Before I share with you our October 2022 results, as I promised in July 2021, I’ll share with you what we’ve been up to the past month. After that, we can talk about the numbers.
What have we been up to this month?
Personal life positives
Let’s start with the shocking news- No family visits during October 2022!
Now that we got that out of the way, let’s talk about the positives.
There were 2 main Jewish holidays during October.
First, there was Yom Kippur. During Yom Kippur, you don’t eat or drink for 25 hours. I took a day off work (obviously) and locked myself in our bedroom. Lazy FI Mum was amazing and looked after both kids for a whole day (there was no childcare that day).
Then, there was Sukkot. We spent part of Sukkot partly at home and partly at Center Parcs.
Our kids had no childcare between the 4th and the 19th of October! They were home for half the month haha.
My day out with my kids
As our kids were home for 2 (and a bit) weeks, someone had to keep them busy. Lazy FI Mum and I took turns doing that. Actually, it was more of a continuous team effort. Anyway, on one of those days, I took the day off work and felt brave enough to take both kids out for the day.
Note to self: soft play with one very energetic girl (that wants to go upstairs, downstairs, outside, and inside) and one static boy (who’s just learning to crawl) is not the best choice of venue.
Despite my poor choice of venue/activity, we still had a great time and my son loved sitting on my lap outside and seeing his big sister climb the steps and go down the slide.
I was pleasantly surprised by how much fun we all had. We went on the train, to the soft play, and even had a nice lunch together.
Wagamama has (temporarily, I hope) beaten Nando’s as my daughter’s favourite food chain.
Sunrise view attempt
In our home, I do mornings. Usually, both kids are up by 06:30 so I’m mostly with them until they leave for childcare at 07:45. One morning, my son decided to wake up before 05:30. My daughter woke up during the night before so I knew she would probably sleep a bit later. With that in mind, I took my son out to try and see the sunrise in our local park. We were out of the house by 05:45.
We had lots of fun being alone in the dark park, seeing the trains go by in the distance and the ducks swimming in the pond.
In fact, we had so much fun that by 06:50 he was back asleep! it was still dark outside. We headed back home in the dark to find my daughter still asleep.
We’ll try and catch the sunrise next time.
I shared with you our experience in Center Parcs from our February 2022 visit in this post.
In that post, I wrote, “…we had an awesome time, our daughter loved it, and we’ll probably go again.”.
And we did.
This time we went for 5 days (Monday-Friday).
It was so much fun spending time with both of them (laptops stayed at home) and doing different activities with both of them. My daughter is much bigger now and spent a lot more time in the pools, especially the wave pool.
I love Center Parcs, I really do, It’s brilliant.
There are brilliant activities for older and younger kids. The cabins are great. The pools are amazing. Even the supermarket has trollies for young kids, they’ve thought of it all!
Even staying in our cabin was fun. The cabins are in the middle of the forest so if you open the curtain and wait long enough you’ll see some animals run around. We saw lots of squirrels and even a couple of rabbits.
Spending all this time together was a lot of fun and we definitely needed it. Our kids got along great together.
My only problem with this visit is that we ate out too much in the local restaurants. It’s not the money (the whole holiday, including the commute, cost less than £1,000), it was all that fried food. Next time, I’ll cook more food in the great kitchen that the cabins have.
I want to take this opportunity to thank Lazy FI Mum once again for organising this holiday from start to finish, including the train tickets, dates, and activities. Thank you!
The family who lives above us have 3 kids, a boy and 2 girls. The older girl is 12 years old and is our daughter’s best friend. The younger girl is 8 years old and is our son’s best friend. The boy doesn’t care about our kids as much, I was the same at his age, I wasn’t interested in babies.
Anyway, when they come over, we want to offer them snacks but we didn’t have anything Kosher to offer them besides fruit. That was until I found out most of the Yo-Yo bear flavours have a kosher sign on the package.
Being the reasonable, and not at all over-the-top, person that I am, I headed to our local supermarket and bought EVERY SINGLE FLAVOUR.
I invited the kids from upstairs to a Yo-Yo bear party and we made a game out of it.
Without knowing which flavour it is, I let them, and my daughter, taste each flavour (that had the Kosher sign, not all of them did) and rate it out of 10. My goal was to know what they like and to be able to stock up. They loved it and so did my daughter! we had so much fun and I think the tasting party lasted over 30 minutes. It was interesting to see that the flavours they originally said they liked weren’t necessarily the ones they gave the highest score in the blind tasting.
I know you’re dying to know, so I’ll tell you- my favourite is the blackcurrant and beetroot bites (of course I tasted them all).
Personal life negatives
Looking back at October 2022, I can’t think of anything negative and don’t see the benefit of really trying to find something negative.
Money related positives
This month, Lazy FI Mum had some side-hustle income! It’s not her first time, but I’m still very proud of her. She works in HR and offers coaching sessions to help people with their careers.
This section will be corrected after she reads it. If you’re reading these lines, I got it spot on.
Money related negatives
Just like I shared with you that we got overcharged for our rent. I was hoping to get the refund in October but instead, we got overcharged again!
Don’t worry, we already received the refund in November and this issue is now fixed.
October 2022 results- savings rate
Our savings rate for October 2022 was 60.51%.
As a reminder, my long-term target is 40% with 50% being an ambitious target. However, with a new kid and maternity leave, my goal for 2022 was initially a third (33.33%) with 40% being the ambitious target. After this year, it will be back to 40% as the long-term goal.
The “ambitious” goal of 40% was not ambitious. As it seems, we’re almost certainly heading towards a 2nd consecutive year with over 50% saving rate, maybe that should be our goal for 2023 too.
Our (weighted) average savings rate for the past 6 months is 52.04%.
Our 12-month-weighted average savings rate is 57.07%.
