Savings
Despite being a busy month, August was a good one for me savings-wise:
Yes, that’s right – I saved 52% of my net income, my best rate so far! The savings were boosted by £1.02 from Ebay, £62.71 from TopCashback*, £60 from my Mum (for ‘housekeeping’ when she and Dad were over!) and £200 rent received.
Two SIPPs
As you can see, I now have two SIPPs. I wanted a platform to invest in ETFs and shares regularly and more cost effectively than my current platform, Hargreaves Lansdown, so I opened an account with AJ Bell Youinvest. Share dealing charges are £9.45 (if you make 10 or more deals in a month, this drops to £4.95) but you are also able to make monthly purchases of shares or payments into ETFs for £1.50, which is what I want to do.
This does mean that if I want to buy a particular share, I have to set it up as a regular purchase on my account and the shares only get purchased on a particular day of the month so I may ‘miss out’ on low share prices. However, it also means that I don’t have to wait until I’ve got a large sum to buy my shares to make it cost effective, eg my regular payments are £300, so the £1.50 works out at 0.5%, whereas £9.45 works out at 3% of £300.
Shares
So, what shares did I buy this month? No prizes for guessing that I have gone and bought Tesco shares (TSCO) just as the price plummeted and they announced a cut in their interim dividend! But hey ho, I’m still learning about investing and whilst it’s doom and gloom for Tesco at the moment, I still feel that they will bounce back in the long-term.
As for other shares in the future, I’m likely to just add a mix of the ‘usual suspects‘, ie shares that I hope will continue to pay good dividends.
Dividend investing isn’t likely to be a huge part of my portfolio but it will play a small part.
[*Referral link]
Wow, 52% is awesome! Especially after attending the infamously expensive music festivals of this country 😉
Great job!
Hi ERG, thanks! Yes, festivals here aren't cheap but most of the expenses were accounted for earlier in the year, ie buying the tickets, train fare etc. I had all my gear from previous festival outings so my only expenditure at the actual festival was for alcohol and food! 🙂
Wow 52 % that is impressive! I don't know much about Tesco but know my parents shop there when they are over there.
Hi May, thanks! I think I could probably save a bit more but I'm not quite ready to go down the full budget route yet – if ever, as I'm not sure I could stick to something so rigid!
Tesco is one of the big 4 supermarkets in the UK, they've just issued a profit warning, slashed their dividends and their share price has fallen by 8%…a new boss too so change afoot for the better I hope!
Thanks for stopping by!
Well done Weenie, what a fabulous savings rate of 52% – you put me to shame.
Thanks GFC, I hope to be able to maintain this rate so that I will get my minimum 50% average (a few months weren't so good!). Christmas shopping on the horizon will be a big obstacle, plus I have travel plans too like yourself, but I'm going to try my best! Thanks for stopping by!
Great saving rate Weenie, especially since you had such a busy month!
Thanks Laura – despite being so busy, there wasn't a lot of spending going on as that was done in previous months!
Great going weenie and here's hoping Sept goes just as well on the savings front.
I also pay £1.50 for regular investments (the first £20 each quarter is actually covered by the subscription charges at II) which means I don't feel so bad spreading my monthly £500 across several funds. I'll make sure I do what you've done in future though and keep a close eye on how trades work out from a % point of view. Thanks for reminding me 🙂
Thanks Cerridwen. That's a good deal with II – I did look at them when I was considering my second platform but according to Monevator's comparison list, II are more suitable for large portfolios, which is not what I currently have. Yes, I didn't really think of the % thing before until I saw that dividend investors often bought their shares in bulk as opposed to small amounts because of trading fees. Just another expense to watch out for and to reduce!
Well done on saving over half your net income Weenie! Did you use a financial adviser to help you in selecting where to invest or did you pick your investments yourself? I'm interested in investing but haven't a clue where to start!
Hi Hayley, thanks! I picked the investments myself. Monevator's excellent post: http://monevator.com/9-lazy-portfolios-for-uk-passive-investors-2010/ will give you some good ideas and Tim Hale's 'Smarter Investing' has helped point me in a better direction. Good luck!
Great job on the 52% savings rate? Do you have "total market" ETF index funds available? If you want TESCO, buy the Index ETF. It is in there at market weight. Trying to pick winners is very very hard over the long term. You might have to buy 2 or 3 ETF to build a perfect ETF index portfolio. A "domestic" total market, An "international" total market and a total bond fund index. Having "your age in bonds" helps dramatically take the big dips off your radar. Good luck!
Hi Wade, thanks! I have some investment in a UK all share tracker and Tesco will be in there, although I can't tell as I can only see the top 10. Trying to pick winners is difficult, but I'm going to try to pick a dozen or so that are consistently paying high dividends. I've yet to buy an an ETF but have a couple on my radar.
My 'age in bonds' would be too high for my liking haha so I'm willing to take the risk on equities with only a small amount in bonds.
Congratulations on the 52% Weenie! I think any percentage over 50% is something to be proud of, especially considering you had an expensive month.
Your have a nice spread of savings too.
Yes, let's stay positive about Tesco. I'm in it for the long haul, and I'm sure they'll turn it around in turn. Just like Lloyds, and BP……
Keep up the good work, you're doing a fantastic job!
Cheers
Huw
Hi Huw, thanks! I think I need to invest more of the 50% however, so will have a look at the cash at the end of the year I think. Yes, I remain positive about Tesco and may even look at buying into BP…
Cheers for the kind comments and encouragement!