Blink and you miss it….

So just a short post for today, but something of note! Ok this should have been posted on the 18th November, the anniversary of my first ever post, but that didn’t happen with all the excitement in November. So this means its almost an end of year post, maybe something I should continue to do in the future, who knows!

I find this slightly surreal to be sitting here and typing this, but FiL is now officially 13 months old…

With the exception of the last couple of months (for various reasons) I have managed to keep a steady rate of posts, and some interesting stats:

  • I’ve posted a grand total of 80 posts – so just over 6 a month on average – I need to push to keep that up!
  • I’ve had over 10,000 views
  • Weenie has been the most prolific with the comments (63 to be exact!)
  • Where to start has strangely been the most commented on page (I clearly need to write more interesting / thought provoking articles!)

So that’s the blog side of things, what about other things that have happened since I started the blog? I am going to ignore anything around what has happened in the wider world (politics, economics etc.) as there is so much.

Financials

Retirement funds (ISA and Pensions). I look at my numbers and I simply cannot believe I am where I am. Total funds are up approximately 50% over the course of the year – the growth of this over the year has been phenomenal. I have knocked 11 months off the date that I would hit my target number already….. ok I am still not hitting my 2025 date yet, but I have another 8 years still, and a couple of good bonuses and I should be hitting it…

Overall performance has been fantastic – it is continuing to increase and go up.

I have only recently started to forecast my liquid total for 2025 so I will see how that goes over time…

I have still not knocked a year off the mortgage sadly, however it is still ahead of schedule to be paid off. I am still making an effort each month to knock down a little extra each month so it is going the right way but still remains the biggest challenge to my FIRE dreams.

The income generated by my ISAs continues to increase year on year and now is starting to generate some significant funds – as the saying goes… I’m loving it!

Work

I think it has also been an ok year work wise – I am ending the year in a great work position – new role, and another further role to help me go for promotion. Sadly it looks like the promotion is likely going to happen in 2020 as the earliest date. This doesn’t fill me with great confidence sadly but, it’s work and I will continue to put my all into it

 

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Nov ’17 Go T’ Pub Performance

So November is over, and with everything going on, having this on autopilot has been absolutely fantastic. The only time I really remember is when I see the £1,100 going out of my account!

For the full details over all of the portfolios as a summary please refer to the full month end report – this is specifically looking at what has happened on the Go T’ Pub portfolio only.

So the key bullet points for this month:

  • New Funds added. As always, the regular contribution of £1,100 has gone in
  • This month the portfolio threw out £52.20 from CTY – which will automatically reinvest and buy more. Compare that to my cash interest of approx. 4p (or 12p if I scale up to per quarter…) – it shows the difference that you get in income, for the hit in volatility
  • No withdrawal was made
  • Left over cash from the previous purchases was left in

So continue to ticking along – the second payment from CTY, so that’s over £100 now which is being reinvested, helping to offset any potential downturn that is bound to happen – this is my emergency fund after all!

Overall performance: The starting value was £12,002.06, with £1,100 in new funds added, and £0 withdrawals, meaning total starting value was £13,102.06. We finished the month on £13,025.79, so the total performance across the whole portfolio was -0.58%. Ok it’s down in percentage terms, but compared to where it was last month I am still up in actual cash terms due to my contributions.

VWRL ETF

So the standard units were purchased – a further 18 units purchased at £62.80 per unit, making the average cost per unit of £60.97 So it just keeps ticking along and increasing the number of units which all helps!

So – how does this now look as the graph data slowly builds up?

201711gtpub

LOOK AT THAT IMAGE!!!! Yes it really is time to party… a clear gap between value and contributions…. that’s magic! Ok before I get too excited, the value is really small, and we haven’t really had any slump in prices as yet, but it is nice to see that after a (relatively) short term the value is above contributions. There is a reason most advice you see in printed material says you need to leave money in for 5 years or more… either way a very “back of fag packet” calculation of a 3% return is already giving me about £20 a month in income (3% of £8k divided by 12). Or… £60 a quarter, so a main course and a drink for the two of us in the local pub each quarter (this is London…). Not at all bad.

