Month-end accounts: November 2019

November has been a great success for us on a variety of fronts. The kids are happy and well settled into nursery. Our jobs are going great and the family finances have never been better.  But what storm clouds hang over the horizon?

The future is always uncertain and when you think that it is fairly predictable be prepared to be proven wrong.

So things are looking good for us right now. The Lady is back in work and even had two business trips in November to Europe. The shoe is on the other foot now it seems but I genuinely enjoyed my time with the kids while she was away but earned an appreciation for how hard it is on your own with two kids and how my past job was so difficult for her.

My job is going well– sure, I do have a bit of the impostor syndrome going on and I’m back at a company that I used to work for, meeting up with old colleagues and I’ve not been asked to leave the premises yet. So far so good.

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Family Finances

Combined with gentle markets and strong earning our net worth jumped 1.4% in November to an all time high. Furthermore, our FIRE funds breached a new level and hit a record high!

Fire Funds are what I call our money which is free from pensions and ignores home equity (as in it can be spent now) and it’s this indicator that is the best gauge of being FI. Pensions are great as I’ve said but they are a long way off (there’s even the state pension which some count and I have my doubts). Seeing this number rise after a few months of stagnation as our costs ramped up and incomes stagnated and markets floundered is reassuring. Onwards and upwards I hope!

Last month saw strong income from both the Lady and myself – especially from business mileage which was in excess of £2500 (the joys of a long commute!) Dividends were good and company spending was low – just the way I like it!

Outgoings / Expenses

Around £5500 all in. Not frugal at all and it’s hard to say where it all went without just giving just a long list of pain and excuses; it’s either an allergy or intolerance! Childcare was over £1500, housing costs around £600, about £500 by Lady for work spending on her business trips that should be repaid in December – but we’ve a roofers bill and Xmas then so it’s all swings and roundabouts. We also paid for the rest of our ski holiday which was a sizeable amount plus I’ve been burning a lot of diesel on the way to and from work (about £16-£20 a day!)

Dividends

Dividends of £2500 more or less for November mainly from £1000+ from VCTs and P2P lending – the majority of which came from Abundance. These dividends are from our investments and from the company – which I treat as income.

KPIs

The graph here shows our moving average income – after tax (blue) and spending (red). A picture says a thousand words and what is very noticeable is how our family income has always exceeded our spending. Even with having two kids (kids can save you money don’t you know) and losing income in different ways we’ve keep an even keel. The little uptick in income at the end should be the start of a wave of money coming in from the new company. That should mean that we build up our FIRE Funds in record time.

There’s no easy way to say that by spending £5500 a month that you can actually achieve FI unless you are already a multi-millionaire. But our savings rate was 34% on the month and that was an improvement on the 6 month average. Our withdrawal rate was 7.0% or 4.8% on a 6 month average and over 16% on our FIRE Funds. If you take out childcare and work related costs then the numbers do look a lot better but let’s not sugarcoat it – we spend a lot as a family.

The Future

The new job is settling in well and I’ll be able to pull of more out of the company in December. I get paid for November this week so that’ll help. I’m also going to invest in VCTs to negate some of the tax liability that we have. Childcare costs should reduce in the new year and we should have lower spending over the next 6 months – I hope anyway.

Conclusion

I’ve not really said enough about our Family situation but I’m really pleased with how the kids have settled into our very expensive nursery. They are happy, stimulated and cared for which is as much as your can hope for!

Work-wise, it feels like a long march forwards for us all. The hours are long and having two kids and two jobs is not an easy-combination. I’m lucky to be married to a very strong person. Without these things it wouldn’t make that much sense getting up at 4:40 am every morning. But just as the days are now dark, soon the solstice will come and the days will get longer, lighter and warmer.

Thanks,

GFF