Bristol ERE journal.

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bristoldude
Posts: 61
Joined: Tue May 27, 2014 1:01 pm

Bristol ERE journal.

Post by bristoldude » Mon Jun 02, 2014 6:00 am

Hello from Bristol, UK.
I found ere some time in the middle of last year and thought it was time to stop lurking!

I'm 28, male. a web developer by trade (php mostly) and a keen cyclist and martial artist, occasional rock climber.

I've spent the last few months getting myself back to positive networth, paying off some taxes from an old business and getting myself out of the overdraft. This is the first month I expect to be still in positive net before my salary comes in at the end of the month.

Yesterday I moved out of my city center flat into a room in a nice shared house a bit further out. There's a bit less space in my room, but more communal area and a garden. The rent is £390 including all bills, taxes and some (pretty slow) internet, which is a saving of roughly £200 a month.

This should accelerate me into actually having some savings for the first time ever, I was saving about 40% to clear my debts up to now, mostly by taking the money directly at the start of the month, and living within what i had left. No real tracking up to this point.

Monthly salary is £1,798.03 after tax etc. I’ve been in this job about 2 years now.

I've set up some spreadsheets to track my spending, so I'll try and post that up monthly.

As of yesterday, before the rent went out total net worth was £1603.68
Everything in GBP.

saving-10-years
Posts: 430
Joined: Thu Oct 31, 2013 9:37 am
Location: Warwickshire, UK

Re: Bristol ERE journal.

Post by saving-10-years » Mon Jun 02, 2014 11:45 am

Welcome to another Brit. ;-) I hope that this move works well for you and congratulations on digging yourself out from under the overdraft. Looking forward to hearing more about your plans.

JamesR
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Joined: Sun Apr 21, 2013 9:08 pm

Re: Bristol ERE journal.

Post by JamesR » Mon Jun 02, 2014 6:29 pm

Welcome. How's the PHP demand in bristol? Have you looked at what the average PHP developer salary is there, and how that compares to yours? Might be able to get some raises or apply at another company and get higher starting salary.

Seems like you could potentially get your savings rate up to 70%, curious what your other expenses are like. Are you in bicycling distance of work? Can you get your food expenses down to £100/mo or better?

bristoldude
Posts: 61
Joined: Tue May 27, 2014 1:01 pm

Re: Bristol ERE journal.

Post by bristoldude » Wed Jun 04, 2014 11:59 am

saving-10-years wrote:Welcome to another Brit. ;-) I hope that this move works well for you and congratulations on digging yourself out from under the overdraft. Looking forward to hearing more about your plans.
Thanks! Plans are a bit thin on the ground at the moment. The realisation struck a while ago that if I was working without saving a penny I was either wasting a lot of my time or money.. I'm not sure what the plan for all the time will be when it's not for working.
I'd like to go for a very long bike ride.
JamesR wrote:Welcome. How's the PHP demand in bristol? Have you looked at what the average PHP developer salary is there, and how that compares to yours? Might be able to get some raises or apply at another company and get higher starting salary.

Seems like you could potentially get your savings rate up to 70%, curious what your other expenses are like. Are you in bicycling distance of work? Can you get your food expenses down to £100/mo or better?
I think there's a fair bit of room for improvement of salary. I've been holding off looking for the last few months waiting for the end of a large project that should beef up my CV. I'm planning to have a look around next month.

I am in cycling distance (almost entirely cycle path to the office) and always cycle commute. I don't own a car.

I've been concentrating on reducing fixed monthly expenses for the last couple of months, but social spending (read: alcohol and eating out) has eaten through anything I wasn't transferring out on pay-day. Hopefully committing to track spending this month will have an effect just through paying attention, and then I can optimise further once I've got some numbers.

This month is looking like it won't be great due to paying deposit on new room and some dispute with the old landlord about the amount of the last one I'm due back.

bristoldude
Posts: 61
Joined: Tue May 27, 2014 1:01 pm

Re: Bristol ERE journal.

Post by bristoldude » Wed Jun 11, 2014 11:48 am

Something I've left out of my net worth above is my student loan.

Given the UK student loan interest rate is tied to inflation, and paid directly out of my salary only while I am earning over £15,000 a year, I've always thought of this more like a tax.

It's currently at £12,000, going down slowly.

