Tag: T_breakaway11

see open blog

1998bachelor’s fin-health #tuxedo

Posted on by tiger40490

update:

The trigger/inspiration — discussion with Jun.Z’s son, and other recent graduates.

In 1997 or 1998, I met an NUS EEE graduate one year above me. In his sleeveless tuxedo, he was running his own tiny company with a young employee. He had been doing that since graduation, and had never worked for any employer. In hindsight I assume he was unmarried and staying with his parents.

He was the first among my peers to make this breakaway observation:

“In this place and at this time, NUS engineering graduates like us can always find a job as long as we aren’t picky. But In this place and at this time,  we don’t really need to worry about livelihood, so why do we need a salary in the first place?”

His words were backed by his action, which left a lasting impression on me. (Among other things, I started watching my Fuller Wealth growing progressively towards 20Y, and later quit my job.)

On the bright side, my cash flow self-assurance in my 20’s was not based on exclub but based on FullerWealth, brbr, benchmark to median household income.. all valid criteria in the 2020s.

On the less-bright side, there was a pervasive [1] but largely unfounded, hearsay /apprehension/ among my cohort of recent graduates.

  • mate selection .. is ALL about exclub
  • home purchase .. 3BR needed, according to peer pressure .. “2BR won’t be enough for a growing family”.
  • .. In Chinese cities, this pressure was/is even worse than Singapore
  • parenthood .. SGD 1M/child according to peer pressure, including some $300k “needed” for college
  • .. In U.S. middle-class, the college price tag is even worse than Singapore
  • medical .. my mom said something like $100k (四十万)
  • inflation (+retirement) .. threatened to shrink each (saved) dollar by half every 20Y or so.
  • — my career worries as a young techie
  • “My income is not rising as fast as my cohort” .. but based on what data?
  • “My skillset is not broad enough. I’m boxed in and have a single narrow skillset compared to my cohort…” but who?
  • not learning enough, not competent enough
  • short runway .. by age 30 I am expected to be competent, independent, possibly a team lead
  • long struggle ahead, over 40Y
  • too many career choices… “Is this domain right for me? Will I regret?”

Q: how has my idea of livelihood changed since?
A: first hand experience convinced me how little I actually need in each area, in terms of livelihood. I now see those second-hand beliefs are absurd and illogical. This is MY breakaway from the conventional wisdom on livelihood. In terms of livelihood, it’s somewhat similar to that tuxedo guy’s breakaway observation.

As I told Jun.Z’s son, At that time I had basically no savings (before I started saving like crazy.)

Q: how has my livelihood (cash flow high/low ground) changed since?
A: My living standard has increased with a growing family size, but my brbr has remained healthy. Beside having a family and growing old, my #1 biggest change since 1998 is my career longevity [including a projection of lifelong cumulative salary].

You may say “Hey, you have limited evidence of your career longevity projection. Countless derailers could pop-up.” I think differently. Rather than naming some achievement, some milestone as the “#1 change since 1998”, I pick career longevity. The future is more important than the past.

[1] So widespread and profound that it was impossible to stand firm and unaffected… 三人成虎. Even today, I need to stand resolute against a similar brainwash about branded college, SDXQ, home upsizing. As discussed with Tanko, one major misstep (mis-punch on my punch card) would cost my current comfortable ezlife on my cash flow high ground.

car ownership ] U.S.as part@livelihood #S.Liu

Posted on by tiger40490

k_X_car_dependency

Hi LS,

We discussed this topic repeatedly over the years because car ownership is a big headache for me. Today I want to revisit it in the livelihood context.

Fact: In 2009 and 2018 I have twice earned my driving license, each time spending $1000 – $3000 on practice lessons.
Fact: in 2017-2018 I also drove Zipcar about 30-60 times, for the sole purpose of self practice for self-reliance.
Fun Fact: When a batch of my Indian colleagues moved from NY to Salt Lake City, they decided to take up driving, implying that these immigrants had not learned to drive for all those prior years! I heard this story in a sharing session. I think some of those speakers have a spouse who was a driver. Indian immigrants mostly settle in NJ, not known as a car-lite location.

