2017 Q4 (Oct-Nov-Dec) Financial Update

Hi RIPpers,

I’m back after a long break. I’m back to stay.

First of all I want to thank all of you who sent me a nice email, message, comment. THANK YOU!

I’ve not been posting for a while, not because I lack motivation but because I lack perseverance. Yes, I’m working on it. Plus life has been a little bit complicated lately.

Anyway… welcome back to my quarterly financial update. As usual, the reference doc is my¬†NW spreadsheet. As you may imagine I have a private version of the spreadsheet and I copy relevant data into this public one when it’s time to publish a financial update. I recently finished refactoring the 2018 personal spreadsheet and I changed a lot of things. These changes are not yet reflected into the public one, so expect a huge refactor later this month or before the next update ūüėČ

Quarterly Overview

NW Delta +47.8k EUR (Oct +22.7k, Nov +10.3k, Dec +14.8k). Extremely good! Mr.Market is stil running as a crazy bull despite Dr. USD & CHF enjoying nosedives.

Measured in USD: +70.5k USD (average +23.5k per month).

Measured in CHF, our NW Delta for Q4 is +73.5k CHF (on average +23.8k per month, more than what we bring home!).

Saving Rate 68.5% for the quarter even though we indulged in a 10.5k CHF #antimustachian vacation to Maldives and… well… Christmas is always Christmas.

Yearly Overview

Net Worth delta month by month (in EUR). Note that these deltas may differ from previous monthly updates since I may adjust things backward:

  • January:¬†+8,165¬†(USD dropped a lot)
  • February:¬†+20,933¬†(USD came back)
  • March:¬†+49,016¬†(got married, joined NW with Mrs. RIP)
  • April:¬†+7,091¬†(USD and CHF dropping)
  • May:¬†+7,482¬†(USD in free fall)
  • June:¬†+12,803¬†(main wedding)
  • July:¬†-4,720¬†(both USD and CHF in free fall, otherwise a positive month)
  • August:¬†+13,232¬†(regular month)
  • September:¬†+21,564¬†(that’s what happens when market goes up and currencies don’t make me cry)
  • October:¬†+22,769¬†(same as above)
  • November:¬†+10,305¬†(USD and CHF down again)
  • December:¬†+14,813¬†(a lot of expenses but still an amazing month!)

Total 2017 NW Delta: +183k EUR (+33.24% during 2017), from 552k to 735k.
Measured in CHF: +268k CHF, +45.34%.
Measured in USD: +302k USD, +51.94%.

Total Income in 2017:¬†250k CHF. This is net income, i.e. take home pay. It includes, for both of us, salaries, pension contributions, bonuses, stocks. It includes wedding gifts. It includes dividends and profits for assets that does distribute profits. It doesn’t include reinvested profits or capital gains. How can we track net income? Well, it’s been easy since we were both taxed at source (eventual negative/positive tax returns has been considered extra expense/income). Now that we’re no more taxed at source things are getting more complicated, more on this later.

EDIT: I just realized income in CHF is lower than NW delta in CHF. It means if we hadn’t been working the whole year, our NW would have gone up anyway ūüėģ

Total Expenses in 2017:¬†91k CHF. Ok, breathe. Don’t panic. Ok, panic now Aaaaaaaaaaaaaah holysheeet 90k expenses!! Well, 27k went for the two weddings. Another 10k for an extraordinary-one-of-a-kind trip. Ok, relax now. Yes, it’s been a dangerously expensive year, but seriously, we’re not going to get married again in 2018! What could happen that might impact that much our finances again??

Buying a car, RIP

Go away noob! I’m¬†car-free since August 2008, I’m getting close to the 10 years milestone!¬†Why should I ever need a car?

Moving out of that cheap 50sqm flat, RIP

Hahaha what are you talking about?? We LOVE our cozy, small, ultracheap apartment with no dishwasher, no washing machine, second floor (european floors) without elevator! Why would we ever need to move out??

Cause you will have children, RIP

What? I didn’t hear you… the phone doesn’t… the signal is not clear…

Yeah, we’re waiting for a baby ūüôā

Say hello to BabyRIP ūüėÄ

She’s expected to join the family in May 2018! And no, we’re not buying a car and (for now) not actively looking for a bigger apartment!

We’re sooo not prepared (but excited!) for this ūüôā We just started trying after the honeymoon and… hole in one!

I’m scared as hell, I don’t know how good I will be as a parent, how frugally I will be able to handle the pregnancy, the birth, the parenthood, how far in the future this event will move our FI date… but I’m incredibly happy and I can’t wait to play with her!

Total savings in 2017: 159k CHF. As you can see, even though market performed crazily good this year, most of our NW increase comes from savings! As a friend usually says: choosing to go out once less this month is more important than picking an ETF with a 0.01% TER lower than another.

Saving rate for 2017:¬†63.5%. Last year we achieved¬†68.8%. If we exclude wedding we’d have achieved¬†72.1%¬†this year!

Quarterly Details

Metrics

Income: 76.7k CHF –¬†Expenses: 24.1k CHF – Savings: 52.6k CHF
Saving rate: 68.5%
Saving rate for 2017: 63.5%. Excluding Wedding: 72.1%
Net worth: 735.3k EUR, Delta for the quarter is +47.8k EUR
FI% moved back to 61.27% Рwe changed monthly target and SWR, new FU Number is 1.2M (~100k bigger that previous one).
100% FI Forecast: 36 months left.
FI Date Forecast: December 2020.
Current Allowance: Year 25,735 EUR РMonth 2,145 EUR РDay 71 EUR
Current Withdrawal Rate: Real:¬†10.61% –¬†Ideal:¬†5.71%
Years of Ideal expenses accumulated: Real 9.4 – Ideal 17.5

Metrics don’t look very good. We spent a lot this year and moved the target away. Still 3 years left, assuming same income (but Mrs RIP will not work for a while), same expenses (they may go up or down depending baby impact) and market growth (pretty much unsustainable at this pace).

Major Wins

1) Mr Market skyrocketing!

Every single ETFs we hold (and Hooli stocks too!) skyrocketed. US, Pacific, Emerging Markets… only the Europe, after an amazing October, didn’t perform as good as the rest of the world. Very good! Or very bad, investing now is scary…

2) 2015 Tax Return (5435 CHF) cashed in ūüôā

It was expected, but still pleasurable. I consider it income and I account for it in the month I get the money on my checking account. It’s actual income since hadn’t I overpaid taxed in first place I would have seen this as a take home pay. Remember I measure net income and, oh boy, it’s getting hard to measure with deferred cash flow and taxes.

3) First real dividend received!

I mentioned in one of my last posts (sooo looong ago) that I started investing in Dividend Stocks. Actually a dividend stocks ETF by Vanguard: VHYD.

This fund collects dividends from the owned companies and distributes dividends to shareholders quarterly, so I got my first dividends on December ūüôā It will actually be credited on my InteractiveBrokers account in January (already happened at the time of writing this post).

Dividend amount is¬†263 USD while market value of my VHYD holdings on Dec 31st is¬†47,276 USD (0.55% quarterly dividend, 0.32 USD per share). It’s been the smallest dividend of the year, according to ICTAX. This year yield has been ~3%.

I don’t know if I’ll be able to claim some US tax withhold on these dividends, but I guess I won’t bother for such a small dividend. And the fund is “world” so I have no idea – and don’t want to know – how to claim each county’s tax withhold amount. For US is relatively easy with the DA-1 form but as I said, such a small amount for now. I guess I’ll end up paying income tax in Switzerland on the (already taxed at source in each country) dividends.

I consider this dividend as credit in December 2017 (under “Other”) and income in January 2018.

Expected income tax on dividends is also accounted for (estimated 25%) in January.

I like dividends! I like them even though they’re not Swiss friendly (no capital gain tax here, but dividends are taxed). I like the idea of generating actual income from investments. I like the idea of not having to touch (much of) the principal in retirement. I may increase my exposure to dividends in the near future.

4) Exceeds Expectations

At Hooli, based on Q2 and Q3 performances. Working 80%! That’s an amazing October news that has boosted end of year bonus, salary growth and stocks refresh!

5) Ridiculous December Compensation

December salary, 13th salary, huge stocks vesting (30k USD gross) and (announced, not accounted yet) 24k CHF gross yearly bonus that will be paid in January. Bigger than 15% gross salary target even though I’ve been working 85% on average this year and the bonus is supposed to be prorated. Nice!

Money, money, money everywhere! I know it’s easy to accumulate wealth this way and I’m grateful for that. But it’s even easier to throw money away and inflate your lifestyle.

But RIP, you spent an outrageous amount of money on a trip to Maldives..

Yeah yeah, it’s one off, it’s a babymoon, it’s… ok, we exaggerated, but it didn’t make a dent in our December finances. It’s silly!

6) 2 small bonuses In November

Yes, I’ve been working a little bit harder recently. Anyway, 2 projects launched: 1000 and 1100 CHF as nice recognition along the way ūüôā

7) Reasonable expenses in October and November

The time when a good month was a month below 4k is long gone ūüôĀ

With BabyRip knocking at our door I have no idea how much it could change the satisfaction bar.

Anyway, 4.2k – 4.4k Oct and Nov (78.4% SR in October) is definitely a good news even though we indulged quite a bit in eating out.¬†the 587 CHF restaurants expense in October expense is driven by Mrs RIP parents and brother’s family coming visiting us.

Major Losses

1) My Grandpa died at age 97.

On December 30th, a couple of months after her wife, my highlander Grandpa died ūüôĀ

I’ve been so lucky to reach adult age with all my grand parents alive and in good health, but they’re all gone now.

R.I.P.

2) CHF and (even more) USD nosediving

They keep falling and they almost even out market gains. Currency fluctuations is my main nightmare these days. During 2017 CHF lost 8.3% vs EUR and USD lost 12.3%!

Should I stop measuring my wealth in EUR and switch to CHF?

Problem solved ūüėÄ

3) Expenses a bit out of control in December: 15.4k

Well, Maldives ate 10.5k of this pie, but still ~5k for regular expenses is borderline acceptable.

Ok, pregnancy is kicking in (558 CHF) but what about 500+ CHF for Christmas gifts?

