2022 – what a year! Portfolio and financial decisions in review

2022 was a crazy year for me. How did my investments do? Let’s dive into the full year update!

Portfolio performance

2022 was a tough year in the markets and my portfolio ended the year lower than the previous year – the first time this happened since I started tracking:

Portfolio at year end in SGD

What was the reason? In short, strong fresh investments could not make up for the sinking markets:

Waterfall chart showing my investing performance in 2022

I managed to save and invest SGD 126,335 from my salary and reinvest SGD 12,381 in dividends. This was offset by capital losses of SGD 148,339. On the bright side, I managed to save quite a bit of cash and ended the year down only  ~SGD 10k.

Where did all the money go?

For years I have been tracking my finances carefully and 2022 was no exception:

Where did my money go in 2022?

My salary had been nicely growing all these years with 2022 being the first year with a net income over SGD 200k. Interestingly, expenses stayed on the same level during the last three years. In 2022 the highest spending category was again “travel” amounting to 19% of expenses.

2022 I got rid of my car on which I spent about SGD 5k per year in parking fees, fuel, maintenance, taxes etc. Selling the car felt great, one less thing to worry about.

I also built up a small cash buffer, since I quit my job this year and wanted to keep some cash just in case.

In relative terms, this is how my money was used in 2022:

Where did all my money go, relative

I am proud not to have succumbed to lifestyle inflation and to have managed a 66% saving rate (72% when counting the cash buffer) in 2022.

Investments in 2022

As I had planned, I invested money each month throughout the year:Investments by month in 2022In June I got paid a large bonus in my old corporate job. It was especially high, since I “over-performed” and got a special award. I do not think it was justified, as I was spending most of my time preparing to resign and sort out the new life.

Portfolio allocation

Portfolio allocationThese days, my portfolio consists mostly of stock index funds, held in ETFs. I did not add to my bond holdings and am not planning to. I sold most of my REITs and only keep a small position. I will only add to the index funds in the future.

Can I retire yet?

Can I retire yet?

This chart shows the 12-month average of expenses, vs. a monthly retirement income (green line), which my portfolio can support.

Unfortunately, my spending is too high / portfolio is too small to retire at current income level.

Big life change: quitting my cushy job

In 2022 I quit my very well paid job at megacorp and made a plan on how to survive on less than 20% of my previous income.

It is a high-risk, high-reward strategy, as I have equity in the startup and there is a 5-10% chance for a huge windfall.

From a pure financial perspective, it would have been better to tough it out 5 years more at the large company and then retire at the ripe old age of 45. From a lifestyle perspective though, the startup is hard to beat: instead of 6-8 MS Teams meeting per day, I just have 4-5 a week. I do not need to commute to any office and can live wherever I like.

I am typing these lines from the Spanish coast, my small apartment overlooking the sea and treating me to spectacular sunsets every day. Later in the year I will live in other places, wherever I like. In a way I have achieved my dream retirement lifestyle already now.

Downstairs of my apartment

Work wise, it is nice to be making real differences in a small business, as compared to being just one of >100.000 employees in megacorp, so I could not be happier for the time being.

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