After three months in our path to financial independence here is where we stand:
Savings rate: 68%
Very satisfied with our result. We know it is not up to the roof but considering we are living in different countries (and we spend extra money in housing and travel to see each other) we think it is good.
At this point I have to acknowledge Mr. Lyn situation. He found a very good professional opportunity in London at the beginning of 2018 and went for it head first. He has been living very frugally and he is a huge contributor to the saving rate. At home, our families joke that he is like our grandparents in the 60s, going abroad “to make money just to send it back”.
So, publicly thank you Mr Lyn, this savings rate is mostly thanks to you. 🙂 It is temporary, he will only be in London in 2018, but it is actually giving us a good start in the path to FI and it is very welcomed.
Results vs target 2018
Our yearly target is to have €60k invested in different funds. So during the first months most of our savings went straight to our investment accounts.
We are also satisfied with this KPI because we set the target based on our 2018 projections and we are on the right path to get there.
As you can see in the graph below, when we embarked upon this journey in March/April we gave it a good boost. We had most of our savings sitting in our normal bank accounts and we deployed them directly in our investment accounts. After that first push, we continued contributing every month. Once we set the target our monthly savings increased, it is like an extra motivation.
We might reach our target by beginning of Q4 and we are discussing what to do with the excess. We can continue to contribute to our original portfolio or we can go for other options (buy a house, retirement account, etc). As of now we are focused on maintaining this rhythm, and we´ll see what to do with the excess at the end of the year.
Notes about our expenses
When we talk about expenses, there are categories that we won´t be able to improve during 2018 and we need to accept that.
We spend a lot in “housing” because we live in different places thus have to pay two rents. When we are both back living in the same city we will be able to tackle that expense, but there is not much we can do as of now.
The first three months we focused on controlling our spending in leisure and travel. We are aware that we need spend money to see each other (as we live in different places), but we believe there is room for improvement as in the last months we were spending far too much money on this.
In the graph below you can see the evolution of our expenses, and the significant drop in April and May. June was high again for exceptional reasons but we plan to keep those expenses low for the rest of the year