Saturday, 1 July 2017

(FI36,11) EDIT:FI34,98

The English speaking countries of the world have just dragged the financial markets of the world into volatility and decline. Yes, you should be sorry Canada, and no, it is not all right, mates down under, but still, you are not the main culprits.

So when counting my assets this morning, logging on to all bank accounts, pension institutes and including the money in my wallet, it is clear that the value is a lot less than it was just a week ago. But also a lot of bids for shares at ridiculous prices have gone through on the market, looking good for a possible future. I am  not overly concerned, it could be the traditional summer vacation/intern activities and the markets have been very-very-very hot the past half a year or so. Most financial bloggers have reported all time high and my assets have rolled through all predictions like a steam train on crack.
So it is cooling down. Take some time in rehab.
I have margins.

With my frugal lifestyle, careful spending and unusual set-up, I indeed have margins. The margins are a financial independence value of 36,11. (NO, IT ISN'T, SEE BELOW) Meaning all my assets (except the value of where I live as I always will have to live somewhere and pension rights which I can not control or touch) divided with my annual budget, would last me 36,11 years. (NO, IT WON'T, SEE BELOW.) This includes a hope that interests, value increases and dividends will cover the cost increases and inflations of the future. I have six months of emergency funding on a savings account and the rest in funds, stocks and locked savings.

It is easier to live frugally when there is a cushion to catch you if bad things happen, to deflate when the pressure increases and to pump back up when nothing unusual happens and most certainly to spread the annual payments over the different months of the year.
It is well worth continuing to live frugally after the hard dog years are past and the savings cushion is pumped up.

I am very grateful to my younger me who did not spend the well earned high income on socks and doughnuts but on education, property and shares.
I will do my best to make my older me equally proud of me.

EDIT: I AM A NINCOMPOOP, A DING BAT AND A NILLY WILLY and I can't count before breakfast. Financial independence number is actually 34,98 (I had included pension-money so it wasn't wrong, it was just wrong because I never do as I can't touch them. The incredibly high FI-number bothered me the entire day and I just recounted. I am a fool. So now you know. 

2 comments:

  1. You are very wise to have and maintain that savings cushion. It can sure help you sleep better at night. And yes, poorly performing markets are NEVER Canada's fault, lol. We're too small potatoes to have that kind of influence.

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    1. False modesty, dear Canadian. On the raw materials markets, you are big fish!

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