For those who don't know what to buy with NISA. How a 37-year-old who ditched 40 individual stocks arrived at 'All Country only' | Defensive Side FIRE Diary ⑤

“I started NISA, but I don't know what to buy in the end.”
“I'm interested in individual stocks, but I don't know how to choose them.”
The me from just a little while ago fits this description perfectly.

💫1. Introduction: How to use the 'over 1.06 million yen per year' now at hand

From the first to the fourth installment, I have thoroughly reviewed my smartphone, internet, and insurance costs.
As a result, the following surplus has been created in my household budget.

Without increasing my income by even one yen, just by plugging the 'household budget holes' known as fixed costs,the source of 'medical school funds/retirement funds' exceeding 1 million yen per yearis now in my hands.

How should I grow this capital?
In the past, I was obsessed with the world of individual stocks, seeking 'higher returns'.

To be honest, this decision of 'deciding how to use it' took the most time.__________________________________________

💫2. The past of being exhausted by the labor known as 'stock collector'

Don't you also feel 'somewhat relieved' every time you open your stock brokerage app?

When I started investing, I was satisfied with buying up stocks of famous companies like NTT, Mitsubishi Corporation, and JT little by little, while being conscious of diversification.
Before I knew it, the number of stocks exceeded 40, and every day I opened the app, I was swayed by the red and green numbers.

Especially now that I am on leave, it is a time when I need to recover my mental health. Yet, constantly thinking about
“which stock will go up”
and “when should I sell” for 40 stocks
had become 'heavy labor' for me.

Naval Ravikant teaches this:

What I was doing by looking at and changing 40 stocks every day was not compound interest, but exhaustion.
And I realized. Rather than continuing to watch 40 stocks, just riding the growth of the global economy is a far more 'correct decision'.__________________________________________

💫3. My decision: Reducing 'decision costs' to zero with All-World stocks (All Country)

I organized the majority of the 40 individual stocks I held, and decided to consolidate my new NISA investment destination into just
eMAXIS Slim Worldwide Equity (All Country).

The reason I dared not choose 'S&P 500 (US stocks)' as the main one is simple.

Even the worry that 'US stocks might have higher returns' was, for me,a liability called 'decision cost'.
Instead of being swayed by the performance of specific companies,
“I am riding the growth of the global economy itself.”
“If someone, somewhere in the world earns money, my assets will also grow.”
This ultimate“simple thinking”is the core of defensive asset formation.

The realization that 'the time spent worrying is itself a cost' accelerated the organization of individual stocks all at once.
When organizing individual stocks, I held a lot of Nippon Steel, so honestly, right up until I pressed the sell button, I had hesitations like
“It might go up if the US Steel acquisition succeeds”
“Isn't it a loss if I sell now?”
but I returned to this simple thinking and decided to sell.
(As a result, there was a mysterious sense of liberation that I don't have to keep following the fate of this stock for the rest of my life, lol.)

__________________________________________

💫4. Treat high-dividend stocks as a 'mental stability reward bucket (sub)'

Of course, I don't intend to completely deny high-dividend stocks.
Dividends, which are passive income, are truly delightful.

Therefore, in my defensive asset formation, I adopt a
core-satellite strategyapproach.

I keep the satellite portion contained within a range that won't destroy the overall household budget (less than 10% of the total), balancing 'enjoyment' with 'rationality'.__________________________________________

💫5. A 'hybrid strategy' for education funds and the new NISA

Here, I will talk in detail about the 'defensive rules' I touched upon in the previous article.
I don't put all my assets into NISA (investments).
I use different weapons according to the 'time of use'.

● School expenses up to high school (Tier 2: Education defense fund)
Accumulate 'cash' using 110,000 yen per month in company savings plus bonuses.
This is an ironclad defense that keeps money needed in the near term to within 10 years away from risk.
● School expenses from university onwards (NISA)
Invest 100,000 yen per month (50,000 per child) using my 'new NISA quota'.
This plays the role of leveraging compound interest over a period of 10 years or more to grow it significantly.

'Protect the foundation with cash, and capture the future with NISA.'
Because of this clear division of roles, I can remain calm even if a market crash occurs, thinking, 'It's okay because the money for high school is in cash.' (*Details will be explained in the 7th article)

Why can I remain calm even when a crash happens, despite having felt that 'investing is scary'?
The answer lies in this division of roles.
__________________________________________

💫6. Two mental operating systems that support this 'mechanism'

This time as well, these two books supported my judgment.

First, Principal Ryo's 'Money University'.
The essence of the'power to increase'preached here is to walk the royal road of long-term, installment, and diversified investment without gambling.By pouring the '1.06 million yen' saved from reducing fixed costs into this royal road, the power of compound interest is maximized.

And, Naval.
He says,'Avoid complexity and own assets that leverage.'Holding 'All Country' means leveraging the labor of thousands of companies around the world.
I decided to quit the 'labor' of stock analysis and concentrate my brain's resources on the 'small business' of organizing information (running this note).

For those who want to test this judgment with your own numbers,
you can calculate it automatically below.

__________________________________________

💫7. Action you can take today: Measure your 'judgment cost'

There is only one thing you can do today.

Open your securities account and open the installment setting screen.
Create the 'habit of setting' before worrying about 'what to put in'.
The moment I set it up, I felt like I had reclaimed the time I used to spend chasing 40 different stocks.
__________________________________________

💫8. Conclusion

Armed with an 'annual budget of 1.06 million yen' and the ultimate weapon, 'All Country,' my household budget management has evolved into a fully automated asset manufacturing machine.

I don't make investing 'labor'; I complete it as a 'system.' You can check the full picture of my hybrid strategy for New NISA, iDeCo, and education funds, and the 'decision-making system' based on Naval's philosophy, in the roadmap below.

Next time, I will write about
how to utilize 'iDeCo and Corporate DC' to further increase tax-saving effects. This is a defensive design that keeps the exit in mind so you don't miss out on 100,000 yen of 'guaranteed profit' per year.

If you like and follow, it would be a great encouragement!

📚 The 2 books introduced in this article

[Revised Edition] Money University: How to Acquire True Freedom

The Almanack of Naval Ravikant: A Guide to Wealth and Happiness

*As an Amazon Associate, I earn income from qualifying purchases.

*This article is based on personal experience, and investing involves risks. Please make final decisions at your own responsibility.__________________________________________

💫9. [Defensive Asset Formation Plan: Full Article Index]

📚 Read them all together in the magazine

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▶ Magazine: Check out Defensive Side FIRE Diary

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