Serenity now: Beachman's financial plan

How I constructed and execute my personal finance and early retirement plan

I first wrote about my overall financial plan in May 2022. We were just done with the Q1 earnings season and investors started realizing that interest rate hikes were changing the macro landscape and forward fortunes of companies we owned. The SP 500 had already fallen 14% YTD and was threatening to go lower. Panic and fear started setting in quickly.

Last weekend and again this weekend I noticed a similar, significant increase in fear, uncertainty and doubt (FUD) on several online investing forums and on social media. SIVB, Signature and Silvergate bank collapses, more regional banks in trouble?, Credit Suisse backstop efforts, surge in usage of the Fed’s discount window to shore up liquidity, recession coming? deep or shallow recession? disinflation or stagflation? is QE back on?, is QT done?, end of banking as we know it?, crypto going to the moon?, riots on the street?, are we on the precipice of a major market crash?

A sign of the times - people are worried about their futures, their portfolios and looking for answers and information.

And I will be honest, I was a little worried too, both last year and now. However, every time, concerns start creeping up in my mind, I go back to my financial plan construct and peace sets back in.

My financial plan always gives me…Serenity now!

About four years ago, I found myself giving my 29-year old cousin some financial advice. He asked me several basic questions on how to save, invest etc. Below, is what I shared with him then.

P.S. I recently asked him about that conversation and he still has the little sticky note with the diagram in his wallet. He is now engaged, soon to be married and well on his way to putting many of these elements in place for his own financial security.

Beachman’s financial plan

I have been managing my personal finances since the age of 24. I learned from my father, a few good books, some of my more experienced friends and a constant urge to read, listen and watch informative, educative financial management content. There is a lot of good, free content out there and there certainly is a bunch of crap too. The challenge is finding the nuggets and avoiding the not-so-good stuff.

My graduate MBA degree as well as decades in business strategy, product engineering and new markets development helped improve my understanding at both micro and macro levels.

I think about my personal finances in terms of the diagram depicted below.

Beachmans financial plan 2023

Each part of this diagram is important in its own way. It is strongly advised to establish the outer and the lower layers first before taking on a higher layer in the pyramid. This ensures that one has a strong base upon which to build, learn and manage risk.

Many people will skip the foundational elements in the thirst (FOMO) for juicy investing returns. This erodes their ability to handle volatility when it hits their portfolio and they lose sleep at night, they make hasty erroneous choices and may even lose interest and hope. I, too, have made some of these mistakes in my early investing days and lost several thousands of $ making ill-informed decisions. It left me disappointed in myself and I lost interest in taking an active role in my investment for many years. Today, I rue not only those faulty investments, but also the loss of compounding returns if I had not walked away from investing in disgust.

My life goals have always centered around keeping my family safe, healthy and happy, building enough wealth to fund my family’s current and future goals, ensuring our ability to weather a financial storm, if it hits us and creating a financial and legal structure that will continue to serve my family when I die.

Some of the key elements in my financial plan depicted above:

  • I track our family finances using Quicken. It creates weekly/monthly habits of logging income and expenses, tracking bills and payments, setting up and sticking to budgets. All these actions result in a deeper, accurate awareness of our financial situation at all times
  • Investing in your health is self-explanatory…staying active, working out, eating healthy. Actions that one takes at a younger age will pay dividends later in life as the years take their toll on our bodies
  • Setting up a living will is easy these days. Establishing an estate trust costs a little in legal fees, but tremendously simplifies the process and reduces the cost to your heirs when you pass away. Do it for your loved ones
  • Apart from home and automobile insurance, we have a whole life insurance policy that covers me and a term life insurance policy covering my wife
  • We have about 3-5 years worth of annual expenses sitting in a savings account that we can dip into if the markets go to the crapper. This is the best sleep-soundly medicine for an early-retiree like me
  • Our real estate holdings include a home in the midwest U.S. and an apartment in Puerto Rico. Both these homes were bought when the real estate market in those locations were depressed. Our mortgage rates are fixed and reasonable
  • Throughout our careers, we saved and invested, often and a lot. Our base savings target was always 25% of our income. Some years it was higher and some years it was lower. But socking away 25% of our income every year resulted in a steady growth of our investment portfolio that enabled my early retirement at the age of 50
  • I love the F.I.R.E (financially independent retire early) movement and learned much from their teachings. We never embraced all of their concepts to the extent that they preach, but we found a good balance between living a good life (travel, entertainment etc.) and saving as much as we could all the time
  • About 85-95% of our investments are in long term, high conviction holdings. This allows me to invest the remaining 5-15% of our portfolio in more risky, potentially-higher return stuff such as emerging tech companies, crypto, short term trades etc


So that’s Beachman’s financial plan in a nutshell.

As I mentioned above, each portion of this plan has a role to plan in my family’s financial future. Other than the top of the pyramid (riskier investments), nothing should be skipped or ignored.

If you are just starting out on this journey, at first glance, it might seem overwhelming…too many things to get in place….so many financial habits to inculcate. I did not do all of this at once. It took many years to establish this plan and its various elements.

