Great job but... A Danish FI journal

[Bonde]

Hi all
I have been wanting to start a journal for some weeks and have hesitated to start. Now I just jump into it without overthinking and planning every small detail.

About me
Turned 33 two days ago. Lives in the mainland (Jutland) of Denmark. GF and I bought a house with 12,5 acres of farmland close to her parents. One hour drive from my workplace. I'm adopted and came here when I was 6 months old. My parents raised me in the Danish culture and I dont speak my native language or know much more about the country than the average joe. Personality wise I am both outgoing and enjoy evenings on the couch. I have done a personality test a few years ago but cannot remember the results and don't care much. I think that test dont capture the complexity of our being in the world.  

My life notes
- Childhood was great. Grew up with mom, dad and sister (5 years younger, also adopted). I think that we were middle class, maybe in the lower end but never felt like it. Had all that I needed and lived in a small town where everyone knew each other. Every fall we would go one or two weeks to the Mediteranean. For around ten years we went to the same place in Malta and stayed in the same bungalow. Lots of fun memories from then. My mom and dad worked odd jobs to afford those holidays and got paid in cash (avoided tax, normal in Jutland in that time period). As regular jobs my mom was managing a kitchen at a nursing home. My dad was a carpenter and sold kitchens. In a way we lived frugally but it never felt like it. My grandma owned a farm and we got lots of meat from them and my dad fixed up our house mostly by himself.

- Problems started when I was 10-12 years old and my mom started drinking too much. She hid cheap white wine in the kitchen. From the outside everything seemed fine. During the day she would work and was her normal self but she started to drink when she got off work and it was hell in the evenings. I think that was the main reasons for my parents divorce when I was 17. My dad moved away and I cooped by playing computer and focusing on school and friends. Alcoholism had a severe impact on our family even that I dont think my mom drinks today. I'm not that close to my mom and sister. We text less than once a month and only see each other at holidays/birthdays. 

- My dad died New Years Eve of 2019 after one month with glioblastoma (brain cancer). It was very traumatic but I grew closer with my stepmom and sister. The sorrow is still a part of me but today it is mostly a reminder of my limited lifespan, that every day is precious. Bonde is my dad's middle name.

- School was easy for me. I went to a high school that focus on business and thought I would study economics. Retrospectively I think that I equalled money to happiness. During high school I watched Zeitgeist doc and grow tired of capitalism. Didn't see any meaning in a cooperate job. So after high school I was in an existential crises until I read Lone Frank's book about neuroscience. I wrote to a student council to ask what to study to work in neuroscience. I contemplated philosophy, psychology and medicine. Chose the latter after an internship at a Dept, of Neurology where I assisted phd-students. Got some great advice from them and I liked the low unemployment rates in medicine and the endless possibilities in other non-neuro specielties (combating the anxiety "what if neuro is not for me").

- Med school was some of the best times in my life. Met lots of interesting people and I got interested in psychiatry. Started during research and published a peer reviewed paper. Was also active in student associations.- During med school I lived in a dorm with shared kitchen and toilets/bathrooms. I met my best friends there. It was also cheap and I could live of my student "salary" provided by the public sector.

- I graduated in 2016 and today I am less than two years from earning a specialist degree in psychiatry. I have published several papers and seek funding for a phd. Though the phd would prolong my specialist degree with 3 years but I will enjoy the time to focus 100% on research. Up till now I have had, in some periods, 20% research time on paper. In reality it is maybe 10% as clinical stuff of course has a high priority. I enjoy the clinical work, diagnosing and treatment is always very individualised and I get to know the patients quite intimately. The ability to treat or ease their mental pain is very fulfilling. 

- I can't remember exactly when I became aware of the environment and climate change, probably in my two gap years after high school. Since then I have basicly been frugal because of my economic awareness (spending => polution).

- I met GF in 2017. She is my closest confidant and makes me happy. We in many ways want the same life. Dont care that much about norms and prestige but want to be happy, enjoy life and care for the environment. I think that we for example both find gardening interesting and also practical, a way for us to put food on the table.

