Friday, December 12, 2014

Short term goals for my long term plan

I was tallying up my numbers to plan for the short term goals in the next 2-4 yrs. I was 'suddenly' inspired to save up again. The last time I did that was because I wanted to save up for my downpayment and renovation for my flat without getting in debts. So there was this period that I was going 50k per year savings for 3 yrs. Looking back, it's a very sad 3 yrs where I worked like a crazy rabbit on steroids.

Here's goes the thesis. I want to earn enough passive income to hit my stage 1 of my financial freedom game. Stage 1 means that I will have enough dividends to pay off my part of the monthly mortgage loans of 1k (total 2k, but split between me and wife). So working backwards, I needed 240k on a basis of 5% returns to get 1k per month. I know I can achieve that because my current Singapore portfolio is getting that returns. My US is getting more than 5% and for my HK portfolio, I subscribed to dividends reinvestment program (gross dividends about 5% before cost), so the dividends are rolling and compounded. Anyway, yield is easy to get, you just need the base to be big enough, which is what I'm working on right now.

Here's the summary:

I need $1k per month
Yield: 5%
Capital required: $240,000

Invested in market: $75,000
Investible cash: $70,000
Total capital so far: $145,000

Capital shortfall: $240k - $145k = $95k or approximately $100k

Okay, so I needed another 100k more to fulfill stage 1. And with that, I would also need to set aside 10k of emergency cash (3 months), 2 yr worth of mortgage payment ($1k from my portion) in CPF OA account.

Probably can hit this in 2 yrs time, provided I'm lucky in my career. Once I hit that stage, I can finally think about going easy. Maybe I'll take 1 day off per week instead of working 7 days LOL! Till then, excuse me while I work on my 50-60k savings per yr. This time, it's going to be more fun than the last time. Somehow after my 1 yr hiatus, my drive and motivation is reset :)


B said...


Wow no joke there.

Saving $50 per year is a huge achievement. It will be a big successful if you can hit those figures. Now that you are motivated enough to go aggressive again I have no doubt you can do it.

Just let us have some time for our next kopi session.

Sillyinvestor said...


A inspiration that a self-employed tutor can achieve this. I said this in sincerity.


Even if you missed your target by 1-2 years, I would still think of it as a achievement

Anonymous said...

Hi LP,

Just to check with you, how do you sign up for dividends reinvestment program for your HK portfolio?

I'm currently using SCB's online trading platform to for HK stocks.


jfree said...


I am a new blogger and started investments 3 months ago.

Reading up your blog motivates me in achieving my own goals too. Is there some tips that you would like to share regarding saving $50k per year? Not easy in Singapore ya?

Createwealth8888 said...

Quote : " Anyway, yield is easy to get, you just need the base to big enough, which is what I'm working on right now."

Strongly agreed man!

5% yield is not that difficult to find.

Investing for yield is all about account size.

Singapore Man of Leisure said...


I faint.

OK, I'll check up on you once in a while to make sure you don't lose the plot while busy chasing your short term goals and long term plans ;)

If she stops putting ice-cream on your nose, you're in trouble!

There is no "excuse me while I work on my 50-60k savings per yr" when it comes to relationships ;)

la papillion said...

Hi B,

Quite sure 2015 can hit the target because unlike last year, I will start the year running. It's 2016 that will be the worry, but then again, I always worry about the next yr and the next. There's no illusion in safety in my line haha

la papillion said...

Hi SI,

Thanks thanks :) It should be achievable. My earnings visibility for next year is quite clear :)

But before anyone jumps to this line, I must say that it's not easy working like that. At the peak, it's 6 hours per wkday from 3pm to 10pm, and 9am to 9pm for wkends. Be prepared to work for about 1 to 2 months at this kind of peak. If you are in this for money, I think there's easier money than teaching kids to study.

Don't say I never put disclaimer lol

la papillion said...

Hi finance4uandme,

It depends on what you invested. For me, I got HSBC and they have a dividend reinvestment program (at a discount somemore!). I suppose not all counters have this program.

la papillion said...

Hi jfree,

Thanks for reading :) These days, young pple are really very matured, looking into financial stuff at such a young age :) I'm still playing final fantasy and fallout during my army daze lol!

