The fastest way to get your first million

I like to keep my blog neat and simple. I like to write articles with text only, I seldom use pictures or videos. But every now and then I might encounter an interesting infographic that is worth sharing.

When it comes to the topic of money, the best place to find interesting graphics is in my humble opinion a website called Visual Capitalist. This is also the place where I encountered the following graphic:

infographic-time-to-first-million-dollarsNow the data for this graphic comes from a website that compares casinos. To be clear: I don’t endorse, recommend or promote anything that might be concerned with gambling in any way.

Having clarified that part, the data in this graphic is highly interesting. And kind of amazing. The vast majority of people who made it to the financial top gained their very first million in less than a decade from the moment of (really) trying. How did they do that? Mostly by setting up a business.

Having your own business

So evidently, the most effective way to gain financial independence is not real estate, stocks or gambling – but your own business.

This is actually not surprising. As we know, it takes money to make more money. When you start from zero, the fastest and only way to get some cash-flow started is to work for it. You might start with a regular job, but we all know that when you work for a company, even though you might get good benefits and salaries, the majority of the profits that result from your and from your teams’ actual work goes to your employer. Obviously, this is not the case when you got your own business. As you take on all related business responsibilities, you also reap the full benefits and cash-in the entire generated profits from your operation.

Shouldn’t we all strive for our own business then?

IF having your own business is granting the fastest way to riches, then this would be the right question to ask. And for many having their own business, being their own boss, it is something worth striving for.

Not to me. I invest in stocks for a simple reason. I don’t want to have to work at all. I want to reach FIRE. For me, escaping the rat race is all about reducing the amount of responsibility on my shoulders and to free up my time. When you have a business, you always take on additional responsibility and you always have to keep exchanging your time for money. I want to have the freedom to decide whether I work or not. As a business owner, you don’t really have that choice without accepting sacrifices on your income.

Furthermore, having your own business may be the fastest way to riches, but it’s probably also the hardest one. Of course, there are different types of business and you need to consider whether you just want to earn enough to get through the day, or whether you want to build wealth. Your workload might be mild if you have a small, self-sufficient thing going on. But if you strive for that million on your account, then you will have to work really, and I mean really hard, on a scale that will surpass the amount of stress and responsibility of most regular employees out there.

So it comes down to what you really want. There are many ways and opportunities to escape the rat race. But there are only a few ways that will truly align with your own expectations. For most people who become successful with their own business, the target is not FIRE. They want to work, just on their own terms. If that is your target, great. If not, then you got to find another way.

DRIP it another way – DIY

Like in every profession, the world of investments is filled with abbreviations. One of the most popular, and dare I say most important ones, is called “DRIP”.

DRIP is an abbreviation for a Dividend Re-Investment Program which banks may offer their customers when they purchase certain stocks. The idea behind is very simple: When a company pays a dividend, the received cash is being immediately re-invested in more shares of the same company. This way one can automatically increase the amount of owned shares every time a dividend payment is due, without the need for any active involvement from the investor’s side.

It is a very effective and common system in the US. Unfortunately not so in Europe.

Europeans tend to be much more risk-averse and invest on average far less in stocks when compared with Americans. Over my investment lifetime, I had 6 different trading accounts with 6 different banks in Germany and none of them was offering DRIP.

DIY – Do it yourself

Well, if you have a problem and nobody is offering a solution, you got to take things in your own hands.

Every time when dividends are being paid out into my account, I am accumulating them until I reach an amount of approximately 1.000 Euros. Then I re-invest this 1.000 Euros. The 1.000 Euros is my guideline due to the rather high transaction costs charged by my bank. But, as long as I am working and my salary is sufficient to cover my on-going expenses, I am not withdrawing even one cent from my stock account. Ever.

Furthermore, I usually don’t re-invest this money into the same company. Instead, I will be on the lookout for another dividend paying company out there and purchase some shares of a new company.

My idea behind this is to diversify my investments to reduce the risk of any potential downturns in the market. For my FIRE account, I don’t buy companies that don’t pay dividends. So, my annual dividend income keeps increasing with every new investment I make. At the same time, as I spread out my investment over a vast range of different companies, my risk is being deleveraged.