Other financial facts

1) Reviewed Target SWR and FU Money

Truth is: we have no idea what we’re doing. We’re saving money but life is changing so many times we have no idea when we can call it FIRE. We have no idea what our expenses will look like when – and more important, where – we’re gonna be “retired”. We have this vague idea of “maybe we will move back to Italy where 3k EUR per month is luxury”, but Italy is rollercoasting to third world and maybe we don’t want to grow our little princess in such a horrible world. We don’t know.

Here in Switzerland we’ve spent 90k+ this year and we still don’t own a car, we live in a cheap apartment and don’t (so far) have kids. Someone says 100k per year is borderline for a family of 4 here. 100k per year means ~3M CHF FIRE Money… what the faaaaack!

I don’t think we’re going to make better plans or clarify our doubts in 2018, I guess we’ll be in survival mode and keeping up with life (and still hopefully stashing 50%+ of our income).

Maybe 2019/2020 will be the right time to make some final choice about retirement budget and location, unless something extreme happens (job loss, burnout, near death experience, atomic war, Berlusconi wins again in Italy, and so on).

For now, I’m increasing our monthly target expenses from 3000 to 3500 EUR/Month¬†and increasing our target WR from 3.25% to 3.5%. The total effect is an increase of target FU Money from ~1.1M to 1.2M.

I’m increasing monthly target to 3500 EUR because it seems to me that we cannot live with less. I’m probably blinded by Swiss life costs, but I prefer to err on the side of safety here. And in Italy investments are taxed 26% both capital gain and profits. So 3500 withdraw means in the worst case (all profits) ~2600 net which is in line with my estimate of 1000 EUR per adult plus 500 per child. in case we’ll have a second child (we both want it) we need to raise the monthly target again.

Reducing WR to 3.5% after having been scared as hell by ERN (earlyretirementnow) SWR series¬†where BigERN advocates for a 3.25% WR to be almost 100% safe in the very long run (60 years). I’ve convinced myself that some 0.5% of failure risks can and must be tolerated and btw, it’s a known problem how we – early retiree candidates – overestimate the fear of running out of money. There’s absolutely no chance of me not earning a dime in early retirement! And there are expected windfalls (inheritances) and annuities (pensions).

2) No more taxed at source: I got a C permit

It’s the equivalent of the American Green Card: a work permit that doesn’t expire. It’s a “permanent residence” permit. Hurrah, I’m a step closer to become a Swiss Citizen (do I want it??)

The only tangible change is that I’m no more taxed at source, i.e. I get the whole gross salary (minus pension plans contribution, unemployment insurance and other minor “taxes”) and I pay taxes all at once in March the year after.

It’s more complicated than this:

  • You can pay monthly/quarterly/yearly advances. The City and the Canton send you some forecasts of your communal and cantonal due taxes and you can pay them to avoid interests of 0.5% if you pay later (who wants a 0.5% loan? I do!)
  • You can only pay communal and cantonal taxes this way, not federal taxes. Federal taxes must be paid out in March all at once.

Not that hard, isn’t it?

Well, our situation is way more complicated since:

  • I’ve been paying Tax at Source till October. Each salary was taxed on a marginal tax rate depending only on the monthly payslip itself and the tax bracket structure of my situation.
  • My situation changed halfway thru the year since I got married. Married couples pay lower taxes but they need to cumulate the incomes and wealth. It usually means you pay more taxes if your salaries are within a 4x factor. Since I earn more than 4x Mrs RIP (yearly gross) we should save some money.
  • My situation changed in October when I returned working 100%.
  • Mrs RIP employer didn’t adjust her tax at source amount when we got married. And he didn’t interrupt the tax at source when I got the C permit (she should not be taxed at source anymore)
  • My December payslip is huge and it would have been taxed a lot if I were taxed at source.
  • So far I’ve always been postponing tax declaration to September, I have no idea how can they emit a federal tax bill if I hadn’t yet done my tax declaration by March 2018.
  • I’ve done Pension Pillar 2 & Pillar 3 buy ins that will lower my taxes due (communal, cantonal and federal)
  • Last year tax declaration said I should get back 9k CHF so… I don’t want to be long this year too, I’d rather be short and pay the difference.

So… I didn’t pay taxes in November-December and I received the suggested tax advance from city & canton tax office.

I had some headache on trying to estimate how much taxes I expect for 2017 and I’m accounting for them on several rows (expected income taxes due, expected capital taxes due, taxes already paid,…) of my private spreadsheet but in the end I just paid the advance they suggested me. It’s the first year in this situation and the most complicate one with a marriage and permit change mid year.

How long can one postpone this payment? Nice question. So far I’ve been declaring taxes for year X in September on year X+1 and the final bill came in one year later, September/October X+2 (I cashed in October 2017 the final negative bill for 2015). So in theory I can keep 2 years of due communal and cantonal taxes as a permanent 0.5% loan, something like 60k CHF. Forever.

I was tempted to pay ZERO advance and keep the money as a very cheap 0.5% forever loan but:

  • I was scared to challenge Swiss tax authorities
  • I’m not going to leverage on this loan and invest it, I’m actually hoarding some cash.

Did anyone try that? Is it worth?

3) Pension Pillar 2 buy in 12k CHF

As a routine in last 3-4 years, I’m doing voluntary payments to Pension plan that are tax deductible. More on this here. I claimed I’d stop in 2017 but apparently there’s a threshold on some cantons that won’t block your Pillar 2 withdraw and in my canton this threshold is 12k. It’s not yet fully clear, but official sources (citation needed)¬† say that if you withdraw Pillar 2 Pension and in last three years you didn’t do voluntary payments above 12k you’re good to go, i.e. only pay kapitalauszahlungssteuer¬†on the amount withdrawn.

4) I have a bunch of cash at hands

As I said above, I’m hoarding cash. December salary, 13th salary, huge stock vesting and (soon to come in January) yearly bonus.

I’ve been drained recently due to Maldives, Pillar 2 buy in, some ETFs rebalance in November but now (January) I’m sitting on ~90k CHF cash (but 10k expected taxes).

I’m slightly reluctant to¬†invest/rebalance given the amazing latest Mr. Market performances but… gotta stick with it and rebalance in Feb! So far I’ve only made mistakes when derailing from my plan: my choice of selling my US Tech ETF has been a mistake (+12% since October), but I wanted to differentiate.

What about Cryptos? It deserves a post on its own. TL;DR not for now.

5) Financial independence Community

Great news!

Several months ago I’ve been interviewed along with other 10 FIREing / FIREd for the book “Finanzielle Freiheit”, by¬†Gisela Enders¬†and the book came out – in German.

Finally it’s been translated in English!

Here‘s the website for the book:

All the proceeds will be donated to a children’s home in Romania. Robert White, one of the people interviewed, is from Romania and will ensure that the money gets to where it’s needed most!

Hey RIP, but you’ve been interviewed in English and translated to German for the German edition… will your interview be translated back from German in the English edition?

Ehm.. I assume they used my original interview, or else “I guess my chapter will be unreadable, we all know how creepy translations look back and forth!

Wait… I just translated back and forth the previous sentence and it’s fine¬†

That’s not all: I’ve been interviewed by Patrick from healthyhabits.de. Maybe I’ll be featured in another book, looking forward to reading it!

Last: Financial independence Week Europe (FIWE) 2018 has been announced: June 8th to 14th in TimiŇüoara, Romania (same place as FIWE 2017). Apply now! This year I’m attending for sure!

RIP, do you want to go to FIWE? You’ll be one month into fatherhood in June!

That’s exactly why I want to run away from my family. It will be a great pain to detach for few days from my family but… what’s to be done has to be done ūüėÄ

Other Facts

1) Not many trips during this quarter

We’re not used to not travel so much, but the pregnancy is making Mrs RIP lazy so we stayed home most of the weekends, enjoying friends and good weather this fall.

2) … Except I went to Hooliland on October

I like to go to Silicon Valley once a quarter, it’s always funny, inspiring, relaxing and I get to spend some quality time alone too. And it’s hot in winter too!

3) … except we went to Maldives (but it doesn’t count, we went in January!)

The idea to go to Maldives dated back in September/October, i.e. as soon as we discovered we’re waiting for a baby. Someone calls it a babymoon: your last romantic vacation before your life is completely wrecked in parts by a 3kg creature that will destroy your dreams and permanently changes.

Last year we went to Mexico with a couple of VCF (Very Close Friends). Mr VCF has been one of my¬†wedding witnesses and Mrs RIP and Mrs VCF work together. We spend a lot of time together and we consider them part of our expat family in Switzerland ūüôā

If you remember, India & Maldives were among the candidates for last year trip. We gathered together several evenings and started organizing the trip, rating ~100 islands independently each of us, setting a budget (I was the one trying to bring the budget down!), a time frame, some constraints and then… we booked!

We booked very late (something like December 10th) for a trip that took place between Jan 3rd and Jan 14th. Yes, January 2018 is not “Q4 2017”, but I’m not going to write a post about our Maldivian trip alone. And we paid it in December, so I guess this is the best place to mention it.

Here’s a photo gallery, enjoy ūüôā

This slideshow requires JavaScript.

4) Back to 100% at work: a report.

Since October I’m back 100%. I’ve been working 80% (Monday to Thursday) between January and September.

Well, I can’t say I like it. But it’s not been that bad so far. I’ve been busy with a couple of small projects that I liked slightly more (and that brought me bonuses).

I still dream about working less: in one of my ideal near future there’s me getting promoted and switching to 60%, while parenting and coasting to FI.

In the meantime I’m going to enjoy a 75% year (Hooli is veeeery generous with parental leave!) while being paid 100% ūüėČ

5) Reading Recommendations

I’m deeply reading Sapiens¬†and Homo Deus by Yuval Noah Harari.

Sapiens is a life changing book. It challenges your prejudices and makes you connect the dots of human history. It should be how history is taught in every school.

Take a look at his TED talks:

And the amazing TED session with Chris Anderson about the near future!

Life changing, read Sapiens (and Homo Deus)!

2018 Goals & Plans

It’s hard to set goals this year. We’re essentially waiting for this little hurricane to change our lives and see what happens. I prefer to stick with my¬†principles (even though I didn’t read Ray Dalio’s book yet).

Principles are: I’ll keep saving as much as I can, hopefully 50%+ of take home pay.

