You know what is amazing about financial freedom? When you are sick, you can rest as long as you wish! It’s times like these when you really appreciate the freedom you get from FI.

Just confirmed that I got covid.

It’s like catching the flu but lasts 2-3 times longer to recover. Recovery has been brutal but after 5 days things are settling down. My cough and headaches remain but are much less severe. Stay safe out there guys!

Anyhow, let’s take a look at how this current market turmoil has ravaged my net worth shall we? 🤧🤧🤧

 

My Baby Steps Towards $10 Million

Investments Goals

• 2020-3: Generate $10,000 in dividend income
• 2020-3: Invest at minimum $1,500 per month into the dividend portfolio.
• 2020-3: Reach a $50,000 Fundrise Portfolio.
• 2020-5: Maintain steady portfolio growth between 6% to 12%
• 2021-9: Invest $200 per month into M1 Growth Pie.
• 2020-6 to 2021-9: Invest $100 per month into M1 Growth Pie.

Income, Cash Flow, & Saving Goals

• 2020-3: Achieve positive cash flow every month of the year.
• 2020-5: Increase annual income by 6% every year.
• 2020-6: Maintain long term average savings rate at or above 30%.

Net Worth Goals

• 2020-6: Maintain Net Worth CAGR above 6%.

 

Generate $10,000 in Dividend Income

I may complete this goal by the end of this year. However, I anticipate a temporary cut to payout from some holdings is possible which could set me back for a few months. The cut is something that I welcome especially if the markets will be recovering rapidly. It’s a possibility and I am fully aware why management would make the call. Luckily, I am not dependant on this portfolios income at all so it will not affect me. All the income from this portfolio is already being all reinvested right back into itself. But because of such scenarios, it’s important to remind yourself never to rely on any single source of income, especially when you FIRE.

 

Invest at Minimum $1,500 per Month Into The Dividend Portfolio

The LBF Dividend Portfolio had a total net inflow of $20,813.07 YTD ($3,468.84 per month average) by the end of Q2.

The monthly contribution is only higher than usual due to the market correction causing me to deploy more cash.

 

Reach a $50,000 Fundrise Portfolio

• Q1 2022 – Dividend payment was $165.15
• Q2 2022 – Dividend payment was $159.39

• There has been an update to the share price from $13.08 to $15.15 an increase of 15.8%. I anticipate a slowdown in the pace of increase in share price for at least the next 2 years.

Total value of my Fundrise investments has reached $46,762.88. I can smell 50k just around the corner! The best part is I rarely deployed additional cash into this investment to get to where I am today.

Interested in Fundrise? Sign up using my referral link and get started!

 

Maintain steady portfolio growth between 6% to 12%

We are nice and deep in the RED! 🤧🤧🤧

By the end of Q2, my total investment portfolio was down nearly 27% ytd. Massive drops in some of my top holdings really took a toll on this years performance. I decided early on that I was not going to sell my largest core holdings due to the tax implications I would incur so I decided to pick up MORE shares as the prices fell.

I find myself far more excited about the opportunities this market may present than how red my portfolio looks at the moment.

 

Invest $200 per Month into M1 Growth Pie

Growth stocks continued to get slammed. Luckily, this account is very young and if I was as young as this account, I would lean heavier into growth. Well… actually i have always leaned growth most of my investing life. 😌

You can check out my updated pie here! Sign up free and get $10 free! Sign up with M1 Finance!

 

Achieve positive cash flow every month of the year

I had a massive tax bill for April even with the tax deposits made last year. I saw this coming but taxes suck. Other than that I should have smooth sailing unless murphey decides to visit!

 

Increase annual income by 6% every year

Income is down -17.4% yoy. That is slightly better than what i reported last quarter which was down -22.5%. The drop in income was expected due to the massive windfall income from last year. I expect to close the year with my income down between -5% to about -15% for the year.

 

Maintain long term average savings rate at or above 30%

Again, taxes did a number on me. We are only half way through the year so I’m not too concerned about getting back near the 30’s.

 

Increase net worth by at minimum 6% annually

Snapshot of net worth from Personal Capital. Sign up using my link and get $20.

Net worth YTD: -4.1%

 

In the last 15 years, my net worth has fallen in the red 2 other times. Once in 2009 (-16.4%) and the other in 2018 (-12.4%). Will this year be another negative year? Possibly. And if it is another red year, so what? You can’t expect your net worth to grow every single year for the rest of your life. You win some and you lose some. Thats life. I am far more grateful for the life I have than fretting over a red year.

I do find myself still cautiously optimistic about the outcome of this year. In 2009, a drop in my net worth was met with a rebound of 102.4% the following year. Luckily, thanks to heavy investing at an ideal moment in time, it really helped me hit some nice home runs in that year. Will we get another massive bounce? Very few people believe that to be a possibility as market pessimism continues to remain high. However, I find the current state of the markets may present some of those so called opportunities of a lifetime. That is if we do get some clarity and better outlook to the issues plaguing the markets. It is a matter of time I would say and what is a few quarters needed for clarity? I have years ahead of me.

The worst case is that the markets will tread sideways for the next 2-3 years. That is not the end of the world for me. All this means is the window of opportunity to accumulate quality shares of businesses simply remain open longer. And as a long term investor, I am more than fine with that.

 

ETA 10 Million

Based on current trends, projections and expectations for future growth, my best to worst case scenario towards a $10 million net worth will be the following:

How many years will it take to reach $10 Million net worth?

18 to 34 years 

By what age?

Between 59 and 75

A few more tweaks to my expectations and we have another 1-2 years added to my estimations. That is the market and economy for you, unpredictable and filled with surprises just like the wind!

“You can’t direct the wind, but you can adjust your sails.”

And adjust my sails, I shall do!

 

Final Thoughts

The pace in which housing prices have climbed the last 2 years really reminded me of how quickly home prices climbed before the financial crisis. I do not believe this is sustainable regardless of the supply demand issue. A correction is likely in the housing markets, auto markets, and even the jobs market. I hope nothing too severe but perhaps a great opportunity to buy a car is around the corner! Been in the market for nearly 2 years but I was NOT going to contribute to the madness. We shall see friends!

That wraps up the update! Time to sleep! 🤧🤧🤧