Financial Freedom Sloth

achieving financial freedom one lazy step at a time

Month: January 2018

Special circumstance investing – January update

The last of the big moves has been done Things are going to get boring from now on. Here’s hoping it’s a profitable boring.

What did I do

Well I didn’t do a lot this month since the new leveraged position is, well, new. I like to have a nice safety buffer before adding another leveraged postion by day trading. And at the moment the leveraged position is reporting a loss. No big deal as especially in the beginning smaal fluctuations in price can cause big movements in value. Time is at my side in this construction and thing generally smooth out after a month or three. Nothing left to do as wait.

Waiting can be good.The put option on Ahold Delhaize is gone! Expired out of the money so A) I didn’t have to do anything (my preffered activity) and B) I didn’t have to pay any fees! I was right, the market was wrong and I made 750 euro because of it.

Did I do anything at all, except lazily wait? Yep, I entered a new UVXY puts position. Ramping it up: bought 71 puts, strike 6 expiry January 2020 for 4,35 USD. That is around 31.000 USD I now have in it.

The girlfriends portfolio

Same situation for the girlfriend.

AD puts are gone and entered a new UVXY puts position: 59 puts for her.

The big move was in the parents portfolio where I finally also unwound there old leverage position and set up the new one on AB Inbev as well.

All three portfolio’s are now running similar position which is a lot easier to manage. Yes, my parents portfolio also had the AD puts expiry out of the money and entered a new UVXY puts position. 43 puts for them. In total I have now over 70.000 USD in UVXY puts. I am hoping to triple this in the next two years.

For the next few months my only investment activity will be to take profits on the UVXY puts and then enter a new postion and perhaps roll the AB Inbev puts I still have. So pretty good change I will do nothing at all in February. Does that make me a happy sloth? Yes it does, yes it does … Gives me time to hunt for some more classic trance songs …

2017 full year recap

Looking back at 2017 I can only conclude it was a pretty good year. Financially we made great strides and got a lot closer to our Financial freedom (more about that below).

On the overal happiness front it is a bit of a mixed year.

I bought a Vespa and riding it does make me happy.

I didn’t lose any weight. My current condition is not good and being 25 kg overweight can not be healthy. Should make it a priority for 2018.

I did find a pretty cool new workplace but I actually enjoyed being at home a lot more. I came to the realization that for the last three years I actually only worked 8 months (or less) every year. The realization that having found a cool new work place also means working full time for the next three years (at the least) makes me a bit sad to be honest. What can I say? I really enjoy being lazy at home …

The girlfriends job started to suck this year. Which had it’s impact. She is at the moment finishing the last days of a six week medical leave, it wasn’t enough … . Work should improve again as of April. Should …  . We are not getting our hopes up as for the last few years when things for one of us started to look up, things for the other person turned to shit. A kind of perverted back and forth game of job related misery. Quiet frankly and honestely, we are both a bit sick of it. Come April – May I should be a lot more secure in the cool new workplace (only started mid November) so if things are still crap at the girlfriends workplace we will use the stash as fuck you money and either greatly reduce her working hours or just have her quit all together. A shame because we always thought she could keep her job even after fire. It is possible at her work place to only work a couple of hours a week or replace people during a few months in the year, thus making it a perfect post-fire workplace. So we always thought the girlfriend was set for post-fire and it was me that would be looking for the odd job each year. Enter idiotic managment …  Sigh.

But onto the financial recap of the year!

Personal spending

My personal income in 2017 was 30 862.70 euro.

Work: 17 084,62 euro. I was a bit surprised at the low number but I shouldn’t have been as I only worked 7,5 months this year.

Unemployment benefits: 6 452,83 euro. I collected 4,5 months of unemployment benefits in between jobs.

Gifts: 5 405 euro. Thanks mom and dad! On the other hand, their portfolio increased 14% in 2017. Their default option is to keep the money sitting in a savings account (way, way to much cash in savings accounts!) or some crap product of the bank. On their own, they maybe would earn 2% on it. Looking it from that way, I am making them money! And quit a bit more than 5 405 euro at that! Hmm, perhaps I should let them pay for our remaining home renovations …

Withdrawal from the stash: 1 750 euro. I took some daytrading profits from the table. I had planned to take all daytrading profits to hurry along our home renovations. But UVXY puts have such juicy returns I am plowing all off the available cash into that. I still need to break the news to the girlfriend. She will not be happy …

The remaining 170 euro was refunds of health care costs and such.

Of course, my stash increased in 2017 with 42.000 euro. Which is a cool 11.000 euro more than what I had as income and about 2,5 times what I earned by working.

