So officially it’s been 1 month (and many more to follow) since blogging about my Financial Independence Retire Early journey. I’ve mentioned in one of my earlier blogs that I did start the journey back in July of 2018 “officially” but 2019 is becoming a period of time where I am knuckling down and officially recording data / tracking income and expenses on a finer level.
Income & Savings Rates
January was a bit of a fluctuating month in terms of income (I.E. Not normal!). My salary and combined LTD company dividends came to £12,700 for the month. These dividends aren’t from investments, but the business that I own / run. I would envisage that most Ltd company owners pay themselves a portion of salaries and dividends due to the very minor (government have very much focused on this route) tax benefit that this form of payment receives to an individual. Of this, I invested £6,250 into my S&S ISA and £1,313 into my stocks and shares market trading account. This has resulted in an average savings rate of 61%! Wahoo! Which of course I’m super chuffed about. This works towards one of my core goals for 2019 (outlined on My Goals page) that I’m looking to achieve an average savings rate of 45% (so far so good – I’ll probably review this come April-19 time to see if I need to push myself past the 50% savings rate).
Furthermore I’m reaching out to work towards saving £20,000 into my S&S ISA by April 2019 this year (to obtain the maximum allowance for 2018/2019). This means, that based on my regular investment of £1,666 p/m into my S&S ISA, I need to find another £1,752 between February and April to see this goal come to fruition. I’ve chosen the £1,666p/m payment into my Global ETF (S&S ISA) account with Vanguard because £1,666 multiplied by 12 = £19,992 (essentially the maximum £20,000).
Here’s a quick graph to illustrate so far the breakdown of total investments between my Stocks & Shares Trading Account and my Stocks & Shares ISA;
Unfortunately though, as much as the upwards direction of these graphs illustrates fantastic growth, the ‘total invested’ is actually more than that of the ‘actual return’ for both accounts. I’m certainly no investment expert and following on from Tim Hales Smarter Investing decision making and thought process, the markets have certainly been turbulent over the last 6-8 months. My strategy is to buy and hold, removing emotions out of my investment decisions. The benefit in my favour is that I’m relatively well diversified in a Global ETF fund provided by Vanguard for the time being (where the majority of my current pot is) – however, with a slight weighting towards the US market, I may need to look at this later down the line.
I’ve been monitoring my expenses closely and been reading up on various FIRE related blogs to get a hold of some really neat tips to work on cutting down on spending. Even though these are obvious to most, I was amazed to see the difference between my expenses from months past to Jan-19 in just employing a few of these money saving tasks;
- I’ve made my own lunch (with the help of my partner) every single day for work. This alone has saved me hundreds of £’s in the month (Food is bloody expensive it seems)! I’m also on a bit of a weight loss health programme as well as my partner goes to the local Slimming World group so we’ve swapped the usual Waitrose shop to Aldi / Lidl. On some days where we’re really tired, we’re giving the ‘Slimming Ready Meals’ a go from Aldi (which are actually really tasty) – 12 minutes in the microwave at work and job done! We’ve been going to Aldi / Lidl on a Thursday evening because we’ve worked out this is where they place the 50% discount labels on food during the week. We bought two, free range whole chickens (large) for £5.00 (£2.50 each) – sure the sell by date was the next day, so we slow cooked one and froze the other!
- I’ve worked from home (some days of the week) to cut down on fuel costs. Work is around a 30 minute drive (16 miles in total) so cutting down on going to the office and working from home has saved me a considerable amount of fuel 1/4 of my monthly cost.
- I sorted out my bloody insurances! Jesus – I’m sure some would comment on saying how silly I’ve been to ignore these costs. For me and my partner, who we’re both relatively fit / walk the dog each day etc were paying close to £200.00p/m on Life Insurance, Payment Protection Insurance and Critical Illness Cover. I was amazed at how much this was per month and where the hell I signed up to all this rubbish? Well, it all came from my mortgage broker, which after a bit of Googling around of course they receive a commission for as many of the ‘insurance’ products they can sign their customers up to. Why I didn’t say no to this is beyond me (wet behind the ears and all that) but I did feel like slapping myself in the face and saying ‘wise up’ – Anyhow this is all sorted and now for Life Insurance and Home Insurance I’m paying £25.00p/m all together. Of course, I went through Top Cash Back and then bought my insurances through Confused (which is one of the cashback offers on the website) so all in all I profited from my own initial sign-up! (In total, by going through Top Cash Back, I gained £88 in cashback to signup for these cheaper insurances…. It’s a win win!)
As part of my tracking, I’ve separated my expenses into ‘Bad Costs‘ and ‘Total Costs‘ (see below table);
(There were those insurances I was paying!). I do have a Loan with Zopa (P2P lending company – very good rates) that I am paying off (more than my monthly amount required) with the aim to clear these by next year. In total my bad costs came to £1,279.28 – I will need to work on this figure because my partner currently pays our council tax and water bill, so this isn’t truly reflective of the outgoings of the house. I will eventually work on integrating these costs into my spreadsheets as they will certainly work towards reducing my savings rate month on month.
Our ‘Sundries’ are essentially food, gifts, car servicing and odd bits and bobs that we spend per month. It’s only me and my partner and we budget for £40 per week on food (I guess some readers skin will crawl with envy but remember we don’t have kids (yet) – Got all that to look forward to!).
What a fantastic month it’s been for my matched betting journey! I’ve only recently started and still ultimately learning the ropes. Again, special thanks to Dan over at Pursue Fire for helping put together the strategy and spreadsheet (the starting blocks for a new comer like me).
For January 2019 in total;
- 78 Total Bets Completed
- 12 Winning Bets
- 16 Placed Bets
- 50 Losers
I put in a total of £750 into the kitting (spread £50 across 6 bookies – Bet 365 / Ladbrokes / Sky Bet etc) with some left in the bank for top-ups and balancing. In January, (which I officially started each way betting on the 27/01/2018 I ended up with a profit of £510.31. I’m counting myself very lucky this month (perhaps beginners luck?!) – all in all though, the strategy and outline Dan has mentioned on Pursue Fire is very much the foundation of my Each Way Betting strategy (nothing more nothing less!). I stake £5 on win and each way (total £10) and pushing my total risk per bet past the 1% mark.
All in all, that’s really about it! Until my portfolio grows and have some solid data behind my savings / expenses (i.e. 6 months worth) I can’t really comment yet on anything else bar from what I’m doing! I’ll look at publishing a post regarding my individual stocks in the next few coming weeks but until then, see you next time folks!