Q: Given how much I dislike/hate driving, why did I “invest” so much time and money?
A: future livelihood needs, just for the family (not for myself … since I can cope well without a car).

Q: What are the alternative arrangements for the sake of family livelihood?

  • XX) public transport, for long distance
  • YY) bicycle and walk, for short distance
  • ZZ) Uber and occasional car rental. For the sake of livelihood, this has to be occasional, otherwise too costly.
  • WW) friends and neighbors? Only occasionally. Can this be a long-term livelihood solution? Not for me. I don’t like to inconvenience them.
  • online shopping

In the big picture, as head of the family I can choose either AA) car ownership or BB) make do without car ownership. This choice will be one of the fundamental decisions when my family relocates to the U.S.

Q: is BB realistic for family livelihood? I accept that Perhaps my past U.S. experience was brief and not convincing.
A: realistic only for a suitable location.

In my U.S. years (alone or with family), I relied 99% on XX/YY. I used ZZ/WW only for some airport or relocation trips.

In Singapore, we have relied on XX/YY. We use tax a few times each quarter.

In Beijing, my parents have relied on XX/YY until they grew too old, and cash-rich enough for their remaining years. Now they increasingly use taxi on a routine basis.

Quora.com also has similar individuals who share their experiences, presumably without commercial motivation. One Quora user posted “outside of NY/SF/Chicago, the public transport infrastructure exists solely as a lifeline for the poor and elderly.”

Another Quora user posted “If I drive to work it takes 45 minutes. If I take the bus it takes 2 hours.” Two hours one way would be a livelihood issue. My 8Y experience in NY/MA is much better, partly by planning. 99% of the tech jobs I know are located within reach by XX/YY. Citigroup has some remote office but staff can choose not to work there. I won’t consider a Salt Lake City location if it’s not accessible by XX/YY.

I never lived in a NYC home, but I kinda believe some Quora users who said that “parking cost and extensive transit probably convince many NYC residents to live car-free”. Of course they have to give up car-dependent lifestyle choices (rarely livelihood-related) such as skiing. Give-up is nothing unthinkable — Adapting to local living condition is part of my life in many cities.

Some people (not only immigrants and the youth) don’t have a license, or have their car/license taken away for months. They all can cope without a car. In addition to the Quora participants, I also spoke to a few rare individuals who chose BB long term. I think majority of them lived in well-connected locations with better-than-average public transport.  Apart from these rare individuals, the vast majority of my U.S. peers presumably rely on an unshared car. Many of them hinted that a life without car is either an unthinkable struggle, or highly inconvenient. Did they suggest that no-car livelihood was a hardship? I don’t remember that. I guess some of them didn’t stop and think long and hard.

When I first came to the U.S. as a newly wed couple, I quickly figured out to stay close to commuter rail stations. (I guess 90% of my days in the U.S. were spent in those locations.) However, my wife needed access to Chinese markets, which is tough in several locations. Weather didn’t become a big problem as feared.

Since then, I have lived in rather few car-dependent locations, usually in the outskirts, such as Porter Square of Cambridge. So which locations present livelihood issues (possibly hardship) to a family without car? East Orange, NJ; Bushwick of Brooklyn; Juliette St of Bayonne. Based on these personal experiences, I now believe the level of inconvenience is exaggerated. (Similarly, school districts, colleges prestige … are exaggerated.) Even in my worst car-dependent home locations (East Orange), it’s possible to adapt and live without a car.

I would stick my neck out and suggest that most middle-class Americans and middle-class immigrants are not keen about adapting. Car dependency is an acquired and artificial dependency similar to our dependency on starch and animal protein in our diet. Is life without a private car a kind of hardship? Possibly, but not so unbearable. I  believe that if it is real hardship for a family, then this family must be living in a car-dependent location.  Like the impoverished villagers in remote mountainous China regions, they really need to relocate to more accessible locations.

In conclusion, I kinda agree with those rare individuals, and disagree with the U.S. mainstream, conventional notion.