I’ll keep investing according to my IPS, eventually revisiting it and adjusting a bit.

I’ll aim to reach FI as soon as possible while trying to enjoy the path and recognize the line between frugality and deprivation.

… enough?

Wanna see me committing to anything this year? Naaah. ok, here’s a goal: become Millionaire in one of my three main currencies! USD is the natural candidate. Spoiler alert: at the time of writing NW is up another 40k USD (thanks USD for dropping every f***ing day) and it’s now in the neighborhood of 920k USD.

It seems an easy goal, isn’t it? We may be millionaire before summer, except if:

  • The market crashed significantly this year (likely), but that would be good for newly invested money
  • The USD and the CHF go up against the EUR, but that would mean that our NW in EUR would skyrocket! I’d rather end the year at 999k EUR with EUR:USD:CHF 1:1:1 than become millionaire with monopoly money.

RIP, your kid will rip apart your finances

Nice pun indeed ūüôā

Yes, that’s a concern. What could happen?

  • Mrs RIP not working after pregnancy leave? Net income goes down by 2.5 – 3k per month
  • Move to a bigger house? Expenses go up by 1.5k at least.
  • We need to use uber-expensive Child Care? Expenses go up 2 – 2.5k per month

I hope not all of them happen at the same time. Super frugal scenario 1 out of 3, more realistic scenario 2 out of 3. We’ll see.

Another goal? I will make my apartment in Milan productive again in 2018. Which probably means I’ll sell it.¬†I’ve done some active steps to sell my house in January. I got the apartment evaluated by 2 different Real Estate agencies and value seems to be between 70k and 80k EUR, so the 70k EUR I’m accounting for in my NW is a pretty accurate guess, given that selling will have some costs.

That’s all folks!

4000 words RIP, who do you think you are, Tim Urban??

August-September 2017 Financial Update

Editorial note:¬† financial update will become a quarterly event. I’m covering August and September here to align with quarters. Next edition will be Q4 2017 (Oct-Nov-Dec).¬†

Hi RIP voyeurs,

welcome back to my monthly update. As usual, the reference doc is my NW spreadsheet.

You may find that the doc is out of sync with the screenshots from this post and with the previous ones related to financial updates. Two reasons:

  • I retroactively added pro-rated end-of-year work-related windfalls (13th salary, yearly bonus, huge Hooli stocks vesting event). I’m considering the pro-rated amounts as “credits”, so they figure in my Net Worth under the “All – Other” category.¬†Why? Cause it sucks to see FIRE date forecasts never getting closer! Yes, it’s a matter of keeping myself motivated. Am I cheating? Well, I wouldn’t say so: the windfall events will happen in December/January and there’s almost zero risks of not getting the money.
  • I added few entries in the October column along with a couple of rows for the new Vanguard World Dividend ETF I purchased in October, to keep the investing tab of the spreadsheet working.

I’ll try to keep this update short.¬† [Update: no way I can keep posts short!]

Overview

NW Delta +34,785 EUR (August +13,151, September +21,634). Very good! Saving rate close to 70% on both months and spending below 4k in August and over 6k in September, but that’s due to few exceptional events.

Thanks to two years of expense tracking (so thanks to this blog, else I wouldn’t have¬†bothered tracking my expenses) I discovered a pattern: it seems August and January are our cheapest months, both this year and last year. We prefer to go on vacation during June-July (and eventually September-October) avoiding August which is when regular people go on vacation in Europe. Better deals, less crowded places and August here in Switzerland is just amazing!

Wins for August-September 2017

1) Surprisingly positive 2016 Tax return!

I had my 2016 tax declaration meeting with a “financial advisor” (just a man that’s skilled in filling the tax form) in mid September and, well, apparently I should get back 10,000 CHF!¬†Why? 6.7k CHF Pillar 3 buy-in, plus 20k CHF Pillar 2 buy-in, plus having raised my contribution to Pillar 2 to the maximum allowed by Hooli Pension Plan helped.

We also discovered that I’ve paid much more Quellensteuer (tax at source) during year 2016. 10k CHF more than 2015, while 10k is also my gain in gross income in 2016. Anyway, I’m only accounting for 9,000k CHF credit in my NW since I expect at least an extra 1k tax on my ETFs.

Here’s the thing: capital gain is not taxed in Switzerland, profits/dividends are. Accumulating ETFs are taxed based on a fake dividend date and a fake dividend amount. Two (out of three) of my ETFs didn’t have a fake dividend amount yet for year 2016 and the ictax site says “The taxable earnings could not yet be identified and will be determined later“.

My tax advisor said “well, if they reported no dividends it means you pay no taxes” which is totally false! Please take a look at my ETF 101 post for more information.

I expect (virtual) profits in the range of 3-4k CHF taxed at my highest marginal bracket which is… I have no idea, but somewhere around 25-30% so at least 1k extra taxes.

That’s why I accounted as a 9k CHF credit on my NW. If you click on the image on the right you can see some detail.

2) Confirmed 2015 +5,435 CHF positive tax return.

Double the gain, double the pleasure!

Few days after the 2016 tax return I received two letters for 2015 tax return: the Federal one and Canton/City one.

The Canton/City one confirmed I should get back¬†5,435 CHF and I’m waiting instructions on how to get the money back ūüôā

3) In target spending (August).

A month below 4k CHF is a good month. 500 of which for an indulging relaxing and romantic weekend in Italy. Well done!

4) Awesome markets returns (September).

Mr. Market got a couple of bumps but ended up recovering almost everything by end of August. Euro ETF (where I have 180k EUR invested) closed negative for the third month in a raw. Nothing to worry about. Things can (and one day it will) go south in more spectacular ways.

In fact in September everything was back to normal. Too much. All time high.

Losses of August-September 2017

1) My Grandma died at age 89 in September.

My Grandpa (his husband, still alive at age 97) is not in great shape too. A big personal loss, even though it didn’t come unexpected. I want to look at the bright side of this, having to care for my living Grandparents in last year kind of put the larger family close together, and that’s a good thing. I’m communicating with my cousins and sister on a daily basis and that’s good. Their legacy is here, they have been amazing grandparents.

My only regret is that they couldn’t come at my wedding in June. Anyway, RIP family took a plane on the day of the event and attended the Funeral. That’s the 800 CHF entry for this urgent trip to Rome.

Other financial facts

1) Neutral currency fluctuations.

CHFEUR has been stable over the whole period. At least the CHF stopped losing terrain compared to EUR. Regarding USDEUR, at one point in August, after North Korea playing with bombs over Japan, the USD dropped below acceptability but ended up recovering pretty much everything.

2) Gave up with a 3k EUR family loan.

I loaned money to one of my family member few years ago and I kept accounting those 3k as credits in my NW. Let’s be realistic, I’m not going to get this money back. I’m sure the person who asked me money will do their best to repay the debt but I’m not expecting this to happen.

Even though it’s a financial loss I didn’t put this item in the “loss” section since I consider that a gift. And a gift is not a loss ūüôā I suggest you approach friends&family loans with the same approach, as wonderfully explained by Trent Hamm here.

3) Sold all the shares of my Tech ETF.

Already discussed in last post.

Other Facts

1) Had a relaxing 3 days vacation in Italy.

We used Mrs. RIP’s family car for a while here in Switzerland and we needed to bring it back to Milano and come back to Switzerland with the train. We stayed 3 days in a WWF Oasis in Parco di Montevecchia, close to Como lake. Relaxing, eating healthy, hiking everyday. Wonderful!

2) Two trips to Innsbruck.

Sadly our best friends here in Switzerland (he’s been my wedding witness on both my weddings this year) moved to Austria. We went visiting them twice in September. First time as a surprise with other Italian friends, second time planned and just me and Mrs RIP. We miss you Mr. DIP!

3) Experimenting Vegetarianism August 2st – September 30th.

Yes, I did it. I didn’t touch meat and fish for two months. It’s been so easy, really. I didn’t miss it at all. Ok, barbecues and social events (and restaurants) are tough, mainly due to lack of alternatives, but I must admit it’s been much easier than I expected.

Vegetarian, not Vegan. I love dairy products. Cheese, milk, butter, ice creams, eggs. I can’t get rid of them, sorry. How do I compensate for lack of meat? Ideally more veggies and legumes. So far it’s been more cheese and desserts… need to fix it.

But RIP… why?”

I don’t know. I was eating way too much meat. I’m experimenting. I don’t know if I want this to be permanent. It’s a mix of ethical and healthy reasons. I love animals and I was living a hypocrite life eating them. I know dairy industry is as evil as meat industry but I’m not here to save the world. If giving up 1% of my pleasures makes me more aligned with my values I’ll do. Giving up with dairy products would be more like 50% of my pleasures ūüôā

Anyway, I’m omnivorous again in October. It’s been an experiment, I wrote an¬†analysis doc (in Italian, intended for friends only, not going to translate)

4)¬†We didn’t go to¬†FIWE 2017.

I felt disconnected from the community and I needed time and space for myself and my family. Plus I need to focus more on my job for a while. I’m sure if I’d go to FIWE I’d quit my job the day after. I’m sorry friend, we’ll have more opportunities to meet in future.

5) I ran a Half Marathon!

Goal was to do it below 2 hours, I failed for just¬†34 seconds but I’m so happy anyway! Wanna keep up and run a full Marathon “one day”.

6) Back to 100% at Work.

Yes, starting October 1st I’m back full time after 9 amazing months working 80%. It’s not been an easy decision but I made it. Why? Was working 80% a failure? Absolutely not! It’s been amazing, really. I loved my Fridays alone. I loved that feeling on Wednesday afternoons of “the workweek is almost gone…“. So why did I come back full time?

  • I loved so much personal time alone that this motivated me to retire as early as possible.¬†80% looks like still working. If I were condemned to work my entire life I’d aim to 80% or even 60%. I think 60% is the perfect work-life balance, if work must be part of the balance. Even Keynes, father of modern capitalism, predicted a future made of 15-20 hours workweeks. Anyway, more money helps reaching my perfect work-life balance, which is 100% Life. Each extra day I go to work pays for 10 days of Life (uninvested). Let’s rush these last miles!
  • Hooli is a highly competitive workplace and even though part time working is totally accepted, it’s hard to get promoted. At my level of tenure it’s expected to grow, so I better get my sheet together and push on the pedal. Get promoted, get more money, and then maybe unplug a little bit. Eventually I might switch back to 80% after a promotion, will see. It may take one or two years to reach next level.

