Final Update for LBF

Happy holidays and happy new years! I am writing this post as I recover from a massive flu! Yet here I sit, grateful and humbled by the best year I’ve ever experienced in my life. What a year!

What a fun little 6 year project this has turned out to be! I’m so humbled at the results of not mines but some of you who have been following me since the early Instagram days that has completely changed your financial situation today. Just the top of my head:

• 11-12 of you are now millionaire status.
• All had a net worth sub 300k back in 2018. With most below 100k.
• My family includes millionaire investors!
• Nearly all my dearest close friends and family members are investors today!

Hats off to you all! Absolutely amazing and couldn’t be more happy for you guys!

Quick notes and updates!

LBF Dividend Portfolio

It was a short but incredibly rewarding ride, exceeding my initial expectations. In about 6 years, the portfolio grew from roughly $50,000 to just shy of $500,000, generating around $67,000 in total dividends. That’s about $13,000 in extra income per year, enough to cover over $1,100 a month in groceries!

Important lessons I took away from Dividend Investing.

1. Don’t Chase Yield: High yields can be traps if the underlying company’s fundamentals are weak. High yields? You better have a strong thesis backing your investment!
2. Maturing growth stocks can transition into great dividend growth stories as they begin to implement more capital return policies.
3. CEO’s who understand who they work for is important.
4. Dividend paying companies are often more stable matured companies. They bring lower volatility and predictable fundamentals that can potentially smooth out a volatile high beta portfolio.
5. Dividend stocks are aided by the large retirement class.

Dividend investing is just one of many investment strategies available. Whether it suits you depends on your individual risk tolerance. Dividend investing is one of the very first method of investing I personally learned that influenced me to become a long term investor. The allure of building a stream of passive income for life was powerful enough to suck me into the world of investing for good. I hope it did for some of you as well!

The M1 Growth Portfolio

A common myth I hear to often is that investing just a few hundred dollars a month will never amount to anything significant. That’s exactly why I started this portfolio! To show how even small monthly contributions of $100–$200 can eventually lead to something substantial like a down payment on a car!

I began in 2020 with $1,000 in principal and $100 per month (later increased to $200). Today, the portfolio has grown to around $25,000, proving that patience and a few lucky stock picks can really pay off, even if you make your share of mistakes along the way.

The important thing to take away here is that it pays to take on some risk. Choose a few names and invest in individual stocks along with your indexes. A few good picks can change your financial path!

10 Million Net Worth

Through my FIRE journey, I’ve learned a surprising truth. Some of the most rewarding experiences don’t cost much at all. You might discover you need far less money than you once imagined to feel fulfilled.

Will I continue pursuing that $10 million target? Absolutely! Partly for the challenge, and partly for my personal growth. But I also know that finding balance and savoring the present are just as important as working toward big, long-term milestones.

Don’t let any number determine your life. Once you reach a certain point in your life, that number can be set behind you. Take in the moments to awe at your garden, take the time to appreciate the ones around you, put a smile on someone’s face, just live your life and be grateful for what you have.

Random thoughts as I close out this website.

• Goals become even more important after you FIRE. They keep you focused on the future and looking forward to it.
• Retiring early isn’t the end. It’s the start of a new life with new challenges.
• In the beginning your cash flow is your hammer for building wealth.
• The best dividend investments may start with modest yields but grow significantly over time.
• It’s impossible to predict the future, so focus on how you’ll respond.
• No matter how much knowledge you have, if your emotions dictate every move, you’re in trouble.
• Less distraction, more intention.
• You’re only limited by the hours in a day and the depth of your curiosity.
• All the money in the world wont matter if your health deteriorates or you’ve lost your most cherished connections.
• A tamed mind is the ultimate success.
• Time is our most valuable asset. Use it, spend it, and share it wisely.
• Compound knowledge and shift your probabilities.

Leverage

I think I will end with a few thoughts on this topic since this is one area that can wreck someones life work and savings.

1. Never Over-Leverage
If you plan to use debt or leverage to amplify returns, it’s crucial to understand what “over-leveraging” really means. Always keep your debt-to-asset ratios in check. Some people are comfortable holding total debts below 30–40% of their net worth, but in my experience, even that can be too high. The more I’ve learned about market risks, the lower my definition of “safe” leverage has become. Today, I’d classify leverage ratios as:

• Conservative: 1–1.2%
• Moderate: 1.2–1.5%
• Aggressive: 1.5% and above

Staying below 1.2% until you gain much experience and knowledge on how market downturns and crises can devastate ones portfolio could be wise. In fact, I don’t recommend taking on any form of leveraged debt or notional obligations in derivative contracts until you have at least a $1 million investment portfolio.

2. Context Matters
What seems like a conservative leverage strategy can quickly turn disastrous, depending on various factors such as your living situation, job security, liabilities, and more. During severe market turmoil, economic struggles often ripple through households, impacting cash flows. Families may be forced to sell depressed assets at the worst possible time, and lenders can become extremely cautious about issuing new loans, even to top borrowers.

3. Liquidity Is Everything
When capital becomes scarce, liquidity can dry up for months, even years, leading to a cascading crisis. In these moments, having a safe margin of liquidity and not being overextended can be the difference between weathering the storm and seeing your investments collapse.

4. Interest Rate Risk
Leverage often involves borrowing at variable rates, which can rise quickly in certain economic conditions. Keep in mind how increasing interest costs might erode your returns or even turn a profitable position unprofitable.

5. Margin Calls and Forced Liquidation
For those who use margin, remember that a drop in asset prices can trigger margin calls. If you can’t meet these calls with additional capital, your broker may sell your positions at the absolute worst times. It’s essential to understand the margin requirements and have contingency plans in place.

8. Psychological and Emotional Factors
The stress that comes with leveraged investing can’t be overstated. Even some legendary investors have gone through the mistakes of misuse of leverage. Many discover how human we all are during major market events. Managing risk isn’t just about numbers, it’s also about peace of mind. Humans are 99.9% genetically similar, we’re all susceptible to fear and greed. Animal spirits is a real thing both ways.

9. Regulatory and Tax Implications
Different leverage strategies may have unique regulatory rules, margin requirements, or tax consequences. Know what you’re signing up for.

10. Contingency Plans and Exit Strategies
ALWAYS have a plan for how and when you might reduce leverage. For instance:

At what market conditions or portfolio drawdown level will you start trimming leveraged positions?

What’s your threshold for pain in a worst-case scenario?

Having clear guidelines can help you avoid emotional or spur of the moment decision making. Stick to your principles and never forget that mistakes are part of investing. Learn from them, adjust as needed and move forward.

Don’t fool yourself. Another major market event will happen. Make sure you’re not over-leveraged when it does. All those extra returns from the last 5–8 years can vanish in a single downturn.

In Summary

In summary, while leverage can amplify gains, it can also magnify losses. Use it carefully, monitor it, and remember that maintaining a solid cushion of liquidity is essential to surviving the unexpected. If used responsibly, leverage can be a powerful tool for the experienced investor.

In Closing

I might still post the occasional update on Instagram or other social media. This site will be shutting down in a few months once everything expires. It’s been an honor and a joy to share this journey and watch you all succeed.

Thank you for following along. I truly wish every one of you continued success not just financially, but in life as a whole. Let’s keep in touch on social!

Love,
Kevin

LBF signing out for good! 🫡