I have been dabbling in stocks for the last 10 odd years and I have to admit I suck – period. I realised that I have zero interest in crunching numbers or reading analyst reports.  I look at bloggers and analysts who spent hours scrutinising financial reports, looking at charts, doing back testing, attending AGMs etc and I realised that that is not for me. If it is not for the fact that I have to have some form of investment for retirement, I would have washed my hands off investing now.

In the past when I see courses or seminars on investing, I will try to sign up but after a while I begin to find it boring and I am still nowhere closer to my ‘end game’. I will like to remind myself that I am a mediocre investor. If the professionals spent hours each day to in just trying to achieve 10% annualised returns, how can I better them without spending the same amount of time and effort?

I find working to be a more sustainable and less stressful way to achieve financial independence. Rather than having investing classes, I hope to see more courses to help people manage and enjoy their job.

Instead of calculating how I fare in my stocks and them shaming or praising myself on the performance, I decided to set a goal and how far am I from achieving it.

My target is to have the Lazy Man Portfolio generate $20,000 per annum. Based on 5% yield, I should be able to reach my target at age 54.  Instead of focusing on portfolio growth, I will look at how I can achieve the yield in absolute amount.

Year Age Portfolio (Start of the Year) Yield (%) Yield ($) Cash Injection Portfolio (End of the Year)
1 39 $86,000.00 5.00% $4,300.00 $11,000.00 $101,300.00
2 40 $101,300.00 5.00% $5,065.00 $11,000.00 $117,365.00
3 41 $117,365.00 5.00% $5,868.25 $11,000.00 $134,233.25
4 42 $134,233.25 5.00% $6,711.66 $11,000.00 $151,944.91
5 43 $151,944.91 5.00% $7,597.25 $11,000.00 $170,542.16
6 44 $170,542.16 5.00% $8,527.11 $11,000.00 $190,069.27
7 45 $190,069.27 5.00% $9,503.46 $11,000.00 $210,572.73
8 46 $210,572.73 5.00% $10,528.64 $11,000.00 $232,101.37
9 47 $232,101.37 5.00% $11,605.07 $11,000.00 $254,706.43
10 48 $254,706.43 5.00% $12,735.32 $11,000.00 $278,441.76
11 49 $278,441.76 5.00% $13,922.09 $11,000.00 $303,363.84
12 50 $303,363.84 5.00% $15,168.19 $11,000.00 $329,532.04
13 51 $329,532.04 5.00% $16,476.60 $11,000.00 $357,008.64
14 52 $357,008.64 5.00% $17,850.43 $11,000.00 $385,859.07
15 53 $385,859.07 5.00% $19,292.95 $11,000.00 $416,152.02
16 54 $416,152.02 5.00% $20,807.60 $11,000.00 $447,959.62
17 55 $447,959.62 5.00% $22,397.98 $11,000.00 $481,357.61

 

There are still a few hard questions that I have to ask myself:

1) Is 5% yield a realistic target considering I hardly spend any time reading up on stocks?

2) Is my current portfolio generating at least 5% yield, else how should I re-balance it?

3) A huge portion of my portfolio is in cash but I do not want to rush to invest it.

4) Is $11,000 cash injection a year sustainable considering that I will have more liabilities in the future.

5) I have not yet taken my spouse into consideration. $20,000 is barely enough for one let alone two.

6) Are plans like OCBC Blue Chips Investment Plan, POEMS Share Builder Plan etc a viable option?


Asahi Girl Photo Credit: Cocoa