Finance
A few days ago I talked to GF about when our interest in FIRE began. We cant remember exactly, maybe in the end of 2020 after we bought our house. In spring I read the ERE book, took notes but only made the exercises in my mind, wrote a little about in my personal journal. Overall the book and this forum gave my lots of good inputs to my thoughts on FI.
I have always had plenty of money on my account. Most of my teenage years I had a paper route or other small jobs. Before I turned 18 I played poker on a fake account and won a few thousand dollars. After I turned 18 I won even more and lived of poker during my gap years and had a very good amount save going into med school which mostly remained after graduation. 
In 2008 I invested in some funds recommended by my bank and lost. Since then I have been aware of the risk and have kept all of my funds in cash as I saved up to buy a house. We bought the house during the covid crash and felt good about not investing. We paid 20% cash and took a cheap loan with 1,8% total expense rate. It is paid off in 30 years.
I have made a spread sheet with our FI goal and our way there with different saving rates and market return rates. It seems like we can be FI in 8-12 years.
Our budgetted savings rate for 2021 is 45% due to a psychotherapy course that I pay for myself. In 2022 we aim for a 65%. 20-25% of income go to house mortgage and is by far the biggest post. It could maybe be 15% if we lived in a cheap apartment but the upside for us living here makes it worth it. Currently we have invested around 7% of our FI goal in index funds. We use a dollar cost average strategi and atm we invest 1% of our FI goal monthly. That is due to a large cash holding after buying the house which ended up cheaper than expected. In a year it will go down to 0.75%.

I am not sure how much in detail I will write here because of privacy and I think that a more abstract look at it is a better exercise for me. There is so many unknown variables e.g. if I fund money for a phd then I will likely get a minor paycut and my specialist pay raise will be delayed for three years.
It could be interesting to count our expenses in JAFI.

Why FI? I love my job but maybe
- Danish public healthcare will be so underfunded that it will affect the work environment and make me want to stop. Burnout is probably the greatest risk. I have seen some of my older colleagues struggle with it and some have left the hospital
- I would like to spend all my time with our future kids
- I want to become a full time environmentalist/activist
- AI will make me irrelevant. I don't think it is very likely. Especially when I also am trained in psychotherapy. I think it could be good to have the financial freedom to set up my private clinic and only charge a small amount. That could be a form of barista-FIRE.

Goals
- Update journal every second week
- Quarterly financial update
- Short workout 5 days a week
- Consistent 8 hours of nightly sleep
- Work/life balance. Keep attention to hours, when I'm too tired to work and better planning and executing
- Better gardening skills
- Work on other streams of income

5-6 years ago I got a simple advice that I have tried to live after. Norman Sartorius, a living legend of psychiatry, said in a leadership workshop that one should use 15 minutes every day to think about one's goals and if you were headed in the right direction. I dont do it enough but have kept a journal for the past five years and overall try to keep in mind where I want to go and how to get there on all sorts of levels and timeframes.
I look forward to share my thoughts here.

[Alphaville]

welcome to the forums, that's an interesting profile.

i'm sorry about your losses, old and recent, but i also appreciate how you integrate them as inspiration for what drives you.

i agree with your emphasis on privacy and no doxing--especially given your profession.

and yeah, nice to have a real psychiatrist among the members--and glad to see someone else who shares my skepticism of personality tests (i can be a bit militant about this)

anyway, looking forward to reading your journal.

[Andy Dufresne]

Velkommen!

Academia is always a possibility - you will get paid to do research (which you seem to enjoy) and you can build a private practice (assuming this is a viable option in DK). I think most ppl have misconceptions about psychiatrists so it will be refreshing to have one here

[Green Pimble]

Welcome to the forum!

Your journey to FI sounds like it will be rewarding, and I am glad to hear you enjoy your work. I think enjoying your job makes becoming FI that much easier, because there is less pressure to just "get through it".

I am also a doctor, but living in Australia. I would love to hear your opinion on the Danish healthcare system sometime. I have dreams of one day learning Danish and moving to your lovely country .

[Seppia]

That's a very intricate backstory. Welcome to the forum and I look forward to reading your journal.

