This month’s key phrases:
– Don’t try to time the market!
– Think slow – act fast!
– My bucket is smaller than Warren’s
– Don’t forget to smell the roses
– Avoid an accidental Gammon
– I like crisps
1 Bank Balance
Today I made and actioned quite a big decision. I sold a chunk of an index fund and will put the proceeds towards my mortgage. Time will tell whether it was an act of arrogant, ill-informed market timing, but it also won’t, and I can rest easy knowing I made a reasoned decision to do what I did. I have the luxury of looking at this differently: I have been pre-occupied with paying off my mortgage for some time now. And when I say preoccupied I really mean boring myself and wishing I could think about something a bit more interesting. So I prefer to think that I have acted upon a long held thought process by cashing in this corner of my portfolio. If the market goes up significantly from here, I can rest assured in the knowledge that a) I made a reasoned, non-hasty decision for good reasons b) I still have plenty in the market enjoying the gain. If the market slips I get to do a Buffett and catch some of gold it’ll be raining in my own bucket (a significantly less voluminous bucket than Warren’s of course). Of course, the markets is a long game, so frankly who cares what the market does next, I’m young and in it for the long term. What I can tell you is that when I put the phone down I felt good. Viscerally, it seemed to me that I had made a good call. I know we’re not supposed to be emotional about money but it’s not so easy to be like that in practice. Without giving too much away about the structure of my loans this upcoming mortgage payment will have a disproportionate effect on reducing monthly outgoings. Smaller monthly commitments = less stress = more fun time dad.
Of course, this decision doesn’t increase or decrease my net worth in itself. What it does do is reduce our monthly commitments as a family and therefore move us more quickly into profit for the month – every month – where money can be allocated towards activities that further increase net worth (paying the mortgage or buying equities).
This month has, co-incidentally seen an increase in net worth as a result of good equity market performance.
We’ve also had a reasonable month in the business and are moving nicely towards the stated goal of having six months worth of expenses set aside, so that for the six months that follow that particular milestone, I can a) relax a bit b) save towards having an even more significant cushion c) plough more into net worth enhancing activities d) really not be in a tight spot in the event of a genuine economic shock situation (eg recession leading to a slowdown – which I would certainly be affected by).
So overall, without breaking any world records the financial picture is pretty good on the earning front. I’ve played good defence by taking a call to reduce my monthly commitments, and Mr Market has been good to us too.
I continue to be very happy with my diet and exercise regime. I’m running a lot and running pretty well. This weekend I ran a 10k in a time not seen since I was running more in my twenties. I have got to be happy with that!
The continued commitment to exercise has helped develop the virtuous circle effect of helping me each my diet (fewer crisps – mmmm crisps) and hardly any boozing (ahh boozing – I don’t miss it much but as a Brit feel contractually obliged to tuck in every now and again).
The calf, which you’ll remember from April’s update continues to play up but I’m bravely and stupidly ‘running it off’ and it’s actually getting better. The pain is in the Achilles Tendon and seems to go away once I’m warmed up, be rather painful after a run.
More than one person talked to me about weightlifting and the importance of strength exercises for men of my vintage (over 40 Peter Pan types). So I have made the call that after the summer when I have a couple of running races planned I’m going to have a go at more weights. I’m actually looking forward to it and it will be a big change having spent my sporting life in team and endurance sports.
I also went climbing – its bloody brilliant!
As mentioned in the Bank Balance section, my positive response to informing my fund provider that I wanted them to sell a holding and send me some cash was greeted with a spontaneous sense within me that this was good news. Time will tell whether – mathematically – I made a good call, but I’m good with that and get to be happy about the day in May 2018 that I reduced my monthly outgoings as well as my mortgage debt.
Work is a bit less dull than I reported in May. I can’t say exactly how or why but I’m in good shape, tending to derive more joy and meaning than I did earlier in the year. One thing I am sure is having a positive effect on my attitude at work is that I am working hard to do a bloody good job. I know I can do a good job, but I’m pushing myself a bit harder – and it seems to be having a positive effect nohow I feel about my work.
I wasn’t lying when I wrote earlier that I was boring myself a bit with thoughts of mortgage payments and net worth. I’m in a good spot financially and am going to work on being a bit less obsessed. It’s interesting how focussing on something can get in the way of it being fun. I really am enjoying my running, the results I’m getting and the mental and physical benefits it is undoubtably bringing. However, through getting more serious about it I am actually enjoying it less at the time. Not many months ago I’d craft little jokes in my head (one day I’ll tell you the one about Heath Ledger), think up interesting concepts to write about here, and make some good decisions about work and life in general. More recently I’m focussing on the run – looking at my pace and trying to break previous records – rather than letting my mind wander. I’m going to try to get back to enjoying the running for the sake of running and measure it all a bit less. Similarly, while I firmly believe its important to make good financial decisions (big and small) I want to enjoy life while I’m in the process of engineering a better life. In short, I need to focus on smelling the roses!
Another good one for Mr MB3. Thanks for reading! Enjoy the summer and don’t forget to wear sunscreen – we don’t want any accidental gammon faces round here!