Early Retirement

Five steps to take in 2021 to start your FIRE journey

FIRE is a marathon, not a sprint. And like any marathon you need to prepare. You won’t know where you are exactly until you prepared. With a new year coming up now is the perfect time to set these first steps! Trust me all the calculators online and simulations online will not be able to tell you the same as your very own data.

1. Start to track your income

Probably most people will be able to give some indication of how much they make per month. But what about your holiday bonus or end of year bonus? What about your tax returns? What about side incomes? They are quite common in Belgium but most people don’t know how much this exactly is. So how much do you actually make in a year? How much is your income rising each year? Start writing this down every month, and do this for at least a full year.

2. Start to track your spending

White tracking income is for most people fairly easy as its just writing down wages and tax returns every month spending is a bit more challenging.

Now firstly you need to decide where you write this down. My personal favorite: google sheets. You have it online, on your phone and has all the basics you need to start.

To make it a bit easier to input data into google sheets you can use side tools. For example KBC has a very good tool that is already displaying your expenses in different categories. I use much of the same, or at least very similar, categories in my sheet. Check out what they are on my monthly savings rate reports. My categories might not be the same as yours by the way. You don’t want your categories to be to small or to large.

3. Research investment opportunities

Rushing into investing might be an expensive lesson. Do your research first. Check out FIRE bloggers who have been on this journey for years and learn from their winnings but more from their mistakes. For example when I started I thought peer to peer was a good way to reach FIRE but it turned out to be very risky.

98% of people going for FIRE will concentrate on the stock market and real estate. Stay away from alternative investments and go for the types that are proven to work.

4. Find out what really matters in life

FIRE is about what really matters to you in life and what makes you happy. For example when I started tracking my expenses I found out I was spending 500 EUR on restaurants per month. To be honest I eat out to be around people, I personally don’t mind that much if I eat a home cooked meal or a 3 star menu in a restaurant, its just fun being out.

So I budgeted myself at 100 EUR per month for restaurants, avoided high-cost restaurants and ordered more often simpler food if I did go out, like croque monsieur for example.

In order not to alienate myself from others I started focusing more on sports and found that this is actually a good way to be around people as well. One downside is that sports costs as well. But at least when you buy stuff its much longer lasting then a 1 hour meal.

Find a good balance between going for FIRE and living your life. your life on hold to save every penny. Knowing what makes you feel good and what can make you happy without spending needlessly is a good start. Make sure you make progress but also avoid putting your life on hold since even in a marathon you need to stop for some food and drinks from time to time to keep you going.

5. Decide on why you want to retire early

Lastly you need to know why you want to retire early. This will help you in your journey to make the right choices. In my case its not necessarily because I don’t like to work (although I do have some of those days) but its also to keep my options open, and because I don’t fully trust the Belgian government that they will have enough money in 30 years to let me retire safely.

2021 is coming and its the perfect time to start to plan! Remember this is your preparation, only when starting these 5 steps you will be able to take the next step to calculate when you can actually FIRE.

Uncategorized

Savings Rate October 2020: gaining momentum at 37.92%

Time again for my favorite post. As much as its fun to see the monthly numbers of my portfolio go up, I like this post because I feel I have more control over it.

At least up to a certain extend. I do have trouble to keep expenses in check sometimes. I recently had an idea. I noticed that the last week of the month I spend a lot less, because I know I almost need to record my saving rate. So what if I tried to do only purchases the first 7 days of the month? Something to try in November and see if it will help to cut on spendings. I do expect I will then spend more in the first 7 days, but at least I will have thought a long time about what I am spending it on.

I can’t wait for November. As much as I hate lockdowns, I do think it can have a positive impact on my savings rate.