Numbers & Details

Don’t want to go deep here, if you care about that take a look at my NW sheet and the tabs with expenses, investing,…

Expenses highlights

Trips to Montevecchia, Rome and Austria (1843 CHF)

Yearly public transport pass for Mrs RIP (807 CHF). We’re trying Mobility for car sharing, added 25 CHF on top of the yearly pass price to have a Mobility account.

Eating out too much, above 300 hundreds per month since July. We have a lot of friends. When we came back from honeymoon everybody wanted to have a dinner with us to get updates. We love to spend time with friends, but weekends are not enough to satisfy all our social needs. Did I tell you Mrs RIP is a social beast? Well, I’m the one who pushes for having dinners at home with friends (the famous RIPPizza!) but it’s not practical during the weekdays. So we went dining out more than expected. I guess this is going back to normal in October.

New running shoes for just 50 CHF!

Wait, I gotta tell you the whole story ūüôā

I’ve ran my half marathon with shoes I felt ashamed of. Here in Switzerland everybody is visibly rich. Very rich.

They spend tons of money on everything. Sports make no difference. And it’s not that reasonable thing like “I’m getting good at Squash, let’s upgrade my entry level racket to an outrageously expensive and professional one!“. No, they go directly with cutting edge equipment.

It means that at the race everybody was wearing shiny new 500 Francs shoes and I had a pair of broken old Adidas, close to cutting themselves apart. Yes, you can see them in the picture. Probably you can’t see the not matching socks though, let me help you with another pic.

The shoes were falling apart but I’ve been running with them for last 3 years and I didn’t feel comfortable getting new ones just before the race. I decided to run this race and them let them go (with a bit of sadness).

Early on the following week I went shopping for shoes, a thing I hate hate hate. I set up a budget of 100 CHF and… wtf… after having visited few stores I discovered that here in the rich Switzerland you can’t buy decent running shoes for less than 150 CHF.¬†I was close to give up when I found a dusty box on a shop with “on sale” on it.

Last pair left, size 12 (my size) US,¬†Nike Zoom Pegasus 33 Shield. Price Tag: 60 CHF. I googled it and checked the suggested price was roughly 120-140 CHF, trending down since they just launched the Nike Zoom Pegasus Whatever¬†34. I didn’t care about the new model, I tried the shoes, I loved them (they’re also good for a heavyweight like me, with extra softness on the heels), I decided to buy them.

Not fully satisfied, I googled for Hooli discounts and discovered that we, Hooli employees, have 10% off for purchases on that shop. Would it work on top of the 50% sale?¬†Yes it did! The clerk at the shop: “ok… 60 CHF… minus 10%… ok, give me 50 CHF“. Yes, final price was 50 CHF for my new shiny running shoes. I feel so good when I find such bargains ūüôā

Income:¬†32,369 CHF –¬†Expenses:¬†10,105 CHF – Savings:¬†22,264
Saving rate for the two months is 68.8%
Saving rate for 2017 so far: 61.6%. Excluding Wedding: 73.9%
Net worth is 687,399 EUR, Delta for the two months is +34,785 EUR
FI% jumped to 62.06% (delta is not meaningful since I backfilled)

100% FI Forecast: 34 months left.
FI Date Forecast: July 2020.
Current Allowance: Year 22,340 EUR РMonth 1,862 EUR РDay 61 EUR
Current Withdrawal Rate: Real: 10.44% –¬†Ideal: 5.24%
Years of Ideal expenses accumulated: 19.1

That’s all folks!

RIP… you promised this time it would have been shorter…

screw you ūüôā

My Net Worth Split by Currencies

Hi RIP readers,

Last months my finances have been dominated by currencies fluctuations more than savings and/or investments earnings (and/or weddings!). I’ve always considered currencies fluctuations a minor factor (and I still do) in wealth management. A factor not worth taking into account, especially when talking about three of the most stable currencies around: the Euro, the U.S. Dollar and the Swiss Franc. They’re pretty solid, aren’t they? None of these will swing by more than 5% in a year compared to any other of them, am I right? We’re not in Zimbabwe!

Well, no. Currencies, even the most stable, have trends and drifts. They’re like giant turtles: they have smaller short term volatility compared to stocks and bonds, but they may go on a straight line for months and accumulate a substantial gap over years.

Before you start screaming: no, I’m not going to invest in Forex or other pure speculative assets¬†anytime soon. Speculating over currencies is a pure bet and you shouldn’t do it for the following reason: while stocks and bonds are expected to grow in the long run,¬†currency pairs are expected to stay neutral. Why? Well, you tell my why not! So you’re facing trade fees for a zero expected return. Even worse: professionals and more informed traders are playing with Forex trading better than you do. Guess who’s going to get the pluses in this zero (almost, due to trade fees) sum game?

So why do I care about currencies?

Diversification.

Yes, the wise investor mantra! Diversifying by currency is another way to avoid betting on a single horse, a way to edge yourself against high inflation in your main currency.

But RIP, being exposed to a single currency is how almost anyone live… Are we all crazy??

No, they are not. But it’s important to know that even though my grandpa is not investing, he actually is. He’s investing all in Euro currency: his pension, his flat and his savings. It’s an accepted risk, maybe. But it’s important to be aware and recognize you’re at risk. A small risk, if your main currency is the one used in the country where you live and where you plan to live for the rest of your life.

Anyway my situation is different – and I assume I’m not alone in this, given the high mobility of my generation: I was born in Italy, I’m living in Switzerland and I’m working for an American company (and planning to comeback to Italy). I need to play with three currencies!

Note: when I say “diversify by currency” I don’t mean the trading currency. I mean the currency of the underlying assets. For example, if you own a S&P 500 ETF¬†traded in CHF it doesn’t mean you are exposed to CHF, you’re still exposed to USD which is the currency of the underlying assets. In case CHF halved compared to USD, you’r fund is going to instantly double its face value in CHF.

Ok, RIP, what are you going to do to edge yourself against currency fluctuations?

Well, I don’t know yet. First step is always awareness: I’ve added a new sheet to my NW spreadsheet to monitor my currency exposure across EUR, CHF and USD.

Second, I’m probably going to try to keep my exposure almost always balanced, eventually slight unbalanced in favor of EUR first, CHF second and USD third – that’s because I plan to retire in Italy. If plans will change, balance changes too. I’m not going to formalize this by adding some rules to my IPS, I’ll just drop an eye on it every once in a while.

Let’s take a look at our currency split over the last 5 years ūüôā

Here are absolute values of assets in each currency.

To compare apples with apples everything is converted to EUR. It means the ~290k peak in the green CHF line in January 2016 is actually ~320k CHF (1 CHF = 0.903 EUR in January 2016).

What we can see is that last 5 years can be divided in 3 phases:

First, the “What are other currencies?” phase. From minus infinity to November 2012. Before moving out of Italy I only owned assets in Euro and everything was easy.

Second, the “Holy sheet let’s pile a huge amount of cash in this fancy currency!” phase. From November 2012 to January 2016. I’m so dumb. I’m sooooo dumb. I’ve been saving ~70% of my salary and watching the pile grow in my 0.1% saving account. So ridiculously dumb. Btw, the jump in January 2015 is due to unpegging CHF to EUR. I’m so dumb.

Let’s take a look at S&P500 between November 2012 and January 2016

Out of those 320k CHF, 200k were investable cash (the rest being Pension Pillars 2&3). I just ran the math to quantify my dumbness, i.e. how much it would have become if I had invested month by month during those 3 years. Drums roll… 242k tadaaaa. I left 42k CHF on the table by not investing for those 3 years. Second biggest financial mistake of my life!

Takeaway for you readers: invest as soon as possible.

I’ve always been financially illiterate and scared of market crashes. I just stashed cash, but to reach FI you have to invest your stash. You need your green army to go to work for you!

Third, the “Wait, let’s try to be smart” phase. From February 2016 on. Started investing, differentiated by asset class, markets, currencies… ¬†Did a huge rebalance in November 2016 to expose myself more to EUR than CHF and USD. EUR is so predominant today due to currency fluctuations, maybe I’ll rebalance again in January 2018.

Here’s percent split of our NW:

and here an area chart because… why not?

Final thoughts: even if you’re living your single currency life, please take few minutes to consider whether it’s worth diversifying your assets by currency. This is not a game where passive play is safer than active. You’re always in the game, even if you’re not aware of it.

May-June-July 2017 Financial Update – Yet Another Wedding

Hi RIP voyeurs,

Yes, I’m still alive!

It’s been quite a long time since my last post but I’ve been very busy with organizing my Wedding, enjoying a month long Honeymoon and wrapping life up after such a big break. Blogging has obviously been postponed for a while.

Follow me over this three months financial update, but first listen to this:¬†I don’t know if I’ll be back at an acceptable post frequency. You know why? I don’t have much to say these days. I’ve been wandering around Italy for a month and that has been terrific. We’ve visited a bunch of amazing places with only one thing in common: sheetty internet. I’ve been¬†forced able to disconnect for a while and It’s not been easy. I don’t want to look like “I found time to stare at flowers and butterflies, and the world out there is an amazing place“, I already know that. Fact is that once returned back to normal life I started digging into my feed reader and my Youtube subscriptions to find that… all articles nowadays look the same. It’s the same article loop being repeated to the infinity. kill your debts, invest, save, earn more, 4534534 ways to save money while washing your dishes, 401 ways to improve your 401(k)… I unsubscribed from several feeds and committed to post only content that is original,¬†useful and personal – in the end this is a blog! It’s my way to track progresses and be “crowd accountable” on my goals.

Another rant.

I’m getting impatient.

Life’s been so amazing while far from work that I can’t really wait so long to build a better life. The FI-nal goal keeps being pushed far in the future due to more safety margins, lower SWR and the need to define a concrete retirement plan that demands answering questions like “where?”, “how?” and “how many people?”. Maybe current FU Number needs to be revisited and consequently the RE date.

Add to this that getting back to work after a month made everything so clear: what I accept as normal in my daily life, such as “spend most of my waking hours at work, then go back home tired to try to decompress”, is so ridiculously wrong. I felt like being the slave who escaped the Plato Cave. First week after the Honeymoon has been one of the worst of my professional life. Not because strange things happened, simply because nothing happened. My wife experienced similar feelings coming back to her job.

