Yet Another Dane

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BadHorse
Posts: 55
Joined: Sun Jun 05, 2016 4:17 am

Yet Another Dane

Post by BadHorse »

A journey of a thousand miles begins with.. finding the friggin' direction
Hello everyone, glad to be here, among other people who prefer spending less and living more.

I hope this place may help me find some of the inspiration and information to finally get my act together and make an actual financial plan for my life.

ERE won't be very E for me.. I'm already 38, with some very poorly invested savings. Basically:

855,000 dkr in a horrible bank-managed investment fund (about 70% bonds, 25% stocks, large fees that eat up any earnings).
200,000 dkr in a bank account with no interest
(also some actual pensions, but these two are the ones that stress me out)

So what's holding me back??
Well, I know the investment fund is horrible, so I'm loath to put my cash there... and I'm not sure whether I should change the investments for long-term profits, short-term in case I need/want to buy a home, or even if I should just go ahead and invest it all in a rental property. Argh.

So that's the sorry tale.. I may not know the direction yet, but I hope this is a first step to find the compass at least.. ;)

cbroenning
Posts: 27
Joined: Sat May 21, 2016 3:14 pm
Location: Copenhagen, Denmark

Re: Yet Another Dane

Post by cbroenning »

Welcome!

Nice to see "yet another dane" :) You definitely wont be disappointed by your first step towards financial independence. I just recently joined and it has definitely given me a new approach, seeing expenses in the light of overall plans and strategies.

Even though its not E, you are not starting from scratch. Assuming you don't have a lot of debt, you have a net positive balance sheet and that means something to work with.

For investments, there are quite a lot of choices on paper. However, Danish tax law heavily influences your net result and should be a key driver in terms of choice of investment. Depending on your choice of investment and your situation, finance options etc., you should consider the utilization of tax schemes such as "virksomhedsskatteordningen" or even setting up a company.

What is your background?

/C

FBeyer
Posts: 1069
Joined: Tue Oct 27, 2015 3:25 am

Re: Yet Another Dane

Post by FBeyer »

BadHorse wrote:...
ERE won't be very E for me.. I'm already 38, with some very poorly invested savings...
I'm 34, got 170.000 in student debt, 45.000 invested, and 130.000 outstanding loan with a family member. You won't be last to cross the finish line unless your annual expenses are through the roof. I'll be making under median pay for at least two more years before I get a real paying job, so don't worry.

I've relegated myself to the thought that I'll be retired 23 years more than my peers at least. My primary focus now, since I realized that I will become FI come hell or high water, is to not go insane while I get there. The time frame doesn't matter as much as my mental health. I will not waste 8 years sweating over spreadsheets if I could spend 12 years enjoying myself.

We have a 'local tax expert' on these boards who advises to put the first 50.000 or so (up to the max) in your Ratepension first, and only save for iværksætterordning or equivalent in case you actually do intend to start your own business, and in case you're still paying topskat after putting 50K in your ratepension. There are few things that will give you deductions from the top tax bracket, so getting to know the tax code is worth a lot of money.

BadHorse
Posts: 55
Joined: Sun Jun 05, 2016 4:17 am

Re: Yet Another Dane

Post by BadHorse »

Thanks, cbroenning and FBeyer :)

Yes, I definitely need to read up on taxes.. I’m “lucky” in that I don’t need to worry about the top tax bracket though. :roll:

My pay is definitely under median (maybe under quartile?) for someone with my skill set (data crunching), but I like the job… Boss is good, colleagues are great, I get to do something useful and learn interesting things, and I laugh every day. That’s worth a lot, even if it delays FI.

I guess I should start a journal with all the numbers.. I’ll definitely be reading yours for inspiration!

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