Reggie at the Financial Coconut interviewed Andy Schmidt, a former Siemens subsidiary CFO, about his unique Singapore experience.
Andy came to Singapore nearly 25 years ago to work and live with his family. Somewhere along the way, he decided to “FIRE” before returning to work.
Older financial bloggers like ourselves would be more familiar with Andy through his informative blog, Taking Care of My Own Business. More popularly known as Tacomob, he has been using his blog as his notebook because he cannot remember what he learned very well.
I find myself using my blog more and more in this way as well.
You can watch the full interview here:
I met up with Andy a couple of times.
I honestly never asked him about what he did in the past or how he was able to to stop working in Singapore. I simply assume that an Ang Mo like Andy would have his means somehow and that is less important. We have more important things to discuss such as investing, blogging and life most of the time.
You might not want to watch the whole interview but because its Andy, I took notes about what he has to say and you can view my notes here.
The Best Quotes from the Interview
On doing things with kids.
“We realize that anything that we do with the kids before 7 years old, they don’t remember.”
Being aware of the financial mindset shift is needed.
“Once I crossed over 50, I told myself it is not the time for further accumulation but more decumulation. We should spend right?”
On taking care of yourself financially.
“You cannot outsource financial literacy to anyone. You have to educate yourself because the only one who would take good care of your money is yourself.”
Why copying the investing strategy of others is challenging.
“You cannot copy anyone in investing because everyone has their own game, own risk tolerance.”
Money and happiness.
“If your expectations grow faster than your money, you will never be happy. You need to manage your lifestyle decisions, not waylaid by the marketing machine.”
Why not find an easier job?
“How do you find a job that is lighter in Singapore?”
Some stuff is not easy because they might be worth it.
“Hard decision, easy life. Easy decision, hard life.”
How Andy Ended Up in Singapore
Andy was originally from Germany and came to Singapore in 1997 because he was posted here. He worked for Siemens for 23 years.
- Finished only his ‘A’ levels without a university degree.
- His dad, who used to work for Siemens, advised Andy to take on a proper profession before embarking on a degree so Andy took on a 3-year apprenticeship.
- He married his Singaporean wife in Germany before they decided to come over to Singapore.
- He tried to learn Chinese upon learning that he needed to come to Singapore.
- He was the CFO of a subsidiary of Siemens.
- He stayed on for 23 years because he always had good mentors and superiors who saw potential in him (often when he didn’t see it).
- His skillset is portable, and he can go into various places in a conglomerate such as Siemens.
The Family and Financial Profile of Andy
- Married a Singaporean wife
- Has 3 children
- 50-60% of his portfolio is in a Singapore landed property.
- His investment portfolio is 1-2 million mainly in index funds.
- He considered his CPF to be part of his portfolio as a fixed income.
- His portfolio is shrinking at a run-rate of $50,000 to $80,000 a year. His spending went up overtime because kids grow up and needed more money and he prioritizes spending on experience as well.
- When he got his first paycheck, he went to his bank to set up a regular savings plan (RSP) in a unit trust.
- He never tried to time the market.
- He realized that his portfolio grew, and at 44 years old, it gave him options in life.
- He can reduce his expenses by quite a bit if he doesn’t succumb to lifestyle inflation.
- He felt that the portfolio’s capital appreciation and dividends could tide him over the next 10 years (but not into full retirement).
- He tried his hand at active investing mainly based around systematic momentum, trend-following. He never developed the guts to in with a bigger amount.
- He had to be truthful and admit to himself that his long-term portfolio did better than his trading portfolio.
- He is a frugalist at heart.
- When the family decided to buy a condo, they prudently chose a 3-bedder instead of a 4-bedder and not to maximize the loan they borrow.
- The philosophy that underpins that decision is they should keep the option open that one of the spouses can stay at home if needed.
“What is Your Biggest Regret in Your Corporate Career?”
Andy had the opportunity to interact with a few co-workers who retired from Siemens after a 30-40 year career.