Cash vs. Investment Trust

So for me this was the more interesting part of the overall approach – I transferred 50% of my last remaining cash ISA over to an IT and will be tracking the two together to see how things perform. Remember – you really, REALLY shouldn’t do this. Keep cash on hand, be able to sleep knowing your bills would be covered etc.

So, how is it looking?

Cash Now stands at £5,127.14
S&S ISA IT Now stands at £5,200.78

Another whole 4p from cash. That’s 12p a quarter, compared to the £50+ from CTY… but I also know if I ever need to get at the cash, then the cash amount is guaranteed, CTY I will pay £12.50 (or whatever the current charge is), a few days wait to get at the funds, transfer etc. There is a difference.

So to keep with the pretty pictures, let’s see what that is looking like…

201711cashvsstock

So all this time on, not a real difference between the two, but look at the difference in volatility. Worth remembering if you don’t like a bumpy ride! I do question if it is worth leaving in the starting value as it is hidden behind the cash ISA value, but one day there may be a slight difference!

Conclusion

So the drip feeding into VWRL is showing the benefits of the fire and forget approach. It’s still very early days at present – I can’t wait to see what this will look like in another few years. Although £20 a month (fag packet) is not a lot, its only 6 months of investments, so if that becomes £40 a month over a full year, in a couple of years that is going to be fantastic.

The Cash Vs. Stock is proving an interesting ride still. I won’t be happy until the stocks have enough to drop 30% and still be above the cash value (assuming stocks remain where they are) to know that it was worth doing.

Nov ’17 Performance

So the month has ended (a little while ago, apologies for the tardy post), and so its time to take stock of the performance across my portfolio, and compare it to the usual index of choice. This enables me to see how I am doing. As I covered in my “How I measure performance” – basically I take the value of the portfolio at the end of last month, add on any contributions for the month, and that was my starting value. End value is the value at the end of the reporting period. Simples 🙂

So November was an unusual month in terms of performance as I checked the progress through the month so little compared to usual it has, for once, been an unknown to see how it has panned out..

So, what did November do to the portfolios?

Portfolio Performance Notes
Company Pension 0.60% No income generated as all funds are in growth or reinvested
Personal Pension 0.62% No income generated as all funds are in growth or reinvested
ISA 1 -0.48% No income generated as all funds are in growth or reinvested
ISA 2 -0.36% The performance does not include the income that was paid out into my account, but is covered by the income so really need to consider both in conjunction.
ISA 3 -1.47% Although dividends are paid out, they remain in the ISA wrapper, and will get reinvested for growth. The performance figure includes both the Capital growth, and also income received which will get reinvested.
ISA 4 -0.58% Go T’ Pub ISA
FTSE-100 -2.22% This excludes any dividends
FTSE-250 -1.36% This excludes any dividends
FTSE-All -2.04% This excludes any dividends
S&P500 2.81% This excludes any dividends
Dow Jones 3.83% This excludes any dividends
VWRL 0.12%
VHYL -0.20%
GBP/USD 1.89% This was taken on the spot rate on the close of the last day of the month. Going forwards I will pick up the exchange rate from www.xe.com for consistency and real life 🙂

So the US markets continue to go up and up and up – although this isn’t really reflected in the Go T’ Pub ISA. Despite the fact that everything is down performance wise, the actual £ amount is still going up so I can’t complain too much. Given the way December is going as well makes me think that there is a slight slump underway which means I can buy more for the same price!

So overall, how is this doing in a pretty graph?

Nov17Perf

So my self managed ISA is just holding in, but the pension my IFA manages is closing in fast. ISA 2 looks bad, but then if I add in all the income it has paid out so far this year then it wouldn’t look so bad… either way they are all up so I am happy!

Thinking about 2025… well I am still not there in my forecasts sadly but it hasn’t gone any further out, so that is something! I have also started to forecast what my liquid total (i.e. ISAs) will be on that date which is quite interesting, not a huge variety since then but a reasonable chunk of change in there. I would like to increase it by about 50% on what is forecast, but then if I hit that then I wouldn’t need my pension!

