Heyhey's journal

Where are you and where are you going?
heyhey
Posts: 113
Joined: Sat Jul 19, 2014 7:17 pm
Location: Herts UK

Re: Heyhey's journal

Post by heyhey »

Thanks, Ydobon! The veg box costs £14.45 per week. I haven't had it this week and I've spent about £10 on veg. I do eat a lot - the box is supposed to feed 2-3 people. But a lot of my food costs for December were Christmas-related, with guests etc.

Do you mind me asking how much is the Virgin connection? I spend about £40 per month with BT, for phone and fibre broadband with unlimited downloads which I need for my work. I don't have a television.

Ydobon
Posts: 412
Joined: Fri Aug 29, 2014 9:15 am
Location: Scotland

Re: Heyhey's journal

Post by Ydobon »

I *think* it works out at about £35/m, but it's complicated as you typically have to take advantage of cashback + joining incentives (cash/vouchers etc.) + any offer price (i.e. £x/m for the first year). We could have got it cheaper as well (£21/m?), my wife made me order more TV channels as she likes to relax with some nonsense once the baby goes to bed :)

Virgin are notorious, however, for changing prices, so you need to shop around. That said, we get 75MB fibre broadband with no limits and it's very impressive as a user.

heyhey
Posts: 113
Joined: Sat Jul 19, 2014 7:17 pm
Location: Herts UK

Re: Heyhey's journal

Post by heyhey »

Can't believe how long it is since I posted here! I have been tracking inc/exp but not NW. Income has gone through the roof the last couple of months, allowing me to save plenty :D It's likely to drop in the second half of the year but I hope for an average of over 50% savings for the year.

January 2016

Income after business expenses = £725.88
Expenditure = £680.00
Surplus = £45.88
Saving rate = 6%

February 2016

Income after business expenses = £1,160.36
Expenditure = £684.80
Surplus = £475.56
Saving rate = 41%

March 2016

Income after business expenses = £2,740.36
Expenditure = £1,848.80
Surplus = £891.56
Saving rate = 33%

April 2016

Income after business expenses = £2,439.97
Expenditure = £801.87
Surplus = £1,638.10
Saving rate = 67%

May 2016

Income after business expenses = £3,733.97
Expenditure = £695.17
Surplus = £3,038.80
Saving rate = 81%

June 2016

Income after business expenses = £4,387.83
Expenditure = £833.92
Surplus = £3,553.91
Saving rate = 81%

NW at end of December 2015 was £25,030.

Current net worth = £33,850
plus equity in my house
Target = £175,000

Expenditure is much higher some months than others because I pay bills quarterly, six monthly or annually. Ignoring these, my expenditure has been relatively steady over the six months, but considerably higher than budget. I still need to work on spending, especially on food, alcohol, and books*. I have spent in total £1000 over my expenditure budget in the 6 months without a good reason. :oops:

* no more sitting down with bottle of wine, box of chocs and Kindle of an evening

heyhey
Posts: 113
Joined: Sat Jul 19, 2014 7:17 pm
Location: Herts UK

Re: Heyhey's journal

Post by heyhey »

I did graphs :D
Most of my bills are not monthly, so even if other things are equal, expenses will vary a lot.
And since I am self employed and working for a small fixed amount plus variable commissions, my income varies a lot too.
I pay electricity in Mar, June, Sept, Dec / water in Mar, Sept / insurance in Oct.
Also spent £400 on roof repairs in March.

Image

JeanPaul
Posts: 66
Joined: Tue Jan 01, 2013 5:15 am

Re: Heyhey's journal

Post by JeanPaul »

If that income trend keeps up, your only concern will be pricing yachts.

vraxxos
Posts: 40
Joined: Tue Mar 24, 2015 8:36 am
Location: UK

Re: Heyhey's journal

Post by vraxxos »

Another Brit, wonderful :)

What is your long-term goal, how do you intend to support yourself in retirement?

heyhey
Posts: 113
Joined: Sat Jul 19, 2014 7:17 pm
Location: Herts UK

Re: Heyhey's journal

Post by heyhey »

Jeanpaul, yes that would be amazing, after a year I would be earning enough to retire on in a month :D
Unfortunately this spring was an anomaly. July income will be about 60% of June's. (I'm paid a month behind so I know.)

