Category: Emergency fund

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2023 Goals Review And 16 Months Progress Report

It is the end of April 2024 as I write this – so a review of my 2023 goals is long overdue. Apologies, my friends!

My word in 2023 was Adventure. I wanted to discover new experiences and activities as I prepare for retirement.

Well … there were two new big experiences in 2023.

1. Working a second job or as the young ones call it, a side hustle

2. Having Mum who has dementia in respite care at 2 different aged care facilities

There were also 2 overseas holidays in there somewhere …

1. Working from home

Working a side hustle from home is wonderful. I finally get to experience what working from home feels like and … I love it!

As a healthcare worker through the pandemic, I still went into work every day so I never got to experience the highs and lows of working from home that the majority of workers experienced.

But it is time consuming. I work one full day plus before and after my main job which doesn’t leave me much time to do anything else. There are upcoming changes – I’ll keep you posted when they eventuate later in the year.

2. Mum in aged care

Having Mum in respite care twice in aged care facilities was an adventure I wouldn’t wish on anyone. The emotional toll was horrendous. Watching her not coping in the facilities was very difficult. It will not get any easier as her dementia progresses and Dad needs time off from being her primary carer.

All right, let’s recap on what my goals were in 2023. I had 4 financial and 4 non financial goals. How did I go?

 

Goal 1 - Invest $30k in my shares portfolio

This goal was not accomplished because of Goal 4!

A reminder – my shares portfolio is what I will use to fund the 5 years of living expenses when I retire at 55 as I can’t access my superannuation (retirement account) until aged 60. 

My financial adviser, Deline assured me that I was on track to retire at 55 (HOORAY!!!) and that I could STOP investing in my shares portfolio. At this stage, the balance was not where I wanted it to be but I had to trust the math.

On a side note, the balance as at the end of April 2024 has exceeded that figure in my head – the figure I thought I needed to see before I could stop investing. So I’m very glad I listened to Deline.

I must admit I couldn’t stop cold turkey. I reduced the amount for a couple of months before stopping completely. But when the market was down in October/November, I couldn’t resist and invested some side hustle income.

In the end, I invested about $14k which included cash dividends received.

Goal 2 - Replenish emergency fund

I feel secure having 6 months of living expenses in my Emergency Fund. It was fully fiunded but I raided it to replace major appliances that died in 2021/22.
 
This goal was finally accomplished in May 2023. It’s taken more than a year and accomplishing it felt really good because it was a goal carried forward from 2022.

Goal 3 - Save $5k in home maintenance fund

This goal was accomplished, thanks to my side hustle income.
 

So I decided to aim for $10k.

I always wanted to have $10k in my home maintenance fund but didn’t think I could achieve it in one year so aimed to save $5k instead.
 

Because of this fund, I was able to take advantage of state government rebates and installed an electric heat pump hot water tank.

My original gas hot water tank was 7 years old. I didn’t want it to die in the middle of winter, forcing me to decide quickly to install anything recommended by the plumber. Which was what happened previously.

This is part of my plan to switch to an all electric house ie bye bye gas forever. There is still the central gas heating and stove to go – I’m waiting for more government rebates.
 
By the end of 2023, the Home Maintenance Fund was 90% funded.
 
Since I’ve been regularly contributing to this fund, I haven’t needed to raid my Emergency Fund.

2024 update – the dishwasher’s electronic control panel decided to die out of warranty, of course. So the home maintenance fund came to the rescue again.
 
And in February 2024, the fund is fully funded, YAY!!!

 

 

 

Goal 4 - Engage a fee only financial adviser

Mission accomplished.
 
I didn’t have a good experience at the start of 2018 after I’d pay off my mortgage and was wondering what to do with the ‘excess’ money that would have gone to the mortgage.
 

I had about $10k surplus at the time. I knew I should invest it but didn’t know what to do. No one was interested in talking to me. The guy at the bank said it wasn’t worth my while to engage him.

But thankfully, since then I discovered the FIRE community, educated myself and improved my financial literacy significantly.
 

All the saving and investing I’ve done so far is DIY. So I wanted an expert to cast their eyes over my numbers and tell me categorically if I’m heading in the right direction. I figured there is still time to course correct if I’m not!

I found Deline from Instagram. I had been following her for a while and liked her posts so I felt comfortable reaching out. Knowing that she understood FIRE was also important to me. It saved lots of explaining, haha.

Over the course of a few months and 3 meetings over Zoom, she worked through all my numbers. Based on what I told her I’d like to spend in retirement, she confirmed that I was on the right track. Phew! And could in fact, increase my spending a little. Believe me, hearing that was so comforting!