Anyway, we’re not going anywhere soon. We just hadn’t had time to sit down and do some self analysis after the storm. We plan to do that next week. Self assessment, goal setting, priorities and a plan.

Fact is that I’m questioning the importance of the final goal (but we all know that FIRE is not the final goal) versus a significant slow-down that improves our lives today.

But RIP, you did slow down! You’re working 80%!

Yes, but that’s not enough! Working 80% had been awesome so far, but it’s a change in degree not a change in kind. I still live in the same place and do the same things. 4 days working and 3 days weekend, which means 9-10 hours alone (on Friday, roughly 8.30am to 5.30pm) plus 2.5 days involved in social activities, is not enough. Needless to say that most of my Fridays went to “The Wedding Project”. Needless to say that it’s been impossible to stick to “wake up early” in last 2 months. Maybe working 60% would be a sensible increase in well being, but right now it’s not feasible. Working 60% would be a nice setup for afterFIRE life.

And it’s not vertical enough! During our Honeymoon I was dreaming about a 66% arrangement: working October to May (8 months) and taking 4 months (June, July, August and September) off, each year. That would be really awesome. 4 months each year to travel and enough freedom to devote contiguous blocks of time to personal projects. A dream. I don’t think my employer would like that proposal though. I would accept a 75% with 3 months off too. Yet another possible setup for afterFIRE life, seasonally hopping from one project/company to another.

Ok, long rantish introduction is over, let’s get back to the main dish!

Welcome back to my monthly update. As usual, the reference doc is my NW spreadsheet.

Overview

Thanks to Mr. USD and Mr. CHF nosedive it may seem not a great quarter, with a tree month NW Delta +11,942 EUR. Split by month is May: +6,142, June: +11,458 and July: -5658. Yes, in July our Net Worth measured in EUR went down by more than 5k. Bad investments? Not at all. Spent more than we earned? Nope, we saved almost 55% of our take-home pay.

“RIP, Are you kidding me?”

Nein! Welcome to the land of a multi-currency life! The fact that both CHF and USD dropped a lot compared to EUR combined with the fact that our NW is roughly equally split among EUR (ETF and an apartment), CHF (Pillar 2, 3 and cash) and USD (several ETFs) generated this funny situation where our NW measured in CHF (+52k) or USD (+74k) skyrocketed, but in EUR it sinked.

Truth is, I’m satisfied. A Wedding went by without leaving any dent in our finances. That’s actually ridiculous. I knew it’d be true, since Italians use to give money gifts, roughly paying back their share of the main cost (the restaurant/location) and giving something more. Add to that that close relatives like parents and grand parents – yes, I still have 2 living grand parents – use to give a lot, in the order of thousands of Euros. Essentially our absolutely-non-frugal Wedding went by costing almost zero to us. Not an excuse to indulge in luxury, someone is still paying for it (and your turn is split across a lifetime of other people’s weddings).

Major wins for May-July 2017:

  • Mr. Market still very generous, with Emerging and Pacific performing amazingly, along with Tech US (again!). Anyway, the free ride maybe over soon: CAPE is close to 30.
  • June huge Hooli vesting. Several stocks, roughly 20k USD gross, 12k USD net. June is an amazing month. December will be even richer, unless Hooli stock price dropped or I get fired before.
  • Bonus while at the beach. Don’t check work email they say. Unless you see a subject like “Congrats Mr RIP, here’s a bonus for you: 1000 CHF!“. It was related to a project we launched just before I went on vacation.¬†Nice feeling ūüôā
  • Zero Spending for 8 days in a row. Mrs RIP tool June off. She went to Italy on May 31st to babysit The Wedding Project in its final days. I joined her on Thursday June 8th evening. Despite money flowing away from us by the thousands those days, I went hardcore cheapass. I spent ZERO in those 8 days alone. Zero. I ate leftovers, I biked to work. I walked. I avoided any – ANY – expense. It felt great, although financially impactless.
  • Financially Neutral Wedding. Enough said. I won’t dig into details. Honeymoon (4.4k CHF) not included. Expensive Wedding covered by gifts plus an almost frugal Honeymoon on our shoulders.
  • Yet Another Rent Reduction.¬†Referenzzinssatz (reference index) went down and we asked for a rent reduction. Got 28 CHF per month back, starting in October 2017. From 1443 CHF/Mo to 1415 CHF/Mo, including Condo Fees.

Losses of May-July 2017:

  • CHF and USD Nosedive. Both currencies are losing terrain respect EUR. USD lost 11% since the beginning of the year, while CHF lost 6.4%. Enough already said.
  • Too many expenses. Even if you remove the Wedding from the equation, our baseline is too high. Trending higher. We need to return on Earth asap and take control.
  • Indulged in new internet + tv contract with UPC Cablecom. After 4.5 years with the same contract and hardware, I decided to do some upgrades. Moar Internet (200Mbps), moar TV (10+ Italian Channels), bettah Hardware (Verizon HD Recorder vs old Mediabox). 115 CHF/Mo vs 64 CHF/Mo. Wait! Before you start screaming let me add that: (1) new offer include cabling costs of 38 CHF/Mo that I’m currently paying in my condo fees (so I expect them to drop by the same amount) and (2) Hooli is reimbursing 50% of my “internet fee”. Final math says I save some money with the new contract. I still feel somewhat guilty for this upgrade…
  • Mrs RIP took a sabbatical month for our Wedding¬†plus the first week of July as paid vacation. No salary on June for her. It’s a financial loss even though it’s been amazing for her to stay ~40 days without working.

Other financial facts:

  • Heavy investment rebalance. I was hoarding cash for the mid-year investment rebalance. Sent roughly 30k CHF, 10k EUR and 15k USD to Interactive Brokers and rebalanced to meet my IPS. Purchased 30k EUR of Euro Stoxx600 ETF and 15k USD of Small Cap US ETF. Still 8k CHF are sitting on IB, for me to play the “let’s time the market!” game.
  • Finally closed UBS account in early May. Simplify, simplify.
  • Moved my¬†Pillar 3a saving account from PF to UBS and opened a Pillar 3a for Mrs. RIP. Thrown there¬†6768 CHF for both of us, the maximum allowed. Our 2 Pillar 3a accounts sum up to more than 40k CHF. Still unsure if it’s worth investing the Pillar 3a with PostFinance Funds like Pension75.
  • Closed Mrs RIP Italian expensive bank account¬†and moved her money into our shared EUR account within our PostFinance accounts. I’m keeping my Italian bank account mainly for easy cash access when in Italy and to not have to sell our 12k EUR, 5.5% yield Buoni Postali (CDs). Current setup for EUR expenses: cash withdraws either at Swiss PF ATMs with EUR PF Card or in Italy at Bancoposta ATMs. At shops, use my Italian ATM card. Online… we need to use a CHF card (Cumulus Mastercard) and accept currency conversion spread.

Other Facts:

  • We got Married, again ūüôā This time in Italy, with 130 guests and a church, a cake, rings, dresses and all the stuff. I didn’t expect it to be so extremely amazing. We had a perfect day, surrounded by all the friends and relatives we wanted with us on that special day. Totally worth all the effort (a lot of it) we put on it.

  • We spent a month on Honeymoon. We didn’t do anything very fancy according to standard Maldives/Seychelles honeymoons. We rode Mrs.RIP parents’ car across Italy for 4k Kms, heading south on the East coast (Marche, Abruzzo, Molise, Apulia) and coming back in the north along the West coast (Basilicata, Campania, Lazio, Tuscany). It’s been a relaxing month, spent on italian food, beaches and sea in June and early July when the crowds are not on vacation yet. Heaven!

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  • I just returned from a end of July 3 day hike with 3 friends: Pragelpass Weg. Just to remind myself how awesome is to be in the nature, with friends. 60km in 3 days with backpacks.

  • Blogged Zero in last three months. I still love writing and I want to do more of it. Now that life might ease a little bit I expect to be more active. By “blogged zero” I mean not even interacting with other bloggers, commenting other posts, twits, etc. I didn’t even log into FB for a couple of months (and found few messages I should have replied earlier, sorry friends!).

Numbers & Details

Total Income for the three months was 74,783 CHF (row 40). Income includes Wedding Gifts, salaries, stocks and a spot bonus.

Total Expenses for the three months were 36,265 CHF (row 41), without Wedding&Honeymoon 12,251 CHF (row 46).  More details on my expenses sheet.

Yes, I consider wedding gifts as income and wedding expenses as expenses. Not just for accounting¬†cleanliness, but for long term planning and forecasting I’d like to not consider these one-off events. I’m also keeping track of income/expenses without Wedding/Honeymoon (rows 45 and 46). Expenses without wedding were below 4500 CHF per month.

Expenses highlights:

  • Wedding & Honeymoon. A_LOT CHF, totally worth it :).
  • Housing. More than 760 CHF taxes for the Italian apartment…
  • Utilities. Paid yearly 450 CHF tax on TV in May. Spent 70 CHF in roaming data in Italy during Honeymoon.
  • Groceries below average since we’ve not been at home for a while.
  • Leisure. Purchased Pandemic Legacy to play it with close friends. Mrs. RIP withdrew 500 CHF for her personal expenses. Classified as Other Leisure and accounted at withdraw time (she probably has still most of the 500 CHF in her wallet, but I don’t want and need to know).
  • Travel. 320 CHF for the three day hike on the Pragelpass.
  • Dinners out. Everyone wanted to meet us once we’ve returned to Switzerland, so we indulged a little bit with going out in July (close to 300 CHF spent).

Total savings are 38,518 CHF (row 42).

Saving rate for the three months is 51.5% (row 43), excluding Wedding 75.6% (row 47).

Saving rate for 2017 so far: 60.0% (cell Q43), excluding Wedding 75.3% (cell Q47).

Net worth is 643,444 EUR (cell K17), Delta is +11,942 EUR (row 18).

The progress bar changed from 57.01% to 58.09% , with a step of +1.08% (in three months) toward the big goal.

