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Blog om Penge - blog om at blive økonomisk uafhængig Posts

Status på nettoformue – juni 2017

Der er gået næsten et år siden sidste opdatering om nettoformuen. Meget er sket siden;

  • Et hus et blevet solgt
  • Jeg har skriftet job
  • Noget gæld er betalt af
  • Nogle investeringslejligheder er blevet køb
  • Jeg har justeret nogle målsætninger og har ændret min holdning/perspektiver på nogle ting.
  • Og meget mere;)

Netto formue

Jeg har valgt at bruge størrelsen af min nettoformue som målepunkt for mit projekt. Valget for mig lå mellem mål omkring størrelsen af passiv indtægt om måneden eller nettoformue. Det endte altså med nettoformuen.

 Marts 2017Juni 2017Ændring
Total2.110.597 kr2.273.080 kr+162.483 kr (+7.7%)
Pension248.797 kr258.615 kr+9.818 kr (+3.9%)
Friværdi privat hjem754.630 kr720.000 kr-34.630 kr. (-4.6%)
Kontanter i selskab0 kr135.656 kr+135.656 kr
Ejendomsportefølje 11.046.098 kr1.076.528 kr+30.429 kr (+2.9%)
Ejendomsportefølje 299.870 kr119.768 kr19.897 kr (+19.9%)
Privat-38.798 kr-37.487 kr+1.312 kr (+3.4%)

Hvorfor opdatere dette?

Jeg startede hele projektet tilbage 2013, dog uden at jeg præcist vidste hvad målet var. Fokus var til at starte med blot at opspare aktiver for at skabe en formule. På det tidspunkt havde lige tabt en del penge på et mislykkes projekt og satte mig for at akkumulere min opsparing.

Nu er der gået lige over 50 måneder og drivet er ved at sive en smule. Jeg har ikke et behov for at bruge penge, det ligger mere i at det ekstra arbejde med at investere opsparing er ved at svinde en smule.

Jeg er begynde at overveje at justere målet til et lavere tal (4 mio inden jeg bliver 40 år). Et studie i USA (Dr. Gail Matthews) viste at folk der nedfælder og kommunikere deres mål har væsentlig større sandsynlighed for at opnå målene.

Ved at opdatere bloggen vil det give ekstra fokus på hvor jeg er i forhold til mål…

 

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Started new sports betting money project

I have mention earlier that one of my revenue streams was sports betting.

The first association most people get with sports betting is that it is gambling and per definition the house ALWAYS wins.

This is mostly true but there is a difference between the traditional gambler and the person who invests in sports betting. The sports betting investor can in many ways be compared to the professional day trader or poker player. Every single bet is placed where there there is an edge compared to the marked expectations and the odds on the event. Proper money management is essential also. Exactly the same goes with day trading. The day trader takes a short term position where it is expected that the probability of increase in price is larger than the probability of a decrease.

sports-betting

Why sports betting is interesting as a money project?

Most my money is placed in dividend stocks and apartments. So there are not that much extra cash to invest. This is where sports betting is very interesting, same goes for poker and probably also day trading (I have never tried this).

You don´t really need that much cash!

There are 1000s of matches every week, so betting/investing in a particual sports event is very short term. Here is an example:

  • You wager on 20 matches a week. All these matches are played that particular week.
  • €100 per match.
  • The €100 represents 2% of your bank roll (fairly conservative), so total bank roll is €5000
  • You expect a 105% yield on wagered bets

This gives:

  • 1040 matches per year
  • Total investment per year: €100.400
  • Expected profits: €5200
  • ROI on investment (start bank roll): 104%!

 

For good manament of bookmarker accounts you will not need to have your whole bankroll deposited at the bookmakers. You probably just need a maximum of €2000 in use at one time.

The downfall:

Achieving a 105% yield is extremely difficult and will take a lot of time investigation matches etc. The top sports bettors have a yield of 105-110% every year.

My strategy

I don´t have the time or knowledge to find good matches. I have instead investigated different betting tips sites for good tipsters and found a number of experts who have a long track record of profit. Their predictions are followed almost blindly.

8-10 different bookmakers are used to ensure best odds on the events wagered on. Most bookmakers have sign up bonuses, which can be quite significante – especially in the beginning.

Progress so far (started 5. August 2016).

  • Wagered on 214 events
  • Wagered a total of €9.011
  • Won 121 bets
  • Lost 90
  • Profit before sign up bonuses: €972
  • Yield: 111%
  • Profit from sign up bonuses: $691

Most notable is of cause that the yield has been 111%. I hoped for 105% and cannot expect that 111% will continue over time.

