I sold my condo in April 2018 to rent a room, so I could travel more. Click here for a recap on why on Earth I would do that.
Since then, I have kept a close watch on my nest egg.
Are you curious how my stock portfolio is performing compared to the real estate market?
Here are some numbers and transparency!
It has been 21 months since I sold my condo and invested my money into the stock market. I saved $20,000 CAD during this time, which is nothing close to my plan of saving $2000/month. However, my portfolio is now up $50,000 (including my savings) in this short time! But this is only a 18% increase.
1. I hired a financial advisor that charged a 1% fee. He made me a very conservative portfolio at 60 equity/40 bonds. All the gains pretty much went to the fees. So I really didn’t “make” money until 6 months ago when I started investing myself.
2. I didn’t invest more money during the market downturn in December 2018. Missing out on potential gains.
3. I didn’t save even close to what I have planned (Goal of $42,000 vs. Reality of $20,000). Missing out on the compounding effect of investing for a longer period.
If I invested properly, with a higher weighting in equity (90/10, which it’s what I am doing now), the stock market would’ve returned 27%! When I compared that to my condo, it is a similar appreciation! (This is the crazy Toronto market, according to my realtor)
That means, by selling my condo and renting my room, and investing in the stock market, it would have gained a SIMILAR amount of *”appreciation” in this period.
But of course, we don’t really calculate appreciation this way. We don’t really make money until we sell. And it depends on your asset allocation in comparison to the specific real estate purchased and timing. But you get the point!
*2018- S&P 500 Index was down 6.24% , 2019 – returns 28.88%, 2020 – so far returns 4.43%. Average 27%. Higher when dividends are reinvested. Source
Even though I didn’t make the same gains (18% vs 27%), (but would have if I stuck to my saving goal), investing in the stock market did allow me the freedom to have travelled TWENTY-TWO times in this period!
April/May 2018 – Bali for 3 weeks
May 2018 – Barbados for 3 days
June/July 2018 – Peru for 3 weeks
August/September – Nepal, Mount Everest Basecamp Hike
Oct 2018 – Swimming Holiday in Crete, Greece for one week
Oct 2018 – Chautauqua event, Financial Independence Retire Early week-long retreat in Greece
Oct – November 2018 – Mexico for a week of scuba diving and cenotes
November 2018 – Tony Robbins Unleash the Power Within Conference for 4 days
December 2018 – Maui, Hawaii for a week
I started this blog!
Janurary 2019 – Las Vegas for a weekend. Did the plane ride over Grand Canyon.
March 2019 – Ottawa for a weekend. WALKED, not skated, on the frozen Ottawa River.
April 2019 – Yosemite National Park Hike for 4 days
May/June 2019 – Vietnam for 2 weeks
June 2019 – Travel Con Boston
July 2019 – Vipasanna Meditation for 10 days
September 2019 – Summit of Greatness in Ohio for 4 days
October 2019 – Santorini holiday and swim holiday for a week
November 2019 – Rise business conference in Charleston, South Carolina for 4 days
November 2019 – Miami for 2 days
November 2019 – New York for 3 days
December 2019 – Norway for a week during Chirstmas/New Year (stayed with a local friend)
Jan/Feb 2020 – Chiang Mai for 3 weeks
Feb/March 2020 – Back to Bali for 2.5 weeks
March 2020 – San Francisco for 3 days
This post is to show you that investing in index funds gave me more flexibility in travelling. I might have not “gained” as much appreciation compared to real estate, (mainly because I messed up and went a bit crazy jet-setting the world), but the experiences I have accumulated in these two years were priceless! Hey, I travelled TWENTY-TWO times! I met all the cool people, did all the things! Most importantly, I have learned a lot about life and about myself.
I wasn’t stuck in my mortgage, and I had extra cash to use for travel/ increase my saving rate.
But this type of lifestyle is not for everyone.
However, if you also believe that life is too short, that it’s important to live life to the fullest, but feel responsbile to also take care of your future, share this article with someone you think will find it useful!