Category: Retirement

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Late Starter to FI Series #29 – Hi Fi-ing Auntie

Welcome to the Late Starter to FI series!

I am a Late Starter – I discovered the FIRE (Financial Independence Retire Early) movement when I was 47. This was way later, I thought than others who seem to have it all together in their 20s and 30s.

Since I started to write about my own journey, I have discovered there are many more Late Starters like me, yay! It’s such a relief knowing I’m not alone. 

I want to share our stories, our unique perspectives and show that it is absolutely not too late for us.

So in this series, I particularly highlight those of us who start our FI journeys in our 40s, 50s and 60s. And explore questions such as ‘where do we start’, ‘can we still retire early(ish)’, ‘what are the specific challenges for us late starters’. We look at our past, not to castigate ourselves but so that you can learn from us.

Please join in the conversation in the comments below. I encourage you to share your story if you fit the profile of a late starter. You absolutely don’t have to be a blogger or podcaster to share your story. 

Please email me at info@latestarterfire.com or connect with me on Twitter or Facebook or Instagram.

If you’ve missed any of the previous stories, you can catch up here – Late Starter to FI series

And if you can’t wait to start on your own FIRE journey, check out my step by step ultimate starter guide, Late Starter to FIRE Action Plan.

Disclosure: Please note that I may benefit from purchases made through my affiliate links below, at no cost to you

Gardens by the bay, Singapore

Today’s late starter is Hi Fi-ing Auntie from Singapore, whom I first connected with on Facebook and later on Twitter.

Auntie is our first late starter from Singapore and second from South East Asia – this goes to show that FIRE is not limited to residents in the US (where it seems the majority of FIRE folks live!)

She shares her journey at Hi Fi-ing Auntie  and calls herself “Auntie” because in her own words …. “For those who are not familiar with “Singlish” (the brand of English spoken in Singapore), an “auntie” is a middle-aged unfashionable woman concerned with cheap bargains value-for-money purchases, gossips, and all sorts of useless facts that may be useful to… someone. In that sense, I’m not really an auntie, but I own the stereotype and proudly call myself one.”

You can connect with Auntie on Twitter too.

Take it away, Auntie!

A little about me

I live in Singapore and am in my late 40s. I am a Communications manager in the transport industry. I live in a government (HDB or Housing Development Board) flat that is fully paid-up with my partner who is an engineer.

You need to understand that I’m by nature a very risk-averse and lazy person. This explains to a large extent how my FIRE journey evolved.

Light bulb moment

My light bulb moment was reading “Millionaire Teacher” by Andrew Hallam and checking out his blog articles. This is the first time someone presented a plan for someone based in Singapore.

I was in my early 40s and recently made redundant when I came across these resources. After more than 15 years, leaving the company prompted a reassessment of my financial situation and retirement goals.

I realised that you can never depend on remaining employed until the official retirement age. Ageism and age discrimination is a huge problem in Singapore, particularly for women who tend to assume the bulk of parent-care. At the back of my mind, I knew I had to deal with this but the redundancy forced me to be more serious about my retirement plans.

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My financial situation at light bulb moment

I have been very thrifty ever since I started working after graduation (more than 20 years ago). After graduation, I paid down my study loan very quickly and proceeded to accumulate cash. I saved $100k before I was 30.

However, options for investing were thin at that time and it was between the local stock market (stock picking), unit trusts (high fees) and investment-linked insurance policies. Online brokers were just coming on but the process of getting an account, transferring funds and trading was so complicated that I did not bother, not to mention my concerns about the security of my funds.

So I continued to accumulate savings but in the meantime, started stock picking some blue chips on the Singapore stock market. However, being a lazy person by nature, I did not bother to monitor the shares much. So my portfolio continued to languish at the $100k mark for a very long time through stock splits, share distributions and other corporate actions that diluted the value of my shares.

When I was made redundant, I received a huge payout which I diverted to my mortgage, paying it off in full. Now I realise it’s a financial mistake but it is a decision that I do not regret.

First steps on the path to FI

My very first step on the path to FI was to cancel my investment-linked policies and put the redemption sum into a global stock index fund.

I sold a large portion of my Singaporean shares and put them into a local stock index fund.

And diverted almost 70% of my emergency funds into investments. That still leaves me with one year of savings.

How my relationship with money has changed

It is changing very slowly.

I tend to equate a money value with everything. For instance, if I wanted to start a hobby, I would think about whether or not I could eventually monetise it. It skews my values and I have missed out on so much because there is always a money element in my considerations.

