Our Financial Independence Journey: Monthly Update #25 (January 2019)

Monthly update 25

Amigos,

The first month of 2019 is now past us and it is time for a monthly update. 2018 was an eventful year for my wife and I, and there’s no signs of that slowing down with our baby joining our household later this year.

Let’s get going!

Personal life: What happened in January?

In our personal life, we are still on our mini-retirement, but unfortunately we are getting close to the end.

We could easily spend more time on our mini-retirement and don’t necessarily feel the need to go back to work. We have learned a lot from being off work for a couple of months and it has only made me more certain of wanting to achieve financial independence.

We are spending the days in warm countries either reading, bathing, exploring, working out or talking – as in real talking. Deep conversations about life and what the purpose of life is.

Since we are going to be parents later this year, we are quite curious to see how it will impact our lives going forward. I am becoming more certain of the fact that I want to spend more time with my family than at my work and this might mean one or both of us will change career paths this year or the next.

Financials: How are we tracking on our FI goal?

Luckily, in January we started getting salary again since we are using some paid vacation weeks (in Denmark, you have a minimum of five of those each year). This means we are not eating into our savings anymore to be on our mini-retirement which is a great feeling 🙂

In January, we managed to get a savings rate of 28%. With our combined incomes we should be able to do much better, but then we still favor a mini-retirement over an even higher savings rate. I’m sure we’ll be able to increase it once we start living normal lives again 🙂

MoneyMow savings rate over time (%)

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Our combined take-home income was 84,972 DKK (13,073 USD) and we managed to spend 61,548 DKK (9,496 USD) resulting in the 28% savings rate excluding income from the blog.

We obvious spent A LOT of money this month and much more than I am comfortable with. Obviously, being out traveling is very expensive, but we also bought quite a few things for our baby (ouch, it is expensive getting a baby!) that will be there when we return home.

You might have noticed that our combined take-home income has risen a lot, so I’m confident that will increase our ability to save money – and not end up in lifestyle inflation. We do not expect to have these high-paying careers forever, so we are enjoying it as long as it lasts 🙂

Our net worth is back on track after a month with great stock returns! Our total combined net worth is 2,388,183 DKK (367,413 USD), which is the highest ever. Most of our assets are illiquid:

Liquid assets make up 26% of our total assets with a value of 602,426 DKK (92,681 USD).

Illiquid assets make up 74% of our total assets with a value of 1,785,757 DKK (274,732 USD).

Investments in January had a really good month!

Real estate prices remained flat in our area with a slight decrease compared to the previous month. I expect this trend to continue in 2019 as there’s uncertainty regarding real estate taxes and future interest rates.

Pension increased with 7.9% due to a strong stock market.

Stock indexes increased with 7.1% due to the same reason – those are incredible numbers for a single month, but I try not to focus too much on the ups and downs.

Bonds increased with 0.2% – safe and boring.

Crowdlending increased with 1.1% being a good stable investment as always.

Cryptocurrencies continued the 2018 trend and decreased -19.4%. I don’t think this will ever turn positive again.

As you know, we are pursuing three financial independence goals and are tracking quite well:

For the first goal, we are 41.8% (up from 38.1% last month) of the way towards having three years’ expenses in savings.

For the second and third goal, we are 30.0% (up from 28.2% last month) of the way towards reaching our optimistic financial independence goal and 7.7% (up from 7.2% last month) of the way towards reaching traditional financial independence.

Next week, I’ll publish a post where I dive more into each of these three goals and the assumptions behind them.

Blogging: How did income and key metrics develop on MoneyMow?

