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Re: Rube's journal

Posted: Wed Mar 05, 2014 9:20 am
by Gilberto de Piento
I like the marathon analogy!

Re: Rube's journal

Posted: Fri Apr 04, 2014 4:17 pm
by rube
Thanks Gilberto.

March update

Finances
Expenses: 2208
Income 7098 (5363 regular income, 825 tax refund, 654 Interest/cash back, 101 dividend, 151 CL sales )
Savings ratio 69% (average 12 months 65%)

Special expenses: about 800 for a new kitchen (not finished yet). But our mortgage of March was paid only early April, so actually expenses were higher but this will become visible in April totals.

Income: the regular income was common, but we received quite some additional money by the tax refund, interest, dividend and craiglist sales. Also we got 200 through a special kind of cash back action by opening 4 accounts. It’s one time only cash back, I’ll withdraw the money in June and close the accounts again but I thought it was worth to spend an hour or so to earn 200 euro’s.

Moved some savings to pay off another 7K from our mortgage. Somewhere later this year we’ll pay another 7K and then we’ll have to wait till next year again before we can pay off without getting a penalty.

My manager informed me that my salary will increase by 2.5% per April. Not a huge raise, but will still be about 80 euro’s net a month, so I’ll take it.

I received our tax-free mortgage saving overview and found out that the value was about 1K higher as I expected.

Our net worth increased 4.6K to 318.5K.

Side business
The side business value, cash on bank account only, increased also by about 1K due to receiving some payments.

Other
Spring has arrived again! Lovely weather, could even go outside in a shirt only a few days. Argh, I like that so much.

Some exciting things happened at work. Can’t go into details, but I felt “to be in action” and I learned more things in the last 10 days then in 3 months before. It seems also that everybody is accepting my decisions about how to handle this and is acting accordingly.
Sometimes I am surprised that people do see me in certain cases like a leader and the specialist who decides about pretty important (well, what’s important…) things. I don’t see myself like that.

April finance forecast
Car maintenance will be added to the budget (450) and two times the mortgage payment (620 more) as well as some additional kitchen stuff (estimate about 300). So April will be a month of high expenses.
I expect to receive about 250 additional interest due to an action of our bank, but that’s it. Nothing else expected apart from the regular income, So it will probably a low savings rate for us.

I also did our tax filing and we’ll need to pay about 600, but that will likely be in June / July.

Graphics
Savings account percentage of the total net worth went down from 43% to 41% due to the move to the mortgage pay off.
PP total is not doing much, but who would have thought that long term bonds would be up by almost 6-7% in a year?!
Gold is down about 25%. I am planning to re-balance this month. Likely I will purchase some additional gold to bring all back to 25%.

I added a graphic showing current expenses, expenses when we would now not be working (Expenses ERE) and theoretical WR at 3% and 5% and actually realized nor-regular-work income.

Image

Thanks for reading again!

Re: Rube's journal

Posted: Mon Apr 07, 2014 12:56 pm
by Hankaroundtheworld
Hi Rube,
Just have been reading your journal, and congratulations to keep expenses so low for a Dutch situation. I just visited my sisters in the Netherlands, and one of them (with one kid) is spending 3500 euro per Month, and the one with 2 kids, at least 4000 euro per Month !! When they complained that they need to work till at least 65 (especially when I told that I want ERE now), I told them to change their behavior of consuming, and start saving more. So, congratulations to you !!

Re: Rube's journal

Posted: Mon Apr 07, 2014 2:49 pm
by DutchGirl
Henk and Rube,

I get part of my inspiration to stay frugal from this blog: http://zuinigaan.blogspot.nl/2014/03/ve ... -maar.html

My expenses are roughly 1500 euros per month, and I guess my boyfriend spends at least another 1000 euros per month (maybe more, I don't know all of his expenses, I know he pays 400 for housing and utilities, 300 for groceries, and 150 for health insurance... ). But she manages to spend for example 150 euros per month, and that includes groceries, gifts, clothing... Plus she currently has a mortgage of only a few hundred euros per month because she paid it down rigorously.

It's inspiring, or it may also be a bit frustrating if your expenses are roughly 7-10 times higher than hers... But I'll go with inspiring...

Re: Rube's journal

Posted: Wed Apr 30, 2014 2:13 pm
by rube
@Hankaroundtheworld: thank you appreciated. And, you’re doing quite well yourself also.

@DG: Yes, I say inspiring. And I could down further if I would be alone (in decision making). But, I need to compromise with the family sometimes (and they with me, ha!) We found a quite okay level where we’re all happy I guess. When I would not work/have more time, we could save some more. But the time it would consume is not worth the effort for me right. We’re working 40+26 hours and have 2 kids to entertain (or they entertain us maybe??).

April update

Finances
Expenses: 3261
Income 5953 (5429 regular income, 240 Interest, 284 CL sales)
Savings ratio 45% (average 12 months 63%)

Special expenses:
2 x mortgage due to late debit in March. So nothing unexpected, it’s just messing up my monthly figures :evil:
Another 385 for the new kitchen. I still need to install it, but we got now almost all materials and equipment so no major expenses on this anymore expected. Without these special expenses the total would have been 2279 versus 2333 at the 12 months average. So I am not worried about the increased costs this month.

