negative savings november update :(
Duck. Chillin
You’ve probably noticed this has been a very slow monthly update to get out, and the reasons are twofold. The first is that I’ve been ill for about 5 weeks running and have been very run down (on the mend now though finally which is good timing for the Xmas break!). The second is that we had a terrible, terrible month on the savings front and so motivation to put this out into the big wide world of the dub-dub-dub has not been all that strong!
Anyway, it happened, so here it is. I’m not actually that down about it as most of the spending is relatively justified, and I just happened to have a terrible month on the matched betting front which failed to cover the extra spending.
expenses
Let’s start with the ridiculous amount of wodge we blew last month! It was £3969.31 this month which is our second highest month of the year and puts us up to an average of £3089/month.
A non-exhaustive list of November expenses included:
- Mortgage £1187 – The mortgage payment lord takes with one hand (September, £1448), giveth with the other (October £268) and then bloody well taketh again with it’s weird and freaky third hand this month. This pretty much evens out the payments at our normal rate over the 3 months, so it’s no big deal, I guess it’s just taken them a while to figure it out. The next month should be back down at the usual rate of just over £800 and stop messing with my monthly expenses!
- Groceries £440 – Our highest grocery bill all year coming just at the wrong time. We have been stocking up on stuff (booze) for Christmas which partially explains this one.
- Clothes £120 – Hmmm. Not too bad I suppose.
- Holiday £121 – Had to pay for an extra nights stay for our holiday/friends wedding in Dubai early next year. Hotels in Dubai are expensive!
- Going out £479 – Mrs T’s silly season started a bit earlier so she was out quite a bit last month, while I’ve taken over the baton this month. We also had a few meals out catching up with friends.
- Tickets £171 – We bought tickets for an in all honesty very pricey Derren Brown gig, plus something else which I can’t remember. Hopefully it will be worth it (normally is with Mr Brown!)
- DIY etc £437 – I decided to build a bespoke shelving unit during my two weeks off in November which turned out great but was fairly expensive in the end. Still, a much better result than buying some crap flatpack unit from Homebase! Costs spiralled as project scope creep ensued and I ended up not only repainting the whole of the hallway but building a shoe rack as well. See pics below!
- Christmas & Other gifts £326 – Got most of our Xmas shopping done early this year plus we have a lot of birthdays in November to contend with as well, so yet again high expenses all round.
- Golf £122 – A final hurrah before I take a month or two off when the weather is at its worst!
- Children £67 – Baby T continues to be far more frugal than her parents! 🙂
Remember if you want to look at the full figures or copy my spreadsheet to use/modify yourself just have a look at it here: my awesome spreadsheet. Note: You can use this yourself, just copy it and then edit your own copy by going to File -> Make a copy OR File -> Add to my drive OR File -> Download As (then select a format to download as).
Shelving unit area before and after
And another angle
The horrendous mess that was our shoe zone before
And after! 🙂
income
Another poor month for income with only £3175.11 making it’s way onto the fun side of the balance sheet. This was seriously compounded my my epic Matched Betting Fail and I did well to even turn a profit in the end on the month.
A non-encyclopedic list of this months income:
- TFS salary £2204 – My first month including the recent pay rise. Yay! (Although I am working more hours for it. Boo!)
- Mrs T maternity pay £547 – Well I thought last month was the final one but apparently there was one more. A nice surprise!
- Matched betting / Secret Side Hustle £270 – As mentioned I’m quite happy to even turn a profit here. I chucked some value betting into the mix as well this month and a few of those came in which turned a decent profit, although got me banned from Coral 🙂 – If anyone is interested I use Odds Monkey matched betting software (<–affiliate link) for this, which having tried a few different ones out there, I found to be a far superior product in pretty much every way to everything else I tried. Check it out if you are new to matched betting, there are loads of great tutorials to get you going and you can try it for free.
- Ratesetter £55 – This included £5 worth of interest and £50 referral fees from this post I wrote. Cheers to the lone ranger out there who signed up, much appreciated! If you want to sign up and take advantage of the £100 sign up bonus which is still ongoing, use this link here (<– obviously it’s a referral link!) or read my post on it for more info.
- Child Benefit £82 – Bwaabwabwaa-bwa bwa bwaaah bwaaaa!! (I thought I’d give you a direct quote from Baby T on that one. I have no idea what it means either but she sounded very excited about it)
savings rate, net worth, etc
As mentioned in the post title we hit a lovely negative savings rate this month of -12.59% which brings our average to 36.96% for the year.