And as a result of her advice, I started new goals which I’ll detail below.

 

Goal 5 - Declutter

This goal was a massive fail!

I even enrolled in Joshua Becker’s 12 week online course, Uncluttered but didn’t do the work. The timing was unfortunate because the side hustle was starting at the same time. I can access the course at any time but haven’t done so again.

I just work in my cluttered study with towering boxes of stuff around me …

Sigh! I’m thinking this is one of those goals that will be accomplished when I finally retire – surely there’ll be no excuses then!

Goal 6 - Go to bed at 11pm

I would describe this as a semi failed goal. 
 
But I’m not giving up.

I succeed for the most part but get derailed on nights when I don’t have to work the next day.
 
This will be an ongoing goal.

 

Goal 7 - Go outside for 30 minutes every day

This goal can also be described as a semi failed goal.
 
I definitely do not achieve it daily but will try to make up for it on weekends. What having this goal has achieved is to raise my awareness of how little time I spend outdoors. It is much easier to achieve when I’m on holidays and exploring new territory.
 

So once again, this will be an ongoing goal.

 

Goal 8 - Do something new or visit somewhere I've never been before every month

This was definitely much easier when I was on holidays and exploring new places. I found it much harder to do at home though it started off well at the beginning of the year.
 

I visited and joined new libraries. Ok, this may have contributed to the semi failed status of Goal 7. I was able to borrow more books on my Libby app 🙂 And ended up reading 93 books in 2023.

Discovering park runs also contributed to time spent outdoors. I was participating in a 5km park run every week. And even participated in one for 2 weeks in London. But once I came back from my holidays, it was winter and I never went again until March 2024.

 

I visited Sydney, London, Amsterdam and Hong Kong in 2023. There was some work involved in Sydney but overall, I was on holidays.

I certainly enjoyed new experiences in these cities I’ve visited before in the past.

 – pattiserie/cafe crawl and omakase in Sydney
– explored canals in London, West End shows and of course, afternoon teas in various establishments
– visited art galleries, museums in Amsterdam and The Hague; enjoyed learning about windmills in Kinderdijk
– ate my way around and hiked new-to-me trails in Hong Kong. It was also a new experience to win a flight ticket to Hong Kong during their promotion to attract tourists back to the city
 
And now we come to the additional financial goals I set after the consultations with my financial adviser.

 

New goal 1 - Future car fund

I currently drive a work car so will need to purchase a car when I retire. The plan is to buy the car I’m currently driving from my employer.
 
The set amount from my weekly pay that was going to purchase shares was diverted to this fund instead.

It was 74% funded at the end of 2023.
 
2024 update – I am ecstatic to report that it is now 100% funded by the end of April 2024! Vroom vroom!!

 

New goal 2 - 2 years of living expenses cash buffer

The short answer is I did not make a start on this fund in 2023. 
 

At first, my plan was to use the side hustle income to save towards the 3 cash goals – home maintenance fund, future car fund and 2 years of living expenses fund.

In the end, I found it easier to use my side hustle income (which is variable per month) for the home maintenance fund and a regular amount from my main job towards the car. It was driving me insane watching all the funds grow at a snail’s pace.
 

Now that both the smaller funds are fully funded, I will direct everything towards the 2 year living expenses fund. And when this is fully funded, I can retire!

The purpose of this fund is to ensure I have cash on hand in case the market falls which in turn means the value of my share portfolio falls, just when I need to access funds at the beginning of my retirement. I will draw on my cash reserves instead of selling shares in that event.

More progress report …

Annual expenses in 2023

I spent 13% more in 2023 compared to 2022. 
 
The extra expenses were due to general inflation but the main increase was in home maintenance – installing the electric heat pump and fixing the electrical switchboard. I also started having a fortnightly cleaning service from September 2023, fully funded by my side hustle income. My travel expenses were roughly the same as in 2022. Food costs were 1% higher.

My income increased by 25%, thanks to my side hustle.

My savings rate was 42% (based solely on after tax income) which was a small improvement (increased by 3%) compared to 2022.

 

Net worth

My net worth grew by 21% 🙏
 

I have not included my paid off home in this figure. I don’t plan to move and haven’t kept up with the value of similar properties in the area. There is a lot of construction work in my suburb, with old houses replaced by gigantic units.

My net worth therefore consists of the value of superannuation, shares portfolio and cash accounts.
 
There were also 2 exciting milestones reached in the past 16 months.

 

Milestone 1 - $1M invested

My investments totalled $1 million 😮 at the end of 2023!
 
This is purely a combination of my superannuation (retirement account) and the shares portfolio outside of superannuation.
 
