2019-2020 My year in review

General finance chat
#1

So, I tend not to complete my review Jan - Dec, but prefer to tie things up Dec-Nov, so I can plan for the coming year. December can be a bit of a limbo month between the two.

Providing I have marked everything up correctly, then my budget worked out as follows:

Savings/Investments: 34%
Bills: 28%
Food and Drink: 12%
Groceries: 7%
Experiences: 6%
Gifts/Household/Holidays: 10%
Other: 3%

All in all, not a bad year. It would be handy if MD could split my Savings/Investments/Expenses proportionally against my income so I did not have to adjust the figures to work that out, but it is showing me some interesting trends and it is a free tool after all.

This year has been a little different, and because I feel that I have been lucky and relatively unaffected due to my ability to work from home. I have however ordered a lot more food than I would normally expect from local cafe’s, bars and restaurants with the view that I am helping them keep going as walking past you can see they are mostly empty shells of what they used to be. This is clearly visible in the numbers by the fact I spend 12% on food and drink, yet only 7% on groceries.

I also think I have been slightly wasteful of food, so I have started my own food planner as well. I have not included pension contributions in these figures, as I changed jobs during the pandemic, and they take my contributions out of my salary before I get paid. I also left before my annual bonus period was up, so lost out on some income there, but cash wasn’t my driver for changing jobs - career progression was.

I think I need to revisit some of my spending. I read a lot of articles on FIRE, and budgets - the 50/30/20 rule I rather like. 50% on needs, 30% on wants, and 20% on savings. My bills and groceries probably fall under needs, so that’s 35%, Wants are 31% and savings 34%. In that sense I have mostly tipped what I have not spent as needs to savings, but I think my wants are too high. I need to drill down on the numbers more to work out where I need to look at.

I’ll add to my post once I’ve done some more analysis - probably on how to cut down on take aways(Food and Drink), and the meals I will replace them with going forward.

How has everyone else found this year?

2 Likes
#2

Superb analysis @richarddougal ! :raised_hands:

#3

hi @richarddougal, I get all your figures except the first one…
Savings and Investments 34%.

Are you saying you have made 34% profit on S& I e.g. if you started with 10,000 on Dec 1st you now have realised £13,400?

OR

Are you saying that over 12 months you have increased your S&I input by 34% so for example whereas last year you saved £10,000 … this year you have managed to increase that to salt away £13,400 over a 12 month period?

If the former. please feel free to DM me your Investment Strategy! (funnyface emoji)

#4

Hi @kinggooner

I’m also a Gunners fan, if that’s why you chose your username. About time our fortunes turned around LOL.

Neither is the answer. It is simply a breakdown of how I have allocated my take home pay - so I managed to save 34% of my income from my salary, and deposit into cash or stocks and shares. It would be higher if I count my pension contributions that come out before I get paid.

I’ve made a decent amount this year with my choice of funds. My biggest mistake looking back over the year, was in the week before the ‘lockdown’, thinking that something was about to happen that would shock the markets, and that I should temporarily convert my pension to 100% cash with a view to reinvest a few weeks later. The reason I didn’t, is that my pension is one thing I generally do not touch. My pension would be about 40-50% higher if I did.

Shares I have invested over the year during the dip were Ceres Power, Disney, Greenland Gold, Hurricane Energy, JD Wetherspoons, MTI Wireless, Natwest, Pinterest and Royal Dutch Shell. Only one is currently in a loss this year. That is Hurricane Energy, and I generally do not sell shares at a loss as a rule, so I am waiting to see if it recovers close to my entry price at about 8p.

Most of my own personal investments are placed in a global equity tracker, or smaller satellite funds. Things like the Baillie Gifford UK Equity Alpha / Long Term Global Growth funds, Scottish Mortgage Investment Trust, Vanguard Lifestrategy 100% / FTSE All World Equity Index ETF, Xtrackers MSCI Information Technology ETF.

There’s an article out there that I believe says over 70% of individual investors cannot beat an index fund in general over the long term, and similar for approximately 52% of actively manage funds out there. So in that regard, I air in the side of caution, and limit my own personal investment choices.

The two keys I find to investing is diversity and time. You have to be willing to stand by your investments, and leave them for a period of time to have ample opportunity to grow.

At the moment, I am currently working on my food planner. Its something key that would help reduce the fact that I have spent more eating out(*take aways) this year, than eating in.

Its quite difficult working out meals that you can collect appropriate quantities of ingredients from shops, to minimise waste.

