🛡️ My "3-pillar portfolio": cash flow as an interest shield before 2028
Hello community,
Since there are controversial discussions under every post about CC ETfs
-> here are my reasons why I have them in my portfolio (and yes I have ki in the conversation)
At the age of 43, I am not only concerned with growth, but above all with risk management - because my real estate interest commitment expires on 30.09.2028, with a remaining debt of € 147,000.
My goal is to set up the portfolio in such a way that I can either offset the refinancing costs or pay off the debt completely.
1. the logic: cash flow meets growth
My investments are divided into three pillars with a clear function:
The cash flow engine
$JEPQ (-2,63%) & $JEGP (-0,74%) /JEPI
Generation of high monthly income (option premiums)
The growth cores
$HMWO (-1,46%) (MSCI World) & $VUSA (-1,53%) (S&P 500)
Long-term build-up of capital and substance
2. the strategy:
Two phases for the JPM cash flow (approx. 450 € net/month)
I use the high monthly net income from JEPQ/JEPI flexibly in two phases to achieve my goals:
🟢 Phase 1: Accumulation (Currently until approx. 2027)
* Measure: The monthly JPM distributions are reinvested directly into the VUSA ETF.
* Purpose: Utilize interest rate arbitrage (pay 1.88% interest, generate 8-10% gross return) to accelerate growth capital. The reinvestments are expected to increase the VUSA portfolio by over € 30,000 by the reporting date!
* In addition: The HMWO will continue to be built up separately with its own savings rate.
🔴 Phase 2: The interest shield (from 2028)
* Measure:
Reinvestment ends. The JPM cash flow is used to offset the increased monthly burden of the follow-up financing.
* Result: Even with a pessimistic 5.0% interest rate, the additional monthly burden of approx. +€227 is more than doubly compensated by the JPM cash flow (approx. €450 net).
Growth in VUSA and HMWO can continue.
3. the ultimate flexibility in October 2028
Thanks to the deposit cushion of an estimated € 259,000 built up over the next few years, I can choose freely on the refinancing date:
* Option A (Further growth): finance € 147,000 at the then applicable interest rates and subsidize the higher rate with the JPM cash flow. The entire growth deposit is retained.
* Option B (debt-free): Partially liquidate the deposit and pay off the €147,000 remaining debt in full. The property would be debt-free and my rental income of €520 would be pure surplus.
4. the tax advantage
Since all my ETFs (JEPQ, JEPG, VUSA, HMWO) receive the 30% partial exemption for equity funds, there is no tax disadvantage for the high-yield JPM funds compared to the growth stocks.
In addition, the rising interest costs of the property can be offset against the total income for tax purposes as income-related expenses from 2028.
Conclusion: I deliberately trade maximum capital growth in strong bull markets for financial security and compensation with a calculable real estate debt risk.
The JPM ETFs are
my active "interest rate buffer". -> we'll see if that works out
@Koenigmidas -> we've already had this conversation on another channel😅