It wasn’t something that I was looking out for so it came as a surptise when I calculated my net worth at the end of December 2023 and realised a significant milestone was reached.
 
The predominant feeling I felt was RELIEF. The “end” is truly in sight now.

Milestone 2 - Superannuation balance doubled

My superannuation balance has doubled since 2018, the year I started to pay attention to it. During this period of 6 years, there were only 2 years when I maxed out the contributions.
 
When I reached Coast FI in April 2021, it had increased by 1.5 times. Since reaching Coast FI, I reduced my salary sacrificing drastically and relied mainly on mandatory employer contributions.

I cannot access my superannuation until 2031, when I turn 60 and no longer working. That’s 7 years away. Dare I hope that the market will be kind and another doubling occurs? I’ll update you on the progress 🙂

 

Final Thoughts

Until I sat down to write this post, I had no idea of how much was achieved in 2023!
 

Financial goals are being ticked off and milestones reached that I wasn’t even paying attention to.

And having only one more financial goal to aim for before I can quit work is doable even though the amount I need is quite high. But I still have two and a half years to go.
 
I did not factor in the time required for my side hustle in 2023. I am faster at the work now but the workload has also increased in 2024. But I am most grateful for the income it’s bringing in and the financial goals I’ve been able to tick off, purely because of the extra income. So I’m not complaining.
 

Overall, while my non financial goals were only semi successful, I’m happy to continue trying – I was aiming to enjoy the process and not focus on outcomes so much.

There you are – that’s my 2023 done and dusted. Follow me on Instagram or Facebook if you would like more regular updates or progress reports.

What will the rest of 2024 bring, I wonder?

 

Is it too late to ask ... how was your 2023?

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2019 – a year in reflection

I always think nothing much happens in my life.

Work, home and work some more.

I am also not one to set goals or track achievements – I would say I am a drifter though life, more than anything else. And I am contented and satisfied easily so I don’t push through to the next level.

But all that changed in 2019.

I discovered the FIRE movement in mid 2018 – the best thing I learned though wasn’t how to be frugal (that is important too) but to live an intentional life. After all, what is the point of saving and investing if we don’t know what it is all for?

So in January 2019, for the first time in my life I set some goals. I admit I did not do a very good job at tracking them through the year. But strangely, the fact that I made the effort to set some goals was enough to get the ball rolling.

To help me with thinking through all of this, I completed Montana Money Adventure’s Live with Intention series. In particular, answering the following 3 questions gave me clarity – What do you want to BE? What do you want to HAVE? and What do you want to DO? 

To recap, my overarching goals were to stop drifting through life and live with intention and purpose. I wanted to live a life that reflects a healthier me, mentally, physically and financially.

I was very stressed at the time, working in a demanding job with long hours. The priority was to find time each day and week to think and reflect.

So, this is my 2019 – a year in reflection.

I quit my stressful job

Spoiler alert – quitting my stressful job was the single, hands down, most significant ‘event’ in my life in 2019. And the most emotional as I felt I was letting everyone else down. But in the end, I had to choose me over everyone else.

It has been six months since I began another role with the same employer but at another site. This has singularly reduced the stress levels in my life. I am very proud that I finally took action here.

The transition took me longer than I expected. From having no time at all to having time is quite an adjustment. I was conscious of not squandering all this newly acquired free time but was equally conscious of not filling it all up with frenetic activities.

It is a work in progress – this knowing what to do with my time. I look forward to exploring this more in 2020.

I travelled and connected with family and friends

 

Travel is very important to me. It is a time where I am free to be me totally and indulge in what I enjoy most – eating good food, exploring the art and culture of a new environment. But if I am honest, travel has always been an escape from my job, a time where it is difficult for work to contact me. 

Travelling also allows me to reconnect with family and friends overseas. In 2019, this is what I focused on in my travels.

I attended the 60th anniversary of my high school in my hometown and went down memory lane with old school friends. I reconnected via WhatsApp with old boarding school mates whom I hadn’t seen for decades. Precious memories were made with my little niece on her home turf in London. Catching up with elderly relatives in South East Asia was poignant, making me realise that our time on Earth with loved ones is limited, that one day they will not be in our lives anymore.

Amongst visiting old haunts and familiar cities and towns, I managed to squeeze in visiting Prague and Budapest for the first time. I always feel fully alive when I am travelling, particularly to new places.  

Fisherman’s Bastion in Budapest at sunset

I started a veggie garden

In May, I bought a raised wicking garden bed (basically a self watering garden bed) and planted vegetables for the first time. I have always wanted a vegetable garden but ruled it out in the past as there were not any sunny spots in my garden.