In this regard, I’ve not got much further than a set of long life breakfast options. This would be things like:

  • Overnight Oats with Chocolate and Banana
  • Overnight Oats with mixed berries

The base being 60g vanilla protein powder and 250ml almond milk with a tablespoon of chocolate and a banana chucked in the blender. Once mixed, add 75g of oats, and leave in the fridge overnight.

For mixed berries, leave out the chocolate, and you can either add 100g of frozen mixed fruits and let it soak overnight, or mix them in in the morning.

Both work out at about £1.3 a portion, and most of the ingredients are long life except the bananas.

For lunch, I am collecting recipe’s right now, but one of my favourites is this vegan curried pumpkin lentil soup. I can make it for about £0.6 a portion, and it keeps well in the fridge a few days.

Not all meals will be as cheap as £0.6, but I think I can probably average a reasonable £1-£1.50 a meal by myself.

By planning meals better, I am hoping to cut down the amount of take away meals I order from 1 or 2 a week, to 1 or 2 a month. If I can do that, then I think I should be able to save an extra 6-8% of my salary without any real noticeable change (apart from my increased savings which is a bonus).

#5

Indeed @richarddougal I have never fancied our chances less in a NLD. Like investing Arsenal are currently in a long term fix situation.
Thanks for the info. I think we are in a different league re investing, as much as anything because I have finished work and am now trying to make what I have work for me. I have a good works pension so I don’t need income from the investments perse, especially now I also receive that little (laughable) bit from the government lovingly called the State Pension. It is more something to keep the old brain from atrophying.
I invest in a similar manner, in that I let funds do most of the work with the big amounts, but I do have about £10k, that I play about with over a year selecting my own shares, just to play about. I reckon my funds are doing OK just being left alone, but my share choices are up BUT very average, which is why I, like you, let the big boys handle the big stuff. I am definitely diversified that is for sure, and to be honest if all the funds too a deep dive, it would be my kids missing out rather than me.
I took a bit of a bath before lockdown, but like you I never sell at a loss and I am probably just a little bit in a better place now, by leaving everything alone.
The only share that I can be proud of is that I got in very early with TESLA but apart from that, no-one would use me to pick shares for them!
Good luck in your eating ventures going forward.
Teams should be announced any minute.

#6

So looking at my finances further, I’ve decided to make a few changes to 2021.

  1. My monthly JL repayments for my MacBook end in January(£65). This extra money no longer spent is going to be put aside, potentially looking between MERI Merian Chrysalis Investment Trust, and SMT Scottish Mortgage Trust.
  1. Cut down on takeaways. I think I’m close to averaging 2-3 a week, and that is far too much. One every 2 weeks should be my limit, or special occasions. I have a good sized kitchen, and I work from home so I should make the most of it. Breakfast would be a mix of banana pancakes and overnight oats for starters. For lunch/dinner, this week I made an awesome vegetable lasagne that made enough for 6 meals, and today I went for pizza, lunch and dinner. I can also make a mean bulgogi, and also a butternut squash soup.

I hate to say it, but filtering my annual spending for the likes of Just-Eat, Deliveroo, Dominoes, Papa Johns, the numbers just make me cringe!

To help limit myself, I’m going to create another space in my Starling account - ‘treats’. I will transfer a small amount to this every week, and the rest that I have spent on takeaways this year, will go into the likes of VWRP - Vanguard FTSE All World Index ETF.

  1. Last but not least, I have an ‘online personal trainer’ to give me advice on my running. I’m tempted to cancel this, and for the coming months rotate the training plans over a 12 week cycle, adding in some items of my own. That would be £15 a week saved, so quite a lot over the course of a year, but its something I enjoyed at the start of lockdown to help keep me motivated.

The only other thing I need to think about, is my mortgage is up for renewal in 2021. I need to decide if/how long I should extend this for. I could make some overpayments, but I think playing about with calculators last time I changed my provider, that there is a sweet spot at about 40%. Once you get past that, you are unlikely to get access to better rates. With the term I have remaining(over 10 years), I think I will still be best investing any extra funds.

#7

Here’s a list of some of my favourite recipes:

Breakfast:

www.thekitchn.com/how-to-make-2-ingredient-banana-pancakes-cooking-lessons-from-the-kitchn-218658

Lunch/Dinner:

The above makes six portions, and was amazing! I might swap the tinned tomatoes for tubes of paste instead though.

More if a summer meal, but still brilliant none the less.

This is more this time of year, and Yum :drooling_face:

Snacks:

Last but not least, who doesn’t like a twix (or a take on millionaire shortbread really)