Thanks to Ramit Sethi (author of I Will Teach You to be Rich), I realised it’s costing me enjoyment in life. This tendency is hard baked into my psyche and today I am constantly reminding myself to let go of this money mindset.

Other factors affecting my finances

My mother had been working up until around 3 years ago so she had savings of her own. However her mental health has been declining and I foresee that I will need to chip in in some way in the future. If there is a reason why I feel the pressure to continue earning an income, it is her.

I am divorced and do not have children. Not having children really frees up my financial resources and mental space to take care of my own retirement.

View of Singapore residential buildings also known as HDB

My current financial situation

Andrew Hallam introduced 2 portfolios – the Couch Potato Portfolio and the Permanent Portfolio. Both are suitable for lazy folks like me. I decided on the Couch Potato Portfolio as I did not relish the idea of holding gold.

In short, the Couch Potato Portfolio’s fund distribution is:

50% stocks, 50% bonds

So the way I customise my Couch Potato Portfolio to fit the Singapore context is as follows:

Stocks

Local: I invest about 10% of my annual fund allocation via a retirement vehicle into a Singapore stock index fund. There is a tax benefit in doing so – you can lower your tax bracket. The flipside is that you cannot withdraw from this account penalty-free until after the statutory retirement age (62 currently).

Currently, the Singapore stock index fund returns around 7% annually

Global: I invest 40% of my annual fund allocation into global/US index funds. The historic returns of the funds are around 11%

Bonds 

In Singapore, we have a compulsory retirement savings scheme called the CPF (Central Provident Fund). Every working person must contribute 20% of their salary into this fund, with the employer matching up to 17%. So I have a healthy balance in the CPF at the moment. However, I cannot withdraw from the fund until I am 55 years old. It pays 2.4% to 6% interest at the moment.

Many Singaporeans use their CPF to buy homes, which to me jeopardises their retirement. This strategy may work in a booming market where one can hope to sell their properties at a profit but who can guarantee that? In fact, I feel that using CPF for housing makes one tend to overextend. I used the CPF when I first bought my flat but quickly paid off the sum within 6 months.

Currently my portfolio stands at 40% stocks, 60% bonds / CPF.

I hold one year of emergency funds that can be stretched if I am really, really thrifty.

Currently I have zero debt other than a monthly balance on my credit card which I pay off in full.

 

Specific challenges or advantages of starting late

One of the challenges is the fear of losing it all by changing our financial pathways. For example, it was difficult for me to decide to drastically reduce my emergency funds and divert the money into stocks.

How far along the path to FI am I now?

I am at what some people call LEAN FIRE now. But it’s not my ideal state of retirement. So I hope to be able to continue adding to my retirement funds until I am 55.

 

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How Covid 19 has affected my strategy

Lower job security and possible loss of income are two concerns. The industry my company is in is directly affected by travel restrictions. It has been going through major retrenchments. I am mentally prepared that I may be affected by it.

I would consider adding more to my emergency fund to stretch it to 1.5 years perhaps. But the investment strategy would not change.

What's next?

Because I am an employee, my financial plan is dependent on me remaining employed. So this is one weakness in my plan. And because of the prevalence of ageism in our society, sometimes, retirement is not up to me!

If I somehow lose employment, I would still want to continue earning an income. So instead of a stable full time job, I might switch to contract work which usually comes with lower pay.

I am aiming for a very comfortable retirement at 55 – I feel impatient!

Back to Latestarterfire

Thank you, Auntie for sharing your story and strategy to achieve FIRE at 55. Congratulations on making the necessary changes to ensure you’ll arrive at your destination.

I think the fear of losing one’s hard earned savings if we were to change our financial paths later in life is very prevalent among late starters. And yet, if we carried on as usual, our hope for financial independence at retirement is also diminished.

Singaporeans have long been envied for their CPF – I didn’t realise that employers provide a match of up to 17% – what a fantastic start to retirement savings!

I am hoping that as more of the world is vaccinated, your industry will recover soon and redundancies will not continue. Keeping my fingers crossed for you.

I love that name – Couch Potato Portfolio – I too am risk averse and lazy so this would have appealed to me immensely had I come across it earlier 🙂 I’m off to read Millionaire Teacher now!

Do you have a Couch Potato Portfolio?

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What do I want to do Before I retire?

