The Crew Portfolio: Alex Kempin
The Mastermind Behind the Investing 101 Course and Some of My Favourite Recent Reads!
Dear readers,
Today we have another case study of a yachtie that has done it right. I have been in touch with Alex since 2019 and he is also the creator of the Investing 101 Course that he has made available to readers of The Yachting Investor.
I have a lot of time for Alex and I especially commend him for not being a salty All Black that is used to coming second against the Springboks ;)
Before we dive in: our referral program is live. Please share!
Can you tell us a bit about your background in the yachting industry and how you first became interested in personal finance and investing?
I first joined the industry in 2017 in New Zealand, where I was living at the time, after realising I wasn’t keen on a traditional 9-5. I worked on one boat for about 4 years and then Covid hit so I took a break for a few years and pursued other interests. Recently I’ve decided I can see a future in the the Maritime Industry and took up a job on a 38m yacht in Australia.
As for personal finance, I’ve always been a good saver and inherently knew it was ‘good’ to get your money working for you, so as soon as I started earning those sweet dollar bills, I began researching.
What were some of the first steps you took to start managing your money while working on yachts?
The short answer - I started with investing into Index Funds/ETFs, maybe $50/$100 bucks a month.
The long answer - I dove headfirst into podcasts, YouTube and reading blogs nonstop. I basically taught myself everything because there wasn’t anyone in my circle to learn from, nor were there any yachtie specific resources. And once I felt confident enough, I started investing small amounts of money and as my knowledge and money grew, I began investing more.
You’ve successfully invested in both the stock market and real estate. Can you share what attracted you to each of these investment avenues?
The stock market has the smallest barrier to entry, you can easily sign up to an investment platform, transfer money and pick an investment. It’s also more liquid, meaning I can instantly sell stocks if I need the money. Of course, like anything, there are downsides which need to be considered.
Real estate, by far, comes out on top as far as using leverage goes. You can have a multi property portfolio starting with only one initial deposit using equity alone. You can do this with stocks but it’s for more experienced investors. I also like that real estate provides an income and is fairly bullet proof in that no matter what happens, people will always need a place to rent. The flip side of that is I can also ask my tenants to leave and I can live in my rental property if needed.
What were some of the biggest challenges you faced when you started investing, and how did you overcome them?
The biggest challenge by far was simply a lack of knowledge. Here are questions that ran through my head when I first started - where do I start, who do I talk to, who can I trust, what do I invest in, what if I lose money, what if I’m scammed, what about different currencies, what about tax, how much do I need to start, how much will I make, how often do I need to monitor it, what if the stock market crashes… etc etc, you get the idea!
Put simply, my doubts were progressively overcome by educating myself, and starting with small investments. I was ok with potentially losing $50 if I meant I learned something about investing.
How do you balance your investing with the unpredictable nature of working on a yacht? What tips do you have for crew members who want to stay financially disciplined?
Great question, I’ll break down a few financial tips below:
Always ensure you have an emergency fund, anywhere from 3-6 months living ashore expenses, not onboard
Automate your investing so as soon as you’re paid, a % gets sent to your investment account. In the event of no work and no income, just pause your auto investment
Avoid bad debt like cars, handbags etc, if you can’t buy it in cash, don’t buy it.
And the most simple of them all, spend less than you make and invest the rest.
Are there any specific financial habits or routines that have helped you stay consistent over the years?
Yes, I generally live my life by 4 financial pillars:
Avoid bad debt, as above. Good debt is generally considered to be property loans, education etc.
Invest wisely, index funds, rental properties, do your own research.
Spend consciously , don’t buy BS that you can’t afford, buy what you love and save on what you don’t.
Of course, spend less than you make.
These are all simple in practise but we are human after all! I’ve always been careful to not live on rice and beans, I still enjoy my life and spend money on things I know will add value.
What’s been your most successful investment so far, and why do you think it worked out so well?
Haha, well. To be honest, I made a good chunk of change investing in a chip stock, AMD. I allocated a percentage of my total investment pot and made an educated guess, and it paid off. Other investments haven’t panned out as well, so I’m certainly not advocating for high risk individual stock investing, but in this case it worked out.
Overall, my index funds have done very well over the years, and my properties are ticking up nicely as well, but I have a couple of poor investment picks in my stock portfolio that are weighing me down. You win some, you lose some, a balanced portfolio is your best bet over the longterm.
What’s one mistake or learning experience that shaped how you approach money management today?
I’ve always been good at managing my money, I’m not impulsive and tend to err on the side of frugal. I’ve always been a saver. But don’t get me wrong, I have made investing mistakes, ones that I am still dealing with. Not researching your investments and throwing money at a stock because you read a few articles about it, or your engineer said it was a sure bet, generally isn’t a good enough reason to invest.
Podcast: The Yachting Investor x Yachtie Real Estate Investor
Featured on Capt Scott Kidd’s pod a few weeks ago. Watch it here on Youtube!
For more links and resources, check out: TYI- Linktree
Do you follow any particular strategies when it comes to stock market investing or real estate?
Yep, an overarching strategy is key to becoming a successful investor.
For the stock market, I generally invest regularly into index funds, most of my portfolio is allocated to this. However, I do take a little bit of fun money and invest in individual companies that I believe in. My general allocation is 90% index funds, 10% individual stocks. Ignore the media noise, stick to your plan, invest early and regularly.
As for real estate, buying a high performing investment property takes a lot of work, which is why I use an agency that sources the properties for us. I don’t have the time or skills to locate high quality, off-market properties, so I pay the professionals. As an analogy, you wouldn’t want a Superyacht owner to drive their own boat, you’d hire a Captain.
For those just starting out, what resources (books, podcasts, courses) would you recommend to improve their financial literacy?
There are so many great resources:
I Will Teach You to Be Rich, book and podcast by Ramit Sethi
Everyone likes something different, but that should get you started.
You can complete my course and keep following Charl’s website and Newsletters.
If you could give one piece of advice to a yacht crew member who is just beginning their financial journey, what would it be?
Investing isn’t as hard as you think it is, educate yourself and start small.
What’s next for you in your financial journey? Do you have any new goals or investment areas you’re excited about?
Nothing groundbreaking, just keep on progressing with our investment property purchases; our goal is 2 per year for the next 5 years. Hopefully when you interview me again in 5 years, I’ll be close to an early retirement!
Buoy’s , Balance & Banter
From this week onward, I’ll be adding this segment to share what I’m reading, absorbing and having a laugh at. Lemme know if you enjoy it!
Good Read of the Week
📖 Article: James Clear’s 3-2-1
The author of Atomic Habits shares insights on the power of identity-based habits, emphasizing that consistent actions shape who we become.
Words to Live By
💡 Quote: “Never let the quest for more distract you from the beauty of enough.” Sahil Bloom
As a yacht crew member, I see abundance all around me. I wish I can see more smiles sometimes.
Just for Laughs
😂 Video: Wasabi Help
Don’t care how old I am, this is golden.
Have a great week everyone!