Well it’s time for the first of the new monthly share and net worth reviews. I’ve decided to keep this separate from the main budget post so I can dive a little deeper into the details if required.
Over the coming weeks I’ll post how “I” calculate net worth and why I choose this way of doing it. Until then the internet can then cast aspersions about my level of intelligence.
This month £63339.32
Last Month £47262.75
Growth on last month 34.0%
I received my annual pension summary report today which is main reason there is such a big jump in net worth this month. I can choose to log on to an online account and check the pension monthly. The big jump that I get by having the statement on a yearly basis is more preferable for me. Over the past year the average monthly contribution to pot has been £572.33 giving a total of £6868.03.
The total pension investment growth over the year was £4125.67 which is okay but obviously I’d like substantially more.
The net worth growth rate of 34.0% for a month is clearly the largest I’ve ever had. I suspect unless something magical happens one of the largest I’ll ever see.
Going forwards In terms of the amount of money I’m saving into the pension I’m in two minds. Firstly it’s a tax free way to save which is great. It means paying less tax on my wages and it’s invested straight away giving substantial compound growth. The negative to this is you can only start claiming your pension up to ten years before the national retirement age. This currently 65 although by the time I get there I suspect this will be somewhere around 70. With my aim to be retiring a long way before that then this poses a significant problem. I won’t be able to access that cash until around 60.
On the other hand I could keep the money in my wages and not put it into the pension. I would miss out on my employers contributions and the benefits of the money being free of tax. However I would be free to invest the money in any way I see fit rather than the pension companies investments. Also I would be free to start utilising the money whenever I chose.
It’s an interesting quandary that I’m in. I figure I will still need money when I’m sixty and onward so it gives me a little leeway to spend a bit more of my other money before then knowing I’ll be guaranteed(ish) more later. Therefore…… I’m going to up the contributions again at the first opportunity. It’s a once a year decision with my company so it will be sometime in the new year.
In terms of other specific changes, the only money I owe to anybody currently is my mortgage to the bank, all credit cards are clear. I have a new IHG card which I need to use to get some free points. We only need to spend £200 over 3 months so I’ll just use it for food shopping and any DIY extras.
I continue to add £500 per month to my share account (just on funds, no individual shares) and I have another £500 saved into an emergency fund.
I’m not sure if I should invest any of the spare money I have into one of my side hustles. Business does seem to have gone a bit quiet but the store was closed for nearly a month due to my trips to China and Florida. I know it’s not passive income if you have to close it to travel but its free money so I don’t care.
Last Month’s Value £15414
This Month’s Value £16398*
Growth on previous month 6.38%
*I take £500 off this month’s value as I have invested that amount extra since then. I don’t want this to skew the growth percentage.
All of my individual company shares did well this month, all but one exceeding the total average growth rate for the month. Galliford Try (Discussed here) did particularly well due to the announced dividend increase and the limited effect of Brexit (so far).
The funds did not fare so well. I feel they may now begin to under perform for the near to medium term. I’m expecting a significant drop in the world markets soon I know I’m not the only one to say this. With the US market “overpriced”, Deutsche bank struggling and interest rates so low we may have a perfect storm for a significant drop. That being said, IF and when this does happen there will be a significant buying opportunity which I fully plan to take advantage of.
Do you think there is an upcoming drop in the market or will the bull continue to charge for the foreseeable future? What should I do with my pension?