Journey to Financial Independence

I am back, after 2 years, with positive updates

After a two-year hiatus from blogging, I’m back! A lot has happened during this time: we welcomed a new family member in 2023 (the last one, I promise!), we were fortunate enough to secure a BTO in Tampines North with a completion date between late 2025 and mid-2026, and my salary has seen some small bumps since 2021. Additionally, my team has expanded, bringing new responsibilities and challenges.

Despite the turbulence in the world, including events like the Russian invasion of Ukraine in February 2022, conflicts in the Red Sea in October 2023, and the recent tragic attack by ISIS terrorists at Crocus City Hall in Moscow resulting in 113 casualties, I remain hopeful that we will eventually see better days. On the flip side, my company has faced difficulties in 2023, with impending retrenchment looming. Nevertheless, I hold onto hope for a brighter future.

Amidst the chaos, there’s been positive news in the financial realm. The stock market has been booming since the onset of Covid-19 in 2020, and the crypto market has also seen a resurgence since early 2024 after a two-year lull. These developments indicate that my investment portfolio is on track, even surpassing expectations on my journey to financial independence.

The S&P500 has doubled since 2020, showcasing remarkable growth. Pictures indeed speak volumes, so here are my humble achievements to date:

***My Main investment portfolio at Interactive Broker (IBKR)***

***EEndowus portfolio, comprising mainly SRS, CPF, and family investments***

***Lastly, my CPF as financial safety net***

My stock investments, including a 50k USD meta stock at Webull, now total 700k SGD. This milestone makes early financial independence feasible for me, based on the following practical assumptions:

Monthly recurring investment of 5k SGD (3k SGD cash, 2k SGD OA)
Annual one-off bonus injection of 25k SGD
Average annual investment return of 10% for the next 10 years

**Projecting the growth trajectory of my stock portfolio over the next decade**

Projected growth trajectory of my stock portfolio over the next decade suggests that my family of five could achieve financial independence by my age of 48, a possibility I hadn’t imagined before. And this estimation is conservative, as it doesn’t include my CPF and crypto portfolios.

With our goal within reach in less than 10 years, it’s time to reward ourselves, as advised by YouTuber Rami. It’s time to learn the art of spending and embrace a richer life during retirement. Surprisingly, we haven’t quite mastered this skill yet, as we’ve lived quite frugally until now.

As a first step, I’ve decided to increase our travel budget to a minimum of 10k SGD per year. Let’s splurge and enjoy the fruits of our labor!

CPF Balance Hits SGD 200k Milestone

Happy new year! ~~after disappeared for 7 months, opps!~~

A lot has happened in this unprecedented year, many wouldn’t expect that the coronavirus, a vibe word used frequently nowadays, is still spreading tirelessly across the boundaries. Countries, particularly the Western, are struggling to curb the virus successfully. Thankfully, Singapore has more or less kept the virus under control since Q4 2020, albeit we are still far from getting back to pre-covid lifestyle. With government starts vaccine distribution in Dec 2020, we are hopeful to achieve herd immunity by end of this year, and life should, optimistically, get back to normal.

Despite the challenges faced both in personal and professional life, I am thrilled to see that my CPF balance finally hits SGD 200k milestone, 1 year ahead of my 35th years old birthday. To be frank, I do not set a detailed milestone target for my CPF balance, other than a vague goal of 1M65 (1 million CPF balance at 65 years old, another vibe word within the CPF community).

To add icing on the cake, I have make a voluntary contribution of SGD 3k into my Medisave account (MA), rounding it up to balance SGD 63k, further optimising my upcoming tax relief in year 2021. Luckily or unluckily, I am probably going to be in the tax bracket of 15% this year, any tax relief opportunity is a great deal of saving for me from now on. A mere SGD 3k MA top up could mean a reduction of tax up to SGD 450, enough to buy 6 cans of 1.8kg Milk powder for my 3 years old toddler!

