Monthly Report: September 2020

The last few months have been a nightmare, both emotionally and economically.

I had some very expensive building work done at my home and the builders did a very poor job, meaning I had to get someone else in to sort it out and pay out double. In addition, health issues within the family and pressures at work have taken their toll on my mental health and I have been signed-off from my employed work with stress. Fortunately, I have my business to fall back on, so I will be able to pay the bills and still have money left to save and invest but it won’t be as much as previous months. I’m talking hundreds rather than thousands.

The fact that I am still able to maintain my standard of living through passive income, even though I am unable to work has made me feel very grateful for the opportunities life has given me. I would hate to be worrying about being able to put food on the table in addition to all my other woes at the present time.

Anyways, let’s take a look at my financial assets:

ASSETVALUE
Marcus Savings£19,736
Vanguard ISA£5,811
CrowdProperty£3,110
Club Lloyds Monthly Saver£2,800
First Direct Regular Saver£2,400
RCI Bank Savings Account£2,000
First Direct Current Account£1,000
Barclays Current Account£800
Club Lloyds Current Account£280
TOTAL£37,937
Current allocation of assets

NET Worth

Roughly £20,000 of that total is owed to the taxman, leaving a NET worth for my finances of:

£18,237

Savings

I try to keep around a 50/50 split between my ‘safe’ savings and my riskier investments.

I try to squeeze as much interest out of my savings accounts as possible, regularly reviewing them for the best rates. I also keep the money I will have to pay to HMRC following my tax return in my savings accounts to earn interest on money that technically does not belong to me.

I currently have my main instant access savings account with Marcus, two regular savers with Lloyds and First Direct and a 5 year fixed rate savings account with RCI. The sum of all these accounts minus my tax liability is:

£7,999

Investments

My investments have the potential to yield far more than my savings at the risk of losing capital. However, these are calculated risks rather than gambles.

I currently have a stocks and shares ISA with Vanguard and an IFISA with CrowdProperty. The sum of these two accounts is:

£8,921

Thoughts & Plans

I have about £17,000 in my savings and investment accounts. As I stated previously, I try to keep a rough 50/50 split between low-risk and high-risk investment vehicles, however due to the success of my investments, they have crept up higher than my savings. Therefore a bit of rebalancing needs to be done in October to maintain the correct split.

My Marcus instant access savings account is taking a big cut in interest rate (it was originally 1.2% and is reducing to 0.75% in October), so I need to look at switching the provider. It may not seem a big difference but there’s about £20k in this account, so for every 0.1% decrease in the interest rate, that’s a loss of £20 per year!

My main concern for this October is working on increasing the income from my business. I don’t go into a lot of details about exactly what I do here, but it is a great business model that generates passive income, once the initial hard work has been done. I will be earning about £4,000 in October from my business, however this is the high end of a variable income. I’m usually looking at around £3,000 per month and this will fall lower in December, which is always a bad month for me so I will need to have some reserves handy. I am working on increasing monthly profits to an average of £5,000 per month from January 2021.

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