The Year of Investing - July 2017

One month down on the year of investing! I'm pleased to say I'm ever so slightly ahead of my investing goal, but it was an uphill slog with the markets fighting against me!
I haven't quite hit my savings goal, but I think we're off to a good start for the year.

To reach Financial Independence, Retire Early, and not have to go to work on a Monday ever again I need lots of money. More importantly I need money that produces more money. Right now I spend between $25,000 and $30,000 a year. This doesn't include the maintenance costs on my investment property, because that 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.

Acorns

Want to try out Acorns? Check out my review first.

Opening Balance: $813.53
Deposited: $351.36
Dividends: $7.30
Market Gains: -$0.37
Current Balance: $1,171.82

Investing in a falling market isn't fun! Sure I only lost 37 cents, which was more than covered by the dividends in, but part of investing in shares is that they are supposed to go up in value, not down.

I threw in an extra $50 on top of my usual $75 a week to get above this months target of $1,153. That $50 came from having my absolute favourite house guest, a little Chihuahua called Chino. I charge $17 a night to pet sit, which doesn't happen very often because I'm super picky about my guests since I had a greyhound eat my doorframe!

Goal: $5,000
Amount remaining: $3,828.18 ($348.01 per month)
Current investment plan: $75 per week

Vanguard

Want to try out Vanguard? Check out my review first.

Opening Balance: $39,566.66
Deposited: $2,200
Dividends: $0
Market Gains: -$509.63
Current Balance: $41,257.03

Ahaha, what did I say about investing in a falling market. I threw $2,200 into this account, and yet it's only gone up $1,700. This is crazy. I understand that this early in my investing journey falling prices are a good thing, because I'm buying on special, but it's depressing to watch. Hopefully by Dollar Value Averaging I'll be getting the best deal I can.

Goal: $60,000
Amount remaining: $18,742.97 ($1,703.90 per month)
Current investment plan: $1200 per month, plus whatever extra I can find

RateSetter

Want to try out RateSetter? Check out my review first.

Opening Balance: $11,416.13
Deposited: $200
Loan Returns:  $101.02
Current Balance: $11,717.15

Ahhh, this one I like. RateSetter doesn't swing wildly with the share market. As economic markets change then the loan returns will change, but unless someone defaults on a loan my account balance won't be going backwards.

Goal: $15,000
Amount remaining: $3282.85 ($298.44 per month)
Current investment plan: $200 per month

Right on target :) One month down, eleven to go!

The big picture - my savings rate

In total I'm hoping to invest $28,000 during the Year of Investing. On top of that I plan to keep up with my mortgage repayments, which should see my debts drop by approximately $11,000. This means saving $39,000, just shy of 50% of my income. 

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 ;)

Here's how my savings look for July:

So, this looks weird right? I invested a tonne of money, but my savings aren't great? Let me explain...

I record my mortgage savings once a month, after the interest payments come out. In June I realised I had plenty of money spare, so I pulled it out of my mortgages and threw it into my investments. Then in June I recorded those extra investments as savings, and I didn't record the change in my mortgages until July.

So in short, my mortgage repayments went backwards this month. It's just a quirk of my recording system that is showing a small savings this month. It will all come out in the wash, I promise. Next month is looking to be light on bills, so I'm excited to report an even better savings rate next month.

Expenses

For the sake of curiosity, here's what I spent in July.

Category	Spent	Budgeted	Annual Average
Home	$1,082	$1,250	$1,343 (up $3)
A nice quite month, no bills!
Investment Property	$1,664	$1,250	$1,624 (up $66)
Really looking forward to this coming down, there shouldn't be any bills next month.
Personal Bills	$146.91	$147.08	$128.57 (up $5.41)
The usual
Groceries	$236.77	$200.00	$197.82 (down $0.38)
I was almost under for the month, then I saw a half price special on chicken breasts and milk so I stocked up! By the way, did you read the Epic Food Week posts?
Pets	$15.28	$30.00	$23.85 (down $1.39)
Still working my way through the stockpile of kitty litter and chicken food. Definitely buying more pellets next month though.
Roller Derby	$167.21	$111.25	$139.09 (up $13.69)
I bought tickets to our birthday party, but most of this spending is just drinks and nibbles at the after parties. Oops. The Grand Final is this weekend, so I'm expecting these costs to drop over the off season. Except that part where I might be going to Melbourne...
Travelling	$0	$100	$131.19 (no change)
No travel no spend. The total isn't dropping because I didn't travel in July last year either.
Other	$0	$245	$287.56 (up $104.62)
In July last year I had an insurance refund, so my Other 'spend' was negative. Hence why I spent nothing this month, but the average went up. Also - I spent NOTHING how great is that! It wasn't even planned, it just happened - go me!!
Total	$3,313.11	$3,333.33	$3,913.31 (up $191.81)
As I said In July last year I had an insurance refund, so spending for the month was about $900. Even though this was a low month, it's a lot higher than the $900 from 2016, so the average has spiked to reflect that. Darn :(