Saturday, December 21, 2013

My Investing Goal for 2014

As we draws down the rest of the days in 2013, most of us will take this time to reflect back on the things that has happened in 2013 and set a goal for the upcoming new year of 2014.

An overlook back of my investing journey in 2013 would see that I started off the year with about S$ 128,210 worth of shares. Based on the market value as of 13 Dec 2013, the portfolio value stands at S$219,130. That is an overall 71% year on year increase to my delight. Some of the major contributor to this significant increase includes:

- Active income from job (Proportion of savings rate were in the 80% range for 2013)
- Realised profits from capital gain
- Dividend income reinvested
- Other trading income from soccer betting



While 2013 was great personally, 2014 will be a different field altogether as I plan to focus on a few new things that was never present in my life previously.

1.) Life Insurance

I've decided to enhance the protection for my insurance coverage to cover life. The coverage that I have decided is S$500,000. In order to do this, I will have to fork out S$543/month for the 20 years ahead, for which I will then be covered until 100 years old. The breakeven price for the surrender value is around 25 years, by which I would have become financially freedom (hopefully, finger crossed). But I am not too concerned with this as the main objective is to provide enough coverage in case things doesn't go as planned.

2.) Child's Expense

My finally awaited long dream is about to come true. Yes, my wife is currently expecting and my child is expected to born in the mid of April 2014. While many parents are stressed over the financial issues they will have when they have kids, people who have planned well should have no issue dealing with it. For me, I am planning to accrue S$1K/month for a start for my kids expense. That will bring down my savings rate down by about 20% based on my current pay. Again, I am not too overly concerned with this. I am ready to be a father and am ready financially to give the best for my child.


3.) SMU - MBA Graduation

This has been tough for me to juggle between working and studying at the same time. I have about a year to go before I will graduate (hopefully) in Dec 2014. With the born of my child to come in 2014, I will now have to juggle even harder among the three. But I am optimistic. If people can do it, then B can do it too.

4.) Betfair $20K endowment

Let's call it an endowment shall we :D

For those who are in the same groundfield as myself, we will know what is this. This so called "endowment" will mature in May 2014 giving me a very good returns on investment. But with high returns comes high risk. Let's hope everything goes to plan.

5.) Dividend Investing purchase

My main objective is still on finding good value stocks which yields good returns for my long term portfolio. With many funds manager dumping their dividend shares and going for more growth shares in 2014, dividend investors could have opportunities to add on to their portfolios. My goal is to increase the total dividend income for 2014 to $16K/year. Let's see if the market presents any opportunity to add on to some value stocks.



Projected dividends for 2014 (based on latest holdings)


CompanieslotsDividends ($)/lotTotal Dividends ($)
FraserCenterpoint Trust301093,270
SPH72201,540
Vicom61871,122
Ascott15891,335
FraserCommercial Trust14781,092
Neratel2040800
First Reit1363819
Sembcorp Ind2150300
ST Engineering3168504
China Merchant Pacific855440
ParkwayLife Reit3106318
Second Chance1334442
Ascendas Hospitality Trust764448
Mapletree Log Trust17171
12,501


Last but not least, I would like to wish readers and each and everyone a Merry Christmas and a blessed New year ahead in 2014.



16 comments:

  1. B,

    You know what? This post is very real and human. It made me laugh and can't help flashing thumbs up to you ;)

    1) Soccer betting? You very de honest! LOL! It gives personality and life to this post. It's not about you projecting an "ideal" picture of who you are.

    2) Active income and high savings rate - I notice most will gross over this little but important detail. It's easy to give the impression you have returned a 70% gain when STI has flatlined for 2013; but you didn't. Thumbs up!

    3) Insurance, child, education - these are cash flow out activities that if avoided, could have added to your opportunity fund to drive your dividend goals.

    You have a balanced outlook. Triple thumbs up!!!