That’s not the way of Mr. Buffett

Investment legend Warren Buffett is not a fan of this approach. He prefers a highly focused and compact portfolio. If I remember correctly, his investments as of today are in less than 20 companies. I have currently 16 different positions in my portfolio and expect to move up to 20 by the end of this year. Next year I hope to add another 10. And the year after another 10. My target is to have some 50 companies in my portfolio with ever-growing dividends.

I would love to have Mr. Buffett’s knowledge and experience, and to be able to make such successful investments as he did in the past. But let’s be realistic. I go to do this my way. I have far less money, experience, time and insights then him. For this reason, diversification is crucial for me.

DRIP or not – you got to keep re-investing

So whether your bank is offering a DRIP option or not. The lesson here is to keep re-investing your income from investments as long as you possibly can. Only this way you will be able to activate the power of compounding and see your dividends and investments grow.

Also, don’t get discouraged in the beginning. Dividend growth and re-investments are like a snowball that is slowly rolling down a mountain. It might take a while to get its momentum and it might even get stuck sometime. But at some point, it becomes a truly unstoppable avalanche.

The current market downturn will offer plenty of great investment opportunities. Watch out for solid, dividend-growing and dividend-paying companies and take advantage of the fear out there to grab them at a discount. Chances are that it will turn out to be a smart move in the long-run.

Getting some perspective

I have been on vacations for the last four weeks. While the first week was still pretty stressful due to a few family and work matters, the second week was already very relaxing. I spent some time at our inherited house in the north-east of Thailand. A peaceful and quiet place.

Extremely low living costs, usually filling a table full of food for less than 10 Euros at today’s exchange rate (1 Euro = 37 THB). A small Thai herbal sauna just in front of my house. A visit there costs only 50 THB which is not even 2 Euros. This includes the sauna visit and free of charge herbal tea – all day long. There is a nice public park for about 5 min. by car from my house, where I can go exercise every day, with a nice lake to run around, pull-up bars, a basketball field, soccer field and some machines that can be used. There is also a nice playground which is great for kids. After exercise, I can take a 2 min. ride to the local market where I can get a freshly pressed carrot-apple-lime juice for 20 THB. Roughly 0,60 Euro. A portion of steamed chicken breast with some rice and a chicken-broth-soup costs 40 THB. A little more than 1 Euro.

Why do I list all this? Very simple: I could have a very simple and actually good life in this place for probably less than 15 Euros a day – for my whole family. That’s 450 Euros a month. We inherited the house so there is no rent to pay, but even if I would rent a place it would cost not more than 200 Euros. For a 2-3 bedroom house or apartment, with a bathroom, garage, garden and garbage pick-up.

Keeping living costs low

The secret to success for most people is not about how much they earn, but about how much they spend. Having a high paycheck won’t help you if you are not able to manage your expenses. Living frugally is an essential part not only to become financially independent but also learn to enjoy a simpler life.

Basic living expenses play a key role in the entire structure. As we know, many people around the world use the majority of their earnings to spend on basic living costs. Rent, water, electric, food, transportation, education, and medical costs tend to eat up very large chunks of distributed salaries. Therefore the logical conclusion for most should be, that in order to be able to save more, one should try to reduce those costs as much as possible. Living above your means is a sure way to end up broke. Living below your means, however, will unlock the potential to save and to invest. Thus, building wealth.

There are plenty of blogs that teach people how to live frugally and I follow a few of them. I can always find some idea and some tips on how I can squeeze out more opportunities to save, without having any significant impact on my lifestyle. So while I don’t intend to make my blog about this, here my top 5 tips that I think can make a huge difference:

