Friday, 23 September 2016

About investments and risks

- Diversify your portfolio by adding independent and opposing sources of return.
- Don’t pick stocks – Asset allocation is more important.
- Historical returns are not exact indicators of future performance. Don't plan your portfolio around it.
- Don’t invest without a plan.
- Don’t forget to invest in your Financial Education. Every investment you make in yourself will pay you dividends for a lifetime.
- Don’t forget to match investment style with personal goals.
- Don’t place excessive trust in “Experts”.
- Beware of low liquidity.
- Beware of excessive conservatism or risk taking. Remember, a ship may be safest sitting in harbor, but that’s not what ships were built for. Similarly, it’s reckless to take a ship out of harbor when the “perfect storm” strikes.
- Short-term results in a one-way market can lead to false conclusions.
- Don’t confuse total return with value added.
- Don’t focus excessively on expenses or taxes.

Saturday, 3 September 2016

One year health plan - month 3

Motto: All the wealth in the world have no worth to you, if you are not healthy.
(Financial freedom wizards manual)

Weight: 85 kg (3 kg more than 30 days before - 85 kg) at 1.80 m (5'9'')
Body fat: 22%  (2% more)

Only 21 days recorded as another method was used in the period 1-10.08.2016

My training is a complete one, on three directions of action:

1. Body
- Yoga techniques (postures, breathing and meditation) 21 sessions
- Freeletics - some kind of high intensity athletic training 9 sessions
- Running - 9 sessions
- Wing Chun Kung Fu minimal training- 21 sessions
- Freerunning / Parkour - no training this month

2. Diet
- A 70% plant based diet (with a twist of 70% alkaline food daily), no chemicals, less sugar, better hydration (300 ml water every 3 hours when possible) - I achieve this 75% of the time, i would say.
- One day a week - 24 hour fasting - did it 4 times in July. I kind of cheated my diet at least 6 times, having sweets or fizzy drinks.

3. Mind
- Mindfulness techniques aka meditation: 21 times
- Memory training techniques: 21 sessions
- Brain boosting supplements - For the first month i tried: Multivitamin,Emperor Ginseng for Him 6000 mg, Ginseng and Ginkgo biloba solution, Omega 3-6-9 300 mg and my herbal remedies (but for the herbal treatments i did it completely only 75% of the time).

Physical training - While I can see improvements in yoga and wing chun, i somehow decreased the intensity of my running and freeletics towards the end of the month, because of all my extra work that needed to be done before my holiday.
Diet - For the same reason, I somehow ignored my dieting plans at the end of the month, but i kept my hydration optimally every day. I would say 65% of the time i ate as planned. I did my weekly fasting, but in two occasions only for 20 hours instead of 24. I added a Chinese mix of Ginseng and Ginkgo to my supplements, and i took out the multivitamin pills, as i did not like their taste (got sick twice because of them, so they are out at the moment). I will introduce bee pollen instead in September.
Mind - The memory techniques done by default, the meditation quality can and must be improved.

Take good care of you, my friends

Friday, 2 September 2016

August 2016 - monthly report

August 2016 - Monthly report
My Overview

Total portfolio: £13016 (+4357)
Debt: £2117 (+187)
Net Worth: £10899 (+4160)

Investments UK: £1627 (-254)
Investments overseas : £1839 1983 (+144)
Cash: £4524 (+4191)
Pension: £4882 (+276)

Total Income: £7821 (+6291)
Passive income: £6313 (80.72%)
Savings rate: Unknown

Side hustle 1 value: £392
Side hustle 2 value: £53650 (+47365)