[Frita]

Welcome and thank you for sharing some of your backstory. It is scary when someone finds you, especially depending on the person.

I find it interesting that you are interested and willing to spend the time/expense for a complementary PhD instead of pushing big pharma. (Perhaps this is just me being cynical looking through an American lenses.). Looking forward to following along.

It is interesting the profound nuggets that stay with us. I can think of two:
1) Marriage and family undergrad sociology course: “The best thing a father can do for his children is love their mother.” Dr. Mueller
2) Sometime in post-grad: Look at your values and how you spend your time. Are they congruent? Ask yourself every day. (One woman, the most career-oriented one, literally quit and became a full-time mom. Years later she was still happily doing that.)*

* This one seems similar to pondering one’s goals and if headed in the right direction.

[Frugalchicos]

Welcome to the forum Bonde, very interesting life story.

"I would like to spend all my time with our future kids" - Having time and being able to afford to do whatever you feel like at any given moment is the ultimate freedom. Being frugal and setting goals will get you there sooner or later.

[Bonde]

Thank you for welcoming me. Your words are very encouraging.
I have enjoyed the forum for a couple a months before signing up. I have learned a lot from journals and other forum topics and look forward to contribute to the community.

@Alphaville
I took a personality test a couple of years ago and got INFJ/advocate. It was nice to be compared to Mandela and Mother Theresa (+Maria Kondo haha). I know mostly about it from a disorder perspective. The diagnoses for personality disorder are changing to a dimensional approach and consensus is that the diagnoses were too categorical. My psychotherapy course is psychodynamic/psychoanalytic and I consider our self to be dynamic, evolving and changeable. To me the personality tests seems quite simple. Categorizing can both be helpful but also hurtful e.g. if the test make you keep the same patterns and don't try to change.
I will look more into it in another post.
https://www.16personalities.com/infj-personality

@Andy Dufresne
Thank you for the advice. I think it could be interesting for me to write down different career paths. Academia+private clinic is a good option. Though health care is public funded and if you want to work privately for the public system you have to follow their guidelines (e.g. max number of sessions) to get paids. The market for self-paid therapy is unknown for me but I think there will be a decent amount of clients willing and able to pay be themselves. Most therapy in the public sector also requires a fee, I think it is about 500 DKK which still could provide a sufficient salary for myself without public funding.

@Green Pimble
I have noted to write about Danish healthcare
In short, I will recommend working here. We have 37 hours of work per week, salary is maybe a bit lower than other countries but the public sector takes care of a lot of worries e.g. support kindergarten, school etc. My impression after talking to international colleagues is that our work burden is a lot less than many other places. Of course it depends on specialty and location.

@Frita
Concerning big pharma. I have written some up-eds with a student org. about the problem. In short I think that the system is dysfunctional e.g. because drug development is supported more than public health prevention, the prices of drugs is soaring and big pharma use a lot of money on lobbyism. I might write more about this topic as it is a interesting topic. It usually starts a discussion when I state my loath to the patent system.

@Frugalchicos
I consider myself in a very fortunate situation. We have already a saving of 2-3 years of annual expenses so we can take a sabbatical right now if we want.
In ERE terms I also see myself as a possible working man. If I leave my current job I could easily support us by working vacancies in Danish (or even Scandinavian) psychiatric wards. I could also work in other departments as I have experience in both family (GP) and emergency medicine. It will take a bit of reading in my old somatic books and looking up most recent guidelines.

[Bonde]

Shocking few weeks.

I have been taking two courses in other cities and stayed at a friend's place and a hotel. The hotel was paid for by my employer and I went to restaurants two evenings with colleagues. We pay ourselves for dinner but get a deductible that will cover some of it. I spend a bit more when going out than eating home, usually 200-300 DKK incl. drinks per evening. I will share numbers in an upcoming post after GF and I have counted income and expenses for Q2.

