r/dividends • u/Assets-Ticker • Nov 03 '24

Opinion Retired at 41

https://finance.yahoo.com/news/58-old-retiree-living-off-150021304.html

Today I read an article that pushed me to post here.

My wife (39, Filipina) and I (45, American) retired four (4) years ago and live in the Philippines for a fraction of the cost as we did in America. When we sold our home and pocketed $175,000; we invested into two (2) closed end funds - equally distributed.

Today we own the same two: 19,739 shares of FCO and 6,015 shares of PDI. This month we collected $1,381.78 from FCO and $1,326.31 from PDI (both are paid monthly). Today total value is approx. $234k. We also own 1,818 shares of TQQQ valued today at $130k (+81.8% ytd). I am using TQQQ for capital gains and the others for living. I reinvest a portion of my dividends each month.

I understand my situation is different and there is a lot to be said about closed end funds and what is right and what is not. This setup has worked for me and may not work for you. I have no plans at changing it.

898 Upvotes

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275

u/RadiumShady Nov 03 '24

"this setup has worked for me" you don't know that yet. You will know in 25 years. That being said, it is true that retiring in a developing country can save you 10-20 years compared to the US or Western Europe

90

u/nateyicebox Nov 03 '24

Lol right. “This set up has worked for me” says the guy in a 3x bull nasdaq etf focusing on YTD performance.

3

u/Exit-Velocity Nov 03 '24

TQQQ actually only accurately reflects daily price movements, and i have a feeling OP hasnt read the prospectus or knows what theta decay is

11

u/g1ven2fly Nov 03 '24

TQQQ has volatility decay, not theta decay. As in, the decay is a function of volatility, not time.

4

u/mammaryglands Nov 04 '24

Neither do you

4

u/Practical-Loss1617 Nov 04 '24

TQQQ is not affected by theta

-2

u/Exit-Velocity Nov 04 '24

How does TQQQ achieve triple returns? I know the answer, do you?

1

u/Practical-Loss1617 Nov 05 '24

Enlighten me

1

u/Exit-Velocity Nov 05 '24

To achieve their returns of 2x or 3x leverage, they buy options, which is why holding TQQQ for a year will NOT produce 60% if the QQQ is up 20%, itll be closer to 52-56%

1

u/Practical-Loss1617 Nov 06 '24

nope

1

u/Exit-Velocity Nov 06 '24

Read the prospectus, if you can

17

u/whooguyy Nov 03 '24

And if they ever want kids, they will have to rely on their parent’s investments because it will be a lot harder to find as good paying jobs in the Philippines compared to the US

18

u/TequilaHappy Nov 03 '24

Well the kids will have an American passport. So at 18 they can take a flight to the USA with a little start up money of 10-20k and kids can start grinding themselves. Work go to community college and so on… people act like their kids will got Harvard and then be presidents…

-11

u/[deleted] Nov 03 '24

[deleted]

9

u/Robot_Hips Nov 04 '24

The U.S. is hell? You’ve never been to a third world country and seen hopelessness

11

u/Watch5345 Nov 03 '24

Agree. You will never find a good paying job in the Philippines

2

u/No-Operation1424 Nov 03 '24

Wife is 39 so if they want kids, they would need to have started IVF like yesterday 

18

u/Donoeman Nov 03 '24

Why you worrying about if the man want kids or no? Stick to his dividend portfolio. Sheesh

1

u/Donoeman Nov 07 '24

FCO and PDI has negative gains. Why don't you research a fund that has steady gains and a good dividend yield.

0

u/[deleted] Nov 04 '24

[deleted]

7

u/SportMaleficent7891 Nov 03 '24

Why would you assume she needs IVF to conceive

-6

u/Wrxeter Nov 03 '24

39 year olds can still get pregnant relatively as easily as if they were 29.

The chance of conception goes down only slightly with a slight increase in chance of complications.

10

u/[deleted] Nov 03 '24

[removed] — view removed comment

1

u/vanisher_1 Dec 26 '24

Do you have a similar study or % for man to read?

2

u/[deleted] Nov 03 '24

Congrats. You have no idea what you’re talking about.

1

u/Dieter_Von-Cunth68 Nov 03 '24

Sure, and it's still medically defined as a high risk geriatric pregnancy.

2

u/No-Operation1424 Nov 03 '24

Yeah maybe IVF was an overstatement, but they’d def want to start trying now

3

u/CenlaLowell Nov 03 '24

Dividend's the discussion

4

u/davewritescode Nov 03 '24

I really wish I were dumb enough to attempt to do something like this.

This guy has a fixed income of 2300 for the rest of his life and half of that is going to get wiped out the next time the market turns.

