So when I started this FIRE journey, one thing that I learnt early was that financial independence simply meant having enough income to replace your expenses. As a result, at the start of December I decided that I would give You Need A Budget (commonly known as ‘YNAB’) a whirl since I had heard good things from it on other personal finance websites and blogs. I will be using the free 31 day trial to see whether it is something that I want to be using moving forward since it is a subscription based model but many people have told me the benefits they have gained from using YNAB outweigh the cost of it.
So far it has been a great way for me to track where every dollar has been going to and how it compares to how my planned budget. The great thing about YNAB is also that it allows me to track my credit card and other assets such as superannuation, real estate, cryptocurrency and shares however these require me to manually adjust their values which is less convenient than using an Excel spreadsheet or Google sheets to track them using data sources which allow them to update themselves. I guess there’s never a perfect solution, but YNAB is pretty good so I’ll be using it for now.
Anyway, you came here for a portfolio update, so without further delay, let’s run through my current net worth calculations;
Assets: $1,119,595.52, consisting of a mix of shares, real estate (PPR and an investment property), a mutual fund and superannuation.
Liabilities: $678,378.85 which is made up mostly by mortgages for PPR and the investment property, and a small HECS balance from my university studies.
Net Worth: $441,216.27. I know being a mid-twenties male that this is a very fortunate position to be in, but I am what people would call equity rich, cash flow poor as the majority of my income every paycheck goes towards the repayment of mortgages. You are all probably wondering whether I got here with the help of my parents. The short answer is yes. The long answer is that I am paying off their mortgage for them and the only way I was willing to do that is if the house was in my name so hence the large asset base and also large mortgage balance.
Review of the Month
December was an expensive month for me – there was quite a bit of gift giving in December with Christmas presents, a few friend’s birthdays and road trips over the holidays which got me spending a little more than usual. However I don’t regret spending this money, because it is in fact the festive season and it is great to have a nice break from work and studying to recharge the batteries before the new year starts.
The markets took a tumble and the share portfolio isn’t looking great, but I see this as a little kink in the road of long term investing. My focus for the coming year is to continue to pay down my mortgage debt and investing $1,000 AUD a month into the share market so I do not miss out on the effects of compounding over the medium to long term.
Goals for 2019
- Continue to aggressively pay down mortgage debt and find other sources of income (i.e. side hustles) to accelerate this process. I am aiming to debt free before the age of 30 which is ridiculously ambitious but I feel like anything is possible if one sets their mind to it.
- Consistently invest $1,000 a month into the share market without hesitation to build my dividend income stream. Most of my current portfolio is sitting in the Vanguard Diversified High Growth Index Fund (VDHG.ASX) but I have recently revised my asset allocations and chosen to pursue a more dividend (Thornhill) approach to investing. I will be following this by investing my monthly $1,000 contribution towards a listed investment company (LIC ) if trading below net tangible asset value (NTA), otherwise into the BetaShares Australia 200 ETC (A200.ASX) which is the lowest cost Australian index fund out on the market right now as far as I’m aware.
Anyway, that’s it for now. I hope you enjoyed the post – I’m looking forward to sharing many more in the future!
Wishing you all the best in the new year…