At the end of July last year fresh from off the first index funds boat I decided to start a blog charting my financial journey into territories unknown to me. So one year on, how’s it going? Well, the blog itself has its peaks and troughs (yes, we’re at a trough), but it’s great seeing my wealth slowly but surely grow in a way I’ve never documented in the past. Thanks to all those who have read any of my ramblings, liked, followed or/and commented – Sharing this ‘secret’ life is almost as gratifying too!
I’ve worked on most of the content for this post over the last month or so, but didn’t get around to putting it together, so apologies, it’s a month late! And the end of August update is due so I’m getting this out there now even if it’s a bit incoherent.
Well, I’m £20k better off in my savings and investments in the space of a year, and achieved an average 65% savings rate (thanks partly to lockdown). You can visualise my progress in the graphs below, or see the table for the granular detail. I’m pleased with progress overall, since I’m not what might be considered a very high earner certainly in FI circles (I’m a basic rate tax payer) and I’ve not really benefited from market growth since I started buying equities for just over a year. We’ve also not have any large purchases over the last year, which helps! I don’t imagine I’ll easily keep up this SR. Estimate net worth has surpassed half a million! Woah. Buoyed by my estimated defined-benefit pension though, with the caveats in the footnotes. But still!
A new calculation I’m going to track is my ‘FI fund’, combining my savings and investments with the equity ‘released’ by downsizing. This is estimated at £171,800 now. It’s a useful (or at least, encouraging!) ballpark; if I’m thinking I need £17k a year to live reasonably, then it could keep me going for about 10 years, theoretically! Obviously I’ve not taken inflation into account. I did also estimate my spending based on my income and savings rate (yes, I don’t track my spending) which came to £14,830 (though for transparency, I’ve never included child benefit in my income [oops], so this would be £504 – ‘my’ share).
Around October last year, I made it a new aim to save for a buy-to-let property deposit and learned about property investment, so I was pleased I managed that. After the initial flurry of viewings, my enthusiasm was dampened by the unexpected stamp duty holiday that massively increased competition combined with continuing uncertainty around the rental market in cities. But I am still looking occasionally and keeping it on the back burner.
And besides starting a small fun share portfolio too (now worth £650), let’s not forget that I also managed to start and maintain a spreadsheet of my finances! I used to keep it a Word doc which was an advancement from paper notes that I forgot to date, lol.
Slight changes in direction and habits
I was so certain this was in my plan at one point, but in the last months, I decided to write-off taking a year out of working life. On top of that, I considered and decided not to apply for voluntary redundancy. All this thinking has been wearing! My current plan is to commit to working full-time for 2 years in my job then consider quitting (in a more positive economic climate). If I manage to save £20k pa for the next 2 years, then this could buy me another 3 years of financial freedom! By the way, we’re still working from home after so many months and with the new academic year around the corner, everything’s going to get that bit harder now, on top of Firelite Junior starting school life on Monday – eek!
While some ideas were short lived, I managed to make some small changes in habits: Spending more consciously both in amount (do I really want it?) and where I spend it (do I want to support this business?). The single biggest evidence for the latter is my Amazon purchases have plummeted, though this has coincided with Junior getting older (baby and toddler stuff costs a lot then growth rate slows!) and just spending less generally. Since March lockdown, I feel less need for ‘proper’ coffee shop coffee. I make smoothies more, try to walk more, and am using a rice cooker now as opposed to microwave rice (probably our biggest lifestyle inflation since Junior came into our lives).
Goals – how did I do?
I went back over my 6 month reflection post and dusted off the goals I’d set myself. As you see in the tables, I did better with my financial than my other goals – with lock down getting its big share of the blame for my failures! As for this blog, I’m actually pleased that I’ve managed to produce 43 posts over the last year and got 65 ‘followers’. It’ll be a good while (!) before I reach the heights of Weenie over at QuietlySaving, but a few months before starting my blog, I was pretty oblivious to the blogosphere!
In the interests of getting this out there, I’ll include my goals for the next 6 months in my August month-end update. Financially, there’s very little I feel I can do to up the ante without compromising on quality of life, but I’ll keep plodding on. That’s what it’s all about, isn’t it? Thanks for reading and see you in the next post (coming very soon!).