Vraxxos, I am hoping never to need a full-time job again, and to have enough money behind me to not panic if I'm not making any from work, ie to be FI. Right now I'm not sure if my self-employment will last, both if it will keep being enough to live on, and whether I will get bored and want to change (which happened to me all the time with jobs). For now I have to stay in the area I am for my work, but when I have saved enough I'm aiming to sell my house, move to a cheaper part of the country, and have enough with savings plus the difference in house price to live on the interest. I'd like to have a big garden with vegetables and chickens :D

My savings goal is £75,000 and I am assuming I can release another £100,000 from equity in my house. My net worth includes one small past employment pension pot that I can cash in at age 55, but not the other two that I won't see until I'm 65 and plan to take as income.

heyhey
Posts: 113
Joined: Sat Jul 19, 2014 7:17 pm
Location: Herts UK

Re: Heyhey's journal

Post by heyhey »

Inc/exp for July 2016

Income: £2,597
Fixed work gig: £400
Variable self employment: £2,176
Misc (used book sales): £21

Expenditure: £499
Housing: £235
Utilities: £0
Groceries: £113
Household: £15
Health/personal care: £26
Transport: £1
Entertainment: £94
Clothes: £0
Gifts: £16

Surplus/savings: £2,098 (81% of income)

Net worth: £39,463
plus equity in my house.

Target: £175,000

This was a great month! 81% savings rate is perfect, but the big celebration is for keeping my expenditure under £500 :) I have never done that before. Yes it was a low-expense month with no utility bills and nothing else major like insurance or house repairs, but other months have been like that too and I've never got so low.

One thing that helped was signing up for the YNAB free trial to see how it worked. I loved the look of it, but I didn't want to have to pay for it every year, so I made myself a spreadsheet that does pretty much the same things - accounts for every penny and allows me to adjust categories according to what I need that month, instead of setting a figure that's the same every month, which only encourages me to fritter more away in months when there are no big bills. It took many hours to design and tweak, but it was worth it!

Income was down but the last couple of months were exceptional so I was expecting that. I was happy it was still above £2,500. It will be a little higher again in August.

Here are my graphs. I made a mistake entering the figures for the net worth graph last month, so it's grown more than I thought :)
(ETA: that's the first one, I see it's mislaid its heading)

Image

User avatar
Bankai
Posts: 986
Joined: Fri Jul 25, 2014 5:28 am

Re: Heyhey's journal

Post by Bankai »

Great progress! Especially going below £500. Next step would be not spending any money on "entertainment" for a month to get below £400 :)

What about utilities - have you included them in "housing"?

heyhey
Posts: 113
Joined: Sat Jul 19, 2014 7:17 pm
Location: Herts UK

Re: Heyhey's journal

Post by heyhey »

Bankai wrote:Great progress! Especially going below £500. Next step would be not spending any money on "entertainment" for a month to get below £400 :)

What about utilities - have you included them in "housing"?
Re entertainment: not sure about that, I've made a conscious decision to spend a certain amount on going out, because I live alone, and I go a little crazy otherwise. Unfortunately my friends are less frugal ...

My utility bills come every 3 or 6 months, and insurance annually, so those can make my expenditure very different from month to month.

George the original one
Posts: 5404
Joined: Wed Jul 28, 2010 3:28 am
Location: Wettest corner of Orygun

Re: Heyhey's journal

Post by George the original one »

> My utility bills come every 3 or 6 months, and insurance annually, so those can make my expenditure very different from month to month.

If you're interested in smoothing them out, set up monthly savings allocations for those expenses and only pay out of that account(*) for it. If the cost is more than you saved, then it becomes an expense at the time of the bill.