December should be a less expensive month but there have already been a few unexpected expenditures which in all likelihood mean we’ll miss the 40% savings rate target, a shame but good to run it so close. By my back on a fag packet calculations to hit it I’d have to make about £3000 in matched betting and only spend about 1K for the month (or similar) which let’s face it, ain’t gonna happen!
A very slight nudge up for Net Worth this month:
Excluding house equity: £127,838 / +£240 / +0.19%
Including house equity: £204,355 / +£700 / +0.34%
Liquid Freedom: £59,425 / -£186 / -0.31%
Please note these figures are not from the end of November as I was extremely lazy and only sampled the investment accounts about 3 days ago, so probably won’t be much movement on the investment accounts next month.
other updates plus Xmas FI London meetup
Haven’t updated my alcohol intake in a few months so here are the last 3 to catch you all up:
- September: 30.74 units/week
- October: 30.94 units/week
- November: 17.62 units/week
As usual, a little on the high side compared to what I’d honestly want.
I will do some of the usual end of year updates in January, look at how accurate our 2016 budget was and also attempt one for next year. I’ll try to make these updates a bit more visual this time round and so will include more graphs, one of which will plot my alcohol intake with total spend each month, as I have a theory that these are highly correlated 🙂
Talking of beer… there is another Financial Independence London Facebook group meet-up up this Wednesday 21st December (i.e. tomorrow!) which I am still 50/50 on going mainly due to still feeling a bit under the weather. If you want more details feel free to drop me a line or it would probably be far easier to just join the facebook group yourself if you haven’t done so already.
I’ve managed to do one short training run for the marathon which is poor but yet again I’m blaming being ill (and otherwise busy!) on this one. Looking forward to getting back into it over Xmas and into the New year though! Out of my other procrastination post tasks to attend to, I still haven’t done my tax return or any of the promised blog posts but we have sorted through the photos, which unsurprisingly turned out to be a very enjoyable task seeing how baby T has grown and developed over the year. More importantly on the marathon front I’ve started fundraising as I need to raise £700 by the end of January and £3000 in total, so good to get cracking on that one! I was toying with the idea of posting my virgin giving page on here to try to bump up the sponsorship a bit, would anyone be offended if I did? Let me know your thoughts on this one, thanks!
And that…. was my November!
How was yours?
All set for Xmas?
Overspent on presents or do you run a tight ship all year round?
Discussion (32) ¬
Hi TFS,
Sorry to hear you are unwell, but sounds like you are at last on the mend now which is a positive thing!
Don’t beat yourself up on one months overspend (on seemingly justified things) – these things do happen, and be thankful it wasnt as bad as mine, and December isn’t looking much better!
The main thing is you still have a corking savings rate for the year, way above the majority of the population!
I am not sure I want to know what my alcohol intake has been this last month but I am sure it would be bad – good luck with the training when you are back on your feet!
Cheers,
FiL
I guess thats the rub isn’t it.
Most people think all of their spending is justified otherwise they presumably wouldn’t be doing it.
Did we really “need” me to build a new shelving unit etc? Probably not. But on the other hand if I’d paid someone else to do it I reckon you’d be looking at a grand in tradesmen fees. So it feels justified in that sense.
True about being above average compared to the rest of the population but can’t help comparing to the rest of the FIRE community in which case it’s pretty poor. However… as I probably say ad nauseum, I am working part time and Mrs T is on maternity leave for 10 months of the year, so if you frame it like that I reckon we’re doing pretty well.
Cheers and hope you have a nice break over Xmas if not from the boozing at least from the working 😉
Hey TFS,
Well thats a very fair point – although I know that some of my spending isnt “necessary” but it is part of my lifestyle choice – I guess that is my way of justifying it!
The new shelving looks awesome, and I think you would probably have spent quite a lot more getting a tradesman in to do it – I am just jealous of your DIY skills!
I think that is one of the hard things – comparing yourself to the FIRE community, as with almost anywhere else, there is always going to be someone better than you, be it running faster, earning more, higher savings rate etc. The main thing is to not let it get you down – and as you say you work part time and Mrs. TFS is on maternity leave, so its actually pretty damn good. To get a fair comparison maybe do an exercise to put your salary up to what it would be if you worked full time, and see where that would put your savings rate!
Hope you had a great Christmas break with the family as well!
FiL
The comparison game is a dangerous game to play eh! This counts for who has the latest iPhone/Car biggest house and also with savings rates!
However at least the latter can be motivational and positive whereas the former is usually just a downward spiral into jealousy and one up-manship.