How was your November performance?

Nov ’17 Income and Expenses

So November shot past, and I am sure this will not be the most accurate report (in fact I know there were some more expenses that I have not included here, but they will hit December when my Visa bill arrives…), but as always it is important to keep an eye on where the money comes and goes as much as possible!

Income

So another good income month, higher than usual as my tax code remained the same (I am dreading April next year when my tax code will change again!). Very handy drop into my account.

My other half’s ISA paid out again this month, even though this is a “slow” month for it (due to the nature of the portfolio, once a quarter there is a much smaller payment, but this is part of the diversification) it was still enough to make a small difference. I continue to use it to build some cash reserves (aka pay off the building work) and pay a little more down on the mortgage – it is all helping that end goal get a little closer.

Expenses

Right… let’s take a look underneath here! There will no doubt be things missing after what happened in November, but I expect this to come out of the wash in December with my credit card statement…. highlighting the risk that credit cards can cause if you are not careful…

Item Notes Amount
Things I choose not to avoid* Mortgage, Insurance, shared bills etc. – yes, we could move somewhere cheaper, not have insurance, reduce our bills a bit and so on, but we are where we are. 37%
Groceries All the food and other stuff needed for home 3%
Alcohol for home Home alcohol consumption only 5%
Bicycles / Car related Any costs related to either the bikes or the car 0%
Alcohol Out Generally, its the pub…. 2%
Eating Out I include purchased lunches in this as well as meals out etc. 4%
Other My catch all for anything I may have missed…. 4%
Holidays Any spending related to holidays, flights etc. 0%
Savings Anything left over! This includes money into ISAs, mortgage payments and non relief pension contributions. My company pension comes out before it hits my bank account so isn’t included, nor do I include the “top up” of money when my money goes into my personal pension (i.e. I put in £100, I register it as £100, not the £125 that gets credited in my pension) 45%

So, a somewhat unusual month all round. My “do nothing about” was much lower, this is a reflection of the increased income from my tax code change, but also that other areas were lower as I wasn’t in the physical office that much in November, so really drove down the cost. Not enough to make me think about cycling or similar, but there you go!

Food and drink this month was expensive – no real surprise there to be honest. I drank more than I should really, ate out a few times and bought expensive pre-made meals rather than anything else so all told not at all cheap, but under the circumstances, I think allowed!

The Other catch all bucket also took a bit of  hit with some taxis, parking fees and other random bits (I include my poppy donation in there as well rather than charity) but again, with the circumstances, not a surprise.

I am however staggered at my savings rate. I am really happy with a 45% although I know this is a false economy as I will take a few percentage point hits in December for things I missed. Regardless of this it means that money is still flowing into my pensions and ISAs helping to steadily build up that pot!

How was your November?

Blowing the budget (or when your emergency fund comes in handy)

So you may have noticed it has been a little quiet over here during November. The short answer is things have been, to put it mildly, very, very busy. You know you are starting to get tired when you put the silver foil in the fridge instead of the cupboard….

So what has this got to do with the subject? I am glad you asked… this post is more around how your emotional side can affect your spending patterns and habits. What follows is not meant as a cry for sympathy or anything naff like that, but to demonstrate when money takes a back seat when emotions come into it. And that’s coming from me who tracks and categorises every last penny of spend and income!

The Background

So first it is probably worth setting a bit of background context. Last year I received two phone calls of the variety you always dread but know will happen one day. The very short version of it… “Come home…. now.” from an immediate family member. Whilst in the office. Never a nice thing – I am fortunate that my company was super supportive at the time.

This November I had a very similar, but possibly worse, experience. Sitting in an open plan office, on a conference call (fortunately internal), I had a missed call from one of my immediate families neighbours. To put it mildly, this is unusual so I knew something was wrong. Not wanting / able to drop off the work call (I was chairing), I texted to ask if all was ok and of course got the inevitable “Erm.. not really” response.

