Read? Stable Consistent Income Versus Variable Volatile Income
Thank you! SMOL for explaining. Read? Freehold Investment Income?
Read? Vision 2028 As Panda/Koala Investor In Local Market SGX - Reaching Investing Nirvana!
Why earned Income is NOT Sexy in the Investment Blogosphere?
How many blog posts in the investment blogopshere mentioning their earned income after tax have generated far more cash than their investment portfolio?
Why? Why? Why?
Singapore Man of Leisure11 September 2021 at 01:13
hyom,
You regular and know my "bawu", so its gloves off!
I shoot my mouth first, then beg for forgiveness...
LOL!
All in good fun :)
For most people, a stable and consistent paying job IS already a safety net!
When we are in our comfort zone, why take risks?
Unless there's a "catalyst".
Read? More related posts
Nothing motivates a man more to embrace risk taking than after getting dumped by his girlfriend for another richer man!!!
To me, safety nets are hygiene factors, not motivating factors ;)
-------------------------------------------------------------------------------------------
Is our lifetime of earned income more sexy than our investment portfolio total return?
At least sexy for Uncle8888!
Posts
Hi Uncle8888,
ReplyDeleteEarned income is not sexy because it's what almost all of us have been hearing from parents & elders for years and years. 🥱
It takes hard work. It take sacrifice. It takes too long. ;)
They want big bucks, fast! And with little effort. Maybe 1 hour per week, max LOL.
They don't want to have Buffett-level wealth at Buffett age.
They want to have Buffett-level wealth in their 20s & 30s. YOLO man!
Even the most conservative "masterclass" is being promoted on having "replacement income" either immediately or within 1 or 2 years.
If it's going to take as long as a career ... they won't have any students! ;)
I estimate my total returns (realised & unrealised, dividends, coupons) from 1999-2021 investing has reached double my employee income from 1993-2008 (yeah, I'm a semi-failed employee kekeke).
BUT ... I still consider my investment income as EARNED income. It's not like I can totally stone out on holidays and Netflix while expecting my investment to keep going up with no effort! (ok, some of it, but only some! LOL)
And it's pure LUCK that I stopped working when this current secular bull market was being borned in the ashes of GFC.
Earned income and dividend are the same. They are incoming funds for one.
ReplyDeleteNo different as per my perspective.
WTK
Below was what I shared on SMOL's blog (with some edit) :
ReplyDeleteWow, quite a lengthy discourse on this subject matter -- stable income versus variable income, with many interesting views.
Let me add my views ("experience") to the discourse. I am in rather stable job. Like many of my colleagues, this would be our only job in our lifetime. Boring right? It is what it is. The longest serving record went to a 45 year veteran. She retired at 70. Myself? I have just completed 35.5 years of service. Our earned income was (very) low in the early years in exchange for job stability? But things have become (much) better in recent years. You simply cannot sell "job stability" to the young ones. Unlike us old goats, the young ones are not enamoured with job stability / security. They want action and the money as quickly as possible.
I started investing (in stocks) seriously when I was 50! Before that, I invested in properties. Investing in properties was what people in stable jobs do back then. While my seniors bought landed, I could only afford apartment and condos. It is what it is. You do you.
For most of us (I am really speculating what my colleagues are thinking here), we invest NOT because we wanted out of jobs, but because of the "success" stories we hear and read of "snake oil" marketing. We wanted that Merz, that carefree and "paid for" vacations that dont touch our savings, that opportunity to retire early.....the list goes on. (Edit : And the investment seemed to pay off. Our passive income grew steadily from $46K in 2011 to $196K in 2019. And it came down to $182K last year due to impact from Covid lockdowns. And yes, we did buy a new SUV (though not Merz), renovated our home and went on a two week vacation in S Korea in 2019, all to the tune of $160K, well within the $196K passive income for that year.)
And I am glad I started that investment journey albeit late. The many readings that I "forced" myself to do to invest have broadened my mind. I learnt the benefits of creating and having multiple streams of income (I now have 5), the many investment options out there, risk management, passive versus active investment, ownself invest versus professional funds, etc...
For all the "troubles", at least now I feel more secure and confident (financially) to face retirement.
mysecretinvestment,
DeleteYou started late, but you had the edge over us with lesser means who started earlier ;)
To get a safe, stable, and consistent passive income of $100K per year, you "just" need to throw in $2.5 million into that savings vehicle that give 4% interests, and you got your $100K passive income per year!
For street urchins like me, I cannot think in terms of single or double digit % returns.
I need to think in terms of EXPONENTIAL compounding returns - 2 baggers, 5 baggers, 10 baggers ;)
That's the beauty of diversity!
8 immortals cross the Eastern Sea - you do it your way; I do it my way :)
Earned income is not sexy in investment blogosphere because it is the norm for earned income to exceed investment income.
ReplyDeleteWhen investment income exceeds earned income consistently, big capital size is usually the reason. This is not a sexy reason.
Amazing investment skills would be a sexy reason. Unfortunately, many people who boast about impressive returns turn out to be snake-oil salesmen.