Category Archives: Monthly update

Networth

Networth Update – 12/2020 (December)

Welcome to the December Networth update! Last one of the year 2020. i will be doing another post on how we matched our 2020 Goals so I will be focusing as usual on how our month went.

December

Yup..we kinda left several routine check-ups to the last month

Fear not! We are both healthy 🙂 We just some had some high extra expenses this month due to some routine exams and consultations. Since they happened last in the month we havent got any reeimbursment yet. I’ve also went 2 times to osteopathy consultations and that alone were 100€. Yeah..i’m not doing so many sports has i should and that reflects in some ocasional back pain.

We also got my anual bonus with an extra company bonus this month which is always great.

Mrs.Firecracker enrolled into a course and the first year tuition is ~700€. We took advantage of paying the whole value and getting a 10% discount.

How about the rest?

Christmas was nice! Except for the fact that we couldnt join all our family members due to COVID, nonetheless we still managed to pass the 24th dinner with my parents and 25th with Mrs.Firecrackers. Our nephews got to enjoy opening gifts many times and so did we. This year i’ve given to my family a list of books that i’ve have ordered (7/8 books) and they could donate whatever they felt like. They all managed to get funded and i received them all as a christmas gift.

Another Reno round

There are now some threads regarding the new building we bought.

1- Construction: We had a meeting with the architects and finalized the “final version” and the “possible version”. They will now discuss the budget with the contractor and see if that is still inline with the first estimation we got. We need to keep a leash on the 150k threshold.

2- Tax gains “Mais-valias”: Here is the tricky part. I’ve now contacted a fiscal laywer to help us figure this one out..so apparently since in our contract we didn’t state exactly that our capital was coming from the sale of the house i’ve done in the past, the Portuguese IRS considers that between the money we put in – 136k – each of us gave 50% of it. Which is not the case…we are trying to see if we can get to put that small sentence there…not sure if this is possible.

Additionally, they also exclude taxes and banking fees from the capital we put in and only consider the cost of the property minus what we got financed, in this case 355k-242k = 113k. This amounts to almost 23k! Yes of course thats not a cost. Why would it be? Its cheap change right? I need to keep pragmatic while dealing with the IRS…thats how they get you, if you get emotional it wont help..

Savings Rate

On the savings rate part we managed to save ~26% of our income which is lower than usual and could definitly be improved. Something to do after the rental building is finished. For 2021 i antecipate a lower savings rate as stated in previous updates since our investment building is currently not generating any income.

December Summary:

1) Extra expenses : 700 € the course, 200€ above our eating out budget and 400€ more on health expenses.

2) Projects: So i’ve finally got the payment from the invoice i’ve given back in July (YEY!!!) The hardest 200€ i’ve ever waited…guess being an entrepreneur will have a lot of this…I’ve also gotten +500 € from a keynote i gave in an university in December.

Now, coming to our monthly networth…

Summary:

Our Networth value for December is 456 587.61€ (+2 599.40)

Assets:

Investment accounts

  • ETFs Portfolio: 30 315.94 € (+383.94)
  • Retirement Accounts (aka PPR): 16 961.03 € (+612.23)
  • Certificates Deposit + Emergency Fund: 52 599.28 € (+ 811.13
  • P2P Portfolio: 7 546.99 € ( – )
  • Total Investment accounts: 107 423.24 € ( +1 807.30)

Real Estate (Based on Market Values)

  • Primary Residency: 300 000 €
  • Farms: 70 000 €
  • Rental House: 414.500
  • Total Real Estate: 784 500€

Cars

  • Mr.Firecracker Car: 20 000 €
  • Mrs.Firecracker Car: 18 000 €
  • Scooter: 1 500 €
  • Total Cars: 39 500€ (=)

Total Assets: 931 423.24 € (+1 807.30)

Liabilities:

  • Primary Residency: 189 163.60 € (-349.21)
  • Rental House: 285 672.03 ( -442.89)

Our Networth drilldown looks like this:

You can follow our Networth status always here

Networth

Networth Update – 11/2020 (November)

Welcome to the November Networth update! Restrictions over COVID increased, Christmas paycheck and renovation options!

November

14th Paycheck – welcome! In Portugal our anual salary is divided in 14th installments.

Usually June and November are extra income months since we have our 13th (vacation) and 14th (christmas) paycheck months. Its a strange thing here in Portugal to have that separated but i figure it was for some time the only way to make some people account for extraordinary expenses and it was just easier to make it mandatory from a “bonus” in former times. I found this nice website with all info if you are curious.

How about the rest?

