Read? Count Down To Retire@60
With Uncle8888's fixed monthly salary; it is simple to compute his lifetime of earned income after tax from Aug 1977 to 15 Sep 2016; it is over 38 years of using his Human Asset to generate cash flow comparing to over 16 years of using his Financial Assets to build up another source of wealth and cash flow for the rest of his life.
One consolation prize after spending more than 16 years in SGX, our local stock market; he realized and quite confident on his current investing strategy and war chest; he should be able to survive for the next 5 to 10 years in the stock market unless he becomes dementia before 65 to 70.
Wealth Accumulation Rate P.A. From
Human Asset vs. Financial Assets:
Over 38 years: 68% as of 15 Sep 2016
Over 16 years: 32% as of 15 Jul 2016
The most important thing that he realized that it is better to avoid large losses than trying to win big by taking higher bet. Recovering from large losses is painful and may take a very long time just to breakeven.
Posts
Currently are you making a profit or sitting on losses?
ReplyDeleteFor the past few years, I have slowly taken back all my initial investing capital at Jan 2000 and also locked in some investment gains (i.e. trading profits & dividends)in the bank as War Chest.
DeleteGetting older and getting timid! Bo lam par.