The grey tide and the sullen coast,
The menace of the urgent hour,
The single island, like a tower
Dorothy L Sayers
This is my one hundred and sixth monthly portfolio update. I complete this regular update to check progress against my goal.
Portfolio goal
My objective is to maintain a portfolio of at least $3,000,000. This should be capable of producing an annual income from total portfolio returns of about $103,500 (in 2025 dollars).
This portfolio objective is based on an assumed safe withdrawal rate of 3.45 per cent.
A secondary focus will be maintaining the minimum equity target of $2,400,000.
Portfolio summary
| Vanguard Lifestrategy High Growth Fund | $971,730 |
| Vanguard Lifestrategy Growth Fund | $49,066 |
| Vanguard Lifestrategy Balanced Fund | $84,845 |
| Vanguard Diversified Bonds Fund | $94,343 |
| Vanguard Australian Shares ETF (VAS) | $679,755 |
| Vanguard International Shares ETF (VGS) | $932,001 |
| Betashares Australia 200 ETF (A200) | $346,555 |
| Telstra shares (TLS) | $2,569 |
| Insurance Australia Group shares (IAG) | $10,345 |
| NIB Holdings shares (NHF) | $8,892 |
| Gold ETF (GOLD.ASX) | $261,613 |
| Bitcoin | $1,919,923 |
| Plenti Capital Notes | $84,000 |
| Financial portfolio value (excluding Bitcoin) | |
| Total portfolio value | $5,445,637 (+$125,870) |
Asset allocation
| Australian shares | 26.4% |
| Global shares | 25.2% |
| Emerging market shares | 1.0% |
| International small companies | 1.2% |
| Total international shares | 27.4% |
| Total shares | 53.8% (-26.2%) |
| Australian bonds | 2.9% |
| International bonds | 3.2% |
| Total bonds | 6.1% (+1.1%) |
| Gold | 4.8% |
| Bitcoin | 35.3% |
| Gold and alternatives | 40.1% (+25.1%) |
Presented visually, the pie chart below is a high-level view of the current asset allocation of the full portfolio.
Comments
This month the portfolio expanded strongly, growing 2.4 per cent, or around $126,000.
The one key driver of this was a remarkably sharp increase in the value of gold holdings, which increased by 12 per cent over the course of the month.
The underlying financial portfolio also expanded registering its sixth consecutive month of positive growth, to reach just over $3.5 million.
The chart below sets out the performance of both the full and ‘financial assets only’ portfolios since the commencement of the journey.
Australian equities incurred small falls through the month, with negative returns of around 1 per cent. By contrast, unhedged international equities performed better, with a capital gain of just over 1.4 per cent.
The continued outstanding performance of gold coincided with some falls in US interest rates, and increased buying from global central banks, who are steadily rebuilding their gold reserves. This has made it the strongest performing ‘traditional’ financial asset class over the past five years in the portfolio, on a total returns basis. What is playing out in gold markets is in some ways a once in a generation change in valuation, returning to real inflation-adjusted prices last experienced in the late 1970s.
Bonds continued to eke out some modest gains, with a return of around 0.6 per cent this month. Over the past two years, portfolio bond holdings have been recovering, with a return of 6 per cent each year, after earlier steep capital losses.
This month a further investment in the Vanguard global shares ETF (VGS) was made, in accordance with my previously discussed plans to gradually reinvest excess distributions and cash across the next 16 months.
The other major activity has been the rearrangement of the placement of the one year of cash reserves set aside as part of the financial independence ‘pre-conditions’ for ceasing any paid employment. After some negative changes to bonus interest conditions to Ubank’s savings accounts, these have been moved to a simpler product from another bank provider.
Parallel rules: reviewing the record of taxable investment income from 2007
This month I collated annual tax return information for the last financial year for my tax agent and submitted it.
This tax return data provides an alternate series and perspective through which to view the progress towards financial independence. Over time, I have used this as a form of loose ‘cross-check’ on other data, such as the regularly updated portfolio income record.
Continue reading “Monthly Portfolio Update – September 2025”