Irish Financial Independence & Personal Finance Podcast

April 2022 Portfolio Update

Tuesday 3rd May 2022

The €10k a Month Challenge

April marked the fourth month in a row that I have been able to make a decent monthly contribution to my portfolio - in fact I have now added €40k to my portfolio in the first 4 months of the year - averaging €10k per month.

The contributions during April were slightly down on previous months as I finally finished one of the moonlighting projects I had been working on since November, but I am due to start another in May, so the contributions will rock up again.

There is no secret to my success. I have been able to increase my monthly contributions by simply working longer hours each day. I have a day contract with one of the big tech companies, and then moonlight where I can, working on freelance based projects in my free time.

It is a big sacrifice to make in terms of giving up a lot of free time, however, the numbers are starting to look better and better and this keeps me motivated.

Last month, I mentioned that I could look to adopt a Barista FIRE approach if I were to build a portfolio of around €750k. In truth, this feels like the best approach for me to take. I know in the long run an income of around €30k per month (in today’s money) is more than enough for myself and my wife to retire comfortably.

Assuming I were to hit a portfolio of €750k an starting withdrawing €30k per year (4%), I would still need to work a little, to cover the additional cost of raising our children and covering our mortgage payment, however at some point, our children won’t be dependent on our income and our mortgage will be paid. Rather than worry about trying to account for this additional cost, it is far easier to let it be - especially as I still plan to work to some degree in retirement anyway.

How much work is a little adopting a Barista FIRE approach? The €30k would cover roughly two thirds of our current lifestyle spending, meaning that I would need to earn around €15k per year in retirement. I could easily do this on a causal freelancing basis as a software developer, working 5-10 hours per week - with plenty of days off in between!

The real reason this approach excites me, is because when I start to forecast contributions of around €10k a month, and assuming a conservative return of 5%, then I am potentially only 3 and a half years away from hitting that magic €750k portfolio number. As much as I know that I can adopt Slow FI at any point - I figure I may as well look to keep trying to maintain €10k a month contributions, knowing that 3 years or so is a short time to hit a pretty awesome goal!

Sale Agreed on Second Investment Property

We went ‘sale agreed’ on our second investment property in April. We haven’t signed contracts yet, so there is still a chance the deal may fall through, but so far all is looking good. I plan to release a podcast episode in May specifically about my experience buying property in 2022.

With us buying another investment property, I put my dream of an electric car on the back burner for now - though I am pleased to say that I am getting used to driving a diesel car and am enjoying the significant fuel saving that comes from driving a diesel vehicle. We are saving around €30 per week from our previous petrol car.

April 2022 Portfolio Report

Another €7,750 was added to the portfolio in April - bringing the average contributions during the first four months of the year to €10k. With going ‘sale agreed’ in April, I will be mainly adding cash over the next month or so to complete the sale.

Equities were down in April, eliminating the gains in March and tanking further. Interestingly, I have three different pensions, with slightly different funds in each, and it is always surprising to see that there can be big differences in the performance of each, even though the funds they invest in are similar. For example my worst performing Pension was Davy, falling 7.54%, whereas Aviva only fell by 2.01% over the same period. Davy is a broker account, so the assets are likely updated in more real time - Irish Life and Aviva are their own funds, so there is likely a delay by a day or two. Given the S&P 500 dropped significantly on the last day of April, it likely hasn’t fully reflected the real fall yet. We may see this reflected in the report next month.

I don’t worry too much about a falling share market - this is all part of the investment cycle and it looks like 2022 is going to be a year of griding it out when it comes to investing in equities. For now, I will keep cost averaging in and sticking to the long term plan!

Next month I plan to share more details on my investment strategy over the next year or so, in particular on how I plan to build a portfolio that I can withdraw from in retirement. To date, I often talk in percentages, e.g. withdrawing 4%, however I wish to share how I plan to build a portfolio that will allow me provide the income I need in retirement.

Portfolio Summary (as at 30th April 2022)
Opening Balance €251,534.55
New Contributions €7,750.00
Portfolio Growth -€5,771.53
Closing Balance €253,513.02

Monthly Portfolio Growth Report

Monthly Portfolio Growth Report
Capital Gain + Dividend Income from Equities -€6,443.41
Real Estate Income €671.88
Total Growth -€5,771.53

Portfolio Breakdown

The table below shows the breakdown of my portfolio into the various asset classes:

Portfolio Asset Breakdown (as at 30th April 2022)
Equities €121,439.63 47.90%
Real Estate €91,369.76 36.04%
Cash €40,703.63 16.06%
Total €253,513.02 100.00%

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