If you’ve been following along, you know the story so far. In Part 1, I sold a house I’d owned for over a decade — for about 40% less than I paid. In Part 2, the first $14,000 of that money landed and went straight into my ISA. Which leaves the question I kept getting, and kept asking myself: okay — so where does the money actually go?
First, an honest admission
I am not a stock picker. I don’t have the skill, the time, or the temperament to hunt down the next great company before everyone else does. I sat with this for a while. I read, I thought, I looked for a clever angle — and I kept arriving at the same place: I have no real edge. So I’m not going to pretend I do.
So here’s the plan (it’s boring on purpose)
I buy according to my principles. The core is a broad S&P 500 index fund. Around that core I mix in a Dow Jones dividend ETF and a Nasdaq-100 ETF. That’s the whole menu.
- S&P 500 at the center — my default, my anchor.
- A little Dow Jones dividend and Nasdaq-100 — mixed in around the edges.
- Deployed in tranches — about 20–30% at a time over a set stretch, not all in on one day.
And I don’t check the headlines first. I don’t try to find the “right” entry price. I’ve stopped pretending I can read the market on any given day. My doubt about the long-term direction of these indexes is, honestly, close to zero. So the instruction to myself is simple: just buy.
The Complete Picture — Including What I Left Out Above
Re-reading what I just wrote, I owe you a correction. “S&P 500, a Dow dividend fund, and a Nasdaq-100 fund — that’s the whole menu” is how I think about my portfolio. It is not what’s actually in it.
Here is the real breakdown, rounded, as it stands today:
- S&P 500 index funds — about 29%. The core, exactly as described.
- A Dow Jones U.S. Dividend 100 tracker — about 19%. The same index American readers know through SCHD. This is my dividend engine.
- Long-dated US Treasuries — about 19%. This is the one I left out, and it’s my single largest individual holding. It is also, by a wide margin, my worst performer.
- Cash — about 18%. Partly the house money, still waiting.
- Nasdaq 100 — about 8%.
- A small thematic bucket — about 7%. More on this in a second.
Two things in that list embarrass me slightly, and both belong in a post titled “exactly where the money goes.”
The bond position is larger than my mental model of my own portfolio allowed for, and it’s down double digits. I described a three-fund plan while holding something big that wasn’t in it. That’s not dishonesty; it’s the ordinary drift between the portfolio you describe at a dinner party and the one on your screen. But it’s worth catching.
And the thematic bucket is the receipt for the admission at the top of this article. I said I can’t pick winners. That 7% is where I tried anyway — a narrow bet on a technology I found exciting — and it is currently down more than a quarter. It’s small enough not to matter and expensive enough to remember. I’m writing about that one separately, because it deserves its own post rather than a footnote in someone else’s.
Where the Money Physically Lives
“What I buy” and “where I keep it” are different questions, and the second one turns out to matter more than I expected.
Everything I own sits inside one of four tax-advantaged Korean accounts. Not one won of my monthly investing goes into an ordinary taxable account. Each box has a different job:
- A pension savings account my employer helps fund. My company contributes an amount equal to 3% of my salary and I match it. That’s a benefit my employer chose to offer, not something Korean workers generally get.
- A second pension savings account, funded only by me. This one deliberately claims no tax credit — I explain why in the 401(k) post.
- A personal retirement account (IRP). One lump sum every January, sized to max out the annual tax credit.
- An ISA — the three-year wrapper where the house money landed. That’s Part 2.
The reason this matters: the same fund, bought in a different box, produces a materially different outcome after tax. Choosing the container is a bigger decision than choosing between two nearly identical index funds, and it gets a fraction of the attention.
“But your goal is six-figure dividends — why buy funds that yield barely 1%?”
It’s a fair question, and I get it a lot. As I write this, an S&P 500 fund yields around 1.1%, and a Nasdaq-100 fund closer to 0.6%. That is nowhere near a six-figure income. So why load up on them?
Because my plan has two phases: a growth phase and a stabilization phase.
Right now I’m still relatively young, with a stable job and steady income from work. So this is not the moment to optimize for dividends — it’s the moment to optimize for growth. Think of it as building the body first. I’m trying to get the snowball big enough that, one day, even a modest yield on a much larger number turns into real income.
Later — as I get older and retirement actually comes into view — I’ll gradually shift the allocation, tilting more and more toward dividend-focused funds. The growth engine slowly becomes the income engine. I started this in 2024 and mapped out a 20-year scenario, and so far it’s tracking to plan.
The Constraint I Didn’t See Coming
Here’s where the neat plan above runs into a wall, and it’s the thing I’m actually wrestling with as I write this.
The larger share of the house proceeds arrives in October. After I clear the remaining loan, a substantial sum will be sitting in my account looking for a home. And my instinct — put it in the tax-advantaged boxes, obviously — turns out to be impossible.
Those boxes have annual deposit ceilings. Korean pension accounts accept a limited amount per year, and the ISA has its own annual cap. Between them I can absorb only a modest fraction of what’s coming. The rest — the large majority of it — has to go into an ordinary taxable account, where dividends are taxed as they arrive and none of the shelter I’ve spent this blog describing applies.
This genuinely surprised me, and I think it’s worth stating plainly because it inverts the usual personal finance advice. Every article tells you to max out your tax-advantaged accounts. Almost none of them mention what happens when you have more money than those accounts will accept. The ceilings that feel generous when you’re saving from a salary become a real constraint the moment a lump sum arrives.
So Part 4 is going to be about a question I haven’t answered yet: where does money go when the good boxes are full? I don’t have the answer today. I’ll work it out in public, the same way I’ve done everything else here.
What about a crash?
Someday, for some reason, a 30–40% drop will come. It always does. But here’s how I’ve trained myself to see it: a 30% crash is a 30%-off sale on the exact things already sitting in my shopping cart. That’s why I deliberately keep some cash on the side — not to time the market, but to be able to buy when everything is marked down.
I can’t predict the market. The only way I can beat it is to not flinch at every high and low — to just keep buying, and keep holding.
That’s the whole strategy. No secret picks. No clever timing. Just a boring plan I can actually stick to for 20 years. The house is gone, the plan is simple, and the next step is the same as every step before it: just buy.
This is my personal story, not investment advice. I’m a 40-something engineer sharing my own journey — please do your own research, or talk to a licensed advisor, before making any decisions.
Questions I Get Asked
Why not put it all in the S&P 500 and stop thinking?
An entirely defensible choice, and one I nearly made. The reason I don’t is that the index is more concentrated than its name suggests — the ten largest companies now make up close to 40% of it. Holding a dividend fund and some bonds alongside isn’t me trying to be clever; it’s me not wanting one story to decide my whole outcome.
Why hold bonds at all if they’re your worst performer?
Fair, and it’s the question I ask myself. They pay every month regardless, and they behave differently from the equity side. But a position that large deserves a better answer than “diversification,” and working out whether I actually want it is on my list.
Did selling the house at a loss change how you invest?
Completely, and not in the direction people assume. It didn’t make me want to chase returns to make the loss back. It made me deeply suspicious of any plan that depends on me being right about one thing.
What would you do differently if you started again?
Open the tax-advantaged accounts a decade earlier and put a small amount in automatically. Not because the returns would have been remarkable, but because the habit would already exist, and the habit is the part that took me longest to build.