  1. Move to a low-cost area – This is probably the most important one. Living in an area where costs of living are low can have a tremendous impact on your ability to save up money. This does not only refer to the rent for your house, but also to such basic costs like groceries, coffee-shops, etc. If your profession offers the flexibility to move around, you certainly should consider moving to a place where you just get more value for your money.
  2. Ditch things that you don’t need – or declutter your life. Memberships, online subscriptions, insurance policies… you really got to review it all and consider which service brings real value to your life and what you consider necessary. For most cases, less can be more.
  3. Embrace minimalism – or declutter your life even more. I am sure I quoted this at some point on my blog already, but many people live their lives by buying things they don’t need, with money they don’t have, just to impress people who they don’t even know. It’s not necessary. You don’t need to have an expensive car. You don’t need to follow every new trend and to always be up to date – especially if you need a credit card to make it possible. Having less will free up your mind, your time and let you focus on the things that really matter. Like your family, or going for a run (instead of the gym). And when was actually the last time that you just laid down on your back in a field or on a lawn and watched the clouds passing by in the sky?
  4. Learn about taxes and benefits – A few things in life are certain. One is, that we all have to die. The second is, that we all have to pay taxes. However, while we still can’t control the first point, paying taxes is not only a burden but it also opens up some benefits. While some, such as a schooling system for your kids or basic medical care, are more obvious, other benefits are hidden and not in plain sight. So no matter where you live and what you do, it makes sense to spend a few days a year to learn about things that you are entitled to, and how to benefit from them. Ask around your friends, google it or maybe invest a few Euros to seek the support of a professional. It may be worth it.
  5. Re-evaluate your priorities – We all have our routines. Things we do, because we always did it. Things we do, because that’s how we grew up. Things we like to do because that’s what we identify ourselves with. Chances are, that those things do cost you money, and chances are even higher, that there are tons of things you might not know about yourself. Try to do new things. Explore your own abilities, interests and challenge yourself with things you never thought about or considered in the past. It’s not just about saving money, but also about developing yourself, expanding your horizons and finding new opportunities along the way.

Early retirement is possible with some sacrifices along the way

I am planning for early retirement. However, as I stated a few times, this won’t work without a few sacrifices. FIRE is not for everyone, because it requires a lot of sacrifices that many are not willing to take. However, living frugally is not one of them.

Living frugally, embracing minimalism and learning to be happy with less, will most probably contribute to a better and healthier life. It will reduce stress, pressure, costs and help you to turn into one of those people who are endless optimists. Because of the fewer things you own, the fewer things you have to worry about. And in today’s world, this is a huge burden taken off your chest. You should give it a try.

Planning for the last job – ever

Following up on my new years’ plans, I am now finalizing negotiations with my next employer. As my current work contract will expire by the end of April, I focused the last 2 months on trying to secure a new contract. Today, I succeeded.

While I couldn’t hit my self-imposed targets completely, the new job will bring some significant improvements and benefits to my career and to my private life. I will be in charge of a new hotel opening as a General Manager, with the expectation to grow into an Area General Manager role and in charge of a few more hotels within the contract duration of 2 years. By 2021, and if everything goes well, I might very well be in charge of up to 5 hotels across Thailand, and by 2023 there might be even a few more doors opening.

At the same time, I have also reached out to some of my colleagues from The Motley Fool in Singapore and Hong Kong. While I sure am getting busier, following up on my work with The Motley Fool Germany to analyze markets and stocks from the German, Swiss and Austrian area, I might soon start to also write about the stock market in Thailand. Yes, I am a workaholic.

All these efforts have one main goal in common: FIRE. Financial Independence Retire Early. This is the real reason why I am putting so much on my plate.

What makes this new job so exciting is that I am actually planning this to be my last job. My new contract will be for 2 years. It might get extended later on, and I actually have some further ideas and possible plans to continue of even up to 6 years with possible promotions along the way.

But it will be (hopefully) the last company and job that I will work for full-time. Whether it will be only 2 years as per the initial contract or even grow into 4 years or more. This will be my last full-time job and the last company I applied for a job with.

Working on full-blast for even just 2 more years and keeping up my high saving rate of over 40 %, will enable me to continue building up my passive income from stocks – to a level that my passive income will be able to cover all my regular daily expenses while still keeping on growing. I have calculated it 10 times through and the result is the same. Unless anything very unexpected happens, this next 2 years will be indeed enough to reach my target.