Xmas break was awesome thanks, hope you had a good one too!
P.S the meet up is tomorrow, December the 21st not today the 20th 🙂
FiL
Thanks for the spot! I’ve updated, but hopefully people will have got the correct date as I mentioned Wednesday. Cheers again
Marathon fund raiser – I’d be inclined to stick it on the next blog – I don’t personally sponsor the odd 5K or 10K, but marathon distances are something else !
Hi Mick,
Thanks for the input on that one. I guess I have nothing to lose by posting it up ay, so yes I think I will do it!
Cheers!
That’s some epic expenditure there, TFS, but it’s just the combo of silly season and that bumped up mortgage payment.
If not for your bad matched betting month, you would have covered the expenses AND had a positive savings rate – it’s not like it’s the norm for you to spend more than you earn, so yeah, just put it down to that time of year!
Very impressed with your DIY – well done, the before and after pics look great!
I hope the Xmas FI London meet up went well and that you were able to attend. Huw is trying to organise a FIRE meet up in the new year but I don’t think I’ll be able to attend.
Anyway, let me take this opportunity to say hope you have a very merry Christmas and all the best for 2017!
Hehe, well thanks weenie!
Yep just put this down as one for experience and crack back on in the new year (December should be around 0% I reckon but hey you never know)
I’m going to give the meetup a miss which is a shame, but still under the weather and my wallet could do with missing out on it as well. Sure there will be plenty more meetups next year to attend though!
Yes I saw Huw’s post, I have yet to reply but we are a firm “maybe” which probably doesn’t help him much… haha.
Merry Christmas to you too, and a have a blast in Hong Kong over the new year!
Nice shoe rack…I’m working on plans for something similar of the Christmas break!
Cheers UTMT!
I’m giving myself a few months off the DIY now to enjoy the fruits of my labour (and train for the marathon!).
Good luck with your project, and hope to see some pics on the blog 😉
Nice shelving! And I just noticed the notches cut out of the shoe selves for boots. Very clever! I look back fondly on my week off of work when I built a big set of bookcases. Looking to do something similar for our closet one day.
Thank you Norm.
Can’t beat the satisfaction of looking on it and seeing a job well done, makes all the hard graft worth it.
Not sure I could do it day in day out though!
Hope you feel better FIREStarter. You sure there is no correlation between the silly season, the grog related grocery bills, the increased alcohol quotient, and and feeling rough over that same period? Suspicious 😉
Great job on the shoe cupboard, don’t let my wife see that or she’ll have you taking on a side hustle building custom cupboard interiors!
Hi Slow Dad
I think you might be onto something there 😉
Haha cheers, have to admit it was something that crossed my mind for a side hustle although I feel I’d need a bit more practice first before having the cheek to charge anyone for my services
Re: your mortgage payment, if I’m interpreting what you’ve done correctly (I may not be as I haven’t studied your methodology) wouldn’t it make more sense just to treat the accrued interest portion of it as an expense? Otherwise you’re penalising yourself rather unfairly by including capital repayments as part of your spending rather than saving, which is what it really is. It would also make the figure completely consistent month-to-month as the interest payment would remain the same (except where you remortgage month to month of course). Your capital repayment portion is just another form of saving, and probably one of the better ones in today’s crappy yield world.
Hi Alistair,
Sorry I don’t think I explained it very well, the extra amount this month wasn’t an overpayment of any sorts it was just how the mortgage companies decided to charge varying amounts as they sorted out the changeover from one to the other. (Sorry if you already got that part just not sure if I made it clear).
In terms of only including the interest as a cost, yes that could be an idea and one that I’ve thought about before here:
http://thefirestarter.co.uk/calculating-savings-rate/
and here:
http://thefirestarter.co.uk/conclusive-proof-house-included-net-worth/
To be honest, I never got round to completing my analysis of the figures and couldn’t get a decent way of including the payments into a savings figure. Needless to say it wouldn’t move the needle on anything over about 20% savings rate by much anyway so I thought it would be easier to just not include it in savings rate figure and count as an expense.
This way it builds in a nice bit of a safety net into the “Years to retirement” figure, although obviously may have you working for a bit longer which isn’t ideal. I think once I get nearer to the time I will have another look at it and just work out, can I retire now and clear my mortgage (if it still exists) and just go from there.
Hope that explains my thinking on it a bit clearer.
Cheers for the interesting comment 🙂
Oh Yeh Sheffield Park – I have a lot of photos of that duck and her friends.
