~~Towards Barista FIRE~~

Many investors like to think that the stock market returns about 7 to 8% a year over the long run, and for S&P500, that number was about 10%.  That sounds reassuring, and it is often used as the basis for retirement planning.  But these averages can hide an important problem.  Two investors can experience exactly the same average return over 30 years and still end up in very different financial positions, simply because the good and bad years happened in a different order.  That is sequence-of-returns risk, or SRR. What Sequence-of-Returns Risk Actually Is Sequence-of-returns risk is the risk that the order in which investment returns happen matters, especially when you are withdrawing money from your portfolio.  Imagine two retirees who start with the same portfolio, withdraw the same amount every year and experience exactly the same set of returns over 25 years, just in reverse order. Retiree A experiences a major crash in year 1, followed by a long...

I recently sold my position in the UOBAM Ping An FTSE ASEAN Dividend Index ETF (UPD) after holding it for less than a year.  I collected one distribution, sold at a small profit, and gave up the next payout.  When I first bought this ETF, I thought I was diversifying.  Looking back, I think I was actually di-worsifying. Why I bought UPD The idea was quite simple.  I wanted to diversify beyond Singapore, and at the same time, I wanted to increase the yield of my portfolio.  UPD ETF seemed to do both.  It was a dividend-focused ETF covering five ASEAN markets, namely Singapore, Thailand, Indonesia, Malaysia and the Philippines, and it was targeting a distribution of at least 6% a year for 2026 and 2027. On paper, that sounded attractive.  I already had a large Singapore dividend portfolio.  Hence adding some ASEAN exposure and collect a decent amount of income along the way sounds sensible, especially when it included some larger economies in the...

This post is just for personal reference, to record my personal income and expenses in my journey towards Barista FIRE. For the month of September, it was another simple month for me.  Simple life, simple expenses.  However, occasional spending spiked because I have exchanged some funds to MYR when exchange rate was favourable, above SGD 1 : MYR 3.20 in preparation for the annual insurance premiums I need to pay for at the end of the year.  Besides this large one-off expense, the others were just expenses for annual health check-ups and some other miscellaneous spending in preparation for the upcoming trip with my mum and aunt. Besides expenses, I also receive 'bountiful' dividend harvest this month from REITs and other stocks in my portfolio, and that concludes my Q3 dividend harvest.  Looking forward to the final quarter's earnings and dividends, and hoping I can achieve my annual dividend goal for 2026.   All in all, after 9 months of phase 1 Barista ...