December 2023 Savings, plus round up

Happy New Year!

I was in the gym on New Year’s Eve and out litter-picking on New Year’s Day morning – starting as I mean to go on!

Anyway, let’s just get the numbers out of the way for 2023!

I saved 12.1% of my net salary – not great, but a big credit card bill to cover gifts and social outings meant that I didn’t save as much as I would have liked.

The above includes £67.92 from doing Prolific surveys. I also received £103.83 from TopCashback* but ended up spending that on socialising.

Shares and Investment Trusts

No new investments, I just topped up existing ones.

Current share/IT portfolio can be found here.

(Entire portfolio here)

Future Fund 

Well, a mediocre year for investing ended up somewhat better than expected!

The Santa Rally did its thing and resulted in me achieving my £250k milestone for the first time since August 2021! Woohoo! 🙂

As at 31st December 2023, my Future Fund stood at £250,605.80.  After the painful sideways crawl of my investments over the past year or so, I am very happy and somewhat relieved that I’ve hit the milestone again.

Here’s how it all looks at the end of another year:

However, I had believed (hoped) that after raiding my Future Fund for my house deposit in 2021 (the big dip in Oct 21), the pot would have recouped/grown quicker but sadly, it was not to be.

Using unitization, I’m up just 5.8% this year across all my investments. This figure includes my dividend income portfolio, where stock prices continue to remain fairly depressed.

Nothing as spectacular as the growth that some other investors have reported, but after the nightmare of 2022, it was most comforting that things finally appear to be heading in the right direction.

Still, I daren’t be too hopeful for 2024 – it just feels like everything (at home and abroad) is teetering precariously on a knife edge and things liable to tip one way or another, causing tremors and disruption (or boom, if we’re lucky) in the stock markets.

Dividends and Other Income

A decent final month for dividends:

I received £535.97, of which £282.52 was from my ISAs, the rest from my SIPPs.

Here’s what the graph looks like after another year:

That’s TEN years of monthly dividends tracked so this is probably the last time you’ll see this version of this graph. Not sure I need to track by month like this, so I’ll probably simplify things.

Goals Update

And here’s how it all ended:

Three achieved! I’m counting the Dividend Income one as a win as I was just a tenner short, which is close enough!

Failing the Emergency Funds one didn’t surprise me – I was always going to struggle with this one, trying to balance saving/investing, coping with increased costs etc. I do need to keep at it though.

Wasn’t sure I would hit the charity donations one but I had been determined not to fail  this year. On this financial journey, I can’t just think about me and this is a way I can perhaps help others.

I read a total of 25 books (my Goodreads goal) and whilst not hitting the goal I set, am quite pleased that I managed to read three non-fiction books.

Am well chuffed with the dividend income, particularly what comes in my ISAs – this is now edging closer to my (current) goal of average £400 per month in income from my ISA investments to cover most of my basic household expenses. (£400 will more or less cover my council tax, broadband, gas and electricity and my monthly grocery food bill!).

What’s another Year?

2023 wasn’t a particularly good year but it could have been worse.

Year two in my house (I know!) and some plants I bought when I moved in are still alive – that’s a big win for me!

My uni friend’s serious illness has rekindled friendships and brought the old crowd closer again. She appears to be improving and is getting some of her life back again.

I’ve remained in employment and although work in the latter part of the year has gotten really hectic, I got a decent pay rise and I still like my colleagues. My new boss turned up at the right time to provide some much needed support I’ve not had in a while.

Am aware that I do need to put my health first – I’ve been mostly fit and well this year, but work has caused some mental fatigue, so it’s with absolute certainty that after my surgery later this month, I will be taking the time off to recover properly.

I wouldn’t say my social life was particularly busy this year but I still enjoyed outings with friends, attended most of the Manchester FIRE meet ups, attended WI meetings (and a couple of WI events), had a trip to see the tennis at Wimbledon and enjoyed a lovely trip to Hong Kong to see my family.

New Year, New Challenges?

2024 will likely be another challenging year – aren’t they all?

Despite the frothy stock markets right now, everything else still seems to be either wallowing in doom and gloom or about to tip over into the Pit of Doom. I need to step back from the news again I think!

Being a mostly optimistic person, I will just try to continue to ignore what I can’t control and just keep on keeping on, carry on saving and investing where I can and enjoy my life however I can.

My goals will likely end up being similar to previous ones (so not very exciting) but they keep me focused and they’re ones I can keep at.