He asked them this question and more often then not, they said not having spend enough time with their children.
“We are usually hustling when our children are around 5 to 15 years old.”
“Now that I retired at 60, my kids are 20-something years old. They don’t need me anymore.”
Andy doesn’t want to have this regret in life.
Secondly, Andy always wanted to live life by design.
“Typically, a lot of us has a very linear life. You have your learning years when you are younger. Then your earning years. Finally, your yearning for retirement. “
“Why can’t I redesign life by borrowing some years from my retirement and put them in my mid-life and see how that feels. If I am bored of that, I can still pivot back to another job.”
Andy had a conversation with his wife at 44 years old. “What do you want? What other materialistic needs do you have?”
“We have two cars, a house, and three healthy kids (5 to 12 years old), I have nothing else on my want list.”
So he decide to stop working because there isn’t a need to.
His Blog and Tacomob.
Andy’s blog was his reflections on the things he read. He would often forget what he read and found it a good idea to write it down so that he could better internalize it.
Andy explains what he learns from diving into trading:
“You make money not by buying but by selling. However, the selling part is 100% based on emotions. You can backtrack all sorts of systems to check whether they work, but you cannot backtrack your emotions. ”
Andy realized that he has to learn more about these cognitive shortcuts to make us function better.
He eventually realized that the rational decision is to stop trading because it was too taxing emotionally.
Andy finds that reading is extremely important, and his recommendation is a mixture of statistics and history (because we need to learn about the past).
Restarting his Earning Years in 2016
Andy admits that there are periods where you will feel bored.
When your kids go to school, what do you do with your free time? The novelty factor will eventually wear off.
Andy realise that his social circle has really shrunk in the time after he left work and felt that he need some time to build that back up.
He did about 40 different courses on Coursera.
In 2016, an ex-co-worker introduced him to Beekeeper, which is a Swiss startup the co-worker invested in. Andy can become a sales partner for Beekeeper by bringing the software to the demand in this region.
The job is demanding in that Andy has to take on numerous roles such as cold-calling, content creation.
He also invested in another start-up and help in certain parts of their business.
The idea is to see which one worked out.
Andy didn’t want to go back to a corporate job due to the downsides that he saw.
“9-to-5 in Singapore is always 9-to-9.”
He values the autonomy over his time, which he cannot get if he went back to a corporate job.
I invested in a diversified portfolio of exchange-traded funds (ETF) and stocks listed in the US, Hong Kong and London.
My preferred broker to trade and custodize my investments is Interactive Brokers. Interactive Brokers allow you to trade in the US, UK, Europe, Singapore, Hong Kong and many other markets. Options as well. There are no minimum monthly charges, very low forex fees for currency exchange, very low commissions for various markets.
To find out more visit Interactive Brokers today.
Join the Investment Moats Telegram channel here. I will share the materials, research, investment data, deals that I come across that enable me to run Investment Moats.
Do Like Me on Facebook. I share some tidbits that are not on the blog post there often. You can also choose to subscribe to my content via the email below.
I break down my resources according to these topics:
- Building Your Wealth Foundation – If you know and apply these simple financial concepts, your long term wealth should be pretty well managed. Find out what they are
- Active Investing – For active stock investors. My deeper thoughts from my stock investing experience
- Learning about REITs – My Free “Course” on REIT Investing for Beginners and Seasoned Investors
- Dividend Stock Tracker – Track all the common 4-10% yielding dividend stocks in SG
- Free Stock Portfolio Tracking Google Sheets that many love
- Retirement Planning, Financial Independence and Spending down money – My deep dive into how much you need to achieve these, and the different ways you can be financially free
- Providend – Where I used to work doing research. Fee-Only Advisory. No Commissions. Financial Independence Advisers and Retirement Specialists. No charge for the first meeting to understand how it works
- Havend – Where I currently work. We wish to deliver commission-based insurance advice in a better way.
The post Quitting a High Paying Job to Spend Time with His Kids for Ten Years – Andy Schmidt appeared first on Investment Moats.
