New investment strategy
Hello guys!
I've been thinking about my asset portfolio lately. I'm working my ass off to pay the remaining part of my mortgage as soon as possible. And I'm starting to wonder what should be the next steps in my journey to financial independence and retirement early (FIRE).
On one hand I would like to buy another apartment and rent it to pay the mortgage. On the other hand I would not like to deal with all the issues that you have when you have a rental property. I hate all of this stuff, a lot.
As you know cryptocurrencies are going to be a % of my portfolio, so this is not at question here. As I would like to diversify the 2 main options for me are:
1- Buying a rental property with the goal of having a breakeven investment. I just want to pay the mortgage and all the other costs. This investment goal is not to generate additional cashflow.
2- Buying monthly a S&P index fund and keep stacking.
For those of you who don't know what is a S&P index fund, here you have a quick explanation (it's not mine):
An S&P 500 index fund is a type of investment fund that seeks to replicate the performance of a specific index, in this case, the S&P 500. The S&P 500 is a market capitalization-weighted index that includes the 500 largest companies in the United States. The main characteristic of an index fund is that it invests in the same stocks that make up the index, in the same proportion.
This means that the fund is not actively managed by a portfolio manager but instead automatically follows market movements.
One of the key benefits of investing in an S&P 500 index fund is that it provides exposure to a broad set of companies within a single fund.
So I finally decided to invest into the Fidelity S&P 500 Index Fund P-ACC-EUR. The part of the name with "ACC" is referring that all the dividends are automatically reinvested into the fund. And the part with "EUR" obviously is because it's in Euros.
I will try to be consistent with this investment as I want it to be a long term investment. I'm commited to add monthly a fixed quantity of Euros.
I will be using the DCA (Dollar Cost Averaging) strategy.I will share with you some details about the progess.Have a great day!
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Welcome to the club! 😅
🙂
Do you have another property in addition of your house for rental purposes?
What are your thoughts over an index fund of the S&P?
Yes, besides real state I have Indexed funds (MSCI World and Emegents), other ETFs, and also a stock DGI portfolio... I am fully invested 😂...and, of course BITCOIN
Congrats! 🔥
Now this is all personal deccission, but if you have the option for another morgage, I would go with real estate, becouse as I see it, it is basicly a long term short position on the curency, eur in your case, and those just keep going down ... after five years you will probably be in a range of 20% to 50% lower real debt since inflation is eating it away...
That's exactly what I think. I think I will be able to do both at the same time once I'm able to finish the current mortgage. Thanks for your feedback!
Rentals are such a pain, I’d go S&P too. Stacking euros monthly seems easy and DCA’s a no brainer so that's good. Let us know how it works out man
The possible issues with the rental property are a pain in the ass.
I will be trying S&P for now. Have a great weekend!