Q3 2019 – Exposing myself

Quarterly return posts supplement my monthly Financial Dashboard, covering investments in detail and looking at my yearly targets. Here I track purchases and sales, document progress against my (in progress) investment strategy, and discuss re-balancing and changes over time.

I apologies for the title of this post. I am, at best, an overgrown manchild.

Q3 Returns:

Q3 Net Worth

  • Cash Savings Accounts £4200 (+£1000)
  • Investments £1550 (+£675)
  • Property £34,450 (+£1150)
  • Cars £2500 (-£500)

My net worth now sits at £40,350, an increase of £4.8k over the past three months, which is a pretty damn stonking (I’ll come onto this a bit more in Goal 3). This makes my rolling twelve month increase £18,000. Remaining strong. I’ve written down the worth of one of my cars for depreciation.
Yearly Targets:

Goal 1: Build an emergency fund

My first 2019 goal was to build an emergency fund, as per the r/UKpersonalfinance flow chart (1). My goal emergency fund is three months total household expenses (£6k) in my name, plus a further three months (£6k) held jointly. I now currently hold £3100 in my name, and £900 held jointly. I need to double down on this over the next few months to try and achieve the £6k figure by the end of the year.

Goal 2: Pay off short-term debts

Short Term Debt Q3

This goal has been achieved. Done. Sorted. I dip into my credit card now only for purchases where I want the security of the Consumer Credit Act 1974. Moving on…

Goal 3: Save 25% of my earnings

Savings Rate Q3

I calculate my savings rate using this formula:

Savings rate as % = ((Income – spend) + Cash savings + Investments + Pension contributions) / (Income + Pension contributions)

Having paid off all my unsecured debt, I’ve been able to channel money into savings a bit better. My current mean savings rate for 2019 is 21.48%, still short of my goal but closing in.

The interesting aside here is my three month net worth gain does not marry up with my savings rate. Gaining £4.8k would suggest a £1.6k/month increase, and at a 35% savings rate (average over the last three months), I’d have to be earning £4.6k take home! I am not earning £4.6k take home. I am not earning £4.6k gross. Try half that.

So where’s it coming from? My investments have (aside from new holdings) mainly tread water, and the local house prices are holding firm. As ever I think this is a demonstration of how you can get numbers to show you anything you want. Here, the rise is due to my decreased student loan, increased property equity and increased joint holdings. It’s all noise.

Goal 4: Live more sustainably

Our drive to weekly healthy dinners has meant less packaging and more local or home grown food. We’ve also been enjoying the harvest glut, which means less imported food. An area to focus on next quarter.

Goal 5: Commence investing

I’ve been better at investing this quarter, but still not at the automated stage yet. Some subconscious barrier is preventing me, by telling myself that I need to hold it out for other positions not on my ISA platform. For the next three months I intend to invest in an automatic way each month into one of my current holdings. Because it’s now not just one.

Q3 Types

In the past three months I did the bad thing, first by opening a couple of CrowdCube investments. I put a small amount of money into the second of the two Freetrade raises, having missed out on the first round due to the CrowdCube glitch. I like what Freetrade are doing, I think they have a good model which has worked previously overseas (RobinHood in the US for example), and I don’t think they’re particularly overvalued (2). I have gone into the psychology of crowdfunding platforms, but suffice to say I don’t think FreeTrade were there to exploit the psychological ploys. It’s also a company I would, and will, use.

If you’re interested in trying Freetrade and want a free share to boot, drop me an email.

The other crowdfunding investment I made was in a small mining company called Cornish Lithium ltd (3). They were exploiting the psychological ploys, and this investment was pure, emotional, domestic-market-biased speculation. Laugh if you choose, it was the cost of a fancy dinner out and it’s sitting as a leaden, illiquid lump in my active satellite picks. I’m hoping it was a better bet than Sirius Minerals (or Wolf for that matter) are turning out to be (I hold neither).

Global Exposure.JPG

In the passive core of my investments, I opened an investment in Vanguards FTSE Global All Cap Index Fund (4). This supplements my current Developed World ex-UK holding, adding some emerging markets exposure and small cap. Is it worth bothering with? The Accumulator over at Monevator reflected last week on the 10 year returns across the market, and the little difference emerging market holdings have made (5). I was also torn between this and the Vanguard FTSE All-World UCITS ETF (6). Ultimately I decided to be a purist for the passive global argument; the All Cap is slightly cheaper (OCF 0.24% vs 0.25% for VWRL), and the concept is to capture the whole of the market. The All Cap Index Fund does just that, whereas the All-World lacks the small cap. The small cap gains probably won’t beat the dividend gains available through VWRL, making this a principled rather than pragmatic choice, but we’ll have to let history decide.

