Over the last few months I have been making an effort to clean up my finances. In many cases I am dealing with things that should have been dealt with a very long time ago. In all cases, the procrastination has ended up costing me money - not just the loss on the investments or expense concerned but the opportunity cost of not having the money available to invest in other things.
House keeping so far:
1. I have cancelled my term life insurance policy which reduces my annual expenses by the amount of the premium. If I have enough money to support the family in retirement, by definition there is enough to support the family without me;
2. I have closed an old investment account in New Zealand. Not much money, but it will pay for a couple of nice dinners with my parents on our next visit. Also, one less institution cluttering up my mail box with statements;
3. I have sold four "too small" investments: Sino Oil & Gas, Shenzhen Express, HOGS and NICK. The first two started out at the minimum threshold but fell below it (in Sino Oil's case, well below). All were sold at losses;
4. I have cancelled a fire insurance policy which I hope is no longer required.
House keeping still outstanding:
5. I have two small speculative positions remaining: platinum (notional not an ETP so no contango issue) and Paladin (ASX: PDN) which is essentially a play on uranium. I am currently holding a small loss on both of them. I have no problem with making a few small speculative investments but have learnt that taking losses early and not having too many going at once is probably a better strategy than my recent practice of just ignoring the losses and hoping things will improve. In any case, I need to decide what to do with these;
6. I have two other investments which are now in the "too small" category. Tontine Wines HKSE: 389) and a single carpark space in Auckland. I have not decided what to do with either of these yet;
7. I need to update my will;
8. I need to update the list of accounts etc for Mrs Traineeinvestor should anything happen to me;
9. I would like to sell a few of the (cheap) paintings in our home so we can refresh with new ones;
10. Mrs Traineeinvestor has some investments of her own which we should discuss.
Loss making investments:
As I was writing this, I noted that I have said on all of the recently realised losses that individually none of them is large. However, collectively, the losses are material. This really reinforces the need to limit the number of speculative investments and to manage them better. Given that I will soon cease to earn an income from employment, this discipline is now more important than previously.
I also took a look at my other investments - happily only three are currently trading at below cost: China VTM (HK: 893), Xtep (HK: 1368) and Vietnam Tracker (HK: 3087). China VTM will more or less break even if the proposed general offer eventually goes through. Xtep is generally rated a sell by brokers but is still well cashed up, generating positive cash flow and paying a good dividend. Vietnam Tracker is exposure to a counrty with excellent demographics and a lot of catching up to do in terms of evolving into a developed economy.
Everything else is currently profitable (although BHP and Sinolink are at about break even), so the non-property investments as a whole have done very well but that does not excuse a failure to deal with my mistakes promptly.
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