Month-End: May 2022

With the market turmoil we’ve seen I’m reminded of: “Happy portfolios are all alike; every unhappy portfolio is unhappy in its own way.” It’s been a bit like that for me – some up and some down and most quietly, plodding on without any drama. It makes it slightly boring – but I need a bit of boring from time to time.

May was pretty amazing for us as a family. Lots of good weather, fun adventures and time with friends.

We went camping which is always great – except when it rains or is too hot or too remote or too busy, too many midgies or weegies or Neds or louts, mouths and other people’s kids.

Fire – humankind’s first friend

That’s pleasure, now let’s talk business.

Net Worth

The headline number of our Net Worth was up about £1,700 over the month – but given how jittery the stock markets have been, it’s within the margins of uncertainty – so essentially we gained nothing and lost nothing over the month. Except of course inflation took a big bite out of the purchasing power of our money.

It’s nice to have set a new record high net worth though – the urge for unbroken growth is hard to sate. I always want more!

Spending

Total outgoings were about £4,700. Of that childcare was £900, household spending was £1,400 and everything else £2,400. Much of that was Easter spending in London and clothes too. I got our car insured for about £150 – nice and we spent a bit on the house in anticipation of our guests’ arrival.

We also now have interconnected heat and smoke alarms – which is the law now in Scotland. Except you can’t seem to easily buy them anywhere – we got ours from a tropical rainforest company that specialises in selling things in brown boxes.

FIRE-Proof Futures and Gold Plated Pensions?

I’m lucky enough to have a final salary pension which is worth around the personal allowance if paid – but it’s only accessible to me once I’m 60 (or if I die, the Lady gets half of it and the kids 20% each. I don’t let her know that in case I’m worth more dead than alive!) And the agreement is that the pension will rise by RPI each year up to 7% and if inflation is higher than that, the trustees can increase it by more than 7%.

I always thought that it was a good deal since RPI is about 1% higher than CPI and over say 40 years, that 1% difference compounds £10,000 into either £32,600 or £48,000 – a huge difference. So RPI = Good and I never thought that the inflation would be a concern. UNTIL NOW!

Since inflation is above 7% and if RPI hits say 12%, my pension might take a 5% real terms cut!

Still, there’s not much to do. I was tempted to sell the pension years ago and even got the CETV (wrote about it too) but decided that there’s no such thing as a free lunch and there’s no such thing as a final salary pension anymore – so I’d never, ever sell it. Actively managing your finances is all well and good but the pension provides me with a floor that I know I can rely on.

Income

Income has been steady as she goes.

Dividends

My side hustle was quiet this month but I took in £2,600 in a few big dollops of good luck or canny savviness. My shareholding in Greencoat wind paid about £500 in its quarterly dividend bumping the total figure to £3,400 for the month. I got a £100 dividend from my VCTs which has meant that their net cost (after sales, dividends and tax relief) is Zero – meaning I’ve been repaid all the initial investment.

I still have a few VCTs to sell that are proving difficult due to them raising capital (and not buying back shares) but we are fine for cashflow at the moment, so it’s not a problem.

Let’s talk Government Policy

Hooray, we’re all getting £400 in free money for our heating bills. But… couldn’t that money be better spent? I did suggest but Rishi Rich didn’t listen.

Maybe on giving me the VAT cut on loft insulation (£240 spend for me) that you sort of promised back in March but turns out you don’t get it if you DIY.
So, £400 for free, 5% VAT on gas and electricity and 20% on things that actually save money and 5p off a litre to encourage us to drive if we don’t feel like availing of the £10 cut in air passenger duty.
This Tory government is out of ideas – the party is over!

10 Rolls of the insulation
A well laid loft will save pounds oft

Dishwasher News

Our dishwasher developed a fault and the good people at Brand X came out to fix it but have decided that it’s a write-off. It’s a logic error due to it detecting a leak that isn’t there. It’s the same fault we got on the old machine that we had for a week or so before it was replaced. We are now to get a new one again and until then, it’s all handwashing.

How to make £350 a month the hard way?

We are hosting a Ukrainian family (mother and daughter) and they’ve been with us for about 2 weeks now. So far, so good. They are nice pleasant people and the kids is the same age as the Master. We have organised their Benefits (Universal Credit deserves its own post), got the kid into our nursery with a funded place, even got a school place for August. I’m pleased with the response or more specifically the individuals who have all helped make everything as smooth as possible.

They’ll be with us until at least Christmas I hope.

FIRE Figures

Due to high spending, our lifestyle is unsustainable without the constant injection of cash from paid employment. But, even based on our high spending, we have about 23 times annual spending. Kick-out the childcare costs and it’s up at 28 times. On our FIRE Funds (pre-pension cash) we’ve about 9 years of spending – which would bring me up to my late 40s.



That’s it from me. I’m really busy right now and can’t be bothered posting. I’d like to say more but I don’t know what to say. Our Ukrainian guests have made me rethink some of my navel gazing and focus on the bigger picture. I have a beautiful family, lots of good friends and live in a great neighbourhood.

What more could you ask for? And if I can share that with people whose little corner of the world has been destroyed by a modern day Gitler – all the better.

Thanks, GFF.

2 Comments

  1. Fantastic to hear you are hosting a Ukrainian family – I don’t know anyone else who is. I hope it works out for you and them.

    Same, my portfolio has only shifted a little despite all the apparent turmoil in the markets, no drama, quite boring really.

    Liked by 1 person

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