In a way, this feels like a ‘big’ update, but only because it’s been on my mental to-do list for weeks now (sorry), and I feel like I need something ‘big’ to say! Essentially, I keep putting barriers in the way, so I’m just gonna type and get it out there! I’ve gone and done a graph (and a table), so that’s okay enough. It just goes to show that, even after reducing work hours (aka Life 1.2), you can still get into habitual thinking that’s even more self-limiting than before!? I should know better…
The backstory: I’d been living the life of a full-time working parent/FI enthusiast since mid 2019, then last summer, I took the plunge and requested to go part-time (0.5fte). The request was for 2 years, though my thought was always that it could be permanent. I cited family and health reasons, and it was accepted. While I surprised myself with this in a way (having always been the maximiser and fairly ambitious), the signs in hindsight are there in the nooks and crannies of this blog – considering redundancy, actually considering time out totally to develop myself within my FI plan….
So, in the end, my aim was to (1) have some time to focus on myself – specifically, creative projects and health/fitness, and (2) have no expectation of increasing my ‘net worth’ during this time (since I’m half the pay I was on) but to not eat into it. So, how’s it gone?
Let’s go to the money situation first… that’s the focus for this post! Has it been hard? Well, no, but that’s mainly because when I put in the application at work, I had made the pact to myself to have no expectation of saving, so it helped that I had relaxed from being an ‘avid’ FI follower to a much looser kind of vaguely following my numbers. Just as importantly, I didn’t want to fall into the trap of not
spending investing in myself during this time, whether it’s training, courses for fun, fitness classes, train tickets, art materials or whatever! The frugal side of me sometimes wins out.
So has my net worth fallen since September 2021? While it looked like it a bit (by £491!), the world economy has taken a bit of a nosedive in the tail end of 2021. Also, I almost forgot that I’d opened a JISA with £1k! That’s a Junior Individual Savings Account, so technically that’s Junior Firelite’s moolah, not mine now. (I honestly could not decide whether a JISA is a great idea or not, but myself and Mr Firelite decided to put a grand in each just to see how much it’ll grow on its own, at small ‘loss’ to us.)
I’m pleased to report that I’ve not eaten into my savings. I went a bit spend-crazy the first few months for going part-time (new laptop, top-of-the-range notebook, courses). So, a zero savings rate until January when I somehow just put £900 away. While I was pleased with that, the fall in latter 2021 in world markets as reflected in all FIers’ tracker portfolios totally gulps up my good savings rate. Nothing to worry about, hopefully; it’s more a question of whether it’ll fall more before rising again.
I remember seeing other FIers’ graphs like this (below, over the course of pursuing FI dreams) and thinking, ‘One day, that could be me!’ I guess now it kinda is. 🙂 Except it’s hard to believe because it’s all (not even) on paper! ….Interestingly, the March/April 2020 ‘blip’ that was the start of the pandemic hardly registers now… Wow, at the time, it felt seismic!
The acceleration after that time reflects my increased pursuit of investing in tracker funds, putting more of my existing savings into the stockmarket via funds, as well as investing straight from my pay packet.
Below is a breakdown of my savings, investments and assets. I couldn’t believe I hadn’t published my net worth on here since Jan 2020! So, I don’t think I have a record of how my entire net worth has grown in one year. But my “FI stash including SIPP” has grown £26,700 in just over a year (+£1k went to the JISA). Not bad, considering I saved nothing for a third of it! Now the world markets are down, it may be a good idea to stick a bit more into my Vanguard ISA?
One of my plans had been to increase the proportion of my cash savings into stockmarket-based funds (trackers), and I’m not far from doubling this. This was a slow process; I didn’t feel comfortable moving more than £2k a month despite the mantra ‘time in the market, not timing the market’. I also sold the last of my Vanguard bond fund – which had barely moved since I originally bought them in mid-2019.
Even though I have a work pension, I made a one-off investment into a SIPP for the first time in Jan 2021. I bought a world tracker ETF through Fidelity (just based on my reading of low charges). This has done well, especially with the 25% (£5k) government top-up (Invested £20k, top-up £5k, now worth £27,100).
All the FI mantras seem to be right. I’d made myself a small fun shares portfolio, using Freetrade, at the start of the pandemic and through lockdown. It was a bit of fun for a while, investing £50 per share (or part share). But, I’ve definitely not ‘beaten the market’ there! The best performers are the ‘household brands’ we know and love (buying M&S just before Christmas last year was a good move: +106%) and the worst was when I got sucked into companies I’d only read about online and then their bubbles burst. I’d sell a few hopefully after this temporary dip.
So there you have it in a nutshell. It’s great to be back blogging! More to come…