(*) Doesn't have to be a real account, just something to smooth the spending line.

heyhey
Posts: 113
Joined: Sat Jul 19, 2014 7:17 pm
Location: Herts UK

Re: Heyhey's journal

Post by heyhey »

I think that would be too complicated for me, George ...
I do allocate money in my savings account for all of the bills, including clothes, dental, etc - almost everything except food and going out. I keep it in the savings account because it gets 3% interest. I have a spreadsheet showing the money in that account split between those allocations, my savings for my tax bills, and two other types of savings ... If I split it down again beyond that, I think I might get confused :shock:

ETA: wait, I think I see better what you mean. Count the money as an expense every month, say £50 per month for electricity, even though I'm not really paying it. Then when the bill comes in, add or subtract the real difference to/from that month's £50? There'd still be some seasonal difference because of heating costs, but I could build that in. I will think about it.

George the original one
Posts: 5404
Joined: Wed Jul 28, 2010 3:28 am
Location: Wettest corner of Orygun

Re: Heyhey's journal

Post by George the original one »

Right, that's the idea :-)

heyhey
Posts: 113
Joined: Sat Jul 19, 2014 7:17 pm
Location: Herts UK

Re: Heyhey's journal

Post by heyhey »

August 2016

Income (before tax): £5,382
Fixed work gig: £400
Variable self employment: £5,043
Misc (used book sales): £39

Expenditure: £614
Housing: £235
Utilities: £0
Groceries: £149
Household: £2
Health/personal care: £13
Transport: £19
Entertainment: £124
Clothes: £30
Gifts: £42

Surplus/savings: £4,768 (89% of income)

Net worth: £45,567
plus equity in my house.

Target: £175,000

ETA: see next post for figures after tax.

This was an amazing month. My income is through the roof and I actually find it scary - I've never earned so much in one month in my life before. Of course, this is all before tax, which I will not have to pay until 2017/18, and I know the amounts are not huge compared to the pre-tax salaries of many people here. But for me it is great wealth!

A few years ago I would have seen this as a windfall that I could go out and spend on a holiday, new car, new kitchen, whatever. But since finding ERE I am not tempted to spend it. I am banking as much of it as I can, and stashing a good percentage in a separate account for the eventual massive tax bill that will arrive when my income may be much lower.

Expenses this month included new shoes (the old ones were worn out), two birthday presents, and one Christmas present bought early because I happened to see something that seemed perfect.

I thought about doing what George suggested and allowing a monthly amount for the bills like utilities that I don't pay every month, but there are so many - phone and electricity every 3 months, water 6 monthly, insurance annually, council tax 10 months out of 12, and then income tax and NI which are very hard to estimate without knowing what I'm likely to earn for the rest of the year. If I tried to even them all out into monthly amounts, I'd end up with a budget, not a record of expenditure. So I decided not to do that.
Last edited by heyhey on Sun Sep 04, 2016 7:11 am, edited 2 times in total.

heyhey
Posts: 113
Joined: Sat Jul 19, 2014 7:17 pm
Location: Herts UK

Re: Heyhey's journal

Post by heyhey »

After I posted yesterday, I realised that I could and should do a more accurate calculation of tax and NI, and subtract it before I post income. I can't spread it evenly over the year without knowing what my income for the rest of the year will be, but I can calculate it month-by-month on the basis of charging myself no tax and NI until I hit the allowances each year, then basic rate until I hit the higher rate (if that ever happens), and higher rate from there. Plus for completeness I need to add the 50% payments on account that will be due, and in future years, subtract the previous year's payments on account (I didn't have to make any last year).

None of that will make sense unless you are a self-employed UK taxpayer but it's here in case I need to come back and remember how I calculated it (or in case there is anyone in the same unpredictable situation who wants to do the same.)

This reduces August's income by a lot, but it's more realistic, especially if comparing with a situation where tax is deducted at source, as mine used to be. It also reduces my net worth because I was including the balance in my tax-related savings account, and from now on I won't.

Adjusted August income after tax: £4,138
Fixed work gig: £400
Variable self employment: £3,699
Misc (used book sales): £39

Surplus/savings: £3,524 (85% of income)

Net worth: £43,607
plus equity in my house.

