Monthly summary: January 2018

As mentioned in the December Monthly summary, I am trying to provide a better separation between an income (and expense) report, and the balance sheet. They are linked but provide a different view on the health of my finances: one shows what comes in and what goes out, and the other shows what is to stay (the net worth).

Before looking at any numbers, I know that January has been a bad month, financially speaking. I’ve had parents over for the winter holidays, I’ve bought a few presents, I’ve had a fairly expensive trip to Paris, and I’ve pre-paid most of my trips for this year. I would not be surprised if my net worth went down after this mishap – but let’s see.

Income

  • Post-tax, stable income: £3997
  • Side hustles: £0 (done work, not invoiced yet)

Expenses

To do this, I am currently using an app called Yolt – a mobile-only account-tracking application. Starting with the next month, I will be using my own automated tracker – it’s currently work in progress (more details to come in a different post).

  • Rent: £1450
  • Household bills: £525 (utilities, cleaner, cell phone, this and that)
  • Travel: £425 (pre-booked about 5 trips for 2018)
  • Transport: £282 (this being for myself & parents)
    Something I am unhappy with is that £79 of it is Uber – 10 different trips.
  • Lunch @ work: £115 (really happy with this)
  • Groceries: £205 (which again, accounts for multiple people)
  • Dinners, restaurants: £107
  • Entertainment: £93 (again, abnormal due to visitors)
  • Shopping: £623

I have not included everything from my statements, as some of them are either business expenses, or donations, etc.

Total: £3815 . It hurts, but 100% will get better in February.

Balance sheet

  • Credit card debt: £-3595 (down from £-3757)
  • Investments (Cash Savings): £5696 (up 200)
  • Investments (Funds): £6295 (up from 5982)
  • Investments (P2P): £1940.35 (down from £1983)
  • Investments: (P2P): £52.41
  • Investments (Property Crowdfunding): £49.7 (up from £49.5. Ha!)
  • Investments (Cryptocurrencies): $402.3
  • Old pension account: £18216 (up from £18067)
  • Work pension: £929

Total net worth: £33461- £3595 = £29866

Conclusion

My net worth has not gone down, but neither has it seen any major improvements. At least I know the culprits, and how to address then. Feeling positive for February!

Monthly summary: December 2017

And time has come to post my 2nd monthly update. If you’ve missed the first one, it’s available a few posts down the line. Apologies for posting it a full week after the end of December.

In order to make this kind of content more genuine, I have not prepared any notes before writing this post. I will go section by section, check my accounts, and add the amounts to the article.

The bad news: Debts

Since the last update, I have been more aware of my debts, and what a burden they are! Psychologically, and financially. I have been paying at least £500/mo towards debt reduction, so looking forward, once they are gone, this money will be available for something else.

Earlier this year, I’ve managed to pay off a long-term debt. Aside from that, I have debt on two credit cards. As planned in the last monthly update,  one of them has been paid off as well, and the other one decreased.

  • Credit card : £3757.45 (down from £4383)

Fortunately, it’s Christmas/winter holiday time. Unfortunately, this means I could not allocate as much as I’d like to debt reduction.

The good news: Savings & investments

  • Investments (Cash Savings): 5496.59 (up 200)
  • Investments (Funds): £5982.66 (up from 2652, but not due to my brilliance)
  • Investments (P2P): £1983 (down from 3342)
  • Investments (P2P): £10 (need to close this guy down)
  • Investments (Property Crowdfunding): £49.5 (up from £49)
  • Old pension account: £18067.26 (up from £17841)
  • Work pension: £900 (rough approximation, since the pension provider’s website is down. Again)

Total: £32489 (again, rough approximation. Will get better, I promise!)

The overall picture for December

December was not a brilliant month, for a number of reasons. Having my parents over has definitely put a dent in my finances. I don’t yet have a precise way to track this, but I’m almost sure I’ve used some of my savings to pay for my expenses. Another reason was taking a NYE weekend trip to France – I estimate the overall cost of this to come to £1000.

However, the bright side is that my parents gifted me some money to add to my investments. As per my mother’s words: I’ve finally started trusting you with money.

Only took me 27 years to achieve this!

Should I change this post’s format?

I’m reading a lot (116) different blogs around financial independence, early retirement, debt reduction, and I notice something I like every day.