Forecast for 100% FIRE: 42 months left (+7 months), i.e. forecast Fire Date is January 1st¬†2021, (cell V10). That’s horrible ūüôĀ The goal is moving away from me faster than I’m moving toward it. It’s like space expansion caused by dark energy that makes galaxy clusters move away from each other at a faster than light speed… I dread to see what would happen to this very metric when market crashes.

Current Monthly allowance: 1,743 EUR (+33 EUR, cell V13).
Current Daily allowance: 57 EUR (cell V14). Food is paid forever from now on. We won’t starve!
Current Withdrawal Rate РReal:  11.06% (+2.19%, cell V16). A disaster. Current WR is driven by current last 12 months spending, and these include Wedding.
Current Withdrawal Rate – Ideal: 5.59% (-0.11%, cell V17).
Years of Ideal expenses accumulated: 17.9 (cell V20).

Next Steps & Other Updates

  • Thinking about moving to a bigger apartment. I know it seems totally anti-minimalist, but we had an opportunity we declined few weeks ago. Our current apartment is just fine for the two of us, and extremely cheap for where we live. We love it even though it lacks basic comforts like a dishwasher, a washing machine (it’s in the basement, shared with other 10 neighbors), an elevator (we live on the second floor, European second floor i.e. American third floor) and parking space. We’re ok with all the limitations for now. What if we had a baby?
  • Need to face the italian apartment now. It’s costing me. It’s not rented. It’s kind of abandoned. Time to take a decision, probably sell it with a loss. It’s not easy though. I need to go there to talk with agencies and get an evaluation and bla bla bla.

That’s all folks!

April 2017 Financial Update – Quaranta

Hi RIP voyeurs,

April¬†2017 is gone and hopefully this new wave of winter is gone too.¬†Before jumping into numbers let me explain why you didn’t hear from me for an entire month. April has¬†probably been one the busiest month of my life so far, so many things happened! I had no bandwidth¬†for writing and blogging and several other activities. My “watch later” list on youtube crossed 200 videos and my “read later” bookmark folder¬†crossed 1000 (!!) links, maybe it’s time to declare¬†a “bookmarks bankrupt”?

Anyway, I’m fine with that (for now). My April 2017 has been filled with so many amazing life experiences and I chose to fully enjoy them with no commitment on blogging except for this monthly financial (and personal) update. I don’t see myself blogging much more for the next 2 months given we’re organizing the Italian Wedding and then going on Honeymoon for 4 weeks. I’d be surprised (and very happy) in case I am wrong on this.

Welcome back to my monthly update. As usual, the reference doc is my NW spreadsheet.

Overview

Numbers may not grasp the actual goodness of this month. NW Delta +8,078 EUR may seem not that good but I’m actually very happy!

Major wins for April 2017:

  • Mr Market bullish again, most of my ETFs went up, with the STOXX600 horse (Euro area) running like crazy after France election!
  • Contained expenses. Yes, above¬†5k CHF this month but more than¬†1K is extra and one-off (Travel, Wedding, my 40th Birthday party, quaranta anni). We did good after all.

Losses of April 2017:

  • Very strong¬†EUR currency. France elections boosted EUR currency and stocks. I measure my NW in EUR while I own assets in 3 currencies. It means my NW measured in EUR got a bump. Anyway, not a big deal, currencies fluctuate. On the bright side, my NW in USD got a +23.5k, that’s an incentive to retire in US, lol!
  • Naked Hooli salary. No bonuses, no stocks, just my very naked salary this month. Turbo-Sad.

Other Financial Facts

  • I have 13.5K sitting in my brokerage account. That’s my timid attempt to time the market, proven wrong so far. 10K are sitting since a couple of months, 3.5K since the beginning of this month.¬†Market performed well, so wasted opportunity here. Never time the market!
  • We are accumulating cash. Now that both my salary and Mrs’s one are flowing into the shared account, we have a fat cash reserve. This is not an attempt to time the market, it’s more about we should sit together and discuss what to do with money. We have a wedding + honeymoon coming so we’ll need¬†cash. Will think about it in July, after Mrs RIP takes her very deep financial course with an awesome teacher: myself ūüôā

Other Facts

  • Theater theater theater! 2 amazing weeks of plays. It’s been a success (for an amateurial company) from every point of view. Attendance satisfied, new friendships built, genuine feelings and whatever else. I found myself biking back home late at night singing and feeling very happy. That’s just the beginning, we’ll soon start planning next show and few summer activities, workshops, etc.
  • Run a relay Marathon. I spent the whole March training for it. I performed way better than expected. I’ve run 12 km in little above 1h. Next step: Half Marathon in September and probably a Marathon next year! Sadly, after the run¬†I had a small calf muscle injury and I’ve not trained much during second half of April, but I’m getting better now and running again ūüôā
  • Another Hike Trip, along the Via Francigena with Mrs RIP and a group of 16 people during Easter holidays. It’s my third hike trip in less than 1 year: May 2016 Italy Coast 2 Cost walking alone, October 2016 Via Appia with a dear friend and April 2017 Via Francigena with my wife and a large group. Three totally different experiences. This one was really amazing. From San Miniato to Siena, all in Tuscany. 5 Days walking a total of 100km with backpacks, almost always immerse in nature with no cars in sight.¬†Not a very tough hike but spectacular landscapes¬†and nice¬†group. Made a lot of new friendships and, most important of all, Mrs RIP first hike trip stimulated her. She wants to repeat the experience! Another taste of FI life. Photo gallery at the bottom of this post ūüėČ
  • Visited Rome while Mrs RIP went to Milan. I’m not going to Rome frequently these days. I went after Easter (for 5 days) mainly to give Wedding invitation letters to friends and relatives. Meeting uncles, aunties, cousins and grandparents was fun, but spending a full sunny day hiking in Rome, 28km by foot, covering almost everything a tourist can do in a week¬†was priceless.
  • I turned 40 years old. Since our life is so intense this season I asked Mrs RIP to not do anything spectacular for this special date. No big celebrations.¬†She can’t help, she organised what was supposed to be an informal “apero” at our place and became a 20 people thing with 24 hours of upfront preparation, cooking and organization. But it’s¬†been a very warm and frugal party, I love my wife!
  • Loosing weight took a pause. Intense sport month till Francigena hike, then dropped everything. With an intense life I had trouble keeping up with good habits. Bad weather and a calf muscle problem set me down for a couple of weeks.¬†I allowed myself to overeat and drink a little bit too much during theater nights and travel. Getting back on track in May.
  • blogged ZERO this month. Enough said. I’ll be back.
  • Having hard time keeping up with my waking up early habit. Several late evenings both due to theater and celebrations of various kind. But it’s ok and I’ll be back on track soon.
  • I met MP!¬†Yeah, I physically met the awesome person behind The Mustachian Post blog (and forum)! We¬†met for lunch and we had a 2 hours intense discussion over soooo many interesting topics. We seemed happy like children, like we knew each other since forever. It’s so fulfilling to know you’re understood and you speak the very same language ūüôā I hope we’ll meet again soon, maybe at FIWE?

Numbers & Details

Total Income for the month was 16,770 CHF (cell H40). Base income for both of us. I started putting Mrs. RIP Pillar 2 contributions in our NW and cash flow.

Total Expenses for the month were 5,070 CHF (cell H41). Without Wedding expenses 4,547 CHF (cell H45). More details on my expenses sheet.

Expenses highlights:

  • Wedding. 523¬†CHF, payments for photo shooting, flowers and make up.
  • Travel. 442 CHF, Francigena expenses like hotel room for the night before starting the trip, in Bologna, and cash expenses for food (and beers) for the 5 days.
  • Groceries. 891 CHF, kind of a lot. We¬†did a bulk grocery purchase in Italy and spent quite a few bucks in groceries for our “frugal” 40 years old Mr. RIP party at home. It’s ok.
  • Transportation. 231 CHF for train tickets, tickets from Siena to Rome (me), Milan (Mrs RIP) and then back to Switzerland for both of us. Probably these should be budgeted to Travel.
  • Dinners out. 102 CHF, essentially we didn’t go out but on the very last day of the month, still on “40 years” celebration mood.
  • Leisure. 547 CHF, Theater, theater tickets I gave to relatives that came to watch me¬†acting, a day in the SPA (40 years old celebration, ok, not so frugal) and¬†Mrs. RIP cash withdraws. We can do better here.

Total savings are 7,953 CHF (cell H42), not too bad after all.

Saving rate for the month is 61.1% (cell H43), excluding Wedding 65.1% (cell H46).

Saving rate for 2017 so far: 69.4% (cell Q43), excluding Wedding 75.1% (cell Q46).

Net worth is 631,502 EUR (cell H17), Delta is +8,078 EUR (cell H18), percent +1.30% (cell H19).

The progress bar changed from 56.28% to 57.01% , with a step of +0.73% toward the big goal.

Forecast for 100% FIRE: 35 months left (+1 months), i.e. forecast Fire Date is March 1st 2020, (cell V10). Uff, the goal is moving faster than us. I knew that since 12 months linear forecast is stil consuming those awesome 2016 months when NW delta were above 20k per month.

Current Monthly allowance: 1,710 EUR (+22 EUR, cell V13).
Current Withdrawal Rate РReal:  8.85% (-0.23%, cell V15).
Current Withdrawal Rate – Ideal: 5.70% (-0.07%, cell V16).
Years of Ideal expenses accumulated: 17.5¬†(cell V19). If we cash all our assets we can live with 3k EUR per month without the need of any money until end of 2034, assuming no income and no investments. Reassuring, isn’t it? ūüôā

Next Steps & Other Updates

  • Prepare myself psychologically for the ~20k Wedding&Honeymoon expenses over the next 3 months
  • Invest these 13.5k I have sitting in my Interactive Brokers account.
  • Keep postponing financial chores (close UBS account, Pillar 3a for Mrs. RIP, Pillar 3a funds¬†instead of saving account for both of us, invest more instead of keeping too much cash)

How was your April? Mine was ridiculously intense!

Enjoy this gallery of Via Francigena’s hike!

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March 2017 Financial Update – Marriage edition

Hi RIP voyeurs,

March 2017 is gone, spring arrived earlier this year in Switzerland. At the time of writing this post it’s 23 degrees and I’m biking to work wearing only shorts and t-shirt!

Welcome back to my monthly update. As usual, the reference doc is my NW spreadsheet.

