2020 – Here we go… with Virgin Galactic!

Ah, when I thought 2019 couldn’t get any better, something exciting happened yesterday. I really don’t know how I could have missed it, but one of the most exciting companies in the world just entered the stock market through an IPO last month and I purchased a few shares just yesterday.

I am talking about Virgin Galactic (SPCE). I know. It sounds like one of that Tesla (TSLA) pipe-dreams. But wait, Tesla… did happen. The stock is at an all-time high, the company starts regularly to report profits, is expanding its business and factories across the globe, and despite all the negative sentiment and oil-mafia-propaganda, the business is growing immensely. I have traded a very small amount of shares of Tesla every once in a while and collected nice profits in the 40-50% margins from it. Unfortunately last time I definitely sold off too early. Well, timing is always a challenge.

But enough. We all know what Tesla is doing, so how about Virgin Galactic? Is it really just some smoke and mirrors about traveling to space? Or is there more? Let me tell you ahead: Preparing humanity for space travel has much larger and wider implications than one would imagine, and a company devoting itself to this kind of adventure, being backed by a billionaire (Sir Richard Branson), might be a large risk, but also a great opportunity. Let me point out a few things why SPCE is such an exciting investment:

The Engine

The first thing that is necessary to allow us to travel to space is a proper engine. Our current engine technology is impressive, but not sufficiently strong and not sustainable enough to allow us to travel out of orbit and much further. It also doesn’t provide enough speed and propulsion in space. A significant improvement on that front will be necessary to reach the dream of safe space travel.

But better engines will also have an effect on almost all our existing technologies, from cars to motorbikes, planes, and boats. It will also have significant implications for our planetary travel as we know it. Traveling through space would allow us to cut down on flight times across the globe in unimaginable ways. A flight from Bangkok to Berlin could be cut down from 11 hours to an estimated 1 hour. The potential is huge and has been already expressed not only by Virgin Galactic but also by Space X and Elon Musk.

Protective Gear & Equipment

Leaving the protection of our planet will expose traveling humans to all kinds of dangers. Radiation, heat, cold, space debris, pressure, oxygen control… we will be forced to develop all new kinds of protective materials to help us not only master getting out of orbit, but also to survive in truly hostile environments like on the moon or on Mars.

Again, these kinds of materials, that will be very durable, strong but flexible and protect from visible as well as invisible dangers will have massive implications for us on the ground. The obvious potential for military equipment is one thing, but also research and development teams, engineers and explorers will see a whole new world open up in front of their doorsteps: The underwater world.

The hostile environment underwater is another frontier that we couldn’t master yet. Developing protective equipment and gear for space will also enable us to discover much more of the ocean and the technologies will find a purpose on that front as well.

Housing

Traveling to space will be the first step. Setting up colonies on planets (starting with the moon and Mars) will be the logical next step. Again, the hostile environment will require very specific and unique designs, materials, and protection. Things that more and more humans on earth would also greatly benefit from.

Whether it’s the hurricanes in the Philippines, firestorms in California or Earth Quakes in Japan. Every year thousands of people lose their homes, and sometimes lives, to the power of nature. Creating protective shelters or even integrating higher grades of security into basic building construction based on materials and techniques that we will be using on outer planets might provide significant improvements to health and safety for us here at home. The potential is enormous.

Also, since construction in places where humans can’t work regularly in an open-air environment will require a much larger degree of automation and prefabrication, it is very likely that this kind of technology will find it’s way to our construction industry right here on earth. As one of the largest industries in the world, the potential is beyond being measurable.

Resources & Sustainability

Zero waste is a thing, and if you live in a place without resources, it needs to be a top priority. Given our current lifestyles which are almost completely based on waste, there is immense potential for improvement.

The last thing we want is to trash just another planet out there, don’t we? Thus, companies that focus on space travel and living on other planets will be able to influence our lifestyles and attitude towards this topic more than anything else.

Analytical tools

The whole buzz about exploring the universe is mostly about our hunger for science. We want to know how things work, what binds it all together, understand the complex nature of the force that surrounds us… sorry, that sounded maybe too much like Star Wars 🙂

But to analyze things that are unknown will require a whole new world of analytical tools, equipment and approach to analytical science. We can’t even begin to imagine yet what kind of knowledge and new techniques we could gather from this.

Endless opportunities

I could go on for the whole day about the implications that come with discovering this exciting new frontier. The key point is: There are endless opportunities and investing in such a company might be a high risk and it might sound like a pipe dream. But it is a calculated risk. I only purchased shares in the tiny amount of 250 Euros and will add more shares to double it up sometime next year. So it’s nothing I will lose sleep about. If Virgin Galactic could perform even half as good as Tesla did in the last 12 years, then this is a risk very well worth taking.

But even more importantly, this is the kind of investment that makes me really exciting to be an investor! Following the news on this company and watching it grow and develop, and knowing that to a very tiny part I am a part of it, is truly amazing.

With those last words, I am saying goodbye to 2019 and hello to 2020. I am sure it will be an exciting new year!

2019 wasn’t too bad

The year is coming to an end, and despite all the chaos around the globe, it wasn’t a bad year after all. No financial crisis, no armed conflicts on a global scale. Considering all the projections from 2018 it could have been much worse.

I feel like this year passed way too quickly and personally, it was a tough one. When I changed my place of work, I had to separate from my family for more than 7 months now. This situation will remain the same for about 3 more months. All this time I am living in a hotel and doing nothing else but focusing on work. Not always easy and mentally pretty draining, but the tough time is almost over and in January I will be moving out to something that I will be able to call “home” for a while.

