Recent Updates Toggle Comment Threads | Keyboard Shortcuts

  • eurfi 23:10 on 2017-04-03 Permalink | Reply  

    March 2017 – Net Worth and Expenses 

    During March I had the impression it would be a slow month (meaning: not much progress), but in the end it turned out 2.3 % gain.

    • brokerage accounts 302.8 (+3.5k)
    • ETFs 14.2k (+1.3k)
    • cash 19.7k (-3.7k)
    • alternative investments 39.7k (+5.9k)
    • taxes 0
    • total 382.3k (+8.2k) [+2.2%]

    Like last month, if there are changes in “cash” and “alternative investments” I bought or sold some investments (similar to peer-to-peer lending).

    Monthly Expenses

    • January 5.2k
    • February 2.5k
    • March 2.1k (Update: 2.5k)

    I really tried to stay below 2.0k, but I didn’t make it. I had some purchases, that I delayed or didn’t make, but in the end I was about 130 Euros over my goal. Update: I forgot one expense (it was on credit card and the bill came on 5th of April). We are going on a cruise soon and I partially paid for the trip.

    Quarterly Goals

    Every quarter I set some goals (or more like a direction) for the upcoming quarter. In Q2 I would like to spend more time with my kids outdoor (in the forest or by bike). Another topic is “simplify” – I would like to get rid of some stuff. My wife already sorted out her clothes (a huge pile). I have a hard time to say good bye to still functional clothes. (Although my wife has sometimes a different opinion about what is still okay and what not.)

     
  • eurfi 20:07 on 2017-04-01 Permalink | Reply  

    March 2017 – Options Income 

    Like mentioned last month, I opened a new account and trade a similar strategy. The starting capital is 20k (US Dollars).

    Far OTM option selling (MTM)

    • January: +1.9k
    • February: +0.5k
    • March: +0.9k

    Far OTM option selling (closed trades)

    • January: +1.6k
    • February: +0.8k
    • March: +0.4k

    Second account (MTM)

    • March: +0.3k

    There are no closed trades yet in this account.

    March was in line with my expectations. I did not trade the full position in my second account (testing waters). In an average month I expect to earn 900 + 400 (MTM – market-to-market).

     
  • eurfi 9:58 on 2017-03-24 Permalink | Reply  

    To Sprint or not to Sprint 

    At the end of December I talked about my last free day (I was working part time then). I also outlined my plan about a “sprint to the finish line”. With “conservative” numbers I ended at my target net worth number (600k) in mid 2020. Now, “conservative” meant around 1 % return per month. I’m selling options, so 1 % is certainly achievable, but no given.

    Also, to quit my job earlier I wanted to build a second income stream. I had this plan for a very long time now (years), but still have almost nothing to show.

    A few weeks ago I had an epiphany: Could I already live like in FIRE, while still working? (My work is very relaxed.) And what would it look like if I had no stock market income at all?

    So I calculated with (almost) no stock market income (just around 2 % per year) and reached 600k end of 2022 – only 2.5 years more! (With around 4 % per year I get there end of 2021.)

    I also made a list of things I would like to do when FIRE (spending time in nature, spending time with my kids, programming on private projects, eating healthy, sleeping enough, not stressing about money). And a lot of them are at least somewhat possible even now.

    So I decided to not (aggressively) pursue my second income stream goal. I will still program on my side project, but mainly use it for my own.

     
  • eurfi 23:47 on 2017-03-02 Permalink | Reply  

    February 2017 – Net Worth and Expenses 

    February was a quiet month. In my brokerage accounts I’m mostly in cash – so no risk, but also no income.

    • brokerage accounts 299.3k (+0.3k)
    • ETFs 12.9k (+0.9k)
    • cash 23.4k (+8.0k)
    • alternative investments 39.7k (-4.6k)
    • taxes -1.2k
    • total 374.1k (+4.5k) [+1.2%]

    Monthly Expenses

    • January 5.2k
    • February 2.5k

    Like I said last month, our expenses should be around 2.5k each month. Notable expenses were 410 Euros for car inspection and 160 Euros for IKEA. Maybe March will be a very cheap month – below 2.0k might be possible.

     
  • eurfi 14:25 on 2017-03-01 Permalink | Reply  

    February 2017 – Options Income 

    January was a very good month. In February I let it slide. I did not follow my own rules and was under-invested. So the result is also lower than usual.