Light at the end of the tunnel

What this really means is that I am not just planning my next career move. I am planning for FIRE to kick in and to reach financial independence. I will be 41 years old by that time. What is even more staggering to me is that I only started to really put that much effort into the whole thing when I started my hotel career at the age of 29. This means that I will have reached my goal after only 12 years of truly hard work. I wish someone would have taught me some lessons about FIRE at school, then I might have reached FIRE probably around 10 years earlier on.

All the struggles, all the pushing myself to learn more, to work over-time and to trying to impress my supervisors, business partners, colleagues, all the hard work… will finally pay off…

Obviously, being a workaholic I don’t have any intention of truly calling it a day by then. My plan is then to turn my side-gig with The Motley Fool into a little more intensive exercise. I also think about going back to Germany for a short time, to certify myself as a financial advisor and to open up a small career and financial coaching business here in Thailand.

A million ideas, let’s see which one of them will become real in the end. The main point for me about FIRE is not to stop working in general, but about to be able doing things on my own terms.

There is a quote that money is power. It is. For me, it’s the power to regain control over your life, to reduce your dependency on others and to experience a form of freedom that most people in the world struggle their whole life for to find. I am now only 2 years away from it. 24 months. 104 weeks. I am really excited about it.

The dividend season is coming!

As the calendar has continued to roll into March, we are quickly approaching the dividend season in Germany. While most companies in the US pay out a dividend every 3 months, German companies do so only once a year. One could argue about which system is better or worse, but that’s a topic for another discussion.

In Germany…

The majority of companies in the largest German Stock Exchange Index (DAX) is paying out dividends from April to June. Right on time before summer vacation, to ensure that we get the necessary pocket money to go on holidays. Well, or if you are smarter, to re-invest it.

Traditionally over the last years, right before the announcements for upcoming dividends will happen, share prices start to rise as analysts evaluate and predict the expected payouts. And despite challenges across the globe, 2019 does look like a great year again. To understand the significance of this season, you need to take a look at some numbers. The expectation for 2019 alone for the DAX companies is a total payout of 35 Billion Euros!

That’s the number. Can you even imagine to have something like this on your account? Well, most people can’t and most people will never come even close to it, so this doesn’t really need to be your target. But receiving a piece of that pie is definitely worth the effort.

This is even truer if comparing dividend yields with traditional saving accounts. While it is currently quite easy to find companies which offer a yield on your investment of 3% or more, most saving accounts will be still below the 1% margin. It means that even with a modest 3% yield, you can receive 3 times the money that you would get if it’s parked on a traditional savings account. Just think about that. This the reason why investing simply makes sense.

In Thailand…

Interesting enough, Thailand has 2 major dividend seasons as most Thai companies pay dividends twice a year. The first season is similar to the German one, between April to June. The second one is around September and October.

I didn’t write much about the Thai stock market yet as I am still gathering experience, but I am setting up a stock account for my wife. As you might have guessed, I prefer stocks over life-insurance. Interestingly, Thai companies offer much higher dividend yields across the board and while some might think that investing here is risky, the truth is that the risk is pretty much controlled.

Due to the close relationship between politics and business, major companies are pretty well protected and with the country growing and moving forward, their profits are almost on autopilot. I will write more about this at a later point, but for now, I am getting ready for the dividend season here as well.

Re-investing is the key to long-term success

Receiving dividends at much higher yields compared with savings accounts is a beautiful thing. Even more so is the fact, that many dividend-paying companies tend to increase those dividends year over year. Re-invest those payouts, and you will create the 8th world-wonder: The magic of compound interest. Or compound-dividend. This is the one and only true key for long-term success, which any average person can achieve with very little effort.

Regular, growing dividends will enable you to escape the rate race much sooner. Or, if you prefer to keep working, offer you a nice supplement to your monthly paycheck or retirement payout. While many financial advisors will discuss with you about the 4% rule and about taking out money from your savings/retirement account when you get old, dividends offer you a much better option: Not taking out any money at all. If you are invested long enough, you can receive dividend-yields of 5-6% easily without selling even 1 stock, thus being able to enjoy a great lifestyle until your last breath.

This is no hocus-pocus. This is the power of investing.