Anyway, here’s to a happy, healthy and hopefully wealthy 2024 to all of us!

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21 thoughts on “December 2023 Savings, plus round up

  1. Longtime lurker but congratulations on 2023!
    Really enjoyed reading your updates over this year, and impressed with 25 books read in a year.

    Intrigued to know what was your average net saving per month?

    • Hi Ray
      Thanks for the comment and thanks very much for reading!
      My average net saving per month was around 16.7%, which wasn’t great – ideally, I’d love to save a minimum of 25% but increased costs has meant that I can’t stretch that far. If I can maintain this again this year, I’ll be fairly satisfied.

  2. I am not sure I have commented before, but I enjoy your blog – a great mix of FIRE and personal blog 🙂 It’s always nice to read you.
    I am considering starting a similar blog as well, but things are a bit too hectic right now. Yours will def be an inspiration when that happens.
    Happy New Year!

    • Hi Audrey
      Happy New Year and thanks for reading!
      Good luck with starting your blog – if you’d like some insights about my blogging experience, drop me a PM.

  3. Here’s what I’ll be mulling over in 2024: inheritance tax (IT).

    If you have a paid-off house worth over £325,000, then everything else you accumulate beyond that will be subject to IT – at the hefty rate of 40%.

    Let’s say your stash size is 300k (and you have the aforementioned paid off house worth 325k), then you’ll be paying 120k IT on your stash.

    I’m pondering whether I’m better off quitting work and spending that money now, rather than giving it to the government.

    What do you think?

    p.s. Of course, my example included the house, but even if you don’t have a house the 325k threshold applies. The thing to remember is the government will get a good chunk above the threshold either way…

    • Hi Codefreeze

      I’m not concerned about IHT but my sister is, so much so that she’s been shifting money from her ISA to her SIPP (SIPPs not being subject to IHT) and making the most of the £60k allowance, plus allowance not used in previous years. Is this something you have considered with your planning?

      There’s rumours the Tories are going to do away with IHT but as with their getting rid of the lifetime allowance, it only means Labour will/could bring it back.

      • > shifting money from her ISA to her SIPP

        Although if she dies after 75, her offspring will be charged income tax on any withdrawals, won’t they? If they are higher rate tax payers we’re talking 40%+ again…

        > Is this something you have considered with your planning?

        Sort of. Outside of my paid off house, the bulk of my net worth is in my SIPP. Originally I was going to just “sit on the stash” (which I already paid income tax on, at 40%), take the income generated (taxed as income!), and let the government take its 40% (flipping hell!).

        But now I’m considering running down the stash (basically spending the bulk before the government gets it). I’m still quite a few years away from taking a state pension, so if I stop work now, I’d be able to take the SIPP at the 20% rate, assuming I draw down less than 50k (or whatever it is now), or zero rate if I take less than the personal allowance.

        Of course you have to be careful on this as life is unpredictable. But I am considering increasing expenditure considerably, while leaving an emergency fund…not sure yet, but YOLO is kicking in… 😉 Post state retirement age I’d live on a state pension, and a small teacher’s pension, dipping into my greatly reduced stash as required e.g. healthcare, new car, whatever… 🙂

        I really don’t have the answer to this though, so I’m interested to know what others are considering, especially in the UK.

        > There’s rumours the Tories are going to do away with IHT

        LOL, I’ve heard that before – usually in the run up to elections, still waiting… 😀

        If Labour do get in they are contemplating a wealth tax (actually counter productive to wealth, ironically), and I suspect they’d be more inclined to tax ISAs over 100k than the Tories…but all speculation…

        This is all kind of nuts considering both parties want people to stay in work longer. The incentives aren’t really in place for this though in my opinion.

        p.s. this seems to be a shortcoming in the FIRE approach that I’ve not seen discussed before. The idea that at EOL you are left with a stash that the government is most likely going to take 40% of…oh well…

        • Hi Codefreeze

          Yes, can’t really get away from income tax upon withdrawal but it’s IHT she wants to try to avoid.

          I’m not following the ‘Die with Zero’ philosophy, but do plan on spending my wealth. Taking my parents’ own retirement as an example, they spent a lot during the early years of retirement, a lot less these days as they live far more simple lives and travel less often. I see something similar and while not YOLO, will probably spend more in the first 10 years of retirement, than the last 10.