Until next time,

The Shrink

  1. https://www.reddit.com/r/UKPersonalFinance/
  2. https://www.crowdcube.com/companies/freetrade
  3. https://www.crowdcube.com/companies/cornish-lithium-ltd
  4. https://www.vanguardinvestor.co.uk/investments/vanguard-ftse-global-all-cap-index-fund-gbp-accumulation-shares
  5. https://monevator.com/10-year-retrospective-what-a-decade-of-returns-tells-us-about-passive-investing/
  6. https://www.vanguardinvestor.co.uk/investments/vanguard-ftse-all-world-ucits-etf-usd-distributing/overview

Q2 2019 – Green Credentials

Quarterly return posts supplement my monthly Financial Dashboard, covering investments in detail and looking at my yearly targets. Here I track purchases and sales, document progress against my (in progress) investment strategy, and discuss re-balancing and changes over time.

Q2 Returns:

Q2 Net Worth

  • Cash Savings Accounts £3200 (+£400)
  • Investments £1550 (+£1000)
  • Property £33,300 (-£1000)
  • Cars £3000

My net worth now sits at £~35,400, an increase of £2.2k over the past three months, which is a little less impressive than the previous quarter. This makes my rolling twelve month increase £14,900. Cannot complain.

Yearly Targets:

Goal 1: Build an emergency fund

My first 2019 goal was to build an emergency fund, as per the r/UKpersonalfinance flow chart (1). My goal emergency fund is three months total household expenses (£6k) in my name, plus a further three months (£6k) held jointly. I now currently hold £2650 in my name, and £300 held jointly. Some way to go.

My Santander 5% saver matured, so those funds were moved into a new high interest Nationwide current account. I used the excellent Bank Account Savings website plus Money Saving Expert to select another regular saver, opening a joint current account with First Direct for their switching bonus and then a linked 5% savings account (2, 3). I’ve also started squirreling cash into a Starling pot. The intention is to have liquid savings spread across three or four independent banks, with different card providers (MasterCard vs Visa). Protection against business and liquidity risk.

Goal 2: Pay off short-term debts

Short-Term Debt Q2

This has been the area of greatest progress. At the start of 2019 my short terms debts stood at £1.25k to family and £2.6k on 0% interest credit cards, then £250 and £2k respectively at the end of Q1. Those figures are now £0 and £650, and the credit card should be cleared this month. This will leave me free of unsecured debt for the first time in (I think) four years. Once the debt is clear, my money is free to be channelled into…

Goal 3: Save 25% of my earnings

Savings Rate Q2

I calculate my savings rate using this formula:

Savings rate as % = ((Income – spend) + Cash savings + Investments + Pension contributions) / (Income + Pension contributions)

My current mean savings rate for 2019 is 18.4%, short of my goal. I had a March outlier thanks to a tax refund, and in May my effective savings rate was close to zero due to work-related bills (exams, course fees etc). Worth noting in the NHS it’s expected you pay for your exams, courses and training yourself. You can claim it back through tax, but only certain elements. The rest you take on the chin.

Goal 4: Live more sustainably

I’ve been pretty crap at keeping track of what we’re using from the garden rather than purchasing. With summer in full swing we’re getting at least two dinners a week just from home-grown produce. We’ve also made lots of little changes around the house to move away from plastic. These have included:

  • Switching toilet roll

We looked into the brand ‘Who Gives A Crap’, but I was pretty pissed off to find out all their recycled/ bamboo eco loo-roll comes on a slow ship from China (4). Not exactly sustainable. Instead we used The Ethical Consumer, an amazing website that ranks consumer products by multiple ethical/ sustainable/ fairtrade measures, to find Ecoleaf by Suma (5). Suma are a co-operative in the UK who have been producing sustainable, fairtrade products since the 80s.

  • Shampoo bars

Again we tried to use The Ethical Consumer. We actually found the Lush ones are pretty good, and despite costing £8.50/each, they seem to last a couple of months (6).

  • Washing powder ball

The Ecozone Eco-balls we bought are supposed to last 1000 washes (7). A recent change, so we’ll wait to reserve judgement.

  • Switching cleaning products to Method

Nice and easy as they’re stocked in mainstream supermarkets.

There’s loads of guides and blogs out there with tips on how to live with less plastic. I’d recommend starting off with the 100 Steps to a Plastic-Free Life (8).