Just_Say_No to creep,peerPressure.. #PerTrain

Posted on by tiger40490

Saying NO is one of my G3 most important principles in ffree, burn rate mgmt, long-term fin-security.

median household income & middle-class living standard is one of the first blogpost to introduce this JustSayNo principle.

SG government probably follows the same principle many times, but I won’t digress.

— eg: branded college and SDXQ home
— eg: retirement burn rate .. cpfLife ERS pays out about $2200/M, considered adequate for a Singapore retiree. I think this is a reasonable, sensible assessment. What if many among your cohort are building bigger nest eggs to provide $5k/M of retirement income? Would you feel the pressure to match up? This pressure is comparable to the pressure to buy a SDXQ home [Orchard mansion]
— eg: In 2011 or 2012 I hosted Haitao.Fu in my Newport home. I bought 3 small dishes from a nearby Chinese restaurant. One of them (toufu?) we didn’t finish — I kept the clean leftovers for my next meal. I have recalled this experience many times. I feel the /splurge/ peer pressure in hindsight.

I may or may not be right to assume him as a relatively thrifty student. He didn’t show any negative reaction about our meal but now I assume he has moved to higher positions on WallSt… In hindsight, I feel he might have been shocked by my thrift, even though the meal was way more than basic-healthy!  I probably spent USD 40. In hindsight, I feel a more “decent” delivered meal would be 50% higher. Leftovers would be … discarded?

— eg: Personal Trainer (fitness)
At OneNorth office complex, I visited a fitness center that offers nothing but PT (personal training). Minimum membership is $1800/12 PT sessions. If you earn a decent salary nearby, then you would probably consider this package. Now, suppose most of your colleagues have signed up. They tell you various reasons. You accept some of those reasons, but ultimately unconvinced. Some may point at LKY’s attitude on casinoIR and remind me that “Time has changed”. I think I am not old-fashioned, and would consider to accept that package if the $cost/benefit ratio improves. At the current price level, the ratio can become acceptable if I perceive significant benefit in the package vs the alternatives.

  • alternative: You could try jogging on the street near office (unappealing to me). Re Wayne St…
  • alternative: You could do some simple workout in office, or at home. Re Wayne St.
  • alternative: You could join a regular gym somewhere farther out, for $100/M.

At the current ratio, I would say it’s really important to justSayNo. Even if I earn 20k/M, this salary is /unsustainable/ in X years so now I need to spend like ordinary locals and save. Their business model (designed for the super rich) is too costly for the nearby office professionals.

Yoga membership is comparable, but per-session price is about $15 (compared to $150/PT)

breakaway[def] from Upper-midClass #w1r2

Posted on by tiger40490

See also

Q: Why is it crucial for me to break away from the Chinese upper-middle-class mainstream in the U.S. ?
A: My asset and esp. combined salary is lower-middle-class. My carefree ezlife demands that I live well within (hopefully below) my means.
A: if I follow herd instinct, and surrender to that peer pressure,

  • my Melvin3 total burden would balloon to $7-8k, so my total burn rate could exceed 10k/M. I think this burn rate is top 2% of U.S. households.
  • I would lose my cash-flow high ground (brbr, Fuller wealth, FCF,,) My CPF + rental income + Beijing inheritance … all become 杯水車薪.
  • I would lose my steadfast focus on the long-term important/non-urgent goals of healthy longevity, career longevity, family harmony, ..
  • I would long for an additional USD 2M in net asset (endless greed). These Chinese middle-class families typically have a net asset of $1M+ but have a thin brbr. They don’t seem to live within their means.
  • I would be pressured to maintaining my salary and worry about job loss. I would envy those fake role models [interview rock stars, OC-effective guys, ]
  • Such a self-created baggage is simply too heavy. Something’s gotta give.

— t_breakAway tag is not about my own “unique or original” solutions.

It’s more about questioning,  challenging, rejecting and letting go of the Chinese middle-class immigrant mentality.

