Are You Wealthy or Just Stressed?

We often judge our investing success by a single number: Total Return. But as we know, wealth is multi-dimensional. A portfolio that doubles in value but costs you your marriage or your mental health is a bad investment.

How do we ensure that our system serves us, and not us serving our system?

Check 1

Is our portfolio growing over time? 

Forget the daily or monthly fluctuations, or your PnL statements even. 

Simply check if your portfolio is growing in value, if you are accumulating more and more shares over the years. 

If the answer is "No", you might be over trading or picking too many speculations that died down. Our dividend farm should grow slowly, quietly and inevitably.

Check 2

Is your cash flow higher and higher?

This is my favorite metric because it is harder to fake. Prices are opinions, while dividends are facts.

Did your dividend income grow? Are you reinvesting enough to compound that growth?

Even if our portfolio value is flat or down for the year, you are winning if your dividend income is up. You are still getting a raise on your passive income even while the world panics. That is the ultimate confirmation of our dividend investing strategy.

Check 3

Is your mood, sleep and relationships affected by your stocks portfolio?

This check is very important too. Do you find yourself checking stock prices at 2AM or feeling irritable just because the market is down 1%? 

Your cost of investing is too high, regardless of the potential financial return. 

Money is meant to be a tool for freedom. If you are serving your portfolio in this manner, then money owns you and not the other way around. Your current investing strategy may be unsuitable for you, and you will need to reflect and review on what better ways to allocate money so that you can sleep well at night.

"Wealth is the ability to fully experience life."

— Henry David Thoreau