Goals For September And Beyond

Quite frankly the last year has been pretty piss poor for me in terms of setting goals, getting stuff done and generally feeling like I’m moving forward with my life. I went through a time in my life about two years ago where things seemed to be going really well. I was making sure I got lots of sleep, which meant I had plenty of energy. That had the knock on effect of me getting loads more done. Work was going well, I was enthusiastic and felt like I was gaining new skills and carving out a role for myself in the department that hadn’t really existed before, but which suited me down to the ground. That’s no longer the case.

I’m hating work at the moment, which is making it really difficult to feel that I’m making any progress with the rest of my life. Work is so busy and stressful that it’s sucking any motivation for me to do anything else. I finish work and am so exhausted and mentally drained that I don’t seem to have the will to do anything other than sleep on the couch and do the bare minimum to survive and keep me and my boys ticking over. That’s never been enough for me. I need to feel that I’m getting somewhere with my life, no matter where that happens to be. As long as it’s moving the way I want it to then I’m happy. Just now I feel like I’m somewhat stuck.

I’m barely running, which is always a bad sign. I know I feel so much better when I exercise, but I just don’t want to go out. I’m averaging about one or two runs a week, mainly when my friends arrange for us to meet up and get a few miles in. I can’t keep up with them any more as I’ve lost so much fitness, which again makes me not want to run. It’s not helped by the fact that I have an ongoing problem with my knees, which doesn’t particularly seem to be helped by resting or the physio exercises that is the one thing that I have been continuing to do. I always feel much more in control of my life when my running is going well. It really does make you feel like you can do anything you put your mind to.

It’s not all doom and gloom though. On the financial side of things I have things pretty much automated so that I don’t need any willpower to stick with my plan. I’m more or less on autopilot with my budgeting and my investments go straight out of my salary and fly out of my bank account by direct debit. The one good thing I have done during this lacklustre period of time in my life is diversify my investments. This is very much still a work in progress, but at least I’ve pretty much stopped investing in shares of the company that I work for (apart from one too good to refuse deal – £75 worth of shares every month for only £30 of an outlay from me – yes please) and have started buying index trackers instead. I still hold far too many work shares, but I’m working on changing the balance on that over the next few years.

To try and jolt myself out of this lethargy I’ve decided to start setting myself goals again. I always used to do this. I like to have things to work towards and feel that I’m making progress on the things that are important to me. I usually set myself far too many goals and end up feeling overwhelmed, but sometimes that’s the only way to get things done. You might not achieve absolutely everything, but at least you do nudge yourself along in the right direction.

As usual, despite this supposedly being a FIRE blog, (actually I think it’s more a journey of the ups and downs of my life and an attempt to keep myself accountable to me if nobody else) the goals are not finance based. As I said I have a lot of my finances automated. If anything what I need to do is stop checking my money so often. I have a ritual whereby at the end of every working day I check my Vanguard account to see what it’s worth. That’s not useful, healthy or even all that encouraging. I do it anyway. It’s my treat to myself for surviving the day and a reminder that I won’t be living this life forever. It does however often lead to me wishing my life away by focussing solely on when I am going to reach my magic number and can stop working.

The ridiculous thing is that because a major part of my retirement plans focus on my defined benefits pension, and because there are some pretty serious penalties for retiring before the normal retirement age of 60, chances are I’ll be working for the next ten years come what may. Now saying that, I’m hopeful that once I reach some of my financial targets that I can negotiate a shorter working week. A four or even better three day working week sounds pretty civilised to me. As my pension is based on a salary that was capped a lot of years ago when I was working part time and quite a few grades lower than I am now, I could reduce my working hours and not impact my pension much. So although I might not be able to RE – or at least as early as I would like, I am hoping that I can take advantage of FI if I ever get there and make the last part of my working life much more tolerable.