Can anyone see a reason I'd pay this down early?

saving-10-years
Posts: 430
Joined: Thu Oct 31, 2013 9:37 am
Location: Warwickshire, UK

Re: Bristol ERE journal.

Post by saving-10-years » Wed Jun 11, 2014 1:44 pm

@bristoldude - I don't know the answer but hope someone else does. I'm looking at this from the other end (parent of 17 year old). Have you seen this? http://www.moneysavingexpert.com/studen ... oans-repay

This site predicts that the rate you pay should fall to 2.5% (from 3.3%) from September. So good news for you. But I am a cautious sort of person so any loan at all that I pay interest on is not a good loan. If you are not doing anything with your extra savings that generates more than that 2.5% then why not pay it off? Or at least pay it quicker. Then when you have paid off (say) four years earlier than you would have if paying standard minimum then you can carry on saving only now you are investing that extra.

We had a mortgage when the rate was 15% so this may be age-related scepticism at work here, but things can change in unexpected ways with long term loans. Looking at the fact that the loan rate for new students (from 2012, i.e. people like my son) is RPI + 3% (so 3% higher than yours) and the press has been all about the default on student loans I would assume that the government would change the rules for those with loans at the lower rate if they could. They miscalculated so I would expect them to try to make up for that somehow somewhere. But I am the (financially) nervous type.

bristoldude
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Re: Bristol ERE journal.

Post by bristoldude » Wed Jun 11, 2014 2:57 pm

I started in 2004 so mine's currently 1.5% rather than 3.3%

comes out of salary as 9% of everything I earn over £16k so if I manage to reach ERE before it's all paid off I should be able to stop paying it back..

saving-10-years
Posts: 430
Joined: Thu Oct 31, 2013 9:37 am
Location: Warwickshire, UK

Re: Bristol ERE journal.

Post by saving-10-years » Wed Jun 11, 2014 4:05 pm

That certainly sounds like a fabulous deal. No wonder its now (2012 entrants onwards) 6.5% :-(

What did you make of this part?
...SLC have said the increases are likely to be by RPI in future years too until 2015, when a further decision will be made.

The government announced in the latest Autumn Statement (December 2013) that it's selling off the remaining £40bn of student loan debt it has. It say's this will not affect the terms of the loans, but it's important to understand the government can change rules made in the past.
Are you investing somewhere else given that this interest rate is a bit of a windfall and described as a 'historic low'? I agree that in ERE terms student loans as they stand are helpful in not being tied to assets but to income. Offsetting the new 6.5% rate in my son's case is that our household income has taken a nosedive since I retited so he is likely to get a grant. Unless they change the rules before he gets there.

bristoldude
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Re: Bristol ERE journal.

Post by bristoldude » Wed Jun 11, 2014 4:19 pm

I'm a bit concerned about what's going to happen, but we'll just have to wait and see.

I'm not investing at all at the moment, currently researching and planning to start next month.
Currently looking at a "Dogs of the Dow" style think with UK companies..

saving-10-years
Posts: 430
Joined: Thu Oct 31, 2013 9:37 am
Location: Warwickshire, UK

Re: Bristol ERE journal.

Post by saving-10-years » Thu Jun 12, 2014 1:20 am

If you aren't doing anything then have you checked out some of the current bank accounts that are offering 3%/4%/5% or such? Santander, Lloyds and TSB all have deals which look attractive and you can take heart that your money is doing something while you research. Good luck.

bristoldude
Posts: 61
Joined: Tue May 27, 2014 1:01 pm

Re: Bristol ERE journal.

Post by bristoldude » Wed Jun 18, 2014 11:23 am

saving-10-years wrote:If you aren't doing anything then have you checked out some of the current bank accounts that are offering 3%/4%/5% or such? Santander, Lloyds and TSB all have deals which look attractive and you can take heart that your money is doing something while you research. Good luck.
I've signed up for a first direct account with a £125 cash joining perk, assuming it'll beat the intrest if I can start investing in the next couple of months

bristoldude
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Re: Bristol ERE journal.