Goal 5: Commence investing

I’ve not been very disciplined investing this quarter. In April I topped up my existing holding, but in May I held cash back to open a crowdfunding investment (still pending). My cash savings are calculated towards my Personal Allowance, whilst my investments are held in my Vanguard ISA. I have managed to get my investment portfolio spreadsheet at a stage I’m happy with (for now), so here’s a few example graphs:

Tax Efficiency Q2

Region Allocation Q2Country Allocation

Because I’m contrary, I’ve decided to actually try to calculate my worldwide exposure on a country by country basis. I currently just hold Vanguards Developed World Ex-UK Fund. I’m far more exposed to the US than I’d like, and so I’ll be opening some new holdings to diversify over the next two quarters.

Until next time,

The Shrink


  1. https://www.reddit.com/r/UKPersonalFinance/
  2. https://bankaccountsavings.co.uk/
  3. https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/
  4. https://myplasticfreelife.com/2017/09/who-gives-a-crap-recycled-or-bamboo-toilet-paper-without-plastic/
  5. https://www.ethicalconsumer.org/home-garden/shopping-guide/toilet-paper
  6. https://www.independent.co.uk/extras/indybest/christmasgifts/fashion-beauty/shampoo-hair-soap-plastic-free-green-beauty-environmentally-friendly-a8505026.html
  7. https://www.ethicalsuperstore.com/products/ecozone/eco-balls/
  8. https://myplasticfreelife.com/plasticfreeguide/

Quarterly Returns – Q1 2019

Quarterly return posts supplement my monthly Financial Dashboard, covering investments in detail and looking at my yearly targets. Here I track purchases and sales, document progress against my (in progress) investment strategy, and discuss re-balancing and changes over time.

This post marks one year of my blog. One year of posting rants and general waffle. It marks a new year, and the end of the old tax year, so how did I get on in my Q1 of 2019?

Q1 Returns:

Net Worth Q1

  • Cash Savings Accounts £2800 (+£1000)
  • Investments £1000 (+£1000)
  • Cars £3000

My net worth now sits at £~33,200, an increase of £4.7k over the past three months, and up dramatically from the £~20,000 I first wrote about twelve months ago. I’m fairly sure I won’t be able to keep up a 60% increase in net worth, but I’ll keep a twelve month rolling calculation out of curiosity.

Yearly Targets:

Goal 1: Build an emergency fund

My first 2019 goal was to build an emergency fund, as per the r/UKpersonalfinance flow chart (1).

I’ve continued to add to my Santander 5% regular saver, which will reach maturity this month. It currently stands at £2200, which is a month of total household expenses at our current spending, or two months of my half. I’m now looking to set up another regular saver. I’ve parked some extra cash to pay for upcoming car and work related expenses. In the past three months I’ve decided I’m going to define my goal emergency fund as three months total household expenses (£6k) in my name, plus a further three months (£6k) held jointly. This seems a fairly realistic target for the next year.

Goal 2: Pay off short-term debts

Q1 Short Term Debt

At the start of 2019 my short terms debts stood at £1.25k to family and £2.6k on 0% interest credit cards. In the past three months I’ve paid £1k off our loan to family, but some significant work expenses had to go on my credit card, so that figure has only come down by £600. I’m going to have to work hard to achieve my goal of clearing my credit card by the end of Q2.

Goal 3: Save 25% of my earnings

Q1 Net Worth

In the past three months my savings rate has gradually increased, but it’s a bit early to take averages, particularly with the March outlier. I calculate my savings rate using this formula:

Savings rate as % = ((Income – spend) + Cash savings + Investments + Pension contributions) / (Income + Pension contributions)

Where income minus spend equals the money left from my income in my accounts at the end of the month. It’s important to note I don’t include any mortgage payments in this (i.e. increased equity), nor do I include reductions in debt. This is purely the amount I have been able to save out of my earnings. I see some arguing that imputed rent or equity increases should be included in savings, but for me this figure is a literal savings percentage. Equity/ debt changes show up in my net worth, which accounts for the rapid increase in net worth concurrent with a piddly savings percentage.

Goal 4: Live more sustainably

Some success here. We’ve reduced our plastic usage, we’re eating more locally and sustainably sourced food, and I’ve finished setting up our mini-market garden with new raised beds for veggies and some pet chickens. As things start to crop I’ll add them up and work out cost savings from homegrown produce.

Goal 5: Commence investing!

Q1 Tax Efficiency

I’ve taken the plunge. March’s tax rebate has been quickly squirrelled into a Vanguard S&S ISA. I opted for the FTSE Developed World ex-U.K. Accumulation Fund, buying at £352.62/unit. I learnt a quick lesson in a) market timing and b) not checking investments too frequently, as literally the day after the price fell to £341/unit. I’m not in it for short term gains, I told myself.

Since then I’m trying to avoid impulsively checking the NAV every hour (bloody idiotic), busying myself building a spreadsheet to track returns and allocations. Like many others my intention is to unitise my portfolio (1, 2, 3, 4). I’ve been reading about this methodology through (as usual) Monevator, and also Bogleheads which has a fantastic portfolio spreadsheet (5, 6). Hopefully by the end of Q2 it should be ready to be unveiled.

