Wow! One year sure does go by quickly. I can’t believe it’s been a full year since I officially “semi-retired”.
For those of you new to this site, and my blogs, you can find more details regarding my business sale here. I also wrote a blog about my first 150 days post “semi-retirement” check-in, and you can find those details here.
I put the words “semi-retired” in quotations. I still have a problem with the term, and I’ve struggled with what to say to people when they ask what I do. More often than not, I settle on consulting or real estate investing, or some variation of the two, especially if I don’t want to have a long conversation about what it means to be semi-retired.
The six months since my last check-in have proven to be interesting for me on a number of fronts. I’ve broken this blog into three categories to make it easier to read. 1. Work, 2. investments, and 3. miscellaneous personal stuff.
I have a few paying clients that take up about 8 to 10 hours a week of my time. With the state of Toronto traffic, I seem to spend more time traveling to and from downtown Toronto to the client sites, then I do in actual meetings. I try to take the train and subway whenever I can to avoid driving in gridlock traffic.
Rush hour seems to start earlier and end later than it ever did, which is no surprise considering the city of Toronto is expanding by something like 130,000 net new people a year. They’re not building homes and apartments, and definitely not expanding the roads and highways, quickly enough to keep up with demand. As a result, home prices are higher than ever, the apartment vacancy rate is at a record all-time low, and the traffic seems to get worse year after year. Needless to say, I try to avoid being on the roads whenever possible.
I launched my book, The Kickass Entrepreneur’s Guide to Investing, in late May, and by mid-June and into July and August, the book vacillated in the top few spots on Amazon.com and was actually the top business and non-fiction book on Amazon for many weeks this past summer. My email list grew quite quickly into the many thousands, and I now receive emails daily from people from all over the world asking me business or real estate related questions.
My apartment buildings, all in Toronto, are operating at peak capacity. In fact, I believe that we might actually have a 100% occupancy rate for the 2018 year, which is outstanding but not surprising, considering the state of the Toronto real estate market (as per my comments above). It seems that the CAP rates have stabilized at the incredibly low rate of the low 3s. I keep thinking that the market will turn in favor of the buyer, but the craziness continues. That might change soon with the rising interest rates.
I started building my personal brand on my website, The Kickass Entrepreneur, and my intention when I started was to do 2 to 3 blog posts a week. I was planning on doing videos and a podcast. I recorded some videos and was planning on launching a business series, when I came to the realization before my family vacation this past August that I was too busy, doing too many things, and putting too much pressure on myself to build another business.
I took a step back and reflected on what I wanted, not only from life but from business and work, and decided that I needed to slow down on my personal brand. I’ve since cut back on the number of blogs and have gone from two a week down to one, and I decided not to release the videos or podcast¬—yet anyway—and while the number of new subscribers has slowed as a result, I’m good with that. You can read more about that here.
Since August, I’m now operating at a more reasonable pace with less pressure than I was prior, but that could change shortly, as I have just gotten involved with the Creative Destruction Labs, and have just agreed to mentor a young startup tech business. My first call is tomorrow with the entrepreneur (Thursday, Dec. 20th).
My traditional investment philosophy of investing my assets into three buckets—real estate, cash, and equities—is quite askew at the moment. The equity portion of my portfolio has traditionally been my own business, and I have historically reinvested my cash back into either acquiring competitors or reinvesting into strategic growth. Now that I have sold my business, I am heavily weighted in cash and investment real estate.
Over the course of the last year, I have bought several ETFs and blue-chip dividend-paying stocks, however, I have resisted diving further into equities, as I feel the stock market is in the late cycle. Almost all of the blue-chip stocks that I own pay a dividend yield averaging between 3 to 5%, with some as high as 7%. Also, the dividend income is taxed more favorably than interest income, so I’ve tended not to hold bonds or bond funds (plus, with the rising interest environment, bonds just don’t make as much sense).
I am holding a much higher percentage of cash at the moment, as I am waiting for better buying opportunities to arise over the course of the next two years, and I want to be ready to take advantage of those opportunities when they do. It’s not a question of if they will arise, it’s a question of when, and with the recent volatility in the markets, the buying opportunities will arise shortly. Remember the Warren Buffet saying, “be fearful when others are greedy, and greedy when others are fearful.” The markets are now driven by panic selling, and the recent sentiment has been to sell the strength on the odd days that it happens, and not to buy the dips. Your buy opportunity will happen, now’s not the time.
Whatever happens with the stock market though, my investment allocation and targeted rate of return on the cash is to maintain a relatively conservative portfolio that earns anywhere from 1.5 to 2X the risk-free rate of return, which at the moment, is approximately 2.5%. So, my targeted return rate on the cash and equity portion of my portfolio is anywhere from 4 to 5%. I don’t need to take a significant risk with my portfolio, especially since the income from my investment real estate more than covers my living expenses.
Last month I spent some time looking into the multi-unit-residential real estate markets in Toronto and South Florida. I figured if I found the right property, with upside potential in the rents and a building in a good neighborhood, it might make sense to acquire another building. I spoke with a few real estate agents and have ultimately decided to wait … The numbers just don’t make sense. So I am now holding a lot of short and medium-term fixed income with laddered one- to five-year maturity, generally earning on average between 2.75% to 3.6%.
I would like to invest into another few businesses over the next couple of years. Although I am not rushing to make an investment, I am looking for the right business, in a growing sector, with healthy EBITDA margins, where I can add value as a consultant.
Miscellaneous Personal Stuff
My wife and I moved our daughter to a university in the Maritimes in September, and now both my kids are out of the house and in school out of town. Although I expect them to come back often, and definitely spend summers at home, the house is now eerily quiet.
My son is off to Singapore on a five-month exchange to a business school there this January, and my wife and I are planning to visit him this coming winter 2019. We’re also hoping to spend some time in South Florida away from the cold Canadian winter weather.
One of the things I enjoy most about not having to work on a defined Monday to Friday schedule is the extra time I’ve found in my schedule to go to the gym. Prior to December 2017, I went to the gym two, maybe three, times a week. Post-January 2018, I try to go to the gym at least 6 times a week. I do 30-minutes of cardio, and 30 to 40 minutes of weights, plus my time at the gym gives me an opportunity to listen to my various podcasts.
As an FYI, here are the top five podcasts I am currently listening to:
I would like to thank all of my readers for sticking with me, especially those who have reached out to me personally by email. I am looking forward to helping you scale your businesses, build wealth, and achieve your own levels of business success and financial independence. Good luck with your businesses into 2019, and I hope you have an amazing new year. If you want to connect with me, feel free to send me an email: jeff at jeffwiener.com.
This will be my last post until early January 2019. I will be back to regular programming on January 7th, 2019. Until then, happy holidays, and a new year.
My goal is to help entrepreneurs scale their business, improve profits, and, ultimately, create wealth. I post two blog posts a week. You can subscribe here.
Want to know more about me and read some of the other interesting small business growth, profit and wealth stories I’ve written.
Here’s an interesting post I wrote: The Top 2 Mistakes I Made When I Started My Business. That Was a Long Time Ago, and Entrepreneurs Are Still Making the Same Mistakes Today
Here’s one of the first articles I wrote: My Journey Post Business Sale as I Sail Into a New Harbour.
Are you a younger entrepreneur? Here’s another interesting article I wrote:
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