Overview

A very unusual month and hard to compare with others, mainly for a special reason:

♥ We got married ♥

Yes, Miss RIP¬†is now finally Mrs. RIP. Ok, I previously explained that we’re¬†going to celebrate in Italy later this spring with relatives and friends, but we got legally married few days ago in Switzerland! So yeah, I’m getting married twice this spring. Cool. And turning 40 years old. Less cool.

Ok, back to the¬†finances. From a financial standpoint, getting married in Switzerland means life is split in before and after. We keep as individuals, what we had before. We share what we’ll earn after. It means we now have individual economies and a shared economy. Since almost 3 years we were already contributing into a shared account so we’re used to a shared economy. But we did that just to cover for shared expenses, not to accumulate wealth. Contributions were similar to taxes. Each one had to take¬†individual decisions to manage his/her own wealth.

Now every source of income goes directly into the shared account. We’re responsible together for every new purchase, debt, investment. To make this manageable, Mrs. RIP delegated shared wealth management to me – but I¬†demanded we do monthly reviews together and I’ll also offer some basic financial lessons to her. I’m not ok with being alone understanding our finances.

About expenses, we need approval of both for shared expenses above a certain amount (still undefined) and we allow 500 CHF each for monthly individual expenses with no question asked. At the end of each month we send 500 CHF to our individual accounts.

Net Worth. I used to track my net worth plus the shared one. Since we plan to reach FI together and since I¬†just care that we, together, will reach FU Number, I’m going to merge the NWs and track the sum of them. I know, it’s risky for several reasons:

  • Mine is bigger.¬†I mean my NW is an order of magnitude greater than hers. But we’re together and I don’t care. I’d already be FI if I had to cover just for my personal expenses.
  • I lose a bit of control over Saving Rate and NW: every individual Mrs. RIP expense would impact the saving rate and our total NW. But yeah, that’s true anyway ūüôā
  • I lose a bit of control over Asset Allocations: Mrs. RIP has some cash, more than what’s reasonable for a normal emergency fund. She’s not into investments and I don’t want to force her. I’m ok to push for aggressively managing our shared wealth, but not her individual one. Summing our NWs would skyrocket the cash component.¬†Not a big deal, I will compensate as much as I can reducing my own cash reserve and the shared one.
  • I lose expenses trackability: I don’t want to (and I totally shouldn’t!) track Mrs. RIP individual expenses, but¬†I’d like to¬†get a sense of total amount.¬†I’ll keep accounting individual¬†expenses I see on our credit card into their own bucket, but her cash payments are not tracked individually. When she withdraws cash, I just consider it as a Leisure expense at withdraw time.

Given all the above, this month we had an obvious nice jump on total NW,¬†with a NW¬†Delta of +45,331 EUR¬†I’d like to fuzzy a bit Mrs. RIP’s NW so I won’t provide many breakdowns.

Anyway, as usual, here are the major wins for March 2017:

  • We got married. It’s a win ūüôā
  • Mr Market got a cold mid month but he’s back on track! My Euro Stoxx600 ETF, where I invest ~150K EUR, went up 3%. Both Emerging Markets and Pacific went up 2.5% – 3%. US market ETFs stayed stable overall, with Tech (again!) covering for Small Caps’ losses.
  • I’m the new swordmaster! I did something unprecedented (well, I’m not sure) in Swiss history: I contested a medical bill and got a reduction! Well, not much,¬†just 16 CHF from 354.40 to 338.60 but believe me it’s a great feeling. The story is: understanding Swiss medical bills is impossible, they have hundreds of complex entries. Even though my German is not very good, it’s good enough to understand that they charged me ~40 CHF for a “phone consultation” of three 5-minutes blocks, i.e. 15 minutes. What actually happened is that they call me to tell me “your blood exams are good, let’s meet again end of March, bye bye“. I went thru my call history and I found the call to be 2 minutes and 9 seconds. I¬†walked in their building ready for a fight¬†and I obtained a 5 minute block cut from¬†our “phone consultation”. Plus I canceled the checkup visit.
  • Hooli stocks vesting. Extra money. I sell them automatically as soon as they vest. The proceedings are sent to my IB account ready to be invested. I have vesting events in March, June, September and December. June and December¬†are major vesting events, March and September are minor ones.

Losses of March 2017:

  • Too many expenses. Dangerously close to 7k CHF. Ok, there are one-offs here, like 2170 CHF Wedding related, 830 CHF travel related, the above mentioned 340¬†CHF for the medical bill, but¬†there will always be one-off expenses every month (hopefully not wedding related after July!).
  • Stronger EUR currency. Since I measure our NW in EUR and we own assets in EUR, CHF and USD, having a strong EUR means our NW performed worse. The USD was losing 3% till few days ago, it eventually recovered most of if.
  • Naked Hooli salary. No bonuses, just my naked salary this month. Sad.
  • Having hard time keeping up with my waking up early habit. Several late evenings both due to theater and celebrations of various kind. But it’s ok and I’ll be back on track soon.

Other Financial Facts

  • Changed Target Safe Withdrawal Rate (SWR) to 3.25% after a very deep dive thru the incredibly amazing¬†Ultimate Guide to Safe Withdrawal Rates,¬†on¬†earlyretirementnow blog. Everyone who’s planning to¬†retire on investments should definitely read all their¬†posts!¬†Previous target SWR was 3.33% so it means we’re playing it safer and we’d require a bigger FU Number.
  • Increased Target monthly allowance to 3000 Euro per month. Another safety margin at play here. Another FU Number increase. I don’t know if it will be the last one, I may play with monthly allowance more in the future. Anyway, these two factors pushed FU Number to slightly more than 1.1M EUR.
  • I’ll Track Saving Rate (SR) with and without Wedding Expenses. Wedding is (hopefuly) one-off. We’ll face wedding expenses till July (Honeymoon) and forecasts are north of 25k EUR, including Honeymoon. My principles¬†say that I should save at least 50% of my¬†take-home pay and I want to measure it against standard expenses, not extraordinary ones.

Other Facts

  • I lost weight. How much? Roughly 5 kg. How? A combination of few things worth a post on his own ūüôā Here’s a teaser trailer: strong motivation (getting married in June in Italy, want¬†nice pictures), accountability (signed up for a half marathon happening in few days, a 5 days hike trip in Italy with Mrs. RIP during Easter and a triathlon in August) affirmation (got inspired by Tim Ferriss Show episode with Scott Adams, anyway, more on this in its own future post), mindfulness eating¬†and tracking. I’m not done. I plan to keep going till end of the year and hope these new habits will stick and become the new normal.
  • Theater¬†Acting Intensified. I’m on stage these days. 2 weeks of plays. We spent most of March doing rehearsals even during the weekends. I love this kind of life. That’s another taste of FI. I remember back in 2002 when I started (ouch, 15 years have been passed, how old am I??) I was close to quit my studies to go all-in with theater acting. Good thing I didn’t, but at the time I wondered “what if…”. Well, reaching FI means I can discover “what if”! I’m really craving for it. I look forward to having more time to play even more intensely. That’s yet another reason not to go out for dinner or spend money on happinessless things.
  • I blogged almost ZERO this month.¬†Too many things on my plate. But I’m way happier thanks to increased physical activity, more outdoor time and theater acting, so I don’t actually care. But yes, I have a new¬†series (and several dozens of new post ideas…) for this blog coming soon. Stay tuned!

Numbers & Details

Total Income for the month was 16,770 CHF (cell G40). High income due to Hooli stock vesting and Mrs. RIP salary. I’m not counting Mrs. RIP Pillar 2 contributions yet.

Total Expenses for the month were 6,932 CHF (cell G41). Without Wedding expenses 4,765 CHF (cell G45).

More details on my expenses sheet.

Expenses highlights:

  • Wedding. 2,167 CHF,¬†some payments for rings, dresses and a luxury lunch with close friends here in Switzerland.
  • Housing. Italian condo fees 120 EUR.
  • Health. 338 CHF for the doctor visit and the phone consultation I mentioned above.
  • Transportation. Good month here. Few trains tickets purchased for Mrs. RIP’s family to come to visit us beginning of April (to see me acting) and¬†no monthly¬†local pass for me. I bike to work with this nice weather!
  • Travel. Paid off our 5 days hiking trip with Mrs. RIP along the Via Francigena during Easter (in a couple of weeks!) and purchased some gears for it, mainly hiking shoes (mine wore out after more than 10 years).
  • Leisure. As I said, Mrs. RIP cash withdraws go here.

Total savings are 9,838 CHF (cell G42), not bad, above the acceptability threshold.

Saving rate for the month is 58.7% (cell G43), excluding Wedding 71.6% (cell G46).

Saving rate for 2017 so far: 71.4% (cell Q43), excluding Wedding 77.4% (cell Q46).

Net worth is 623,424 EUR (cell G17), Delta is +45,331 EUR (cell G18), percent 7.84% (cell G19). As I said, these numbers are kind of meaningless this month since we joined our NWs.

The progress bar changed accordingly, from 57.81% to 56.28%, with a step of -1.53% toward the big goal. This is because we moved the target away.

Forecast for 100% FIRE: 34 months left (+4 months), i.e. forecast Fire Date is January 1st 2020, (cell V10).

Current Monthly allowance: 1,688 EUR (+136 EUR, cell V13).
Current Withdrawal Rate РReal:  9.08% (-0.44%, cell V15).
Current Withdrawal Rate – Ideal: 5.77% (+0.00%, cell V16).
Years of Ideal expenses accumulated: 17.3 (cell V19).

Next Steps & Other Updates

  • Not closed UBS account¬†yet, too busy. Will April be the month?
  • Not made any decision about Pillar 3a investments¬†for both me and Mrs. RIP with PF yet.
  • I have 10K CHF and soon 3.3K USD sitting on my Interactive Brokers account. Need to think what to do with them.
  • Not planning to invest shared money in April, even though our cash reserve is higher than planned.¬†Keeping cash for Wedding & Honeymoon expenses.

How was your March?

Mine was veeeeery intense ūüôā

February 2017 Financial Update

Hi RIP voyeurs,

February¬†2017 is gone, it’s been incredibly warmer than average¬†here in Switzerland, it really looks like spring already!

Welcome back to my monthly update. As usual, the reference doc is my NW spreadsheet.