Expenses

Lets go over the different expenses for this month and compare with last month

September
October

The highlights

  • Housing: costs have dropped to 593 EUR, which is perfectly normal, it includes mainly my loan, electricity/internet/heating/Tv
  • Costs: this one always seems to surprise me. My yearly taxes on my apartment. It was a little over 400 EUR this year. I thought I was going to have a pretty good month until I ran into this.
  • Hobby’s: I purchased a second hand bicycle for 250 EUR. its full carbon so I think I got a really good bargain. Its not end of season so I thought it was a good time to buy this now in preparation for next year.
  • Groceries: I continued to shop in the Aldi, with one small difference: I stopped buying microwaved food. As you can see my Grocery bill dropped from 245 EUR to 222 EUR. So only a very minor drop, and hardly worth the effort of cooking. However cooking is also much healthier, so I think I will continue to cook most of the time.
  • Restaurants: 112 EUR, I usually aim at 100 EUR per month for this so this is fine. Its mostly getting quick snacks or drinks after sports
  • I also got 300 EUR of taxes I had to pay additionally, but I didn’t count that in, because they need to do a recalculation and I expect to actually get back 1500 EUR of taxes back in November instead

Expenses overview for 2020

Total Expenses for September = 2218 EUR

Total Expenses for October = 1904 EUR

2020 average = 2134 EUR (-25)

Income

My income rose slightly because I managed to book in some overtime. This month it was 3067 EUR, including wage, meal allowances and overtime.

Saving Rate

Given the circumstances a saving rate of 37.92 % is quite good

2019 saving rate: 45.8%

2020 average (so far): 39.33%

What’s next

  • The lockdown will lower my sport and restaurant expenses, so I should have a 100-200 EUR less expenses / month at least (tennis / gym subscription /..)
  • I just heard that the 670 EUR syndic cost I pay quarterly will be lowered to 520 EUR quarterly in the upcoming year. It will drop even more in 2022 so I’m really happy that I’m able to save an additional 150 EUR every quarter
  • At the same time the garage gate needs to be replaced which would set me back 250 EUR

Interested to follow me? Then subscribe and join me on my Roadtrip to Financial independence!

Financial Independence · investing

October 2020 Portfolio update: 2nd wave is giving a blow to the markets

Investment update in September 2020

With countries all over Europe taking measures to slow down the second wave markets are not responding well. While the drop is nowhere near the first wave right now, we can clearly see the first drop since the first wave passed. There is not much to do about it in the short run except to wait it out.

On peer to peer investments Crowdestor has opened a secondary market, that hopefully will speed up my exit. More about Crowdestor bellow.

Also Belgium has imposed another lockdown. Lots of sports I did are now no longer allowed. That includes swimming, fitness, spinning and tennis. On top of that bars, restaurants and all non-essential shops are closed. Not to mention cultural venues, fun parks and zoos also should remain closed. What hasn’t happened yet is a lockdown where we are limited in our movement. Belgium has the 2nd highest number of intensive care beds per head of the population in Europe and even our hospitals are getting overrun. I am just wondering how other countries do this without going into lockdown. One thing I am worried about is all the debt we are taking up. One day we will need to pay those back with taxes.

I can still mountainbike and run fortunately., but its not easy to fill the time. You can see people hamster again in the supermarkets, something that I will not be doing. I need fresh food and can’t survive a month on canned food. Hamstering is an automatic reaction people have when they see empty shelves. Then they automatically want to buy more. To be honest if I lived in a house with enough storage space I would have already had some supply of long lasting food, but on an apartment its not worth it for me to use up space to store food.

Alright enough stuff about my life lets go and check how much my portfolio dropped or increased.

Image result for I am not a financial advisor

My Portfolio

My Portfolio has dropped to 67009 EUR (-1260) even though I invested an additional 1000 EUR, so it just shows how big the drop was this month.

Lets look into more detail for each of these investment types shall we.

ETFs

The stock market continues to drop giving me a total loss of -2227 EUR since I started with the bellow stocks (January this year).

