My net worth update | Closing in on Financial Freedom

What I did to grow my passive income

Here are the 3 secrets I use to earn 20% return on investment.

  1. Look for relatively undervalued dividend growth stocks. I use the stock screener at Yahoo Finance to help me find the best stocks.
  2. Do not sell too early. The only time you should consider selling a stock is if you need the money for something else better. People often lose more money by getting out of a stock too early than by choosing a bad stock to buy in the first place.
  3. Use other people’s money to make money. If you buy a house with a 50% down payment, and borrow the rest, your returns will be 2x. The same goes for any type of investment, not only real estate. As long as you choose quality stocks to buy, you will not lose money borrowing to invest.

Despite making only $60,000 a year from my job, my investment portfolio has grown to over $1,000,000 over the last 10 years of investing. The money I earn from my financial assets is called passive income. πŸ˜‰ I write about how to improve my passive income on this blog all the time.

I’ve written about buying Apple stocks, high yield bonds, real estate trusts, and other investments that have mostly performed exceptionally well over the years. I like sharing my financial stories so that others can learn from them. πŸ™‚

My screening process only looks for the best dividend and growth stocks that tend to outperform the market over time. Using leverage also helped a lot by multiplying my returns.

Thanks to some recent stock purchases I’m now making about $29,000 a year in dividend and interest income. This was done by analyzing stocks, and picking the winners. πŸ™‚

 

Planning to retire in my thirties

My living expenses is about $30,000 a year. This means I am very close to being financially free. Hurray! πŸ€— Investment income tends to be fairly stable despite volatility in the underlying assets. So I will probably achieve financial independence within the next couple of months!

Financial independence means I will earn enough income from my investments to not ever have to work for money again. There are different types of FI you can choose.

I didn’t expect to hit my goal this soon. My initial plan was to be financially free in 2022 – when I turn 35 years old. But now it appears financial freedom could be just around the corner! πŸ˜€

 

Since I’m further ahead on my financial journey than planned I have decided to reduce my financial efforts by quitting all freelance work. This means going forward I will be working only 45 hours a week instead of 50 hours a week. This will give me more free time on the weekends. But I will keep both my full-time and part-time jobs for now. 😬

Liquid’s Financial Update June 2020

*Side Incomes: = $4,600

  • Part time job =$800
  • Dividends =$1300
  • Interest = $600
  • Rent = $1,800

*Discretionary Spending: = $1,800

  • Food = $400
  • Miscellaneous = $500
  • Interest expense = $900

*Net Worth: (Ξ”MoM)

  • Total Assets: = $1,540,400 (+$10,200)Β 
  • Cash = $20,800 (-32,500)
  • Canadian stocks = $336,900 (+35,700)
  • U.S. stocks = $153,700 (+3800)
  • U.K. stocks = $19,600 (+700)
  • Retirement = $152,200 (-900)
  • Mortgage Funds = $39,300 (+3100)
  • P2P Lending = $36,900 (+300)
  • Home = $331,000 (assessed land value)
  • Rental Unit = $450,000 (2020 purchase price)
  • Total Debts: = $518,500 (-3,300)
  • Home Mortgage = $181,300 (-500)
  • Rental Property Mortgage = $312,000 (-800)
  • Margin Loans = $25,200 (-2,000)

*Total Net Worth = $1,021,900 (+$13,500 / +1.3%)
All numbers are in $CDN at 0.73/USD

 

It was another positive month for the financial markets as stocks continue to recover. I filed my income tax in June. I have to pay about $2,500 in tax adjustment to the government this year because I didn’t use all of my deduction room.

I’m planning to use all of my saved retirement account deduction for next year’s tax season when I have to offset the huge capital gain I triggered this year from selling the farmland – which unlocked about $250,000 of equity. I’m so happy I made a triple digit return with my farmland investment.