In addition, I have, as usual, transferred Ordinary account (OA) to Special account (SA) to take advantage of the increased compound interest of 4%. The ultimate goal is to ensure achievement of FRS (full retirement sum) by 55 years old. Afterwhich CPF, particularly OA and SA, will turns into high interest saving account for my retirement, where I can withdraw the money at my wish via PayNow (or keep the sum intact to earn high interest).

In my humble opinion, CPF is a powerful tool, if used right, to supplement one’s retirement needs – it suits perfectly the famous saying of “low risk high return”, heck it should even be seen as “no risk high return”! My logic is simple, if we have already contributed, willingly or unwillingly, 37% of our monthly salary (20% from employer, 17% from employee), it is absolutely necessary to invest at least some extra efforts to maximize the returns, making sure that we can reap the fruits of your labor at the end of our working life, and hopefully before our health starts deteriorating.

I wish everyone a cheerful new year, stay safe!

eToro – Social Trading

2 months ago, I started exploring a very unique investment platform, eToro. This is a very controversial social trading portal, often labelled by others as “Scam”. Nonetheless, eToro is gradually getting accredited by reputable authorities in the world.

eToro was founded in 2007, with its HQ in Cyrus (hence the suspicion in old days), not until 2010 where it introduced its unique function – social trading with “CopyTrading”. It enables investors to view, discuss, follow and copy the network’s top performers’ trades automatically. It uses CFD as investment vehicle, and in recent months launches the most-welcomed feature to invest in the underlying in long unleverage position.

Very importantly, eToro has now acquired the following regulations, which has proven its credibility in liquidity risk.

EU – by CySEC authority
UK – by FCA
US – FinCEN
AU – ASIC

Another features I like the most in eToro is the forum-style investment discussion, as well as the user friendly financial reports & insider activities. One can find like-minded strangers in investment journey, many who in fact are very talented in stocks analysis and are able to provide different insights.

Come and join me in eToro, click here for my profile – of course I’ll be happy if you would like to copy me, let’s have some ideas exchange there.

Stock Market – Is it a V-shape Recovery?

It has been an eventful March and April, we are undergoing an unprecedented pandemic which affects greatly the norms of social interaction for human beings. A “new normality” is to continue for the foreseeable future, with huge focus in digitization and online collaboration to minimize the spread of virus.

As you can see from my previous post in March, the global active cases increase from 100k to 4 million in less than 60 days! Deaths also grow from 3.5k to 285k, that’s a very saddening and dire situation we are in. With US start its reopening last week without seeing decline of active cases, the worse is yet to come in my humble opinion.

Singapore is now entering 2nd month of its circuit breaker started in April 3, having most Singapore residents to stay/work at home in order to break the chain of transmissions of Covid-19 in the community. We have achieved much successes with reduced community cases to single digit in the recent few days, however, the dormitory infected cases is still hovering at mid hundreds with no sign of improvement.

A lot of SMEs are suffering with worsening business outlook since March. It is not uncommon to see people getting pay cut or retrenchment in social media nowadays, in which I am very grateful to still stay employed.

IWDA bottoms at 43-ish, has now recovered to 55 level

We are in a strange state – economy is worsening/plunging, while stock is soaring to its previous high. There are various “guru” throwing different market sentiments, retail investors are mostly confused and stay sideline.

What did I do? Though equally puzzled, I continue nibbling IWDA, adding tech stocks which are generally not affected by such pandemic, as well as buying few calls with expiry date in 2021, anticipating the stock market will resume its glory by end of the year.

What if I am wrong? Short term performance in stock market doesn’t matter to me, I will keep DCA on IWDA, ensuring my cash is working hard for me even in current horrified economy downturn. It has been proven without fail that the stock market rises in long term.

And I am convinced staying somewhat invested is the correct long term investing strategy.

