How am I Doing? & Where to

[fhaoipteh]

hi , trying to get some opinions and views outside of my echo chamber, and obviously anon for obviously reasons.

background

41years in April, married, no kids (passed on and not sure if we'll try again)

income

1st house paid off, 2nd property paid up and being rented out - 8k/mo (after utilities, tax etc)

salary after tax 50k

side hustle 1 - freelance coder - 10k/mo (net after tax, hosting, software etc)

side hustle 2 - selling on takealot/makro - 60k/mo (net profit after tax, expenses etc)

reit property investment - 4.5k/mo (700k invested

livestock investment - 6k/mo (500k/invested)

liquidity

- 1.2m in an etf

- 350k in tfsa (max out every year)

- company pays RA and i top up about 30k/year for tax writeoff)

- 100k in day to day savings (emergency fund)

- 500k in company savings account

- zero debt

- 1 x 10 year old car, daily runner fully paid

- 1 x 6 year old wife car, also fully paid

- crypto about 250k across btc and other bigger cap alts (no shitcoins!)

expenses

- domestic 6k/mo

- groceries & wife allowance - 20k/mo ( what is the PC term for this?)

- personal spending like clothing/eating out/ - 3 to 5k/mo

- 3k water/lights/utilities etc

- medical paid by company

- subs like fibre, insurance, armed response, garden service, software etc 2k/mo (running via company as expense)

Wife does a bit of graphic design but thats hers to keep (4 to 5k/month sometimes)

So yes, i'm fully aware of my privileges and wealth, while I'm no baller billionaire, i am blessed and do not take this for granted.

We live pretty frugal, do an annual overseas trip annually (hoping to make it twice a year) but nothing super crazy. typically spend about 50 to 60k on the entire trip (flights, hotels, spending, food etc). Try to do 2 or 3 local weekend trips to the coast, kruger and similar.

Did some extensive renovations last year so that burned up about 300k and then another grudge purchase last month for 130k for a solar inverter setup

Right now, want to bring up my lifestock & reit investments to 1m each, which should give a combined 15 to 18k/mo give or take. Also eggs in 1 basket thing so dont go 'all in'

Where to from here?

bored of salaried work but the pay is good and pretty flexible (remote sometimes, flexi hours, take leave anytime) But for the last few years I see zero challenge and zero growth, I find myself also becoming stuck in a rut and not learning new skills. Since last year I've resorted to hiring an out of work chappie (at my cost) and letting him do the boring work for me. Boss doesn't care, as long as targets are met and work is done everyone is happy. chappie loves it as he works exclusively remote and I'd like to believe he's happy, This allowed me to grow my side hustles.

Lets not forget the comfort of a predictable salary deposit every month.

Side hustles are good but the figures I gave are an average over 12 months of 2022, some months spike, some months dip. My fear is if I quit and side hustles dry up?

I hate corporate and would hate to start afresh at a new company.

Strongly considering emigration but with no formal qualifications, I cant see this working out. And 40+?

Savings? more into EFTS? buy property? buy a business? how does one invest into businesses, not necessarily silent but not fully hands on too?

Happy to answer any questions too?

 

[faith4l]

@fhaoipteh I feel like you are missing some goals/planning

• Have you thought about what retirement will look like for you? Have you considering something like r/financialindependence, r/coastFIRE ?
• Have you calculated any figures to get an idea of how far out you are from retirement and what you need to do to get there?
• From above, have you determined what sort of risks and percentages you are willing to allocate to speculative investments or riskier ventures like startups, venture capital etc.
• Maybe allocate some time to learn a new skill after work or take on a hobby. Maybe even create a ToDo list of things you would like to do or learn. Take up a sport, do some community things etc. At the end of the day we make money to be able to live and then some to live comfortably and experience what life has to offer...

Above is basically for you get a picture of where you are, where you want to be, what you are willing to speculate on etc. Get a more clear picture of your financial goals and where you want to be (including your wife) and what expenses will look like during retirement or even early retirement.