What a month! I am not believing what is happening and i cannot even think what will be next, as one of my side hustles started to work beyond my greatest expectations. It is a highly individualized business, so no, i cannot share it yet, because i fear competition. Anyway, let's start with the beginning. My portfolio jumped with more than 4K. Debt increased a little, just because i cannot take too much from the profit back as is needed to be reinvested. The net worth is also reflecting the increase, and i want to clear all my debts in the next two months. UK investments decreased slightly, while overseas ones increased, mostly because of the pound drop in the exchange rates. Cash increased with the mentioned 4K, as the cheque came in the 30th of the month. Pensions increase with their monthly contributions. As for my passive income percentage (which in fact is not fully passive, but it is done unrelated to my full time job) is a mighty 80%. Now all that i need is to continue with the secret side hustle and to build a portfolio with a yearly ROI bigger than 5%. If everything will go according to the plan, i am thinking to learn more about real estate and real estate auction. Wish you at least as much luck as mine, even double, if possible.

(I am in holiday now, first 10 days of September, but last month i had some solid 80+ hours work weeks, I am trying hard to not overexert and exhaust myself, because, at the end of the day, the health is important too. That is the disadvantage of an activity where the time allocated is directly influencing the profit, so, at the moment I need to teach myself to not become too obsessed with making money. Imagine that!)

Good night,

Wednesday, 31 August 2016

August - monthly report - coming soon

This was an interesting month, and one of the best financially speaking in the 2016. I am still compiling the data. I will work on the report soon.

Saturday, 27 August 2016

The bad "good" news

...or as I wanted to say, this is my face when the Santander 123 bank account interest dropped from 3% to 1.5%, but it is still the best available if you have more than 20k on it.

Wednesday, 24 August 2016

Financial independence overnight

Let's say that you just won the big prize. You are a normal person, who never had any specialized financial education. What to do next?

1. You still need to pay your tax for the money you won, so it is recommended to find out what you have to pay and pay it.

2. If you have any debts, student loan or mortgage, pay them.

3. You need basic control over your emotional state, in order to understand your comfort zone and your limits. If you buy shares, for example, and the price goes down, will you sell? Or will you buy more? Are you prone to make impulsive decisions? You need safeguards and restraint in order to not spend it all in the next few years? Do you feel tempted if someone come to you with a investment with a 25-75% annual return (this is too god to be true, you know that, right) ?

4. Keep your identity and lifestyle the same if possible, maintain a low profile, and a need to know basis. You can tell to your wife, and your kids, maybe. If word goes by, a lot of people will come to you with real or not so real problems, asking for financial help. It is better to remain anonymous and support the causes that are important for you.

5. Priorities, goals and values. Do you want to live in another country, or countries? Do you want to still keep your work or stop doing it? Do you want to have another career that you always dreamed off, but you did not have the time and the money to follow it? Do you want to spend more time with your family? To travel around the world? To buy another house or car? Your partner have the same priorities like you or you need to compromise?

Keep in mind that 9 out of 10 lottery winners end up broke 5-10 years later.

Tuesday, 23 August 2016

One simple algorithm for early retirement

A. Do you want to retire?

Yes - Go to B                      
No - Stop reading (Some people are lucky enough to to something they like, so you can see the necessity to retire if you have a better alternative. Of course, it is much rewarding to go to your actual work as volunteer knowing that your bank account is big enough so you do not need to work another day of your life if you do not need or want.)

B. When do you want to retire?

At the retirement age, as everybody else I know - Stop reading.
Before the retirement age - If this is your wish, my friend. You need to start saving. And more than that, you need to know how much you need to save, therefore you need to calculate your retirement expenses and to know how to provide your retirement income. Go to C.

C.  What will be the estimate cost when you will retire?

You are rich - Stop reading.
You know why you want to retire and when, now you need to know what your expenses will be and how to cover them -  You need a decent plan on how to generate wealth and passive income (because of ageing), and how to overestimate a bit your needed income (because inflation, global crisis and stuff). Go to D.

D. The plan

Once you are here, you have your plan, and you can divide the years until your retirement to find how much you need to save yearly. Then you need to start saving, record everything, reach the retirement date, retire and make a good book about this. Do not forget to sent me the book. I promise i will read it.