An Interview with Engineer My Freedom

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I recently had the pleasure of interviewing Derek the blogger behind the awesome blog Engineer My Freedom.

Derek is a relatively new blogger and his blog covers my favorite topic, dividend investing!  So I invited him to share his investing knowledge and experience with us.

Kanwal: Tell me a little bit about yourself and your blog.

Derek: My Name is Derek and I am from a small city called Waterford in the Republic of Ireland. I have two main passions which are personal finance and technology. Personal finance is a relatively new passion of mine (since the last financial crash) but I am also a sports nut, mainly soccer where I help coach my 2 kids in my spare time.  

You might have guessed it from the title of my blog, but I work as an automation engineer. I love my job as I get to program and play with robots 60% of the time. I might sound like a bit of a nerd but I have learned that it is far better to work in a job that I love than a job that I hate. Anyone who worked in a call center may be able to relate!

I was a bit of a late bloomer to the personal finance scene. During my early 20s I was not so frugal or clever with my money and it took till my third decade to start getting my finances in order. If you are interested, please free to read my story here.

My mindset started to change after the last financial crash and after a few years of trying to “get rich quick” I have finally stumbled across a style of investing that suit me.

I started my blog; I think in May 2019 but did not begin writing in it until January this year. My main goal of the blog was to document my thoughts throughout my investment journey and have a point of reference where I can learn from any mistakes I make.

I have made it a goal of mine to achieve financial freedom and this blog will hold me accountable until I’m able to chase the sun around the globe with my wife.

I really admire the FIRE community and think it is amazing that so many people are willing to help others and I just want to do my part as well. As an introvert by nature, writing and putting my point of view out where the world can see was a bit daunting but if I can help at least one person get started on their journey to financial freedom than writing the blog will be worth it.

Kanwal: What is your approach to investing?

Derek: I have been investing for nearly 3 years now and consider myself very much in the infant years. Since I have started writing the blog, I have met some amazing people who have helped trigger my thought process and how I go about selecting companies to invest in. 

One constant that remains however, is that I like to invest in high quality dividend paying stocks that based on my selection process are likely to not only continue to pay dividends in the future but to also grow them far above the rate of inflation.

Kanwal: Why do you feel your approach is the best?

Derek: My overarching goal is to cover all my expenses from passive income. I believe that dividend investing is the best method to achieve my goal. Investing in ETF’s is a sensible choice for most people but I have wrote a post here as to why there is no place for ETF’s in my portfolio. Maybe one day if Ireland change some of their laws with respect to ETFs I will add them but for now my main focus is on income producing assets like dividends and property.

However I soon released from family and friends that there are people out there who in the same position I was 3 years ago. I feel that if I can help at least one person get started on their journey to financial freedom than writing the blog will be worth it.

Kanwal: What advice do you have for someone just starting to invest?

Derek: My main piece of advice would be to just start investing. The sooner you put your money to work FOR you then the stronger the powers of compounding will work.

Read as many books and blogs as you can and don’t be afraid to reach out to ask for some guidance. While most are not allowed by law to offer financial advice, I found that most people are happy to point you in the right direction to help you make your own investment decisions.

Also write down your goals. What are you investing for? How much do you want? When do you need it? This will help you stay on track when the excitement wares off. Trust me, dividend investing is not exciting, but that is why I love it.

If you are investing monthly than do not be afraid to make a mistake or two. Keep a journal of everything and let dollar cost averaging do the rest for you. If you are investing a large lump some in one go, I would certainly seek financial advice.

In Summary, Read, Question and Practice.  Rinse and repeat and within a few years you will be a confident and knowledgeable investor.

Kanwal: Any stocks that look interesting to you right now and why.

Derek: We are certainly living in strange times with Covid-19 so I am feeling a little conservative with respect to what the future might hold. For that reason I am not investing as aggressively as I was in March. With that being said one company that I have my eye on this month is Aflac (NYSE: $AFL).

What’s not to like about this dividend aristocrat. At current prices, the dividend yield stands just over 3% where they are paying $1.12 per year. The have also just recently increased the dividend by 3.7%, which was welcomed in my portfolio, especially when other companies are cutting at this time. A super low payout ratio of 26% is also a good sign that they can continue to raise their dividend for a few more years yet.

Kanwal: Thank you Derek for taking the time to share your investing knowledge and wisdom!

Learn more about Derek and his blog by visiting Engineer My Freedom.

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2 comments

Jason McDermott Jun 11, 2020 11:29pm

I'm also from Ireland and found this helpful and encouraging. I will definitely be reaching out to Derek. Investing is not widely encouraged or learned among ordinary people here in Ireland. Investment vehicles and platforms until the likes of Trading 212 and Degiro were non existent. A handful of banks and building societies offer pension plans that put your money in Mutual and ETF (with manager fees of course), plus one or other type of investment product offered by banks here I won't bother to explain but for those interested to research it's called a tracker bond and isn't very popular this article explains why https://www.independent.ie/business/personal-finance/charlie-weston-run-a-mile-if-the-bank-is-trying-to-sell-you-a-tracker-bond-35038378.html

Derek is right about ETF and tax laws here, they are so unfair, I wouldn't want to cry conspiracy but the it's like the Government here don't want the little guy getting ahead. We are so heavily taxed here also. Would you believe there are 3-4 types of taxes to be paid on income and capital gains here! It's outrageous. The tax laws do need to change, but again not enough ordinary Irish invest and therefore aware to write to their local politician and demand changes.

P.s 

Govt bonds are also terrible value for money here, one benefit of using them would be at the tail end of your investing and to move all or a large chunk of your capital in to one for a good 5 -10 years towards retirement of which you can withdraw as a tax free lump sum into your bank account. Something I'm considering doing when in my autumn and winter years with my own investment/savings plan.

 

Love your youtube channel Kanwal and will be subscribing to your Dividend report soon. I'm just at the starting stages of my investment journey myself. I've a pie of assets in the making, stocks are next on my list and you've been so helpful in helping me strategise, cheers.

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Thanks Jason for your comments and kind words. Step one to getting started is learning about investing. I'm glad sites like Derek's are also helping people to learn about the importance of dividend investing.

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