Financial Update: November 2018

Welcome to the second financial update on this blog.

Well, this month was not the best one, financially. The market was moving sideways and I had higher expenses than usual. I didn’t remember the “personal finance motto”, as this Reddit post suggested: “No amount of fun justifies spending money in the present”. I LOLed when I saw it. 🙂

All jokes aside, being a Monk, my spending is never unexpected or irresponsible. We decided to take multiple short trips, as November is not the best month to be spent entirely in The Netherlands. December, January, and February aren’t as well. 🙂

However, since I had quite some time to switch off of the daily routine, it came naturally to think about my life and where I’m headed. These thoughts deserve their own post, but I’ll scratch the surface for the first time here.

So yes, I’m aiming for financial independence, aggressively saving, and expecting the day when I’ll be at 100% so I can start living as I want to live. But while switching off I had a few epiphanies. Life maybe shouldn’t be postponed until we’re completely free. Of course it sounds rational, but most of the things we like doing (as explained in the Why FIRE? post) are nearly impossible with the time and energy consuming machine taking almost full control over our lives.

But my point is: the time will pass anyway. At the end of the X years required to reach FIRE we can have a fresh start as the person we’ll build ourselves to today. Far from saying that I can have full control of how I’m currently living, but I can steer my life in a direction that can leave me better or worse off at the end.

By the way, this is not me saying that “I need to spend more to be happy” – far from it. As explained in the post I hate spending money, I really don’t believe in searching happiness or satisfaction in external things. What I’m saying is that maybe, and just maybe for now, we don’t need complete independence before we start pursuing our dreams or start becoming the person we want to.

For example, I thought about the concept of taking unpaid time-off. Yes, I’m at

OK, it sounds good, but there is one issue. And it’s pretty personal. Living on a visa butchers the above-mentioned flexibility, unfortunately. It is a parameter that drastically changes the direction of the “temporary retirement” concept, that I’ll stop here and make sure to talk about it more in a next post. But this is something you’ll read about quite a bit on this blog, for sure.

Lastly, I’m aware this was pretty shallow overview of my thought process, but I don’t want to hijack a Financial Update post to do an introspection. Consider it an announcement of things to expect.

Back to the update

So, where were we? Ah yes, weekly trips, more expenses, the stock market erasing the 2018 gains… Right. But the biggest loser of all was the cryptocurrency market. What a plunge this month! Luckily, it’s not that big part of my portfolio, but it can’t go unnoticed. Basically, all the coins I hold dipped to more than 40% from the previous month, and in a devastating fashion.

It’s fine though. I didn’t neglect the “don’t put more than you’re ready to lose” rule, so I’ll be perfectly fine if I lose everything there – which I won’t. Until then, I’m hodling and not turning off the mining rig, although it’s way less profitable than before.

We’re mining crypto, not fiat… It will go up. But don’t quote me on this. 🙂

On the optimistic side, I think that it’s a massive sell-off due to FUD that makes the weak hands lower the price even more. With the news on adoption and ETFs, terms like “market manipulation” come to mind, but I’ll stick to “just another cycle”.

In the previous financial update I mentioned that I’m not contributing to my crypto portfolio, but this month was so exceptional that I couldn’t resist not buying in some more. I mean, it’s the right thing to do, right? How was it… “Be fearful when others are greedy and greedy when others are fearful”. Hell yeah, I will be!

Needless to say, this is an instance where I did try to time the market and put around 1000€ in cryptocurrency (mostly in Ethereum). Let’s see where 2019 brings us!

In case you want to get into Cryptocurrency I’d recommend Coinbase (click here). If you use this link we will both get 10$ worth of Bitcoin when you invest your first 100$. I wouldn’t pour all my money in, but I really think it’s a good time to get in with an amount that you’re willing to risk.

So, the asset allocation for this month.

November Asset Allocation

Yup, not much to say here. The cash is still the biggest portion, ready to be used to finance unpaid leaves, getting into real estate, as an emergency fund, or a combination of any of those. We’ll see.

I bought my S&P 500 ETFs at the regular window at the end of the month.

Although I didn’t try to time this market, I bought at 23th November and it was a great experience to see the index take-off from there. Stocks are back in the green for 2018!

Full disclosure: I’m just writing like this (exclamation marks, acting happy for the stock market’s recovery etc.). Actually I don’t really feel any emotion when the market moves. If short-term profits were my goal, I’d take riskier positions than tracking a broad index and holding cash, but apparently that’s not the case. Being in it for the long-term makes you immune to market volatility.

For now, I have a salary to fund my lifestyle and a savings rate that can allow me to take losses. And my stock portfolio… I consider it a retirement fund. Or more precisely: an early retirement fund – I wouldn’t sell a share until I stop working.

November Savings Rate

As I said in the October’s financial update – I don’t track my spending, just my net worth at the end of each month. This month, based on gut feeling, I’d estimate the savings around 40% due to the few trips we took.

I really feel that this section of the Financial Updates is redundant, so I’ll stop including it. In the first section of the posts I’m talking about my expenses in more detail, so that should be sufficient.

November FIRE Progress

My FIRE progress, although with a smaller rate than the previous month, has increased from 26,83% to 27,75%. I was amazed, it really felt like we’re wasting a lot of money this month.

Summary

Asset allocation (cash / crypo / stocks): 56% / 4% / 40%

Savings rate: around 40%

FIRE progress: 27,75%

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