It’s related to t_mellow,

BDYK + fwd hazard rate #BGC/MIH

Posted on by tiger40490

For each overseas rEstate project, there are a few miletones, each with serious hazards/risks

  1. project completion .. Hazards can cause lengthy delays (BGC [1]). Some unreliable developer can disappear (RitzG5). MIH is a good example [2]
    • vicinity development can take decades. Until that vague “milestone”, your building might be the only decent building in the area. No jobs, no parks, no retail, no “buzz“
  2. renovation completion .. furnishing, fixing problems. Some units are “completed” but unusable.
  3. land title registered .. Risks? legal risks
  4. mtg approved .. Risks? poor mtg rate or no banks
  5. finding a local agent and negotating the terms .. hazard? Some locations have no agent at all.
  6. first tenant signed.. hazards? May not find anyone at all for years. Perhaps oversupply in the location. Perhaps the location doesn’t have the buzz of Uptown.
  7. Milesstone-9: 1Y probation completed with the agent .. Risks? Many owner-agent relationships don’t work out.
  8. ^^ One of these milestones may appear to be too trivial to be a milestone, but I have seen investors getting stuck at each of these things, always due to some serious hazard.

FHR [forward hazard rate] := the aggregate amount (count and magnitude) of potential derailers [swans, missteps] per year. Usually we ignore the per-year part [4]. In the beginning we face the highest hazard rate i.e. many things could fall on us or derail our train.  At each milestone, our total (forward) hazard rate improves, as uncertianties become well-known and familiar risks.

BDYK [Better the Devil You Know] is a key observation/experience in FHR.

[1] For example, the BGC asset has survived many hazards and is now a much safer asset than it was in 2015, therefore worth a BDYK-adjusted SGD 300k, even if we ignore (or don’t know) the market value changes.

[2] MIH — When I first paid down payment, FHR was huge and off-putting (show stopper to many investors) largely due to credit risk of an unknown developer. After completion, the biggest hazard was removed, and the asset is now worth a BDYK-adjusted USD 200k.

[4] When do we actually use per-year yardstick? In the stable phase. FHR in the per-year sense captures the amount of headaches, stress, derailers (of my bubble)

Does FHR ever worsen? Only in rare swan events like covid19. This exception proves the norm that FHR always improves until Milestone-9 or somewhere nearby.

— paradox of rEstate concentration risk
If you buy in 9 countries you are bound to hate one of them, often due to hazards. It’s then logical to exit that country and increase concentration in the best of those 9 countries.

On a less macro level, once you are familiar with a given country or developer, FHR would be better than X years ago (when you were unfamiliar). It’s now logical to increase concentration with (eg) MIH.

This “logical” allocation ought to be balanced with the (equally logical) need for diversification.

Look at U.S. or China rEstate investors. Most of them stay in home country. Zero diversification by country.

— positive cash flow -> self-sustainable i.e. the highest level of success.

Q: As of 2014, when we heard of SG investors flocking to an overseas “opportunity”, how many percent of them would reach Milestone-9 of positive cashflow with a reliable local rental agent?
A: Below 30%. Possibly 20%. It’s nearly impossible to achieve positive cashflow, if you have a mortgage with P+I. (Biggest problem is P).

Many investors would ask about my appreciation margin. For them self-sustainability is not the highest level of success. I don’t care about their priorities. I don’t even know the valuation, but I’m sure it’s better than my initial. What’s important to me is carefree and positive cashflow, not windfall appreciation.

— appreciation .. I feel after you can demonstrate that your unit has a proven rental yield, you can get a higher valuation than before completion.

This is logical, but many logical predictions don’t happen. I can list many reasons.

FHR has shown a real improvement. Many of the big question marks and big clouds are cleared.

— Overseas rEstate .. is the main focus of this blogpost. Local projects are much easier for investors.
==== Fwd Hazard Rate, without the “per-year” part, is also applicable beyond pff

immigration offenses and criminal record affects a career more in the earlier stage of a longer career. The FWR depends on the “remaining lease”.

FHR affects a marriage the most soon after babies are born and improves as kids become less dependent on the continuing marriage of their parents.

G9 SMS 2break away from brainwash #wage decline

Posted on by tiger40490

See also

I decided to group this blogpost with related blogposts, so as to have a single tag “t_breakaway”. Not purist, I prioritize cross-linking.