Income: the regular income was common. My pay raise came out net at 67. Some nice interest and CL sales of together a little over 500.

Decided to pay another 7K to our mortgage. Now we have to wait till next year before we can pay off another 10%.
Our net worth increased 3.9K to 323K.

Side business
The side business value, cash on bank account only, increased also by about 0.6K due to delivering an order and receiving a payment.

Investments
For the first time we jumped (slightly) into the PP 13 months ago we’re positive!
Bought some gold to re-balance the PP, but need to buy some more to re-balance correctly. Need to find some time to do so.
Bought 4 dividend growth stocks (well, I a hope it will turns out to be dividend growth stocks ;) ). All just small investments.

Due to the investments and paying 7K to the mortgage, the Cash and savings account parts is decreased to 38% from 41% last month.

We save on average about 4K, where do I need to invest it each month?? :?:


Other
Ehm..been busy (a bit) in the weekends to prepare to install our Kitchen. Hope I will be ready with in May.
I have been only in the office a few times this months. I was very busy with work and it was more efficient to work from home. Nobody noticed, my manager is not aware (he’s working from another continent). Furthermore nothing special I guess.

May finance forecast
Ah, May will likely be good for the savings ratio: DW and I expect the annual “holiday allowances”, roughly about 4K additional. So income in total around 9.4K. Also I expect to be reimbursed by my employer for € 400 so if nothing unexpected will happen, our expenses will likely be around 2K or even a little lower.
If that would come true, it would result in a 78% savings rate and our highest ever :shock: and bring the 12 months average 1% up (down 2% this month..)

Graphics
Well, what to say about. Anyone who follows my journal knows what to expect I guess.

Image

Hope it is useful for anybody (it is for me, and I just like to keep track of it anyway :lol: )

Questions, comments, feel free to write in my journal.

Re: Rube's journal

Posted: Fri Jun 06, 2014 10:59 am
by rube
May update

Finances
Expenses: 2225
Income 9710 (9569 regular income, 142 Dividend)
Savings ratio 77% (average 12 months 64%)

Special expenses:
Some additional daycare and some more stuff for the new kitchen. In the end it didn’t affected the total amount too much because we were reimbursed by the employer for earlier expenses.

Income: very high as expected, due to the annual holiday allowances in may. It is the highest income we ever had.

Investments
Value of PP and other investments increased a little more. Where does it end, when do we get the correction?
Bought some more gold to re-balance the PP, almost done now.
Bought also some more dividend growth stocks and invested a some in P2P lending. All nothing major in the total scheme of assets.
The cash and savings account part stayed at 38%.

Other
Still busy in the weekends with our new kitchen. Hope to finish it this weekend, one week later as I hoped last month..
We bought the equipment 2nd hand (but fairly new), cabinets and counter top from IKEA. Looks pretty good if I may say myself.
Total cost 1700 Euro and I gained some skills. If we would have bought and installed in the “normal way”, we would probably have spend 4K more. I am very happy with the result.
I guess the value of the house will actually increase (at least) similar to the costs, but I’ll play it “safe” and keep the value of the house the same.

Again, I have been only in the office a few times this months. Reduced my commuting cost a bit although that was not specifically the reason.

Went on a short business trip in the EU, nothing special this time: I spend all of it in planes, trains, cars and offices.

June forecast
Nothing really special expected, should be an average month both for income as expenses.

Graphics
I added one new chart, to keep track of the difference between our average monthly savings and the average monthly increase of our net worth.

Image

Re: Rube's journal

Posted: Fri Jun 06, 2014 12:13 pm
by Hankaroundtheworld
What P2P lending are you using, is this in the Netherlands, and if not, where did you go, thanks for some sharing on that

Re: Rube's journal

Posted: Fri Jun 06, 2014 12:21 pm
by DutchGirl
I'm not Rube, but I use http://www.geldvoorelkaar.nl . I've been using it for three years now and so far so good; average PROMISED interest rate for me is around 9%, however: only two loans have finished paying back so far. If defaults happen, my 9% profit could easily turn into a loss.

Disadvantages: minimum investment per loan is 100 euros or roughly $130. Very long loan periods, currently all available ones run for 60 months (although you get a repayment every month, this means that you only get to see some real profit during the fifth year). There are not many investment options offered at the same time (currently about 10), terrible search engine and no way to be alerted about upcoming interesting offers.

I am considering quitting it, letting the current loans run their course but not add new ones. It'll simplify my investments somewhat and you can probably get a just slightly lower profit with less risk when you invest in the stock market...

Re: Rube's journal

Posted: Fri Jun 06, 2014 1:20 pm
by rube
Indeed, "geldvoorelkaar" and it has all the disadvantages DG mentioned. I invested in about 15 loans for 125 on average orso. The higher yield looks nice but it's too risky too put in a substantial amount.