When I mentioned it to my friend, she thought outside the square and suggested the front of my unit, which does get some sun exposure. And that is exactly where I situated the raised garden beds. It just goes to show that when we are open to ideas, even wacky ones such as a vegetable garden in FRONT of your house …

Through winter and spring, I harvested snow peas, lettuce, boy choy, carrots, beetroot, broccolini and cauliflower. And in summer, I planted zucchini, cucumber, eggplant, beans, tomatoes and more bok choy.

Besides quitting the stressful job, having this vegetable garden has contributed the most to my mental health. There is just something very satisfying about planting a seedling and watching it grow, then eating the fruit of your labours. The wicking bed made it easier in that I only need to replenish the water reservoir every 7 to 10 days during winter and every 4 to 5 days during summer. So really, the work has been minimal.

Summer vegetables in wicking bed

I fully funded my emergency fund

One of the first things I started doing when I first discovered the Barefoot Investor in 2018 was to build my emergency fund. In November 2018, I raided it to pay up front for solar panels installation. The government rebate (for nearly half the amount) did not arrive until April 2019.

As travelling is important to me, I have always had a Travel Fund and contribute to it weekly no matter what. I may adjust the amount up if travel is imminent or dial it down if there are more urgent priorities. But I always contribute, even if it’s $10 a week. As a consequence, my travel fund was very healthy, compared to my emergency fund.

The most adult thing I did this year was to swap my travel fund to my emergency fund ie I renamed my travel fund. I was getting a bit impatient that it was taking so long to fund 6 months of living expenses. So finally in October, I fully funded the emergency fund. The feeling of security and achievement is indescribable. I feel such a sense of relief that I can readily access this fund should anything untoward happens.

I contributed the maximum to my superannuation

In the financial year from July 2018 to June 2019, I salary sacrificed and contributed the maximum of $25000 (including employer contributions) into my superannuation (retirement account).

Since transitioning to my new role in July 2019, my pay has decreased as I no longer work so many overtime hours. This means that employer contribution to my superannuation has decreased. And if I want to achieve the maximum contribution, I therefore have to contribute more myself. It forced me to reassess whether I could afford to continue salary sacrificing.

My conclusion is that I cannot afford to stop contributing the maximum at the moment. So my take home pay has shrunk significantly as a result. I will reassess this contribution annually as I also need funds to contribute to my investments outside of super.

Savings rate

I started tracking my expenses in March 2018. So 2019 was the first full calendar year that I have been able to calculate an annual savings rate. Because I am lazy and really not a spreadsheet nerd, it is easier for me to calculate my savings rate based on my take home pay instead of gross income. (Knowing at the back of my mind that I have contributed the maximum to my superannuation)

I was aiming for a 50% savings rate but fell short at 40%. I am not too unhappy about this result, seeing that my take home pay is significantly reduced for the second 6 months of the year.

Net worth

Amazingly, my net worth increased by more than my gross annual wage, mainly due to the stellar performance of the stock market.  Investment within superannuation performed very well – not including the $25000 contribution, the return was 20%. My share portfolio outside of superannuation also grew by 19%.

The challenge is to continue to grow these investments in 2020 and beyond.

I now have a solid plan to retire at 55

What started me on the FI path was the realisation that I did not have enough to retire at the traditional age of 65. As I explained here, I now have a 3 phase plan to retire at 55, provided the stock market cooperates and nothing drastic happens in my life.

Having this plan in place gives me security and focus – I can see the light at the end of the tunnel. I just need to maintain my contributions steadfastly and fingers crossed, the stock market will do the rest.

What I didn’t do so well …

While I started the year off with an exercise regime, it soon fell to the wayside after I completed the Run for the Kids race in April. I gave myself some time off and never got back to running again for the rest of the year.

I started walking after work with my friend which was great but there were lots of times when work and family commitments interrupted our rhythm and we went off course.

Then I had a minor health scare after returning from my travels – my cholesterol was high and my liver enzymes were through the roof. I was given 3 months to ‘do something about it’ so this spurred me to get back to a healthy eating regime and walk daily.

Happily, my levels decreased significantly at the next blood test and I am given a reprieve from commencing medication. But I have to maintain a healthy diet and exercise more regularly from now on. This is a major challenge in 2020.

Final thoughts

I made huge improvements to my mental and financial health but did not do so well on my physical health.

My goal of creating time to think and reflect was met partly by my quitting the stressful job – my mental health has improved drastically as a result.

Financially, 2019 was about tracking expenses and getting some annual metrics so I can compare in later years. The increase in net worth was just a really great bonus.

How was your 2019? I would love to hear your wins and trials – please share in the comments below 

 

 

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