Finally, our YTD (since January) weighted average savings rate is 57.76%.
October 2022 results- What was different this month?
Every month something unusual happens. Sometimes it’s a one-off expense and sometimes it’s a one-off income. The fact that this happens every single month amuses me but also makes it harder to analyse the savings rate and draw conclusions. That’s why I also use the 6-month, 12-month, and YTD average figures to “smooth” the data.
Anyway, what was different this month?
In short- childcare, side hustles, holiday, mystery dining, and another rent overcharge
As you may remember, we contribute to our children’s tax-free childcare account once every quarter (every 3 months). Both children’s contributions are in the same month. This causes a huge fluctuation in our monthly savings rates. October 2022 was a “no childcare cost” month.
Any “no childcare cost” month looks better than it really is so you should have that in the back of your mind while going through our October 22 results.
There were actually three different side hustles that brought in income this month.
The first one, as mentioned above, was Lazy FI Mum’s coaching.
The second one was, you guessed it, my Excel tutoring.
Finally, the third one is from a really cool project I’m working on. I’m building/improving the financial models behind the Topia app. Logan, the creator of Topia, was the one who gave me the final push I needed to start this blog as I shared in my post about 1 year of blogging.
As I mentioned in the “personal life positives” section, we went to Center Parcs. I do want to mention that more than half of the actual costs (mainly the stay, commute, and activities) were paid in previous months and didn’t affect our October 2022 results. The expenses that did affect our October 2022 results are the food (groceries and eating out), taxis, and extra activities we booked for our kids.
While I only went on two mystery dines during October, I got reimbursed for 5 past dines. The main one was the VERY posh steak place with a 3-digit budget, which I went to with Lazy FI Mum’s dad. This created a “negative expense” that improved our October 2022 results.
As I mentioned above, we got overcharged for rent. This increased our expenses but will make our November 2022 results look a bit better. Achieving a savings rate of over 60% two months in a row while being overcharged rent in both months is amazing, I’m very happy with that.
October 2022 results- Net worth
In October 2022, our net worth increased by 2.29%. The 2.29% is made of two parts:
- Our actual savings increased our net worth by 1.40%
- Our investments went up in value, which increased our net worth by 0.90%**.
After two months of the market working against us, it’s nice to see it go up a little. That’s only psychological because we’re in the accumulation stage. That means we’re buying and not selling, so market drops are actually better for us in this stage of our journey.
Achieving FI– how far are we on our journey?
Reminder: I set our FI number (how much we need to retire) in July 2020 and update it every month for inflation (I use CPIH* index).
At the end of October 2022, our net worth is 30.26% (September 2022: 29.70%) of that number.
We are once again above the 30% mark. However, it’s still not the highest number we had. In July 2022, we had 30.47%
The 0.56% increase in our FI journey (as a percentage of our FI number) from 29.70% to 30.26% means a real (inflation-adjusted) increase of 1.88% (30/26 / 29.70 – 1)**, which can be broken down into these two parts:
- Our nominal net worth decreased by 2.29% as mentioned above.
- The CPIH index increased by 0.41%, which decreased our real (inflation-adjusted) net worth**.
As you can see, 2 factors are out of our control:
- The market performance (are our investments worth more or less this month?)
- Inflation (are things more expensive than last month?)
As these factors are out of our control- I tend to focus on our savings rate. A 60.51% savings rate, with the rent overcharge, is fantastic.
When can we achieve FI (and possibly retire)?
As I told you in the October 2021 results, calculating an FI date is not relevant for us anymore. We will move back to Israel sometime between December 2025 and August 2026. As my models are split into tax years, that means April 2026 is our relevant date.
Once we move back to Israel, I will either move to “just” teaching (no accounting) or try and keep my current job but part-time.
If anyone’s wondering if moving to Israel will help or hurt our FI journey, I present to you this article:
Tel Aviv named as world’s most expensive city to live in – BBC News.
No need to click the link, the title gives it away. Good luck to us.
In any case, we will not reach our full FI number by the time we move to Israel. Therefore, the only relevant question is…
How far into our journey to FI will we be by April 2026?
Based on my “regular” (which is more like a worst-case) scenario, we expect to be 48.36% FI by April 2026. We are still hovering around (/ just under) 50% mark. I think it’s going to be very close to that benchmark in the end.
As a reminder, this number is based on our UK level of expenses. I don’t know how expensive Israel will be. We’ll need to track our expenses for a few months there to get a better understanding. Also, I will have to learn all the little local tricks (like I learned in the UK) on how to save money, get free stuff, and reduce my tax bill.
The April 2026 model assumptions
My model assumes that only our ISAs, LISAs and pensions (essentially, our stock/equity investments) will generate an annual real return of 4%. Meanwhile, I assume our real estate and cash will retain their real value but not increase.
In addition, I assume no future income from teaching as I can’t reliably forecast how much I’ll earn from this side hustle. That means any future income from teaching will be treated as a pleasant surprise.
Another future income I ignore is my job’s annual bonus. Just like teaching, any future bonus is not guaranteed. That means that if my employer has a bad year, the bonus can potentially be 0%. My model assumes every year (from 2023 onwards) is such a year. Again, any bonus that does come through will be treated as a pleasant surprise.
I know these assumptions are very prudent but I prefer being prudent and positively surprised to “realistic” and having to deal with unforeseen issues.
Well, that’s our October 2022 results, have a great weekend everyone!
*CPIH- “Consumer Price Inflation including owner-occupiers’ Housing costs”. As we are consumers and we own our home- I think this is the best inflation metric for us. You can see the changes in the index here.
** You might get a slightly different number (by 0.01%,). That’s due to rounding. The numbers I share are the accurate ones, the equations are so that you understand the way I calculate the numbers.