It’s almost the end of 2023 and I am thinking about the year that has passed and what awaits for 2024. Financially, 2023 has been a good year thanks to a rebound in the stock and crypto markets.
My net worth (including superannuation) at the start of 2023 was $1.47 million and today it is $1.73 million, which is a net worth increase of $260k for the year 2023. Note that at the start of 2022 my net worth was $1.81 million, so in 2022 I lost $340k. This means that looking back two years, I am down $80k.
Regardless, I would be comfortable retiring right now. I am still single and have no children or any social obligations. One of the biggest problems with my assets is that it is quite volatile thanks to exposure to not just crypto but also volatile ETFs (e.g. tech ETFs). My focus going forward will be on dollar cost averaging into high dividend ETFs (including covered call ETFs) and when I retire I will use reverse dollar cost averaging to sell off all my crypto and volatile ETFs, pay off my margin loan, and then put any remaining money into high dividend ETFs (e.g. IHD, SYI, YMAX, and UMAX), and then I will live off dividends during retirement.
I am still working now and haven’t retired yet mainly because I do not feel like I am ready to pull the trigger. I have what is known in the FIRE community as “one more year” syndrome.
I have been thinking about my new year’s resolutions for 2024 and there are three that I have identified:
- Travel more.
- Don’t walk into bad neighbourhoods.
- Don’t be addicted to background music. Embrace the noise of life.
Travel more
The first one is self explanatory. Everyone has something that gives them joy and I think mine is travel. Now that I approach the middle of my life, I would love to see more of the world. You only have a limited amount of time on this planet, so you may as well do something you love. Of course, it will be hard for me to shake my frugal habits. I will try not to spend more than my dividend income and I will still fly economy. When I travel, I will not be trying to pack plenty of experiences into one. I believe in the concept of slow travel, which means spending more time in one place and doing less rather than trying to do everything in one trip. In fact, when I retire, my plan is to slowly travel to many different places around the world.
Everyone is different, but I am certainly someone who values experiences over things, so I will happily spend money on a holiday rather than a new car or even a house. When I think back over my life, I realise that the memories I can most vividly recall are either moments I had with my ex-girlfriends or moments when I travelled. Everything else blurs into one and is forgotten.
Don’t walk into bad neighbourhoods
Wherever you go, it makes sense not to go into bad neighbourhoods. A bad neighbourhood is a place you can recognise instinctively. When you travel, it’s not a good idea to walk alone in what seems like a bad neighbourhood. The place just doesn’t look right, there are bad people around, and you may get hurt. Using your gut to recognise bad places and staying away from them helps you stay safe.
The same concept applies on the internet. There are many websites or apps or certain clickbait news articles that, if you walk down that rabbit hole, you’re going to get hurt. While we instinctively stay away from bad neighbourhoods in real life, on the internet there is something alluring about walking into bad neighbourhoods. It is like driving by a train wreck and looking at this train wreck from the safety of your own car. Thanks to the anonymity of the internet, we feel compelled to walk into bad neighbourhoods. Such activities, including so-called doomscrolling, can take a toll on our mental health. We need to recognise what a bad neighbourhood looks like online and train ourselves to stay away.
Don’t be addicted to background music. Embrace the noise of life.
In my opinion, one of the reasons why we doom-scroll or go on social media is because we have an aversion to silence. We don’t want to think too much. We seek distraction. Peter Wessel Zapffe, a Norwegian philosopher, discussed distraction as one of the defence mechanisms that we use against existential suffering. A study at the University of Virginia found that people would rather stick their finger in an electric socket than sit quietly and think. However, in my opinion, there is something very rewarding about isolating yourself and being alone with your thoughts. When you’re disconnected from everything and let your mind wander without intervention from outside thoughts, you tend to come up with very insightful ideas about yourself and your future.
I even find that background music (such as ambient music) can be distracting as well, and I think I listen to background music because of an aversion to the natural noises of life. Urban and suburban living can be noisy, but generally speaking if you are alone in a room, all you hear is a muffled distant hum of traffic. I will try to get comfortable with the natural noises of my surroundings.
I Live Off Dividends 