Thursday, December 05, 2019

Reflection of the year 2019

I promised that I will write a bit more in-depth about the year 2019, qualitatively instead of quantitatively. I shall attempt it here. It's always good to reflect on what had happened in this year, learn from the lessons and make new mistakes in the future. I last made a self-reflection for the year 2018 here. I'll try to give a grade for different themes. My grading matrix is like this: 4 categories, namely Finance, Mind, Body and Spirit. Here goes:


This year my networth increases by about 100k, boosted by higher active income. I had quite a good year with more group lessons, so my income got boosted more than average. On the investment front, STI is up pretty much and as they say, a rising tide lifts all boats. Time-weighted returns is a modest 11.8% vs STI's 6.62%. Okay lah. At this stage, I'm more interested in accumulating enough capital to have a high potential dividend income to prepare for the future when I have to scale down on my active work. The current target is 500k investible cash plus the invested amount. I've a shortfall of about 120k, so I think I should be able to reach that target in 2 to 3 years. If the stock market crashed 50%, then it's a different story of course, haha

Without really tracking closely, I also realised that my dividends from companies + all interest-bearing accounts + income from non-active work, adds up to about 1.2k per month. That is the goal that I had set like 5 yrs ago. Even after subtracting some income that I think are non-recurring, it is still about 1k per month. This means that the plan that I had started 5 yrs ago is starting to bear fruit. I'm very happy about that. 1k per month is about the mortgage (for my half) that I had to pay per month, so it's a huge load off my mind since it is the single biggest debt, and hence worry, that I have currently.

Finance: 10/10


This year I read a lot of books and discovered a new genre to delve into. At present, I had read 50 books, so I should be able to come close to my target of 52 books. I read more because, in the earlier part of the year, I borrowed a lot more physical books from the library in order to show my son that reading is something enjoyable and it's what we do at home. From the book tearing enfant terrible earlier in the year, he progressed to someone who will pick a book up on his own, flips through the pages and tries to read aloud (like us when we are reading to him). I think it's a terrific improvement in that aspect.

The new genre that I discovered this year is Chinese Sci-fi, particularly the works of Ken Liu and Liu Cixin. Mind-blown. I'll do a proper post on the books I've read in the near future, and will also recommend some of the better books from the whole list.

I started learning the piano this year too. I've always said that I wanted to learn how to play the piano, but my 'excuse' is that I'll wait till my son wants to learn so that I can learn together with him. One day, I asked myself what is stopping me from learning right now? Nothing. So I went ahead to buy a weighted digital piano, signed up for Udemy, and started learning. It's slightly more than 1 month already and I'm practising every day for about an hour, regardless of how sucky I am. Learning something new is quite a good experience since it puts me in beginner mode. Very humbling experience.

Mind: 10/10


This year, after Chinese New Year, I bought a Fitbit charge 3 and started exercising every morning, unless I'm ill or otherwise occupied. I've been keeping to that routine for nearly 10 months and I think it is sustainable. It's the longest near-continuous exercising regime that I had ever begun, and I think it's a great start. If I'm sick, I'll just walk for an hour. I started reading up on HIIT (high-intensity interval training) and started incorporating some of it in my exercise too. If you see me cheong-ing up and down a hill in Bedok Reservoir in the morning, it could be me. Hence, this year, I've never felt fitter and more able to run after my kid when we are out. Feels very good. This is probably a life-changing experience for me, and I'm glad to have taken this step.

Started sending my son to childcare earlier this year and was soon introduced to the vicious cycle of illness. It goes like this: son gets flu bug from school, passes around to us, son recovers and goes back to school, we recovered, repeat again and again. Went to take a flu shot for the entire family, and things got so much better. Also took a miracle medication called Clarityne that relieves a lot of symptoms from flu so that I can continue to function properly despite being ill. Being able to function well in spite of illness is part of the routine for self-employed, so carrying it over to the caretaking of my child is just natural. Clarityne is an antihistamine that relieves flu-like symptoms. I wish I knew it earlier lol

I also got infected with Hand Foot Mouth Disease (HFMD) too. In fact, my whole family got it. Thankfully mine isn't that bad. I'll give myself a 9, mainly for the introduction of a sustainable exercise routine.

Body: 9/10


I've stopped doing sitting down meditation for a few years now. These days, if I need to, I'll walk and practice mindfulness. It's a very nice experience and helps to clear my head, especially during stressful period. The interesting thing I've discovered is that even playing on the piano is a great activity to practice mindfulness. It is like I went into a flow and didn't realise an hour has passed. During frustrating practice sessions, I practised on noticing such emotions arising. The only thing that I can't really control well enough yet is when I start recording myself on the piano. During normal practise I'm okay, but when the record button is pressed, things start to go haywire. I start to overthink or just get anxious. I need to work more on that because the skills are transferable and I think it's a great way to practice working under duress.

