~~Towards Barista FIRE~~

One month ago, I did a comparison of the performance of REITs i hold in my portfolio in this post , evaluating the impact of high interest rate environment of the REITs' earnings and distribution per unit.  In this post, I am going to just look at the performance of the share prices of the REITs in the short term (past 1 year) and medium term (past 3 years).  The following data are all taken from sg investors . Year-to-Date Performance (9 REITs in the Green) Year to date, industrial/logistics and retail REITs with at least a part of their properties in Singapore seem to perform better than others (with the exception of Cromwell European REIT), up by 0.9% to 18.6%.  However, performance is not consistent as retail REITs like Lendlease REIT and industrial REIT like Aims Apac REIT are not in the list.  One possible reason for Aims Apac REIT to be excluded from this list is possibly due to the price correction after the announcement of private placement and preferential offerings of sh

Sometime in March 2023, a study surfaced and it caused a little stir in social media.  The picture below shows the cost for an American to comfortably retire in every country.  Looking at the numbers, it's a little surprising that Singapore topped the charts, needing a shockingly high USD 1.12M (SGD 1.51M based on an exchange rate of approximate USD 1 : SGD 1.35) to retire comfortably, compared to other well-known expensive countries like Switzerland and United States, which only require USD 831K and USD 703K respectively. As shocking as it seems, I think this chart only paints an accurate picture for the average American, and not for the general population.  As a permanent residence in Singapore, I understand and experienced that Singapore has provided many subsidies and rebates for its citizens.  Examples include subsidies in housing, medical, education, and rebates in conservancy charges, transport and utilities for eligible Singaporeans.  All these definitely helped to defray t

This will be a relatively short post, just to update on the transactions for the month. For the month of May, it is a case of 2 different stories between the US Growth Portfolio and the SGX Dividend Portfolio.  For this month, the headline story is on the US debt ceiling issue, and that has definitely overshadowed the slight improvement in CPI.  Negotiations are ongoing regarding the debt ceiling.  Although the market broadly believes that the US government will not make the wrong move because of political disagreements to result in any defaults, any undesirable news out of the current negotiations will still send short-term shockwaves through the market.  On the other hand, Fed Chairman Jerome Powell has signaled that there will be no interest rate hikes in June.  However, whether this is the beginning of the pivot or not, will very much depend on the CPI numbers in the coming months. As mentioned in last month's update, analysts have commented that 1 st quarter's earnings

Google is one of the top 3 holdings in my US Growth Portfolio.  On 7th February 2023, its share price plunged from USD 107.64 to a low of USD 89.13 on 24th February 2023, a decline of 17.2% in just 2 weeks.  The reason for the decline is due to the Microsoft, another tech giant which is also one of the top 3 holdings in my Portfolio, incorporating Artificial Intelligence (AI) into its search engine Microsoft Bing and Edge  browser.  This move, though expected, came too soon and it caught Google off-guard.  In an interview, Microsoft CEO Satya Nadella said that he wants to make Google "dance" with their new chatbot "new Bing". This move definitely created some stress within Google, and that 'forced' them to push out their own version of AI, Bard.  It was probably not ready and unrehearsed, as Bard gave an incorrect answer to the question posed during its presentation.  To make matters worse, in mid-April, Samsung released news that it may have the intention t

The FIRE movement , which stands for "Financial Independence, Retire Early", has been around for quite some time.  As the movement grew, various forms of FIRE appear, including Lean FIRE, Fat FIRE, Coast FIRE, Barista FIRE etc, which I had introduced in an earlier  post , and in another post , discussing the challenges these strategies may face in high inflationary times like today.  Blogger Valuechampion also has a picture that illustrate the various FIRE. As FIRE movement became more well known to the public, it garnered much controversies.  There are little naysayers of the "FI" of FIRE, as attaining financial independence is an aim of many people, because achieving financial freedom allows individuals to have more choices in life.  However, the "RE" of FIRE has rather split opinions.   Proponents of "Retire Early" believe that retiring early will free up more time for individuals to pursue more important matters to them, such as, being able t

The REITs that I hold in my portfolio have all reported their latest earnings, therefore I think now it is a good time to review their performances to see the impact of the high interest rate environment on their respective earnings. The summary of the net income, distributable income and distribution per unit are tabulated below: From the numbers churned above, I believe the best performer is ParkwayLife REIT (PWLR), the top holding in my portfolio.  All 3 metrics have improved year-on-year, although there are other metrics under some pressure like slight increase in cost of debt and slight decline in interest coverage ratio, but generally it is still healthy overall. Capitaland Integration Commercial Trust (CICT) also showed resilient performance based on its improving net property income, and other improving metrics like improving occupancy rates and more importantly, positive rental revision rates.  However, a clearer picture will be required to assess the performance as some metri

This is a relatively short post, and just to share a very useful credit card hack I learnt from another blogger/YouTuber Sethisfy .  Some of you may have already known about this hack, but to me, it is something I just got to know, and it is very beneficial to me! For individuals with chronic conditions, regular visits to polyclinics and or government hospitals may be required for consultations and checkups.  Following every visit, there may also be large quantities of medication to collect.  For Singaporeans and Permanent Residence, despite high subsidies by the Singapore government, the medical bills still add up to a considerable amount in the long term.  As I did not do intensive digging and research in this aspect, before April 2023, I have always thought that all bills from government hospitals and polyclinics, like insurance premiums, are excluded from cashback or miles rewards of credit cards. So, it definitely came as a pleasant surprise to me, when I came across Sethisfy'

