For I say there is no other thing that is worse than the sea for breaking a man, even though he may be a very strong one.

Homer, The Odyssey, Book 8

This is my one hundred and fifteenth 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 $3,250,000. This should be capable of producing an annual income from total portfolio returns of about $112,000 (in 2026 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 $2,600,000.

Portfolio summary

Vanguard Lifestrategy High Growth Fund	$1,020,192
Vanguard Lifestrategy Growth Fund	$50,793
Vanguard Lifestrategy Balanced Fund	$86,408
Vanguard Diversified Bonds Fund	$92,856
Vanguard Australian Shares ETF (VAS)	$670,009
Vanguard International Shares ETF (VGS)	$1,130,147
Betashares Australia 200 ETF (A200)	$343,341
Gold ETF (GOLD.ASX)	$257,823
Bitcoin	$961,985
Plenti Capital Notes	$84,000
Financial portfolio value (excluding Bitcoin)	$3,735,569 (+$55,028)
Total portfolio value	$4,697,554 (-$125,692)

Asset allocation

Australian shares	30.1%
Global shares	33.9%
Emerging market shares	1.2%
International small companies	1.4%
Total international shares	36.5%
Total shares	66.6% (-13.4%)
Australian bonds	2.8%
International bonds	3.8%
Total bonds	6.6% (+1.6%)
Gold	5.5%
Bitcoin	20.5%
Gold and alternatives	26.0% (+11.0%)

Presented visually, the pie chart below is a high-level view of the current asset allocation of the full portfolio.

Comments

This month saw a sharp a fall in the headline portfolio, of around $126,000, or around 2.6 per cent.

This was entirely due to a sharp correction in the price of Bitcoin, which fell by 16 per cent across the month.

The underlying financial portfolio, however, expanded, growing 1.5 per cent, or $55,000, to reach a new highest value of $3.7 million.

The chart below sets out the performance of both the full and ‘financial assets only’ portfolios since the commencement of the journey.

The strongest contribution to financial portfolio growth was a small positive movement in global equities (of around 3 per cent), reinforced by a marginal increase in Australian shares (of 0.6 per cent) over the last month.

By contrast, gold continued its falls since January, with the value of holdings falling a further 8.0 per cent, despite continued accumulation by developing and emerging economy central banks.

Over the month, bond holdings made a small gain of 0.9 per cent.

The month, as previously, small additional new investments were made in global equities (through the Vanguard exchange traded fund VGS), in accordance with the decision to regularly reinvest excess distributions and cash holdings.

Breaking storm? Early trends in second quarter distributions

Prior to the finalisation of this update, the three major exchange traded fund announced provisional distributions.

This permits an early glimpse of some of the portfolio income record, which will be added to and reported more comprehensively across the weeks to come.

The Vanguard Global Shares ETF looks set to produce distributions of around $5600 for the quarter. This is about 10 per cent below the median payout, and in fact is the lowest absolute level of per unit payout for six years.

The Australian shares ETFs – being VAS and A200 – also generally delivered modest payouts, in case of VAS around 10 per cent below their median levels.

These lower than average results means that overall, distributions may not reach the $37,000 that past distributions records might suggest, but rather perhaps fall closer to around $34,000.

The caveat on this overall quarterly estimate is significant, however, as the final result will depend on payouts from the three Vanguard retail funds.

The distributions patterns of the largest of these, the Vanguard High Growth Fund, is on average mildly negatively correlated to that of the ETFs.

This means that the overall distributions in the second quarter are still difficult to predict at a portfolio level, with more positive results possible. While this may be the case, my assessment is that this is unlikely, based on the more recent patterns of lower payouts from this fund.

Combined, these lower than anticipated payouts would translate to portfolio distributions of around $58,000 for the first six months of 2026, and portfolio income of around $93,000 for the full 2025-26 financial year. This figure almost exactly corresponds to expected median income on an annual basis, based on past distributions.

Trends in average distribution, portfolio income and expense measures

Every month I track evolving trends across average distributions, notional portfolio income and total expenses, with the analysis below focusing on the financial portfolio only, consistent with previous updates.