When driving home from one of the courses, I treated myself with chips and ice cream when the car was fast charging (Hyundai Ioniq, 28kWh battery) and decided to listen to Denmark's first football match in the men's Euro Cup. I don't follow football but the national team is something special. So I ate chips and ice cream on my way home while listening to the game. Had a good time. Then the Danish star Christian Eriksen suddenly fell without any reason. The commentator said that I look weird and not good. A lot of medics surrounds Eriksen and I think that the commentator said that they started CPR. Then they played music because ethically could not commentate any more. I was shocked. What just happened? The world wide transmissioned event went from enjoyment to lifesaving treatment in a matter of seconds. I called a friend that watched the game and he kept me updated but could not say much because the cameras were turned away. Eriksen was carried out of stadium and rumours said the he was awake. After I came home it was announced that he was OK and the game was resumed but the rest of the game was not about football. The players were clearly in a state of shock. UEFA was later critized for giving the players an impossible decision. Play now or play tomorrow at noon. The players decided to play now because they knew that they wouldn't get any sleep. The game should have been postponed indefinitely and it seems that UEFA cared more about protocol and scheduling (broadcasting/money) than the players' mental state.
Denmark lost 1-0 and also lost the next game against the top team Belgium after they got an surprising early lead in the first half. They had to win their final game in the group stage of the tournament. I went to a large screening event at a stadium to watch it with some friends. What a wild evening. Denmark won 3-0 and Belgium also won their last game helping us moving on to the knock-out rounds. The stadium went crazy.
Yesterday GF and I drove to the stadium for another screening event and watched the next game against Wales. What a game. 4-0 and it was total madness. For each goal our hair got washed up with beer. You can see a clip from stadium here: https://www.dr.dk/sporten/fodbold/em/ha ... rsejr-over
Eriksen has been discharged from the hospital, got an ICD (Implantable Cardioverter Defibrillator) and is apparently without any severe injury after the heart failure. It has not been announced if he will play pro football again. A few other players are playing with an ICD. As a positive note the event has given a lot of publicity to the importance of instant CPR and how to handle mental trauma. The players have been very open about their feelings and all the help they have received from psychotherapists.

When I got home during the first match, another shock came as I saw the frame of our tunnel greenhouse next to our barn, about 100 meters from its origin. The plastic had been removed. Apparently the wind took it and it flew over the field, about 300 meters before it was stopped by a hill. GF and luckily a few friends were visiting carried it back to our house. We had not secured it to the ground because it look stable and we did not think about the wind. The next day we used a some hours to get it back in place, put soil all around it so the wind can't get under it and secured it with large rocks on the frame. The frame it intact but the plastic has some big holes that we have mended with tape.
It was a scary lesson to learn and it took hours away from other gardening projects. We have not been able to plant as many veggies as I expected. It is discouraging that it is impossible to catch up since the Danish growing season is rather short. I have lowered my expectation for this year and we will have to prepare more dying winter for next year. When time is sparse 15-30 minutes of picking up snails ends up taking a good share of the time to plant new crops.

Quick notes on goals:
- Workout has been a lot of basketball. I enjoy playing by myself and there is a court on the hospital ground that nobody uses. I also do some allround exercises. I have done 5-6 times a week for 10-20 minutes without counting strenuous tasks while gardening.
- Sleep has been a challenge. Many days only 6-7 hours and then a nap when I got home from work. Need to work on that. Be more disciplined to get to bed early.
- New goal: less browsing. I use too much time on facebook and other fora. I have been reading more on ERE, got lots of inspiration from other journals. But I aim to use less internet overall and instead focus my time.
- Work/life balance: Problem is also that my work is not so productive. I will try to take breaks from the computer instead of browsing doing work hours.

[thedollar]

Hi Bonde. Thanks for sharing your story. Fellow dane here - will be following - both your journal and the euro cup - with excitement !

[Bonde]

Lesson learned. Remember to save posts in doc before submitting on the website. Lost and entire entry due to the site wanting my to login...

Annualized budget


All numbers in DKK (1 USD = 6.3 DKK).