This was a soft month. Not much happening since we have now mandatory curfew after 1pm on weekends and at 11pm on weekdays. Nonetheless, we were able to go twice for brunch. As law abiding citizens we adapt :). Crossing between municipalities is also restricted to certain days but i was able to drive to our farm and get some oranges to the whole family.

Reno short update

In the renovation side we got several proposals from the architects which lay down different scenarios for each apartament. Its just the first step. We have now given an overall direction and we saw that some of our concerns (with contructions not legalized) are much lower. This happens because whatever was built in the Lisbon municipality prior to 1950 is considered legal! Lucky us…

We liked a lot some of proposals that consider more light to come in and to take advantage of the view adding to some nice terraces!

Savings Rate

On the saving rate part we managed to save ~43% of our income, considering that we are already including some christmas gifts. This means that we are able to offset last months 0% and slightly increase our annual savings rate to a whopping 36,25%. yey!

A nice scenario is that if we remove the christmas gifts and also the extra paycheck this would mean this month we would be saving ~500€, in line with my estimations but lets have that confirmed next month. Anyhow the conclusion would be that those 500€ means slashing our savings rate in half to ~15% per month instead of the 30%. I will save some of this conclusions for the next year planning.

November Summary:

1) Extra expenses : 504 € in gifts, 2 family birthdays and christmas gifts (the most expensive ones). There should be some other expenses more in the next month. We are still far from the 25th.

2) Projects: Waiting for the payment on 2 invoices (200€ from July and 2.000€ from October).

Now, coming to our monthly networth…

Summary:

Our Networth value for November is 453 988.21€ (+7 150.94)

Assets:

Investment accounts

  • ETFs Portfolio: 29 932.00 € (+1379.59)
  • Retirement Accounts (aka PPR): 16 348.80 € (+917.73)
  • Certificates Deposit + Emergency Fund: 51 788.15 € (+ 4 061.84
  • P2P Portfolio: 7 546.99 € ( – )
  • Total Investment accounts: 105 615.94 € ( +6 359.16)

Real Estate (Based on Market Values)

  • Primary Residency: 300 000 €
  • Farms: 70 000 €
  • Rental House: 414.500
  • Total Real Estate: 784 500€

Cars

  • Mr.Firecracker Car: 20 000 €
  • Mrs.Firecracker Car: 18 000 €
  • Scooter: 1 500 €
  • Total Cars: 39 500€ (=)

Total Assets: 929 615.94 € (+6 359.16)

Liabilities:

  • Primary Residency: 189 512.81 € (-349.12)
  • Rental House: 286 114.92 ( -442.66)

Our Networth drilldown looks like this:

You can follow our Networth status always here

Networth

Networth Update – 10/2020 (October)

Welcome to the October Networth update! Bigger expenses! Investment renovation, 2nd wave of COVID and some housing extraordinary expenses.

Renovation

Renovation
Lets see if we can have that

After the signing of the deal we have booked an architecture firm to work on the project. In a first phase we tough that we would be having them just for taking accurate measurements of the place but we decided to book them for the entire process which will cost us 11k total.

I dont want to transform the article into a renovation deep dive but as you can imagine this is quite an important topic for us (and it helps me to lay the steps by writting it…)

The first 3 months will be for planning components:

a) Close the final solution – 1 month

b) What materials to use and a detailed list of tecnical designs and items to use – 2 months

c) Contractor selection and price comparison – Should be quick (we have already a contrator who helped to calculate the costs of the project and ideally we would continue with him since the prices are in line).

Their first estimate put the construction costs to 155k + taxes which is inline to the estimate we got from the contractor 155k vs 158k.

COVID19 – second wave (October)

COVID numbers PT October
Biggest number of infected people in one day – 4656.

Something that also started impacting our lives has been COVID’s second wave hitting Portugal and propelling our numbers to new maximums. This made restrictive measures to take place and we had to find innovative ways of being able to spend birthdays and events with our friends. For now we dont expect any impacts in our finances.

Unfortunetly this month we had several expenses which were even bigger than our income thus putting our savings rate to 0% this month. Expenses with the renovation will be increasing transforming cash into asset value (hopefully 🙂 ) and i’m not considering them in our operational monthly expenses since we have a separate account for this.

Our totals savings per month should now decrease with the new morgage from ~1200 € to about 500 € per month. Which means if we have an extra expense like a new huge bookshelf this will set us back for the month.

With this months 0% savings rate we have now a yearly savings rate of 35% which is still bigger than 30% we have put as our goal for 2020.

October Summary:

1) Extra expenses : 515 € bookshelf, 120 € for cleaning of the farm. Cleaning service costs for our apartment were also bigger since we have +1 week this month.

