↑ Emerging Markets Stock Index Fund is up by $4,203 or +1.8%
↑ Growth fund is up by $676 or +0.6%
↑ Additional investment savings $2,500
↑ Partial severance package investment $69,000
Total gains: $ 76,379
↓ Eurozone Stock Index Fund is down by $4,973 or -1.9 %
↓ Standard and Poor’s 500 Index Fund is down by $2,226 or -0.4%
↓ Global Small Cap is is down by $9,758 or -%4.2
↓ CG Aegon High Yield Bond is down by $654 or -1.9%
↓ Schroder High Yield Opportunities Bond is down by $561 or -1.7%
↓ VanEck Global Fallen Angels High Yield Bond is down by $483 or -1.8%
↓ Vaneck Ucits Etfs Us Fallen Angel High Yield Bond is down by $303 or -1.1%
↓ EUR to USD is down by 2.6% or for my portfolio $12,886
↓ GBP to USD is down by 1.5% or for my portfolio $1,761
Total losses: $33,604
Observations:
Raising ETFs fees. For the personal independence finances my main focus is on what not to do. Exchange Traded Funds (ETFs) started as a small-investor-friendly alternative, designed to avoid big expenses. I was lucky to invest in Vanguard ten years ago, with the fund’s ongoing expenses ranging between 0.25% and 0.38%. Ten years ago the minimum investment was $100K; today it is $1 million per fund (top-ups are still possible).
For the most recent ETFs I invested in, the fees are between 0.35% and 1% a year. Funds that mimic a large-company index can cost next to nothing: BlackRock’s iShares, Schwab, State Street and Vanguard all offer such ETFs with annual fees of 0.03% or less. Yet index-tracking ETFs that charge at least 0.20% to invest in large U.S. stocks held $417 billion as of the end of September, according to Morningstar. Thanks largely to inertia or inattention, investors are paying tens of millions of dollars a year in excess fees.
Silly ETFs. What I have noticed is that ETFs are getting incredibly silly, often focusing on narrow and somewhat risky assets. Some ETF sponsors launched funds that would go up or down based on which political party wins upcoming elections. More than 100 proposed ETFs are tied to the real-time success of National Hockey League teams over the course of a season. I think it’s O.K. to take risky bets (gamble), as long as the picture is clear: this is not sustainable investing, and it risks one’s financial independence.
As of late August, according to FactSet, 612 out of 772 U.S. leveraged ETFs are based on a single asset instead of an index. Because they’re undiversified, these funds are far riskier. Traders and speculators love them; investors shouldn’t touch them with a 10-foot pole and a hazmat suit. It’s hard to imagine anyone trying to hold these for life, but some people might.
Inflation proofing your life. Oil is around $100 a barrel, long-term Treasury yields are at their highest in years, inflation has exceeded the Federal Reserve’s 2% target for more than five years and the government is spending like a drunken sailor who just won Powerball.
I inflation proof my life. recently I went to a cafe and was asked to pay $5 dollars for a cup of coffee and pastry $7 USD. Bowl of ramen noodles cost $20. I went to a shop I bought freshly grounded 9 Oz Ethiopian coffee for $15. It will last me a month (during week I have free coffee at work). Mentally, I am in a place where I don't need to buy many things anymore. I am not in a rush and can make my own coffee and noodles.
I can still spend on some nice comfortable shoes and clothing for work. I also discovered that with some proper care the several business shoes last at least 5 years +. All I need is wash dry and apply shoe cream every 3-4 months. I dont need to update technology often. Good quality laptop lasts 7 years without an need for an upgrade, phone 3-4 years. I do my own compost at home and small orchard.
When to stop contributing towards financial independence. Coast Financial Independence aka Coast FI. The point where your current investment portfolio is large enough to grow on its own—through compound interest—to fully fund your traditional retirement by a target age, without you ever adding another dollar to it. Coast FI has inspired some early career adults to give priority to retirement saving.
To calculate it Coast FI = Retirement savings goal / (1 + r)ᵗ
where:
r = rate of return on investments
t = number of years until retirement OR (retirement age – current age)
So, let's say I want to achieve $3 million in 10 years. Inflation adjust growth rate is 3%. I need to have $2.2 million today. The purpose of this indicator is estimate when I don’t need to make further contributions to my retirement and just need to wait. In the same scenario if I am willing to wait for 15 years, I just need to have $1.9 million today. If you are ready to wait 40 years, you just need $1 million. The importance here is to have discipline to make untouchable and start early.
I don’t believe that social security benefits will be around for my retirement. I also expect that decent medical insurance will cost me at least $25K a year in today’s money.
Fun fact: October has frequently been an extraordinary month for stocks. In 1987, the stock market crashed on Oct. 19, falling more than 20% in a single day. Over the five days ended Oct. 10, 2008, as the global financial crisis intensified, U.S. stocks lost 18%, the worst week on record at that time. The Panic of 1907, which devastated the U.S. banking system, also erupted in October. Mark Twain said it better than I can: “OCTOBER: This is one of the peculiarly dangerous months to speculate in stocks in. The others are July, January, September, April, November, May, March, June, December, August, and February.”
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