I do a 6-month audit of my ‘net-worth’ for many years now. These audits help me in accountability and also as a historical reference for my kids when I won’t be in my mortal body to guide them. This also gives them an idea of what I went through to create the corpus they’re using.
Making this public from this year onwards as I might lose physical copies of it, a digital copy is way better & am hoping my kids in future will prefer reading it in this format on some type of smart glasses that will be invented by then; than reading it on paper.
Everything below is for my kids and I am writing it only for them. Everyone else, please don’t consider it as investment advice. I am not a SEBI-registered investment advisor, please consult one of them if you need advice.
2024 Second Half:
Changes compared to 2023 Second Half (YoY)
Expenses: Decreased 6.9%
Income: Increased 56.5%
Savings: Increased 85.1%
Family inflation rate: Went deflationary
I am a DIY investor who loves to keep his portfolio as simple & as boring as possible. I divide my entire portfolio into ‘Risk Fund’ and ‘Safe Fund’.
What I consider Safe Fund?
FD
Cash
Gold (Most risky in this category)
Debt Funds
Arbitrage Fund
Savings Bank Account
Provident Fund (EPF/PPF)
What I consider Risk Fund?
Stocks
Crypto
Equity Mutual Funds
| Desired Allocation | Current Allocation | |
|---|---|---|
| Safe Fund | 30% | 40.7% |
| Risk Fund | 70% | 59.3% |
Now lets double click on each of these to dig deeper.
Safe Fund
| Desired Allocation | Current Allocation | |
|---|---|---|
| Cash + Debt Fund + EF | 5% | 27.2% |
| Provident Fund (PF), NPS | 5% | 9.6% |
| Gold | 20% | 3.9% |
- Already have my Emergency Fund (EF) stored in Savings Account, Liquid Funds.
- Doing some amount in PPFAS DAAF each month so that the EF doesn’t get devalued due to government’s fiat currency printing.
- Gold is currently about 50% physical and 50% in ETF & SGBs.
- Not buying SGBs anymore as no new tranches announced & not expecting them anytime soon.
- For PF & NPS, I mark it down to 0 to calculate my net worth as I don’t except to get both back.
- Under-counting net worth is never bad. If I get it back – well & good, if I don’t I won’t get super hurt/sad; as there is a high chance of government locked schemes to be seized directly or indirectly.
Risk Fund
| Desired Allocation | Current Allocation | |
|---|---|---|
| Mutual Funds | 50% | 40.9% |
| Direct Stocks | 10% | 6.4% |
| Crypto | 10% | 12% |
More about Mutual Funds:
| Desired Allocation | Current Allocation | |
|---|---|---|
| USA (Nasdaq 100) | 30% | 30.1% |
| Nifty 50 | 20% | 21.7% |
| Nifty Next 50 (M150) | 20% | 30.5% |
| 3 Active Funds | 30% | 17.7% |
- Nasdaq 100 – I mentioned that in USA as thats the index I currently own.
- M150 – I mentioned that with Nifty Next 50, as occasionally I buy Nifty Midcap 150 due to similar volatility of both index. But am consistent with Nifty Next 50 only. Also M150 looks expensive now.
- Capital Control – RBI’s refusal to increase overseas investment limit this year for mutual funds created significant issues in the geographic diversification of my portfolio.
- Probably will start by directly investing through a broker like Vested in US S&P 500 ETFs like VOO.
- Due to increased total fees of currency conversion etc. and increased compliance issues of declaring everything in multiple forms, got lazy & haven’t started yet.
- For now, reduced US allocation from 40% to 30% due to above points. May chance soon when I start with investing through US broker.
- In SIR Community, discussed with members & got to know – Approx 2-3% is overall fees to invest through Vested or INDmoney other than the ETF’s own expense ratio.
- And ClearTax apparently makes it easy to file all these foreign assets documents in ITR. Also Vested allows easy downloading of required docs & has partnership with ClearTax.
- Most of my crypto holding is Bitcoin, stored in my self-custody wallet & not on any exchange.
More details on SIR Community – Click here
Summary:
- 2nd half of 2024 has been amazing – Added 1 more income source.
- Family inflation rate went deflationary due to family shifting back to old home location where costs of stuffs are low.
- This rate will be very temporary as expenses related to food increased due to purchasing more organic stuffs instead of mass marketed products.
- Family’s net worth increased by 94.3% YoY i.e. compared to Dec 2023.
- So considering income rate & net worth increase – In both metrics we beat inflation.
- Strategy indices caught up in popularity, I consider them as active funds only.
- Dad was getting FOMO about strategy index funds but our mantra of maximum 30% active funds helped in neutralizing that.
- Craze for quant mutual fund schemes have significantly slowed down & people have moved on to Motilal’s funds.
- Dad is sticking with our simple & dumb portfolio. No major change.
- Portfolio’s all-time XIRR is 21.55%. Portfolio XIRR doesn’t include some equity, all crypto & physical gold as not held in Zerodha.
Your dad,
SIR