The puzzle is not too complex

Reaching financial independence is best looked at as a game, a puzzle. There are all these little pieces everywhere, and your job is to get them into the right place. Only then the picture will be completed, and you can rest assured that your odds for a safe and free life have reached a comfortable point without worries.

This puzzle may look different for everyone, but if summarized into a few short key points, it would probably look something like this:

  • Health
  • Job & career
  • Expenses
  • Family & friends
  • Emergencies
  • Savings
  • Investments
  • Home
  • Other

Each of these points can have several sub-points and sub-topics which require consideration, but overall I would say that this is probably what most of our lives are about. The order of the points is not chosen by accident. This is, in my opinion, where a higher amount of focus should be distributed, when you start planning your own path to FIRE.

Health always comes first. No matter what you want to do, or what you like to do, or what you plan to continue doing – if your health drops so will all your plans.

A successful career or at least a stable job comes right after that because as we know, you need money to generate more money. Good or bad, our world is designed around money and without it, nothing gets done. So, in the beginning, you simply need to do your part and join the rat race. Without inheritance, a serious portion of luck in a lottery or casino, or any other completely uncommon circumstances, there is simply no other way. It is worth noting though, that pushing your career straight up quickly is a powerful method to escape the rate race significantly earlier. Simple logic: The more money you will have to save and invest, the sooner you can call it quits.

Controlling your expenses is on par with a career as the most powerful tool to reach FIRE. It doesn’t matter how high your salary gets, if you waste all that money on things that don’t matter, then you will have nothing to invest. In fact, it is probably one of the most difficult things to learn for the majority of people. You read all the articles about credit card debt? Education loans? Mortgage payments? How much money people spend on eating out, transportation, travel, parties, etc.? That’s right. You need to have control over your spendings, otherwise, all your efforts will be for nothing. Personally, I recommend to embrace and learn about a minimalistic quality lifestyle. More on this another time.

Balance is important, and things are not fun if we have no one to share them with. The goal for any FIRE aspirant is to have more freedom – and more time. But this freedom and this time are best spent by sharing with someone. Family and friends are an important pillar stone to keep your sanity, staying down to earth and to start appreciating all the benefits that life has to offer. It’s easy to neglect those ties when you focus on your career and try to keep your spendings at bay, but make sure to never let them tear apart.

Being prepared for emergencies is a very basic risk-control measure. All your hard earned money and all your savings can be eradicated in a glimpse when a sudden accident or incident will require you to pull out cash from your accounts. Basic insurance and a reasonable emergency fund will ensure that you can sleep well at night.

Savings & investments are a diversified topic. As my readers know, I favor the stock market. However, there are tons of other options for how money can be saved and invested. No matter how and where you start, just make sure you do it regularly. Make sure you get regular interest or dividends paid out. And make sure to re-invest those, to let the 8th world wonder of compound interest do its magic.

Home is on my last spot, for a simple reason. Home is a flexible concept for me. We all have our dreams, plans, and goals, and choosing a home can play a crucial role in your life. Repeatedly. What do I mean by that? Well, in the beginning, it might make a lot of sense to chose your home for a place where you can maximize your savings. Low tax, plenty of affordable shopping options and neighbors who don’t care about what type of car you drive really have a strong influence on your daily expenses, your lifestyle, and ultimately on how quickly you will be able to grow your nest-egg. Later, you might think more about a comfortable lifestyle, move to a tropical paradise or get back closer with your family. For a FIRE aspirant, buying a home is seldom a good investment and rather a loose and flexible concept.

Putting these pieces together and understanding what you want, how you want it and where to put your focus is the first step to understand who you are, what you want and how a realistic plan to get there might look like. Why not start thinking about it today?

Why everybody should invest

I strongly believe that the majority of people who don’t invest their money, most probably also don’t understand our economic and monetary system. There is otherwise no other valid explanation or reason, why any sane person earning enough to build up savings would not routinely and diligently contribute at least a small part of their savings into some kind of investments.