    Far OTM option selling (MTM)

    • January: 1.9k
    • February: 0.5k

    Far OTM option selling (closed trades)

    • January: 1.6k
    • February: 0.8k

    In March I will report about a second account, where I trade a similar put selling strategy. The starting balance is 20k. All numbers are in US Dollar.

    Like I said above, I did not follow my own rules in February. I did not open new trades as soon as old trades expired (thought the market is too high, IV too low). And there even was a period of 10 days where my account was empty! In my backtests I reopen on the same day of the exit. I even tested waiting one day – it results in less total profits. But still, in real life I think I’m more clever. This is an area I’m working on.

     
    • Investment Hunting 7:34 on 2017-03-02 Permalink | Reply

      Great results

      Like

      • eurfi 16:59 on 2017-03-02 Permalink | Reply

        Thanks. Actually I’m disappointed, both about not following my rules and the – in my opinion – not so great result. But the year has 10 months left to make it better…

        Like

    • Kilian 20:39 on 2017-03-10 Permalink | Reply

      Hi, I found you through easydividend’s link. I love how you also care more about MTM than closed trades. In my mind, MTM is the relevant measure. Options’ premium is dependent on the principal – in this case the strike of the underlying. If this underlying erodes, we get less premium. Therefore, reporting both numbers seems to be the sensible thing to do! 😀

      I wish you all the best for the months to come.

      Like

      • eurfi 22:44 on 2017-03-10 Permalink | Reply

        In a bull market (like now) the difference may be small, but in a bear market the difference might be huge (when you were assigned to a much higher price).
        Thanks, February was weak for me. March might be better…

        Like

  • eurfi 0:11 on 2017-02-02 Permalink | Reply  

    January 2017 – Options Income 

    A few weeks ago I came across the blog Options Hunting. The author compiles a list of monthly income by selling options. As I mostly sell options (I also have a few dividend stocks, mostly REITs), I wanted to take part in the friendly “competition”.

    I also found a German blog with another list: Easy Dividend.

    As this is my first monthly post, let me explain a little bit what I do. I have a simple strategy, were I sell far out-of-the-money options on the E-Mini S&P 500 futures. These options usually have 90 – 110 days left till expiration and I select the strike price to get a premium of 4 – 5 dollars. My profit target is 50 %. I have roughly 40k in the account (this account is in US Dollar – my other accounts are all in Euros). My expectation is around 2 % per month.

    With my main accounts I do complex options positions. These are multi-legged constructs. An Iron Condor is such an example (which I do not trade – I do not want to go into too much detail).

    Currently, my book keeping is not good enough, so I can only give MTM numbers from month to month. But this also includes dividends, stock gains and EUR/USD gains. So for the moment, I will leave this part out (the MTM numbers are in my net worth posts). But I plan to later include it – especially because the account size is bigger there.

    Far OTM option selling (MTM)

    • January 2017: 1.9k

    Far OTM option selling (closed trades)

    • January 2017: 1.6k

    January was a fabulous month. I gained over 4 % – double what I normally would expect.

    I only look at MTM changes and don’t care about closed trades. But I mention them here, because all the numbers of other traders seem to be based on this.

     
  • eurfi 20:44 on 2017-02-01 Permalink | Reply  

    January 2017 – Net Worth and Expenses 

    The first month of the new year is already over. I changed some accounting tactics and January will be from now on a very expensive month. In the past I “distributed” certain expenses (pension contracts in this case) evenly over the year. I pay them in January and from now on I will fully book them in January.

    In a comment on 1500 Days I mentioned 370k as our current net worth. Was a little bit too optimistic, but close enough to count as rounding error. I missed it by 400 Euros:

    • brokerage accounts 299.0k (+3.5k)
    • ETFs 12.0k (+0.0k)
    • cash 15.4k (-7.7k)
    • alternative investments 44.3k (+9.0k)
    • taxes -1.1k
    • total 369.6k (+3.9k) [+1.1%]

    Monthly Expenses

    • January 5.2k

    In 2016 our expenses were 35k (34.7k). In 2017 I hope to be around 33k. So, apart from January, our monthly expenses should be around 2.5k to reach this.

     
  • eurfi 10:49 on 2017-01-21 Permalink | Reply  

    Answering questions about my part-time work 

    Whenever I feel a little bit bored and sitting in front of my computer I browse the “Ultimate List of Blogger Net Worth” for new entries. And so I stumbled upon http://retireinprogress.com/. I commented on his post about working 80 %. He starts working 4 days a week in January 2017, for me it ends.

