Part 83

Hello and welcome back to Mortgage Advisor on FIRE.  This week I look at the concept of survivorship bias and how it relates to investing.  Also, the usual financial updates and a few pictures from Bob’s first full week as part of our family. So let’s get to the Quote of the Week:

Quote of the Week

My quote this week comes from Darren Scothern’s blog, where this week he talks about survivorship bias.  This is such an important concept for daily life that a lot of people overlook, and I firmly believe that this lack of understanding contributes to the negative self-image that many people have.  Look at the quote below:

At first glance, it appears inspirational but I really don’t like this quote.  So much of daily life depends on chance.  There are people who work hard all their lives but never catch a break.  Then, there are people who happen to stumble on the right situation, at the right time.  There is an argument that you make your own luck, and there is some validity to this point.  The more you work at something, the more opportunities you have to succeed.  So, from that point of view you are making more chances for fortune to smile on you.  

So, what is survivorship bias? It’s a cognitive bias where people remember successful instances of an event whilst forgetting, or ignoring, the unsuccessful instances.  Derren Brown conducted a fascinating study to demonstrate survivorship bias using horse racing.  In his study, he recruited someone to place bets on a series of races under the guise of a “system” he claimed to have devised.  The TV cameras documented this person’s progress as they won each successive bet until they had amassed a nice pot of cash.  So, what was the system?

Derren Brown had actually recruited lots of people and he gave each of them a different prediction for the winner of each race.  If you have enough people, then it’s mathematically possible to formulate a different set of predictions so that at least one person is guaranteed to win each bet in a series of bets.  From the perspective of that one person, it appears that the system is magical.  From the perspective of the dozens of other recruits, it’s a failure.  However, until the documentary revealed the secret, many people would have thought the system worked.

Survivorship bias is relevant to many aspects of daily life and a lack of understanding can be dangerous.  I’m extremely critical of many “property experts” who claim they can teach you how to make serious money out of property in a matter of weeks.  These experts normally draw on their own personal experience and describe how they went from a boring office job to owning a million pound property portfolio in just a few months using other people’s money.  What they conveniently fail to tell you, or fail to really emphasise, is that the vast majority of people who try their hand at property investing will not follow that same successful path.  Some people will make a decent return.  Some may do quite well for themselves and transition from their previous job into property over time.  The thing is, some people will crash and burn, and some people could very well lose their lives because of this, just like Danny Butcher, a former soldier who took his own life after losing thousands of pounds trying to build a property business.  

The self-help industry is also something I’m critical of.  There are countless books out there written by people who gave up their job and relationship to go travelling and “find themselves”.  I find a lot of these types of books to be dangerous bullshit.  Some people will go travelling and have a great experience.  They will find inner peace and grow as a person.  I’m not doubting that.  Some people will do this and be better for it.  However, if you are going to write about your experiences, you have a responsibility to your readers to acknowledge that luck played a huge part in your experience.  For example, you could choose to go travelling in India and get mugged and beaten on your first day.  Or, you could travel around Thailand, spending all your savings on flights and spending money only to realise that you are still depressed at the end of it but now you have no job, no savings and you’ve left your partner as well.  For every person who succeeds with this, there are going to be many others who don’t, but those stories don’t sell books.

Weekly Update

Last week I briefly mentioned that we were adopting a cat called Bob, also known as; Bobbles, Bobbity, Bobbers, and Sir Robert.  He’s a sweet cat and he’s very nervous and easily scared.  For the first few days he barely came out of hiding.  He is slowly coming out of his shell though.  Although I like him (I like all animals), I don’t yet feel a connection with him like I had with Sweep.  Part of me thinks we might have gone for a new cat too soon, but my girlfriend really wanted to adopt another cat.  I’m not saying I was forced into it; it was a joint decision.  I was a little hesitant though and once we had Bob here, it brought back memories of Sweep.  

In the last day or two I’ve felt a bit more attached to Bob because I’ve made more of an effort to play with him.  He loves chasing after his toys and I brought back a laser pointer which he goes crazy trying to catch.  I hope he settles in our home and I hope I grow to love him as much as I loved Sweep.

Although more and more people are getting vaccinated, I still feel that the UK is opening up too quickly.  I get that businesses need to survive but how does one balance lives against the economy? Every aspect of the government’s response has been utterly incompetent.  The NHS workers have performed miracles during this pandemic and the vaccine rollout has been a great success.  We wouldn’t have needed such an urgent program had the initial response to the pandemic been even just barely competent.  This government has blood on its hands and, although I don’t think it’s likely, I would hope there are prosecutions for the farcical way the government has handled this crisis.  