Silhouette of woman with hand on her face | What do I want to do before I retire
Photo by Matteo Vistocco on Unsplash

I’ve been thinking a lot about retirement lately. Surprise, surprise 🙂

You probably think that being a part of the FIRE (Financial Independence Retire Early) community automatically implies that retirement is a goal one strives for continuously and is something we think about often anyway.

But there is a more immediate reason. I always dream about retiring when I feel stressed at work. And this time is no exception.

The flu season is upon us and I can’t help but remember what this time was like last year. Without being dramatic about it, it brings up feelings of anxiety and stress.

We were inundated with bookings. Phones were ringing off the hook. We struggled to get enough supply. My colleagues were worried about getting Covid 19, either because they have chronic health conditions themselves or were worried about spreading it to elderly parents. It was left to me to keep the service going. And I did. There really wasn’t any choice.

It may or may not be easier this year. Certainly my colleagues don’t mind helping out this year (I am still obviously alive!). But this year, there is the added complication of Covid 19 vaccinations (a good complication, mind you).

It is advised that the flu and Covid 19 vaccinations be separated by at least 14 days. Mainly because we don’t know if there is any interaction between the two. And if there are any side effects experienced, we’d like to pin them on one or the other. So people need to be extra organised this year – having to organise 3 jabs instead of just the one.

Anyway, things got to a head (literally, inside my head) that I took some unplanned time off work, 13 days in total. Just so that I can have a break before the busy season ahead.

But of course, I don’t know how to relax completely. I made appointments to see my optometrist and GP. Finally got a blood test. Blah blah blah, mundane but important chores that didn’t get done in 2020.

Retirement? No, no no!!!

My eyes were so bad that I needed two appointments with the optometrist. At the second appointment, during a lull while he was setting up some equipment, I innocently asked if he would be retiring anytime soon. He’d been my optometrist for more than 20 years and I was wondering what to do if he were to retire.

Well! His reaction was comical. Why would I want to retire? Why did you ask me today, of all questions? I just received a letter from some corporation asking if I intend to sell my practice and retire soon. What would I do in retirement? I’d have to see my wife 24/7 – she’d have so many jobs for me to do around the house and garden. No, no, no, definitely do not want to retire. I would want to work a few days at the very least.

I replied, knowing he loves to travel – don’t you want to travel to somewhere that you can stay longer than two weeks or a month? Say, stay for 3 months and explore in a more leisurely manner?

His eyes lit up. Hang on, he says. He left the room and came back with his iPad. Here, let me show you some photos of when I was in the Serengeti a few years ago. I would absolutely love to stay for 3 months here.

And the photos were gorgeous … he was on a trip that followed the migration of wildbeests – every night, they stayed in 5 star accommodations and by day, they followed the animals.

Going to Africa on a safari to see these animals in their habitat was on my to-do list for retirement too. So this was handy – more info to file away to that part of the brain that deals with future retirement.

A herd of wildbeests crossing a river
Image by Les Bohlen from Pixabay

Retirement? Yes, yes, yes!!!

Immediately after this discussion, I was off to visit Frogdancer Jones in her Best House in Melbourne. We’d only met in person once, in 2019 at the Playing with Fire documentary in Camberwell.

And since I’d basically asked to tag along on her Antarctica trip, I thought it’d be a good idea to get to know one another in person.

We got along like a house on fire and didn’t sop talking for hours. Phew! I think we’ll be fine in a cabin on a boat to and from Antarctica 🙂

What really struck me was the stark contrast between my optometrist’s abject horror at the thought of retirement and FDJ’s obvious delight at being newly retired.

She was rested, napping whenever she wanted and has read 20+ books (it’s only March!), discovered new programs to watch on Netflix and Stan, renovated her en suite ….

She generously fed me delicious gnocchi made from home grown potatoes in a tomato and basil sauce – yes, all grown from the back garden.

And sent me home with 2 gigantic zucchini from the front garden, some lazy housewife beans, lime verbena leaves for a refreshing tea and a bar of hand made soap.

Reading her blog posts always inspire me. Face to face conversation with FDJ was even better! I went home, inspired by her effortless generosity and exuberance. I cannot wait to be retired myself!

2 giant zucchini
Frogdancer Jones' gigantic zucchini

And there was more ... on retirement ...

In the same week, FIRE Your Own Way asked on Twitter – What is the first thing you’d do when you retire?