Investing itself is no rocket science and requires almost no effort. It actually only requires commitment and patience. There are many different ways of how investments can be pursued, but the easiest and most accessible one is certainly the stock market via ETF-index savings/investment plans. Therefore also the advice from one of the richest person on the planet, Warren Buffett, that the best investment most people can make, whether they’re wealthy or just have a few hundred dollars to invest, is a low-cost index fund.

We can, of course, have a debate about this and we could find some cases and examples that could undermine this statement – in some cases. But I actually like to learn from smart people who simply know what they are doing, who learned the lessons and are more than happy to share them with the world. It would be just not smart to ignore such learning opportunities.

Why it got to work out

Are there risks involved? They certainly are.
Is it a totally safe investment? It certainly isn’t.

So why should you put your hard earned money there? Well, because at the end of the day it just got to work out. Here is the idea behind it.

Good or bad, our economic system is designed for growth. As long as we keep developing, building, expanding, increasing consumption, researching etc. – our economies will grow. As long as the growth is intact, money is being created and wealth is increasing. However, as everyone noted by now, only a small percentage of people worldwide actually participate in the growing wealth. You might have guessed it: Largely, the investors.

There are people who think that we are approaching a limit for growth. I won’t debate about it but let me just say: Those people couldn’t be more wrong.

The world population is still growing, technology is increasing faster than ever and I am pretty condifent to see humanity going beyond the limits of earth within my lifetime. You remember how your parents were always telling you that there are no limits to what you can achieve? They were probably wrong, but there are certainly no limits to what humanity can achieve. This is what I believe.  And this is also, why growth and wealth creation will continue.

What can go wrong

Now, despite being very optimistic, there might be some bumps along the way. If economies stop growing and a country or the entire world falls into a recession, wealth is being reduced. This is not a theory, but a regular occurrence. The most popular country caught up in a recession is probably Japan. Despite it’s amazing technology development, large population and being home to some of the largest and strongest companies in the world, wealth creation has stagnated or even declined in Japan.

This is the reason why every time you watch news, people are really getting serious about growth. Even small percentages or differences can cause heart attacks, since the outcoming results can be devastating. But exactly, devastating for who?

Now, here it get’s tricky, because while the wealth of investors can be significantly increased during growth periods and reduced during a downturn, investors are probably not the ones who will suffer the most. The one who suffers the most will be the average Joe. Why is that?

Well, the simple point is that investors can control a few things and actively reduce their risks and protect their wealth through active risk management. This may include many different options, from increasing efficiencies at their business, working on better economies of scale, merger & acquisitions… but it may also include simple, old-fashioned cost cuts. Closing down factories, reducing work-force and everything else that might be deemed necessary to reduce their losses or to protect their profits.

This may sound cold and terrible, but it is a purely logical process. Something everyone of us would do, even on a much smaller and simpler scale, like for example when managing our household budget. You might not be able to “fire” members of your family when times get tough, but you might consider sending everyone who reached working age to some kind of work. You might scale down on your house-helpers or gardeners if you had some before. You might cut your Netflix account, put tighter limits on your credit cards, swap your groceries purchasing routine from monthly to weekly or even daily, get rid of you 2nd car, move to a smaller house or condo, etc. Well, in business all the same things are being done, simply on a larger scale.

Why it’s the average Joe without investments who suffers the most

This is the main reason, why being invested is the best thing you can do, in good, or in bad times. Because if your company needs to scale down and you lose your job, then there is probably not much that you could do about it. The same goes for, if your work benefits are being reduced, or your pensions shrink or anything else that the business needs to do in an attempt to reduce their own risk. The average Joe without investments got no say and no alternative.

When you are invested, some part of you is on the other side of the game. Because the money you invested makes you, to a very small part and depending on how much money you put in, a partner and co-owner of the business. It means that all these things that the business will do to protect either its survival or its profits, or simply to reduce its risk exposure, all those things are actually being done for you. To protect your investment.

And not only this. When focusing on dividend stocks or index funds that payout dividends, as long as the business makes profit, it will also keep paying you. While others get their pay-checks cut, you will most likely still keep getting dividend payments.

