Monday 3rd May 2021
I turned 37 in April. As I blew out my birthday candles, I released I had nothing to wish for - I had everything I needed and was content with my life.
Contentment is an important aspect of the FIRE movement, and one which is often not mentioned. Often when blogging and podcasting, it is easy to focus on the exciting things about trying to become financially independent... in truth, 90% of the FIRE movement is simply good old fashioned hard work - jump out of bed, work hard, save hard and invest well. Rinse and repeat for 8-15 years and you should be somewhere close (assuming you can get your savings rate to over 50%)!
Contentment is important as well, because one is going to need that as a minimum to actually become financially independent. Resisting the urge to upgrade a phone, car or bigger house takes discipline, especially when you see friends and peers with the latest gadgets.
Contentment also extends to other aspects of the FIRE movement. In April, we were able to add €4,500 into our investment portfolio. This was done via a €4,000 pension contribution and €500 added to our emergency fund, which lives in my web development company. While we continue to build wealth in our pension and company, our personal financial situation is challenging at best.
We deliberately pay ourselves at the lower tax rate to avoid paying 50% tax - something which we have identified as a key component of our ability to become financially independent. It should be noted that we do have some income that we pay 50% tax on - such as income from our rental property and from affiliate commission, however this income isn't tied directly to our time. As we see it, working one hour and giving half of that income to the Revenue Department is simply an unfair deal.
Having three children and recently moving house has put some financial pressure on us over the last few months. We have had to make renovations and repairs in the new house, which has made keeping our budget difficult at best. However, as a family we know that we need to continue pushing ourselves to add to our portfolio and that our personal finances - while in a mess at the moment - will correct themselves with some good old fashioned discipline.
The numbers tell the full story. In the first four months of the year, the portfolio has grown from ~€125,000 to ~€151,000 (up €26k in 4 months). Obviously this has been helped by the sharemarket hitting all time highs, but even without that, our ability to continue to add regularly to our portfolio is the reason for majority of the growth.
Let’s jump over to the numbers for April:
|Portfolio Summary (as at 30th April 2021)|
|Portfolio Capital Gain + Income||€2,704.95|
|Monthly Portfolio Growth Report|
|Capital Gain + Dividend Income from Equities||€2,103.51|
|Real Estate Income||€690.97|
|Peer to Peer Lending Income||€5.14|
|Cryptocurrency Capital Gain||-€94.67|
The table below shows the breakdown of my portfolio into the various asset classes:
|Portfolio Asset Breakdown (as at 30th April 2021)|
|Peer to Peer Lending||€1,148.28||0.76%|
Foolish investments are bad investments I made early on, where I find myself not in a position to cash the investments out. I have no evidence yet to suggest that I won't see a return from these investments, so for now, they remain as part of my portfolio, until such a time that I am able to cash out, or the investment gets written off. These investments are a mix of bad peer to peer lending loans and investments in private companies. These foolish investments are all unregulated investments.
|Good vs Foolish Investments (as at 30th April 2021)|
I thought I would highlight what percentage of my portfolio is within my pension (which I won't be able to access until I am 55). We do have a rental property and the plan would be to withdraw that monthly income once I cut down to part time work. At the moment, we simply invest that money back into the portfolio.
If I am able to get my pension balance to a little over €400k by the time I am 42 (5 years away), then assuming an average return of 7.1% over the next 13 years, the overall pension value would have grown to over €1 million by the time I need to withdraw from it.
|Pension VS Non Pension Investments (as at 30th April 2021)|
|Non Pension Investments||€97,794.90||56.35%|
I thought it would also good to show a quick year to date summary, so you can see how the numbers look at a bigger scale:
|Portfolio Summary (from 1st January - 30th April 2021)|
|Portfolio Capital Gain + Income||€7,014.16|
This one is a little tongue and cheek - but based on my FI calculator results, and given that I work ~230 days a year, I have approximately 1,265 full time work days left to FI, or 253 Monday's!
Finally, it isn't all just about money! I also work on projects because I want to make positive changes to the world! Here are some projects I am part of:
I launched The Irish FIRE Podcast in June 2019. While I did run ads back on the podcast when it first launched, these days I run the podcast as a passion project. The podcast shares my story on my journey towards financial independence.
An Dúlra Co-Op is an Irish initiative hoping to make a positive difference, by establishing Irish native woodlands. Irish residents can become shareholders of the co-op and become part owners of newly established Irish forests. I co-founded the co-op in September 2020. We are still looking for new investors, so definitely check it out!
Portfolio Tracker is designed for those who are pursuing financial independence and are looking for a software that will add accountability to your FI journey. Portfolio Tracker is a simple, flexible investment software that will allow you to see the growth of your portfolio over time, without being complicated to maintain. Click here to track your own portfolio.
I helped co-found four new hockey clubs in North Munster, introducing over 300 children to the game of hockey. Interested in your children playing hockey? Feel free to bring them along to any of the following hockey clubs - Castletroy Hockey Club, Ennis Hockey Club, Nenagh Hockey Club and Thurles Hockey Club.