Inception DateTotal PortfolioMonthly P&LTotal P&L
SPDR MSCI World UCITS ETF (SWRD)31/01/202036483-983-2120
IShares Core MSCI EM IMI UCITS ETF (CEMU)28/02/20202346-42-107
Total ETF Portfolio30/09/201938829-1025-2227

At this point I am really happy I limited my portfolio to just two ETFs, it makes it so much easier to track! And I keep finding it very easy to invest with DEGIRO, I am really happy I chose DEGIRO as broker!

SPDR MSCI World UCITS ETF (SWRD)

My World ETF has made a drop this month unfortunately putting me at a loss of -5.49% since inception.

SPDR MSCI WORLD UCITSTotal PortfolioMonthly P&LTotal P&L
31/01/202025160.4100
28/02/202023674-3852-3852
03/31/202022851-3362-7214
30/04/2020290343627-3587
31/05/202029590556-3031
30/06/202031411-95-3126
31/07/202033825816-2310
31/08/2020355741749-561
30/09/202036924-576-1137
31/10/202036483-983-2120

ISHARES CORE MSCI Emerging Markets IMI UCITS ETF

With a 42 EUR win this month this ETF actually went up slightly

ISHARES CORE MSCI Emerging Markets IMI UCITS ETFTotal PortfolioMonthly ProfitTotal P&L% gain/loss
31/01/2020244800
29/02/20202249-205-205
31/03/20201918.38-331-536
31/04/20202099182-354
31/05/20202064-36-390
30/06/20202211147-243
31/07/20202318113-130
31/08/2020238265-65-2.69%
30/09/20202346-42-107-4.17%
31/10/2020238443-64-2.64%

Peer to Peer

I am left with only 5 peer to peer investments: 2 active peer to peer investments (Crowdestor and TFGCrowd), 1 with 100% of the funds in recovery (Mintos) and 2 where I am trying to recover some funds trough legal action.

I only show withdrawals here. So far I withdrew about 55% (+6%) of the funds I had invested in peer to peer.

PortfolioStartTotal at 29/02/2019Left inpeer to peerExpected end dateMoney left to withdraw
Crowdestor30/09/20192974180925/03/202260.83%
Grupeer30/09/201989908990Defaulted. In Legal procedure100.00%
Iuvo Group31/12/2019224004/20200.00%
Kuetzal30/09/201910051005Defaulted. In Legal procedure100.00%
Mintos30/09/2019998285501/06/20218.57%
NeoFinance30/09/20191273004/20200.00%
PeerBerry30/09/20192548005/09/20220.00%
TFGCrowd30/09/201914348817/09/20206.14%
Total30/09/2019284301274705/09/202244.84%

CrowdEstor

  • Crowestor has more and more delays this month. I normally had 3 projects that had to pay principal this month and none of them came trough.
  • The good news for me is that a secondary market was introduced. I put my projects on the market at 5-10% discount and was lucky enough to sell a little over 30% of my investments so far. I will keep trying to sell more, but projects that are 90 days late are hard to sell of course.

Grupeer

No progress at all from Grupeers side this month. Grupeer created a recovery firm but it seems after one month the bank account of this respectable recovery firm is not yet approved.

My main method to recover funds is legal action. I can say that its moving but very slowly. There is updates but I am not allowed to post them unfortunately.

Kuetzal

I am in a legal procedure with Kuetzal and cannot comment on any non-public information, I wanted to share more this month but I still can’t. I am currently counting on it that I can recover at least 50%.

Mintos

Mintos now allows you to see where they money in recovery is stuck. To my surprise about 200 EUR was also stuck in Monego. The rest is stuck in Capital Service. No progress here unfortunately. To be honest I am strongly considering to write off this investment. While I think I can recover the 200 EUR in Monego, I am not sure at all about Capital Service.

TFGCrowd

I still have 88 EUR in TFGCrowd because of a failed project. Normally the buy back should kick in this month and I should be getting the money back.

Startups

I still have now 3200 EUR in startups invested, I have every intention to withdraw this whenever possible.

