Dad on FIRE

Person on phone: Of course sir, and what day would you like the direct debit to be set up for? Me: Errrrrr............not really fussed, maybe the 1st? Is this a common question you've had asked to you? If you're not living hand to mouth then it shouldn't make much difference what day a payment leaves your bank account right? Right?? Wrong! If you're like me and follow the "pay yourself first" approach, then you have set up a regular direct debit into a Stocks and Shares ISA. But what day of the month is the best to plonk your money into the market? I've grabbed daily data from 4 major stock market indexes since 1984, and analysed the average for each day of the month over that period. Here are the results: Assessment: It is no surprise that the 1st of the month is the day that has the consistently best returns (0.1958% to be precise) The 20th is consistently the worst performing day Looking at the chart, the best day to put mon...

Psst. D'ya wanna double your money? Ok, how about tripling it? Triple and a half?! Final offer! Sounds too good to be true right? Well depending on your tax band and your employer contribution to your pension scheme this is effectively what is on offer. Access the spreadsheet here: https://docs.google.com/spreadsheets/d/1UXYHzVNM2wrynmsJzAIcr9rlQcHShAgWSLy7cS6I3wU/edit?usp=sharing As with all my spreadsheets, you only need to fill out the cells in  bright yellow . In the case of this one, there are only 3 cells to fill in. Example 1: Take the UK median wage of roughly £25k (mean wage is much higher due to sky high wages skewing it!) Employer contribution of 5% Employee contribution of 6% If done via salary sacrifice, then the benefit to the employee is 224% If they have a student loan then this rises to 273% Example 2: Income of £60k Employer and Employer contribution same as above (5% and 6% respectively) If done via salary sacrifice, then the benefi...

Moneyfarm is an online investment platform that allows you to invest in Stock & Shares ISAs and General Investment accounts. Most platforms will charge you a set percentage for managing your money, ranging from 0.15% (Vanguard) up to a couple of percentage points.  Up until a recently Moneyfarm offered the first £12k of your portfolio fee free! However, I received an email the other week outlining fee changes to my Moneyfarm S&S ISA. I do not have the majority of my portfolio in Moneyfarm, however I do "play the game" and have just under £12k in there (all fee free!) Given this news, if you have smaller amounts within Moneyfarm and have previously qualified for this "fee free amount", then you may want assess alternatives and switch to another provider. Admittedly, they have lowered the cost of a lot of the higher brackets, but definitely for the lower amounts it may be worth considering, especially if you are on the "fee free" offer. For me,...

Here I will be posting my stats for the last quarter, developments that have occurred in the past 3 months, my current net worth and how this impacts my earliest FIRE age. FIRE Q4 2019: Current Net Worth: £360,038 Change from last Quarter: +£10,348 Earliest Age I can FIRE: 49 My S&S ISA pots (including the 2 JISAs) and pension have performed extremely well for the year, roughly up about 25% (on growth not contributions). I have switched my Student Loan payment to Direct Debit, this will run until November 2020 when it will be paid off! The only outstanding debt I have is my mortgage, just under £55k. This is in a fix until 2022 although only costing me £300 a month. I have made the maximum 10% over payments already this year. Major changes at work mean I expect to receive a sizable lump sum in Q2 2020, consisting of the following: Considerable retention payment due to TUPE transfer Tax free share payout on my SIP scheme Bonus Free shares Share divid...

Like most FIRE people, I'm a bit of an Excel geek. I work extensively with the platform and I also track my finances every month on it. I've designed a spreadsheet which lets you understand when you can FIRE. As you will not be able to take a private pension until aged 57, if you decide to retire before this date you will need a "bridge" account. I recommend a S&S ISA on a platform like Vanguard, but obviously do your own research on what works for you. You can access it on GoogleSheets here How to use: The only cells you need to alter are in bright yellow, you can then play around with the fire date to see how much more you need in your "bridge" account. 1. En ter you year of birth in cell G1 2. Enter the expected growth in cell G2 (rule of thumb historically is 7% 3. Enter how much money you will need to live off during your "bridge" period in cell G6. This is between when you FIRE and when you ca...

Key to understanding what you can save, is what your budget is. You can do your budget in a number of ways, from using software/apps, to writing them down manually in a Spreadsheet. Apps like "MoneyDashboard" are great but they only give a very limited breakdown, for example your current account. What about other savings accounts, your mortgage, or pensions, any other salary sacrifice schemes you're in? If you're a visual kind of person like me, it is much better to create a visualisation of how much money you have coming in, and where it ends up. Below I have used a "Sankey" chart which shows me weighted columns of where each pot ends up. Build your own here:  http://sankeymatic.com/build/ My current budget Wage - I am lucky to have a very generous wage for the area of the country I live in Mortgage - My mortgage is low (thanks to overpaying at least 10% every year for the past 8 years!) Childcare - The biggest expenditure is Ch...