Hmm, tips? There's plenty out there, an I must have wrote it down in various post. What you need are not tips, but a reason and therefore the motivation to do what is necessary.

Ask yourself how desperate do you want to do what you want to do :) That shld help.

la papillion said...

Hi bro8888,

Haha, I knew you'll agree :) 5% is indeed not hard cos I'm not looking at 10% or 15% pa. Investing several blue-black blue chips can easily yield 5% or more. If we desire more, then will have to be a bit more discerning and look at mid to small caps.

la papillion said...


Can always count on you to provide unconventional viewpoints :) Thanks for the reminder...if you see me blogging about stuff you don't agree on because I've "walked fire entered demon", do kok my head and slap me several times until I'm awake!

I mentioned that this time, the journey for the same 50k will be very different from the past. I already tried it this year. It's gng to be a much more enjoyable trip, simply because I don't have to go out as a big part of my classes are home-based. That makes such a big difference because in the past, having 6 hours of teaching means staying 8 hours outside since it includes travelling and meal time. That means I wake up earlier and go home later. The fatigue makes me more irritable and jumpy.

Now, in my small controlled air-con environment, I can make myself a nice cup of hot tea while teaching, while I kept my mind energised with the scent of Mt Sapola's lemongrass scent . Things are gng to be great :)

Rmb to kok my head!

Rolf Suey said...

Hi LP,

I assume this is 2015 resolution as it reminds me to plan mine.
To think that you are working 7 days a week and yet enjoyable is admirable. With this attitude, I think your target is definitely not far away.


la papillion said...

Hi Rolf,

We have to see what is necessary and see if we are willing to sacrifice what is needed to reach there. I'm willing to work at this pace because I know there'll be an end point somewhere. And frankly, I really love what I'm doing. There's a lot of satisfaction from mentoring young pple and the financial rewards is just one small part of the whole package.

At a certain pt in time, it's not about adding more classes to get more income - it's about helping one more student who I know I can make a difference. I just can't say no. It's like you are a doctor running a clinic and someone came in while you're closing for the day. I just can't say no - I won't be able to live with it.

That makes all the difference in the most miserable of moods, in the darkest days and in the blackest nights.

Anonymous said...

Very inspiring. I tutored before in the past and it's a lot of work travelling to students' homes. I wish you all the best. I am working on having a big base for investment myself. It certainly takes time but every pay cheque we get, we know we are one step closer.

Renewed investor

la papillion said...

Hi renewed investor,

Thank you :) It is a lot of work travelling from student place to another. Sometimes, it feels like I'm route marching from one place to another and I will arrived at the home drenched in sweat. All the walking makes me tired and during the lull periods of the lessons, it's really very hard to stay awake. And all the waiting and stress of taking public transport...esp the waiting bit. I only hve 30 mins to travel from one place to another, so it can be stressful to keep the timing tight.

Thankfully it's over for me now.

I totally understand the part about getting one step closer, one pay cheque at a time. My money comes in small drips instead of one big chunk. Every bit saved will indeed add up at the end of the year.

My 15HWW said...

Hi LP,

My first thoughts probably revolve around your mortgage. That's one expensive flat! =p

Anyway, all the best with your goals. When you're doing what you like with motivation, hard work doesn't seem so hard.

But like what SMOL mentioned, don't neglect the other important stuff!

la papillion said...

Hi 15hww,

Ya,it's a resale in a mature estate so no choice loh. When I got it, I was thinking of getting a bto in ulu area and get a car, or I can get a more expensive resale in mature area and skip the car. In the end, I got a more expensive flat AND a car lol! But that's life.. If I'm living alone I can plan and stick to my plan, but living with another person, it's all about consensus and shared goals and expectations :)

On hindsight, if I get a cheaper bto flat, I can probably accelerate my whole process. But what's the point? I'm so happy with my home and everyday I'm enjoying it :)

Haha, indeed it's not going to be that hard ;) nah, don't worry, even if I want to work like a crazy rabbit I might not be able to do so. Somehow, when I get older, the mentality is different. If it's too much trouble, I'll rather not do it. I sometimes wonder how I cheong in the past.. Probably can't repeat that level again even if I want.