Until next time.

The Shrink



  1. https://firevlondon.com/2017/01/17/my-investment-tracking-spreadsheet/
  2. https://www.ukvalueinvestor.com/2018/08/how-to-manage-a-portfolio-of-shares.html/
  3. https://simplelivingsomerset.wordpress.com/2019/01/11/unitising-my-portfolio-shows-i-sucked-last-year/
  4. https://en.wikipedia.org/wiki/Unit_valuation_system
  5. https://monevator.com/how-to-unitize-your-portfolio/
  6. https://www.bogleheads.org/wiki/Calculating_personal_returns#GoogleDocs









Q4 and 2018 in Review

Quarterly return posts supplement my monthly Financial Dashboard, covering investments in detail and looking at my yearly targets. Here I track purchases and sales, document progress against my (in progress) investment strategy, and discuss re-balancing and changes over time.

So that was that, my first year properly tracking my finances, getting my head screwed on and documenting warts and all. There was the little matter of house moves, a wedding, a honeymoon, two job changes… but never mind all that jazz, how did I get on in Q4 and in relation to my yearly goals?

Q4 Returns:

net worth

  • Cash Savings Accounts £1800 (+£800)
  • Investments £0
  • Cars £3000

My net worth now sits at £~28,500, an increase of £6.5k over the course of the year and £8k since I started tracking in this spreadsheet. Including pension contributions my average saving rate was 15% (5.5% without). This is an area I want to target next year, so alongside simplifying my spreadsheets ahead of investments I will set a 2019 goal to save 25% of my earnings.
Yearly Targets:

Goal 1: Build an emergency fund

My first 2019 goal was to build an emergency fund, as per the r/UKpersonalfinance flow chart (1).

Partial success for 2018 here, as I now have £1600 set aside in a high-interest regular saver. This is equivalent to two months of my contributions to our shared expenses, or one month if I had to pay for everything alone. Foolishly (naively) I put this in an account that pays yearly interest and therefore I’m still using credit cards as my emergency fund until the account matures in a few months time. At that point I’ll shift it to a high-interest current account, using the bank account savings website (2). I mentally recover some pride that I’ve been implementing a pay-myself-first policy, with money going straight into this saver on payday. I’ve also saved a little in my Starling current account (wooo 1% interest), and I now have money in my account at the end of each month instead of being in my overdraft. MrsShrink and I are aiming to hold three months worth of our combined household expenses in our joint high-interest current accounts, and I plan to hold another three months in my accounts. This is a goal I’ll continue to work on for 2019.

Goal 2: Pay off debts

At the start of the year my short terms debts stood at £2.5k to family and £4.3k on 0% interest credit cards. By the start of Q4 this had come down to £1.25k and £4.1k respectively. When I consider the intervening house move and wedding, I’m not too frustrated by the persisting credit card debt. I’ve managed to go through two of the most expensive lifetime experiences without sinking further into the red.

We’re due to start paying down the rest of the loan to our family next month. In the meantime I’ve been paying down credit card debt, which now stands at £2.6k. I’ve closed one redundant (emergency use only, therefore empty) credit card, which actually hit my credit rating as my % usage shot up. I increased my monthly payments to £350 and plan to have my debts cleared within six months (a goal for 2019). Another partial success, which I will slightly rephrase to “Pay off short term debts”. As TI says over on Monevator, I’ve been borrowing from my future self (3).

Goal 3: Reduce superfluous outgoings

This is where I feel I’ve had the most success this year. My headline outgoings have dropped from ~£3300/month to ~£2500 for the household. At the start of the year we were paying rent on one property, a mortgage on another, utilities for both plus storage fees for some of our furniture which was in limbo.

household costs graph

The front-loaded wobble in April/ May/ June was when we moved house twice in two months (while also getting married). Think we seriously confused the local councils.

This was a big reduction in our outgoings, but to push further I need to cut other costs. I’ve already covered my gradual reduction in car spending in Decembers’ Dashboard, so what about going out, groceries and daily living expenses?

household spending

This busy graph is summary data from my Beast Budget spreadsheet. It’s actually the first time I’ve looked at it fully. On first glance it doesn’t look very positive, but I only began tracking many of these items properly (i.e. for both my account and our joint account) in April. If we take out grocery and eating out temporarily as the biggest spends we can see I’m spending a bit more on exercise, less on food at work (no more over-priced canteen lunches!) and about the same for the rest.

ancilliary costs

A target goal for most of Q4 in my Financial Dashboard has been to set a realistic budget for our household food expenses. Over the year we’ve been successful in eating out less, but we’re spending a lot more on food at home. The numbers spite the lies I tell myself.

