Read also: Thoughts about Financial Freedom part II
There is an increasing number of blogs and courses these days talking about methodologies of investing in stocks, advocating financial independence or financial freedom (I am using the 2 terms interchangeably in this post, you could read more on their subtle differences here). They advocated how good it is to reach the stage of FIRE (financially independent and retire early) in life, how one could achieve FI through investing (like bao jiak) and packaged it with methodologies which are often narrowly taught as "long-term investing in dividend-yielding stocks".
The holy grail of reaching financial independence is not in its entirety about becoming a skilled (passive /value) stock investor. Those who are inspired by Robert Kiyosaki like to talk about portfolio and passive income by investing - forgetting that he wrote financial intelligence is a synergy of accounting, investing, marketing and law. That essentially pointed to starting your own business and paying less taxes.
Becoming a skilled stock investor is just one part of the equation, which is to help generate an alternative income stream to our day job or business.
It may be perceived by some that once they have learnt the 'art' of investing, they can naturally be FIRE. It might seem more appealingly so in time of a bull market. However, we have to bear in mind that no matter how skilled we are in investing, we are still a tiny boat in the vast market ocean. In another word, we are always at risk of market downturn and capital losses that could be out of our control (heads-up to passive investors who want to sleep on vested stocks LONG term). There is nothing wrong with that, as long as we are prepared and have the stomach to tide over the downturn. Right? I beg to differ.
There is an increasing number of blogs and courses these days talking about methodologies of investing in stocks, advocating financial independence or financial freedom (I am using the 2 terms interchangeably in this post, you could read more on their subtle differences here). They advocated how good it is to reach the stage of FIRE (financially independent and retire early) in life, how one could achieve FI through investing (like bao jiak) and packaged it with methodologies which are often narrowly taught as "long-term investing in dividend-yielding stocks".
The holy grail of reaching financial independence is not in its entirety about becoming a skilled (passive /value) stock investor. Those who are inspired by Robert Kiyosaki like to talk about portfolio and passive income by investing - forgetting that he wrote financial intelligence is a synergy of accounting, investing, marketing and law. That essentially pointed to starting your own business and paying less taxes.
Becoming a skilled stock investor is just one part of the equation, which is to help generate an alternative income stream to our day job or business.
It may be perceived by some that once they have learnt the 'art' of investing, they can naturally be FIRE. It might seem more appealingly so in time of a bull market. However, we have to bear in mind that no matter how skilled we are in investing, we are still a tiny boat in the vast market ocean. In another word, we are always at risk of market downturn and capital losses that could be out of our control (heads-up to passive investors who want to sleep on vested stocks LONG term). There is nothing wrong with that, as long as we are prepared and have the stomach to tide over the downturn. Right? I beg to differ.
If we want to talk about investing skills in general, it will be about learning how to invest in different asset classes and knowing when to rotate between these asset classes to protect and grow our net worth during change of economic conditions, which would put us on a higher pedestal and minimize our risks during downturns.
Back to the part aboutbeing inspired financial intelligence by Robert Kiyosaki.
Back to the part about
Despite being inspired and all to get out of the rat race (after reading the Rich Dad, Poor Dad book or playing the cash flow game), not many of us caught the insights or have the gut to start or acquire a business for 'passive' income. 'Hey, it is not passive' you would argue, since one would be expected to put in more time and effort in running a business than simply clicking the mouse to make investment transactions. Hey wait... don't we need time and effort to research, analyze, place orders and track your investments too?
I secretly wished that there are more inspired finance bloggers out there who would also talk about how they have ventured and failed/ succeeded in businesses and passive income generation, instead of posting monthly stocks portfolio update and talking about only results.
At the end of the day, I realized that we don't need to pursue financial freedom in order to do what we want in life. Achieving financial freedom is nothing more than breaking away from what we dislike doing or are stressing over for earning a living. As long as one's passion could generate a steady source of income to be able to live comfortably - whether is it in investing, running a business, blogging or simply doing your day-to-day routine job, you are already free in a mental sense.
I secretly wished that there are more inspired finance bloggers out there who would also talk about how they have ventured and failed/ succeeded in businesses and passive income generation, instead of posting monthly stocks portfolio update and talking about only results.
At the end of the day, I realized that we don't need to pursue financial freedom in order to do what we want in life. Achieving financial freedom is nothing more than breaking away from what we dislike doing or are stressing over for earning a living. As long as one's passion could generate a steady source of income to be able to live comfortably - whether is it in investing, running a business, blogging or simply doing your day-to-day routine job, you are already free in a mental sense.
Hey I am so inspired by this lady called Marie Kondo today. Not on the minimalism or tidying part, but by how her bizarre passion made her fortune and fame.
That is really earning from one's passion!
Rainbow girl,
ReplyDeleteYou've peeled behind the curtain and saw the truth ;)
I like Marie Kondo too!
Read her book at the library.
A woman; and young woman in Japan some more!
How's that for defying the odds?
Sort of make you think about anyone and everyone right?
Remember your observation. These are the laggards that come out of the woodwork ;)
Hi SMOL,
DeleteYeah, makes me wonder who in our blogosphere would one day become 'Marie Kondo'.
I watched her video - https://youtu.be/rAC4sprfqgU (recommended to watch at 1.25x speed if you can catch her English w strong Japanese accent). What a cute and personable speaker. I thought tidying is just common sense chore but her concepts blew me away!
[Opps, I realised my second paragraph's kiyosaki part was missing earlier.]
Hi Rainbow girl,
ReplyDeleteMy Likes below: :-)
At the end of the day, I realised that we don't need to pursue financial freedom in order to do what we want in life. Achieving financial freedom is nothing more than breaking away from what we dislike doing or are stressing over for earning a living. As long as one's passion could generate a steady source of income to be able to live comfortably - whether is it in investing, running a business, blogging or simply doing your day-to-day routine job, you are already free.