Really I should be setting myself a target restricting the number of times I check my Vanguard account and look at my Net Worth figures and charts. I should do that, but where’s the fun in should. So I’m not going to restrict myself in that way for now. I am just going to try and remind myself that we have a finite amount of time on this planet and that I should be spending the time I have living my life to the full rather than looking longingly towards a time in some mythical future when I don’t have to work.

I’m going to try and enjoy the parts of my job that I do enjoy – which rather ironically is the bits that are ostensibly my actual job title. I do actually like talking to customers about their finances and helping them to sort things out. Of course there are days when I can’t really be bothered, but overall it’s not a bad job to have. It’s the nonsense that goes alongside it that is hard to take. The lack of time to manage your cases and the constant pressure to get on the phone and take yet another call despite having things to sort out for customers you’ve already spoken to.

So, enough about goals that I’m not going to set myself. What is important to me and is going to set me up for success in all areas of my life?

Get 7 hours sleep a night, 5 nights a week. This is a crucial one for me. I’ve always needed a lot of sleep. If I’m tired , which I usually am, then I can’t get anything done. When I was regularly getting 7-8 hours of sleep a couple of years ago I felt fantastic. The nights I got a full eight hours I felt invincible the next day.
Do 4 forms of exercise every week. In an ideal world this would be 3 runs and 1 cycle or walk. Back in the real world I know that my knee often can’t deal with this. I’m loving going out on my lockdown bike and really want to do more of that. This should get me back in the swing of exercising and hopefully I can build my running fitness back up.
Complete section 5 of the Duolingo Spanish tree by the end of the year. I am now on a 455 day streak on Duolingo. This sounds quite impressive, but quite a few of those days were just a quick 5 minute burst, useful but not enough to see real improvements. I finished section 3 on Christmas day and only finished the fourth section the other day, so I really should be further on than I am. This is going to be a real stretch goal for me and will require a decent amount of studying every day. It should be achievable, but only if I really stick in.
Find a new Spanish series that I want to watch and see at least 2 episodes every week. I finished watching Valeria on Netflix a month or so ago. It was far too fast for me, so really difficult to understand, but crucially I loved it and really wanted to watch it to find out what happened next. I need something else like that as it’s the only real way I’m going to improve my listening skills
Keep my car mileage under 69,000 by the end of the year. It’s raining and I can’t be bothered going out to check my current mileage, but the last time I checked a few weeks ago it was sitting at 68,648. Hitting this one will depend on a number of factors. It’s either totally achievable or completely impossible. Since lockdown I have implemented a rule that if a journey is 3 miles or under that I don’t take the car. The exception to this is if I have shopping to get, the kids are with me or there is a time constraint. Sounds like lots of get out clauses, but actually even on a 5 litre paint buying expeditions that was 3.5 miles away I walked rather than taking the car. I’m still doing the weekly Aldi shop by car, but as one of the kids comes with me and I have shopping I think that’s acceptable. I have no intention of stopping homeworking, so there’s no commute to do. The issue is going to arise if I need/want to go to Newcastle to see family, and I’m not going to restrict myself on that. Also maths boy is going off to university in October and so I’ll be going down to drop him off. The ex hubby and I are going down together. If we can get all the stuff in his car then he will probably drive as he thinks I drive too slowly, (AKA sticking to the speed limit) but if we need to go in my car then that’ll be me screwed for hitting this goal. I suppose I could take long journeys out of the target if needs be.

I think that’s plenty to be getting on with. More sleep will help my energy levels, which hopefully will make me more motivated to exercise, which in turn will give me the will to get stuff done. Maybe then I can look at some more stretching goals. At some point I will need to address my shocking eating habits that have developed during lockdown and the subsequent weight gain, but that is something I’ll worry about another time. For now I’ll keep it simple. Get more sleep, exercise more, work on improving my Spanish and keep up the good work on restricting my car use.