A dividend cut may occur, for various reasons, but if it happens, then in most cases it will truly be the absolutely last resort for the company. And even if the business should require to propose a dividend-cut, well, as an individual owner of the company shares (not so with an index fund), you will have a vote on this. How many employees get to vote whether they can keep their jobs when a difficult situation comes up?

Investing is the only smart thing to do

On the other hand, as a simple employee without investments, you are not even participating in the game. When you lose your job and the economy takes a dive, you will need to tap your savings, to borrow money or to go for social security. Neither options is pretty. For those who were parking money regularly on a savings account things can get even worse, because just within a few months they might deplete and completely destroy all their years of savings in the process.

As I mentioned, there are no guarantees and even the best investors lose money sometimes. BUT in the long run, as an investor, you have a realistic chance of accumulating tremendous wealth, build up passive income and to actively participate in the wealth creation in the process through dividend growth and compound interest.

It is truly the only, reasonable and proven system to accumulate wealth, which doesn’t require any effort, skillset, or qualifications. All you need to do is to simply invest regularly, disciplined and with patience. Time, growth, and dividends will do the rest. This is why to escape the rate race, the stock market is my way to go.

Take care of your family

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.

2019 will be THE year of opportunities

With all the drama all around the world, I firmly believe that 2019 will be still a great year with plenty of opportunities ahead and some really interesting developments. For FIRE aspirants such as myself, this could be a crucial year to move a big step forward towards the aim of financial independence. But before we get to that, let me point out a few interesting developments:

  1. Plenty of undervalued stocks – yes, 2018 was not great for investors, but many high-quality stocks suffered dramatic losses that were not really justified or simply exaggerated. In Europe, we have the car industry with such amazing brands like Daimler and BMW which trade on lowest valuations and have the potential for great turn-around stories. Look at the chemistry sector, with BASF being down to levels which we didn’t see for 5 years. Of course, you can be more careful and go for a diversified DAX ETF product to invest in all of these companies, but in my humble opinion, now is the time for cherry picking. Many of the most recognized brands are now at seriously low valuations and up for a grab.
  2. Dividend season is coming soon – while US investors enjoy quarterly or even monthly dividend payments, most European companies pay out dividends only once or twice a year. For European investors, the dividend season is usually between April – July which starts only 3 months from now, and chances are that 2019 will be another record year in dividend payouts. Also, with the currently low valuations, dividend yields look great!
  3. A recovery might come sooner and quicker than we expect – Because, despite all the uncertainties and drama, companies still make money. There is currently no serious threat of a financial crisis, political risks are mostly priced in the market and in general, I would say that most investors are by now pretty used to calculate risks and price them into their investments. This would indicate that as soon as things start looking more stable, everybody will jump back on the train and market valuations will move up swiftly. You saw a glimpse of that just yesterday when there was a rumor about a potential new trade deal between China and the US.

So knowing all these points, it might be not a bad time to put some cash back into stocks. Personally, I have put most of my cash reserves in stocks during December, when things were dropping down. This way I was able to lower my average costs per share for some of my stocks, which were hit the strongest by the downturn, and I hope this will pay off over the next few months ahead.

If you did the same, kudos! I believe it was. a great move. If not, watch out for undervalued stocks in the market. High dividend yields, low price/earnings ratios with solid brand names, large cash-flows and proven business models are on sales now. For the US market, take a look at AT&T, Oracle, Coca Cola, Apple.

Every stock downturn is a time of chances and opportunities. While inexperienced investors are biting nails, FIRE aspirants are scrambling all the cash they can find to put it into the market. Because, as we know, every downturn is an opportunity. Every crash is followed by a recovery. And every high yield that we can secure now, will ultimately help us to reach our goal of early retirement faster.

Disclosure: I am long invested in Daimler, AT&T, and Apple. 

2019 – Drop the resolutions!

Yes, you read right. The new year started but we don’t do the resolution stuff. We start the year with serious targets.

