I feel pretty motivated these days to write about a few more things that are on my mind, and one of these things is something I consider pretty important. My family.
Now, we don’t know the future. We don’t know how things will turn out, and as my anti-FIRE friends like to say: If you die tomorrow, all your work was for nothing. That is true. Sad, cruel, maybe somehow sarcastic, but nevertheless, true. As investors, we are almost obliged to be positive and to see a bright future ahead. Otherwise, what’s the point? But obviously, it is still possible that something happens that we didn’t expect or simply didn’t put into equation.
An accident, a sudden death, a divorce, family wars, or just anything that might disturb the peace, harmony, and the bubble that we feel comfortable in at this very moment. So, while it might be difficult to control most factors and possible drama around that, we can make sure of one thing: That no matter what happens, everyone will be more or less protected financially.
For this reason, I have added another 2 goals to my 2019 targets: Building up of two additional stock accounts. One for my daughter and one for my wife.
The one for my wife will be income oriented and focus on high-yield-dividend stocks. Since my wife is Thai (and we are living in Thailand), and to make sure to keep things as straightforward as possible and easy with the tax office, I will dive deep into the Thai stock market and setup a pure Thai stock portfolio. It will be an interesting ride.
For my daughter, I plan to create a mix of income and growth with my broker in Germany. A rather smaller amount will be put in some monthly paying stocks, which should cover her future pocket money requirements. And a little larger amount into a few growth stocks that may potentially help her to reach my current target at a significantly earlier stage in her life. While I plan to reach F.I.R.E. by 45, I believe she should be at least F.I. by her 30s. Being only 3 years old, she got a 27 years head-start. It should be do-able.
I started purchasing some first stocks for my wife last year, just to get to know the market and to understand trading patterns, with very small trading amounts. The great thing in Thailand is, that trading cost is extremely low. While our American friends already enjoy super-competitive trading platforms with very low cost, most European counterparts tend to be pretty expensive, with usually a minimum charge of around 8-10 EUR for a 1000 EUR order. Well, in Thailand, we are literally talking pennies, so you can even start with as little as 50-100 EUR to invest almost without any effect on your performance due to purchasing and selling cost.
Another great point of setting up a trading-income account in Thailand will be, that it will help us to reduce our currency exchange risk. When the time comes that we will start to actually use the generated income from the accounts, we will have the luxury to use EUROS when the exchange rate becomes more favourable again, and to use Thai Bath in case the EUR keeps trading low.
Obviously, in case anything should happen to me, or any single one of us, everybody will be still protected with some source of income to make it through the roughest times.
No matter how I see it, there is only a win-win there.
Again, my anti-FIRE friends might argue, that an insurance is better suited for that. I disagree. Not only have stocks a life-time-income and growth potential far beyond what an insurance can offer, it is also uncomplicated, without any small-lettered-exceptions and conditions, it is unbureaucratic and lastly, it will also help to educate my entire family financially to a point, that is far above average.
For example: I will keep re-investing the profits from my daughters account back into her account on a regular basis. When she starts withdrawing cash from the income for her pocket money purposes, let’s say at the age of 10, she will always receive a choice: Get the cash, or re-invest it, to increase her future income. She will not get any pocket money increases from me, it will be all her own decisions. No need to say that same will go for my wife 🙂 Well, if put the cash into the right stocks, she will automatically benefit from any dividend increases – and suffer from dividend cuts in case they occur.
We are 3 weeks into 2019, this means 49 more weeks to go. Time is short, let’s make the best out of it.