My Very Meandering Road To FIRE

Later this month it will be my twenty year anniversary with work. I honestly don’t know how that happened. I moved to Scotland around the Easter time and had already sorted out a job as a sales rep selling advertising for one of the free newspapers. I lasted all of three months in that job and realised that it wasn’t really for me. It was certainly an eye opener. Driving around various small towns in Fife and calling into small businesses. I used to have to go back to the office and ask what certain words meant. Divided by a common language doesn’t just apply to Britain and the States.

That was a really exciting time for me. I was moving up to live with the now ex husband. We’d met the year before and had a bit of a whirlwind romance. We met on a two week residential training course for BT, so effectively we had a holiday romance whilst getting paid to learn how to sell phone systems. We both fell pretty hard and pretty fast, so by the Christmas we were talking about whether he would move down to England or I would move up to Scotland. To be fair there wasn’t much of a discussion. After a fairly recent divorce I was ready for a fresh start. I’d always loved Scotland, and having devoured the Outlander books as a teenager I had a bit of a thing for all things Scottish and men in kilts! Also there’s a lot more job opportunities up in Edinburgh and the surrounding areas than there ever would be in Newcastle.

That was a fairly interesting year that I had. I did pretty much every stressful thing that you can think of. I got divorced, fell in love, learned to drive, moved countries, started four new jobs, moved house four times and got married. Oh, and turned thirty too, which at the time felt incredibly significant and a sign that I needed to sort my life, but with hindsight was me still being incredibly young and with most of my life still ahead of me. The funny thing is though that it didn’t feel stressful at all. It was one of the happiest times of my life. The world seemed full of possibilities. And because I hadn’t had kids with hubby number one the divorce felt incredibly freeing, although of course really sad too.

I had a flat in Newcastle that was on the market, but took a little bit of time to sell. I bought a flat a couple of miles from Newcastle city centre for £32k. I sold it three years later for more or less what I’d bought it for. I had one of the infamous Northern Rock 120% mortgages, but luckily I’d been very restrained and hadn’t borrowed any more than was absolutely necessary. The real reason I went for that type of mortgage was that it offered the opportunity to have a guarantor. I needed this as I was working through an agency and was sadly lacking a permanent contract. My dad duly stepped up and with him on the mortgage I was able to borrow what I needed for my first flat. The folks lent me the money for a deposit as well, so that I didn’t need to go anywhere near the amount Northern Rock were looking to throw at me. Maybe I wasn’t quite so disastrous with my money back in the day as I thought I was. Over the next two years I worked overtime whenever I could, regularly working extra at the start and end of my shift and every Saturday too. Within two years I’d saved up enough for pay back the money for the deposit. Very Sassenach Saving of me!

Although my now ex ex husband lived there with me it was me that bought the property. He was an absolute nightmare with money, and even way back then I knew it was a good idea to keep my finances to myself. I loved that flat. There’s something really magical about the first place you actually buy. It was so handy for town too, that I could just hop on a bus to get into Newcastle, but a lot of the time I’d just walk in. I was sad to sell it when I moved to Scotland. I did think about renting it out, and I guess my finances could look quite a bit different if I’d done that. I took out a twenty five year mortgage, as everybody did back then. That would have been all paid up next year, so if I’d kept it on a repayment basis then I would be about to be mortgage free on a two bedroom flat within walking distance of Newcastle city centre.

On a side note, it’s a really bad idea to go online and see what properties you’ve previously owned have subsequently sold for. I did this last year, and discovered that the person I’d sold it to for £32,000 had sold it about four years later for more than double what I’d got for it. And when you see that same flat is worth over £100k now it’s somewhat annoying. Oh well. I did sell as I thought it would be a hassle trying to manage things remotely.

I quickly realised that filling the paper week in and week out with ads for car garages, furniture shops and various tiny businesses was a thankless task that would quickly become dull. The most exciting thing about that job was the day’s training in Edinburgh in The Scotsman building. It was pretty exciting being in there and seeing the hustle and bustle of a large newspaper. Sadly the regional office where I worked was nothing like that.