My reply – NO MORE ALARM CLOCKS – and no routines … read for as long as I want, sleep/nap often …

So yes, it seems that I have been thinking a lot lately about retiring and what I’d do when I retire. Most of all, I am looking forward to having my own routines for me, not because I have to be in my best form for work.

And now ... the conundrum ...

As part of my GP visit, I mentioned about how stressed I feel thinking about the upcoming busy season at work. We discussed the benefits that I may gain from talking to a professional psychologist.

So off I went …

At my second appointment with the psychologist, I unloaded about how unproductive I feel at home, after work even though I had made progress from the first appointment. I had accomplished little chores each night and practised self care by reading (I love my new reading glasses!). She asked about my passion and I told her about the blog and wanting to retire at 55.

Her comment was … hmmm … what do you want to do BEFORE you retire?

I was flummoxed. Ummm … what do you mean, BEFORE I retire? In my head, I was thinking … working obviously, I have to work until I retire, duh!

She replied – based on how you are feeling now, despite having a full time job and a blog on the side, you still feel unproductive. How will you feel when you don’t have a full time job? Will you feel unproductive?

You obviously have a financial plan to take you to retirement. Instead of thinking about what you want to do when you retire, how about thinking about what you want to do before you retire? Let’s transition you towards this retirement.

No joke. This question has kept me awake. It is 2.59am and I cannot go back to sleep. 

My constant struggle with productivity

I think I have an issue with allowing myself to relax. I always feel guilty that I am not more productive. Without meaning to, I am always comparing myself to others’ prodigious productivity.

I tell myself – you don’t have any excuses not to be productive. You don’t have to cook and clean and take care of a family in addition to working full time. What’s your problem?

Four people I’ve spoken to about this in recent weeks have all said the same thing to me – You are so hard on yourself. But am I, really?

Do I just have high expectations of myself? I don’t know. Perhaps. What I know is that when I don’t fulfill those expectations, I feel defeated. Then I procrastinate and am paralysed and don’t do anything. Arghhh … why do I do this to myself?

I get the psychologist’s concern. If I always feel unproductive now, then how will I feel when I am well and truly retired? While I may spend the first few months being blissfully happy with no routines, staying up late reading and when I’ve travelled to my heart’s content, what then?

Are you READY to TAKE ACTION today?

🔥 practical tips & strategies

🔥 step by step guide

🔥 cut the overwhelm, second guessing & paralysis by analysis

I WANT THE ACTION PLAN

So what do I want to do before I retire?

Perhaps I should reframe the question as – what can I do now instead of waiting for retirement?

I want to work on my fitness and weight loss goals now. There is no point arriving at retirement with a body that can’t enjoy some vigorous activity, especially while travelling. Since I live a fairly sedentary lifestyle now, I will need to up my game by increasing time spent outdoors. Losing 10kg is one of my 2021 goals – I am pleased to report that I have made a start on this and lost 2kg so far.

I’m loving growing my own vegetables – I have so much to learn and would love to expand into growing dwarf fruit trees and maybe venture into beekeeping … I’d love to be self sufficient by the time I retire and have thriving food gardens.

Building and maintaining relationships – this suffered to a certain extent in 2020. There were of course, a lot less get togethers due to Covid lockdowns. But as a result, I am not as enthusiastic as I once was for organising meet ups with friends. But as more of us are vaccinated, hopefully my enthusiasm will be rekindled. Regardless, I have to work on this more.

Building and maintaining this blog. It breaks my heart when I read someone posting in Facebook groups about how late they think they are at starting saving and investing for retirement. I want to shout – no, start today, it is not too late. So I want to continue sharing my story and other late starters’ stories. Yes, I will have more time to work on it when I’m not also working full time but I can devote what I can to it now. Instead of feeling frustrated that sometimes I am just too tired to work on it. And that I am not being consistent. Blah blah blah.

I would also like to explore some volunteering before I retire instead of waiting till retirement. Right now, I contribute money to various charities and causes. But I’d like to contribute my time too, eventually.

Hopefully, doing all these before I retire will lead me to find some purpose and still feel productive when I do eventually retire in 6 years.

Final thoughts

I don’t want to arrive at retirement with only a financial plan in place. 

Right now, I long for retirement as a means to escape the stresses of full time work. I yearn for time to do my own thing and for slow travel and perhaps to tick things off my bucket list before the threat of dementia descends.

But really, I need to start exploring now and think about what I can currently be doing to live life to the fullest, instead of dreaming about what I’d do in retirement.

How about you? What do you want to do before you retire?

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