I plan to deploy more capital soon into dividend growth stocks to continue growing my passive income. And as usual I will be posting what I buy on this blog.

 

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Random Useless Fact:

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seapotato
seapotato
07/06/2020 7:50 am

waaa, congrats! do you do detailed tracking of your monthly expenses or is it just an estimate? I’ve seen some pretty crazy spreadsheets but always have been too lazy to enter in all my spending lol

Roadmap2Retire
Roadmap2Retire
07/06/2020 8:01 am

Well done Liquid! Thats fantastic progress and great to see your progress over the years and hitting that $1M milestone and getting that much more closer to financial freedom. Keep up the great work and wishing you the best

Love that “inner peace & not my problem” image at the bottom lol….so true.

R2R

Investing Pursuits
07/06/2020 9:04 am

Congrats on being close to financial independence. Well written post.

You still hold Cineplex? If so, what are your thoughts on it? I still have my shares, but regretting not selling when it went above $34 after the proposed sale. I was so close to pulling the trigger on it. With an ACB around $36, I am down a lot on Cineplex.

Vancouver FI
Vancouver FI
07/06/2020 10:05 am

Congratulations, I’ve been following this blog for some time and it’s really inspiring to see your fiscal update posts. Are you still thinking of buying more real estate? I’ve been watching the Vancouver market with hopes of a discount but haven’t seen any yet.

P C
P C
07/07/2020 2:08 pm

Congrats, glad you are on your way to financial independence! Last few times I tried to make a comment… it didn’t go through I think!

Fee
Fee
07/07/2020 8:08 pm

Congrats on reaching the end of one life stage and starting on the next exciting challenge…Family !πŸ˜€

immi
immi
07/09/2020 5:57 am

Hey Liquid, congrats on an incredible achievement. What are your thoughts on your assets on Lending Loop? I have found that around 10% of my holdings are in some sort of arrears due to covid-19. Hope you’re keeping safe!!!

Money Mechanic
07/10/2020 4:09 pm

Well done on the passive income, super exciting.

AlW
AlW
07/11/2020 7:26 am

Ever think you’ll get married have a few kids and the expenses will jump?

GYM
GYM
07/11/2020 8:59 pm

Congratulations Liquid, this is a huge accomplishment for being so young. You are under 35, right? You made your goal same year as Frugal Trader did his $60K annual goal!

The CCB provides you with income for children under 6 but if your household income is too high it claws back to $0.

AlW
AlW
07/12/2020 5:17 am

8k/kid seems low to me. It’s the hidden costs, the babysitters, the diapers etc that add up. As GYM mentions don’t count on any money from the government as you’ll likely not get any. But it’s all definitely feasible especially if you get creative!

R from AB
R from AB
07/23/2020 11:25 am

As a first-time parent, I also was apprehensive about our first new-born. But you know what? You learn as you go.

Sure, I wasn’t the perfect father but they still love you the same. Good luck!

tony
07/12/2020 8:39 am

that’s awesome to see Liquid! I’m always super intrigued in your blog posts since a part of me is planning very carefully to go to BC and another part I want to see how someone like yourself, living in arguably the most expensive part of Canada can STILL live comfortably and retire wealthy… I know there are less expensive parts of BC for sure but I’m just assuming the overall expenses of living there is definitely more than where I am right now in Winnipeg

DreamingOfDividends
07/15/2020 6:27 pm

I’m impressed that you have reached this milestone at a young age. Congrats! I have thought about investing in property, so it’s interesting to read about your perspective.

Steve L.
Steve L.
10/30/2020 12:42 am

Congratulations on FIREing.

I am in a pretty similiar position with a couple of rental properties, mortgage notes, and stocks etc. The stocks I have them spread out into 3 different brokerage accounts in US and Canada.

Do you use any program to keep track of your asset column, networth and balance sheet or do it all by hand?

Would like to organize the various stocks as well to better view the allocations by sector.

Thanks for your advice,

Steve