Today is the 6th of January, so the 1st week is almost gone. This means that we have roughly another 51 weeks to meet our own, ambitious but still realistic expectations on 2019. What can be done in 51 weeks? Here are my targets:

  1. Improve on time management. As you all know, and as the sub-headline of this blog indicates it: It’s all not about money, it’s about time. Time is our most precious resource and it needs to be managed well. A day has 24 hours. After deducting those 6-7 hours that are necessary to re-charge our batteries, plenty of things can be achieved each and every single day, if we allocate the remaining time efficiently. I would rate myself rather poor on this skill so far, as I still spend way too much time with my phone, while I could allocate more time to this blog, to my side hustle, to stock analysis, and to my workout routine. I will start slowly by:
    • trying to leave work on time,
    • delete useless apps from my phone and
    • to schedule my workout routine a little earlier throughout the day (so far I was always exercising after 10 pm)
  2. Increase side hustle earning by 50%. Right now I am writing about 1 article a week on average. I will try to increase this to 6 articles a month to curb my side-hustle income and to have more cash available for investments.
  3. Increase my dividend income by at least 10%. That’s right. While this should be not a problem, I put it on my target list. Most of my stocks will increase the dividend throughout this year anywhere between 2% up to 25%. However, I can also increase my dividend output by buying more stocks of companies which I already owe and which had been dragged down throughout 2018. This will cost-average down the stock-price in my portfolio and thus increase my average yield on cost per stock.
  4. Prepare for a larger market crash by saving up enough cash to be equivalent of 50% of my current stock portfolio volume. That’s the biggest and most difficult one, because this would require me to really try to achieve my savings target of 40% of my total annual income. Not impossible, but a tough one.
  5. Find a new job and re-negotiate my base salary by at least +20%. As mentioned in the last post, it should be possible due to my current situation, but I will aim even significantly higher. With perks and benefits, the total value increase should be at around 35%.
  6. Take a break for 1 month in between jobs. Yes, I put this in my target list also. I need time to recover and re-charge after my current assignment. I have now worked almost 2 years with a 6-day workweek, spending on average roughly 65 hours a week in my hotel. This does not include my side-hustle activities, my family time and my exercise routines (which takes 1,5 hours per day). So yes, to ensure I get no heart-attack before time, taking a break for a month will be commendable.
  7. Visit Japan and/or Korea this year. Indeed, it is about time. I haven’t gone to Korea and Japan since 2012 which is a real shame. I know my parents want to see my daughter and want us to go to Europe, but Japan and Korea is the reason why I moved to Asia in the first place and I seriously need to visit this beautiful places once again. On top, I have promised my wife this trip for a very long time.
  8. Exercise routine annual target:
    • 36,500 push-ups (100 per day),
    • 18,250 burpees (50 per day or 150 every 3 days),
    • 18,250 squats (50 per day or 150 every 3 days),
    • 3,650 pull-ups (10 per day),
    • Fresh-up of all my martial arts / kata routines
  9. Actively teaching German and English to my 3 year old daughter for 30 min a day
  10. Actively involve my daughter in my exercise routine to practice with me. She already started to sit on my head when I do squats or push-ups and loves to hang on to me when I try to do pull-ups, but this can be fostered more

So yeah, many things to do and 51 weeks is actually a short time. The older we get, the more we realise how precious time is. Let’s make the most of it.

And no, you really don’t need 8 hours sleep. The day is just too short to spend 1/3 of it with doing nothing.

This year, I also intend to write more about individual stocks and my investments. So just to give a brief heads-up, here a list of stocks which will be discussed and possibly purchased sometime in 2019:

Monthly dividend paying stocks:

  • Gladstone Investment
  • Main Street Capital
  • Realty Income
  • Apple Hospitality

Regular Stocks:

  • Ares Capital
  • Cisco Systems
  • Starbucks
  • Microsoft
  • McDonalds
  • Coca Cola
  • Merck
  • Pfizer
  • Iron Mountain
  • Tesla
  • Bayer
  • BASF
  • Aumann
  • DÜRR
  • GlaxoSmithKline
  • Royal Dutch Shell (B)
  • Baozun
  • Alibaba
  • QQQ


  • iShares MDAX UCITS ETF

Disclosure: Some of those stocks I already owe, some I had in my portfolio in the past but sold them with a profit and plan to buy again when prices drop.

So get ready for a furious, active and hopefully rewarding 2019!