What has already changed in this post’s format, from the last one, are the tables. I’ve tried the TablePress plugin for WordPress, but we are not friends. I am debating between using bullet points, and trying our Google Spreadsheets – will probably end up using a mix of them, depending on whether the content is static (monthly updates) or dynamic (live portfolio tracker).

Speaking of ideas from different blogs, one particular format change that I’m thinking about is separating the income statement post from the balance sheet post. The first one would track my discipline (income, spending, savings ratios), while the second would track asset growth, and the progress towards FIRE.

To give credit where it’s due, I’ve sourced this idea from Planting our Pennies (sample IS post, sample BS post).

I’m curious to get any suggestion or idea on the changes described from people who know better – so please feel free to drop them in the comments!

(mid) November 2017 – My first status update

When I was 16, I started blogging. Not daily, but close to. It was fairly easy, as I wanted to share random things with people, and Facebook wasn’t yet a big thing. I never had any well-defined structure, schedule, or style – they all evolved with time.

This current blog post will be significantly harder to write than anything I’ve written before, as right now it requires a structure (that I haven’t defined), and in the long term, it will require a schedule and consistency (this will likely be monthly).

However, the most challenging part that I have to deal with now is the actual content. I have to lay down some numbers and some stats that I don’t know/track yet. Irresponsible me, I know!

To start with, I’ll list the accounts that I can identify/remember right now:

Current account 1

Salary comes in here; credit cards are paid off from here. Doesn’t really carry a balance from a month to another, as I either spend or invest my income. Ok, mostly spend :).

Current account 2

This is used exclusively for household costs. This scheme is very useful when I am sharing the house with someone, as the amounts that have to come into this account are equal and easy to determine & track.

Current account 3,4,5…

I have several (6) other current accounts, which I will not list individually here, as they do not have balances, and they do not participate in my regular spending. The reason for having these accounts/debit cards is to experiment with the new “Startup Banks” that appeared in the UK in the last few years.

Savings account 1

A tax-free 3.5% / year account, where I contribute £200/month. Interest is paid annually, and I am planning to close it for something more lucrative.

Trading account 1

A tax-free “Stocks & Shares ISA” account, which only holds ETFs/funds at the moment. This gets a regular contribution of £250/month. The performance has not been brilliant, and the diversification is really bad, so this needs some work.

 

Peer to peer investment account 1

A peer to peer lending account which generates, on average, 5.4%. I’d like to raise this average to 5.8% before the end of 2017. This gets a regular contribution of £250/month.
The account is not tax-free, however, the income I get from it falls under my personal allowance.

Peer to peer investment account 2

This has £50 in it, lent out at 5%.

Property crowdfunding account

This has £50 (I know, right?) invested in a property in Bourne End, Buckinghamshire. I am yet to understand how the income model works on this kind of investments, as the numbers (yield + growth) still don’t add up in my head.
For reference, the average yield on the website is around 3.5-4%/yr.

Pension account 1

This comes from my previous employer, and I’m trying to move to “Pension account 3”. It currently has an approximate balance of £17000 (approximate because website is down for maintenance)

Pension account 2

This comes from my current employer and has an approximate balance of £600 (this website is down for maintenance too). 

Pension account 3

This account is empty at the moment, however, I’m planning to consolidate “Pension account 1” (in a few weeks) & “Pension account 2” (after I change my job) here in the near future.

And now the depressing part

Charge card

This is issued by American Express, has an annual fee (and amazing benefits). Since it’s a charge card, it does not carry a balance after the statement date. This is my main card

Credit card 1

This is issued by American Express too (I’m a fan) and has no annual fee. I used to have the premium version but downgraded to the free one and stopped using it. I’m only keeping it for the benefit of having history on the credit record.

Credit card 2

This is issued by Barclaycard and, and while I don’t use it, it carries a balance of £700. This is my first target for debt elimination.

Credit card 3

This is issued by Lloyds, and it purely exists because it allows spending overseas without paying FX-related fees (typically 3%). This carries a significant balance (£5000) and will require a bit of effort to eliminate.
It also carries an annual fee, which I’m not very happy about.


I apologise if this post was too long. As this blog evolves, I’ll try to find a more summarised format – I’m thinking a table, with potentially some graphs.

And related to that, I’m trying to find a UK-compatible version of Personal Capital – if anyone is aware, any suggestion is appreciated.