Bonuses from bookmakers will be much lower going forward.

 

Learnings so far:

  • I try not to follow progress every day. There are many ups and downs. Many matches are decided in last minuts etc. hence can be stressfull.
  • Following bank roll management is essential, and I will keep paying conservative and will first consider increasing bet size when I have doubled my bankroll (€2000 in profit).
  • I type down all bets into a spreadsheet every 2 weeks.

 

 

 

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Updated Net Worth – September 2016

(bloggen var indtil midt juli 2017 på engelsk)

Updated my net worth this evening. It is the 4th update this year.

I have a number of savings and revenue streams, which go up and down independently. Therefore I try not to look at this number every month. Only the things I can take action on. 

For example I only look at stocks 1-2 times a month. I focus on dividend stocks and have selected companies I hope to keep for 10 years. Therefore not really any point in looking at day to day developments.

Total net worth is EUR 260.522.  

The goal is EUR 525.000, so I am very close at the half way mark!!!

In May my reported net worth was EUR 227.349, so an increase of 15% in just 4 months.

 Maj 2013Februar 2016Maj 2016August 2016September 2016
Total160.000 kr1.612.492 kr1.719.750 kr1.867.717 kr1.973.015 kr
Pension20.000 kr151.531 kr160.194 kr187.964 kr208.744 kr
Friværdi i privat bolig0 kr667.238 kr667.238 kr773.730 kr786.730 kr
Freelance / konsulent0 kr0 kr0 kr26.240 kr39.765 kr
Ejendomsportefølje 1200.000 kr846.500 kr902.549 kr879.300 kr884.204 kr
Ejendomsportefølje 20 kr35.000 kr57.500 kr57.500 kr101.159 kr
Privat-60.000 kr-87.777 kr-67.731-57.017 kr-47.586 kr

 A brief sum up:
  • Pension: Stocks have been good the last month also I have topped up pension to max out the total allowed per year.
  • House equity: I have not adjusted the value of the house but have paid of some debt and overestimated the tax bill;)
  • Consultant company: there are no expenses in this company, so all revenue is accumulated. Money will be used help pay of debt on apartment this December.
  • Real estate company 1: this company owns the first two apartments I purchased. I have actually lowered the value of one of the apartments. I like to be conservative. The monthly surplus is sent to p2p lending accounts, where I currently receive 12% interests.
  • Real estate company 2: we made a really good buy this month. This apartment was way under marked, so this had helped. Also apartments give a monthly cashflow, which is added to the value.
  • Private account: at its best for many years! The sports betting project has help here also I am saving a lot of money after I sold the car. Howevery my private account probably won’t go any lower because it is mainly contains my student loan. This load is practially free, so that is the last debt I will ever pay back;)

All in all I am happy to see the possitive effect of multible income streams. I have to find some addition streams to reach my target before I am 40. If all assets just cash flow as they should (no help from Mr Marked) I will be approximately EUR 100.000 short of my goal. Since you cannot count on Mr Marked I will have to find that extra earnings from somewhere else.

 

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Income & expenses statement April 2016

The income statement for April is now ready!!

Income April

Salary after tax: EUR 3.105
*Holiday allowance after tax: EUR 2.839
New company payment to pension: EUR 644

Total income: EUR 6.588

*In Denmark all full time employees receive 12,5% of their salary in holiday allowance. It is kind of a forced savings. This is paid out the following year when on vacation. It is possible to have this paid out once a year. That is what I have done this month.

Expenses April

Joint expenses with girlfriend (rent, utilities etc): EUR 671 (down from EUR 800 last month)
Food account: EUR 268
Car mortgage: EUR 170
Car insurance: EUR 95
Insurance: EUR 28
Gas for car: EUR 20
Fitness equipment and physiotherapy fee: EUR 49 (last month)
Coffee, alcohol, food out: EUR 6
Vacation: EUR 422
Clothes: EUR 17
Extra health insurance: EUR 40
Total expences: EUR 1.845.

So total savings rate is: (EUR 6.588 – EUR 1.845) / EUR 6.588 = 80%.

The 80% savings rate is mostly because of the extra pay. But without this my monthly savings rate was 50,8%, which is over my 50% target.

Two things are very interesting here.

  1. Car is now sold! So this will have a massive effect from Juni
  2. I seems like I really spend a lot of money on vacations. From January to April I have spend EUR 1266 on vacation…

Quick note on vacation. Of all the things money can be spend on I have always considered vacation something you should not save money on. However these month statements makes me realize that it could have a large impact on the savings rate.

