March 2021 Savings ReportBy Money Mage · · Frugality, Savings
Welcome to our March Savings Report.
It’s been a while. I hope you are doing well. Apologies for being absent without leave - more on that later.
Given my absence, this is the first monthly report in over 18 months that I’ve missed. You’ll have to consider this report a quarterly report.
This time last year was the peak of the COVID crisis for us. Our networth was down 4%. I was terrified about the other-MM’s health risk.
But in good news: we are doing well despite being AWOL. We’re both surviving. The spring air is helping. It can be difficult sometimes to appreciate exactly what you have. We are both extremely grateful.
Anyway, let’s see how the Money Mage household Saving and Investment performance was Q1 2021 (January 2021 through March 2021). You can get all Savings Reports at the best of Money Mage.
January - March 2021 Savings Rates
- SR = Savings Rate
- SRp = Savings Rate inc. Pension
This last quarter has been solid and reliable. Personal Finance should be steady and boring. If you can steadily and boringly save and invest 80% of your income, you’ll probably end up financially free, and be able to retire super early. Boring is good.
We’ve hit our 80% target of savings including pension every month. March was a little down due to various expenses landing: car insurance, car maintenance, car recovery.
I don’t see this changing for the rest of 2021 and into 2022 unless we have an unexpected change in circumstance.
Towards Financial Independence
In November 2020 we hit our FIh number - which means we are Financially Independent if you include our primary residence.
But that isn’t the full story…
This table shows the number of years to achieve Financial Independence in various cases.
- FIh = Years to FI based on Total Assets.
- FIp = Years to FI excluding the house, but including illiquid pensions.
- FI = Years to FI excluding the house and other illiquid assets.
We’re still working on our non-pension and non-property locked assets. They have improved significantly FI was at 17 years this time last year. It’s now at 14 years. If we continue at this pace we’ll be there in 4 years. Interestingly, that’s what monte-carlo simulations of our finances project.
If you are paying attention, you’ll notice January jumped down, and then February back up again. More on that later.
January to March 2021
I mentioned in December I had a bit of a health scare. It’s ongoing. I still don’t feel right, but I’m feeling a little better.
Over Christmas I just didn’t feel right. I was feeling dizzy, tired, drained. I had to stop running. I had a weird rash appear on my legs. I went to the doctors: blood tests, prodding and poking, antibiotic courses later I’m still not fully diagnosed.
They have found is an underlying liver condition that’s not life-threatening. This shocked me. I thought I’d done this to myself having crutched on the drink for many years. But it turns out to be something genetic and “harmless”.
Either way, I can tell something is not right still. I’ve had health scares in the past and got through them. But this uncertainty has shaken me.
You can have all the wealth you like but poor health puts things into perspective.
Truth be told, I’m in a depressive funk over it. Lockdown, undiagnosed health, utterly crap weather in February. The snow at the end of February was the worst since 2010. The car was completely unusable. Not being able to see friends and family didn’t help. The whole work-from-home-cabin-fever caught up with me. I’ve just felt terrible with little external pressure to get me out of it.
And I’m in a fortunate position - I truly feel for those less so.
I’m looking forward to lockdown ending but dreading it in equal measure. We don’t have any huge plans, we’ll likely do a staycation up north. I have a soft spot for the Moray coast. On the other hand, I’m not looking forward to April 26th - the local pubs are going to turn into fraggle-rock.
In other news: work is pushing my promotion. I’ve delayed it during to health woes. But as I’m feeling a little better, I’m going to take it. The team and company are doing well, and I can help it grow. I’m going to ensure there are checks and balances in place so it doesn’t turn into a hell work.
The other-MM had another paybump and a promotion. He’s not had to take on any more responsibility, they were promoting him on the back of work he’s already doing. It does show you can raise a legitimate grievance, have the situation improve, and not get shit-canned. Without the help of a lawyer. I’m happy for him, although I don’t show it enough.
In more good news: The other-MM has had his COVID jab. He has underlying health issues so is on the flu-jab list. His second dose is due soon.
Financially, I’ve capped out my ISA and Pension Allowance this financial year for the first time ever. I’ve also used some unused Pension Allowance which you can backdate 3 years. The other-MM was a bit shy of his ISA allowance but he is doing super-well well for an “average” earner.
I’ve had a windfall at work that I’ve spoken about before. I joined in 2019 and was offered a stock options package. I’ve had stock-option package after stock-option package at previous jobs before so thought nothing of it. The company I work for is now public, so those options are worth something. Quite a lot. They are trading 10x my strike price. I’ve also had a RSU grant.
This means I’m overly exposed to the company I work for. They supply my income and I have a chunk of shares in the business. Shares in a single company are pretty volatile. I’m selling when I’m allowed. Straight into low-cost global trackers for diversity. But how much I sell is a matter of balancing tax liability and allowances. I’ve done what I can this tax year, and I’ll offload more next year. This will take a few years to offload. If they offer me more stock - which they almost certainly will - I’m just going to have to take the >50% tax hit and silly high earner consequences.
The very definition of first world problems.
Year over Year
Year on Year is up a very healthy 45%, which our best years. Taking into account the -4% drop in March 2020 due to COVID, we are still very healthily up.
Here you can see asset allocations this month compared to March 2020.
The rebalancing of our assets out of cash into investments is continuing apace.
The chart below shows the change in non retirement locked investments. A year ago they were <1% of our holding. They are now 14%
Cash is down to 9% of our holdings now. We plan on keeping cash around ~10% of our portfolio going forward.
The end is in sight for our last bit of 0% debt. It’s a 0% loan against some home improvements. This time next year it will be gone, further reducing our outgoings by £250/mo. We’ll be living on less than £1k/month then, with our biggest expense being council tax or food, depending on how fat we are.
This chart shows our net worth growth since the other-MM started work and I graduated.
Our snowball is rolling. Our net worth is up 45% Year over Year, having being down 4% this time last year at the bottom of the COVID crisis.
We’re mortgage free and on the path to take Early Retirement in our early to mid 40s. If we want to. Subscribe now and follow me on Twitter @moneymagery. I hope you like the charts, I am a fan of Tufte*.
How is your journey to FI going?