is covered by the rent. So if I wanted to walk out of work and never come back again, I need to find a way to make $25,000 a year, without a regular paycheck.
I'd rather go for the higher end of the scale though, so to fund my $30,000 lifestyle in retirement, I'm going to need to find $750,000 in the next eight and a half years, in accordance with the four percent rule.
The investment plan
For the next twelve months (July 2017 - June 2018) I am going to focus on supercharging my investments. The earlier in my retirement journey I start investing the more heavy lifting will be done by compound interest. By spending my money on buying more money in the early years, I hope to see my investments growing on their own through the next few years.In the Year of Investing I plan on building up my existing accounts until I have just over 10% of my retirement fund. Starting from $52,000 I'm aiming for $80,000 by July 1 2018, an increase of $28,000 - just shy of $2,400 a month.
Except, not really, because I have a stretch goal, and now a double stretch! Overall I plan to have $90k invested, for an increase of $38,000, or just over $3,150 a month.
Acorns Raiz
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June
Opening Balance: $4,760.44Deposited: $211.21
Dividends: $0.24
Market Gains: $30.63
Current Balance: $5,002.52
Since starting The Year of Investing
Opening Balance: $813.53Deposited: $3,891.01
Dividends: $73.27
Market Gains: $224.71
Final Balance: $5,002.52
Done, and ahead of target! Woo
Goal: $5,000 Done!
Future investment plan: At this point it's not really 'micro-investing' as the sales pitch goes. I'll keep adding a little money in each week, and letting it grow but I'll also be considering whether I should close the account and move somewhere with lower fees.
Vanguard
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June
Opening Balance: $66,720.37Deposited: $2,850
Dividends: $2,336.95
Market Gains: -$635.33
Current Balance: $71,271.99
Since starting The Year of Investing
Opening Balance: $39,566.66Deposited: $27,225
Dividends: $3,584.56
Market Gains: $845.77
Final Balance: $71,271.99
Umm, wow. The markets played along wonderfully!! Until dividends were paid, because that's a weird thing that happens. Leading up to dividends the prices spike, and after divs are paid they immediately plummet. I had $71,500 on the 28th of June, and a couple of days later dividends were paid and despite getting paid over $2,000 in dividends, the overall value actually dropped almost $300.
It's weird, but normal. Still kicked the goal, so still pretty chuffed.
Goal: $60,000 Done!It's weird, but normal. Still kicked the goal, so still pretty chuffed.
Stretch Goal: $65,000 Done!
Double Stretch Goal: $70,000 Done!
Future investment plan: $1,900 per month. This is split between 4 deposits into Australian Shares, Australian High Yield, International Shares, and a small amount of Australian Bonds. I'll be sticking to this moving forward, while I work on other goals.
RateSetter
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June
Opening Balance: $14,855.60Deposited: $200
Loan Returns: $104.57
Current Balance: $15,160.17
Since starting The Year of Investing
Opening Balance: $11,416.13Deposited: $2,550
Loan Returns: $1,194.04
Final Balance: $15,160.17
As I've been banging on about for the last year, RateSetter is wonderful. Nothing more to say, it's unexciting, reliable and a huge favourite of mine.
Goal: $15,000 Done!Futue investment plan: $200 per month. In my retirement plans, RateSetter will form a stable backbone of my investments that I can draw on in the event of a share market crash. I don't want to put all my eggs in this basket, and I know that it will be affected by economic swings, but it should move to a different beat than the markets.
The big picture - my savings rate
In total I'm hoping to invest $23,000 during the Year of Investing (now $33,000 with my double stretch goal!). On top of that I plan to keep up with my mortgage repayments, which should see my debts drop by approximately $12,500. This means saving $35,500, (45,500) just shy of 50% of my income (just over 57%).
So on top of paying down my mortgage and investing, I plan to squirrel away a little bit more so I can declare that I saved 50% of my income. In the previous 12 months I saved 41% of my income, so this year I though 'What the heck, let's push for 50%'.
According to the networthify early retirement calculator, if I pull this off I'll be able to retire in 9 years - just a few short months after my goal. A lot can happen in nine years, and I intend to prove that calculator wrong ;)
According to the Mad Fientist Lab, after June I'm eight years and three months away. In one month, I'm one month closer - tracking along. However to retire by 35 I need to bring that number down to six years and eight months, an ambitious goal.
Here's how my savings look for June:
I spent very little, but I paid the credit card bills from last months big spends.
I think my favourite part of this chart is that it shows the importance of front loading, and doing better than necessary when you can. At the start of the year I had three amazing months (August, October and November) and then a bad month, and two more good ones. This set me up nicely so that even though I was well below target for March, April and June, I still got over the line.
Expenses
For the sake of curiosity, here's what I spent in June.
| Category | Spent | Budgeted | 12 Month Average |
|---|---|---|---|
| Home | $1256.84 | $1,312.50 | $1,375.91 (down $1.16) |
| I threw a little more money at the power bill to cover my credit card minimum spend, and I started putting money aside for some desperately needed home improvements. | |||
| Investment Property | $773.55 | $1,166.67 | $1,293.86 (down $70.11) |
| Just the mortgage, my favourite kind of month. | |||
| Personal Bills | $151.60 | $151.60 | $148.08 (up $0.39) |
| New year, new health insurance premiums. Blergh. | |||
| Groceries | $215.22 | $200.00 | $199.60 (up $1.11) |
| I ate everything in the freezer and now it's empty again. I'm a little baffled as to why this month was so expensive, because we ate a lot of leftovers. | |||
| Pets | $103.10 | $29.00 | $39.97 (up $7.27) |
| BUY ALL THE THINGS AGAIN!! The miniature homesteads' two new chickens, and four quail are settling in nicely, except that three of the four quail are boys - so much for my egg-mpire. I've started putting aside money to build a pen that will hold 20 quail so I can get the boys a harem. In for a penny in for a pound! I hope to bring in $50+ a month in egg and bird sales once everything is set up, which is good because I spent nearly $100 on feed this month! More information to come about that... | |||
| Roller Derby | $300.92 | $150.00 | $217.33 (up $5.62) |
| GUESS WHO WENT TO DARWIN? THIS GUY! And bought new wheels and bearings for my skates. Ouch. I also need to start thinking about new skate boots since I ripped one of the eyelets out and have a hole in one toe. | |||
| Travelling | $0 | $100.00 | $0.00 (no change) |
| As usual, nothing, because I keep travelling for derby. | |||
| Other | $163.80 | $157.25 | $232.82 (up $3.57) |
| After last months big spend I wanted to keep this down. I bought a shirt, some booze and a couple of meals while I was away from home. | |||
| Total | $2965.03 | $3,267.02 | $3,507.56 (down $53.33) |
| Cheap Cheap, Cheap Cheap. Given that I need to bring my FIRE date 2 years closer than current projections, this is the sort of expense report I want to see. | |||
It's over, we did it!
The Year of Investing is officially over and I almost kicked all my goals. I smashed the investing goals, including my double stretch goal, and I saved 53% of my income. Keep your eyes peeled for my next round of goals - Adult Habits and Hoarding! It'll be thrilling stuff, I promise.
Blast from the Past!
The Year of Investing started July 2017. You can see past reports here:
Nice work 😃
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