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The following is a new profile for the BFS Reader Profile series. Today we are getting to know RIT from Retirement Investing Today. Thanks for participating!
Personal Background
Hello, I?m the owner of Retirement Investing Today, a UK based personal finance blog. I?m in my very early 40?s and currently live in one of the most expensive cities in the world ? London.
I?m sure my personal finance journey started like many others. I graduated from University in 1995 with a net worth of ?0. I worked for a few months and decided that I could afford a car. In hindsight what I really meant was that I could afford to service a repayment loan on a car. A few years later by selling the car (replacing with an old banger) and combining the funds with some limited savings I realised I?d rustled up enough of a deposit for a 95% repayment mortgage for a small first home. In parallel to this I was investing what I now consider to be a small (but probably typical for many people) amount of money into some investments including employers contributions into a pension.
Financial Background
This process was really unchanged until 2007 when my personal finance life changing event occurred. I was preparing some financial documents for a tax return when I clicked that of all the money I was earning I actually had very little to show for it in the form of hard assets. I was effectively working for somebody else. I dug a little deeper and it became even worse. My rate of savings over that 12 years, if continued at the same rate, was not going to see me financially independent for many years.
I was clearly well behind the curve. I decided the right thing to do was to see an Independent Financial Advisor (IFA) who surely would help me sort my financial life out. I spoke to a number of IFA?s who spoke knowledgably about all sorts of options based on my risk profile. Thinking on those meetings I felt that what they were proposing was being made to sound deliberately difficult and also sounded expensive. Disillusioned I decided to take personal control of my financial life and control my own destiny.
Making Changes
Over the next year I read many books, trawled the internet for data and started to build a strategy. In parallel I started to restructure my life and make investments in line with the developing strategy. I made some good decisions and also made some mistakes but by the end of 2008 I had a strategy which is largely unchanged to this day. To hold myself accountable I then started Retirement Investing Today in 2009 where I detail my investing strategy, all my trials and tribulations as well as any market data I am currently analysing.
So what?s the strategy? Many will be disappointed to know that I didn?t find a silver bullet. It?s simply a strategy that can be explained by six words ? Save Hard, Invest Wisely, Retire Early. Let?s look at each in turn.
Save Hard
I have developed my saving capacity to now allow 60% of my earnings to be regularly saved. This has been achieved by making many changes. Some examples include since 2008 I have not increased my standard of living to reflect my earnings. That extra has been deployed to savings.
I have shunned consumerism. I don?t own an Apple iPhone or an iPad. I?m writing this post on an old laptop which still works just fine. My clothes while being clean and pressed maybe don?t quite look as modern as others around me.
My grocery bill is as cheap as it can be. Every year or so I take a conscious decision to buy the cheapest of every item which I then try. Some of these meet my needs and some don?t. The next week I then buy the ones that meet my needs again but buy the next highest priced brand of the remainder. I continue this process until I have the lowest price shop each week.
Invest Wisely
Briefly this is a diversified non emotional mechanical investment strategy that includes minimisation of expenses, taxes and an awareness of the damage that inflation can do to a portfolio.
Retire Early
This is the end result of Saving Hard and Investing Wisely. I define Retirement as work simply becomes optional. I don?t intend to give up and begin watching day time TV any time soon. I like to always present any data in a clear factual chart and so I?ll stick with that protocol today.
My progress towards retirement (I show in % terms and not in absolute as everyone?s situation will be different) since 2007 can be clearly seen. I?ve gone from no chance of retirement until the UK government tells me to a likely retirement in the next 4 years.
I hope I?ve provided a different perspective to that normally seen in the mainstream media. New readers are always welcome over at RetirementInvestingToday. It would be great to see a comment or two from you as I?m very aware of how little I really know and the site is a place where readers and I are growing in knowledge together.
Crystal?s Comments:? Congrats on making changes and saving for retirement!? It has to be hard in a city as expensive as London, but you are well on your way by making it your goal.? Good luck!
If you would like to participate in this series, please follow the guidelines found at BFS Reader Profile and submit your own story. Again, we don?t have any more after this one!? Everyone is more than welcome and you can stay anonymous if you?d prefer. Thanks!
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