses have been increasing since my elder boy went to pre nursery school and my younger are born in January this year.

After we had our second child, we started engaging a permanent nanny in the house. So we had one domestic helper who is doing all the cleaning and cooking and another who is helping to take care of the kids. We have plans to terminate the nanny permanently after about 3 years or so but in the meantime, that means double hit to our pockets in the interim. These costs are equivalent to owning a car and this explains why we will never be able to afford one with our current income.

There are good value and reasons in doing it as we are able to free up most of our time in the administrative task and focus on the value-adding part like playing, studying, singing and exploring the world together. In doing so, I also have more time on writing and focusing on my work and personal investment which is bringing greater returns so far. My wife is also able to focus on her online business. So there are blessings for that.

Cashflow

I have figured out pretty much the patterns on the cashflow.

Every March, June, September and December, my cashflow would be in negative position. 

The school fees are recurring every quarter so this would suck up most of my cashflow.

In addition, we usually plan for our traveling during the school holidays, so that would hit us another big time.

In other months, I managed to save up around 20% of my take home income approximately.

The savings are in the range of $20,000 per annum these days. Most would come from the annual wage supplement and discretionary bonus.

Financial Independence Target

When I started this blog and write my target of achieving the financial independence by the age of 35, I think many treat it as a joke.

I have my doubts too in the earlier years. After all, why would someone with only a few years of working experience and such miniscule income can daydream of such lofty ambition.

I never really take it for granted. It was a stretch dream for me to achieve.

Financial Independence is the dream for me.


I think achieving $1m would be a milestone for me to call it a financial independence officially. I'm excluding a lot of parts in this number, such as the CPF, housing, child's fund, wife's portion etc so there's my margin of safety. It's purposefully design this way so I have something to fall back for in case my target is missed.

Financial Independence doesn't mean I'll stop doing any work at all and start doing withdrawal from it. Contrary, I think things could get interesting from there since psychologically the dividend would cover the expenses fully from there.

I'm excited to see where it would take me from there.

In order to achieve that, it would require me to achieve a return of 15% for the next 3 years by reverse engineering. The 15% return would most probably come from a combination of 6% dividend and 9% capital gain.

I must admit that is a stretch target to achieve but not impossible.

Let's just try to give it a shot.

Birthday Celebration

Okay, now that the heavier part is over, it's time to switch the focus to something more important to me.

I took leave today from work to spend my birthday together with my wife, children and dad.

We ate at the spanish restaurant and called for a few tapas and paellas. The price was excellent and service was top notch, so that's another score for me.



Come to think about it, I actually quite like spanish food and learning spanish is something I'd like to accomplish at some point in the future. I went to Spain in 2014 as part of my school exchange trip and really love the country.

My son was eager to sing the birthday song and blew the candle so we had our celebration over there as well.

At this age, I do not need any grand celebration or anything like that. A simple meal and something like that, more than a full score for me.

Coincidentally, I shared the same birthday as one of my favorite investor of all time, Happy Birthday Warren.







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15 comments:

  1. Hi Brian,

    Happy birthday to you!! And congratulations on achieving the milestones!! :)

    ReplyDelete
    Replies
    1. Hi sleepydevil

      Thank you for your wishes. Hope things go well at your side too. Looking fwd to reading more of your posts.

      Delete
  2. Happy birthday!

    Reaching financial independence is NOT mandatory stop work order. It is a significant milestone in our life journey. Preferably; we can reach this milestone earlier than the official retirement age.

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    Replies
    1. Hi Uncle CW

      Thank you!

      Agree its not a mandatory stop order to work. I think the biggest advantage is psychologically it gives us that option to explore something beyond our boundaries :)

      Delete
  3. Happy birthday B... may your wishes come true... financial freedom for me is about having the time to do the things that really matter ^_^

    ReplyDelete
    Replies
    1. Thank you Mr. IPO.

      I think you've contemplated the same with your SRS strategy :) agree its time with loved ones that matters.

      Delete
  4. Happy birthday to you, it's been a joy to read you hit another milestone, and even more wholesome to see you sharing lovely moments with the family.
    You will smash your FI goals, I am from the future.

    ReplyDelete
    Replies
    1. Hi MT

      Many thanks for the wishes.

      I'm touched by your words, appreciate it. I think at some point I will hit some roadblocks but hopefully they are nothing but a test to overcome the bigger goal :)

      Delete
  5. Happy Birthday, B!

    Really looking forward to your 35th Birthday Post! You have continued to remain an inspiration for the past many years. Living well now together with a good plan for the future. Thumbs up!

    ReplyDelete
    Replies
    1. Thank you much Thomas!!

      To think that our community have come so far together I think we all enjoy each other company and motivation to be a step together. I am anxiously waiting for your updates too!

      Delete
  6. Hi Brian,
    Happy Birthday:-)
    Wish you Health + Wealth

    Can share the name of the Spanish restaurant:-)

    Thank you
    David

    ReplyDelete
  7. Happy Belated Birthday, B!

    It's funny that people think that your goal of reaching FI at 35 yo is a joke. Look who get the last laugh now?!! Your annual passive income is surpassing many people annual income!! It's a living wage if you're continue to be frugal. LOL :)

    Many of my co-worker and even my own family members don't believe that I'm FI LOL :) They know I'm super frugal, make 5x of one of my brother make, and spend less then what he's currently spending, but he couldn't believe that I could retire. hihhiih early retirement is something that not in their mindset. LOL :) One of my sister told me I need to work until I'm at least 55 yo. LOL :) Just because... hihii.. she said if I don't work, I can get myself into trouble because I'd have too much on hand. :)

    ReplyDelete

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