The past month has been flying by like crazy. The plans for the wedding are really taking shape and I’ve, completely unexpected, bought a wedding dress. With ‘only’ 9 months to go, the coming month we will be deciding on the invitations and flowers (Pinterest really became my friend in this).
But the even bigger news here is that we have bought a rental property!
Oh yes, and of course we are receiving dividends as well. Still collecting without even lifting a finger. Talking about the power of passive income here.
Did you know June officially is the first month of the summer? On the 21st of June, we’ve had the first summer day of this year. It was on a Friday, and it couldn’t be a better start. Because the next day, we had our second BE & NL FIRE meet-up in Utrecht. We had wonderful talks and discussions and all in all had a great time. The third meeting is already being set up, and we’re making plans to grow the FIRE community throughout the Netherlands and Belgium.
My look on FIRE has been changing lately, partly due to influences of others. It isn’t only about the numbers and waiting to reach a certain goal, but about radically changing your life so you have the power to fulfill your dreams as early as possible. FIRE to me is more about creating the time and opportunities to do so. But the numbers are equally fun while being in the building phase, and I get a lot of motivation from tracking my own results and seeing progress made by others. Our goal is to build up one or more passive income streams through investing in dividend growth stocks, and hopefully, we can add real estate to that list pretty soon as well.
With every month ending, I like to disclose what our progress is. How our investments played out, and what our further plans will be. Partly to be fully open in order to be accountable, and partly because I hope to show others some inspiration, ideas or just another mindset. Let’s get to it.
This past week we’ve been to a seminar of Kevin Green on real estate, and I (Mrs. Divnomics) went to a Meet-Up for real estate investors. There were some people we knew who also went to both, and we’ve already getting to know quite some people because of it.
I was hoping that both topics had information that would be a bit similar, and I was right. Two key topics that were covered on both were these:
1. How can I find a good property deal?
2. How can I find the money to fund buying a property?
Both of these questions are very important to get some answers to when you want to invest in real estate. For now, we only focus on the first question.
Since we have been starting looking into real estate, we’ve been eager to get as much knowledge on it as we could. So when the opportunity presented itself to go to a seminar on real estate investing by Kevin Green, we knew we had to go. And oh yes, they were VIP tickets. Free of charge… We definitely couldn’t say no to that.
This seminar was last weekend, and we had high expectations of it. Although Green is an authority in his field, he didn’t quite live up to those expectations. Still, we had learned a few things along the way and met with some interesting people again. I hoped to get out a detailed post about all the nice gems we had acquired last Saturday. But it turned out to be a little different. Instead, it got me thinking about why it’s so important not to just believe everything you hear, but keep a mindset of asking a question and try to understand it.
A few weeks ago a question about value and price that Mr. Divnomics had in one of his classes set off an interesting discussion. We talked about this subject and questioned ourselves if value and price were actually the same things. Or are based on different kinds of fundamentals. The outcome of that class was that price and value were the same things, which we both disagreed on. His teacher loved the discussion going forward and had planned a new discussion on the next class with some upfront preparation.
In order to get some more thoughts and opinions on this topic, I wrote a blog post on our thoughts of the matter. And there were great replies that made us think about our view towards value and price.
Last weekend the second class took place, and another discussion with the group got to a very interesting conclusion.
Another month in the books. Only one left to go and we’re already halfway through this year! We’ve made some new steps in our real estate venture and our monthly dividend has never been this high before. Partially because of a very unexpected special dividend we have gotten. Always nice to earn some extra without lifting a finger. All in all, it was a great month.
After the deception of last months results, things couldn’t have gone better this time around. We’ve received the late dividends of Munich RE and got a surprise extra dividend from BESI. Resulting in our best month ever!
Some of the grandmasters in investing have always taught us that the price and value of an asset are 2 fundamentally different things. Value is something that can be calculated, for example with the Discounted Cashflow Model (DCM), and the price is based on supply and demand.
This is also what we use to determine our investments. Whether a stock is undervalued or not, and is fundamentally sound. And moreover, if the value would be higher than the price being paid for it.
But there are also other theories, which state that the value is equal to price. Like when the value of an asset is based on the price that others are willing to pay. Or as Oskar Morgenstern says it:
“A thing is only worth what someone else will pay for it.”
What’s the deal on this?
Well, it happened, for the first time ever our dividend hasn’t grown year over year. And to put it blankly, it actually decreased a lot. But, we haven’t lost anything. The biggest chunk of our ‘normal’ April payments will now be paid in May. Therefore our results for this month a quite a bit skewered.
I promise, that this hole will be filled though. Big Time. Because on the other part, we managed to get an amazing additional income for this month. Our savings have been flooded by something we had been waiting for, for over 6 months now….