September 2020

There were 2 posts published in September 2020 (this is page 1 of 1).

August 2020 update

I finally got around to booking a holiday for the family, we found a nice little place near Ravenshead, Nottinghamshire. The same cottage was available on several websites but I opted for dogstrustholidays.co.uk as they get a percentage of the fee to help with the good work they do.

Really looking forward to this break as it’s the first holiday I would have had in four years. As our son is 18, getting on for 19, it might also be the last family holiday we have together before he starts his lads holidays.

Being able to take our dog, Skyla, with us too is great – she will love the change in scenery and there are plenty of places to walk and also dog-friendly cafes and pubs. This will be her longest trip in the car so we didn’t want to book anything too much further from home for that reason, I think it should take around four hours to get there with a few stops so she can stretch her legs.

I reckon it will be nice to get away, going for walks in new and exciting places will be fun for me as well as Skyla (plenty of dog-friendly pubs and cafes apparently)!

Skyla
Skyla in the nearby woods

Work

The month of August, along with September, is one of the busiest times of the year for the product group I am part of. Many colleges and universities are preparing to welcome students back and with that, we see a spike in users of our mobile app. This is great but it also presents some challenges for us…

Ensuring that the platform that the app sits on is reliable and robust enough for the volume of users is one of the main duties of my role. We had a little blip around results day in the UK and we’re doing what we can to try and prevent something like this from reoccurring around admissions time. Consequently, it feels like a lot of my time has been spent around reviewing logs and looking at performance graphs as well as working with developers to resolve anything obvious.

The above, coupled with resource planning and liaising with other teams, can mean that I have little time to progress other requests like implementing new customers. This can get me down and I definitely recall entering a spell of depression as the month ended despite having booked the previously mentioned family holiday.

My thoughts have been heading in the direction of “what can I do to change things”, this did make me feel grateful that I had come across FI/RE and the realisation that there are options available. Exploring other ways to generate income is an ongoing process for me, as you’ll see in a moment.

Here are my numbers for August:

Monthly Figures August 2020
Monthly Figures August 2020

I thought I’d start including my pre-tax and post-tax saving rates, mainly so when I read/hear about other people’s savings rates I have idea of what that looks like comapared to mine.

I’m not using the numbers in a bad way, as a direct comparison, where I can beat myself with a stick over them. It’s more for interest.

Also, the pre and post-tax rates are there as I think they give a better indication rather than just trying to use one set of numbers. It feels more representative in my eyes.

Is calculating your savings rate something that you do, if so, do you work with just one figuring or do you have pre-tax (gross) savings that you make?

I didn’t get to pay too much extra off my credit card this month, mainly due to the increased spending levels. Some of the things that contributed to a high level of spending were:

  • £160 – Overnight stay with my wife at the Wayford Bridge Inn, somewhere we like to go back now and again, and is just a short distance outside of Norwich. We were also able to take advantage of the “Eat Out to Help Out” offer which was handy 🙂
  • £565 :^O – This was for renewing the road tax for my car, I had declared it off-road (SORN) and so paid out for 12 months. This one hurt but in my defence, I hadn’t discovered FI/RE or frugality when I bought this car.
  • £102 – Train ticket for my wife to visit a friend in Shropshire.
  • £31 – Not a huge amount but something I hadn’t budgeted for was a book from Gumroad.

Additional Income Streams

  • Matched betting £168 profit
  • Surveys/studies £19.27

I didn’t get round to listing anything on eBay this month and I’ve sent in all the stock I had for Amazon FBA so there’s nothing new to report on there.

This was my first month of matched betting and it’s something I’m enjoying a fair amount. The profit mentioned above has all stayed within my matched betting “ecosystem”, the money I have deposited in various bookie and betting exchange accounts has moved around as a loss in one place results in a gain in another. The gains can occur on either side of the equation, when I get a reasonable win with a bookie I withdraw some funds and deposit that at the exchanges – being able to carry a high(er) liability allows me to place more bets.

This month I also signed up to Prolific, an online survey provider. I became aware of them from Vicky aka Mortgage Free by the Sea – check out the review on her blog. Essentially, you sign up, complete a load of questions about yourself and then wait for studies to become available. Each one offers a different amount which usually corresponds to the effort required to complete them

Although a fraction under £20 doesn’t sound like much, it’s an okay return on the time I put into it. Most of the studies I have completed have been in the evening when I’ve been in the lounge relaxing so it’s hardly an inconvenience. The proceeds from Prolific will either end up in my Freetrade ISA or my Emergency Fund.

Future Fund

Seond month of monitoring my Future Fund and the value has increased by just over £862 to £90,993. I’ll probably pop in a graph next month when I’ve got another set of numbers to add in.

I am contemplating selling some of my FAANG shares currently held with Hargreaves Lansdown in order to invest the proceeds in trackers & funds with Freetrade, I’m up between £100 and £350 on each of the holdings and I currently think keeping a fair amount of money tied up in tech is not necessarily the safest option.

It is interesting having shares in big tech companies, and Uber, but I know that I’ll feel safer and more confident about my financial future knowing that the money is silently working away for me in trackers/funds rather than all the glam and after parties of Facebook, Netflix etc.

Age Increase for Access to Private Pensions

Photo by Ena Marinkovic from Pexels

Dreaming of lazy days relaxing with a nice cup of tea or coffee pondering what useful contribution you will make that day?

Well, you may have to put that thought on hold, at least for another couple of years, thanks to the government.

From 2028, the minimum age at which those with a private pension can access their funds will rise by two years from 55 to 57. This was originally announced back in 2014 but the legislation was not amended to include provision for implementing the change.

https://www.gov.uk/government/people/john-glen

On the 28th August, Labour MP Stephen Timms tabled the question asking the Chancellor of the Exchequer what plans he has to increase the minimum age at which people can access their private pensions.

John Glen (pictured right), Secretary to the Treasury, responded with the following statement on the 3rd September.

“In 2014 the government announced it would increase the minimum pension age to 57 from 2028, reflecting trends in longevity and encouraging individuals to remain in work, while also helping to ensure pension savings provide for later life.”[1]

This change will affect those in their mid-forties or younger with any future plans of retiring early at 55 or drawing down to supplement their salary will have to wait a further two years. This may not sound terrible, but it does demonstrate that the government are willing to poke their finger into the personal finance pie.

There is no saying whether the government will return to private pensions in the future making additional changes to the age at which we can access our pension.

In my opinion, if I choose to invest money in a private finance vehicle then it should be up to me when I access it, in accordance with the investment criteria that is. Private pensions and investments should provide individuals with options on how they spend their years whether that be working or pursuing other interests.

Mr Glen suggests that the change will encourage “individuals to remain in work” – well, what if individuals do not want to remain in work? If we have worked hard and invested wisely, it should be our decision to make. Some may be happy to stay in work and that’s fine, nothing wrong with that at all, but others there may be something else they want to try out to increase their happiness and wellbeing.

Despite my feelings on this I will continue to contribute to my private pension, I still feel like it is the right thing for me to do at this time, plus it would be silly of me to not take advantage of my company matched contribution too.

I will, however, be reviewing my numbers and adjusting accordingly to accommodate this change. I expect it will mean that I will need to depend on a higher level of income from my ISAs for those two years if I am at the point of Financial Independence by the time I reach 55.

How do you feel about this change?

Will it affect your plans for financial independence or early retirement, and how will you mitigate the change?

References

1. Glen, J. (03/09/2020). Pensions – Question for Treasury. Retrieved from https://questions-statements.parliament.uk/written-questions/detail/2020-08-28/81494 on 13/09/2020.