Retirement funds

I decided not to update my retirement funds all the time since for most of the funds I get an update just once a year, so I will update it also just once a year. This is from end of 2019. I will update it again in December 2020.

November 2019Current Value
KBC Pension funds7999
First job Pension plan1467
Second job Pension plan592
Third job Pension plan12084

Wins / losses this month

  • My ETF Portfolio made a small 1000 EUR loss.
  • Slowly but certainly I am moving out of peer to peer
  • All the triathlons I wanted to participate in got canceled 😦 I need to move this goal to next year.

What is next?

  • My secret project is still ongoing

I will also post a savings rate update soon! Subscribe and make sure you don’t miss any of my monthly portfolio updates!

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Savings Rate September 2020: slowly gaining momentum at 26.67%

I really enjoy to write this post. It forces me to do some self reflection on the past month, and hopefully it makes me think about the next one. But most of all I just enjoy to play with numbers.

Unfortunately some urgent repairs at my house took a big bite of my budget. My washing machine had been leaking for over a year. I finally decided that it was not a good idea to let it go on. The whole venture to get a new washing machine costed me about 600 EUR, so a big bite from my budget. You can read more about that bellow.

Expenses

Lets go over the different expenses for this month

Recurring costs

I decided to look at the recurring costs every month to see if I could do anything about them:

  • Loan 1: 547 EUR. This actually will end by September 2021, so only 11 payments left! Unless I find a house to live in first of course, then it might even go up…
  • Syndic Costs: 647 EUR every 3 months. This will drop to 400-500 EUR by May next year. Currently it means 215 EUR / month recurring costs
  • Gym subscription: 59 EUR: its actually the most expensive in my region, but they give a lot of personal guidance and have an egym which is what I need to stay motivated
  • Tennis: I play tennis 2 hours weekly, this costs me about 15 EUR/hour (average) so 60 EUR per month
  • Gass & Electricity: 54 EUR atm, I will try not to turn on the heating at home yet since I work a lot from home now I fear this could go up
  • Internet: 27 EUR for 100 GB with Proximus. The 100 GB is not enough now that I work from home, at one point I might need to take a different subscription
  • Netflix: 6.59 EUR, which is bellow the minimum in Belgium of 7.99 EUR. How did this happen? I used to live in London and paid it there. When I moved back to Belgium the pound collapsed because of the Brexit and I kept the subscription

Right now there is not one of these costs that I would want to touch right now. That leaves me with a total recurring costs of 968.59 EUR

The highlights

  • Housing: costs have dropped to 799 EUR
  • Hobbys: again most of it is sport related. I don’t like to save on sport because my physical and emotional health is important to me. Of course there is a recurring cost of 120 EUR for tennis and Gym, but I also spend some in the Decathlon to get some extra gear for kiting, and went sailing a few times (10-20 EUR per time).
  • Groceries: I wanted to shop an entire month in the Aldi and I have. I can see a clear difference in cost: 314 EUR last month vs 245 EUR this month. So clearly worth it to shop in the Aldi, by now I also know where to find most items, so I actually start to enjoy to go there. The biggest downside I found was that I bought mostly I bought unhealthy microwave based food. So a point for October: cook more and try to eat more healthy. I wonder if cooking more will also lower my grocery bill. Let’s find out next month!
  • Shopping: I had to buy a new Washing Machine that set me back about 540 EUR. A few days after I bought it Mediamarkt lowered the price by 19%. They were so kind to give me a 93 EUR coupon I could use later. I ordered it online which was a big mistake. Delivery was a disaster. They needed to plan in 4 deliveries to finally get it to me. I will never order from Mediamarkt online again.
  • Restaurant costs are at about 139 EUR, the highest since the lockdown! So I will be watching this expense and try to get it back under 100 EUR next month.

