Last year, we were working towards 80/40 goal and this year, we achieved twice that.
This much thanks to the stock market. Our annualized return since the beginning of our investment journey went from -1.3% in Jan to +17.1% in Dec. We got lucky after losing money for so many years in the market.
What's more, we have achieved the "magic number" we set for ourselves a few years back - the number we believe would be sufficient for our retirement, way ahead of our planned timeline.
So we have achieved some level of Financial Freedom. Hooray!!!
Of course, the year could have been better.
For 1) we sold our positions way too early. If not, the numbers would have been much crazier.
For 2) we missed Gold as an investment vehicle. We tried a few times but failed to pull the plug in the end. The outcome is that our total net-worth in terms of Gold is still lower than the peak in 2024. Gold, the yellow metal, showed the world its magic power!
In 2026, we will strive for higher.
For 2026, we will continue focusing on what we can control and influence - work hard, increase active income, stay invested, take care of family and health, and strive for higher achievements!
Last but not least, a huge thank you to all my readers! Wish you a Happy and Prosperous 2026!
In today’s ever-changing economic landscape, uncertainty has become a constant companion. From global market fluctuations to unforeseen events, financial stability can be challenged at any time.
However, by cultivating financial resilience, individuals can not only weather economic uncertainty but also thrive amidst challenging times.
Let’s explore the concept of financial resilience and provide practical strategies to help you strengthen your financial foundation.
Financial resilience is the ability to adapt, withstand, and recover from financial setbacks or unexpected events. It involves developing a proactive and sustainable approach to managing your finances, allowing you to maintain stability and make progress towards your financial goals, even in times of economic uncertainty.
To achieve that:
Build an Emergency Fund: An emergency fund acts as a safety net during unexpected financial crises. Aim to save three to six months’ worth of living expenses in a separate, easily accessible account. Start small and consistently contribute to your emergency fund until you reach your desired goal.
Diversify Your Income: Relying solely on one source of income can be risky. Explore opportunities to diversify your income streams, such as starting a side business, freelancing, or investing in income-generating assets. Diversification can help mitigate the impact of income loss during economic downturns.
Create a Realistic Budget: Developing and adhering to a budget is crucial for financial resilience. Assess your income and expenses, prioritize essential expenses, and allocate funds towards savings and debt repayment. Regularly review and adjust your budget to align with your financial goals and current circumstances.
Minimize and Manage Debt: High levels of debt can hinder financial resilience. Prioritize paying off high-interest debts and consider debt consolidation strategies to lower interest rates. Strive to live within your means and avoid accumulating unnecessary debt.
Invest for the Long Term: Investing can be a powerful tool for building wealth and increasing financial resilience. Develop a diversified investment strategy aligned with your risk tolerance and long-term goals. Stay informed about market trends and adopt a long-term perspective to navigate short-term volatility.
Practice Risk Management: Protecting yourself and your assets is vital for financial resilience. Review your insurance coverage, including health, property, and life insurance. Consider an emergency fund for unexpected expenses not covered by insurance. Regularly assess and update your coverage as needed.
Continual Learning and Skill Development: Invest in your personal and professional growth to enhance your earning potential and adaptability. Acquire new skills, stay up-to-date with industry trends, and be open to exploring new opportunities. A growth mindset and a willingness to learn can contribute significantly to financial resilience.
Financial resilience empowers individuals to navigate economic uncertainty, adapt to changing circumstances, and thrive in the face of challenges.
By building an emergency fund, diversifying income, creating a realistic budget, managing debt, investing wisely, practicing risk management, and investing in personal growth, you can fortify your financial foundation and cultivate resilience.
Remember, building financial resilience is a journey that requires consistent effort and adaptability. Start taking steps today to enhance your financial well-being and position yourself.
To achieve financial freedom and retire early, you need a solid plan. Start by setting clear goals and objectives. Identify how much money you need to live comfortably and what you need to do to achieve that goal. Set a timeline for achieving your goals and make a plan to get there.
2 — Save aggressively
One of the most important steps in achieving financial freedom and retiring early is to save aggressively. This means living below your means, budgeting wisely, and putting aside as much money as possible for your future. Start by automating your savings, setting up a retirement account, and eliminating unnecessary expenses.
3 — Invest wisely
Investing your money is essential to achieving financial freedom and retiring early. Learn about investing and develop a diversified investment portfolio that suits your goals and risk tolerance. Consider consulting with a financial advisor to help you make informed investment decisions.
4 — Increase your income
To achieve financial freedom and retire early, it is important to increase your income. This can be achieved through a variety of means, such as starting a side hustle, pursuing a higher-paying career, or investing in real estate. Consider multiple streams of income to increase your financial stability.
5 — Live frugally
Living frugally is an essential aspect of achieving financial freedom and retiring early. It means learning to live within your means, cutting unnecessary expenses, and making smart financial decisions. This doesn’t mean you can’t enjoy life or have fun, but it does mean being mindful of your spending and living below your means.
6 — Stay motivated
Achieving financial freedom and retiring early can be a long and challenging journey. It’s important to stay motivated and focused on your goals. Find support from family, friends, or a financial advisor who can encourage and guide you along the way.
In conclusion, achieving financial freedom and retiring early is possible, no matter your age.
It takes dedication, hard work, and smart financial planning. Start by setting clear goals, saving aggressively, investing wisely, increasing your income, living frugally, and staying motivated.
With these steps, you can achieve your dreams and enjoy a financially secure future.
And always remember the key in that phrase is “Freedom”.
We might struggle between what we really want (assuming we know, which is a big IF) and what we are required of (like providing for family) or even what we are expected of (like success as society/culture defines it).
