Saturday, March 25, 2023

Breaking Free: I have achieved FINANCIAL INDEPENDENCE 3.0!

I have achieved the FI 3.0 target I set for myself. Let me share my journey to get to this point:

I achieved FI (Financial Independence) 2.0 in Jun 2021.

I have been aiming for FI 3.0 since Dec 2021 (see this post:

Firstly, a recap of what is FI 3.0. It has a few buffers baked in:

  • CPF is not included in the Starting Balance - this is the first buffer
  • The withdrawal rate is reduced from 4% to 3% - this is the second buffer
  • Certain expenses are assumed to last till perpetuity, even if it may not be the case. An example is children's class fees. 

Below is the amount I have accumulated up to now:

Which is more than the 'Required Savings' necessary for FI:

In other words, I have achieved FI 3.0!!

I have started this journey ever since I completed my graduate studies. Roughly, it took me 11 years to get to this point. 

I just want to share some practices that helped me get to this point:
  • I own only 1 property - my HDB flat, which is my matrimonial home
  • No car
  • I use freebies whenever possible - my watch is free, my shoes are free, and my bag and jacket are given free from my previous companies
  • For 2 years, I took MRT to work at unearthly hours (exit station before 7.45am) to spend $0 on transport
  • Side hustles - I took up side hustles including food delivery, paid surveys, writing 2 blogs (one technical blog and one FI blog)
  • I do repayments to my mortgage loan regularly - now my loan has only ~$950 remaining
  • I invest regularly - in stocks and bond
  • Whenever I get upset at work, I keep in mind I have a bigger goal in my life - to achieve FI and I endured it to get to this point
In hindsight, some points above actually didn't help much on my FI journey (paid surveys paid peanuts for example), but they helped build the discipline and the conviction I needed to achieve FI. No regrets.

What's next for me? Well, I plan to take a sabbatical (minimum 9 months) from my present company.

Here are some of my reasons for taking a sabbatical:
  • Be able to sleep better at night - e.g. for the past week I can't get to sleep until after midnight, or very often I wake up 2-3am, think about work, and then am not able to get back to sleep
  • I burst the income ceiling for BTO long ago - by taking a sabbatical, I will draw no CPF, which will qualify me for our dream 5-room BTO
  • Issues at work - unsupportive and unhelpful colleagues that only care about themselves, not enough support from bosses, too many whiners and complainers at work thus creating a toxic environment, etc. Typical work gripes I guess
  • Real-life test of my FI expenses - all my expense calculations to date are based on when I am still working full-time. Will my expenses stay the same after I stop working full-time? Only by stopping full-time work will I know for sure
  • Find time to work on my technical blog
  • Find time to create more quality articles for my FI blog (yes, this blog)
  • Find time to spend more quality time with my kids e.g. if my kid is sick, he can stay at home instead of going to my parent's place, or I can avoid a scenario whereby I have to juggle taking care of him and working at the same time
  • Find time to do some self-study
  • Find time to rest more - I got too many comments from colleagues and family that I look tired over the past few years. I want to do something about it by finding time to get proper rest and doing something that I am truly passionate about
  • Find time to start exercising more regularly instead of just once a week - need to take care of my health. Now in my 40s, health issues are starting to pop up: eyesight not good, catch bugs easily, knee pain, etc. 
  • Find time to have the freedom to travel a bit further to get a good lunch instead of eating the same stuff around my neighborhood because I have to get back to work 
  • Find time to do volunteer work and help the community - I find this to be meaningful
  • Find time to be closer to nature - will like to go for regular nature walks and not have to take leave to do so
  • Find time to do some administrative things - writing my will, fixing my laptop, and changing to a cheaper phone plan are some of them
  • Find time to launch my startup. Yes! I have many ideas! Now that I am FI, coupled with my work experience over the past few years, there is no better time to start!

Do you have any questions for me? Ask below!

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