Hehe, it’s a lovely place isn’t it Danny? 🙂
Yes please provide the Just Giving link. A bit of sponsorship cash is more than a fair exchange for the content of this blog, especially your spreadsheets. Still trying to get my head around some of your spreadsheet calculations (no idea what sweet spot mortgage is for example) but very useful nonetheless
Ah thanks Ray. It’s nice how kind people can be to effectively internet strangers. I’ll post it up on my next post. Cheers!
Haha… I can’t even remember what that means?! I’ll check it out and get back to you!
Much agreed with Ray here – I already have a RS account so no referral from me, happy to sponsor though (you could put it on the FB page if you really feel it would be poor taste to post it on the blog).
Thanks JS.
Not a bad idea about the FB page, I did think of that too actually but thanks for giving me some conviction that it was an OK idea to do that.
Cheers!
Hi again Ray,
OK I’ve had a quick look and assume the spreadsheet you are looking at is this one:
https://docs.google.com/spreadsheets/d/1SSWN8imHowJocth6OYoOyu8RTcSmwVSncsy2eAiybNQ/edit#gid=6
So I have updated Scenario 4 with a rough estimate of my (or I should say “our”) income and mortgage figures to provide a real world example.
Basically you have to put your figures in and then play around with the sweetspot mortgage figure until the two rows below it show the same figure.
I could never work out a nice neat formula for calculating the years to FI by just sticking in your mortgage payments so this was the best I could come up with.
It’s basically saying, your mortgage payment is not going to be an expense you will have to pay forever so we shouldn’t include it in your expenses forever, but until it’s paid off it IS a real expense and maybe you will FIRE before you pay it all off. The sweet spot mortgage figure can be anything as long as the two rows below match up, and this is your new and real Years to FI which takes into account your mortgage.
Below that is a row Difference YFI which shows you how much earlier you can FIRE by taking the fact that your mortgage will be paid off at some point, rather than just thinking that your expenses will stay at that rate forever.
A few extra things this does not take into account:
1) That your mortgage payments will be eroded by inflation over time. Which if anything should help things even further (but probably quite minimally)
2) I didn’t put in a row where you can put in your current Net worth which is a bit annoying! Because it’s currently saying I have 21.26 years to FI, which I know is not true as I am not starting from Net Worth of Zero!! 🙂
Maybe I need to spruce that one up a bit for the new year and make it more clear what each row is for.
Cheers!
Ok, I still need to do a bit more reverse engineering on the calculations to make sure I am comfortable that they are meaningful, but now I know how to use the sweetspot mortgage figure it seems to make some sense. The number itself doesn’t seem to correlate to anything as I understand it.
In my example I want to see what things look like if I try to pay off my mortgage in 10 years, so I put “10” in the “Life of Loan” row. Now to balance the numbers using the sweetspot mortgage, I need to put a big negative number (-175,000) for the sweetspot mortgage. If I put the actual life of the loan (around 30 years) then my years to FI is much longer, which I think makes sense as in the 10 year mortgage payoff scenario, I am putting a lot more money away each month. Whether the number of years that this theoretically chops off the years to FI is correct or not, is the bit that I need to put more thinking in to!
Hi Ray,
It definitely needs more thinking, I made that spreadsheet at least 2 years ago I think so even I am finding it hard to work out what I was thinking to be honest!
Hopefully I’ll get time to work out exactly what I was doing with it and do another post explaining what means what properly this time around.
Cheers again, and if you have any revelations yourself about the calculations, or have made any decent amendments to the spreadsheet feel free to share them on here or drop me an email via the contact link above.
Nice work on the DIY project FIREstarter. Maybe the costs did spiral upwards a bit on this project but for every pound you put in, you probably add 10 to the value of your house so it’s not lost is it.
Sorry to hear you’ve been sick. Wow, 5 weeks is a long time to be ill. I’d be getting to the point where prayer would become normal. God, please make your mind up. Either make me better or kill me. Don’t leave me half way any longer.
At least you’re getting better for Christmas so you can make yourself ill again, albeit, in a far more pleasant way. Have a good one matey and catch you back here in the new year.
Thanks Martin,
All the best for Xmas and new year!
Cheers
Hi there,
I discovered your site recently and have enjoyed reading your posts. I signed up through your Ratesetter referral link so consider that my Happy New Year tip to you!
Best,
Niall D
Hi Niall,
I have received the bounty in my Ratesetter account already!
Many thanks, tip greatly appreciated and glad you have enjoyed reading the posts.
Happy new year to you as well 🙂