groceries and eating out

So where is all that grocery money going? To get a clear picture I went through all my accounts for the year and totted it up.

groceries count

groceries graph

We’re fairly consistently spending ~£400 a month on food. Earlier in the year we spent about £300/ month, split between lots of £20 trips to Lidl/ Aldi, and fewer bigger (£50-80) top up shops in big supermarkets. In July we started to get an organic local veg box (pretentious? moi?) and meat box from a local butcher delivered. I had hoped this would cut our costs at the supermarkets, but it looks like we’ve continued to spend the same and this has come in on top. Frustrating! For Q1 2019 we’ll set a monthly target to spend less than £300/month on food as part of my Financial Dashboard goals.

Despite the increased cost we’re going to persist with the local veg and meat. Restricting ourselves to one meat delivery a month means we eat a healthier more varied diet, and the meat itself is fantastic quality making it a treat to have. It comes from a family farm <50 miles away, and the animals live good lives cared for by the butcher’s father and grandfather. There’s been a massive push to highlight the impact of meat on the planet and climate change, but there is little else that would survive the hillfarms of Wales than the hardy sheep (4)! Brexit may also impact the availability of cheap meat from the continent, so I’m securing my protein supply early. Likewise cheap imported fruit and veg may be on the wane, and the quality of our locally delivered veg is fantastic. I enjoy the seasonal variety (it challenges my cooking!) and I’m hoping to grow more through the year to reduce costs and add flavour.

The local veg and meat tie into a goal for 2019; to live more sustainably. This is fairly loose (like many of my topline goals) but will include things like reducing household waste, reducing our travel footprint, cutting food mileage and waste, growing our own food and generally getting rid of all the meaningless plastic tat. I’ll keep a track and will hopefully run a “grow my own savings” spreadsheet like Jono at Real Men Sow (5).

Goal 4: Commence investing!

So this is a partial fail, and I’m not unhappy about that. 2018 has been a crap year for the markets on both sides of the pond (6, 7). Close friends inherited from family members in August and have lost 10% since. I had (again naively) planned to start investing sometime in the middle of the year, but put it off to set an investment plan, pay down my debt and get a solid emergency cash fund. I’m glad I chose to focus on my foundations before building a wobbly investment house. 2019 will be the year of investments.
2019 Goals

  • Goal 1: Build an emergency fund
  • Goal 2: Pay off short-term debts
  • Goal 3: Save 25% of my earnings
  • Goal 4: Live more sustainably
  • Goal 5: Commence investing!

The best of luck to everyone for their 2019 aspirations!

The Shrink


  1. https://www.reddit.com/r/UKPersonalFinance/
  2. https://www.bankaccountsavings.co.uk/
  3. http://monevator.com/why-you-must-get-out-and-stay-out-of-debt/
  4. https://www.theguardian.com/environment/2018/dec/21/lifestyle-change-eat-less-meat-climate-change
  5. http://www.realmensow.co.uk/?page_id=175
  6. https://www.bbc.co.uk/news/business-46720637
  7. https://edition.cnn.com/2018/12/31/investing/dow-stock-market-today/index.html

Quarterly Returns Q3 2018 – Goal-scoring accuracy

Quarterly return posts supplement my monthly Financial Dashboard, covering investments in detail and looking at my yearly targets. Here I track purchases and sales, document progress against my (in progress) investment strategy, and discuss re-balancing and changes over time.

Q3 Returns:

Net worth Q3

Getting married and moving house were fantastic experiences, the peak of our year in a summer that will be remembered for sun, but they would not please Mr Scrooge. Rough sums suggest we spent around £15,000 on our wedding, half the national average of £30,355 (1). The actual figures in my spreadsheet are less, but some things like the price of MrsShrink’s wedding dress I’m just not allowed to know! About a 1/3rd of the costs were paid for or made by family. Like Mr & Mrs YFG at some point I’ll probably relate how we kept our wedding cheap (2). Moving house cost another £~5k through stamp duty and solicitors fees though this didn’t come out of our bank accounts. We safely avoided a painful potential £8k early repayment charge on our mortgage. We saw the £~5k cost through loss in our net worth as it was paid out of the equity in our previous property.