First Bad News in year 2020

It is clear that we have entered a recession” that will be worse than in 2009 following the global financial crisis, she said in an online press briefing.
IMF chief Kristalina Georgieva said on Friday (Mar 27)

A sunny morning, my son woke up at 7am, started to play by himself, but it took us another hour to get up from the bed – we just want some extra rests on a beautiful Saturday.

Brew myself a cup of coffee, Milo for my wife, and a cup of Abbott Pedisure for my son, we enjoyed a joint breakfast together with some breads bought from barcook bakery at sim lim yesterday. As usual I checked my whatsapp message while drinking the hot coffee, and found a shocking message from my colleague.

“No increment (crying face), but better than having to axe anyone in the team”

What? I am confused, we just got the announcement from our CEO two weeks ago that our bonus for 2019 is going to be slightly above market rate, we did a salary appraisal exercise a week ago, and HR sent out a mass email saying that the salary increment will be paid in May payroll, retrospective to April. All good, I gave my team a pretty good increment, and expect a good rating from my line manager as well (he should be quite generous, I hope). What change?

After few minutes’ chat, I realised that there is an emergency announcement from CEO late last night, the management had made a tough decision not to raise the salary in this fiscal year, in view of the unprecedented CoronaVirus outbreak. This is bad, unexpected, and rather sad news to everyone, especially to my team who had gone through a tough December month on site, and they should be awarded generously for their efforts! Can’t imagine how disappointed they are when they hear the news on Monday.

It is not that I didn’t expect such cost cutting initiative to come, quite the contrary, I actually am prepared for a small retrenchment in our office by June. But the speed of how things’s change is horrendous! It proves that we have all underestimated the effect of the wide spread virus to our daily life, and we are not mentally prepared to take it, though we thought we are.

This news did disrupt my investment plan, which is to take advantage of the recent market crash to increase my stock exposure. I would have to dip into my emergency war chest now if I follow my initial plan – not ideal. I need some time to digest it, and make a new plan quickly.

Last hope for me is that no surprise for the imminent bonus payout in April, please don’t cancel this payout, my dear management, we are prepared for a bad year in 2021, but not 2020 please 😦

Recession? Opportunity?

Year 2020 is no doubt an eventful year, US-China trade war, Hong Kong protest, COVID-19 outbreak, and the most recent US Fed emergency interest cut.

It is clear that the global economy is now seriously hit by the outbreak of COVID-19, which originated from Hubei province, China, and has infected more than 100k population in less than 3 months time. Many countries have now strengthened border control, restricted travellers from affected countries from entering into the countries.

Singapore, a tiny urbanized country, which depends heavily on import and export business, has recently downgraded its GDP growth forecast in year 2020 from 1.5% to 0.5% (average). The fear of upcoming recession is getting real, miniters are forgoing one month of salary, 85,000 civil servants expect year-end bonus that is the lowest in 10 years.

Market sentiment in capital market is swinging from the extreme greed since Q4 2019 to extreme fear in early 2020, particularly the “roller coaster” share price swing last week. Is this the beginning of market crash, with the last one being in 2009, 11 years ago? Well, your guess is as good as mine.

Should we sell everything and keep our hard-earned cash in biscuit tin under the bed? Absolutely NO, in fact, in times like this, cooler heads prevail. As a long-term investor, this is exactly the moment we should, cautiously, deploy our reserved warchest into the market. If the crash is inevitable, it will be my first golden opportunity to get involved in a major financial crisis, and fortunately, I am ready to fight the battle.

Lastly, please do not blindly bet your entire networth into the market in lump sum right now, things might get worse in the coming months and there is no certainty that the rebound will be as quick. Have a plan, and execute your plan with dicipline, it will pay off nicely.

Side Hustle Ideas

Getting boring at 9-5 routine office works? Wanting to quit your job due to stress at works? It is very common phenomenon for almost every employee in the job market, and typically it happens 2 to 3 years after you joined the work force, regardless if this is your first job, second, or third job.

