Niemand's Journal

Where are you and where are you going?
niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Niemand's Journal

Post by niemand »

I introduced myself a while ago. The main reason I decided to start a journal is to keep myself accountable and track my progress towards my financial goal of
being able to sustainably meet all necessary cash flows without work, through non-day-job income.
I already own a (overseas) rental property outright, which provides a bit less than half of the income that I'll need to cover my projected FI expenses. As the next steps I'll attempt

1) to reduce my current expense level to my projected FI expense level by getting rid of the loan on the family home. The loan is structured as an interest only loan with an offset facility. We were lucky to obtain this kind of loan as it is normally only given to property investors.
Goal is to fill the offset account to the brim, so that the monthly-calculated interest payable on the loan amount will become negligible.

2) to build an income stream from a stock portfolio. In Australia we have dividend franking, which makes investing in dividend stocks a hard to beat income strategy when you're in a low tax bracket. I'll build the portfolio by cost-averaging into a few long-standing, low-cost, dividend-stable Listed Investment Companies (LICs).
Goal is to receive dividend income that together with my rental income will after tax cover all of my expenses less the home loan, plus a small margin of safety.

Once 1) and 2) are achieved, and if nothing else has changed substantially, I should be FI and a day-job optional. I probably won't quit working once FI, but I may take an extended break, maybe retrain and start something new. I still need to figure this out . . .

That's all for now.
Last edited by niemand on Mon Oct 29, 2018 7:12 pm, edited 1 time in total.

wolf
Posts: 1102
Joined: Fri Jan 06, 2017 5:09 pm
Location: Germany

Re: Niemand's Journal

Post by wolf »

niemand wrote:
Sat Sep 01, 2018 5:22 pm
I have a similar timeline as you, but my number is closer to 3 wolfs :oops:
I thought about posting into your journal. Well, the timeline counts, doesn't it?

And I guess, that you could even reduce the timeline, if you are able to reduce your spending (from 3 wolfs).
dividend franking
sounds good. Do you build in some "margin of safety" for the possibility that investing laws change?

niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Re: Niemand's Journal

Post by niemand »

@wolf: you are making some good points.
wolf wrote:
Sun Sep 02, 2018 1:12 am
... reduce your spending.
It's complicated as I have to consider family. DW isn't quite on the same Wheaton level as me, but we are both content with the consensus we have reached regarding joint spending.
wolf wrote:
Sun Sep 02, 2018 1:12 am
Do you build in some "margin of safety" for the possibility that investing laws change?
There are indeed changes being proposed around franking credits, but they won't impact me much, so my margin of safety is still safe... You are right though, an FI strategy that is entirely build on a revokable tax benefit wouldn't be very robust. A multipronged approach would fare much better in the long run. In my case I'm aiming for
- outright home ownership (as a way to lower expenses)
- stock portfolio income
- rental property income (this one is done)
- resilience habits/skills.

niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Re: Niemand's Journal

Post by niemand »

Update.

Financials

I've kicked off my new stock investing strategy by purchasing some ASX:AUI. As mentioned before, my goal is to cost-average into a portfolio that'll eventually provide half of the income I need to cover my projected FI expenses (the other half is covered by rental income). Status: 2% of 100%.

My projected FI expenses are pretty much my current expenses less the home loan. My other goal is therefore to pay off the home loan ASAP. Unfortunately I didn't make any progress on that front in August, but hope to catch up in the next few months. Status: 0% of 100%.

Below is a chart showing how my FI Spending Cash Base would have eroded over the last 12 months down to 41% if I had solely relied on non-day-job income. My goal is to see the downward slope of the chart turn up eventually, i.e. to see the Cash Base not eroding down but replenishing back up to >=100%. At the moment there is only rental income in the chart, I haven't received any dividends yet. Status: 41% of 100%.

Image


Habits

I'm trying to form some new habits and am keeping track each day whether I accomplish them. The way I'm keeping track is similar to how Benjamin Franklin kept track of his 13 Virtues, and the process doesn't take longer than one minute per day on my mobile phone. I'm only tracking new habits that I'd like to form, not habits that are already established, unless they start slipping.

Once a month I compile my results into a chart. The more colour in the chart, the more consistent I have been. Here are the daily habits that I am currently trying to form:

Image

As you can see, my follow-through was piss-poor in August, due to a hectic work schedule and travel. Status: bad.
I should be able to do better in September 8-)


Edit: Corrected the Cash Base chart for months 17.12 and 17.09. I forgot to include the full tax prepayment on my rental income, since I'm prepaying my tax bi-annually. I'm switching to quarterly payments next year, which will ensure there is always 4 months of tax prepayments in the chart.
Last edited by niemand on Mon Nov 12, 2018 1:42 am, edited 1 time in total.

niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Re: Niemand's Journal

Post by niemand »

Another Update.