          I think it took me a while to figure out that regardless of colour of party, politicians make changes to get votes/win elections, not what is best for the long term. Agree that both parties want people to stay in work longer (to prop up the state pension) but whatever they bring in, there will always be people who will be unhappy.

  4. Happy New Year Weenie!

    Thanks for sharing your journey and the regular updates, there is always something to think about and delve deeper into.

    Matched betting never worked for me, possibly because it wasn’t something I enjoyed, but Prolific surveys have been a winner so thank you for that one!

    We gave up watching the news a couple of years ago, it was getting depressing, and eventually we got to the point where we were only watching Prime movies, so we ditched Sky and the TV Licence earlier this year – quite a saving.

    I’m at a different period in my life, the part where you try to spend it wisely and have the best life you can in your remaining years, so I’m not aiming for growth, just trying to make money work as hard for me as possible before I spend it on grandkids, holidays, motorbikes & hobbies etc. You can’t take it with you and once you have looked after family members you want to avoid the Government getting their paws on it through IHT, as another poster has already brought up.

    In my opinion you are right to put your health at the top of your priorities and also to enjoy life while you are both young enough and fit enough to do so, its a fine line between saving for the future and enjoying the day you have infront of you, because tomorrow is never guaranteed.

    Keep the updates coming!

    • Happy New Year, Ken!

      This year will probably be my last for Matched Betting, I just don’t have the time any more. But like you, Prolific surveys is a winner – great to hear that it’s working for you! Did you also sign up to Research in Finance? Don’t get many surveys with them but they pay well (in Amazon vouchers) and if you get on the occasional workgroup, you can earn between £100-£250 for several days ‘work’ on surveys/reviews.

      Definitely cutting back on my news! My only current subscriptions are Amazon Prime and the TV licence – annoying as the latter is, I do watch live TV (mostly sport) and regularly watch iPlayer. I’m not planning on renewing Now TV or Netflix (I used to have one or the other).

      Agree, tomorrow is never guaranteed, didn’t someone (Benjamin Franklin) say that nothing was certain except death and taxes? The former will get us all in the end, but we can try to avoid the latter as much as we can, haha!

  5. HNY Weenie. Good to see the rocket powering up again along with a few milestones notched up along the way, particularly those pesky household bills that you’ve hopefully nailed now and accounted for forever. The Monevator boys were talking about the ‘floor and upside’ approach recently, and it’s so reassuring to know that barring an absolute catastrophe, the essentials are effectively covered.

    My total return for the year came in at around only 5.4%, but i’m only about 50% equities now and have a few bonds that have interest payments due in the coming months that i’ve not accounted for, so the 5.4% figure is a bit conservative. Even so, i think my relatively poor performance is reminding me (yet again!) that my active investing can’t compete with the low cost index’s out there, and my task for the forseeable future surely has to be to switch most of my holdings over to more sensible index investments. I’d already done that with some of my SIPP and bought the S&P 500 – if only i’d done that ten years ago as opposed to just ten weeks back! I’m sure i’ll still cling on to a few of the old favourites, but as i’m no longer earning a salary it’s probably best now to ease off on most of the punting investments and revisit a few firm ‘investment rules’ that i should be following in decumulation.

    Don’t panic about your emergency fund – you just need to remind yourself that you can always liquidate your premium bonds pretty quickly, if needs must. I often find myself puzzling over the bucket strategy apportionments that i vaguely follow, and questioning myself as to why i’ve assigned a certain holding to one bucket rather than another! And when you come to access your pensions and move into drawdown etc., there can be some big pots jumping around, so everything changes. My recommendation here is to start planning your specific drawdown approach 5 years in advance, and refine it every time the Chancellor throws another curveball. At least you should have a plan of sorts that you can hit the ground running with when you eventually FIRE. I’m nine months into retirement and i’m still formulating exactly what i’m going to do. Never underestimate the amount of Government tinkering!

    All the best for the next few weeks, and make sure you’ve got a few good books in to help you relax and recuperate.

    • Hey KC

      The ‘floor and upside’ approach as mentioned by Monevator was indeed what I had in mind when I decided to allocate part of my portfolio to income paying investments. Just some bills that I will no longer have to worry about!

      5.4% is a great gain considering only 50% equities. Over the next couple of years, I want to reduce the number of investments I have, both on the dividend income side and on the growth side, just to make things more manageable.

