I have always wondered what direction this blog will take when I started it 2 months ago in Feb 2016. It seems to be a mix of the technical and psychological aspects of personal finance. As much as I like writing about the things we do and updating the numbers in our portfolios, income & net worth, I enjoy exploring the psychology of personal finance as well.
After all, our values and beliefs drive the actions we take for better or for worse. Besides, I’m about to turn 30 in June and there’s nothing like a major life milestone that makes you become more self-reflective. One valuable lesson we have learnt from our experience of studying, working & living in Australia & Singapore and getting on to this journey of financial independence is the importance of letting time pass.
I read personal finance blogs from all around the world and it’s amazing how we can be at such different stages of our lives but yet have the same goal. The problem for me is when I start reading about bloggers that have already achieved the goal. The way they lead their lives is how I imagine it would be like for us – to be able to focus & do what you want and what matters to you without the financial pressure to make it work out.
Working in the office
Even though we know the steps we need to take to get there, it might be another decade or more before we achieve it. We work in the accounting and banking industries as accountants. While not the most exciting occupation, the pay is decent and has already put us in a better financial position. If we keep working in the office for the next several years, it might even shorten the time it takes to reach financial independence. However, working in the office can be a real grind every day. If we are to jump out now and do something that matters more to us, it might lengthen the time it takes to achieve financial freedom.
Now you can start to understand the topic of this post. The more I think about it, the more I realise that when you have figured out what needs to be done, doing it is sometimes just a matter of letting time pass. We do what we can to increase our salary income by working hard & smart but no amount of career navigation will significantly shorten the time we need to get there. It really comes down to just not overthinking it at work, reducing our expenses and keeping ourselves focused on the goal.
What we also try to do on the side is build up another source of active income. This doesn’t refer to our dividend & interest income but should come from putting our effort into another active activity. Again, it takes time for the steps we take to yield results.
The same lesson applies to our investments as well. When we got serious with investing in 2015, we over allocated our cash on hand to the stock market because we were anxious to really make some ground in our journey to financial independence. In short, we rushed it. What should have taken years to build, we tried to do it in a matter of months.
The recent bear markets have taught us that you can’t speed this journey up by over-investing. We have to be patient, do more research, allocate cash to the stock markets according to our target asset allocations and wait for it to work. Buy consistently across time and even more so during bear markets but it can’t be done at once. That’s how we learn and that’s how knowledge compounds.
Time builds character and we have both grown up significantly since graduating from university. We have learnt not to over-plan when it comes to life because we have no idea what’s actually going to happen in the future. We couldn’t have imagined ourselves working in Melbourne, Sydney and Singapore over the next 7 years after graduating in 2009. How do we know what will happen in the next 7 years from now?
It’s frustrating to know that the mistakes we have made along the way have added years to the timeline. But those mistakes came from not being afraid to try and they made us who we are. As long as we keep ourselves focused on the goal of financial freedom, the importance of letting time pass is to allow ourselves to actually enjoy this journey wherever it might take us. Life doesn’t stop living and neither should we.