We’ve spent another £4,240 to date renovating the house, with new fixtures, fittings and soft furnishings throughout. This was mainly materials (and bloody curtains) as I can turn my hand to most DIY, and MrsShrink is a dab hand with a paintbrush. We did spend £1400 on plumbing work, but I’ll detail all when I get round to writing a property renovation post. The majority of the work is now done, with just a chimney cap rebuild (Jan 2019), new bathroom (~Q3 2019) and new kitchen to go (2020ish). My net worth has gradually increased during these months, but at a slow old rate. Current investment assets stand at:

  • Cash Savings Accounts £1000 (+£600)
  • Investments £0
  • Cars £3000

I am starting to value my books and art. I’ve accumulated a number of first-editions over the years, and a few original pieces of artwork by famous illustrators. I may keep this ‘off the books’, but interesting to know as a fallback.

Yearly Targets:

Goal 1: Build an emergency fund.

As per the r/UKpersonalfinance flow chart, I’m working towards building an emergency fund (3).

We currently have a month’s outgoings in our joint account (some of this will be eroded by our honeymoon), and I’ve another months parked in my savings account. MrsShrink and I will aim to build six months worth of our combined household expenses held across multiple high-interest current accounts. We’ll maximise the returns on this using the bank account savings website (4).

Goal 2: Pay off debts

At the start of Q3 my short term debts were £1.25k to family and £4.1k on 0% interest credit cards. We’ve talked with the family member who lent us the money, who doesn’t want it back until next year. I’ve instead focused on my credit card debt, which now stands at £3.6k. Some expensive exams and unexpected work costs haven’t helped. In future this will be budgeted for, with the emergency fund just in case. I still need to close my two redundant accounts, which currently prop up my credit score (as % of total credit used is low). As TI says over on Monevator, I’ve been borrowing from my future self (5). Following the good advice, I’ve been selling unwanted items to try and clear this further. I’m also planning to increase my monthly credit card payments from £250/month to £350/month to clear it earlier

Goal 3: Reduce superfluous outgoings.

Some serious differences been made here. The major influence has been that we’re no longer paying rent in one city where we live and mortgage on another home we never see. This has seen our monthly outgoings drop by at least £600/month. I’ve also made progress on my own personal spending, cutting down to a monthly budget. We’ve got further to go on our household grocery expenses, and on my hobbies, but all progress.

Goal 4: Commence investing!

This was the target for Q3, but I now recognise this was a little naive. As mentioned in this week’s Full English I’ve been watching the market ‘turbulence’ with interest. The argument that the earlier you invest the better is strong, and I’m well aware of the benefits of dollar-cost averaging (6, 7). Then there’s AWOCS’ tale of Bob, the world’s worst market timer (8). I’m uncomfortable commencing investing whilst my short-term debts, particularly my credit cards, exceed my liquid cash. Therefore the aim is to complete my investment strategy statement this quarter.

I’ll check in again in three months and see how things are getting on.


  1. https://www.independent.co.uk/life-style/love-sex/wedding-cost-uk-average-how-much-marriage-ceremony-bridebook-a8460451.html
  2. https://youngfiguy.com/our-unconventional-and-cheap-wedding/
  3. https://www.reddit.com/r/UKPersonalFinance/
  4. https://www.bankaccountsavings.co.uk/
  5. http://monevator.com/why-you-must-get-out-and-stay-out-of-debt/
  6. http://uk.businessinsider.com/compound-interest-retirement-funds-2014-3
  7. https://www.investopedia.com/terms/d/dollarcostaveraging.asp
  8. https://awealthofcommonsense.com/2014/02/worlds-worst-market-timer/

Quarterly Returns Q2 2018 – A Tale of Two Cities

For my first quarterly return, I’ll lay out the basic plan for the future, and then tell a little story of hindsight.

Quarterly return posts will supplement my monthly Financial Dashboard, but with a different focus. While the Financial Dash mainly deals with my day-to-day, week-to-week goals, budgeting, the Quarterly Returns will cover investments in detail and look at my yearly targets. Here I will track purchases and sales, document my investment strategy, and discuss re-balancing and changes over time. Inevitably there will be some overlap, but I’ll try to minimise this.

Eventually the plan is to display some pretty graphs of exposure, increase over time etc. As I’m still developing my spreadsheets, for now I’ll just make a nice list.

Q2 Returns:

  • Cash Savings Accounts £400
  • Investments £0
  • Esoteric tat £3000


Yearly Targets:

Goal 1: Build an emergency fund.

As per the r/UKpersonalfinance flow chart, I’m working towards building an emergency fund (1).

I currently have a month’s outgoings in our joint account, and working towards two months. I’m chipping away at this, but now I have a month’s worth tucked away (and completed some fairly massive life-costs) I’m going to target debts.

Goal 2: Pay off debts

At the start of Q2 my short term debts were £2.5k to family and £4.3k on 0% interest credit cards. These are now £1,250 and £4.1k respectively. The aim is to bring my credit card debt down gradually, but as it’s at 0% for another 2 years I may indulge in some stoozing (2). I can also now close two redundant credit cards now I have no upcoming credit applications.