Next up is incomes. Seems like you have a pretty good low down of taking advantage of tax deductions and structuring for this. Given your income and financial position and if you haven't already, I would consider speaking to a good tax consultant just to have a look at things and if there is anything you can maximize. Having a check up now and then is not a bad idea.

Apart from tax considerations, you side hustles. If they were to dry up (or have no tenant placement for rental), how will that effect you? Can you live just off your primary income? Make sure you factor in enough buffer for the risks of these IF they would to effect you financially on day to day.

You didn't mention your pension fund value so one can't really get a clear overall financial picture. I know livestock is slowly becoming a thing, but I heard good and bad about it. Going to assume here you know the TnC's from it in and out and the risks associated both normal and extreme? Do you need 500k in company account? Sitting cash is just depreciation. Also consider your exposure to property due to having physical as well REIT's which assuming here is all based on South African market? So that might be a bit correlated. But this is speculation my side as I don't know your financial position and needs. So not going to dive more into investment options here as that is impossible to determine without allot more information. But here again, maybe consider chatting to a fee based CFP as a once off to get another perspective as well.

 

[fhaoipteh]

@faith4l thanks so much. just the kind of perspective and advice i'm looking for!

cant ever see myself 'retiring' always need to have something and to keep busy with,

RA is on about 800k give or take. Its one of those set and forget, and only really look at it when doing tax submissions. tbh performance has been quite useless in recent years.

Tax wise, yes, things are structured well. Side hustles split into Turnover Tax companies etc etc

Forgot to mention, have about 200k tied up in a vcc fund, that tax loophole closed a few years ago but it matures in 2 years i think. Expecting a decent return

Would love to speak to a fee based CFP - i found traditional FP's simply fill out forms and collect commissions. Spoke to at least 5, all just rattled off questions of a script with zero value. The last one was more curious about my business/hustles and wanted to build something like that for him. They seem more biased and pushy toward funds where they get a nice juice commission.

500k in company account - yes, for now its in a fixed deposit earning about 6%, i know i know. I'm researching a few products to import and may use about 100k of that to fund this.

 

[faith4l]

@fhaoipteh

cant ever see myself 'retiring' always need to have something and to keep busy with

That makes two off us. Plan is to retire from permanent employment and then just do a contract here and there. Say 1-3 months at a time and further just enjoy live.

Have a look at this post. Another user that discusses his FIRE journey if that can be of any value for you.

i found traditional FP's simply fill out forms and collect commissions. Spoke to at least 5, all just rattled off questions of a script with zero value. The last one was more curious about my business/hustles and wanted to build something like that for him. They seem more biased and pushy toward funds where they get a nice juice commission.

Glad you didn't fall for it. These traditional brokers screw so many peoples finances its crazy that its legal. I wish there was more regulation around this but it is what is it... Not all of them are like this, but there is a shift to avoid these brokers and rather just go directly to independent CFP's and fee based. But you get bad apples everywhere. Some places just more than others...

 

[icecreamassassin]

@faith4l

maybe consider chatting to a fee based CFP

Could you perhaps recommend one, or a firm that does this? I'm struggling to find someone I that doesn't rely [exclusively] on commission.

Not sure if you'd want to name names here, would you consider shooting me a PM with info?

 

[johanaanderso]

@fhaoipteh You are doing really well, good job on your financial situation.

If you are looking for something to give your wealth meaning and allow for some personal growth, I think the answer is quite simple, invest into stocks in big name companies you trust and get a new hobby or get back into an old hobby you used to enjoy as pastime, preferably something you could do with your wife.

Also as someone on here mentioned, charity work and a small donation to many noble causes is also a very good way to make your wealth into good change around the country, this could also help give your wealth some meaning.

I hope you come right, have an awesome weekend!

 

[fhaoipteh]

@johanaanderso agreed a million% and thank you for the kind words.

I generally 'allocate' about 100k a year (give or take) then throughout the year it gets donated.

