Hi, MMM Forum,
I am new to the forum and wanted to make a quick introduction, but mostly I would like to outline my current plans and invite some critical feedback to make sure I have dotted all the i's and crossed all the t's.
The whole FI/ER can be a little daunting, and especially now I opened a brokerage account and dumped most of my net worth into the markets :/
Without further ado, lets jump into the details.
Location: | Dubai, United Arab Emirates |
nationality: | British |
Age: | 26 |
Income: | $100k |
Tax: | 0% |
Marital Status: | Single |
Dependents: | None |
Assets |
Emergency Fund: | $20k |
Investment Acc: | $75k |
Motorbike: | $5k |
Total: | $100k |
Liabillities |
Rent: | $18k/Year |
Spending: | $21k/Year |
Total: | $39k/Year |
Savings Rate (YTD): | 57% |
Phew!
First of all, I realise my Emergency fund is a little too big, this is due to the fact that I have 4 bank accounts and the $20k is across a few of them for various reasons.
I have 3 offshore bank accounts in the Isle of Man and Jersey, in USD, EUR, and GBP.
Currently I have around $5k in the USD acc and a combined $500 in EUR/GBP.
The USD acc is a real Emergency Fund in case that my local bank account gets frozen for whatever reason (it happens)
In the coming month I will move $10k from my local acc into my investment acc and reduce the EF to $10k across Local and Off-Shore Banks.
My Investment acc has been opened to set up a portfolio of Index Fund ETFs as there are no viable alternatives to get access to low TER index funds.
Being in the UAE, dividends from US based Funds/Stocks are taxed at 30% withholding tax (sucks) so a better option is to go with Funds domiciled in Ireland, such as BlackRock iShares and Vanguard UK to avoid the dividend tax.
CGT is 0%.
My current portfolio is:
65.59% | VWRD | VANGUARD FUNDS PLC VANGUARD FTSE ALL-WORLD | $48,883.50 |
20.21% | LQDE | ISHARES PLC ISHARES $ CORPORATE BOND | $15,061.95 |
9.82% | VBK | Vanguard Small-Cap Growth ETF | $7,315.80 |
4.39% | GOOGL | Google Class A Shares | $3,271.50 |
The main portfolio is basically a 2 fund lazy portfolio with 80/20 split Stocks/Bonds.
I gave myself ~$3,500 for individual stocks to allow myself some creativity to buy and hold individual stocks and allow the remaining 95% to remain long term buy and hold.
This allows me to feel some sense of control, whilst leaving the vast majority of my portfolio in index funds.
I currently rent and don't see that changing any time soon, the real estate market in Dubai feels ridiculously overheated ($400kUSD for a 1br appt) having risen ~30% in the past 12 months.
I could reduce my spending each month, but I am currently quite happy with my savings rate and any further reduction would take my lifestyle below a level I feel comfortable.
Confession, I spend around $800/month on restaurants :S
I ride my motorbike to work each day, a 5min commute and I have spent probably $15 on gas in the last 6 months (Love living in the Middle East)
I put ALL spending on my Credit Card @2% cashback and have a standing order to pay the full amount each month, this has earned me around $1,200 in Cashback in the past 18 months.
Tracking all of my spending on an iPhone app and have a Google Spreadsheet with multiple tabs to track ALL of my finances down to a very anally retentive level.
Looking to hit Early Retirement in around 10 years, optimistically in 9 years at 35.
Which seems
just about doable if I factor in my annual bonus and future salary increases, but i take Networthify with a pinch of salt.
My key questions are:
- How does my Portfolio look?
- Is dumping $75k into index funds ETF's the best idea?
- Anything I am missing?
- Any areas for improvement?
Thanks!
Dan