Part 226

Hello and welcome back to Mortgage Advisor on FIRE.  This week I share some thoughts on time and money, and the benefits of the gradual accumulation of wealth.

Weekly Update 

Do you ever go through spells where you fixate on one singer, band, or specific song or album and think it’s the best thing ever, only to eventually get bored of them and move on to something else? Well, today’s blog is brought to you by Spaceman by The Killers.

It shouldn’t be that surprising, considering what I do for a living, that many friends, family, acquaintances, and even strangers, approach me for advice about finance, mortgages, and investing.  I’m always reluctant to give specific advice to people who approach me at random because I know almost nothing about them.  It’s one thing to give a close friend of a decade some guidance about investing, but it’s another thing entirely to give John or Jane advice when they’ve just approached me out of the blue.

Although I’m not comfortable giving specific or personalised advice in those situations, certain rules around money are universal.  I’ve said it before; money is a game, and if you learn the rules you have a much better chance at winning the game.  The great thing about this game is that it’s not zero-sum; to win, you don’t need to beat someone else or win at the expense of someone else.  It’s possible to lift each other up.

I’m going to write about my rules of money in the next few days, so I’m not going to labour the point here, but one thing I want to discuss is the relationship between time and money.  

Let me ask you a question….  

What is your most valuable resource?

To answer this question you need to think about what makes something valuable.  Is it scarcity?  Is it useful? A combination of both?

Many people will immediately think that money is their most valuable resource.  I disagree.  Some people will think about the question in more detail and conclude that logic, critical thinking, or general intelligence are their most valuable resources.  This is a compelling answer, but still not quite right in my opinion.  

The correct answer, in my opinion, is time.  We have a limited amount of time, and we can never really be sure exactly how much of it we have.  Once used, we can’t get it back.  You can learn new things and you can earn more money, but gaining extra time is much more difficult.  This is why I find time-wasting to be one of the rudest things people can do.  I hate being late for things, and I hate it even more when I’m left waiting.  Being kept waiting for an appointment that is running late is bad enough, but what about people who are strung along for weeks because of organisational incompetence?  What about people who are wrongly imprisoned?  That time is never recoverable.

I’ve got another question for you.  When was the last time you did something, and felt like you’d spent that time well?

In life, we have to trade off time against money all the time.  We might not consciously think about it as a trade, but we do it all the time.  If you don’t have time to cook, you order.  One costs more money than the other, but the cost in time is reversed.  You might spend hours replacing an internal door in your house when spending a little bit of money would have saved a lot of time.  (You know who you are, and I’m not going to stop taking the piss).  

This relationship between time and money is the main driving force behind the FIRE movement.  It’s not about money; it’s about time.  The, somewhat, paradoxical nature of our society is that the only way you can acquire time is through money; having enough wealth so that you can exit the daily grind and live life on your own terms.

In many ways, it feels like my life is settling into a new normal.  My mental health is ok, not great, but ok.  I still have intrusive and unpleasant thoughts that are difficult to shake, but I’m better than I was in the latter half of 2023.  We had a little bit of frustrating news in that Oana’s job offer was withdrawn, and so it’s back to the drawing board for her.  

One thing I don’t get about looking for a job now, is that everything is so secretive.  I’m not looking for work but every so often I’ll be contacted by some recruiter who has seen my profile on LinkedIn and it’s the same copy/paste email template sent to me, where the body of the email has a different font to the greeting at the start of the message.  It’s just sloppy.  Then, there are the calls that come from out of the blue.  I remember one from a few years ago that went something like this;

Them: Hi, is that David?

Me: Yes, who are you?

Them: I’m xxxx from xxxx recruitment.  I saw your profile and wanted to see if you’d be interested in a role we are recruiting for.

Me: Who is the employer?

Them: They prefer to be anonymous.

Me: What’s the salary?

Them: That’s confidential.

I mean, seriously, what the shit? It’s like someone approaching you and asking if you want to buy something, but they’re not telling you what is for sale or what the price is.  I’m genuinely interested to know if this approach is successful, and what sort of retention rate the employers get from their new hires.

