Some goals for 2015

Mr Zombie   December 10, 2014   8 Comments on Some goals for 2015

2014 has been a good year for this Finance Zombie.

After stumbling across blogs like Financial Samurai, RIT, simple living in Suffolk, FFBF and The Escape Artist (to name but a few) I got to grips with the idea of Financial Independence, had a bit a light bulb moment that FI is indeed possible and got to work trying to escape the Horde.

I started tracking my Net Worth in the summer, at first monthly and now weekly.  If you don’t do it, I highly recommend it.  Do it in Excel, on Mint on a scrap of loo roll.  I was pleasantly surprised how my pension investments were doing and using that I grabbed me some motivation and started saving more aggressively.

I had another lightbulb moment last week.  So many blogs out there highlight the importance of spending less that you earn, reducing your spending and only spending on what you really need.  After reading this over 1 million times, it finally clicked that by getting used to spending less now, we reduce our normal outgoings and so we need to accumulate less to become FI on and so we can bring the date of FI forwards!  And, it doesn’t have to be painful.  We don’t have to live a life of sacrifice, staring at shiny new things and wishing we had them.

I am lucky that I have never been a particularly material person, I couldn’t car less what car I drive or if my pants are from Gucci or George.  But I can chew through money while spending on hobbies, cycling, motorcycling, climbing etc 🙂  So I am in the process of still enjoying these hobbies, but I have realised that enjoying them doesn’t have to come from the buzz of buying new gear.  The carbon Time Trial bike will have to wait then…

By my pessimistic projections, FI by 50 is possible.  It’s a long road ahead, but I am fired up for the challenge.  We have increased our Net Worth by 10% since the summer and I have upped my savings rate to above 50% (it seems to jump around between 51 and 53%) but there is more to be done.

Net Worth as a % of value at 7 Dec

2015
To increase Net Worth by 40%

Given current saving rates and growth, this should be possible.
But, Mrs Z and I have decided to do some work doing on the house next year (bloody damp), which could be expensive.  This will put a dent in our savings at some point.

To increase my savings rate to 60%
I look at savings as a % of net salary.  60% looks doable in Excel.  Sadly Excel is not real life, and the reality of saving like this will be tougher.

Cycle 200 miles a month
Why not.  I like cycling.  This will be easy to hit through the summer months, but not so much in the winter.  Will be an accumulation target through the year.  Get me out of the gym and onto the road 🙂

Some accountability
I’m going to post my progress towards these goals each month.  Having them up in black and white will make success all the sweeter and any failure should provide some motivation to hit my target the following month.

At the moment I am not sure if I will post actual numbers or just a % progress towards a goal.  Any thoughts?

An idea
As an experiment I have set up a false portfolio, a really simple one.  I want to see how it does going forward, drawing down 4% each year. To see, theoretically, how someone invested in a few simple funds and an investment property would fare from month to month.

I want this to be as admin free as possible for me, so I’m not going to choose individual stocks or bonds, which might be unrealistic but hey-ho it should prove an interesting experiment, for me and any readers 🙂

Hope y’all are setting some tough financial goals for the New Year.

Spend less, save more, escape the Horde.

Mr Z

8 thoughts on “Some goals for 2015

  1. weenie

    Hi Mr Zombie
    I came across your comment on Financially Free By Forty so thought I'd stop by.

    Have just finished reading all your posts and really enjoyed them – love all the zombie references (are you like the mad 'World War Z' type of zombie or the 'Walking Dead' variety, lol?)

    I've enjoyed reading your revelations from reading other PF blogs and I for one would say that FI at 50 is highly doable for you – before then in fact, given that you already have a 50% savings rate and plan on increasing it!

    I really identified with your question in a previous post "at what point does a passive strategy become an active one" because I'm following a mostly passive strategy myself and to be honest, find it boring although I know it's meant to be – tortoise vs the hare and all that! The temptation to tinker is often quite difficult to resist.

    However, to counter the relative boredom, I've diversified into peer to peer loans, got some premium bonds (which I class as cash), started buying some individual shares to get some dividend investing going on and continually think of ways on how I can cut back on expenses but not sacrifice the quality stuff in my life that is important to me right now (no, I don't reuse my teabags, although I did when I was a student…!). I'm also not averse to earning a bit of online cash, all of which is shovelled towards my investments.

    Anyway, the best of luck with your savings, investments and your blog – I'll be stopping by again to see how you're getting on!

    Reply
  2. Keith Park

    FI is more about controlling spending rather than increasing income. I hope you achieve your 2015 goals and will look forward to future updates along the way. Increase that passive income stream too via dividend stocks.

    Reply
  3. Mr Zombie

    Hi! Thanks for reading and the comment. Walking dead def, a bit more subdued 😉

    Would awesome if I made it by 50 🙂

    You're right on the boredom thing – how are p2p loans and individual shares going? A lot more work to manage and choose?

    Reply
  4. Mr Zombie

    Hi Keith,

    I think you are right on controlling the spending, taken me a while to click on that one.

    My plan, at the moment as it's ever changing, is to carry on investing into ETF tracker until I reach some amount X. Once I'm above that amount I plan to invest in some dividend stocks, that way it gives me time to reseach as well.

    Thanks,

    Mr Z

    Reply
  5. weenie

    For me, I'm happy with my p2p loans, just letting the interest accumulate – only started in June so early days yet but seems good so far. Am getting an average 10.3% on my loans with Funding Circle, depends on whether you have an appetite for a little risk but of course, you don't have to loan out large sums. For a great blog post on p2p, check out http://financiallyfreebyforty.blogspot.co.uk/search?q=peer+to+peer

    As for individual shares, again, I've only just started getting into them – have bought the kind of shares that most other people have, eg GlaxoSmithKline, BP, Vodafone, the kind that pay good dividends and are for longterm hold. This is only a small part of my portfolio, the bulk is in index trackers, ie the boring stuff lol! But I'd love to have some shares that will pay enough dividends to cover some of my monthly outgoings.

    Again, for info on individual shares, Huw's the man to see!

    Good luck!

    Reply
  6. thefirestarter.co.uk

    Some good strong goals here Mr Z.
    I was going to say, if your savings rate is 51-53% each month that is a ridiculous level of low volatility and I have no idea how you manage that. We always get unexpected expenses cropping up and in recent months ours has been between -1.7% (i.e. spent more than earnt!) and 70%… haha! I am not worried too much and am just tracking the long term average so will see where it is at in January.

    I like the idea of the demonstration portfolio and will definitely be back to see how that goes if you end up doing it! Cheers!

    Reply
  7. Mr Zombie

    Hi! Thanks for the comment.

    It's only been like that since September really and I've been lucky since then, it was far more volatile early in the year and I expect it will be the same in 2015 Haha.

    Cool! I'm planning to as long as it's not too administration intensive 🙂

    Reply

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