I, too, go through such viscous cycle being >10 years in employment. When such feeling develops, I will start exploring side hustles, for few reasons. First, distract myself from the stressful routine works. Second, look for alternative funnel where I can earn passive income from, in a hope that I can eventually escape from the rat race and FIRE!

There are so many instrument I have involved myself into over the years, such as digital marketing, setting physical and virtual shops, Forex trading, stock investing, cryptocurrency mining and speculation, and index ETF DCA (dollar-cost-averaging). Many of which are waste of time and money, nonetheless they did open my eyes and shaped my risk appetite. All in all, it is painful to spend so much money and time into such activities, but let’s look at them as investment cost, so that I feel better 🙂

DCA into Index ETF is the main side hustle / passive income generator I am focusing on since last year, and will continue investing on a consistent basis for the next 10-20 years at the minimum. It doesn’t require much of my energy / time, what I need to do is to buy certain index ETF by end of the month without looking at its price (it is not as easy as it seems if you’re investing >1,000 USD a month). I am doing this via few channels, ie. Stashaway using SRS funds and IB (Interactive Brokers) using cash, not for diversification purpose, but to fully utilize the spare money in my SRS funds invested few years ago.

In recent months, I have came across few more side hustles such as Youtube channel marketing, dropshipping via Shopify and AliExpress, print to demand, and Option trading. They are all interesting concepts for me, unfortunately the market are saturated and over supply (except Option trading). Without an enormous amount of time and effort are invested for at least a few months, they couldn’t not provide a sustainable stream of passive income everyone dreams of.

Nevertheless, option trading is very interesting to me, particularly at selling cash-secured put (get your stocks at preferred strike price, while collecting premium) and selling covered call (collect premium in exchange of the obligation to sell your stock at strike price). I am requesting trading permission for option trading in my IB account, and eyeing at some quality US stocks for option trading. My primary strategy is to collect premiums to boost my ROI (return on investment) without taking exorbitant risk

What is your favorite side hustles and if you have achieved any success in generate passive income from them? Please share your view so that I can learn from you 🙂

Speculative Investment – Cryptocurrency

If you invested 100 USD in Feb 2011, when the bitcoin price is as cheap as USD 1, you would have been a millionaire today (bitcoin price is around 8,500 USD in Jan 2020).

Since graduated in 2009, and started to have my own earning power, I had heard not only once from various sources that bitcoin is a scam, a lot of speculators who were heavily invested in it had burned their hands and some even ended their lives due to heavy loss. As a result, I didn’t spend a minute to understand this speculative investment, I wish I did.

Fast forward to July 2017, few months before bitcoin rose to its historical price level, USD 19,783 in Dec 17, I chanced up a telegram group in Singapore discussing crypto mining. As an undergraduate with passion in mechanical engineering, I was immediately indulged with crypto mining and bought my first rig from carousell at SGD 3,800, with only 1 month of research. It was a 6 x GTX 1060 rig, and able to yield close to 1 ETH a month (considering the ETH price was peak at 1,200 USD in Dec 2017, it was a pretty profitable side hustle with ROI of less than 4 months – provided you sold at peak of course). I didn’t have buyer remorse at that time, though my wife is unhappy with the fact that I didn’t inform her before I pulled the trigger – wise words for those who decided to ignore your wife 🙂

**Estimated monthly profit of USD 250 for one rig in year 2017**

I later sold the GTX 1060 cards and “upgraded” the rig to GTX 1070, and started to build my own rigs. It was a intriguing process where I bought and resold Nvidia GTX and AMD RX graphic cards, built one rig after another, and gone through the entire cycle of booming and fading mining activities in Singapore from late year 2017 to early year 2018. I once have had a total of 4 rigs with 24-26 graphic cards mounted on, turning my study room into a sauna with average ambient temperature of 35-40 degree celcius. Again, after getting some nags from my household CFO, and the climbing risk of fire hazards, I decided to move all the rigs to a paid warehouse with monthly rental (including electricity) of approx. SGD 150 to 180 per rigs, this lasted another 6 months. Eventually I cut loss and managed to find a buyer in Carousell who is willing to take all 3 rigs for a one-third of its cost. Considering the taken price of a graphic card dropped from as high as SGD 500 to <SGD 100, this deal is the best I can find in the market, before considering the last resort – rubbish chutes at void deck.