I did have some fun with a scammer on WhatsApp the other day though.  Once again, I was being offered an opportunity.  The screenshots of the conversation are below:

What Am I Doing?

TV: For All Mankind (Apple TV).

Audiobook: Stolen Focus by Johann Hari.

We are still engrossed by For All Mankind.  I love alt-history, and I love sci-fi, and I love all things space-related.  So, it’s the perfect show for me.  I do wonder how society would have developed had we pushed on with space exploration.  At the height of the Space Race, the NASA budget was approximately 4.5% of the US Federal Budget.  It’s about 0.5% now.  Investing in space exploration is not a waste of money, contrary to what some may believe.  We owe thousands of new products and technologies to the advancements made through space exploration.  Humanity has a natural curiosity, and eventually, we will need to colonize space to ensure the continuation of our species.  I would love to live to see a day when we establish a permanent presence elsewhere in our solar system, but the pessimist in me thinks it will take much longer.  

I gave up on my audiobook from last week, More Money Than God.  It was just a bit dull.  I’m still early on in Stolen Focus but it’s already interesting.  I’ve thought for a while that we are, as a society, operating on an ever-reducing attention span.  So far this book seems to support that theory.  I’m looking forward to seeing where the research goes.    

Financial Update

Assets

Premium Bonds: £13,175.00. 

Stocks and Shares ISA: £61,428.44. 

Fuck It Fund: £6,029.25.

Pensions: £72,738.22. 

Residential Property Value: £228,116.00. 

BTL Property Value: £147,203.00.

Total Assets: £528,689.91. 

Debts

Residential Mortgage: £173,195.63. 

BTL Mortgage: £104,912.43.

Total Debts: £278,108.06. 

Total Wealth: £250,581.85.

Investment Income in 2023: £901.65 (target £10,000).

A few bits of investment income came through this week, and a dividend has been announced for one of the stocks I own, which should pay just over £1,000 in a few months.  

We were supposed to have a viewing on our BTL towards the end of the week but they asked to reschedule it for this coming week.  I’m hoping we’ll get a bit more interest in the coming days.  We need to get the property sold as soon as possible.  

Get Rich Quick
Unless you are very lucky, it just can’t be done.  There are many stories of people who worked hard and hustled their way to riches, but these stories are the exception and an example of survivorship bias.  There are many people who work hard, do all the right things, make all the right choices and still fail.  As Captain Picard once said, “it is possible to commit no mistakes and still lose.  That is not a weakness; that is life.”

The best way to build lasting wealth is step-by-step.  It doesn’t necessarily have to be slow, but it has to be organised, planned, and constant.  Building wealth requires that you have money working for you constantly, even when you are sleeping.  This can be stocks or funds where companies are working to generate profit which increases the value of your investment, or it can be interest in cash savings, or the capital gains that come from property.  

One point that I think is often overlooked is that of earned success.  I can explain with the example of cooking.  There’s a sense of satisfaction that comes from cooking a really good meal from scratch; from starting with a selection of basic ingredients and bringing them together to create something glorious.  You can enjoy a meal at a restaurant, but there’s not that same satisfaction of a job well done.  I believe it’s the same with wealth.  Don’t get me wrong, I’m not going to turn down a big win on the Premium Bonds, but the satisfaction will be different to building my own wealth.

This gradual accumulation of wealth might not be as exciting as the drama of winning big, but you could go years chasing one GRQ scheme after another just to end up older and no wealthier.  Time marches on regardless, so you have to make a choice; chase the dream or chase reality.  

That’s all for this week.  I hope you have a great week ahead, and please remember to like, share, comment, and subscribe.  

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.

If you want personalised financial advice, seek an appropriate professional.  If you are in financial difficulty, seek advice via the resources below:

StepChange

MoneyHelper

Biolink 

You can now find all my social media pages by checking out my Biolink:

bio.link/davidscothern.