December Finances

It goes without saying that December typically is one of the more expensive months of the year especially due to Christmas. There has been no exception to that this year, and oh boy has it been a costly month for me with a multitude of predictable yet unforeseeable events occurring that has really signaled to me the importance of having an emergency fund, raring to be used at a moments notice.

In hindsight I say predictable, yet you don’t know what you don’t know so a few abnormal expenses were made this month including two new tyres, headphones (required for work) and a cambelt replacement. I’ve learnt my lesson and will budget for such expensive going forward. Fortunately, this time round what I had already built in my emergency fund acted as a soft safety net that really helped adsorb the blow.

December has been the first month that I’ve hoarded receipts, and what an eye opener that has been. Of course some of these were just single digit transactions however, over the course of the month I made roughly 50~ individually transactions, now that will have to change.

The Accounts

HoldingsEnd Of Nov06/12/2019-/+25/12/2019
-/+
Total£6,850£8,952

+30.6%

£8,369

-6.5%

Monzo-£2,965-£2,427

-18.1%

Revolut-£265-£79

-70.1%

Lloyds-£16-£3.73

-76.7%

Barclays-£37-£370%
HSBC-£789-£339

-57.0%

Vanguard-£1,070-£1,440

+34.6%

FreeTrade-£615-£735

+19.5%

FirstDirect-£1,200-£1,2000%
Triodos-£1,500-£1,5000%
Cypto (~)-£300-£3000%
Outstanding Invoices-£196-£308

+56.4%

A negative result as a whole for the month, though a few greens do shine through including the gains made on FreeTrade. This is no paid plug, but for those who want to put their foot in the door for Stocks & Shares, then FreeTrade is a great start and worth checking out. It was recommended to me by a friend who is working for a hedge fund – simple and intuitive app.

I started the month by depositing £600 and have finished the month with a solid £735, thats a +22.5% return in 25 days! I’m no expert when it comes to stocks but I day traded two different lots of stocks throughout the month mainly to prevent sticking it all in one place and losing it all. I currently hold some stocks in Aviva & Segro. Segro was actually brought when the account was created so the gains have come from buying/selling Royal Mail, Tullow Oil (made the most of the record dip) and now holding with Aviva. I look to hold what I have now going into 2020. Currently up +3.91% with Aviva and +3% with Segro.

Revolut & Lloyds

Revolut and Lloyds don’t help and paint a bit of red on the table, I use Revolut for accepting payment from my side hustle and i’m slowly on the way out with Lloyds as you can see by the staggering £3.73 that is sat on the account. As for Barclays I do use their credit card from time-time though I won’t look to close my account as currently I hold a H2B ISA there too.

HSBC & Monzo

After receiving £175 last month from the now expired HSBC switch offer, my salary gets paid into this account as the switch offer requirements stated so hence why the balance can be quite volatile. Once it gets paid into here I typically send a bulk part of that to Monzo where I then use the Salary Sorter feature to divide the total into separate pots.

Debts

I currently have a couple of 0% interest debts including:
> £153.92 on Barclays that will be paid off before 15/01/20
> £487.45 on PayPal Finance
– £299.00 – £74.75 pm for 4 months starting 27/12/19
– £185.85 – 9 instalments remaining, can overpay

All items here could have been paid off in full but choose to stagger the payments, in 2020 I look to not use credit for anything unless its a 0% finance deal. The item on Barclays credit was for my room (recently moved out) and the £299.00 item was for a pair of headphones for work & the £185.85 was for a new router when I first moved into my new place back in October. I work in IT, so a fast network was a priority. This router has WiFi 6 so I am fairly covered for years to come as there is currently only one device that supports this technology (Samsung S10) but on a side note the router also looks like a beast:

Image result for ASUS RT-AX88U

Income / Outgoings

Income
Base Pay: £2,075
Side Hustle: £243.75

Savings: £1,475 (Monthly Savings + Monzo Pots)

Outgoings
Receipts : £928
– [£121.18] Health
– [£167.08] Nights Out
– [£89.07] Transport
– [£551] Food + Drinks + Misc
Bills: £475~
Car Maintenance: £380

Crikey, where do we begin? For starters and I know this will not be a new trend for me but anything over £25-50 for a month’s worth of nights out is very much out of the ordinary, before this month I had not been on a proper night out for a good 6+ months so I think I had some energy brewing! I’ll keep a close monitor on this for the months to come.