Post by bristoldude » Wed Jun 18, 2014 11:31 am

Some figures from the beginning of the year (counting paying off old tax / debts as saving):

Jan
Income: £1966.04 (bumped up by a loan to a family member being repaid)
Expenses: £1234.1
Saved 37%

Feb
Income: £1751.56
Expenses: £1421.56
Saved: 18.8%

Mar
Income: £1998.06 (bumped up by house-mate paying past months utilities)
Expenses: £1399.76
Saved: 30%

Apr
Income: £1749.4
Expenses: £998.58
Saved: 43%

May
Income: £1798.03
Expenses: £1284.08
Saved: 28.5%


YTD 31.5% saving rate

bristoldude
Posts: 61
Joined: Tue May 27, 2014 1:01 pm

Re: Bristol ERE journal.

Post by bristoldude » Mon Jun 30, 2014 1:19 pm

June
Income: £1820.16
Expenses: £1442.95
Saved: 20%
YTD 29% saving rate

% Wise a bad month, many excuses that I won't go into, but a good place to work from.
Quite a few one offs this month.

Some further breakdown of expenses:
accommodation £356.16 (new rent & bills - difference in deposits for flat I moved out of and room I moved into.)
cash £140 (read: probably three way split, groceries, eating out, social drinking)
clothes £68.99 (New shoes)
Grocerys £186.42
holiday £188.98 (The only flights I'll buy all year, promise!)
internet £37.5 (final bill for the old flat)
kung fu £42
phone £7.5
social/eating £69.15
social/music £17.3
takeaway £31.25
transport £40.5
utilities £226.21 (final bill for the old flat, for the last several months)
webhosting £30.99

I think this points to a better % next month with all the one off items removed.
I'm also going to be cutting down alcohol next month for health/fitness reasons, and hope that getting back into a routine of batch cooking in the new house should reduce the groceries significantly and the takeaway to zero.

I've included takeaways and social eating separately as the takeaways are purely laziness and need to be gotten rid of, while the social eating I'm happy with some reduced level of.

bristoldude
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Re: Bristol ERE journal.

Post by bristoldude » Mon Mar 23, 2015 2:03 pm

Well, it's been a while.

This months high spending has prompted me to pay more attention to my finances again.

I'm currently about £5k up, all in 5% paying current accounts.
Clearly I've not done too well since I last posted, I'm hoping this post will be a catalyst for improvement.

Income is currently £1896 a month, which I'm currently looking to increase with a switch from a full time to a contracting role.
I've been struggling with work life balance recently, and come very close to quitting and travelling for a year.

I've decided a contracting role is the way forward, it should allow me to earn slightly more in 6 months than I would in a year, and then allow me to take a few month off for extended travelling. (this might even lower expenses).

bristoldude
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Joined: Tue May 27, 2014 1:01 pm

Re: Bristol ERE journal.

Post by bristoldude » Mon Mar 23, 2015 2:05 pm

Any semblance of a budget is shot for march, but for April I'm going to set myself a £800 limit and see how I do.

It should be able to go lower but that'll do as a starting point

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vexed87
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Re: Bristol ERE journal.

Post by vexed87 » Tue Mar 24, 2015 3:52 am

Hey Britstoldude, nice to see another fellow Brit. Regarding the UK 1998-2011 student loan (which I'm assuming you have), is wiped out 25 years after graduation, if you leave the country/stop earning a salary, you don't need to pay it off. While the debt will grow up to this point, if you stop working and live off your investment returns, you won't be expected to pay. So there's very little reason to pay it off, save for piece of mind.

Also, as interest rates on the loan are so low (1% above UK base rate), currently 1.5%, this is just above inflation, if you pay it off you have lost the opportunity cost of any potential investments. I'd rather have my 9k in a stocks and shares ISA earning me ~6% annually, even though the loan is theory costing me 1.5% at present. Naturally, I never intend to work long enough to pay it back so make the minimum payment, and not a penny more. That is, until the rules change. At least you have the cash in savings to cut it loose, should you need to. Though, the SLC is highly unlikely to change the rate (significantly above the rate of inflation)

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Egg
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Re: Bristol ERE journal.

Post by Egg » Wed Mar 25, 2015 2:57 pm

vexed87 wrote:Hey Britstoldude, nice to see another fellow Brit. Regarding the UK 1998-2011 student loan (which I'm assuming you have), is wiped out 25 years after graduation, if you leave the country/stop earning a salary, you don't need to pay it off.
Bold not true, alas (http://www.studentloanrepayment.co.uk/p ... ema=PORTAL), but agreed there's no point paying it back. I'll probably end up paying mine back because I intend to keep working, but It's one of the few fairly unique advantages Brits have if they do want to ERE.