If I take the stash into account (I usually ignore it) total income would come to 72 862,70 euro! And only 23,45% of it came from work!! If I consider the unemployment benefits as a kind of tax refund (and in a way it is) well, then my taxes for 2017 have to be in the low digits category. Ten, perhaps 15%? I ma too lazy to calculate it in detail but with all gains in the stash being untaxed, gifts untaxed and only work being taxed. Yep, didn’t pay  a lot of taxes this year … At least, when I hear a politician saying something stupid again I can find solace in the fact that I didn’t pay for it this year …

Personal expenses came to 20 718,93 euro. That gave me an average savings rate of 32,87%! (ignoring the stash earnings here, otherwise I would be at a crazy 71,56% savings rate). This is an average spending of 1 726,58 euro a month. Not that close to my 1 500 euro goal.

But I should deduct 1 500 euro for the Vespa (I used a tax refund to pay for the other half, yes I know, I made a bit of a mess of it …). So deducting that and I am at 1 600 euro average per month. That amount does include some fun:

I have Hobbies for 941 euro (mainly swimming , graphic novels and the raspberry pi) and a random fun category for 390 euro (carnival, cinema tickets, drinks with friends …).

My holiday in lazarote cost me 1 208,50 euro

If I deduct all these ‘fun’ lines my personal spend was 16 680 euro or 1 390 euro a month! But what is life without some fun in it?

On the basic expenses front, the main cost was towards our joint account: 6 800 euro. This is my half for our mortgage, utilities and food for the both of us. if it seems low, well we had a tax refund which we used to cover those expenses for some months. (Yes, I know, I made a bit of a mess of it, will do better this year, I promise).

Clothing came at 333 euro. I bought some pants and shoes. This year: shirts!

Here is a fun fact for my American readers. Health costs in 2017 were 116 euro!

I did spend 1 355 euro for food on myself. This is mainly food bought at work (i.e. sandwiches). I feel bad about it because A)bringing my own food should have been cheaper, B)bringing my own food should have been healthier. See the above mentioning of not having lost any weight. So I was actually spending money to remain unhealthy. Yeah, not happy about it!

Joint spending

If I look at our joint acount. The big categories are the mortgage ( 11 213,76 euro) and utilities 3 678,63 euro (electricity, gas and water) and then the car (2 110 euro). Bicycles, or a Vespa, really are a lot cheaper! Groceries (both food and cleaning stuff) for the two of us was 5 151 euro. That is around 430 a month. Ok, but not that great. There is definitely some fat to trim here.

Insurances set us back 1 508 euro. But that covers the house, car, Vespa and personal liability. I need to have a look into our insurances and see if a cheaper alternative can be found but I also would like to include a general insurance for legal counsel (as attorneys can become expensive fast) so I do not think any savings will be found in this category this year.

Food for our animals: 851 euro. But we love our animals so this went under hobbies.

Restaurant was 818 euro and my personal account had another 100 euro or so in this category. Some restaurants were fancy (like 280 euro for four people) but we also put our local fries shop here. health, and money wise, we go a bit too much to the fries shop.

Even in our joint account we have a random fun line, which was mostly fun, for 486 euro.

Conclusion:

If you do not buy a Vespa I think you can have a nice and even fun life with about 1 600 euro a month. I ‘think’ because this was the first year of budgeting and I definitely made some mistakes.The division between personal and joint account does not always make it easy and then there is the question how to tackle tax refunds or the meal vouchers I get from work … For next year I am going to focus more on the spending part and skip the savings rate completely. Also trying to get it as close as I can to how it would be when we would be FIRE. Still learning. Hopefully still improving …

Monthly expense report: December

The last month I report my monthly expenses in this format. As of next month I will exclusively focus on my personal spending in that month and try to get a better view on what I spend exactely (meal vouchers and tax refunds are a bit tricky). For this last month the world seemed hell bend on giving me more money. I didn’t put up much of a fight …

Personal account:

Income: 3 660 euro

Expenses: 1 521,10 euro

Savings: 2 138,90 euro or 58,44%

The higher income is from my first full month of employement at the new job. They could not meet my gross wages demand but countered with a multitude of net expense compensations. The big question was then how much all of it together would amount to. Well, I was pleasantely surprised …

I also seem to have worked enough interim work last year to qualify for a end of year premium this year. Didn’t even know that existed but not going to say no at an extra 1 500 euro!

Expenses were 1 521,10 euro. Just above the goal of 1 500 euro. I did buy presents for the parents. The girlfriend and I also had a date night which costed 40 euro. And I also spend another 100 euro for another raspberry pi. So core expenses would have been around 1 300 euro once again. And no fear, I have all I need on the raspberry pi front, so no more expenses there.

The joint bank account

Income: 4 624,40 euro

Expenses: 2 151,80 euro

Savings: 2 472,60 euro

Adding my half of the joint savings to my personal savings and my total savings are 3 375,20 euro or 92,22% of my income!

The higher joint income is because the Belgian government was quick with the refund (normally we only get it in March). An extra 2 000 which I rather have in my account than in the governments account. We also got a refund of the water company of 262 euro. Like I said, the world was really hell bend on giving us money!

Expenses were fairly low.

All in all we ended the year with healthy buffers in the checking and savings account. The year has been good for us as the full year recap will show.