My focus in the next five years

As I shared that my son made his decision of going to law school, so his future is almost determined. According to his progresses academically, I project he should be able to be admitted to one of the top 40 law schools. In addition to five targets of Yale, Duke, Georgetown, UW and UNC, I will recommend him to apply five more to sum up to Ten when he starts his application process in 2017.

The cost of JD is one of the most expensive amongst all academic degrees, it ranges from 180K to 300K including everything. In the next five years, my focus as a father is to make sure that he won't shoulder the heavy student loan to force him to desperately pursue big bucks right after the graduation. 

First of all, I hope the housing market won't go down, then my rental townhouse will cover my son even he goes to Yale. I either can borrow home equity loan or sell it. According to the most current Zestimate, it may be sold at 275K next summer and could be at 300K in 2020 per my extrapolation when I possibly need to sell it. Anyway, I bought this townhouse in 2006 at the peak, couldn't be happier that it is even little bit profitable now. 

Though relying on this rental property exclusively will have covered all of my son's law school cost already, to make my own life easier, I will focus on investment in the next five years to make sure to maximize the returns. Since I created SeaPower Index in May, it has increased by 9% at the market close of last Friday. As a small investor, the performance might be too mediocre. But assuming you are running a 1 million dollars' index fund as a wealthy individual investor, you have pocketed 90,000 bucks less than 3 months. Simply annualizing the return by 4 times, your family's total return for the year will be 360K. Not everyone could build up a million dollars' portfolio, me neither, but the investing concept is the same and this SeaPower index fund is very conservative with low risks. If you are willing to take more risks, you don't need to invest so much money. 

Most of these stocks' prices in this index almost hit 50 weeks' high now, so I expect to see a little bit of retreats in the next month or so. However, toward the end of the year, most of them will hit new high's. I don't own any of them in my portfolio but do like ALK. I actually sold one of my holdings in my portfolio before its earning release and expect its price to go down another 10% before October. Then, I will buy back to shoot for 75% gain by 12/31/2016. 

The reason I like ALK is that its P/E is down below 10 and domestic travel will increase significantly given the downward of international travels. We should see tourism in US to surge during the holiday season. 

As I mentioned to many of my friends, being an average middle class family, everyone of us has to make the choice amongst all consumptions because we are not able to buy everything we want. It's why I am so happy to spend only 10,000 bucks to buy this 2009 model Mazda-5 with 55,000 miles on it. I plan to drive it for eight years. It will be a big test for it when we will be on a cross country road trip in next summer: Starting from Bothell to Chapel Hill, then along Atlantic Coast to Key West. Coming back home through Southern States but won't go to Southern Cal this time. 

If my son can get scholarship all law schools generally offer, that will be great. However, I don't rely on it because my parents were always frugal to themselves to satisfy my needs when I was young, why can't I do it for my son? Even the majority of future proceeds from my rental townhouse came from my parents originally because they sold their apartments in Beijing at deep discounts compared to today's prices when they immigrated to US 9 years ago, so I feel very normally to use it to pay for my son's cost in the next several years. Of course, if your parents didn't treat you so generously, you have the reasons not to do it for your children.It's fair and cultures are different. 

However, one crucial factor I didn't mention is that I am always able to have a meaningful full time job no matter when and where, which can ensure me to plan everything else calmly.