 

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Nettoformue – maj 2016

Så har jeg fået opdateret min nettoformue. Det er første detaljeret opdatering, hvor alt tæller med.

Mit mål er at akkumulere en formue på 4 mio inden jeg er 40 år. Det beløb mener jeg er tiltrækkelig til at skabe løbende afkast, så jeg ikke skal “arbejde” længere.

Opdateringen giver en total værdi af aktiver på 1.612.492.

Tabellen opsummerer værdien af de forskellige aktiver:

 Maj 2013Februar 2016Maj 2016
Total160.000 kr1.612.492 kr1.719.750 kr
Pension20.000 kr151.531 kr160.194
Friværdi i privat bolig0 kr667.238 kr667.238 kr
Ejendomsportefølje 1200.000 kr846.500 kr902.549 kr
Ejendomsportefølje 20 kr35.000 kr57.500 kr
Privat-60.000 kr-87.777 kr-67.731

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Income & expenses statement March 2016

 

The income statement for March is a bit delayed. Would like to post this statement in the beginning of each month.

Income March

Salary after tax: EUR 2.558
Newspaper subscription refund: EUR 207
*New company payment to pension: EUR 644

*For simplicity I will add this to monthly income. The money will be taxed when I withdraw (when I am 65 years). Money is automatically invested in a world stoct index. Cheapst index they had.

Expenses March

Joint expenses with girlfriend (rent, utilities etc): EUR 671 (down from EUR 800 last month)
Food account: EUR 268
Car mortgage: EUR 170
Car insurance: EUR 95
Insurance: EUR 146
Gas for car: EUR 20
Fitness membership and personal trainer: EUR 49 (last month)
Coffee, alcohol, food out: EUR 14
Books: EUR 64
Interests: EUR 18
Other items: EUR 1
Vacation: EUR 671
Total expences: EUR 2.147.

So total savings rate is: (EUR 3410 – EUR 2.147) / EUR 3410 = 37%.

So again of the 50% target. This month it was mainly because of vacations and the car.

In total I am now currently EUR 1029 of the target of a 50% savings rate. It is actually very easy, the car has to go. My plan is that I had to be put of for sale before May 1st.

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Income & expenses statement February 2016

I would like to keep a better track of my private spending. A great way is to update every month and evaluate income and especially the expenses.

Actions so far

This is my second update and have already found a lot of thing I could save money on. This is what I have done so far:

  • Cancellation of membership at the fitness centre (EUR 47 every month, 3% of my total expenses). I will instead work out outside or inside if there whether is bad. There are a lot of outdoor spots where you can work where I live.
  • Must admit I spend around EUR 25-35 on my Nespresso machine every month. So I will not buy new capsules for some time…
  • I cancelled our newspaper. We get a Danish version of the Financial Times every week. This will save Eur 17 every month.
  • For music I have used Spotify for some years now. This is cancelled now, so we only have Netflixx at the moment. Spotify costs EUR 13 every month.

I think that is all. While these seem as small items they actually add up to over 3% of my income and over EUR 1.300 a year.

Income Februar

  • Salary after tax: EUR 3.150
  • Payment for car miles (work related): Eur 108

Expenses February

  • Joint expenses with girlfriend (rent, utilities etc): EUR 671 (down from EUR 800 last month)
  • Food account: EUR 268
  • Car mortgage: EUR 170
  • Car insurance: EUR 91
  • Gas for car: EUR 170
  • Fitness membership and personal trainer: EUR 29,4
  • Coffee, alcohol, food out: EUR 19,4
  • Books: EUR 11
  • Clothes: EUR 269
  • Movie: EUR 10,5
  • Gifts: EUR 24
  • Other items: EUR 17

Total expences: EUR 1.652.

So total savings rate is: (EUR 3150 + Eur 108 – EUR 1652) /  EUR 3150 = 49,3%.

Very close this month. However it is easy to see how I will get above the 50%. The car expenses corresponds to 20% of all my expenses.

Also this month I used some money on clothes, however this will keep me going for some time now.

 

 

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Income & expenses statement January 2016

So have just checked my bank account for income and expenses for January 2016. My top goal for 2016 is to pay of the last part of the loan towards our house. Currently EUR 19.463.

One of the ways to achieve this is by lowering my spending. I in general find it much easier to lower spending than to raise income;)

In this statement, I only consider my personal finances. So do not include my companies (apartments and consultancy work).