Once we have chosen what to focus on, it could be hard to stick to it.
A lot of factors are at play here too.
But one helpful way is to get into a circle with similar focus.
In the circle, we get the right atmosphere to stick to our focus and we might get help when needed.
All that makes it easier for us to stick to it and sometimes can be the difference between making it through and giving up half way.
It is easy to forget it is a long game for most people.
Income -> savings -> investment -> financial freedom
It is a journey and it is a long game.
We need to increase our income. No one can save if they can only get their ends met.
We need to increase our savings % against income. Here we can have some control. Once we meet our basic needs, we can decide to spend less and save more.
We need to put our savings into investment. Here is where uncertainties kick in and they could be overwhelming. I know people who made big bucks in investment and I know people who only expect to beat inflation by investing (They have fat pay-checks enough to get them where they want to be, without the need for investment returns). I of course know people who has lost big in investment, a.k.a ME!
But financial freedom can be quite certain with time if we just keep at it and stay vigilant.
We chatted for a long time, from work to life to investing to future plans.
My colleague was very talkative and he was a very confident man.
So when the topic came to retirement and financial wellbeing, he confidently elaborated his status.
He was in a very good position financially and he saw himself being able to retire with enough money before his planned retirement age.
He had a million dollar plus apartment, fully paid
He had stock investment with good performance, for which all he needed to do was not touch it until retirement, meaning he would not need to put in more money to it and it would be enough for his retirement.
He of course had cash
He also would have pension from his government after retirement, which would be enough to cover basic needs
So he was very confident and relaxed.
He would not be looking to make more money. Life style is more important to him. I think he would not be able to understand if I had told him that I was working the job and some extra commitment at the same time, pushing my average daily working hours to 14 hours.
He had some quite expensive toys.
He rented a 5k+ per month apartment here in Singapore.
Another observation I got was that he was generous.
One of the common colleagues of ours were out of the country and needed his apartment checked.
So he went. Apparently, the key had been passed to him.
I needed to shake all the steak anyway. So I went with him.
We walked and talked along the way.
When we reached the apartment, we were greeted by a lock out of battery.
We could not open the door.
We called the guy overseas, explained the situation and he promised to come back with the battery.
Would I have done it for the guy overseas?
Probably not and probably the guy would not trust me with the keys either.
They knew each other for much longer for sure and they almost always stood together against a common boss.
But that trust and commitment does not come easy.
I also think the culture plays a big part.
None of the local colleagues has relationship of that level with them. And I can imagine I could feel more comfortable doing that for a Chinese guy also.
But I do get a sense of sincerity and content out of it.
I am happy with my life
I have the spare emotional and physical capacity to help you
And I want to help you.
None of this would feel the same way if one is not happy with his life.
Fate does not only determine where we will end up, but also how we will get there.
At least, it feels like that sometimes.
I had a chat recently with an ex-colleague, who I am working with now for the next month or so.
Like me, he was in a very comfortable position in life.
Like me, he could not just enjoy it, feeling it was wrong and insecure to relax like that.
Like me, he “got out of his comfort zone”.
Unlike me, he did not experience any major set-back.
But like me, he was also struggling a bit, questioning himself why he could not just go with the flow and had to put himself in the struggling situation.
On the contrary, I also know people who are really good at enjoying life.
They may not make a lot of money, but they feel everything is in control. Even if something goes wrong, they just know that they will be ok.
I sincerely admire their sense of security and how relaxed they are.
I cannot help thinking sometimes that this may be the right way with life.
I tried to categorize the two types of people based on the background or traits, which did not really yield any convincing results.
If anything, first-generation immigrants exhibit more behaviors towards the former, while locals with big families tend to lead towards the latter.
This makes logical sense though.
Immigrants have to sort out many things all by themselves in the new environment, while having a big family locally means help and support on many issues, big and small.
We are officially concluding Q1 2021. And I cannot say it is a good ending. My account is literally bleeding.
Here comes another monthly update of our Net-Worth.
It is red!
Net-Worth increase from last month: 4.45K SGD, 0.64KG Gold
The number could be inflated, because my wife did not have time to calculate her investment performance yet for this quarter and we knew it was not going to be as good.
So the real number could very well be negative. We will account for it in the next month update, because I do not want to miss the update this month.
Overall, the loss in the stock market really made us bleed.
Since I changed my investment approach, this month marks the largest loss.
From a gain of more than 60K to a loss of ~20K, it has been pretty incredible.
Again, it is time to fear the market and know our limit. Money is not easy after all!
During the drop, I tried to catch the bottom and failed pretty badly.
I added position during the initial period of the fall, thinking this is just a temporary set-back and a buy opportunity. So the top up was at very high prices.
Apparently, I was so into the bull market that I did not even think about the possibilities of a significant fall. I caught the wave up when I changed my investment approach and increased confidence every time the market robustly regained losses and kept rising to a point that I believed that the rise would not stop.
And then, with limited war chest, I became very careful in topping up. And of course, that caused me to miss the bottom.
When the market kept rising for a few days, I started to regret.
And then I entered the market aggressively with my little war-chest, believing the bottom was close at least, only to experience another 20% fall.
Once again, timing the market did not work out for me.
However, overall, my emotional management improved a lot this time around.
I did not feel the anxiety and I managed to convince myself to have patience.
I can say that my life was not affected by the fall most of the time.
I think this had much to do with the fact that I had been busy, with work, freelancing, start-ups and interviews.
The feeling that I am able to earn more money from different sources and I am actually doing something extra really helped give me confidence and emotional resilience.
Therefore, being idle really is a good way to get people wasted.