Roughly 2/3 of it usually goes to registered organizations and special projects for the tax deductable, and the balance to various ad-hoc cases in our area.

With local donations, i avoid being directly involved, this tends to make you their go-to ATM. usually via a church leader or someone that is involved in outreach work.

Not big stuff, like maybe helping with school fees, uniforms, or electricity, or groceries.

You'll be surprised at the number of 'middle class' people who are battling and drowning in debt. Many are mix of bad money money management, pandemic and poor luck. But no excuse and everybody deserves a hot meal, roof on their heads and a bit of groceries to avoid daily grinding

 

[johanaanderso]

@fhaoipteh "You'll be surprised at the number of 'middle class' people who are battling and drowning in debt.", This is very true, I've had friends and family work through stuff like this and its really draining, but collectively we help each other out when needed and get through it together, then shared nice cold ones together after the whole ordeal, not many people have that luxury and it's really difficult to overcome it, especially after this whole pandemic.

Thanks for what you do contribute though, I'm sure those who really need it are very content with what you have given them, keep it up!

 

[fhaoipteh]

@johanaanderso so one common thing i pickup on folks who are going through a rough patch.

They dont ask for handouts. The ones that constantly beg and ask are the ones to avoid sadly.

One pandemic example. guy lost his job etc etc during peak covid. we helped the family out with rent for a few months, groceries etc - lets say about 20k in aid.

6 months later he rings the doorbell of the guy who arranged it all. 20k in hard cash. "thanks for helping me, i'm doing much better know, i want to pay back what you gave me, and pass it onto someone else"

 

[tjbutter]

@fhaoipteh Sorry this is not an answer but a question out of curiosity - is your takealot side-hustle automated? Like a drop-shipping type of set up? Or manual product creation, shipping etc..

 

[fhaoipteh]

@tjbutter very much manual. typically i think this is collectively about 1 hour daily.

I'm considering hiring someone but its very manageable for now.

 

[strangekeys]

@fhaoipteh If you decide to and the position is still open I’d be very eager to work under you. I’m a recent finance graduate looking for work.

 

[jdn2604]

@fhaoipteh Well done this is something i want to achieve

Im only 24 though.

Really makes one think of more side hustles

 

[fhaoipteh]

@jdn2604 my only advice would be to Never. Ever. rely on a single source of income.

If you're salaried, you're disposable. Ignore the corporate b.s. of we're all family yada yada. You do you. Put 100% at work no doubt, dont shit where you eat, and have integrity & honesty in your interactions.

I know our country is gone to shit but with the lawlessness comes opportunity. Anyone and everyone can start selling things, or a service, top open a pty ltd is minimal expense and effort.

I dont come from money, i have no trust fund or estate lined up. So from a young age i was taught to be thrifty & pragmatic with money.

 

[anonymous79]

@fhaoipteh Ure side hustle at makro at 60k per month net is incredible. Congrats! Throw us some crumbs here...what do you sell?

 

[fhaoipteh]

@anonymous79 not makro exclusively. makro & takealot and sometimes onedayonly.

hope you understand, i'd rather not get into that. Takealot in particular is hyper competitive and its taken me the good part of 3 years to get to this level

 

[surendered12345678]

@fhaoipteh Op when did you first begin side hustles to make all the extra money?

 

[fhaoipteh]

@surendered12345678 for the takealot/makro - since covid. grit and tech savvy and luck. I imported from china (about 10k) sold, reinvested, sold, lather rinse repeat. Fortunate that i didnt 'need' the profit for life expenses and could pump it back over and over and over.

for other stuff several years, just word of month, people call for a project assistance etc do the gig and get paid.

 

[tetra]

@fhaoipteh Hi

Quick question: What kind of returns are you averaging on the reit and livestock investments respectively?

 

[fhaoipteh]

@tetra reit is 9.4%pa

livestock - 14%pa

both returns monthly, as mentioned it is high risk