This will be a relatively short post, just to update on the transactions for the month. For the month of April, volatility has once returned. The March CPI data released in the first half of the month showed that inflation is cooling down, and that drove optimism in the markets. Investors are pricing in that the FED will pivot and start cutting rates in 2023, despite FED's repetitive iteration that there will be no rate cuts in 2023. However, in the second half of the month, jitters returned to the market almost immediately as investors are worried for the 1 st quarter earning results. Analysts have commented that this quarter's earnings may be the worst earnings by the companies since 2020. This period is always the period that I look forward to, as well as remain slightly jittery. I am looking forward to it because it signals that dividends are coming in from my local Dividend Portfolio soon, while I remain jittery because it will cause the share price of my shares in

In mid April, the Monetary Authority of Singapore (MAS) paused its monetary tightening policy and maintained the current rate of appreciation of the Singapore dollar.  This meant that MAS will not strengthened the Singapore dollar further to tame inflation, in a bid to defend the slowly economy, which is facing a deeper risk of slowdown.  This is supported by advance estimates which showed that the Singapore economy just grew by 0.1% year-on-year in the first quarter, a sharp decline from the 2.1% growth in the previous quarter.  On a quarter-on-quarter seasonally adjusted basis, the Singapore economy shrank by 0.7% in the first 3 months of 2023.  This means that if the Singapore economy decline again in the second quarter of 2023, Singapore will be in a technical recession. MAS believe the above policy is justified because while inflation still remains elevated currently, data shows that core inflation will continue to fall in time to come as the 5 successive monetary tightening moves

This is going to be a relatively short post, as I just want to update my latest decision with regards to my Central Provident Fund (CPF).  The information here has been verified and workable after clarification with CPF board, but only for self-employed persons.  Thus, kindly note that this is not applicable for everyone. Earlier in January, I wrote a post stating my intention to do voluntary cash top-up of SGD 1.2K per year to my Medisave Account (MA), to boost my medical protection, and to grow my CPF account at a risk-free rate of 4% (barring any unforeseen policy changes).  This decision was made because once Basic Healthcare Sum (BHS) is achieved, any additional CPF contribution will flow to Special Account (SA).  This will in turn boost my retirement amount at a risk-free rate of 4% as well.  However, after further calculation and estimation, the usual contribution based on CPF allocation rates will mean that it may take approximately 2 more years before I can reach the BHS numb

With the recent financial turmoil on-going, which includes (but not limited to) high interest rates, high inflation, shrinkflation, bank failures, company bankruptcies, mass layoffs etc, it further reminds us the importance of being financially prudent, and be responsible towards our personal finances.  This is highlighted recently by the Channel News Asia Talking Point program on " Millennials & Gen-Z: Young and In Debt.  Why? "  In order to be financially prudent and responsible, protective measures need to be in place to help us tide through any emergencies and unforeseen circumstances.  As such, I think it is crucial for me, and for anyone interested at this juncture, to relook into our personal finances to evaluate how satisfactory our financial safety net is, so as to ensure that we are on the sustainable financial journey. The base level is the 'Protection of Income'.  This, in my definition, includes insurance and emergency funds.  For myself, as I am sing

Recently I came across a post on InvestingNote sharing 7 Singapore-listed Companies That Pay Out Increasing Dividends Over The Last 5 Years .  As a major follower and practitioner of dividend investing, I would love to do a similar comparison as a quick check of how the stocks and REITs in my portfolio are doing.  Although dividends per unit (DPU) is not a sole consideration in the evaluation of the quality of the stocks and REITs, but it is one of the important metrics to look at, and it is definitely a much more dependable metric to consider compared to dividend yield.  This is because DPU can only increase if the company or REIT is generating sufficient net income or profit to payout to shareholders (however, it is important to note that a payout ratio of more than 100% is a red flag), while dividend yield can increase solely because the share price is declining, which is not a healthy indicator of the stock or REIT.  As such, I think it will be prudent for me to relook into the sto

This month marks the end of the 1st quarter of 2023.  Thus it's definitely a good time for me to record the performance of my portfolio to track how it has been. To recap, I started my SG Dividends Portfolio in late 2017, and I began tracking the dividends and all reinvestment done starting 2018.  To date, my SG Dividends Portfolio consist of banks, REITs and defense technology.  On the other hand, I only started the US Growth Portfolio in late December 2021. Currently, my US Growth Portfolio consist of mainly big tech names, bank and exchange traded funds (ETFs). Being a relatively conservative investor, I prefer to dollar cost average (DCA) into the market to slowly build up my portfolio.  The advantages of using Interactive Brokers to buy the US shares via DCA are undoubtedly the low fees and ability to buy fractional shares of mega-cap technology shares like Alphabet and Tesla.  The latest FED meeting in March showed that the FED will unlikely pivot in 2023 because despite in