Goal 3: Reduce superfluous outgoings.

I’ve managed to reduce my living costs (see below), but an area for future work.

Goal 4: Commence investing!

The target for Q3.

A Tale of Two Cities

Inspired by Ermine’s tale of a dumb property purchase, here’s mine (3). This is a story of opportunity cost, the British love affair with owning our own home, and how as a person sometimes buying is not the right thing to do.

As mentioned in my Musing On… Mortgages post, MrsFireShrink and I were lucky enough to purchase our own home in our mid-20s. There are plenty of reports and opinion pieces currently doing the rounds, detailing how a third of my generation “will never own a home”, how it’s a housing crisis and changes must be made to the broken market (4, 5, 6). Wind back to 2014, and those worries are starting to bubble to the surface, but not yet in the public consciousness.

In those heady, pre-Brexit, pre-coalition-of-the-contemptible days house prices are still rising. Property is still a sure thing. We’re over the 2008 wobble, Dave Cameron is in charge and ‘the city’ and financial markets are looking bullish. Every man and his dog is flipping the equity from their own home into a nice little BTL side-hustle, an earner for retirement, inheritance for the children. The market looks nice and rosy, house prices always go up, right…. right? (7):

Enter stage-left MrsShrink (then MissFrugalStrongIndependentWoman) and I. We sat and planned our future together. I was living in work digs, 150 miles from MrsShrink. These were particularly miserable NHS digs, built after the war and updated when things broke, sometimes (for example see below) (8). Lying on my lumpy single bed as snow, rain and hail came through the single-pane aluminium-framed windows (which you couldn’t shut properly) I dreamt of a home to call my own. Heating that wasn’t on flat out, 24/7, even in midsummer. An oven that worked, A gas hob younger than me. A fridge lacking CFCs, etc.

The saving grace of these digs was that they were cheap. Really cheap. 90% of my earnings was paying off accumulated student credit card and overdraft debt, or sitting in our first, joint, savings account. MrsShrink and I knew nothing of investing, and to this day MrsShrink is fearful and does not trust the markets. Our plan saw me moving back to join MrsShrink in the city we had studied in, which we had both fallen in love with.

MrsShrink was equally frugal. She had moved in with a friend who had recently bought and was renovating a small terrace. While it was uninhabitable she was staying at his parents, paying a tiny rent, but not ideal accommodation. 6 months in and she was desperate for her own space.

With a small gift from MrsShrink’s mother we had enough for a deposit. The city we studied in was located in the South. A port city, bombed in WW2 and with high unemployment. Lively, cheap to live in, plenty going on and lots surrounding. Rows of identical, overengineered victorian terraces meant housing was around the national average despite being in the South. Early on we decided we wanted something old, with features, with potential but a manageable project.

The house

We spent six months viewing 20+ houses. We watched perfect houses get snatched up by people outbidding us. We viewed some real shitholes, rotten floorboards and collapsing joists. We stretched a bit and leveraged to 90% LTV on 200k. We planned to be there until we had kids, so fixed for 5 years. In 2014, everyone predicted an interest rate rise.

Eventually we found a place. It was a bad house on a good street, with agents pushing for much more than it was worth. In an area of high demand it had been sat for a year. [Warning sign]. It was vast, full of old features and 10% over budget. It also stank of fags and had some qwalitee 90s additions. Faux plastic panelling and fibreboard partitions anyone? [Warning sign]. The electrics had recently been done (cheaply) as had the central heating (cheaply) [Warning sign].

All this didn’t matter. We were in love with it. We could own this big house on this lovely street, all our own! We’ll renovate it, start a family, make loadsa-cash.

The troubles

We put down an offer for 5% under asking, which was accepted after a bit of haggling. We organised a full structural survey. This showed some damp and rot in the downstairs structure, so we went back to the vendors and knocked another 5% off. We were now on (just) budget. We weren’t fazed by this, every old house needs some work, and for houses where the vendor has been there over 10 years a survey may be the first time anyone looks for problems for a while.

The survey also stated that the walls were covered with thick wallpaper, as were the ceilings, and so the structure was impossible to examine. Fair enough said we. [Error]. As first time buyers we were a quick sale. Besides we were now desperate to be in. We wanted our house. [Error]. We completed within two months.

Walking back into the house for the first time, we were hit by a wall of fag-smell. Didn’t matter, we loved it. We held a party where we provided pizza and equipped all our mates with wallpaper stripping kit. The nicotine/tar ran out of the walls in rivulets. We all got contact high. Once we removed six layers of wallpaper and wood chip (spawn of the devil) the resultant 120-year old plaster was absolutely dead, falling off in chunks.