Some comments to the budget:
I think that we're in between the normal and lean budget atm.
- Mortgage is fixed for the next 29,5y at a good rate of total exp = 1,9%. After that the loan will have been paid off.
- Other house exp includes insurance, wood pellets for heating, water, power (excluding power to the car), and taxes. We could maybe reduce a bit of heating and get a better insurance deal. Around 50% of the category is taxes so it is difficult to lower this position significantly.
- Other fixed exp includes union fees, GF unemployment insurance, phone, internet and my psychotherapy course and my own mandatory therapy sessions. Lean is without psychotherapy exp as I hope to get my employer to pay for it when I will finish residency in 1,5y. Extreme budget also excludes union fees and unemployment insurance.

Please comment and make suggestions.
I will dive deeper into each category in coming posts and later today/tomorrow I will make a post about our spending the past 6 months and our assets.
Now it is time for dinner. It took me 20-30 min to write this up and I "lost" a bit more than that on my original post that was more specific.

@thedollar
Thanks for following. What a run the team had. Great fighting spirit in the semi.

[Quadalupe]

You can do right mouse button > Open image in new tab to find the actual URL to the image (it's https://i.imgur.com/YlsAH6p.png for this one). Then you can add it with the img tags you mentioned:

[img https://i.imgur.com/YlsAH6p.png[/img] (bracket removed so I don't post your images)

[Bonde]

@Quadalupe
Thanks!
I have corrected the post

[Bonde]

Results from Q1 and Q2


All numbers are in DKK (1 USD = 6.3 DKK)

SR calculation was wrong for the normal budget posted yesterday. It's corrected but maybe not so important as I won't pay for therapy by myself this year and the budget is then off by 40,000.

Savings is much better than expected due to us having a higher income. We got extra pay from a vacation fund granted by the government because of the covid crisis.

Food could be a bit lower and I expect it to be lower during the summer when we get lots of veggies from the garden. Already got the first cucumbers and expect tomatoes to be ready soon. We have also cut down on sweets and chips the past few months.

Other fixed exp includes in Q2 a 13,000 fee for my psychotherapy course. I only have one payment left and then I have paid for the 2 year course.

Other house exp includes power from the grid and I have not yet logged have much of the power that have been used from the car. I have the data but takes some time to add it up.


Cash and index funds:


One account that has a monthly free purchase. It's always the same day and you have to decide beforehand. That way it's good for a dollar cost average strategy that we use.


Graph for the above


Another special account for stocks/ETFs that has lower tax and you are allowed to by ETFs. Normally ETFs are taxed differently than Danish index funds. Max amount is 102,600 this year:


Just bought a chunk of World small cap yesterday when it had decreased more than 3%. Then p/e was less than 20 and it could be a fair price in these circumstances.

GF mostly has World and World min. vol.

I think that we will add 10-20% of different bonds but I have not read up on it yet. And I'm not sure if it's a smart move taxe wise. But I also think that a crash is likely in the near future. Maybe cash is fine for us.
I would like to have around 500,000 invested at the end of the year. Maybe more. 150,000 in cash should be fine for us. It's about 8 months of expenses and enough to by a new electric car if insurance won't pay for it after an accident or something like that.

[Aspirant]

The FIN-DAN football game was quite exciting. When Eriksen went down, the Finnish supporters started chanting Christian and the Danes responded Eriksen... You are right. They should not have made Denmark team continue the match. It was not a fair game after that incident.

Welcome to the forums. Looking forward to reading about your journey.

[thedollar]

@Bonde

Seems like you are on top of everything! You're holding a bit too much cash for your age seeing as you have a very strong foundation (high SR, income etc.), but it sounds sensible that you will DCA into investments. Also, investment returns doesn't really impact time to FI if you have a very high SR, so it's probably not a problem.

If you keep this up you will for sure be in a very good place within a few years!

[Bonde]

@the dollar
Thanks for the comment
It is nice to get some encouragement and I think that also partly have made me less focused on ERE (and this blog) and just keep working this way with some minor adjustments.

@Aspirant
Thank you for following.
The men's football team keeps winning and are already pretty close to securing a spot for the world cup. Will be interesting to see how they handled/protest the slavery-like work force in Qatar.

UPDATE
The last months have been very busy with courses, long work days, gardening and so on. But we are doing good and our expenses have been steady.
From now on I will share personal finance quarterly and maybe other posts if I have time for it and some interesting to share. Other than that I will try to prioritize my personal diary that also have been neglected in the past months.