**Beautiful mining rig isn’t it? The cost is as high as SGD 4-5k when the mining fancy is at its peak**

**Profit dropped to <USD 3/day (USD 90 per month) in late 2018, can’t even pay for its electricity cost.**

All in all, the loss in cryptocurrency mining is bearable, and the fact that mining is no longer profitable for NOW doesn’t indicate that cryptocurrency is a scam. Till date, I am still happily HODL-ing some bitcoin and ethereum, and will not hesitate to add more capital once the bitcoin drops below USD 5,000 price range. Blockchain technology and digital banking is the future trend, the early we board the train the closer we are to our life goal – financial independence.

HDB Upgrade to EC – Yay or Nay?

Parc Canberra Executive Condo is a luxury development located along Canberra Link, District 27 Singapore. Developed by Hoi Hup Realty and Sunway Development, the property has intends up to 495 units with the site area of 194,187 sqft. The land site is also well served by the new 12 hectare Sembawang Integrated Hub situated just across Canberra Link. Only 400m away, the residents easily reach the upcoming Canberra MRT Station on North-South line.
Canberra Parc

Gone are the days where young couples spend low few hundred thousand of their savings in HDB (BTO / Resales), fulfilling 5 years MOP (minimum occupation period), and easily upgrade to EC (executive condominium) or even private condo with the profit gained after selling the HDB. HDB is no longer a viable investment which guarantees good returns thanks to the multiple cooling measures implemented by Singapore government, for good reasons, particularly since year 2013 when the HDB price reached its peak.

My wife and I picked the worst timing purchasing our 1st property – 5I resales HDB in Singapore, at a whopping cost of SGD 495,000 in late 2013. Similar to other residents in Singapore, we were told that the HDB price could only goes up and the sky is the limit, due to land scarcity. Truth is the price doesn’t recover till date and we are standing with more than 20% loss on capital. It was not a concern for us initially and we were happy with our dream house. However, now that our baby boy is growing fast, we start having many other considerations such as proximity to primary school, comfortable and kid friendly environment, smart home facility (okay it is merely for my own indulgence), and etc. The thought of EC upgrade comes into our mind, and Canberra Parc comes just at the right timing !

**20% capital loss for our HDB “investment”**

Of course, there are many other financial considerations to be evaluated before we even think of pulling the trigger. One of the main concerns is the cash outlay required for down payment could be amount to minimum a quarter of a million dollar. Considering that we have very minimum CPF OA savings in our account, due to consistent OA to SA transfer done since 2 years ago, I might have to liquidate my stocks to fork out such an amount, of course it is not my preference as it will disrupt my long time investment planning. The benefit of upgrading to EC is that the potential of capital appreciation is much higher than HDB based on historical data (again one could argue that past data doesn’t represent future growth , but all in all the potential / probability of price appreciation is still much higher than HDB).

Anyway, we have booked for show flat preview after CNY, where we will also discuss the overall financial commitment with the property agent. It doesn’t cost a dime for such preview, just our time of a day on weekends 🙂

Update 06 March 2020:
We have decided to drop the idea of investing in EC, due to huge upfront cash outlay required, as much as SGD 250k for a SGD 1 million EC. We do not have so much cash reserve for this commitment, and it is too much a concentrated risk to have our reserve capital to be poured in a single investment vehicle, although based on historical data EC’s appreciation in value is rather generous if the location is convenient.