Expenses overview for 2020

Total Expenses for August = 2289 EUR

Total Expenses for September = 2218 EUR

2020 average = 2159 EUR (+7)

Income

My income rose slightly because I managed to book in some overtime. This month it was 2848 EUR, including wage, meal allowances and overtime.

Saving Rate

Given the circumstances a saving rate of 26.76% is ok. This month it was mainly higher

2019 saving rate: 45.8%

2020 average (so far): 39.49%

What’s next

  • I will try to shop 1 month at the Aldi and cook more (at least 60% of the time), and see how this will impact my Groceries bill
  • I need to get my restaurant expenses under 100 EUR / month again

Interested to follow me? Then subscribe and join me on my Roadtrip to Financial independence!

Financial Independence · investing

September 2020 Portfolio update: volatile markets during American elections

Investment update in September 2020

I saw the stock markets go up and down like a rollercoaster this month. I heard the American elections are the reason of the volatile markets. Unfortunately it means for the first time since the covid-recovery started I saw a drop again in my stocks. My portfolio still grew slightly but that is more caused by additional investments rather then a growing stock market. At least I was able to buy the extra stocks on one of the low points during the month.

On peer to peer investments Im still trying to recover cash from Mintos, Kuetzal and Grupeer. For CrowdEstor its more the withdrawal from principal that takes time, but more about that bellow.

All triathlons I was inscribed in got canceled. For most I got all the money back, and for one partly. That’s really unfortunate but it will not stop me from trying to inscribe in new sport events. The next event I have my eye on is a 10 miles run at the Belgian coast in November. I have the choice between 8 and 16km and I think I will go for the 16 even though I have not ran more then 8km these last months, I still have some time to train.

I have also completed kite lessons this summer, and found a great bargain on a second hand kit so I can practice by myself. I will post more exact numbers on that during my monthly saving rate update.

Alright enough stuff about my life lets go and check how much my portfolio dropped or increased.

Image result for I am not a financial advisor

My Portfolio

My Portfolio has risen slightly to 68269 EUR (+831) this is mainly due to additional investments, as you will be able to see bellow the stock market has gone down slightly this month.

So this months rise was only because of a 1300 EUR extra investment. I’m not able to invest additionally every month, I invest about every 2-3 months, as soon as I can invest over 1000 EUR basically, so hopefully it will rise “by itself” next month!

Lets look into more detail for each of these investment types shall we.

ETFs

It seems the stock market got a drop last month for the first time in months, causing a small loss this month and a total loss this year of 1244 EUR.

Inception DateTotal PortfolioMonthly P&LTotal P&L
SPDR MSCI World UCITS ETF (SWRD)31/01/202036924-576-1137
IShares Core MSCI EM IMI UCITS ETF (CEMU)28/02/20202346-42-107
Total ETF Portfolio30/09/201939270-618-1244

At this point I am really happy I limited my portfolio to just two ETFs, it makes it so much easier to track! And I keep finding it very easy to invest with DEGIRO, I am really happy I chose DEGIRO as broker!

SPDR MSCI World UCITS ETF (SWRD)

My World ETF has made a drop this month unfortunately putting me at a loss of -3% since inception.

SPDR MSCI WORLD UCITSTotal PortfolioMonthly P&LTotal P&L% P&L
31/01/202025160.4100
28/02/202023674-3852-3852
03/31/202022851-3362-7214
30/04/2020290343627-3587
31/05/202029590556-3031
30/06/202031411-95-3126
31/07/202033825816-2310
31/08/2020355741749-561-1.55%
30/09/202036924-576-1137-2.76%

ISHARES CORE MSCI Emerging Markets IMI UCITS ETF

With a -42 EUR loss this month the loss was slightly lower for this ETF.