MoneyMow has had a really great start on 2019 breaking records once again. I’m super humbled by all the people visiting and re-visiting the site every month. It is an amazing motivation to continue writing 🙂

The metrics developed really well:

  • Visitors: Number of visitors were 6,833 and grew with 20% compared to last month
  • Page views: Page views were 17,025 and grew with 13% compared to last month
  • Facebook likes: Facebook likes crossed over 3,000 up from 2,942 last month
  • Twitter followers: Twitter followers are at 970 compared to 931 last month
  • Newsletter growth: The number of people following my newsletter continued rising this month with 15% reaching 255 subscribers

My income on the blog for January was:

  • Affiliate programs: 1,835 DKK (282 USD)
  • Sponsored posts: 0 DKK (0 USD)
  • AdSense: 30 DKK (5 USD)

The total blog income for January was 1,865 DKK (287 USD). This is a decent income from the blog, but I hope to increase it slightly in the future. I have a few ideas for the coming months for this. Right now it’s fair to say that my main motivation for blogging is not the money – it’s probably the worst hourly wage I have ever had, but it’s a lot of fun though 🙂

Favorite posts of the month

My favorite posts of the month were:

  • Route 2 FI wrote a great piece on why it’s so hard to follow your passion and why we keep on making excuses to stay in our 9-5 jobs. The morale is that you might as well try to follow your passion – the worst thing that can happen is that you end up working 9-5 again.
  • Frugasaurus wrote another great post on frugality and autism. I really like getting an insight into how life with autism is – and then the frugal habits are applicable for everyone.
  • European Dividend Blog wrote a post about what he would have done if he were in his twenties. Looking back is a great exercise. You learn what you want to pass on to your kid sand it makes you reflect on what you want to do with the rest of your life.

That’s it for January. Have a great February until we speak again 🙂

Onwards,
Carl

4 comments

4 comments

Jørgen February 11, 2019 - 09:30

Hi Carl,

Take-home income (after tax) of 84,972 DKK for 2 people in their twenties? Well done!

I have a question. How do you calculate the value of real estate in your net worth overview? Market price minus mortgage?

The cost of having children is very much up to you. Many (most) parents are spending a lot because they want to “treat their baby with the best”. It’s an illusion though, because the baby couldn’t care less about the looks of the bed or if the clothes is from H&M or POMPdeLUX. All they need is love and attention. (We’re expecting our 3rd child in June as well :))

Reply
Carl Jensen February 11, 2019 - 21:16

Congratulations on expecting your 3rd child! That’s exciting! You are very right. I have been shocked by how much some parents spend on clothes/toys/equipment for their kids. I am also drawn towards those good bulky purchases from H&M (or borrowing or buying second-hand), so I hope the budget will stay in place.

Yes, our take-home income actually increased quite a bit lately. Our take-home income (after tax) will be more like 76,000 DKK going forward due to a small bonus payment last month.

You are absolutely right. I use the market price minus remaining mortgage. I use http://www.bolighed.dk to assess the market value of our apartment every month. I have found them to be the most accurate for my area compared to what apartments are actually selling for – and they update the data multiple times a month. I also find their forecasts the most realistic (e.g. our apartment is forecast to decrease in value over the next year).

And big congratulations on the success of your blog by the way – you are doing a great job!

Reply
tony February 4, 2019 - 21:43

Hi amigo, excellent report!

It’s impressive that you guys were able to save 28% of your income while being on mini-retirement. It must be a feeling of short-term financial freedom, which I would love to experience!

I like the way you report your net worth, splitting liquid and illiquid assets in two. I haven’t seen it much around and I think it is a good idea, as you can have a reference of how much capital you can quickly cash, in a case of urgent need – excellent.

Keep up the good work Carl, and you guys enjoy the last period of your mini-retirement.

Hasta la vista! 😉

Reply
Carl Jensen February 4, 2019 - 22:40

Hi Tony,

Thanks a lot for the kind words. I’m happy you like the split of liquid and illiquid assets. I believe it is important to understand in terms of knowing what assets you can withdraw from in reitrement and when you can do it (e.g. I cannot access my pension before I’m +70 years old).

Looking forward to following your journey too.

Hasta la vista! 😉

Reply

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