    After some back and forth he asked some very interesting questions, that warrant a longer answer:

    Do you consider your part-time experience a failure for your entrepreneur endeavor or for your overall life quality?
    What I read is that you ended up being lazy in the 20-40% time you got back compared to a 100% position. What makes you think that when fully FI you won’t be lazy? What makes you feel that when fully FI you won’t fill your life with small chores, errands and meaningless activities?

    The answer is not easy or straight-forward for me. Let me explain my current situation a little bit: I’m feeling very stressed. Time is too limited between multiple jobs (“main job”, side job, side hustle, active investing) and family and house. We prioritise the kids very high, so besides working almost everything else is neglected (e. g. house is dirty, chores get done on the last minute). I see this with worries. My wife not so much – she thinks everything is “fine”.

    I would like to escape this stress by quitting my main job. This would give me plenty of time for all the neglected stuff and also for my interests. After talking with my wife about this, there are two ways for me to achieve this: net worth over 600k or having a “business” with at least 1,000 Euros profit a month. If all goes like planned, we might have a net worth of 600k mid 2020. This would mean 3.5 more years to endure. So, the business option could be a short-cut time-wise. I’m still working on it, but time is more limited than last year.

    Now, with the stage set, let’s answer those questions:

    Do you consider your part-time experience a failure for your entrepreneur endeavor or for your overall life quality?

    Yes, it is clearly a failure for my entrepreneur endeavors. My overall life quality was better. But having the goal to work on your business and in the end not doing it, gives you guilty conscience. So I did not fully enjoy the leisure days.

    What makes you think that when fully FI you won’t be lazy?

    Isn’t that the point of being FI? Joke aside, I have a lot of interests, that are parked now, because I don’t have the time. I’m quite certain I would work on them. And I would spend more time during the week with my kids.

    What makes you feel that when fully FI you won’t fill your life with small chores, errands and meaningless activities?

    I guess a big part (at least in the beginning) would actually be small chores and errands. There is so much neglected. Every room I enter I see stuff that should be done. 2017 I would like to work more on these things, because some of them can be done while working full time. It is a matter of organisation (and goal-setting).

    Sorry, this was a lengthy post and in the end I’m just hoping. Nobody knows how it is really going to be. I accept the critic that my free days 2016 showed a more lazy future. I counter that with a need for decompression. After that period I will be productive again.

     
    • Mr. RIP 11:34 on 2017-01-21 Permalink | Reply

      Thanks for your answers EurFI, the picture is clear now 🙂
      I can see that with just a single extra day available per week you’d just do urgent but not important stuff and will reach your long term goal later, which is not good for now.

      Like

    • Team CF 15:58 on 2017-01-26 Permalink | Reply

      Same as you, I’ve too many things I would like to do and feel that when FI I would finally have the time to do those. I have absolutely no worries that I can fill my time (and then some). You would also have the ability to schedule all these things the way you want, this gives the feeling of freedom which is something I also look forward to in FI.
      What will likely happen is that Mrs. CF will continue to work (because she loves it), while I persue other opportunities. Might already happen in 2018….well before FI!

      Like

      • eurfi 18:53 on 2017-01-26 Permalink | Reply

        Already in 2018 – congratulations.
        I have (theoretically) this possibility as well. But I need another income stream with about 1 – 1.5k per month. Then my wife would let me leave my jobs and pursue the business. Currently at zero, unfortunately.

        Like

    • Financial independence 3:26 on 2017-02-01 Permalink | Reply

      First of all – many thanks for sharing. i would perceive 600k a risky scenario , as it does not seems to cover higher/cumulative inflation over time, potential loss and fact that it is much more difficult to get a job once you have been out of it for a significant period of time.

      as we have similar situation st home in regards to chores , i think it is matter of priorities and something will always take precedence, as they are already low on priority list. this needs to be sorted in the current constrains, if considered important.

      Like

      • eurfi 21:40 on 2017-02-01 Permalink | Reply

        I agree with the 600k. Especially after I now realised, that our FIRE spending won’t be 2.1k (as originally expected), but more like 2.6k. On the other hand, leaving my job will open new income opportunities. And as software developer (who intends to continue programming) I will find a job again. I’m convinced I could make a killing as freelancer (if I wanted to work full time).

        So, I consider 600k as a starting point for discussion, where I could (and probably would) leave my job. My wife wants to stay – even better for the math.