Needless to say we then spoke, where I was kindly informed that an immediate member of the family had been taken off by ambulance. They didn’t know where, or what was wrong. Cue 30 minutes of calling around the various hospitals near the family member until I finally got through to the “Ambulance Assessment Centre” (who knew ambulances needed assessing, but I digress…). Due to patient confidentiality they couldn’t tell me anything other than confirm the person had been brought in. Their mobile telephone wasn’t responding so something was definitely not quite right.

A very quick chat with my boss resulted in the “Just go” response – once again something I am hugely grateful for, the support my boss and the company have given me.

Blowing the budget

As soon as I got the nod, I packed up my work kit and headed back to our home, threw some clothes into a bag and loaded up the car (I had kept my head with me and packed a cold box as well as there are some farms up there!). As I had no idea how long I would be away for, not knowing what was wrong, I grabbed my away wash kit (lasts up to a month – vital for travel) and shoved in enough clothes to last me 5 days.

Then followed a lovely 200 mile drive up the wonders of the UK Motorway network. Unexpected costs here were the diesel and the M6 toll fare – honestly I just didn’t care I just wanted to get to the A&E department as fast as I could (within the speed limit, but faster than my usual 60 mph cost effective driving!). They could have charged me double and I would have paid it.

Eventually we arrived at the A&E department and, of course, had to pay parking charges. Lovely. Fortunately I had the change but no idea how long I would need so I just chucked some money in. When we did eventually manage to find our loved one, the only way we recognised them was by their shoes, they didn’t look like themselves. Never pleasant,but highlights the importance of being able to drop everything and go.

We remained in A&E for sometime and spoke to the doctors and nurses around what had happened and what was going on. Eventually we did leave (this may sound really harsh…) as what else can we do? Sitting with someone who is unconscious through the night isn’t going to help them or us, but being there in the morning of the next day would.

By the time we left we were very hungry, and of course hadn’t eaten since a quick bite at lunchtime. Driving round “my old stomping ground” all the restaurants and bars were shut, even the tesco’s was closed. The end result is something I am not particularly proud of, but I will admit it. We ate in McDonalds. Definitely not high quality food but we really did not care – it was food.

For a week I followed pretty much the same pattern. Wake up early, try and squeeze a full day of work before heading to the hospital, getting home about 7 hours later, to then finish work, sort out food and, naturally, have a drink!

So, what impact did this have on my spending? Well, firstly I don’t really know exactly how much I spent. I have an idea, I kept receipts where possible, calculated rough parking charges etc. but my November figures are a bit random, but.. this is roughly what went down…

  • Toll road costs, diesel and trains. This was quite random but knocked things up quite a lot as Mrs. FiL kept going back to London for work then back to me, bringing clean clothes wherever possible
  • Parking Charges. I am really not sure how much I spent on charges as I was parking there every day but there you go – I took a guess
  • Eating. I place this as largely open. We had a couple of takeaways, pub meals, hospital canteen meals and a lot of instant meals – basically anything that meant we could eat fast with minimal effort – so paying the price for convenience
  • Extra “items” – ok I had to buy some random clothes to keep me going – nothing major but simply to give me clean clothes – whilst I washed what I could I wasnt able to do everything so had to buy some cheap and nasty stuff – but it covered me!
  • Other – I will just label this as everything – so books / papers / orange juice etc. – things that they felt like that would make things more bearable for both us and them

One thing I am eternally grateful for is that the last thing on my mind was money – yes I knew I was spending way more than I should, and whilst it hurt in the sense I ate into savings, it meant that I didn’t have to worry about anything financial – I could deal with things as they happened.

THIS is why you need the emergency fund – for emergencies. You never know what will happen in life – I am lucky that I was able to continue investing at the same rate, but I was in effect cash flow negative. I can’t imagine what that time would have been like had I also had finances to worry about. Bliss would have been being FI and not caring, but as it was I think I got the next best thing – a supportive work and not worrying about money.

Remember folks, make sure you keep that emergency fund intact (and not invest in the market…) – know how much you think you will need.