Overview

This was a strange month. First of all,¬†lowest saving rate since started this blog, 50.9%. Ouch. Few unexpected medical expenses, some expected wedding expenses and lowest salary ever¬†since joined Hooli made it. I guess next 3-4 months won’t be better, with wedding date getting closer. Second, very high NW Delta of +19,496 EUR. How is it possible? Last month we saved 23k and NW went up by 6k… this month we saved 5.5k¬†and NW went up by almost 20k, am I cheating? No, it’s simply that cashflow is not the same as net worth. NW growth is affected by savings, investments growth, and (in our complex 3-currencies life) currencies fluctuations.

Anyway, as usual, here are the major wins for February 2017:

  • Market’s doing incredibly great!¬†I’m here, sitting on my chair, waiting for the market crash, the apocalypse and all the things and nothing happens!¬†Why? All my ETFs are up at least 3%¬†during February. I’m so tempted to time the market
  • EUR is weaker compared to both CHF and USD. I’m tracking my NW in EUR and I’m exposed a lot to both CHF and USD. EUR/CHF moved a little¬†while EUR/USD a lot. Both¬†in the right direction. Does it seem odd to aim for a weaker reference currency?
  • Slightly greater than expected 80% salary. February is one of those boring month where I don’t have 13th, yearly bonuses or stocks vesting. So I can finally see what’s my regular salary about. My base net salary is ~86% compared to a base one from last year. Cool. 80% work, 86% pay ūüôā
  • Miss RIP got a raise. A small one, still better than nothing. This raise¬†in not visible here, since I’m not tracking (yet) her NW and we keep contributing in ratio 3:1 to shared economy. Wait… now that I work 80% and she got a raise my net salary is no more 3 times hers so we should change internal taxation! Nevermind, starting next month we’re going to¬†join future incomes.

Losses of February 2017:

  • Expenses over 5000 CHF. I set 4k CHF as “we did great” threshold and 5k as “we should be worried” threshold. We went above the second one. The good news is that¬†base expenses were ok. If we exclude wedding expenses (1141), unexpected medical expenses (364), book-in-advance-to-save-money train tickets (~200) and once-per-year¬†expenses (165, Miss RIP’s Half-Price Card) then we are below 4k. It’s a weak excuse though, our life is so complex that it’s normal to have unexpected expenses. It’s kind of… expected!
  • Saving rate¬†slightly above 50%. The minimum since blogging. Why? Because of both a base¬†80% salary and high expenses. At least it’s still above my acceptability threshold of 50%.

Other facts:

  • Invested more money. Sold Hooli stocks and invested the whole 14k from proceedings. Why did I sell them? Am I not being loyal to my awesome employer? No, it¬†has nothing to do with loyalty. It’s about differentiation. I’m already exposed a lot in Hooli and in IT in general because that’s where I work. What happens if Hooli bankrupts¬†tomorrow? I’d lose my job, my immediate ability to earn a lot of money AND my stocks. Differentiate for the win.
  • Another round of rebalancing,¬†according to my¬†IPS. When I wrote my IPS I defined what my ideal asset allocation strategy would be. My actual investments were not aligned with my strategy back then. I’m aiming to my ideal allocation without having to revolutionize all my investments (which would generate huge trade fees).
    my investment sheet

    So, here follows this month’s steps: sold another 20k of Tech US ETF (SWX:XLKS-USD). With 34k available (20k from selling Tech US and 14k from selling Hooli stocks) I purchased 17k of a Pacific ETF (SWX:CSPXJ-USD) and 17k of an Emerging Market ETF (SWX:CBMEM-USD). According to the investment sheet¬†on my NW spreadsheet I’m almost good. The sheet is not in sync with my IPS though. I may tweak a little bit my IPS to include a 15/5/5 split of US exposure (large/tech/small) instead of 20/5 (large/small). Need to think about it.

  • 80% life kicking in. I’ve been able to enjoy 4 amazing 3-days weekends, the last of which have been spent entirely with Miss RIP, like a small 3 days honeymoon at home.
  • Got a credit card. Why? Wasn’t I showing off by claiming I never had a debt?? Well, keep these¬†complains for next post about “my credit card experience” so far ūüôā

Numbers & Details

Total Income for the month was 10,797 CHF (cell F40).

Income highlights:

  • ~7,900¬†– my Hooli salary + a spot bonus and some extras (base 80% salary ~7.5k).
  • ~1,900 – my¬†Pillar 2 contribution.
  • 1,000 – Miss RIP contribution to shared economy.
  • 15 CHF – Migros Blue coupons.

Total Expenses for the month were 5,300¬†CHF¬†(cell F40). Expenses detail on my¬†expenses sheet. There are 10 CHF untracked from my new credit card that should show up in next few days. I’m going to backfill expenses once the issue is solved. Here on the right a screenshot of 2017 expenses so far. Click on it for details.

Expenses highlights:

  • Wedding (1,141 CHF), not counting several train tickets we purchased which¬†are because of the Milan wedding.
  • Health. I got a tooth repaired in Italy for 170 EUR and I few exams in Switzerland for 183 CHF. Still waiting for another doctor bill expected in the range of 200-300 CHF.
  • Transportation. Purchased a lot of trains tickets (~200 CHF) for March, April and May. Successfully experimented blablacar twice! Here’s the story: it used to be simpler to find cheap train tickets to Italy on Fridays and Sundays. Sadly, it’s no more true unless you purchase them months in advance (that’s why we did some planning and crazy shopping for the months to come) and it’s hard to find discounted tickets on Sundays. We had to go to Milan a couple of weekends ago and there were no discounted tickets. Buying tickets full price (with half price card) for 2 people (round trip) would have costed¬†~220 CHF. A lot. We used to pay 10 or 20 each ticket (40-80 total). Just before I was going to buy the pricey tickets mumbling and complaining with “the system”, my beloved Miss RIP proposed “why don’t we try carpooling? Like Blablacar?” We tried, we spent 15 EUR per person per ride (75 CHF total considering blablacar fees and currency conversion), we had nice and comfortable experiences and we met great people! Strongly recommended! We’re still missing few tickets in our trips plan for the next 3 months, but we’re completely relaxed since we have a new default option!
  • Restaurants and “food outside house” above 300 CHF. A lot, I know.¬†We indulged a little bit, but that’s a category¬†that gives us a lot of value so it’s ok. Fondue with friends? I’m always in!
  • We went to an overpriced SPA with friends and spent more than 100 CHF for 4 hours. Nice experience but too expensive.
  • Several IB¬†Trade fees (52 CHF) for¬†investments.

Total savings are 5,497¬†CHF (cell F42), too little saved this month.¬†Saving rate¬†for the month is 50.9% (cell F43), barely acceptable. Saving rate for 2017 so far: 77% (cell Q43), declining too quickly¬†to normality ūüôĀ

Net worth is 578,093 EUR (cell F17), veeery good! Delta is +19,496 EUR (cell F18), percent 3.49% (cell F19). Good, thanks Mr Market and Mr USD!

The progress bar changed accordingly, from 55.86% to 57.81%, with a nice step of +1.95% toward the¬†big goal. We’re almost back in the 2% monthly jumps world ūüôā

Forecast for 100% FIRE: 30 months left (-3 months), i.e. forecast Fire Date is August 1st 2019, (cell V10).

Current Monthly allowance: 1,552 EUR (+54 EUR, cell V13).
Current Withdrawal Rate РReal:  9.52% (-0.23%, cell V15).
Current Withdrawal Rate – Ideal: 5.77% (-0.20%, cell V16).
Years of Ideal expenses accumulated: 17.3 (cell V19).

Next Steps & Other Updates

Money & Investing

  • Everything is ready to close UBS account, probably doing it in March.
  • Still thinking about a better Pillar 3a with PostFinance, like¬†PostFinance Pension 25/45/75. TERs are high, considering that they are funds of funds, and market diversification is very low. They invest in Switzerland stocks, essentially 3 stocks (Novartis, Nestl√®, Roche). I know there are better options out there but I’d rather stay within PF, my financial life is complicated enough and I don’t want to make it more complex. Plus, Pillar 3 constitutes less than 5% of my total wealth and I may want to withdraw it within next 5 years. Keeping my money into a saving account at 0.2% interest may still be ok.
  • What about a Pillar 3a for Miss RIP? We’re getting married and next year we’re going to join our tax returns which means we might want to save taxes on those 6.7k she could set aside. In that case there will be too much money sitting at 0.2%, funds become more tempting.
  • Extra rebalance to adhere to my IPS. I’ve done a good job moving money around and investing more in Jan-Feb with limited friction (115 CHF total fees).¬†As mentioned before need to think about 15/5/5 split between Large US, Tech US, Small US vs 20/5 Large/Small as mentioned by my IPS. Technically it’s the same stuff. Tech US are large companies. Problem with current split is that I’m triple exposed with Tech US: I work for them, I invest in Large US (most of them are tech anyway) and I invest in Tech US. Home¬†bias is hard to die!

Wedding

Wedding is coming! We’d get officially married in Switzerland in March, and then we’ll celebrate it with a big party in Italy in June. March will be an interesting month! From a financial point of view, the default in Switzerland is that we, individuals, keep whatever was ours before the marriage while whatever we make as a couple after the marriage is then shared. If you want¬†something different (sharing everything or keep finances separate) you need to sign a contract in front of a notar. Anyway, since we’re planning to reach FI together I’d add Miss… pardon, Mrs RIP NW to mine. Expect a nice jump forward in March ūüôā

About the wedding budget… last time I took a look at the spreadsheet it was dangerously coming close to 25k…

I need to find a way to account for monetary wedding gifts too. Both my parents and future in laws¬†are going to give us money, several thousands. I expect some of the invitees will too. I don’t want to consider it as income nor I want to don’t consider monetary gifts at all. Need to think about it.

Blog

February has been my least active month on my blog and on the communities (forums, other blogs,…) since I started blogging. I’m not losing passion, it’s simply a too intense period of my Stardew Valley farm life.

Anyway, good news:

  • A¬†book featuring me has been published!
  • Financial Independence Week Europe (FIWE) 2017 has been announced! I’ll be there for sure during the 3 main days and probably few days more to hang out with bloggers and participants! Follow the link if you want to join us! We’re going to Timi»ôoara¬†(Romania) in September 2017!

How was your February?