        Like

  • eurfi 23:15 on 2017-01-09 Permalink | Reply  

    2016 – Yearly Expenses 

    While 2015 was financially spectacular, I did not achieve similar results in 2016. In the beginning of the year I bet on a rallye (didn’t happen) and in the final month on the year I bet on a decline (also didn’t happen). So I lost needlessly money. In between were some good months, so in the end all was okay (but not spectacular).

    2012 – 2016 in comparison

    But in this post we talk about the expenses, so let’s compare the years:

    • 2012 – 42k
    • 2013 – 44k
    • 2014 – 33k
    • 2015 – 34k
    • 2016 – 35k

    I was expecting rising expenses and wanted to stay below 36k (stretch goal was to stay below 2015’s level). For 2017 I’m expecting slightly lower expenses (around 100 Euros each month).

    Expenses by Category

    • pension payments – 18 %
    • children – 16 %
    • housing – 15 %
    • groceries – 13 %
    • car – 7 %
    • travel – 5 %
    • clothes – 5 %

    Children related expenses jump from the 4th place last year (13 % back then) to the second place this year. We did more vacations than 2015 (or at least paid more for it) and my wife bought a lot of clothes (for our standards).

    Goals for 2017

    • yearly expenses below 2016 level
    • net worth of 450k

    I have not really thought about other goals. So maybe I will add some during the year.

    Savings Rates for 2014 – 2016

    Reader Niterainbow asked about my savings rate. I could not answer it, because I never calculated it. I was very interested in this as well:

    • 2014 – 38 %
    • 2015 – 41 %
    • 2016 – 41 %

    For 2017 I predict over 50 %. As I’m now working full-time again we will earn more. Above 50 % is a nice number!

    What is even more interesting (at least to me), is that in all 3 years our expenses would have been covered without my salary. I calculated it like this: yearly net worth gain – my net salary. This number was positive even in 2014 (were the net worth gain was only 33.4k).

     
    • MustardSeedMoney 4:49 on 2017-01-11 Permalink | Reply

      Wow that’s incredible that you have been able to keep your expenses trending down and keeping your savings rate so high. Awesome job and I can’t wait to you hit your 50% savings rate!!!

      Like

    • eurfi 0:11 on 2017-01-12 Permalink | Reply

      Thanks. The drop from 2013 to 2014 is about our move into our house and a change in health insurance. So when we ignore these “other” years. The expenses are going up from 2014 to 2016. 😦
      But this is okay, because I believe 2017 can be cheaper than 2016.

      Like

    • Team CF 15:53 on 2017-01-26 Permalink | Reply

      Pretty impressive 2016 and cool to see the developments of the last few years. Good luck jacking up the savings rate to over 50%.
      Oh, and stop timing the marget 😉

      Like

      • eurfi 18:56 on 2017-01-26 Permalink | Reply

        Thanks.
        Why should I stop my active investing (I’m mostly selling options)? My 2015 result catapulted our finances to a new level. I will put even more effort in it. There is a lot of room for improvement (and potential).

        Like

  • eurfi 21:32 on 2017-01-01 Permalink | Reply  

    December 2016 – Net Worth and Expenses 

    Back in November I started a bearish leaning trade that did not work out at all. It had the potential to destroy my goal of reaching 360k net worth by the end of the year. But it turned out well – I made it!

    • brokerage accounts 295.5k (+2.5k)
    • ETFs 12.0k (+1.5k)
    • cash 23.1k (-26.8k)
    • alternative investments 35.3k (+0.1k)
    • taxes -0.2k
    • total 365.7k (+7.6k) [+2.1%]

    I had to pay my taxes for last year. ETFs gained nicely.

    Monthly Expenses

    • January 2.8k
    • February 2.6k
    • March 3.4k
    • April 3.7k
    • May 3.3k
    • June 3.2k
    • July 2.9k
    • August 2.6k
    • September 2.9k
    • October 2.7k
    • November 2.5k
    • December 2.4k

    December was a cheap month, despite the usual Christmas gifts. Our yearly expenses were 34.7k – well below the target of 36k. I have some error in my accounting, running expenses are always higher than the final number.

    I will talk about the full year numbers in a detailed post. Yearly goals will follow too.

    I wish all my readers a happy New Year and a successful 2017.

     
c
Compose new post
j
Next post/Next comment
k
Previous post/Previous comment
r
Reply
e
Edit
o
Show/Hide comments
t
Go to top
l
Go to login
h
Show/Hide help
shift + esc
Cancel