The Financials

Financially, 2019 was good. I won’t hit several of my self-imposed targets, but they were maybe a little bit too ambitious. Still, my savings/investments and my dividend income grew significantly by almost 30% and everything is already set to grow at the same or even higher rate in 2020. With a few additional investments I might reach a growth of even 50% in my passive income next year, coming ever closer to my FIRE target.

I have also put a little more cash into two stock accounts here in Thailand. One is for more wife, the second one is for my daughter.

The account for my four-year-old daughter is only investing in 3 ETFs. One focused on dividends, one invests in SMEs, and one that follows the Thai SET index. The current volume is only about 1.500 Euros. I will grow it in 2020 to reach a volume of something around 5.000 Euros. In time, the dividends should serve the purpose of covering her pocket money. The SME-focused ETF which doesn’t pay dividends should continue growing to become her very own FIRE fund in due time. Should she want and/or need one.

For my wife, it’s a different story. I want her to have her very own passive income. I am therefore investing in individual stocks here in Thailand which pay dividends in different months. This will not only help us both to be financially independent, but it will also give us the advantage of having income in both currencies, Euros and in Thai Baht. Depending on the economy, we will then be able to take advantage of the best opportunities in both markets.

Brick & Mortar Business

This year was also an opportunity for me to diversify a little further and to get into some real estate business. I supported my parents financially to invest in a small bed & breakfast business. We are renovating a small house on our land in Poland and plan to set up 4-5 rooms for short-term stays. The income from this beautiful small rental business should secure their retirement, and increase the value of my property in Poland by a solid margin at the same time.

Last but not least, I also identified another potential opportunity in Japan. I will fly in March with a friend to the city of Fukuoka to identify a potential investment in a small bed & breakfast hotel in a hot spring town nearby the city. Given the economic situation in Japan and the diminishing population, many business owners and local governments turn to foreign investors to take over abandoned or decaying properties at bargain prices and I think this could a risky but very interesting opportunity.

The great thing about Japan: Foreigners can set up companies and buy land under their own name. So in comparison to China or Thailand, it’s actually a much more investor-friendly environment. Not to mention that Japan is such a beautiful place to be. I will report more details on this after the trip. Stay tuned.

2020 Forecast

In a few months, I will turn 40 years old. It pretty much feels like a performance peak, with my career, salary, and energy levels all aligned, and I will make sure to make the best of it. Some sacrifices along the way are painful sometimes. Especially seeing my daughter only once every 4-5 weeks for the last 7 months took a high toll, but this should be resolved within the first quarter of 2020 and I see a very promising year ahead as a whole.

“Nobody ever wrote down a plan to be broke, fat, lazy, or stupid. Those things are what happen when you don’t have a plan.” – Larry Winget

Many of my friends and family are always telling me that I tend to plan way too much. They are probably right. But for one, the quote above is pretty motivating to me. Secondly, I like to think that I plan for things that matter, and for things that make a difference for me and for my family’s future. I can’t imagine not having a plan in life.

And yes, step by step, year by year, I can see the change, the improvement. With every improvement, new opportunities are coming up. Let’s see what 2020 will bring!

In this spirit, I am wishing all my readers and followers a Merry Christmas and a Happy New Year! And if you don’t have your plan for 2020 set yet, now is the best time to getting to it.

Planning the next year

Today is the last day of the first week of December and it’s about time to get serious about the plan for 2020. I have spent some sleepless nights on reviewing my personal budget for the next year, adjusting savings targets, expenses and thinking about upcoming opportunities.

Health

For 2020, I target a savings rate of “only” around 30% of my regular work income. This doesn’t include my other income sources from investments and dividends. The target is set lower than in previous years because I want to allocate some resources in the next year into another important asset which doesn’t generate income per se: Health.

Full body check-ups for the whole family, dental treatments, scans and whatever should come up that is better fixed earlier than later. Human bodies are not meant to last. We require maintenance like every other machine out there and every once in awhile a check-up and some preventive maintenance are required.

Passive Income

I will spend the next few evenings to make the first projection for my dividend income for the next year. I think it should reach a growth rate of 30-40% and thus reach about a third of my final target which would make me fully financially independent. Not rich, but independent.

It’s amazing to observe how the speed of growth is accelerating now just after 4 years of consistent savings and investments. The first two years were pretty slow, but in 2020 I will have a 3-digit passive income every single month of the year, and given the speed of growth, in 2-3 years it should get to 4 digits.

Travel

But all this would be pointless without some fun along the way. Therefore, while I was never able to afford it when I was younger, I am now planning a trip with my family to Disneyland Tokyo sometime in March. I promised my wife a trip to Japan almost 6 years ago and I just can’t delay it any longer. The vacation has been already approved by my employer and I am going to purchase the tickets today or tomorrow. We will plan 4-5 days for Tokio, 4 days for Kyoto and 4-5 days for the area around Fukuoka/Kyushu.

A little later on in June we will visit Europe. I didn’t start planning for that trip yet, because while this will be vacations, I have to discuss with my wife about the destinations in detail. We are seriously considering moving to Europe in 2021 or 2022 and plan to visit countries that may offer the best opportunities for us to do so. My wife worries about food and schools, I worry about taxes. So obviously we are not perfectly aligned yet.

Hard to believe that only 24 days from now it will be the year 2020…