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vexed87
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Location: Yorkshire, UK

Re: Bristol ERE journal.

Post by vexed87 » Thu Mar 26, 2015 2:43 pm

Someone has been telling me porkies, good to know, thanks Egg!

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UrbanHermit
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Re: Bristol ERE journal.

Post by UrbanHermit » Sat Mar 28, 2015 2:21 am

If you're looking to accelerate your path to ERE, consider picking up some work in the US or Canada at the end of your travels if at all possible.

The going rate for programmers in the UK is SHOCKINGLY low compared to what people with lesser skill sets make on this side of the atlantic. And the cost of living is higher. And the tax rates are higher.

I spent a few years doing dev work in London/Manchester, and while I don't regret it for other reasons, financially I took a big hit to do so. Moving back literally doubled my savings rate. Lots of work here for anyone with PHP skills and a basic working knowledge of Angular, Ember, or Backbone. Pick up some Ruby or Python on the side to position yourself as getting-out-of-PHP and you'll be even more marketable.

bristoldude
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Joined: Tue May 27, 2014 1:01 pm

Re: Bristol ERE journal.

Post by bristoldude » Sun Mar 29, 2015 12:23 pm

Good tips on the student loan, and great to know about the salary gap. I'd certainly be interested to spend some time in the US and Canada.

Currently I'm getting up to speed with Angular, pretty good fun.

Ydobon
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Location: Scotland

Re: Bristol ERE journal.

Post by Ydobon » Sun Mar 29, 2015 2:03 pm

Double check the suggestions re. student loans, it appears to vary quite a bit depending on what scheme you were on. Unfortunately for us Scots of a certain age, it looks like it will be 65 before mine is wiped. Mustn't grumble, the thing will probably be paid off about 20 years before then anyway :)

bristoldude
Posts: 61
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Re: Bristol ERE journal.

Post by bristoldude » Thu Apr 02, 2015 1:37 pm

Income: £2253
£1896 - salary
£71 - overtime
£125 - reward for switching current account to First Direct
£115 - money repaid for train tickets purchased for a group last month.
£30 - selling unneeded possessions
£15 - interest from 5% current accounts


Outgoings: £1863
Rent + bills - £780 (came out for April on the last day of march, so this is for two months)
Groceries £216
Mobile £7.50
Dining and drinking £247.75
Camping trip £53.82
Sleeping bag £155
Kung Fu membership - £42.00
Cycling (new wheels and used panniers) £159.00
Climbing gym - £29.18
cash £75
gifts £49.40
train to visit parents: £24
trousers: £20.19
£2 tax on interest

Savings rate 17%

Quite a few one off items in there, as well as a trip to a conference that meant a lot of eating out and drinking.
Double rent due to a quirk of the direct debit, sorted that to be the first of the month now so next month should look nice.
Last edited by bristoldude on Thu Apr 09, 2015 12:15 pm, edited 1 time in total.

bristoldude
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Re: Bristol ERE journal.

Post by bristoldude » Sun Apr 05, 2015 7:07 am

Conversations with my Dad lead to an interesting proposition around housing, I've posted it up separately here: viewtopic.php?f=14&t=6214

bristoldude
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Joined: Tue May 27, 2014 1:01 pm

Re: Bristol ERE journal.

Post by bristoldude » Mon May 04, 2015 6:33 am

April

in:
£2078
Salary £1,906.29
Expenses refunded £57.50
cashback £7.20
Cash gifts £90.00
Interest income £16.59


out £625

Kung fu £189.00
Cycling £94.71
Climbing Gym £19.82
Mobile £7.50
Groceries £115.05
Stag do prep £100.00
Drinking £22.20
Cash £30.00
Public transport £27.90
DIY £17.04

savings rate 69.9%!

bristoldude
Posts: 61
Joined: Tue May 27, 2014 1:01 pm

Re: Bristol ERE journal.

Post by bristoldude » Mon May 04, 2015 6:44 am

It was my birthday this month, and I spent cash gifts received on some cycling gear, also got some parts for an old bike I'm refurbishing.

averaging out the last two months gives a savings rate of 43%

Went over budget this month due to paying for things in may, a kung fu training weekend and the deposit for a friends stag do. those two will probably also make may quite expensive, so I'll try to keep a lid on all other spending.

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