2018 Quarter 3 Review, Readying for FIRE

Latchi, Cyprus at dusk

With my work notice period now nearing completion I’m actually a little surprised at the calm in the RIT household.  Hopefully this means we believe we are reasonably well prepared and probably more importantly means that we still believe we are doing the right thing.

At work we’re just completing 2019 plans and I’m not excited by any of it which is a new feeling for me.  I’ve put this down to a couple of things.  One of the main objectives is something I’ve personally done on a larger scale twice previously so I would expect few challenges if I was leading the activity.  This might be a contributor but I suspect the real reason is that FIRE now just feels 100% like the right next step combined with feeling well prepared for what we’re walking into.  Not even Mr Market taking £72,000 from my wealth since its peak in mid-August and £58,000 in the last 3 weeks has made my think twice.  I guess that means I’m ready.

Our readiness for our Med move is also calmly progressing.  We have the removal company booked with them moving us in 2 stages for only an additional 5% cost.  This was our suggestion and I was surprised at the small delta cost meaning it was the lowest total move cost option we came up with.  The rationale is that the shipping time to Cyprus is about 4 weeks so what we’ll do is split our stuff in half meaning we’ll be able to stay in our current UK rental flat right up until the night before our flight and then in Cyprus we’ll only book a short term rental for 2 weeks which should be time enough to find a long term rental.

On the financial side we’ve also taken some precautions like opening additional current accounts with new banks as that will be almost impossible to do once we’re non-resident and banks have form of closing non-resident accounts when they decide it’s best for them.  For example Barclays has form with residents of Cyprus being specifically targeted for closures.  We’ve also opened up new UK savings accounts for a fresh 12 months bonus interest by which time we should hopefully be putting those cash funds to work on a home purchase.  The best I came up with here was the new Goldman Sachs Marcus account which is giving me 1.5% annualised.

We’re also starting to think about what we’re going to need to purchase in Cyprus for our new lives and making sure we can get access to that cash quickly.  We’ve therefore opened up a competitive international currency transfer account as well.  One of the things I’ve decided I’ll ‘need’ very early on is a new road bike.  Requirements are a relatively good price vs weight bang for buck, suitable for plenty of miles in the saddle, suitable for hill/mountain ascending/descending plus the flats and good enough that when I get dropped on club rides it’s because I’m a ‘fat unfit b*stard’ not because I’m riding something that weights 30kg.  The best I’ve come up with is this:

Click to enlarge, Canyon Endurace CF SL Disc 7.0

Do any readers have any better road bike ideas?

With the move now just weeks away this makes this quarterly update the last that shows how I’ve accumulated my wealth.  The next update will switch to how I’m managing drawdown.  Accumulated wealth is quite a loose term in this case given since the start of the year my wealth has actually reduced by £14,000 or -1.1%.  Let’s look at the details.

The Wealthsimple Experiment

It’s no secret that Personal Finance is a hobby of mine (498 blog posts help reinforce that) and within that hobby I’ve done a reasonable job of DIY investing myself to FIRE using the knowledge I’ve gained to focus on a few mechanical principles.  I would suggest that this has also been helped by having a “head vs heart” approach to life, a reasonable grasp of maths, gaining a sense of achievement by reading personal finance books/blogs and an enjoyment of spreadsheets.

Mrs RIT on the other hand is the very opposite of me which makes our non-financial relationship great as we balance each other well.  She would never take on personal finance as a hobby, is more “heart vs head”, is more arts than maths and most definitely doesn’t enjoy spreadsheets.  She does however very much see the benefits of wealth creation and FIRE having been a willing participant in the journey to FIRE.

With this in mind, over a reasonable period now, I’ve been teaching Mrs RIT DIY investing.  The reason I’m not just doing this 100% for her is that someday there is of course a risk that I won’t be able to for a number of reasons.  We therefore want her to be able to stand on her own investment feet.  We are making progress but I’m still answering plenty of questions.  Then a couple of weeks ago it went a little pear shaped.  Mrs RIT was about to buy an investment with some new money.  The night before we agreed what the ETF purchase should be to move her current asset allocation closer to plan and she was to then buy the ETF the next morning.  That afternoon I asked how the purchase went and would she like me to answer any questions.  The response was “Oh I didn’t buy the one we agreed because when I logged on to buy I saw that it had been going down so I bought this other one which has been going up”.  This started me thinking about whether DIY investing is for her and what other options we might have as a risk mitigation to me being unable to help with her (and maybe inherited from me) investments in the future.