ISHARES CORE MSCI Emerging Markets IMI UCITS ETFTotal PortfolioMonthly ProfitTotal P&L% gain/loss
31/01/2020244800
29/02/20202249-205-205
31/03/20201918.38-331-536
31/04/20202099182-354
31/05/20202064-36-390
30/06/20202211147-243
31/07/20202318113-130
31/08/2020238265-65-2.69%
30/09/20202346-42-107-4.17%

Peer to Peer

I am left with only 5 peer to peer investments: 2 active peer to peer investments (Crowdestor and TFGCrowd), 1 with 100% of the funds in recovery (Mintos) and 2 where I am trying to recover some funds trough legal action.

I only show withdrawals here. So far I withdrew about 49% of the funds I had invested in peer to peer.

PortfolioStartTotal at 29/02/2019Left inpeer to peerExpected end dateMoney left to withdraw
Crowdestor30/09/20192974297407/02/2022100.00%
Grupeer30/09/201989908990Defaulted. In Legal procedure100.00%
Kuetzal30/09/201910051005Defaulted. In Legal procedure100.00%
Mintos30/09/2019998285501/06/20218.57%
TFGCrowd30/09/201914348817/09/20206.14%
Total30/09/2019284301391205/09/202248.93%

CrowdEstor

  • Some changes at the CrowdEstor site this month! You can now see how many projects are delayed. I knew I had about 20% of my projects delayed, but I didnt knew it was close to 37% of the invested cash. That now becomes clearly visible.
  • The good news is the delay is all smaller then 30 days, so hopefully its normal and they will catch up for the most part.

More good news it that in October normally 400 EUR of principal should be repaid. I’m very curious to see if that money will land on my account this month. We are talking about the projects: Indoor beach volleyball center (II), Family house developer and Construction company (public procurement)

  • Another new item is a secondary market. Crowdestor added a secondary market. I right away listed everything that expires in 2022 and everything thats late with a payment for sale at a small discount.
  • However I don’t have much hope this will work. When I look at the secondary market huge discounts are being given, up to 72.45%! So I really doubt anyone will go for the 2-5% discount offers I have on the market, even if they are not late.

Grupeer

No progress at all from Grupeers side this month. Grupeer created a recovery firm but it seems after one month the bank account of this respectable recovery firm is not yet approved.

Meanwhile my ready to withdraw amount has grown to over 5000 EUR, but of course I can’t withdraw anything.

My main method to recover funds is legal action. I can say that its moving but very slowly, it will take at least a year before anything is recovered, and probably much longer to recover a bigger amount of funds.

Kuetzal

I am in a legal procedure with Kuetzal and cannot comment on any non-public information, I wanted to share more this month but I still can’t. Perhaps in september.

Mintos

Mintos now allows you to see where they money in recovery is stuck. To my surprise about 200 EUR was also stuck in Monego. The rest is stuck in Capital Service. No progress here unfortunatly.

TFGCrowd

I was expecting to withdraw 200 EUR here this month, however this has lowered to 112 EUR. The last 88 EUR has not been paid yet, but falls under a buy-back guarantee, so I expect to have it back in two months. The money I was able to withdraw in September was transferred to DEGIRO.

Startups

I still have now 3200 EUR in startups invested, I have every intention to withdraw this whenever possible.

Retirement funds

I decided not to update my retirement funds all the time since for most of the funds I get an update just once a year, so I will update it also just once a year. This is from end of 2019. I will update it again in December 2020.

November 2019Current Value
KBC Pension funds7999
First job Pension plan1467
Second job Pension plan592
Third job Pension plan12084

Wins / losses this month

  • My ETF Portfolio made a small 500 EUR loss.
  • Slowly but certainly I am moving out of peer to peer
  • All the triathlons I wanted to participate in got canceled 😦 I need to move this goal to next year.

What is next?

  • I will postpone my triathlon to next year. I will train for a 1/4th by then!
  • My secret project is still ongoing. I will probably not be able to share any info about this until January 2021 😦 It sucks because its so exciting but its classified 😦

I will also post a savings rate update soon! Subscribe and make sure you don’t miss any of my monthly portfolio updates!