Here are the graphs:

Image

heyhey
Posts: 113
Joined: Sat Jul 19, 2014 7:17 pm
Location: Herts UK

Re: Heyhey's journal

Post by heyhey »

September 2016

Income (after tax): £2,634
Fixed work gig: £400
Variable self employment: £2,164
Misc (used book sales): £70

Expenditure: £1,377
Housing: £235
Utilities: £404
Groceries: £151
Household: £89
Health/personal care: £327
Transport: £35
Entertainment: £122
Clothes: £0
Gifts: £15

Surplus/savings: £1,377 (50% of income)

Net worth: £46,707
plus equity in my house.

Target: £175,000

All the utilities bills came in this month, including water which is 6-monthly. The others are quarterly.

I needed a new pair of glasses, which is most of the health/personal care cost. I knew that was coming and had budgeted for it.

Groceries are still too high - too many treats when I'm bored. I've been researching frugal recipes from http://www.thriftylesley.com/meal-plans/ (a UK £1-a-day site) so that I can have some new and interesting dinners while keeping costs down. The aim for October is to get groceries and entertainment under £100 each.

Entertainment includes alcohol, cinema/theatre/music gigs, and eating out about once a month. Most of these are activities with friends, which I don't want to give up, but I do have some alcohol at home which I want to cut out.

I must have made a mistake with the net worth last month, because it hasn't really gone up by £3,000. I think I was subtracting the balance of the tax provision account already, and the net worth in my post of September 3rd was correct. Anyway, it's right now... I think...

Image

Noedig
Posts: 191
Joined: Tue Aug 26, 2014 10:15 pm

Re: Heyhey's journal

Post by Noedig »

Hey HeyHey

The principal luxury you get with self employment is power over what you do when, "power over time itself!". The drawback, is anxiety about whether the work will come. It's a toughie. I don't think myself I would have the willpower to be productive without people relying on me who I care about. I hope you have higher professional standards!

You don't mention how old you are, which would give some context for your ERE goals. Well done for making a good start, and the most important thing is changing your thinking, which you have already done it seems. Kudos to you, and good luck.

heyhey
Posts: 113
Joined: Sat Jul 19, 2014 7:17 pm
Location: Herts UK

Re: Heyhey's journal

Post by heyhey »

Thank you, Noedig. I am in my forties, so not very extreme.

I think I have changed the thinking, but I am still struggling with some aspects of consumption. I'll post October's figures now. November is actually going pretty well. I have cut out alcohol, which makes a big difference, not only because going out is suddenly a lot cheaper, but also because there is a knock-on effect somehow.

heyhey
Posts: 113
Joined: Sat Jul 19, 2014 7:17 pm
Location: Herts UK

Re: Heyhey's journal

Post by heyhey »

October 2016

Income (after tax): £1,323
Fixed work gig: £400
Variable self employment: £906
Misc (used book sales): £17

Expenditure: £935
Housing: £235
Utilities: £0 (paid quarterly)
Insurance: £250 (paid annually)
Groceries: £112
Household: £53
Health/personal care: £140
Transport: £6
Entertainment: £139
Clothes: £0
Gifts: £0

Surplus/savings: £388 (29% of income)

Net worth: £46,164
plus equity in my house.

Target: £175,000

I don't know why the net worth went down this month. It shouldn't have. I made more than I spent, and my investments increased a little bit. It must have been wrong last month. I have a slippery net worth that I can never get a hold on!

The health/personal care was mostly a dental bill.

Goals for November: same old get groceries and entertainment under £100 each. Since I have given up alcohol, the entertainment should be OK, although I have spent a lot on books so far in Nov.

Image

heyhey
Posts: 113
Joined: Sat Jul 19, 2014 7:17 pm
Location: Herts UK

Re: Heyhey's journal

Post by heyhey »

I want to get back into this. I have been tracking, and I've been saving, but my income hasn't been so high and I've been spending more than I'd like.

My net worth end of March 2018 was £56,055. So it has increased by just under £10K in the 17 months since I last posted. That's not as much as I'd hoped but it's 40% of my income for that period.

My total spending for the year 2017 was £10,252.

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