The chart below primarily measures distributions against an estimate of total expenses.

The total expenses figure (set out in the red line) is based on actual credit card spending, with the addition of a regularly updated notional monthly allowance for other large fixed expenses.

The chart also has a series of ‘safe’ portfolio income. This is marked in green and is calculated as the product of the financial portfolio (i.e. excluding Bitcoin) and the selected safe withdrawal rate of 3.45 per cent.

This value can be viewed as the notional ‘safe withdrawal income’ currently provided by financial assets in the portfolio. It is estimated on a three-month moving average basis.

This month average total expenses fell slightly to around $9,000 per month. Total estimated annual expenses remains steady at around $109,000.

Using the most recent estimates of the three year moving average of distributions (the blue line), paid out distributions have continued their recent rise to reach just over $8,000 per month.

This leaves the monthly deficit between total expenses and average distributions continuing to narrow to about $1,000.

Using the newer ‘SWR portfolio income’ measure, however, portfolio income remained steady at just above $10,400 per month. This is around $1,400 per month higher than total expenses, meaning a maintenance of a consistently positive ‘safety margin’.

Progress

Measure	Progress
Portfolio objective – $3,250,000	145%
Financial portfolio income as % of total average expenses (3 yr average) – $108,900 pa	118%
Target equity holding in portfolio – $2,600,000	120%
Financial portfolio income as % of target income – $112,000 pa	115%

Summary

This month closes out a full year on revised working arrangements, involving a tighter focus on projects that interest me, rather than the fuller set of previous responsibilities. It has been, in a way, an experiment in living at a different pace, and growing used to the expanded opportunities it provides to focus on my own personal interests and goals.

Even as this occurs, however, significant markers of portfolio development still make themselves felt, as one looks back in time at how the portfolio is different now than previously.

One is the resilience and continued growth of the financial portfolio.

This is currently at the highest level it has reached. Within that, equities have passed the milestone of $3.0 million in stand-alone value, within the broader portfolio.

Similarly, the full financial portfolio, when added together with superannuation holdings, has passed a valuation milestone of $5.0 million for the first time on the journey.

In a way, these facts are unsurprising, as the historical record would suggest that an equity-dominated portfolio will typically spend significant periods at or close to all times high, as a function of the long-term positive returns across most developed equity markets.

Hidden in this is a little trap, or rather, a cause for some reflection.

This is that the measure used counts, and when assessed in nominal dollars, especially in a period of higher inflation, this measure can appear flattering, compared to real after-inflation measures.

As a simple illustration of this fact, at the current CPI or inflation rate of around 4.0 per cent, a portfolio consisting of $5.0 million will need to appreciate around $200,000 per year, or $17,000 month merely to retain its purchasing power in real terms. An investor could easily, for example, observe monthly returns of $15,000 and with some complacency, imagine that this represented a real gain, where in fact what was occurring was a slow steady erosion of real purchasing power.

This month, that benchmark was met. In fact, normal variance in equity returns will mean that it is more likely to be sharply exceeded, or fallen short of, than met reliably.

Yet it is there, the insistent beat of inflation, as steady a force upon real wealth as are relentless waves upon a shore, or a man. And just as able to break them through time.

Note for readers

Over the last year, there has been a noticeable degradation in the useability of my standard blogging interface. As an alternative, and because I am not interested in becoming a coder, plug-in or website management expert, I have created a backup Substack and imported past posts. The formatting of past posts may not be as tidy as here, but should the blog ever seem to ‘disappear’ or cease, it will likely just be a signal that I have switched entirely to Substack and started posting there.

Also, if you are reading this article on a website called “Geldmountain”, please be aware that this and other updates have been reproduced without any contact or permission. Please feel free to view the original site, and subscribe if you wish, here.

Disclaimer

The specific portfolio allocation and approach described has been determined solely based on my personal circumstances, objectives, assessments and risk tolerances. It is not personal financial advice, or recommendation to invest in any particular investment product, security or asset, and investors considering these issues should undertake their own detailed research or seek professional advice.