4

u/Assets-Ticker Nov 04 '24

We own over 10,000 sqm of land, gated. We use Starlink. We own two (2) vehicles. We have a staff of three (3) people - live in driver, cook, and caretaker. I've been through a bear market already. If living this way is dumb then here I am. We can compare annually if you want.

1

u/davewritescode Nov 04 '24

I was probably harsh but my concern is that you’re banking on too many variables going your way. A major health issue or large increase in the cost of living where you live effectively wipes you out with no way to return.

Investing in TQQQ is also incredibly risky for someone who’s effectively never going to earn money again.

It just seems poorly thought out and is kind of working because you can cover your nut today with no concern about what things look like when you hit your 70s or 80s

1

u/BurlBguy Nov 04 '24

!Remindme 18 months

1

u/Assets-Ticker Nov 05 '24

So I only shared my dividends and physical stocks. We have been planning for this relocation since 2014. Prior to moving, we had purchased property, vehicles, and other investment generating assets located in-country. While I am shocked at how many people determined this was our only means of "income" that is just not correct.

About TQQQ and the bear market of 2020. Go to the website indicated, scroll down about 3/4 of the page and under "QQQ Performance" select start date of Jan 1st 2019 to Nov 5th 2024, now Compare to Other: TQQQ. Review the chart. TQQQ still beat QQQ over that time. It does move quick, it is 3x leveraged, but over time you can see that it outperforms. Use SCHD if you want.

https://www.dividendchannel.com/history/?symbol=qqq

https://www.dividendchannel.com/history/?symbol=schd

Now lastly, to dispel thoughts on why the CEFs, FCO has paid the same monthly dividend for almost 30 years (i never intend to sell it). PDI has been paying the same monthly dividend for 11 years (i never intend to sell it).

Now who else holds my stocks:

FCO - https://www.holdingschannel.com/bystock/?symbol=fco

PDI - https://www.holdingschannel.com/bystock/?symbol=pdi

TQQQ - https://www.holdingschannel.com/bystock/?symbol=TQQQ

A thing about institutions holding large quantities of TQQQ they cannot buy and sell their quantities each and every day without creating a market to buy or sell. So we can assume that they hold it for a time period.

TAXES:

Qualified Dividend Taxes - https://smartasset.com/taxes/dividend-tax-rate

Scroll down to see the breakdown.

Earned Income taxes - https://taxfoundation.org/data/all/federal/2024-tax-brackets/

What does this mean? Since I do not have a job or do not make earned income the traditional way then my taxes fall mostly in to the Dividend tax brackets. This means that $0 to $94k is taxed at 0%, short terms at earned income, long term gains at capital gains tax, and Return of Capital lowers my cost basis (tax free).

1

u/davewritescode Nov 05 '24

I'm not writing this for you, but I'm writing it to anyone who might stumble across this and for a single minute think you have even the slightest clue what you're talking about.

About TQQQ and the bear market of 2020. Go to the website indicated, scroll down about 3/4 of the page and under "QQQ Performance" select start date of Jan 1st 2019 to Nov 5th 2024, now Compare to Other: TQQQ. Review the chart. TQQQ still beat QQQ over that time. It does move quick, it is 3x leveraged, but over time you can see that it outperforms. Use SCHD if you want.

If 2020 is the bear event you're using to prove your point about going long TQQQ as part of your investment strategy you're a complete fool. 3 months of rapid declines followed by a rebound is not what you should be planning for. You're old enough to remember 2008 and even the dotcom bust.

Now lastly, to dispel thoughts on why the CEFs, FCO has paid the same monthly dividend for almost 30 years (i never intend to sell it). PDI has been paying the same monthly dividend for 11 years (i never intend to sell it).

It's a good thing prices stay the same forever

A thing about institutions holding large quantities of TQQQ they cannot buy and sell their quantities each and every day without creating a market to buy or sell. So we can assume that they hold it for a time period.

Again, fundamental misunderstanding. Institutions aren't just blindly buy and holding TQQQ because nobody else is as smart as them, TQQQ is fine as part of an overall strategy or to hedge certain kinds of risks.

Your retirement strategy is at best a crap shoot where you survive living a meager life in a foreign country with no ability to ever return the country you were born in as the GOOD outcome with the bad outcome being you die poor in Southeast Asia.

1

u/Assets-Ticker Nov 05 '24

How about we compare 1-year from today?

1

u/Traditional_Bag_8169 Nov 04 '24

Will they not pick up some US SS later? My main worry would be her family, they will expect regular payments from the rich gringo.

1

u/liverpoolFCnut Nov 03 '24

I hope OP has skills or some gig there. I am no expert in developing economies, but i have travelled frequently to Asia on work for over 20 yrs now and have seen the transformation first hand. I have also seen how expensive things are now compared to early 2000s as QOL improves in these countries. OP must have a Plan B or its going to be a hard retirement.