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This month is going to be a very busy one for me.
I recently shared this with my YouTube community and if you are wondering how to be a part of it, here is the link:
So, before I get too busy, I decided that I should get this quarterly update out pronto.
Many hobbies and not enough time.
I suppose this is how retirement should be like.
Doing things not because we have to and not because we depend on them to make a living.
I mean if I were churning out blogs and YouTube videos daily because I need the money, it isn't retirement or at least it isn't a retirement I would want.
Oops.
I have to step on the brakes or this would be turn into a blog about F.I.R.E. instead.
Before I go off track, how much passive income did my portfolio generate for me in 2Q 2024?
$81,339.05
This is more or less the same as 2Q 2023 which saw $79,774.61.
Some investments such as AIMS APAC REIT, Frasers Logistics Trust, VICOM and Raffles Medical Group generated less income for me.
So, although I received more income from my investments in DBS, OCBC and UOB, the uplift is less noticeable.
As the title of this blog suggests, I am quite happy to be a captain of a steady boat.
Not seeking greater growth but a steady stream of meaningful passive income.
As revealed in my last blog post, I have been socking away more money in SSBs and T-bills, growing the risk free bond component of my portfolio.
This will contribute to my passive income, although not by much.
Even as interest rates gradually reduce into next year, I see our local banks as better investments than most for investors for income like me.
With DBS, OCBC and UOB accounting for more than 45% of my portfolio, I expect a steady stream of passive income, barring the unthinkable.
The question is what if something were to go wrong?
Well, I have already gotten a taste of it during the pandemic years.
I blogged about how I was worried back then when passive income reduced as dividends were slashed or suspended.
The takeaway was the importance of having a buffer.
This is so that even with reduced passive income, we can still be quite comfortable.
In 3Q 2024, I suspect my passive income would reduce, year on year.
I would be quite surprised if there isn't a reduction.
This is because I reduced my investment in Sabana REIT significantly and I mentioned this in my last blog post too.
Sabana REIT was formerly one of my smallest largest investments.
So, there should be some impact.
Of course, one quarter does not make a year.
I would just have to wait and see.
I would be quite happy if full year passive income comes in more or less unchanged, year on year.
Don't believe investing for income works?
If AK can do it, so can you!
Reference:
1Q 2024 passive income.
1Q 2024 passive income.
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9 comments:
Hey AK, I've been wanting to ask you for sometime, but keep forgetting or procrastinating.
Do you by chance know what happened to Singapore Man of Leisure?
His blog has been inactive for 1 year already.
Thanks!
It goes two ways.
When income becomes lesser, naturally we start watching our expenses. :)
Hi AK,
Thanks for sharing.
Just curious, how do you compute the interest income you receive from T-bills? Do you pro-rate it over the 6 months or simply take the discount received upfront? Do you include the interest earned from T-bills bought with CPF OA?
Also, just wondering what percentage of your passive income come from the banks? As the banks give an average yield of about 5-6% today and form over 45% of your portfolio which is pretty high :)
Understand you eventually plan to allocate around 50% to the banks. Do you typically allocate your portfolio based on cost or market value?
The banks and especially DBS have went up a lot, so thinking if it's good to rotate out into REITs or other undervalued stocks like Wilmar, if the banks go even higher. DBS hit a record highs of $37 today which is $40.70 pre-split price.
Thanks 😊
Hi ted,
The last time I heard from him was about a year ago when he left a comment in my blog.
Have you tried leaving a comment in his blog?
He replied to comments very promptly before.
Hi TDT,
Oh, definitely!
Of course, it helps if we have a habit of keeping our needs simple. :)
Hi SN,
I treat T-bills bought using CPF OA money as being part of the CPF OA and rightly so.
Interest earned by such T-bills is considered part of my CPF OA as well.
Does not get added to my quarterly passive income update.
I share my CPF numbers once a year and this avoids double counting. ;)
Eh, I haven't calculated the percentage that passive income received from bank stocks form but it is quite substantial, I am sure. ;p
My aim was actually to have 40% of portfolio in bank stocks.
So, I have exceeded that due to the spectacular price appreciation of said stocks. :)
Not rotating.
DBS, OCBC and UOB are very good businesses and my favorite holding period is forever. ;p
Hi AK,
Can speak to yourself what do you think of Astrea bonds?
https://www.straitstimes.com/business/azalea-launches-latest-series-of-astrea-pe-backed-bonds-for-retail-investors
It seems quite attractive at 4.35% and 6.35% for 5 and 6 yrs respectively
Hi Ted,
I wrote to SMOL via his blog on 30 May 24. Have not received any response from him.
Besides him, many other bloggers have also stopped blogging. I have listed some of the blogs I used to read here :
https://t.me/CPF_Tree/2959
Hi Rellangis,
This reply is so late and useless by now. Apologies. 😷 I wasn't interested in the product as I wasn't sure about private equity and the level of risk. 🤔 I rather get a 1% lower risk free return from SSBs. 🤞
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