      Hear what you are saying about the emergency fund – of course you are right that I could just liquidate premium bonds if absolutely necessary but my mind clearly wants to have ‘buckets’ for different things, so it’s probably more for comfort than anything else. Understand that when it comes to drawdown, all those buckets become one big pot, although I’m sure I’ll still have spreadsheets to juggle them!

      Over the festive period, I did start looking at what drawdown would look like but it seemed like too much work but I’ve started so it’s something I will pick up on again – will need to plot different scenarios to cover potential curveballs!

      Thanks for your continued support, hope you are enjoying your retirement, can’t wait to be in the same position!

  6. Happy New Year, Weenie! I always enjoy reading your blogs. Good to see the rocket again. Why can’t the 2020s be more like the 1920s? 😉

  7. Thanks for your update weenie. I am sorry that it’s been a bit of a turbulent year for you and I really hope this new year turns out to be a good one for you. You keep savings and investing where you can but most importantly enjoy life as much as you can along the way. Wish you all the best for the new year!

    And… it’s superb to see your future fund back at £250,000, that’s great! Mine shot up to £265,000 which I really did not expect as all.

    TFJ

  8. Happy New Year, Weenie

    Your graph: definitely seems to be on the upwards and onwards, eh? 🙂

    One thing I’ve never grasped about your emergency fund is why you don’t prioritise getting that to where you think it ought to be. Conventionally, the advice is to get your emergency funds established first. But I guess with your future fund being quite sizeable that you feel safe just slowly building up the emergency stash?

    Re floor-and-upside approach. Again, you seem to be taking a different tack. Per Monevator, isn’t the floor supposed to be “generated using near risk-free assets“. Anyhow, you have that already with your DB pensions when they come into payment. At which point, will the IT income stream be redundant (and just become more “fun” money)? My guess is that you are using the IT income to avoid selling shares, to bridge the gap until the DBs are paying? All part of your aforementioned drawdown planning no doubt.

    All the best for your op later this month. Try not to worry.

    • Happy New Year, Curlew!

      Yes, the conventional FIRE advice is to get the emergency fund sorted before investing but for a long time, I didn’t have much of one as I used 0% credit cards to handle emergencies, ie pay off emergency with card, settle card before interest kicks in. This allowed me to start my investing journey as soon as I realised it was what I needed to do.

      Over the years, I started building an emergency fund but as it got used (for emergencies), I’ve been balancing replenishing it with continuing to invest. However as you have stated, I do feel comfortable with just slowly building up the stash.

      You’re right my DB pension (along with the state pension) will provide me with the minimum ‘floor’. I don’t intend to but if I were to burn through my entire Future Fund (excluding the IT portfolio), the DB pension, state pension and my IT income would still allow me to live a close to ‘moderate’ life, according to Retirement Living Standards. If I were to have to sell the IT portfolio for some reason, I think I would still be ok, although I would be living closer to the ‘minimum’ life.

      My Future Fund’s purpose is really to enable me to retire earlier, it’s the bridge between early retirement and getting my hands on my DB pension/state pension and yes, the IT portfolio is so that I don’t have to derive all my income from selling investments, although I will still have to sell some (not looking forward to that!).

      I’ve yet to fully put this into some sort of detailed model/spreadsheet so it could be there’s a flaw in my calculations so I do really need to plan my drawdown!

      Thanks for your kind comments and continued support, it’s much appreciated.

  9. Weenie,
    Thanks for the comprehensive response. A lot I could say but for brevity I’ll stick to one topic: the “detailed model/spreadsheet”. Do this.

    I can’t stress too highly about the usefulness of creating a financial model. You don’t need me to tell you that no plan can ever properly map out how you will actually spend your money: far too many variables – it’s hard enough with the things that are genuinely within your control :-). But I found that creating a spreadsheet showing projected income, offset by likely expenditure was revealing.

    In particular, I found that taking the actuarial hit on my DB pensions was worth it. Perhaps similar to your situation, it’s a balance between how much the DB pension pays out vs how much I would need to take from the future fund to provide a top-up to my desired income. To my surprise, I found that even taking the DB quite early things looked fine. Crucially, the reduced DB income didn’t result in a lower net worth until I was about 94. That was the key thing.

    There’s a bit more to it than I’ve described (e.g. slipping state pension age back a few years made a surprisingly small difference in the grand scheme of things) and, yes, I have refined and debugged (nothing major) it over the years.

    I’m sure you’ll enjoy creating it! 🙂

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