Summer 2019 Update

I’m writing this “on the road”. Our whole family is touring Europe in our (now one year old) camper van. We are still very happy with the car and the freedom and joy it brings us.

Financially 2018 was a very bad year and it kind of destroyed my plans for retirement in the next few years. It erased the gains of two years (including the car purchase).

I had some bumpy periods before and usually I was more conservative afterwards. It should be the same this time.

I’m still working full time (except one month in Summer).

So, life is good, but not much to report on the blog.

Increasing Expenses

Lately I’m thinking about increasing our expenses. I consider spending more on food. In my mind organic foods costs roughly 3 times the “normal” price (the difference is smaller for some categories, but even higher for others – meat).

But for health reasons I would like to spend more. It doesn’t have to be (always) organic, I would rather prefer smaller producers near us. We live in a region where this is possible.

Our yearly expenses are on track for 36k. It is certainly higher than the last years, but in line (from 2014: 33k, 34k, 35k, 34k). I guess most of the increase is coming from our car. I do not include the initial price of the car here.

Our monthly food spending (groceries) is around 400 Euros. I guess this might increase to 700 Euros (which is around 4k a year).

November will be the first month where we spend more, let’s see how it feels…

 

October Update

Options Trading

I do active investing. I’m mostly selling options. Some structures are far away from current prices, while others are more current.

In February 2018 I lost a complete account, because I had too much far away positions in it. Two other accounts survived it just fine.

In October 2018 there was a similar (but much smaller) situation. This time I had no positions on, that where near current prices (we option traders call that ATM – at the money). My two accounts with the far away positions did suffer, but they are still fine.

For almost all of my option trading friends the October situation brought sizeable losses and a lot of them did realise some losses. As I had nothing on, it was not stressful at all to me.

Camper Van (and Kids)

We are still enjoying the camper van and used it several times already (weekends). My kids like it. It is like a second flat. I could sell the big house and live in a much smaller flat and enjoy the freedom. But, of course, it will never happen. My wife likes to live bigger and of course every kid “needs” to have his own room!

Years ago I was in a museum, where older people were talking about their childhood. Back then it was normal, that two kids would sleep in one bed. An own room was not even talked about. I sometimes joke kids do not need an own room – they like to sleep in the parents bed and play in the living room. (I’m sure, this changes at some time, but I still have to experience that change.)

Working Time

I’m working full time for almost two years now. It was part of my “sprint to the finish line”. Which I’m no longer convinced about (see the last posts). So I’m thinking again about reducing my hours. I find it hard to give up the extra money. You never know what the future brings and it might never be as easy as it is now.

 

Falling Victim to the Diderot Effect

After buying our camper van I felt victim to the Diderot effect. The new car “needed” lots of small electronics (power plugs, converters, 4G router, …), kitchen stuff and sleeping textiles (pillows, blankets).

And with AliExpress I found a fountain of ideas to purchase (if only it wouldn’t take so long to deliver).

Of course, all these expenses are a danger to my goal of FIRE. But after loosing so much money I’m more relaxed in this regard. I want to enjoy life more now and not just in FIRE.

My goal for our yearly expenses (the car itself not included) is below 36k. The running total (for the trailing 12 months) so far is rising (May till August were expensive months) and around 35.5k already. It is still possible, but not really looking good.

How Loosing 100k changed my Life

Well, the 100k are not entirely true, but it sounded so nice…

In February I lost 60k (compared to January). One of my options accounts was completely eliminated by the rising volatility in early February.

This made me think.

So far I was in a “sprint to the finish line”. Now I saw that the markets are clearly not an one-way street. And living off from my investment income might be more problematic than I thought.

After a few iterations I will now probably work longer (more years) than I initially hoped. And now I’m looking for ways to make these years more pleasureable.

Long story short: We bought a camper van! (That is the remaining 40k “loss”.)

We already spent a month (summer break) with our kids in it. We like it very much! Before we bought it, we did a test run with a rented car (for a week). That was in May.

I could sell the house and only live in the van, but of course my wife and children have a different opinion. 🙂

 

Spending Summer Break with my Kids

I have worked part time before, but returned to full time work (I called this my sprint to the finish line). Working every day and seeing the kids only for a few hours (on some days maybe only minutes, not hours) has its price.

