Wealth Building Strategy: Captain FI’s Cocktail of Passive Index Funds, Websites and Property

captain fi

Thanks to Captain FI for this week’s wealth building strategy: A cocktail of Passive Index investing, websites and property.

Each week, I have asked a finance blogger or podcaster to share their personal wealth building strategies. I am hoping these will be useful to compare lots of different strategies and perspectives to provide ideas and insight in your own investing journey.

Captain FI is a young pilot in Sydney who through scholarships and incredible dedication managed to get through extremely expensive pilot training without getting into debt! He is working towards financial independence, and runs the Captain FI blog and podcast.

Pilots are high income professionals, also prone to lifestyle inflation, similar to medical professionals. Captain FI has bucked the trend and has achieved so much. Even the sky’s not the limit for this young pilot!

Website: www.captainfi.com

“9 to 5” profession: pilot 

Side Hustles:

Investing, website business, tutoring, flipping, matched betting 

What are your investing goals?

Fat Australia FI $6000 per month 

What is your investing time frame?  How far along are you?

I Want to reach FI by 30. Currently 29…. pretty close – About half way to my goal but business is accelerating that 

What the most powerful wealth building tool available to you?

Living cheaply, high wage, Website business income

What wealth building habits are you utilising to reach your goals?

Regular investment, DIY and gratitude 

What is your strategy to achieve this?

Investing my wage into Index funds, websites and property 

How long have you been using this strategy?

Index funds, 3 years, websites 1 year

Were there other strategies before?  If so, what made you pivot?

Initially, all money went to pilot training, then I tried property and managed funds, stock picking and finally settled on where I am at now 

What makes your strategy suit your personal situation?

I don’t have a lot of free time so value passive income 

Where do you stand on home ownership vs renting?  Why?

Rent because it’s cheaper.

Buying investment properties for long term capital growth and rental cash flow.

Only buy PPOR (principal place of residence aka own home) when you need the family stability 

Where do you stand on the great property vs shares debate? Why?

Interest rates are so low, so I personally buy shares rather than pay down a mortgage.

The power of cash on cash returns due to leverage is great too, so I am trying to max my serviceability out on investment properties on interest-only loans. Any surplus cash goes into index funds 

Where do you stand on investing for capital growth vs income?  Why?

Income is needed to FIRE, capital growth is somewhat more tax effective and this compounds faster, but ultimately you will need to either switch capital growth into income assets and pay a capital gains tax event, OR slowly sell down parcels for income.

Capital growth sell down strategy exposes you to risk of a market crash especially damaging early in retirement, so realistically I think building a baseline income of income assets (which won’t be as sensitive to market swings) to cover basic cost of living, and then concentrate on growth which you can sell down if favourable circumstances.

So both. This is what I’m doing 

Do you have any financial regrets?

Not investing sooner, being dumb picking stocks, spending far too much on my flying training 

Any final suggestions?

Track your expenses! 

To see all the Australia FI wealth-building strategies shared with Aussie doc freedom, check out the Ultimate Step by Step guide to Wealth building, with wealth-building strategies.

Aussie Doc Freedom is not a financial adviser and does need offer any advise.  Information on this website is purely a description of my experiences and learning.  Please check with your independent financial adviser or accountant before making any changes.

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