Income

  • Salary after tax: EUR 3.212

Expenses

  • Joint expenses with girlfriend (rent, utilities etc): EUR 805
  • Food account: EUR 268
  • Vacation: EUR 227 (payments towards a vacation in April)
  • Car mortgage: EUR 170
  • Car insurance: EUR 91
  • Fitness membership and personal trainer: EUR 421
  • Coffee, alcohol, food out: EUR 38
  • Books: EUR 25
  • Clothes: EUR 27
  • Movie: EUR 3
  • Other items: EUR 1

Savings rate: 34,1%

Hmm, this is much lower than my goal of 50%;(

Quite disappointed about this.

Actions

This is my first month with income statement and this shows exactly why this should be done. I see myself as a very frugal individual. But looking at the numbers I can see that I don’t save as much as I want to.

Joint expenses with girlfriend. We looked at these spendings and can see that we can lower this with EUR 134 from March. Reason being that we no longer have a dog.

Food account. We can save some money here. We have decided that I go to a different supermarket (Lidl). Also we will make larger portions at a time and thereby freeze some food for other days.

Car expenses. 12.3% of my expenses is because of the car I only use once a week. There is only one conclusion here. I will have to sell the car if I want to achieve my +50% savings rate. By far the easiest way to lower my expenses. I investigated the matter and I actually have more debt in the car than it is worth. Debt is approx. EUR 10.000 but the value is only around EUR 8.000.

I have not made the final decision yet.

Vacation. Of all things, I think that vacations are key to happy living. Will have to see if I can attain my goal even with vacations.

Fitness membership and personal trainer. I have had a bad back for 1 year now. So have invested some money in a professional personal trainer for 3 months, quite expensive EUR 362 per month. Will unsubscribe the membership at the gym. That will save me EUR 50 per month.

The rest of the expenses are rather low. So for now no reason to change these habits.

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Going for a Chris Ferguson Poker Challenge

In my bucket list I have listed that I want to succeed in my own version of the Chris Ferguson Poker Challenge.

What is challenge about?

Chris Ferguson is a professional poker player who back in 2007 turned a zero USD poker account into $10.000. He did this by grinding his way from freerolls to micro level poker tables and gradually playing higher levels when his bank roll allowed it.

His principles:

• He was not allowed to play a table with more that 5 percent of his bank roll. This number was 2 percent for larger poker tournaments.
• If he made winnings at a table, he would have to leave this table if the amount represented more than 10 percent of his total bankroll.

It took Chris 7 months to build a bank roll of USD 6,5. All most 10 months later he reached USD 10.000.

My project

I will make some adjustments to this strategy. First of all I will start with a no deposit poker bonus somewhere. This will give me 5-20 USD and thereby same me at least 7 months;) Also I will set a lower goal. I expect that the skills at the higher tables will be too high for me and hence take me very long time. The target will be EUR 2.000 which is amount I spend on a new dividend stock.

My point is also to prove that you can make a relaxing recreational activity into a profitable project that can help you to financially freedom.

Also if this project is successful and I enjoy playing, then EUR 2.000 actually represents more than expenses I have for a whole month. This meaning that I could repeat this once a year and have 10 pct of my yearly expenses covered through a recreational activity.

First obstacles is TIME. We have just founded our Adwords consultancy business, so extra time has to go towards this project.

 

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Happy day! We just purchased another rental apartment.

My brother and I have now completed the purchase of our 3rd apartment.

I will in this blog post go through the  numbers.

Purchase price: EUR 126.846

Initial puchase costs
Title fees: EUR 1.109
Lawyers fees: EUR 461
Estimated rehab costs (worst case): EUR 6.200

Finance
Private loan for the full amount EUR 127.517 (4,75% in interests rate)

Monthly cashflow
Expected rent: EUR 872
Interests (first year) per month: EUR 505
Taxes: EUR 19
Estimated common costs: EUR 156. This includes savings for future repairs, insurance, and some utility.

Budgeted profit before taxes:
Cash flow pr. month: EUR 177
Return on investment (financed): 27,33%

Return on investment if cash financed: 6,42%. This equals a cash flow of EUR 679 per month.

All a decent return for an apartment in a central location in a larger town in Denmark. The apartment also has some appreciation potential , something that is not budgeted for. The seller purchased the apartment at the top of the marked back in 2008 for EUR 172.483. So 36% higher than our price. The marked has recovered in the two largest cities in Denmark, but there will still go some time before we are at the same prices in other cities. I recon at least 5 years or more, but as mentioned we a buying for cash flow so we are not budgetting with any appreciation.

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