There is also www.bondora.com to which I transferred 25 euro to, just to see how it works.
It looks better, but I am not sure how trustworthy it is AND the interest the people that take out loans have to pay is sometimes enormous, like 30%. It doesn't feel morally right to make profit that way. For both reasons I likely won't invest a lot here either.

But the question remains: where to invest into instead, everything looks expensive at the moment.

Re: Rube's journal

Posted: Fri Jun 06, 2014 2:54 pm
by henrik
I've been using Bondora for 8 months now, so far so good. They are expanding across Europe very agressively, which I guess has its potential upsides and downsides in terms of risk.

Re: Rube's journal

Posted: Sun Jun 08, 2014 7:10 am
by Hankaroundtheworld
Hi, thanks for the idea; this Bondora sounds a bit too good to be true, who knows there is a Pyramid scheme behind it, and they pay well with fresh investor money coming in, till it explodes ...
I have tried to find how your money is kept; I mean what account and how well protected?
How about transferring money back to your Bank, how does that work?

Re: Rube's journal

Posted: Sun Jun 08, 2014 1:25 pm
by henrik
Logically, any P2P lending platform will have characteristics of a pyramid scheme. Loans take a while before they default and then those that don't get recovered will take a while before they get charged off. This means that when the proportion of new investors is high, the overall default rate is correspondingly lower and the returns that much higher.

My returns (actual realised, XIRR, annualised) have hovered between 20 and 22%. I'm surprised by how stable it's been, but I have every expectation that as my portfolio and the whole platform becomes more mature, the returns will go down. I believe this also happened with LendingClub and other more popular ones as they grew and matured.

Re: Rube's journal

Posted: Sun Jun 08, 2014 1:46 pm
by Hankaroundtheworld
May be use some play-money of 5000 Euro, for the fun and try out, I am thinking of it

Re: Rube's journal

Posted: Sun Jun 08, 2014 1:53 pm
by henrik
Maybe an admin could split the last few posts of this into a "European P2P lending" thread or something like that so we could keep track of options and how we're doing and not hijack rube's journal?

Re: Rube's journal

Posted: Sun Jun 08, 2014 3:04 pm
by rube
Henrik, NP. to keep these current posts here. I am interested in more details as well.

Re: Rube's journal

Posted: Mon Jun 09, 2014 4:02 am
by henrik
Hankaroundtheworld wrote:I have tried to find how your money is kept; I mean what account and how well protected?
How about transferring money back to your Bank, how does that work?
Well, ideally your money is not kept anywhere, but invested in loans, i.e. used to pay for other people's stuff:) That said, the specific account I have used to transfer funds to Bondora is, if I read the IBAN format right, in the Estonian subsidiary of SEB. Of course they might have more accounts than that one, but I doubt that the bank is a high source of risk here.

As for transferring money, when you transfer funds to them, your bank account number gets associated with your Bondora account and thereafter funds can be transferred out only to that same account. I understand it's intended so that even if anyone gets access to your Bondora account, funds can still only be transferred out to you.

Personally, I consider P2P lending quite risky. Not so much because of loan default risk (there are various strategies to mitigate that from diversification to criteria screening etc), but because of the single point of failure that is the company operating the platform. Legally, even if the company goes bankrupt for whatever reason, you will still own your loans. But if you have diversified well enough (eg Bondora lets you invest even in 5€ notes), it will not be realistic to go after each of those small pieces on your own by way of debt collection agencies or courts.

Re: Rube's journal

Posted: Fri Jun 20, 2014 3:59 am
by rube
DW had an interview yesterday with a recruiter. Most likely she'll have next week 1st interview with the company. Priority is the work okay and atmosphere is better as current work. But if it all goes further she's likely able to make a nice jump in salary as there is a huge demand and low supply of her expertise. Fingers crossed.

Re: Rube's journal

Posted: Sun Jul 06, 2014 8:25 am
by rube
DW got interviewed 4 times now and expects an offer within a few days. Quite interesting how all went so far. Maybe I post more details later, maybe not (because of privacy).

Work and social life is keeping me and the family quite busy lately. I kept track of all financial details in June but will post the graphics and details later this month when I have some more time/energy, perhaps I combine them with July.

Currently preparing/packing my stuff for a business trip later this month to CA-USA. I will have some free time in the weekend to do some sight seeing. I Look forward to that.

Re: Rube's journal

Posted: Thu Aug 07, 2014 12:19 pm
by rube
I have not abandoned my journal at all, but it is just quite busy (work, social, holiday) and at some other times I just didn't want to do anything but relax.

DW received a lousy offer after 4 interviews. The headhunter made a big judgement mistake in the proces (he already thought his bonus was in the pocket). She obviously didn't accept it.

With the first few days gone in August we already spend half of our normal monthly expenses due to new glasses for dw and additional daycare for the kids during their school holiday periode. And we still have to leave for the final holiday...

No complains however on the financial side. I'll try to give a long(er) update next week when we have holiday, but no promises ;)

Re: Rube's journal

Posted: Fri Aug 08, 2014 1:27 am
by DutchGirl
Damn, that's too bad (the offer).

But enjoy your holiday!