Financials

I received my first dividend, thank you kindly ASX:AUI :D The amount is tiny, but AUI was only the first stock purchase out of many on my ongoing quest to build a portfolio that'll eventually provide more than half the income needed to cover my FI expenses. Last month I also added a new stock, ASX:ARG, to my portfolio. Status: 3% of 100%.

I managed to put some extra money into the offset account for the home loan. Still behind though due to last month's missed extra payment. Status: 1% of 100%.

Below is my Cash Base Development Chart. My goal is to maintain the Cash Base >=100%. If I had solely relied on non-day-job income over the last 12 months, my Cash Base would have eroded down to 42%. Status: 42%.

Image

My only significant non-day job income is from my rental property. Last month I had to prepay some rental income tax, which lead to a negative rental income figure in above chart for 18.09. I'm switching to quarterly tax prepayments next year, which will smoothen the ups and downs of my rental income.

As mentioned above, I received my first dividend last month. I think that's exciting, so let's zoom in to honour this milestone:

Image


Habits

I'd like to form some new habits and am keeping track every day if I have failed on them. Every month I compile my result into a chart. The more colour in the chart, the better I have been:

Image

I can definitely see progress vs. last month, especially on the nutrition, dental care, and pro-social behaviours. I also almost completely failed on meditation and could to better on the fitness side (injured my wrist though)... Not sure if I can report a better result next month, as there will be a bit of overseas family travel and therefore disruption of routine. Looking forward to it :) Status: ok-ish.

CS
Posts: 709
Joined: Sat Dec 29, 2012 10:24 pm

Re: Niemand's Journal

Post by CS »

niemand wrote:
Sun Sep 30, 2018 6:36 pm

As mentioned above, I received my first dividend last month. I think that's exciting, so let's zoom in to honour this milestone:

Image
:lol: :lol: :lol:

You should write movies.

Congrats. That IS exciting.

niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Re: Niemand's Journal

Post by niemand »

@CS: thanks for appreciating the humour :geek:

I actually did earn dividends in the past, when following different investing strategies, but these dividends were all earned in accumulating funds or DRIPped back.

The novelty for me is getting dividends paid directly into my bank account :mrgreen:

My investing backstory is as follows:
2010-13: GDP-weighted world stock ETF portfolio
2013-18: Permanent Portfolio
2018: LIC dividend income portfolio

I would go back to the PP in a heartbeat, but the tax incentives that Australian dividend stock investing provides are just too good to be ignored.

niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Re: Niemand's Journal

Post by niemand »

Just a short update this month without charts.

Financials

Everything's humming along nicely.
I added some more ASX:ARG to the stock portfolio. Status: 5% of 100%.
I put some more $$$ into the home loan offset account. Status: 3% of 100%.
Cash Base Development is unchanged. If I hadn't worked in the last 12 months, my annual spending Cash Base would have eroded down to 42%, same as last month. Status: 42%.


Habits

A couple weeks of (enjoyable) holidays and I've gone pretty much completely off the rails. I'm back to routine lifestyle now and should get some good outcomes for rest of year. Status: recovering from holiday hangover.


Garden

DW and I are planning a garden remodel with the following basic idea:
A drought-tolerant, mostly edible, perennial, low maintenance garden with an ornamental front and a toddler-friendly back yard.
Since purchasing our house we haven't done any changes to the previous owners' garden setup. It's about time we made a garden our own design. More to come...

niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Re: Niemand's Journal

Post by niemand »

Oops, looks like I skipped a month.

Financials
This is on auto-pilot.
Stock portfolio: 8% of 100% - added some ASX:ARG and ASX:AUI
Home loan offset: 6% of 100% - the usual contributions.
Cash Base Development: 41% - down 1% due to an unforeseen rental expense.

Habits
Prodding along alright except for Meditation, which I just can’t seem to get myself to do. Any ideas? Looks like some other forumites (LiquidSaphire, Quadalupe, Chenda) are also struggling.....