I started to look around for other opportunities. Back then that’s what I used to do. I didn’t feel weighed down by responsibilities. I didn’t have kids, I certainly didn’t worry about pensions, investing or any of that stuff. The two of us were having a grand old time. Initially we were living on the outskirts of Edinburgh, so would have plenty of nights out in the city centre. We also made the most of nearby cycling opportunities, heading out on the bikes after work in the summer. We were having a grand old time being young(ish), in love and generally having a lovely time going out for meals, drinking and buying whatever we fancied.

That’s when we started building up credit card debt. Not horrendous in the grand scheme of things, but certainly not very Sassenach Saving of me. Neither of us was on great money, but we should most definitely have been able to manage if we hadn’t been going out so much and buying random things. That went on for a couple of years and then we had a word with ourselves. We started paying a set amount off each month and stopped spending more than we were earning. We were married by this stage and talking about starting a family a few years down the line. I think we both felt that a solid financial base would be better than racking up yet more credit card debt. I remember being very focussed on paying off that debt, and delighted when it was finally cleared. At that point we started overpaying the mortgage, so things were most definitely going in the right direction.

Although the internet was most definitely a thing back then, it wasn’t such an everyday part of people’s lives. You certainly weren’t going online with a phone, it was a big box in the corner of the room. Maybe if we were online more we would have discovered the whole FIRE thing. I remember obsessively reading a book about people changing their lives by downshifting. It was really something I was keen to pursue, but it was very short on practical advice. There was lots of talk of people getting big redundancy payouts and wafting around teaching yoga and the like. No real advice though for how to come up with a plan to get you to financial independence without a payout from work or a rich husband. Over the years I kept coming back to that book, but I could never figure out how to get to the place I wanted to be. Not until many years later anyway.

I can’t even remember how I discovered FIRE. I stumbled on The Minimalists by seeing their film on Netflix. From there I think I started seeing links for financial sites and I must have found FIRE from that. Who knows really. What I can’t believe is how long it took me, considering this movement is exactly what I am all about. I’ve long believed that money is a tool to buy you options. I’ve always known that stuff isn’t important to me and that I would rather have more time than more money. I might have lost my way slightly at times, but I’ve always been searching for a way to live my life without being consumed by work.

I might have come to my FIRE journey late, but I’m certainly committed now. My FIRE journey most definitely isn’t the most conventional. I’ve made plenty of mistakes along the way, and am continuing to make choices that are right for me, but most definitely not the most efficient or perhaps even the most sensible. I guess that’s one of the things I love so much about this FIRE movement. Everybody’s journey is different, and that’s ok. We are all aiming for slightly different destinations, and will get there in a multitude of fashions. We’re not all the same, and I think we should embrace that. We can learn from each other, whilst accepting that’s what right for you might feel completely wrong to me. As long as we end up where we want to be and enjoy the ride then it’s all good.

July 2020 Net Worth

It’s time to tot up what I’m worth again. I’ve decided to make a change to how I calculate my figures. I have a defined benefits pension with work that I have never actually included in any of my net worth figures. Considering this is one of the big reasons where I stay working where I am then this seems absolute madness. A big part of my retirement plans centre around the fact that I will have about ten thousand a year from this pension if I can stick it out for another ten years.

As of this month I am now going to include it in my figures. I’m going to take what I have accrued so far, well at least as of my April 2019 statement, which is the most recent one that has been produced. I’ll take that annual figure and multiply it by twenty to give an approximation of what it might be worth once I can start drawing it. To complicate matters slightly I’m going to include it in some of my figures, but not all. I like to be able to separate out what I could theoretically cash in right now if I have a mid life crisis that necessitates me liquidating everything.

The plan for now then is to include the DB pension in the overall net worth figures, but also separate it out along with the house equity to give me an idea what things look like if I want to stay living where I am but cash everything in to clear the mortgage. This allows me to see how close I am to being mortgage neutral, which is an important target for me. I don’t want the pension muddying the waters on those figures, so it’s getting put to one side for that calculation.

