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This is a commentary on a commentary by Keith Yap, a graduate of Economics & Development from Lee Kuan Yew School of Public Policy.
OK, that was just AK being cheeky.
AK is not learned enough to write a commentary.
AK only talks to himself.
It was a rather interesting article in CNA and anyone who is interested can read the full article titled
"By wanting to retire early, millenials are subverting conventional ideas of work and finances": HERE.
It says most millenials want to achieve financial freedom in order to retire early.
Many millenials do not enjoy the work they do and they want to achieve F.I.R.E. so that they can choose to do what they truly enjoy without having to worry about the lack of an earned income.
The desire to achieve financial freedom also stems from a greater feeling of financial insecurity, economic malaise and the heightened inflation we are experiencing now.
It also says that adherents of F.I.R.E. aim to save 70% or more of their full-time income and that the ultimate aim is to save 25x of one's annual expenses and make 4% annual withdrawals for living expenses.
Meticulous planning, extreme frugality and common sense investing are all things which characterize the F.I.R.E. movement.
OK, at this point, long time readers might be asking:
"Alamak, is Keith writing AK's biography?"
Spooky!
See:
Save 100% of our take home pay!
However, I think that saving only 25x of our annual expenses seem a bit risky.
AK is very kiasu.
See:
To retire by 45, start with a plan.
and
So, to the F.I.R.E. Padawan reading this blog, be kiasu a bit and build a buffer.
Seriously, you won't regret having a buffer but you might just regret not having one.
If AK didn't have a buffer, AK might be sending out job applications now.
See:
Before I continue, in case some think that AK might be making a mountain out of a molehill, the article in CNA cited a TODAY Youth Survey done in 2021 that found 59% of respondents between ages 18 and 35 said having enough funds to retire early is a top indicator of material success!
Wow!
That is so different from when someone told financially independent AK that he should be ashamed of himself!
Unintentionally or shamelessly giving myself a pat on the back?
You say lor.
See:
Financially free AK should be ashamed!
The article went on to say that if the prices of cars, housing and daily household goods continue to rise, millenials are likely to delay marriages, home ownership and having children.
Millenials would focus instead on securing their own financial independence.
Wow!
Good call!
AK claps for you!
See:
A happy marriage is worth waiting for.
There is a Chinese saying that goes:
先苦后甜Bitter now, sweet later.
Work hard now and enjoy the fruits of our labor later.
See:
Three attributes of a wealthy peasant!
Some people might tell me that F.I.R.E. is not the way to live life but it is my life.
F.I.R.E. is not just something personal but it is also about being socially responsible.
People who have achieved F.I.R.E. are not a burden to the society unlike people who are "lying flat."
See:
Lying flat is not financial freedom!
Of course, if striving towards F.I.R.E. makes us miserable, then, we might have to take a step back.
Look at what we are doing and see if we might have to cut ourselves some slack.
Anyway, I am happy to find out that so many young people are working towards F.I.R.E. in Singapore.
A big hurrah for everyone working towards F.I.R.E.
If AK can do it, so can you!
Recently published:
1. ComfortDelgro or SIA?
2. $300K lost in crypto staking.
Reference:
7 blogs on AK the investor (including secret of my success.)
Bloggy Award
11 comments:
Yes We Can !! 0:)
Hi Laurence,
Believe it! :D
Hi AK,
If I have reached FRS in CPFSA, I would not be able to xfer further funds from OA to SA right? Would it be wise to park some OA funds in STI ETF instead? Appreciate your insight. Thanks!
Hi Ak,
Recently IREIT share price has been on a declining trend, from $0.64 a year ago, now its $0.56. 12.5% decline.
When i see 1H 2022 financials, looks like Net Property income grew by 26% and income available for distribution grew by 20%. But, the actual DPU declined by 1.4% to 1.41 cents.
The management commentary is decline is due to effect of management fees paid 100% in cash.
And if fees is paid in 100% in 2021, increase in DPU will be 3.7%.
I dont understand why income available for distribution grew by 20%, but the actual distribution decline and share price is also declining.
Is this due to the forex fluctuation?
Please help understand and provide your view.
Many thanks!
Krishna
Hi Rellangis,
CPF savings is the investment grade bond component of my portfolio.
Risk free and volatility free with reasonably attractive coupons, there is no reason for me to tinker with my CPF savings.
Well, not unless Mr. Market goes into a deep depression which is also why I blogged about the CPF as a war chest before too.
The stock market is not risk free and volatility free.
So, we have to be prepared for losses which could happen.
References:
1. CPF is all we need unless we are very rich.
2. Investors eat crusty bread with ink slowly for peace of mind.
Hi Krishna,
I like to remind myself that price is what we pay and value is what we get.
IREIT Global's unit price could go up and down but I am more interested in the value I am getting.
IREIT Global is undervalued and even more so today.
I like that the management fee is paid for fully in cash as it means that the DPU is not financially engineered to be higher.
DPU in S$ terms has declined as the EURO has weakened a lot but even with the weaker EURO, IREIT Global is still undervalued.
Patience is sometimes the hardest thing but being paid while I wait for things to recover is not too bad especially when the waiting time could be quite long like in the case of Saizen REIT so many years ago for me.
However, if we think that Europe is going kaput and IREIT Global with it, then, don't wait. ;p
Reference:
IREIT Global's 2Q 2022 results.
Hi AK, What are your thoughts on Capitaland china trust.
It has dipped lower than $1.10. Any plans to buy more?
Nic
Hi Rookie,
The last time I added to my investment in CLCT was at under $1.10 a unit which is pretty much where it is at now.
So, no intention to add more unless the unit price dips much lower, everything else being equal.
This is especially when we are only a quarter away from the end of the year and I would rather set aside money to pump into my CPF account which I still plan on doing till I turn 55.
My investment portfolio is generating more than sufficient passive income for me and I am in no hurry to put more money to work in the stock market.
References:
1. Capitaland China Trust: Another largest investment?
2. The AK passive income strategy after making $1m.
Aiya.....our time very different from now la. Back then, internet and handphone not so common. TV and newspapers were the mainstream of information. Only a limited amount of investment information was been passed around.
Now le, youtube full of gurus marketing investment ideas and courses. Feeling bored inside the MRT train? NVM, handphone click click study whats the next investment trend in the market. Information nowadays passed around like lightning. LOL. Our young boys and girls now has more access to all sorts of information about F.I.R.E.
Hi TDT,
Oh, true that.
News everywhere, both real and fake.
Gurus too. LOL.
Too much for my old brain which is why spending more time in virtual worlds is not a bad thing for me. ;p
"The European Central Bank is clearly awake to the threat of inflation. Thursday’s unanimous 75-basis point hike to its benchmark deposit rate is the largest in the ECB’s 24-year history. The era of negative rates is now firmly in the rear-view mirror. The bank’s forward guidance is dramatic: If necessary, more hikes will follow over the next few meetings into early next year."
The ECB Hikes Big to Fight Inflation and Bets on Optimism.
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