Danish investment taxes are high and confusing.
In short, equities and some equities funds (but not most ETFs) are taxed 27% for maximum 56,500 DKK in annual profits and 42% above that. If you are married the amounts doubles. The profit is first taxed in the year you sell but dividens are taxed annually.
Bonds, REITs, gold, crypto etc. are taxed as capital income. Annualized total profits are taxed by 37% or 42% if you made more than 46,800 DKK in profits (double up for married couples).

I want to make an investment plan and I like the golden butterfly portfolio but I have not before now look more closely at the implications of the Danish taxes. So I took data from the portfoliocharts (50/50 US/EU stocks and bonds) and macrotrends.net (gold) and made a couple of graphs.

First here is the accumulated profits since 1970:

GB looks good and clearly better than 60/40

But when I account for taxes the volatility of bonds and gold ends up costing a lot of profit so I designed other versions of GB. The one that looks a little better than 60/40 is with 10% gold and 30% bonds but to me it is clear that the tax system benefits equity investments.


My conclusion is that we will try to add some gold but not 20% and we have already added an ETF (approved for equity tax) for gold producers to get some exposure to gold. Bonds will be 20-30% but it is difficult to find some good mixed ETFs or Danish funds that have low expenses. I will keep studying this.

Reading Ray Dalios online book "The changing world order" I prefer to have broad exposure to be ready for a possible change in the big debt cycle.
https://www.principles.com/the-changing-world-order/

[Bonde]

Some numbers as we have added up all of our accounts this evening.

For 2021 total stocks+bonds+cash at the end of the quarter.
Q1: 515,978 DKK (stocks 80,802, no bonds)
Q2: 703,383 DKK (stocks 282,093, no bonds)
Q3: 816,248 DKK (stocks 433,196, bonds 38,890)

In Q2 we got a lot of extra money from vacation fond that the government administered and decided to allow people to withdraw as an economic stimilus.
In Q3 GF was in between jobs for one month but I got a lot of overtime paid (115h in a span of 17 weeks). I also donated 17,000 DKK to MSF.
In the coming weeks I will find an international fund for bonds. Right now we only have a Danish fund for bonds. Atm bonds are only 8% of our investments, should be 25-30%. We also need to buy a gold ETF for 10% of our investments.
Cash goal is 150-200,000, around one year of expenses.
If we can keep adding 100,000-150,000 to our investments quaterly we are on a very good pace to FIRE.

I will share more thoughts and data for our expenses when I have time to add it up and make graphs.

EDIT: I'm forgot that data from Q1 do not include GF's accounts. Savings in Q2 was 102,140 DKK and not almost 200,000.

[DutchGirl]

Hi

Are you also saving in some type of pension plan? Is there a government pension (and do you think it will be around when you are of retirement age)?

I live in the Netherlands, there's both a state pension plan and most people are obligated to invest in a work pension plan; this is true for me as well. So I plan my retirement in two stages: first stage is before official retirement age, during that stage my personal savings will be needed to pay for expenses. Second stage is after official retirement age, when the state pension and work pension will start paying out. In my case those two will completely cover my expenses with extra to, I guess, give away. So my personal savings/investments only need to cover the 20 or so years between the two stages. This reduces the amount I need to save up for before I can call myself FI. If the state pension and work pension would not completely cover someone's expenses, at least they would reduce the expenses that need to be covered by personal savings and thus also reduce the amount of personal savings that would need to be left by official retirement age - thus also reducing the amount that you'd need to save up for.

A website like firecalc.com can help you create a plan that takes a stream of income from a certain age into account. If that doesn't help enough ... it's time for another spreadsheet (hurray!).

[radamfi]

Second stage is after official retirement age, when the state pension and work pension will start paying out. In my case those two will completely cover my expenses with extra to, I guess, give away. So my personal savings/investments only need to cover the 20 or so years between the two stages.

Can't you get your work pension earlier than the state pension? In the UK, work pensions can be withdrawn at age 55 (57 in a few years).