There's an interesting observation that I noticed about myself. One day, my wife and I are out in a fast-food restaurant. She accidentally spilt the whole lemon tea drink onto me. My whole pants are completely drenched. I noticed that there is a flash of surprise and then anger but it quickly morphed into acceptance. My wife was apologetic but I found the whole situation a bit humorous. It was a strange experience for me because I noticed I didn't react much to that external event, and it didn't affect my mood at all. I think a few years ago, I might have a totally different reaction.

Good progress, I think.

Spirit: 10/10

Attack of Takashi castle - SUCCESS!

Overall, I think 2019 is a great year for me. I lived a lot in this year and will continue to be grateful for what I have and the people around me. In this week alone, I had to send 2 people to the ICU. One is my elderly neighbour, who is in because of severe intestinal pain after a trip to Malaysia. He ended up having to cut away nearly half his entire small intestine out because of inflammation. The other is a family friend who suddenly developed many red rashes all over and had his airway constricted. Both are still under observation in ICU but I think the critical life-threatening period is over. Health is like a bear market - when it crashes, it is sudden and unexpected, often with severe consequences.

In the journey towards financial independence, we often hedge against a longer life, more than our money can last. Remember to hedge against plenty of money, more than our lives can last. Live a little. Appreciate the people around you. Be grateful. Don't regret.

May the new year 2020 be filled with great health, great relationship and great wealth. In that order of importance.

Monday, December 02, 2019

Networth update 2019

2019 is coming to an end, so my usual tradition is to round the year up with an update of my networth numbers and also reflect on the figures to see how the direction is aligned with what I want in my life. In general, I think 2019 is a great year for me. Stock market is generally up and I was working a lot more this year than the last, which should contribute more to my income. But I also have more expenses because my child is going to child care center. How would that affect my networth? Let's have a look.

The last I wrote on my net-worth was back in 10th Dec 2018, here. I'm going to do the same below.

There are so many ways to calculate networth, but I've always done mine this way. It's essentially assets minus liabilities but how you define assets and liabilities makes all the difference. Like in the past, I excluded the asset part of my stay-in property, but included the liabilities portion. Besides the stay-in property, my liabilities also included the car that I bought in 2018, which I'm still paying off. As usual, I'm also not going to include the value of my car in the assets part, but will include the liabilities part.

The assets part include:

1. Cash in my wallet
2. All the money in my various bank accounts
3. Cash holdings under mattress and milo tins at home
4. Money in my paypal account
5. All the money in the 3 accounts in my CPF
6. Money market fund account
7. Marked to market investment portfolios
8. Surrender cash value of whole life insurance plans

Again, I do not include the value of my 5 room flat that I'm currently staying in, and also the value of the family car that I own.

The liabilities part include:

1. Credit card bills
2. My portion of the HDB mortgage loan (total remaining loan amount divided by 2)
3. My portion of the car loan I took this year (total remaining loan amount divided by 2)

Here goes:

2014: Assets: $226k, Liabilities: $220k, Networth: $6k
2015: Assets: $295k, Liabilities: $207k, Networth: $87k
2016: Assets: $351k, Liabilities: $188k, Networth: $163k
2017: Assets: $449k, Liabilities: $182k, Networth: $267k
2018: Assets: $483k, Liabilities: $191k, Networth: $291k
2019: Assets: $560k, Liabilities: $167k, Networth: $393k


Plenty of things to be grateful for this year. The networth figure increases by 102k from both an increase in asset of 77k and also a decrease in liabilities by 24k. The bullish stock market props up my assets substantially, since it is marked to market. Also, my active income contributed to me saving more than 60k this year. Slightly less contribution coming from dividends as I take money out from the stock market but that is kind of offset by higher interest bearing accounts. All in all, the asset part is a great improvement. Liabilities dropped more than usual because I started doing partial repayments of my mortgage this year to reduce the risk of interest rate rising in the near future. I've taken steps to reduce the interest rate fluctuations by locking the interest rate for 5 yrs by repricing my loan, so that is currently still in the works. I've also reduced the duration of my loan to pay more per month. Mortgage is still the major liability that I have, so it's always going to weigh heavily in my mind until I can clear the bulk of it. Takes time.

Going forward in 2020, I expect that the stock market might not do too well. Already more than 10 years of bull run, so maybe we can expect a severe downturn in the likes of the dot com era or the sub prime. Who knows such things? I also don't think my active income will be as huat as this year, since an economic crisis usually follows a stock market crash. I'm not going to say I'll tighten my wallet and live frugally from this year on. No. I will aspire to maintain my lifestyle as much as I can without compromising at all. The hallmark of great financial planning is that things should remain as normal as possible in spite of the stormy weathers. All my defense mechanism are in place, and I remain confident that I can weather the storm and survive, then hopefully thrive in the aftermath.

Same for my networth. In spite of the uncertainties, I will strive to increase my networth. So far so good, as it had been steadily increasing since 2014. Let's keep it rising for another decade or so.

This post is just the boring financial part of how the year 2019 goes for me. I'll do a separate post on reflecting on why 2019 is such a great year for me in terms of various themes, like family, health, relationships etc.