So in looking for new ways I decided to take one month off of work each year and spend it with my kids (and my wife, if she can join). For 2018 we are planning a road trip through Europe. Later years we might just do shorter trips in our home country or even fly to the US.

In 2016 we almost bought a camper van. Of course I still have this wish (and will probably buy it, once retired). And for our road trip this year I was checking prices again. But no matter how I calculate, it is still a few thousand Euros more per year than our current car. Let’s say it is 5,000 Euros more per year. Now, how many nights are we realistically sleeping in the car? Maybe 50? This would be 100 Euro per night – you can get an Airbnb almost anywhere for this price.

So, maybe the camper van would add more stress to our life (having to “use” it). And “more stress” is the least desired thing I would want…

Happy New Year

In September I announced a break from blogging.  And I really did not look into the blog (I’m proud about that). As always, only during the first weeks I was tempted. Later I did no longer think about it. I also read fewer personal finance blogs (I unsubscribed a few in my RSS reader).

During the months I continued my book keeping. I will no longer publish my numbers regularly – what’s the point of it? My savings rate for 2017 was over 50 % (and between 38 and 41 % in 2014 till 2016). The yearly expenses were quite stable (between 33k and 35k in 2014 till 2017). So the increase in savings rate came from higher income. I was working full time the whole year (and part time in 2015 and 2016).

I have read a few times about the stages of FI. Most of the blog posts have a high number of beginning stages, but later is a huge gap before reaching FI. With a net worth of around 425k I’m more than halfway there. There is no longer the question if I reach FI, it is more when. And even if I do not generate extra returns from the stock market, the monthly surplus from our working income will get us there. Plus, my wife does not want to stop working, and we could almost live from her income (and my side job). But as I earn way more than her, it is not so easy to quit (she feels more secure with both incomes).

In the last few months I started listening to two podcasts:

• Choose FI
• The Voluntary Life

The future of this blog

I will stop my monthly net worth reports (and also the options reports). But I will blog from time to time. Whenever I feel like it. Be it only once every few months, or a few times a month. I have some thoughts about the future (and my kids) that I would like to share. Also, “Second Generation FI” (as coined by Choose FI) is very interesting to me.

 

Blog paused until end of 2017

The (few) regular readers might have noticed that I only post the monthly net worth and options income report. All other types of postings stopped a few months ago.

I thought about stopping this blog, but then decided to keep the monthly reports. I was not sure if I would stop the accounting for myself, so I still reported my numbers on the blog.

Now I’m pausing all blogging. I will re-evaluate at the end of the year whether I will continue with the monthly posts (e. g. if my accounting slips), reduce the frequency of my number reports or if I maybe stop blogging completely.

My main reason is my lack of (free) time. Kids, an house and (multiple) jobs leave too little time for myself. While I enjoy writing my numbers down and seeing some visitors and even getting a few comments, the time is ultimately better spend on other ventures. My ultimate goal is freedom (from a day job) and so (paid) work is bringing me closer to this than blogging.

I will not stop my journey. I’m on a very good way and end of 2022 should be the latest date where I reach my goal. If all goes well it could also be end of 2020.

August 2017 – Net Worth and Expenses

May (-200) and July (+100) were two months with no progress. I’m glad that August shows a healthy gain of almost 1 %. The only sad thing: My stock market activity did not contribute to that.

• brokerage accounts 292.3k (-0.5k)
• ETFs 17.7k (+0.7k)
• cash 20.3k (+5.5k)
• alternative investments 62.2k (-2.0k)
• taxes 3.5k
• total 396.0k (+3.8k) [+0.97%]

Monthly Expenses

• January 5.2k
• February 2.5k
• March 2.5k
• April 3.3k
• May 3.1k
• June 2.1k
• July 2.3k
• August 2.1k

August was the cheapest month so far (a few Euros below June). An yearly total of 33k seems achievable.

August 2017 – Options Income

I opened another account, that I will also track from next month on. August was the first negative month for my strategy. But July was exceptionally good.

Far OTM option selling (MTM)

• January: +1.9k
• February: +0.5k
• March: +0.9k
• April: +1.1k
• May: +1.1k
• June: +1.2k
• July: +2.6k
• August: -0.3k

Far OTM option selling (closed trades)

• January: +1.6k
• February: +0.8k
• March: +0.4k
• April: +1.5k
• May: +0.4k
• June: +0.8k
• July: +3.2k
• August: 0