    ReplyDelete
    Replies
    1. Hi SMOL

      This is what they called trader's blood will always flow in a trader's character. Similarly the same for gambler :D

      Some of the people may have mistaken that I have returned a 70% gain year on year. This is not true. What I was just trying to say that the increase year on year ($90K) was a surprise to me. This is because assuming I am drawing $5K/month from my job and have approximately 80% savings rate, then the main contributor would sum up to $4K x 13 = $52K. This means that the rest of the $38K must have come up from either capital gain/dividends/other income. This is the part that exceeds my expectations.

      I read about your posts the other day about younger people having a goal while older people having a reflections. HAHAHA. I guess with more commitments on my plate, I must now reallocate my resources more efficiently, even if that means lower savings rate and lower dividends in the future :D

      Delete
  2. Right.

    In our first XX years, our wealth will come from earned income and higher saving rate.

    ReplyDelete
    Replies
    1. Thanks Uncle CW

      A person who can earn great returns on their investment but have very little capital to back up will end up with unimpressive returns eventually.

      Delete
    2. Hi, after investing for 3 years, I totally agree with your statement.

      "A person who can earn great returns on their investment but have very little capital to back up will end up with unimpressive returns eventually"

      Delete
  3. Hi B,

    Congratulations on being a father soon. I guess you will have no problems catering for your child. You have everything planned out. Maybe just need more time for him or her.

    Merry Christmas and a happy new year to you too :)

    ReplyDelete
    Replies
    1. Hi SG YI

      Its a promotion for me in terms of being a father :D so excited just to wait during these periods.

      I hope things are well with you amd your family. A merry christmas and we'll walk the new year in 2014 together.

      Delete
    2. Hi B,

      Just to add on. Your portfolio of 219K is really impressive. Don't mind me asking how much savings did you start with when you first started investing back in 2011? I'm really impressed how you can save so much in such a short time.

      Delete
    3. Hi SG YI

      I started off my investment with about 80K in 2011 before I accumulate further throughout with my savings from the salary. Im blessed to hv a job and salary that are pretty decent that can substantiate my goals in investing further too :)

      Delete
  4. Hi B,

    Lots of smiles when reading this post. First of all, congrats on the good news on the baby front! That's one big life event.

    Betfair endowment and 20k? You're one big player and you should be doing well, since it's referred to trading income and our team is sitting at the top of the table. =)

    That whole life insurance seems really expensive! Thought of a cheaper term alternative?

    And let's hope that we can grab some good bargains on the investing front in the year ahead!

    ReplyDelete
    Replies
    1. Hi HWW

      Your reflections post on 2013 inspired me. Cant wait to see your 2014 goal post soon.

      Thanks for the thought. I am excited to embark on a father son journey and hope you are able to bring a good news on your side next year as well.

      I wish you and your wife well amd prosper ;)

      Delete
  5. Mind do a breakdown on the amount on saving? it seem that it formed the bulk of your returns

    ReplyDelete
    Replies
    1. Hi anonymous

      My savings for 2013 are in the range of 80% based on my current pay. That is because I just got married and have more expenses than before. Before I get married, my savings rate is almost 100% each month. Thats because my current dividends are able to sustain the single life I used to live. Not now ;)

      Delete
  6. 80% saving rate is impression. i guess your family must be quite well off and you dont need to give allowance to your parents. anyway, well done young man!! :)

    ReplyDelete
  7. Hi B,

    May I ask what was your buying price for Mapletree Logistics Trust and ParkwayLife Reit?? Was thinking if it is the right moment or wait till after new year for next correction.

    Thanks.

    Regards,
    Kit

    ReplyDelete
    Replies
    1. Hi Kit

      I just bought MLT recently at the recent dip at $1, but its only a single lot.

      For Plife my latest purchase was in Aug I believe at a price of $2.36. Since then I hv collected one rouns of the dividends.

      Some of the reits may present good value like fct for instance. If you ask me, Plife current price is slightly a little high and I wouldnt want to enter at current price given current environment.

      Delete

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