Food + Drinks + Misc contains a lot of random items from general groceries to household cleaning products to Christmas presents, next month I will attempt to condense and properly categorise purchases so that the data is more conclusive and generally more helpful for me to work from.

Monthly Savings

Within the previous post that established my current financial goals, I mentioned that in attempt to up my net salary saving rate, I had opened a couple of regular savers accounts and look to try and max my contributions each month till the account matures (this is easier said than done!).

PlatformProductStartPer MonthTerm Length
Monthly Saving Total£1,350
VanguardLS10011/2019£150Long Term
VanguardOther11/2019£150Long Term
TriodosSaver 1.75%10/2019£5001 Year
First DirectSaver 5%09/2019£3001 Year
HSBCSaver 2.75%11/2019£2501 Year

As seen above, a healthy £1,350 is being saved out of my monthly pay without any intervention. From looking at my past spending habits, it is best for me to have this automatically leave my account before it is in my maining spending pot for the month – with all of the regular savers having penalties for early withdrawal once the funds are in the accounts they stay there untouched for the length of the term.

Net Salary Saving Rate

Within my Monzo bank account, I have a couple of pots that i’ve created which I would also consider apart of my savings (e.g travel money, emergency ) however minus that and just looking at the amount saved via my net monthly savings, then with £1,350 saved, my net saving rate sat at 65% for December.

I understand this saving rate figure may conflict the info displayed in the first table on this post, the figures were taken a couple days into the month when the monthly regular saving monies had already been shifted around.

Going foward

December has been a right learning curve, i’ve identified a few areas I need to work on and completed my first month auditing my spendings. All in all some people demolish their paycheck before the month closes and I have not done that. Saving such a large amount into regular savers is great, however I’ll need to adjust it month on month and find the perfect balance that suits my needs and that is sustainable. Going forward I may need to lower one of the contributions (potentially one of the Vanguard products I use).

Once pay day arrives on the last working day of the month, I will be able to budget and see what I can do with my funds for the year of 2020 as its clear some changes will need to be made. On my current course, if I deduct my monthly saving total (£1,350) from my salary (£2,075) and then deduct bills (£475~) that equals to £250, then you can see that i’ve not given myself much if any wiggle room, hence why I’ve ended up with less than I started on despite some extra side hustle money + good returns on investments.

Quick Re-Cap:
  • Prioritise Emergency Fund
  • Provide more details on outgoings
  • Monitor certain outgoings
  • Adjust saving rate to find perfect balance

As for this very post, its slightly messy and all other the place but my blogging skills do need some work – all in good time. Any suggestions + tips please fire away.

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2 thoughts on “December Finances”

  1. Nice work on those savings rate (65%) and some impressive figures! For my emergency fund, I’m using Premium Bonds to stash away. Some people are against them though (of course all person preference).

    Always a chance to win something back from them and the money is safe! (It’s also harder to withdraw compared to a standard bank account).

    1. Funnily enough, once one or two of my regular saver accounts mature I was going to explore the possibility of going down the premium bonds route especially if the interest rate on these accounts drop even further – the returns over the course of the year are getting so minute its barely even worth the trouble. There is a small local bank with a 3% interest about 20miles away but you have to open the account in branch, a round trip there is already nipping at 30% of the yearly interest I would receive! Its an absolute minefield at the moment.

      The odds are slim but it pleases the mind more knowing you could get that bit extra back!

      I personally would only start putting a bit of my emergency fund to work in a premium bond once its developed to a size where I can safely split it 60-40 (Premium Bond/Easy Access)

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