As usual last month’s figures are in brackets for comparison. Clearly it’s going to look like I’ve had a massive bump up of my net worth from last month to this. I wish. At least moving forward it will give a more realistic picture of what my finances look like. I definitely need to have a think about how to represent my finances in a way that more reflects my own situation.

As I have the DB pension giving me a half decent starting point I really need to find some way to measure how I’m doing in making up the shortfall in what I’ll get and what my living expenses are likely to be. I have a bit of an idea in my head about how much I need to live on and so how much I need to grow my investments by. I think I’m on track, but I definitely need to flesh that out a bit.

I really need to start measuring my savings rate as well. I had a bit of a shot at calculating that, but things are all going to change come October when maths boy goes off to university and my maintenance halves. My tax credits and child benefit have already reduced down, so I’m living on slightly less than before, but still trying to save just as much. At the moment I’m struggling to see how I will manage to keep saving the same amount, but no doubt there are some savings that I will manage to make. That sounds like a bit of a project for me towards the end of the year, to measure things a bit more and see how I’m doing towards the targets that I have in my head, but not recorded anywhere.

Enough of my thoughts about new things to record. Without further ado here are July’s figures and how they look in comparison to June.

Debts

Mortgage £97,790.14 (£98,281.81)

Assets

Cash £33,612.22 (£36,507.46)

Defined Benefits Pension £123,683

AVC’s £6,440.24 (£5,567.13)

Shares £37,782.93 (£36,282.17)

House £250,000 (£250,000)

Total Assets £451,518.39 (£328,356.76)

Net Worth including house equity

£451,518.39 – £97,790.14 = £353,728.25(£230,074.95)

Net Worth excluding house equity and Defined Benefits Pension

£77,835.39 – £97,790.14 = -£19,954.75(-£19,925.05)

The cash amount went down not because I went on a spending spree, but rather because I took about three thousand from my savings and bought some more index trackers. I had too much cash on hand as a result of the further advance that I did earlier in the year on my mortgage. I’ve still got enough savings sitting there that I can get my boiler replaced when it finally gives up the ghost and get my en-suite sorted when I’m more comfortable with having people working in the house when it’s not strictly speaking necessary. As far as getting a new car is concerned, I’m still of the mindset that as I’m currently driving about three miles a week to go to Aldi then the new car can probably go on the back burner for the foreseeable future.

The fact that I’ve spent £3,000 on new trackers along with my normal £600 that I do anyway, means that the increase in my shares value is particularly poor. The index trackers are actually doing pretty well. As usual it’s my work shares that are letting the side down. If I could go back in time I would tell my younger self to forget about doing share saves and just stick the money in index trackers. Unfortunately I don’t have a tardis in my back garden, so I am where I am. My plan is to pretty much just forget about the work shares and maybe at some mythical point in the future they will recover. In the meantime I will just keep sticking as much as I can into my Vanguard ISA. By the end of the tax year I will be up to the maximum £20k, which is pretty good going. That’s going to be a one off though, as it includes the money from cashing in two share saves, transfers from my savings as well as my normal monthly amount. I’m definitely not going to be in a position to do that every year.

I’m reasonably happy with this month’s figures. My AVC’s and index trackers are doing pretty well. The work shares are down about £2k, but what’s new there? I’m quite comfortable with the strategy that I’ve got going now. I’m slowly getting a bit more diversified away from having everything in work shares. At some point I’ll offload a big chunk of these, but not just now. Even if they start paying dividends again next year that would be a bit of a help and a reason to keep hold of them until the price is very slightly less dire. I’ll keep plugging away with my index trackers and hopefully they will continue to rise in value. I was happy to see this month that the combined value of my AVC’s and trackers are now worth more than my work shares. That definitely feels like I’m making some progress on project diversification.