Time in the market or Time the market?

It is probably not uncommon to hear this – time in the market is better than timing the market. These are 2 different investing philosophies, ie. waiting for market to crash before pulling the trigger, or dollar-cost-averaging every fixed period of time, ignoring the market condition.

I was once a believer of stock picking, creating many templates to analysis the P/E ratio, P/B ratio, discounted cash flow, John Neff screener, Graham checklist, etc etc. It is intriguing to add more and more screeners into the template, only to find that they are most of the time conflicting with each other. This often complicates the stock picking process particularly to a clueless amateur like myself. As a result, those templates get dumped into cold storage, and I start following the leads from other financial bloggers.

My favorite is definitely AK71. If you are into financial bloggers in Singapore, you must have heard of his name in various online forums. He is very famous for his extremely frugal lifestyle, but at the same time his brilliant, selfless, down to the ground sharing of his investing ideas back in 2009/2010 when he first started blogging as a hobby. His mid six digits dividends income is a legendary achievement in Singapore. Unlike many other financial bloggers who are fond of US / global market, AK71 achieved his financial independence in his early 40s only by investing in SG stock market, particularly in REITs.

Followings the free-of-charge stock tips from AK71, and some guts feeling, I built a 8-10 portfolio (mainly REITs) since year 2010/2011, it performed very well and even beat the STI benchmark (ES3) in some good years (particularly in year 2012). The portfolio produced some 4 digits passive dividend income yearly.

**Not bad a portfolio considering it is based on copy & paste and guts feeling approach?**

**Didn’t realize that I’ve collected close to SGD 50k dividends in the past 9 years …**

The buy and forget approach yielded quite good profits in dividends for the past 9 years, however, there are also few stocks which I have to cut loss eventually as fundamentally the business is losing its steam, namely Sabana REIT and First REIT. I am grateful that the losses, though painful, are still within tolerance and insignificant as compared to the losses incurred in Forex Trading and Cryptocurrency Mining (story for another day). All in all, my result in stocks investing till date is still in green. I do aware that my “achievement” in stocks investing is no less than pure luck. Though I did try to spend some time studying fundamental & technical analysis, the interest often gets faded quite easily mainly due to the pressure in my day job.

In year 2018, I chanced upon a thread in HWZ Money Mind forum named “Shiny Things Club”, the thread starter was a successful proprietary trader and wrote a book “Rich By Retirement” illustrating ETF investment terminology in Singaporean context. The simple and effective DCA (dollar cost averaging) investing method quickly gets to me. I then started my ETF investing journey since late year 2018 via low cost broker IB (interactive broker) recommended by Shiny Things. I simply invest a fixed sum every month into IWDA, and “go to pub”.

Since DCA requires little effort in stock analysis, I now have more time to focus in building my active career, which produces more invest-able capital to be injected into my portfolio. My next action plan is to divest my SG stocks completely and transfer the capital into global ETF, so as to balance the geographical risk. To be honest, the DCA method, though effective and is a proven method to grow your asset steadily, is rather routine and boring. To keep the momentum lasting for >20-30 years, I have decided to allocate a small amount of my savings (5-10%) in speculative investment – cryptocurrency mining and trading. Please note that this is not for everyone, if you have other casual hobbies to divert your attention, please do so and stay away from bitcoin, ethereum and whatever shitcoins recommended by some “financial gurus”.

In a nutshell, time in market is always more superior than timing the market, unless you are the legendary Warren Buffet, Graham Phillips, Jim Roger, or the infamous AK71 . This is the reason why most of hedge funds are not able to beat the benchmark CONSISTENTLY. Therefore for majority of normal peasants like us, it is recommended to stick to simple (and boring) investment method, and spend your time and energy in other activities, let the compounding interest does its magic to fund your retirement.

What is your opinion? Do you prefer to analyze and cherry pick stocks on your own? There is no right or wrong answer, just personal preference.