Friday, December 02, 2022

More details on why I ditched my carefree life to practice law


When I wrote my last article, I thought it was a casual personal update. People who study law and get admitted to the bar eventually become lawyers. I've also had plenty of time to plan for my career transition. 

Interestingly, the last article attracted a lot of attention.

Investment Moats Kyith was the first to contact me through Whatsapp. He was wondering why I was urgently making a career switch. It should be noted that no one is as obsessed with the "safe rate of withdrawal" as Kyith in the financial blogosphere, so I suspected that he thinks my finances have become wobbly.

15-Hour Workweek went even further with a hilarious but scarily accurate breakdown of my financial situation.  You can read it here. 15WW is mostly correct, but he "see me too up" and overestimated my wealth. Rising interest rates do affect dividend portfolios negatively, and I took my fair share of poor performance, although it's nowhere near the folks who dabbled in tech, China and crypto. 

I just want to add some perspectives on why I transitioned into law 7 years after leaving my IT career.

a) I mentally divide my assets into "earned" and "inherited" wealth

I'm very public about inheriting money, but spending it leaves a bad taste in my mouth, so I segregate my assets. Even dividends from the inherited bucket go back to it. As a consequence of that, Imagine my "earned" bucket as being barely enough to sustain my family expenses. I can't objectively live on 4% of that, and I can barely live on 6% of it, but it motivates me to start an investment course and engage with the world, so I refused to break these silos down. 

The consequence is that I feel hungry and deprived all the time, but if we account for the inherited bucket, I would not need to get up in the morning, and my family can go to Japan three or four times a year.

Still, the inherited bucket is useful. It is helpful for medical emergencies, and I will be generous regarding children's tertiary education. My dad kept emphasizing giving me an education in his will, so I will carry out his wishes in spirit for his grandkids. 

Do note that my SRS, Mortgage and CPF voluntary contributions, which I have been so aggressively pursuing lately, come from my "earned" bucket, so you can imagine how deprived my life really is given how poor my business revenues are. 

I'm very transparent about this approach, but I don't recommend that readers do this. My mum thinks I go hungry when I go to work and shoves me a few bucks when we eat together. 

b) I learned that FI can induce boredom, and you become jaded after a while

As I've stated before, Financial independence is a networked good. If there get there early, congratulations, but your friends may take another 20 years to reach your stage. Not all of them can travel with you then. 

I'm fine being the only person who is financially free, but recently, as a result of growing old, I've lost interest in everything I used to like. When I was younger, I could anticipate a new RPG or game and could hang out at Comics Mart to talk about my hobbies. Now by the time anything arrives in a Singapore store, I reviewed it in PDF format and can even sell it to noobs at the game shop.  I've also closed my mind to newer games, they always seem sort of derivative of an older Euro game, and there are textbooks on game mechanics that deconstruct everything. 

And these days, all I do is deconstruct everything.

Lately, I've begun to feel the same way about books. The assertion of management books is rarely backed by empirical data, so I've grown to disdain it. Some authors just back their ideas with long-winded stories which are entertaining but ultimately one data point. Philosophy repeats the ideas of dead white men and feels like subjecting the reader to a painful cultural vasectomy. Investment books are still ok if they are self-serving, but I can't just subsist on investment books.

I need variety too. 

Legal practice, on top of my investment training program, is one way I can take theoretical ideas and solve practical problems with them and see the real consequences. If I can pick my pace of work, there's a chance I might even enjoy it.

c) Timing issues with my CFA qualification

I passed level 3 of my CFA in 2003, and then I just carried on as an IT professional. Years later, after I determined that I should start an investment training business, I figured that running my training program full-time could allow me to earn this qualification that has eluded me for nearly two decades. After getting a sizeable portfolio, I realised that to have an investment career, I was often prevented from investing on my own account by company policy.

So the clock started ticking for me to get my CFA in 2017, and I just got it about two months ago. So I'm really only free to pursue my legal career recently. 

d) I don't want to corrupt my kids

In my entire life, I've only been retired for six months. That was in 2014 when I awaited my acceptance into law school. Beyond that, I've been studying, doing a training contract, and running an investment course.

I don't want my kids to imprint on the idea that a dad is just a retiree. In fact, my kids need to understand why they will end up side-hustling and having multi-hyphenated careers.

Seeing a dad chillax every day might corrupt them. Even if I can make them FI on their first day at work, imagine how much I would have robbed them if they lacked the motivation to earn accomplishments in their lives. 

e) People have lost their Financial Independence in this downturn

Times are bad; we went from a pandemic to a war in Ukraine, a breakdown in supply chains, and multiple crypto meltdowns to a hawkish Fed. I know folks who have lost their FI of late, and it's unpleasant to get back to the workforce without bargaining power. 

Imagine updating your resume, and there is nothing to write about. 

I've experienced discomfort this week. I returned to fighting the morning crowd and fought off sleep after taking too many carbs on lunch break. 

It's uncomfortable, and you don't ever want to do this because you need the cash, so better do this while you don't need the money.

Lastly, students and readers are inquiring about my new vocation. I've spent the week getting to speed and may refrain from business development activities for now. I still need to process the rules on touting for lawyers, so if you have an issue you need help with, write to me at my normal email 

Will share more when I get my name card.

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