So it continued. I won’t document it all, but selected lowblows included:

  • Undiscovered rotten joists
  • Woodworm
  • Live bakelite or cloth-wrapped wiring throughout which hadn’t been removed, just run as parallel circuit
  • Replastering throughout as rooms sequentially were found to have collapsing or damaged plaster
  • Drains collapsing, prompting the external stack to back up and digging out 12ft of liquid shit in midwinter
  • Fibreboard dropped ceilings in bedrooms hiding fire damage
  • Asbestos boarding
  • Boiler wired through twist-and-tape off a socket, with no fuse
  • Porch collapsing due to rot hidden behind a fascade

Lots of the work I completed myself. The sleet helping to wash off six month old faeces was a particular joy. We dropped about £15k over three years completely renovating. I hate to think what it would cost in labour, as I did 10+ hours a week on it in addition to my 60 hour work week.

The move

Three years into owning our home I was offered my dream job, one that I didn’t believe would ever happen, working with some of the top people in the world. Snag; it’s 150 miles away in another city. After discussions, I moved to pursue it, with MrsShrink following when she found work. We spent the following six months finishing the house to a high standard travelling the 150 miles at weekends. We never got to appreciate the fruits of our labour.

Facing financial pressure, paying rent and bills on one home and a mortgage and bills on an empty one, we put it on the market. We had to port our mortgage to avoid a hefty 5% early repayment charge. An asking price offer made within a week of listing fell through three months later, days before exchange. Another offer fell through a month later. We finally accepted an offer 10% under asking price six months later. We completed two months after that, exchanging on our new property on the same day.

The moral

Why am I telling this story? Through sweat, tears, blood and new grey hairs we made £15k net profit. About what the house would have gained through local market forces anyway. We have more equity in our new property and gained a lot of experience for the purchase of the current house:

  • Don’t overlook flaws because of love unless you’re willing to pay for them in time, stress or money
  • Don’t assume that a survey finds everything (or is even worth the paper it’s written on)
  • The more layers of cosmetic presentation/ furnishing/ detail in a house, the more it can hide
  • You may not make money on property
  • You can’t tell what tenants are like until you see how they live
  • Market estimates are dung; something is worth what people are willing to pay for it
  • Get paperwork evidence for everything
  • Houses naturally depreciate over time, they fall down if uncared for

Ultimately we learnt the hard way that early in life mobility for work can be a greater asset than equity. The British romanticism of owning our home hamstrung us and tied us to a financial obligation. As young professionals we could have been better served by considering our mobility as an asset. Don’t settle down until you really know you’re going to. There endeth the lesson for 20-somethings.


  1. https://www.reddit.com/r/UKPersonalFinance/
  2. https://en.wikipedia.org/wiki/Stoozing
  3. https://simplelivingsomerset.wordpress.com/2014/04/06/when-not-to-buy-a-house-a-cautonary-tale-from-a-quarter-of-a-century-ago/
  4. https://www.moneywise.co.uk/news/2018-02-16/homeownership-among-millennials-plummets
  5. https://www.theguardian.com/money/2018/apr/17/one-in-three-uk-millennials-will-never-own-a-home-report
  6. https://www.theguardian.com/society/2018/apr/28/proportion-home-owners-halves-millennials
  7. https://www.ukvalueinvestor.com/2018/06/uk-shares-uk-property-better-value.html/
  8. http://s0.geograph.org.uk/photos/41/10/411045_a8075d90.jpg

The Yearly Plan

The first yearly plan for my finances, this data is just before tax-year 2018/9.

Up until now I’ve been pretty ad hoc with my finances, much like most professionals (I assume). Budgets are based on how far into my overdraft I am and spending in line with my means. Big surprise bills go on 0% credit cards. I’ve always spent as much as I’ve earned, and have limited tolerance for overexposure (unlike some colleagues). Time now for a change and some structure, namely the flowchart from r/UKpersonalfinance

My main debts are mortgage, credit card, and a small loan to a family member to pay for our wedding. The loan has no interest, and the credit card is 0% for another 2 years. I make more than minimum payments (usually 10x) each month.

Goal 1: Build an emergency fund.

Initially one month, but I’d like 6 for security. I’ve been investigating where to put this, and reading about new banks for current accounts. I’d like to have the benefits of a digital bank as I’m abroad a few times a year. This appears to be a good summary:


So I may set up a Starling account and a Santander 1-2-3 regular saver for it’s 3% interest rate.

Goal 2: Pay off debts

Simple really, but I’ll set up a plan rather than ad hoc.

Goal 3: Reduce superfluous outgoings.

Not too many, but deserves it’s own post.

Goal 4: Commence investing!

I’ll check back in quarterly to see how I’m meeting goals.


The FIRE Shrink