So take it one step at a time, figure out your life goals and priorities and make an investment in your family’s future.



@ Beachman

About 85-95% of our investments are in long term, high conviction holdings.

Care to share some examples of what these are?


I am not Bachman - but these are mine
Vanguard’s S&P500 index, Vanguard’s High Yield Bonds (very different from any other High Yield fund I know of), Vanguard PrimeCap and Vanguard Wellington.


AAPL and NVDA are two of the best examples of LT high conviction holdings in my portfolio. I discuss why in this post here: Bear's Mid-March Update - #11 by BeachMan2115

I also have Vanguard index mutual funds along a 70% US and 30% international split. I use low cost index funds for this tax free mutual fund account.


@BeachMan2115 - Thanks for the response. You and I do think alike on some things. AAPL just makes my Top 5 holdings, holding the 5th spot. I do own NVDA too, but it is a really tiny stake. I did own a lot more NVDA about 2 years ago,


For people with index funds it is important to know about duplication. For example, many people owning the S&P500 would not expect to learn over 5% of its value/holding is in AAPL.

How is that an example of duplication? That’s an example of capitalization weighting versus equal weighting.

An example of duplication might be if you own both an S&P500 fund and a Total Market Index fund.

1 Like

Sorry I was not clear.

Diversification is basic tenant of most investment programs. Very few people put all of their equity in a single company - even a diversified company like BRK. Although the numbers very - it is not uncommon to see people say diversify in X stocks - where X is rarely a number under 20 for a balanced equity section.

The point I was addressing is if someone wants to limit single stock risk to 5%, Apple as a part of the S&P itself exceeds 5%. In fact today, Apple is 7.2% of the S&P. Since Apple has had an excellent return over the last 20 years, people who want a “kicker” to the S&P might say I will add/switch another couple percent of my equity to Apple. Today that would be getting close to a 10% investment in a single stock.


I am not sure I understand what you are saying here. I agree that there will be some duplication across holding index funds and some individual stock positions. Perhaps you can clarify. Thanks

OK here is a specific example. Back in the 1990s there was a decent sized group of folks following/worshiping the investment ideas of James Bogle – they called themselves BogleHeads. Among other things this group felt is was important not to have more than a few percent of one’s portfolio in a single stock. If that number was 5% (and some folks preached lower numbers), strict enforcement today would preclude putting all one’s equity into S&P500. (I am not sure any part of the S&P 500 was 5% back then – maybe GE during Welch’s reign).

All I am saying is if a person does not look into ETF and mutual fund holding - at least the top 10 or so holdings it is easy to have more single stock risk. The very name S&P500 implies spreading the single stock risk across lots of individual holdings.

Because Apple in recent years has done so well it is a signifiant holding in funds seeking growth, funds seeking tech, funds seeking stable dividends, etc.

Duplication is not good or bad. Ignorance of unintended/undesirable duplication is another matter - something that increases a certain type of risk.

Some people will say so what? Within the last 30 days we have seen what the impact of a bank putting a disproportionate about of deposits into 5 and 10 year US Government bonds can do. That type of bond bet by banks, pensions and insurance company worked unexpectedly well from about 1983 until early in 2022 - lots of security and price appreciation. For SVB bank in March of 2023 - not so well.


Hi @BeachMan2115,

Here is a spreadsheet of a “portfolio” of 70% S&P500 plus a few stocks, 5% AAPL, 5% MSFT, 5% AMZN and 15% in other stock.


The S&P has large portions of the top 3, so your portfolio actually has the middle column invested in those 3 companies:

Does that help you?

All holdings and some statistics on my Fool profile page (Click Expand)


Hi guys what are your thoughts on SCHD.
SCHD dividend adjusted seems to beat SPY, QQQE and VTI over last 10 years

For reasons I don’t understand, dividend stocks are not doing well this year.

Hi @bjurasz,

Rates on bonds are increasing.

Since the dividend payout is generally the same with some increases, the yields were too low (vs “safe” bonds) so the share price drops which increases the yield.

Risk of capital loss is higher with stock vs bonds like treasuries so when the yield narrows, some people move to bonds.

Does that help you?

All holdings and some statistics on my Fool profile page (Click Expand)


Hi Big

SCHD is very highly rated by Morningstar…5 stars. I like the quality of their holdings and their low expense ratio. They are ranked #1 against their peer dividend ETFs. Lots to like.

That said, I personally would prefer holding 2-3 of their best stocks instead of the ETF itself. E.g. Verizon looks compelling. That way, I can benefit from both the dividend as well as share price appreciation. Of course higher concentration risk with this approach. But that’s my preference.

Hope you are well


Hi Beach,
Thanks I am doing well and hope you are too.
Love to read your substack articles.
Specifically on SCHD I am looking at a SWAN (sleep well at night) investment for the large proceeds I got from a house sale, I would payoff my other mortgage but since it is at 3%, I am thinking I rather put it in SCHD and get 3% dividends and even if I get SPY returns of 5-6% average over next two decades, it should work out well.
Right now I have it in one month tbills at 4.4% and plan to gradually DCA 10% monthly into SCHD.