  • My wife always feels I look too thin for my health and appearance. I remind myself “I trust my BMI analysis — Based on years of self-monitoring, My BMI goal is well-founded. Many in my cohort would probably get better healthy longevity if they adopt similar BIM goals.”

Most of the other SMS messages are related to middle-class aspirations

  • Many of my peers seem to suggest my family deserves higher Burn Rate. I focus on livelihood and believe a BR equal to 80% of local median income is reasonable and adequate. By that standard, many of my peers spend way too much.
  • branded college .. Can I accept if my kids only get into community college or polytechnic? This mainstream brainwash is still hitting me hard
  • home size
  • school district
  • car ownership .. In the U.S., and even in SG, my peers take up car ownership for convenience, not livelihood.
  • career longevity is more important than salary growth; healthy longevity is more important than (long-term) financial security

— Decline in salary .. is another example of breakaway. In middle-age, as livelihood (esp. healthcare + edu) expenses /peak/, should I try to maintain/increase my salary? That’s the conventional brainwash .. remember insurance agents. In reality, the dev salary at age 20+ to 40 is way too high. Therefore, maintaining it is often unsustainable and extremely stressful. My breakaway view:

  • recognize the super-high salary in younger years. Squirrel away more than 2/3 of it and invest, similar to SG past reserves.
  • during the middle-age phase, the nest egg would provide for family livelihood
  • As a result, I don’t have to maintain my salary. I can aim lower, to match the 20-something developers. That salary range is still very comfortable by national standard, and strikes a realistic balance between effort [stress, risk] and reward.

home: pay4what’s important to my(!!peers’) family

Posted on by tiger40490
  • Opening Eg: Some people value high floor but I hate the long wait for elevator.
  • Opening Eg: some people like ethnic diversity. My wife and I prefer more Chinese
  • Eg: Some people value a huge backyard, but I worry about maintenance. If I buy such a home, I am likely to take on 300k additional burden for no particular benefit.
  • Eg: Some don’t mind 45 vs 60 minute commute. I do.
  • Eg: some people don’t mind driving to work every day. I do.

Some parents consider an above average (like 7) school district unacceptable. We may find it good enough. If I lack a backbone, follow the herd instinct and pick a top school district, and sacrifice commute and take on 300k additional burden, I am likely to regret it.

–Some price factor in Bayonne

  • close to light rail — not a key price factor
  • close to shopping — not a key factor, since people drive
  • more uptown and shorter commute — not a price factor at all
  • bed room count — not a key factor
  • side windows (very few in row house) — not a key factor
  • close to park — yes G10 factor. I think these are affluent districts. Better avoid buying those locations
  • condition and age — yes G3 factor

I see no reason to buy学区房 even if affordable #summary

Posted on by tiger40490

If I liquidate enough assets I could theoretically afford a $800k home in a top school district, but if I have that much spare cash I would rather deploy it elsewhere!

Fundamentally, I don’t perceive academic benchmark as important as other immigrants do. Today I will focus on middle/elementary school level, though much of what I discuss here applies to high school too.

  • Background — In U.S. individuals without excellent grades are given many more chances than in Asia (Jack He’s pointer.) but …
  • Evidence — In Asia or other continents many successful individuals don’t come from top colleges, or have excellent grades in high school; conversely, majority of good students are mediocre in their careers outside the academic domain. (Even in science and literary domains, not everyone was a top student at middle school level.)
  • Evidence — as discussed in my open blog, most top students in middle school fail to keep the lead in college. By international standardized tests, East Asian middle school students far outrun U.S. students, but years later, after leaving college, my U.S friends and colleagues don’t show any sign of weakness at all. Therefore, I believe there’s too much emphasis on middle-school level academic benchmarks.

Instead of benchmarks, my main criteria are a conducive learning environment and engagement. I don’t see evidence that most academically mediocre schools are inadequate in that regard.

I believe a large subset of these “average” schools provide a good environment, whereas some top schools may fall short.

Grades are not as important to me as other immigrant parents, but grades are still important as the main goal for a student. There are many options to improve my kids’ grades, listed in ##many options: avg学区 !=avg school #index None of them requires buying a coveted school district house. The most I would do is to rent there.