Garden
We have started to redo our small 150sqm suburban garden:
We removed all red-dye wood chips that were previously used as ground cover in the garden beds, took out and mulched about half of all plants, then added a few cubic meters of quality soil and pine bark mulch.
At the moment we have a neat mulch-covered front lawn with zero plants. The other day I caught the neighbour’s puppy dog pissing in it...
At the back we planted pineapple guava, pomegranate and orange trees. The existing lemon tree has been given a haircut. Some garden edging has been moved to change lawn/bed layout. Irrigation main lines are installed and connected in all garden beds.
There’s more to come but this will take more time now that the holiday period is over.
Although I only work a 4 day week my major constraint is time, as DD2, DW and many other activities take priority over the garden. There’s no rush.

daylen
Posts: 2528
Joined: Wed Dec 16, 2015 4:17 am
Location: Lawrence, KS

Re: Niemand's Journal

Post by daylen »

What do you want to get out of meditation? You may already be doing it in other areas of life.

niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Re: Niemand's Journal

Post by niemand »

@Daylen: Meditation gives me a feeling of serenity that I haven’t been able to get from other activities. Meditating is also damn hard for me and I need to overcome my mental road blocks and get into a routine.

niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Re: Niemand's Journal

Post by niemand »

Quick update

Financials
Like watching paint try. I suppose that’s a good thing......
Stock portfolio 10% added ASX:AFI
Loan offset 8%
Cash base 41% unchanged

Habits
Arrgghh! Must.meditate.

Garden
It’s the hottest summer ever recorded. I put in some more drip irrigation lines, connected some draincoil to the patio downpipe so rain water gets directed to the fig tree.
I also planted some oregano, thyme, sage, rosemary, catmint and primroses in the front yard - they’re all draught resistant.

niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Re: Niemand's Journal

Post by niemand »

Just a brief Financials update to continue tracking my progress:

Stock portfolio 12% - added ASX:AUI and received a small dividend from ASX:AFI
Loan offset 9% - still slightly behind
Cash base 41% - unchanged but ok

niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Re: Niemand's Journal

Post by niemand »

Stock portfolio 13% - added ASX:AUI, received half-yearly dividends from ASX:ARG and ASX:AUI. Dividends are getting close to 4 digits
Loan offset 11% - still lagging behind
Cash base 41% - unchanged despite receiving dividends as i had to prepay some tax on the rentals

niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Re: Niemand's Journal

Post by niemand »

Update.

Garden

Planting is complete. I acquired a bulk of the trees "used" via Gumtree, as relatively mature plants. If all plants are bearing fruit, harvest schedule should be as follows:

Spring:
Sep - Kumquat, Lemon, Ruhbarb, Keriberry, Jerusalemn artichoke
Oct - Artichoke, Kumquat, Lemon, Loquat, Ruhbarb, Kiwiberry, Keriberry, Strawberry
Nov - Passionfruit, Artichoke, Kumquat, Babaco, Lemon, Loquat, Ruhbarb, Kiwiberry, Loganberry, Raspberry, Strawberry, Avocado

Summer:
Dec - Passionfruit, Artichoke, Kumquat, Babaco, Pepino, Blueberry, Ruhbarb, Kiwiberry, Loganberry, Blackberry, Raspberry, Strawberry,
Mulberry, Avocado, Redcurrant, Cherry
Jan- Passionfruit, Babaco, Pepino, Midyimberry, Blueberry, Ruhbarb
Loganberry, Blackberry, Raspberry, Strawberry, Chili, Figs, Mulberry, Dragonfruit, Plum, Avocado, Cherry, Gooseberries,
Peach, Nectarine
Feb - Passionfruit, Babaco, Pepino, Midyimberry, Cape Gooseberry, Ruhbarb, Blackberry, Raspberry, Strawberry, Chili, Figs, Feijoa Pineapple Guava, Choko, Dragonfruit, Grape, Plum, Avocado, Gooseberries, Peach, Nectarine, Apple

Autumn:
Mar - Pomegranate, Passionfruit, Quince, Babaco, Pepino, Midyimberry, Lemon, Cape Gooseberry, Lime, Ruhbarb, Raspberry, Strawberry, Chili, Ugni Chilean Guava, Figs, Feijoa Pineapple Guava, Choko, Dragonfruit, Grape, Pear Williams, Peach, Nectarine, Apple
Apr - Pomegranate, Passionfruit, Quince, Pepino, Midyimberry, Lemon, Mandarin, Cape Gooseberry, Lime, Ruhbarb, Keriberry, Raspberry, Strawberry, Chili, Ugni Chilean Guava, Figs, Feijoa Pineapple Guava, Choko, Grape, Pear Williams, Guava, Apple
May - Passionfruit, Persimmon, Quince, Kumquat, Lemon, Mandarin, Cape Gooseberry, Lime, Ruhbarb, Keriberry, Raspberry, Ugni Chilean Guava, Choko, Avocado, Guava

Winter:
Jun - Tamarillo, Pomegranate, Persimmon, Kumquat, Lemon, Cape Gooseberry, Lime, Keriberry, Raspberry, Ugni Chilean Guava, Choko, Avocado, Guava
Jul - Tamarillo, Kumquat, Lemon, Lime, Keriberry, Jerusalemn artichoke, Avocado
Aug - Kumquat, Lemon, Ruhbarb, Keriberry, Jerusalemn artichoke


Many of my plants should do reasonably well in drought. I also planted a privacy screening from the lovely neighbours in my suburban lot: edible bamboo, 6 meters tall.


