Happy New Year everyone!
I just reread my 2019 review which I wrote about a year ago, and my, what a different year 2020 was!
A brief summary to start: We finished the rental (which was a lot of fun) and found some reliable renters just before the covid situation hit the fan. We went on skiing holiday but drove back after two days because the resorts closed. My wife got pregnant again (our son is due literally any time now), and a-l-m-o-s-t finished her phd. I did a lot of sports and loved it. We planned our sabbatical and will be free from work from March 2021 until November 2021. My wife is already on pregnancy leave now. We will not officially quit our jobs but are taking parental leave, so our backup plan is to return to our current jobs in November 2021.
Now let’s take a look at how my targets for 2020 panned out:
Targets for 2020
- Achieve a savings rate of at least 55%
Partly because of the covid situation, our spending has been the lowest since I started my book keeping, I had a savings rate of 65.66%*. So technically, a big fat success, but at the cost of more social isolation.
* I do not count my investment income, which is mostly dividend, as part of my savings rate
- Have a non-paycheck income of at least 50% of expenses
This came in at 43.03% this year, very much the same percentage as last year even though our spending was lower now. This was mostly due to us wanting to build up a buffer for possible renovation of our rental house, so we left all the rental income on the shared bank account with my parents in law. Since we own this rental together with them, I believe it’s prudent to have a buffer on it to make sure that we will always be able to pay for big renovations out of pocket. I just see this as an additional ‘cost’ of owning a rental house together with my parents in law.
Additionally, my income from side hustles was low this year.
- Do sports at least three times per week on average
This was a big success, I did sports 219 times in 2020. Some achievements among others: I ran two marathons and did a tortuous cycling training schedule in summer to get in shape in 1.5 months, which was ambitious but worked.
- Start as a contractor as main job OR plan and start pre-retirement (buy/build camper?)
This was the most important goal of last year. We now nailed down the period during which we are free from work. So I will count this as a success, although I will still be working in January and February and we did not buy a campervan yet.
- Finish rental house and make sure it is rented
- Have a revenue of at least 1,200 from writing articles
Big fail, and after I read the book ‘Atomic Habits’ by James Clear, I realized that this goal is entirely wrong. Though I aim to make writing an important side hustle, by focusing on the income I will not become a better writer. In 2021 I will not care about the income from writing, I just want to practice it and become better at it. I will define a better goal at the end of this entry.
- Eat more healthily/sustainably
I was struggling with this one. I did not drink coffee for two weeks but did not notice anything different, so I just continued drinking coffee this year since I like it. I did however try drinking as little alcohol as possible starting in July. This was a much better idea. This year every morning after I drank as little as one glass of alcohol, I felt bad: tired, lazy, and worst of all unmotivated. Since July I drank almost no alcohol. This felt good. I do not want to force myself to quit entirely though.
Equity in rental house 70,000
Total net worth 250,705
Over a quarter million euro, up from 204K. Last year I said that I did not expect my net worth to increase by another 50k anytime soon, but this almost happened again, during a pandemic, which is very surprising.
I am phasing out my crowdfunding holdings, since it was a very small part of my assets and it’s just not worth the hassle. We upped our cash holdings because of our sabbatical plans. We need to buy a campervan and be able to last 2021 with very little income in the worst case.
2020 income and spending
Note: This is only my part of the spending. Since I share almost all of these with my wife, our family spending is about twice as high.
The biggest difference in our spending is that we spent very little on travel this year. Our groceries spending on the other hand went way up. This was influenced by multiple factors: we did not visit our families so much, and usually we eat at their place when we visit them. Also, our daughter started eating much more than she did previously. And we did not try to keep our grocery spending in check, I’m usually the one who does the shopping and I spent quite lavishly on luxury food items this year.
I have no clue what our spending will be in 2021. On the one hand we will move out of our rental apartment, on the other we will buy a campervan and I will need to factor in a monthly depreciation on it. Travelling in a campervan CAN be quite cheap, but I have no idea whether we want to stay on paid campsites, somewhere in nature or maybe do some house sitting once in a while. Fuel costs can be quite large as well if we drive a lot, but food costs will probably be comparable to this year, or maybe a bit higher since it is more difficult to build up a pattern of good value-for-money food consumption when you’re travelling.
Targets for 2021
- Achieve a positive savings rate
This one might be ambitious, and I have no idea whether it is realistic while travelling 2/3 of the year, but we will see.
- Do sports at least once every two days on average
Not sure how this combines with travelling, but of course my racing bike and running shoes are joining us on our trip!
- Empty house and allocate all our stuff
To campervan, to parents (storage, but as little as possible), and sell almost all of our furniture. This is a prerequisite to moving out of our apartment so it’s almost certain that we will succeed, but still it will be a lot of work.
- Start sabbatical
If the new baby is healthy enough also start travelling. We will see how this goes with the covid situation, but travelling by campervan will probably be the most resilient way of travel in the near future. Maybe travelling will be very difficult with new covid restrictions, in that case we need to come up with an alternative plan.
- Write at least one paragraph of text every two days on average
No revenue targets anymore, writing should be fun! I’m closely keeping track of this, and yes my entries in this journal count as well! (even though they are much more like braindumps than articles and are usually of a relatively low quality compared to my other work)
- Create a plan for 2022
Will we start new jobs? Where are we going to live? Somewhere with a low cost of living or close to friends and family, or both if this is even possible? Will I start as a contractor, search for a ‘regular’ job or start a business? Buying more rentals and renovating them? Should we quit our current jobs and extent our sabbatical? All these questions need to be answered during this year.
All in all, this year will be a very open year with regard to experiences, jobs, travel and life in general. It is possible or even likely that our lives will take a twist this year. I'm working on it so that this twist will be a positive one. As I said, the first big change is already imminent: our son will be born in January. At the moment we are mostly preparing for this and hope he will be healthy.