Hello and welcome back to Mortgage Advisor on FIRE. Some thoughts on pensions, wills, and a disappointing time at Peddler Market.
Weekly Update
I don’t know where the week has gone. Normally through the week I’ll make brief notes for what to talk about at the weekend, but there’s not a huge amount going on at the moment. I have a cold, and I’m trying to sort out an issue with the company that’s due to fit our new kitchen.
Last weekend we had an electrician who subcontracts for the kitchen company come to our apartment to check out the job and give us a quote. He was an asshole. He was rude and hostile. The way he spoke to us and looked at us was, frankly, bizarre. This was our final straw for dealing with this kitchen company. Since we first enquired about getting them to supply and install a new kitchen, we’ve had some doubts. They’ve not been great at communicating, and several promises they’ve made have not materialised. We had paid a deposit of £800 which we were verbally told would be refundable until the work starts. So, imagine our surprise when we called them to cancel the job and get our deposit back when we were told this was not possible.
We were very close to cancelling anyway but then we’d have the stress of finding another company from scratch. So, we’ll proceed for now as it’s the path of least resistance.
Over the last few weeks I’ve been feeling increasingly frustrated at, what I perceive, to be a lack of real progress on my FIRE journey. I feel as though I should be further along. I know, rationally, that I’m doing quite well. Granted, I’m not going to achieve FIRE by the end of 2023 which was my initial goal when I started in 2019. However, I’m in a much better financial position than I would have been had I not started this project. What I really need is to get another BTL property on the books because then it will start to snowball when property prices start increasing again.
On Saturday we went to Peddler Market, an event that runs each month with street food and live music. The food this time was very disappointing, and probably the worst we’ve had in all the years we’ve attended. We saw one vendor, The Spicy Biker, and the menu seemed interesting so we ordered a chicken curry and a portion of onion bhajis. They told us it would take around twenty minutes. We thought it was strange for street food, but figured they were just a little busier than expected. The food ended up taking over forty minutes; arguably a long time to wait even in a restaurant but when you’re talking street food it’s an age. If you can’t serve your street food more quickly then something is wrong with your process. To add insult to injury the food was poor. The curry was inedible, but the bhaji was decent. £20 for what we had was not good value for money.
We tried another vendor that was serving satay chicken but we both took one mouthful and spat it back out. The flavour and texture was just strange. I had some fries from a different vendor that were decent but on the whole it was not a successful evening.
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2023 Goals
Click here to see my 2023 progress (opens a new tab).
What Am I Doing?
TV: Three-Body (YouTube)
Audiobook: Sea of Tranquility by Emily St. John Mandel; The Burning Land: Last Kingdom Book 5 by Bernard Cornwell.
I love Emily St. John Mandel’s books. I started with Station Eleven, then The Glass Hotel, and now Sea of Tranquility. I love the threads that weave through these books connecting them in surprising ways. There’s something so atmospheric, and almost melancholy about her writing. I can’t get enough of it.
We only have two episodes of Three-Body season one left. On the whole I’ve enjoyed it. The show has remained quite faithful to the book, but the first half of the season could definitely have been trimmed down. I saw a preview of Netflix’s adaptation which looked expensive but it was telling that most of the cast were western, when the series is based in China with a predominantly Chinese cast. I don’t see how the story can be transplanted to the west without losing its soul, but I guess we’ll see when Netflix release their version.
Financial Update
Assets
Premium Bonds: £38,000.00 (no change).
Stocks and Shares ISA: £69,095.64 (-£876.86).
Fuck It Fund: £100.00 (no change).
Pensions: £58,646.51 (+£536.29).
Residential Property Value: £228,006.00 (no change).
BTL Property Value: £147,133.00 (no change).
Total Assets: £540,981.15 (-£340.57).
Debts
Credit Card: £0.00 (no change).
Loans: £9,800.00 (no change).
Residential Mortgage: £178,674.86 (-£486.94).
BTL Mortgage: £105,001.75 (-£13.99).
Total Debts: £293,476.61 (-£500.93).
Total Wealth: £247,504.54 (+£160.36).
Investment Income in 2023: £458.81 (target £8,500).
No major news or developments this week. Sadly I didn’t win the million-pound prize on the Premium Bonds, but there’s always next month. Once our BTL is tenanted we will probably increase the payments towards that mortgage slightly as a hedge against property values dropping.
The model we want to follow for our BTL investment is the Buy, Rent, Refinance model, whereby the increased equity in the property value can be released to fund the purchase of another BTL. The last couple of years have been difficult for a number of reasons, but we have funds already in place for a second BTL purchase, and it’s just a matter of finding the right property. The major difficulty we have in finding a property is that both my investment partner and I work, more or less, 9-5. Trying to get viewings on properties outside these times is challenging.
Pensions
Although I’ve been paying into pensions for years, it’s only recently that I’ve started paying close attention to my pension accounts. I have a work pension to which my employer makes substantial contributions. I also have a SIPP which I invest a little into each month. A couple of weeks ago I changed the funds my work pension invested in, which should result in a more aggressive investment approach. Pensions are a long-term investment and should not be overlooked when planning for early retirement. I may not be able to get my hands on the money in my pension for some time, but between now and then it has a lot of time to compound.
Have you checked out your workplace pension scheme? Are you getting the most value out of it? Does your employer increase contributions if you also invest more into the scheme? Do you understand what your money is invested in? You should be asking all these questions when it comes to looking at your pensions. If your employer will pay more into your pension to match your own increased investment, you are leaving free money on the table by not taking advantage of that offer. As always, before you make any changes to your investment strategy make sure you understand what you are doing, and that you understand any/all tax implications.
I started tracking my pensions in Week 70 and in that time the value of my pensions have increased from £42,806.15 to £58,646.51.
Our Will
Oana and I finally passed the adult milestone of having our wills drawn up. We used Fogwill and Jones in Sheffield, and their service was great. Their communications were clear and prompt, and the whole process was much easier than I feared it would be. The total cost for our wills was £300, which I think is reasonable.
Having a valid will is so important even when your financial affairs are simple. It’s even more important when, like Oana, you are not on speaking terms with your family. Now she can rest easy knowing that her wishes are clearly laid out in writing.
Disclaimer
The views and opinions in this blog are my own, and do not represent the views or opinions of my employer, nor should they be considered advice.
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