Financials

Stock portfolio 15% - continuing to DCA. Added ASX:ARG. I saw a black swan by the lake on my walk to work today, let’s hope it’s a good sign that stock will go on sale soon :lol:

Loan offset 12% - waiting for bonus to catch up

Cash base 41% - unchanged. The crux with receiving bi-annual dividends is that the coverage percentage will probably only jump up in September.

I sowed some grass a couple weeks ago. Watching grass grow at times seems to be faster than watching my financial progress.

My (individual, including home equity) net worth as % of the 2018 median wealth per adult in Australia:
2019 353%
2012 63%
2011 42%
2010 26%
2009 13%

I discovered ERE/FIRE in February 2011, when I was doing negative geoarbitrage, working in a low income country for nearly three years on a local salary :o Most of the net worth progress happened after I landed a job in Oz and had the knowledge to optimise in a high pay / high COL country. Also, I’m not really looking at SWR, but at passive income. As per my chart I’m 41% there.

Though it’s a marathon and not a race (I currently work part-time + due to my family circumstances it’s more of a Fat FIRE project), I’m quite happy with my financial progress so far :geek:


Note: edited for more anonymity
Last edited by niemand on Sun Jan 17, 2021 7:28 pm, edited 1 time in total.

niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Re: Niemand's Journal

Post by niemand »

Update

Financials

Stock portfolio 17% - added ASX:AFI
Home loan mortgage offset 16% - back on track as I dumped some of my annual bonus into the offset account
Cash base 41% - unchanged


Other

Bamboo/privacy project done, now it just needs to grow. I'm getting a bit tired of gardening these days. I still need to put 4 new trees in the ground, plant some ground cover, install borders, mulch, lay dripline and sow some grass. Ah well...

Made a bit of noise at work and was pacified with a 10% raise. I'll try to put all of the additional cash into the mortgage offset account which should cut down time to full home ownership by 8 months. Going forward above Loan offset percentage should increase faster :)

niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Re: Niemand's Journal

Post by niemand »

Stock portfolio 20%
Home loan mortgage offset 19%
Cash base 43%

kthanksbye

2Birds1Stone
Posts: 1596
Joined: Thu Nov 19, 2015 11:20 am
Location: Earth

Re: Niemand's Journal

Post by 2Birds1Stone »

Woop Woop

niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Re: Niemand's Journal

Post by niemand »

Woop Woop. Well worth a visit. If life ever takes you there look for me beyond the black stump.

niemand
Posts: 135
Joined: Sun Jan 03, 2016 3:18 am
Location: Woop Woop, Australia

Re: Niemand's Journal

Post by niemand »

This journal is now one year old. Looks like I'm 1/5 down the rabbit hole.

Financial progress
Stock portfolio 23%
Home loan mortgage offset 21%
Cash base 45% - Yay to progress, thank you dividends :D

Garden
Since my last garden update I added a quince and two persimmon trees. I'm trying to get my hands on a finger lime a.k.a. lime caviar. What would also be nice is a fast-growing, edible, drought-resistant, deciduous tree to shield the sun-facing dining room window in summer, but let the sunshine in in winter. Any ideas would be welcome :)
With the tree canopy set up, the next step is a drought-tolerant edible understory. So far I'm thinking of salt bush, chilean guava, warrigal greens, midyim berries and ebbing's silverberry. I also need to put in more dripline before it gets hot again...

Cocktails
Getting into mixology a cocktail a weekend. Last month I made and imbibed a Martini, a Manhattan and a Whiskey Buck. Focus is on lemon-y cocktails as I've got plenty in the garden. At the request of DW I also concocted an "Assam" mocktail, which is sweet, salty and sour at the same time and gives you an instant facelift when you drink it. This mocktail will be a winner next time we have some South-East Asian friends over.

Holiday
Three week holiday coming up to the mother (and father) land + a UK road trip, down memory lane.

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