My mental health is still not in a great place.  I need to get back to the gym, but I’m still having a few aches and pains.  I’m off work for a week soon, and I think I’ll use that time to gently test the waters and see what my body can cope with.  I’d rather try this when the gym is a bit quieter in the middle of the day rather than in the evening when it’s busier.  

2021 Goals – to be achieved by 31/12/2021

1 – Reduce weight to 92.8kg.  (Current weight 120.5kg).

2 – Finish 104 new books. (Current total: 43).

3 – Complete RO3 for my DipFA. (In progress).

4 – Complete RO4 for my DipFA.  (Not started).

5 – Complete RO5 for my DipFA.  (Not started).

6 – Complete RO6 for my DipFA.  (Not started). 

I have still not resumed studying.  I know I need to, but I lack the mental stamina for it at the moment.  Work is really draining me and it’s normal for me to have less motivation when I’m in a depressed state.  I am enjoying reading for leisure though and I’m up to 43 completed books in 2021, and I’m on track to meet my annual goal of completing 104 new books.

Financial Update


Premium Bonds: £1,500.00 (up £300.00 from last update).

Stocks and Shares ISA: £23,650.42 (up £881.68 from last update).

Fuck It Fund: £300.00 (down £549.42 from last update).

Crypto: £435.00 (down £18.27 from last update).

Pensions: £46,058.40 (up £1,144.57 from last update).

Residential Property Value: £199,355.00 (no change from last update).

Buy-to-Let Property Value: £128,644.00 (no change from last update).

Total Assets: £399,942.82 (up £1,758.56 from last update).


Credit Card: £75.00 (down £974.13 from last update).

Residential Mortgage: £139,949.54 (no change from last update). 

Buy-to-Let Mortgage: £93,121.57 (no change from last update). 

Total Debts: £233,146.11 (down £974.13 from last update).

Total Wealth: £166,796.71 (up £2,732.69 from last update). 

Investment Income in 2021: £1,005.09 (target £5,000).

A few changes this week.  I decided to close down my primary credit card because it was becoming increasingly difficult to service the card.  The only way to make payments was through the app, but it would frequently crash in the middle of making a payment.  Money would leave my bank account and then take days, and multiple phone calls to their customer service to resolve.  There was also the fact that it took a minimum of four minutes each call to choose the option you want because of the barrage of messages telling you that you would be better off using the app.  I’ve started getting increasingly annoyed by this approach from businesses when they spend ages repeating the same message on their phone lines.  I don’t think there are many people that prefer to call companies now.  So, if someone is calling a company it is probably because they can’t do what they need to do via the app or website.  Telling these people that they can use the app or website is just insulting the customer on the phone.  

Anyway, now that I’ve got that off my chest we will return to my financial update.  I had to use some of my Fuck It Fund to pay my credit card off.  However, I felt it was a worthwhile exercise.  I received some dividend income, in addition to my monthly rental income which has pushed my 2021 investment income to just over £1,000.  I may still fall short of the £5,000 target, as I had to use more of my savings to put right a few things with the BTL property.  My crypto balance is still taking a hammering but my stocks and pensions have increased in value substantially.  I was a little bit gutted that I just missed out on my total asset value going above £400,000.  Hopefully I can pass that milestone next week. 

Over the next few weeks I’m going to start looking for my next BTL property.  Unlike my first one, the next BTL will be a solo venture and it will not be as expensive.  The cost of our first BLT ended up spiralling to well over £130,000 once all the repair work was factored in.  It was a learning experience though and there are a lot of lessons I can take forward to the next property.

Please show your support

I spend several hours each week writing this blog and make it freely available to all readers.  I do not hide my content behind a paywall.  However, maintaining a website incurs costs.  If you can afford a small donation, it would be gratefully accepted.  Click on the Buy Me A Coffee image to be taken to my supporter page.  You can either make a one off donation, or sign up to a monthly subscription.  If you can’t make a donation, please share my blog on your social media.

My Instagram is @david_scothern and my Twitter is @advisoronfire. You can also email me at

You can still see Sweep’s Instagram @sweep_the_kelham_island_cat.  

Finally, have a look at Darren Scothern’s fantastic blog at


One thought on “Part 83

  1. Hear you on the survivorship bias – you only ever really read about the few exceptional winners (see also people who have profited from bitcoin and meme stocks) but see very little about the many who have lost money, who might actually be too embarrassed or ashamed to tell anyone.

    And luck is so understated or not mentioned by those who are successful. I’ve had my fair share of both good and bad luck, mostly the former as I think some of it is to do with mindset.

    ‘Think lucky, be lucky’, was what a friend told me once, by which she meant going for opportunities with a positive attitude.


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