2) New house: Gardener + architecture signing contract = 2k.

3) Projects: No update here.

4) P2P world: Nothing new

Now, coming to our monthly networth…

Summary:

Our Networth value for September is 446 837.27€ (-2 214.19)

Assets:

Investment accounts

  • ETFs Portfolio: 28 552.41 € (+313.84)
  • Retirement Accounts (aka PPR): 15 431.07 € (26.01)
  • Certificates Deposit + Emergency Fund: 47 726.31 € ( 3 293.18
  • P2P Portfolio: 7 546.99 € ( – )
  • Total Investment accounts: 99 256.78 € ( -3 005.35)

Real Estate (Based on Market Values)

  • Primary Residency: 300 000 €
  • Farms: 70 000 €
  • Rental House: 414.500
  • Total Real Estate: 784 500€

Cars

  • Mr.Firecracker Car: 20 000 €
  • Mrs.Firecracker Car: 18 000 €
  • Scooter: 1 500 €
  • Total Cars: 39 500€ (=)

Total Assets: 923 256.78 € (-3 005.35)

Liabilities:

  • Primary Residency: 189 861.93 € (-348.74)
  • Rental House: 286 557.58 ( -442.42)

Our Networth drilldown looks like this:

You can follow our Networth status always here

Networth

Networth Update – 09/2020 (September)

Welcome to the September Networth update! We bought a house! And we are getting closer to FI!

Awesome view from the balcony ! My phone did most of the work here.

The news are quite fresh, we signed the deal last week and the adventure is just starting. We now have the whole remodeling to do 🙂

This month we took 2 weeks vacation and came again to the beach house, i’m doing an online course and horse riding everyday while Mrs. Firecracker is lecturing remotely. Oh and we also try to enjoy our vacations ahah. Another great opportunity to grill some nice food.

Sorry Vegan friends.

We also had Mrs. Firecracker birthday this month and i’ve had some surprises lined up . Mostly we are trying to hangout with friends in open spaces still minding the COVID situation and we did some splurging in eating out. We had to celebrate the contract signing right?

Our goals for 2020 seem to be very well on track, our savings rate is at ~37% (objective was 30%), our networth is at 449k (optimistic objective was 435k) and company revenue of 10k (currently at 700 €). The last one seems to be most challenging but i will keep pushing. You can always check our progress here.

September Summary:

1) Minor adjustment on the portfolio.

2) Saved 6% of our income only (213.53€ / 3493.38€). We had a spike in our Eating Out section.

3) New house: Huge networth increase. We have bought the house for 355k + Aquisition taxes (~19k) thus totalling ~375k. We will now be owing the bank 242k + 45k already given for the construction part. According to the bank the house is valued at 414.5k which is the value i will be putting prior to construction. This means +39,5k netwoth increase ! We have now hired the architects to start working on the project.

4) Projects. No update from the projects but i got paid 500 € for a keynote i gave last month.

5) P2P world: Nothing new

Now, coming to our monthly networth…

Summary:

Our Networth value for September is 449 051.46€ (+37 117.84)

Assets:

Investment accounts

  • ETFs Portfolio: 28 238.57 € (348.41)
  • Retirement Accounts (aka PPR): 15 457.08 € (4.61)
  • Certificates Deposit + Emergency Fund: 53 560.78 € ( 54 877.59
  • P2P Portfolio: 7 546.99 € ( – )
  • Total Investment accounts: 102 262.13 € ( -55 230.61)

Real Estate (Based on Market Values)

  • Primary Residency: 300 000 €
  • Farms: 70 000 €
  • Rental House: 414.500
  • Total Real Estate: 784 500€

Cars

  • Mr.Firecracker Car: 20 000 €
  • Mrs.Firecracker Car: 18 000 €
  • Scooter: 1 500 €
  • Total Cars: 39 500€ (=)

Total Assets: 926 262.13 € (+323 769.39)

Liabilities:

  • Primary Residency: 190 210.67 € (-348.45)
  • Rental House: 287 000 ( – )

Our Networth drilldown looks like this:

You can follow our Networth status always here

Networth

Networth Update – 08/2020 (August)

Welcome to the August Networth update! Networth increase of 1.5k with 2 weeks of vacation 🙂

I’ve been waiting a bit this month hoping i could announce the ownership of the house we signalled but its taking more time than we wanted. Anyhow i could also tell you about what we have been doing in August in the meantime!

We took 2 weeks off in August spending 1 week in an amazing 5* hotel in the east of Portugal next to the Spanish border and another week 1h north of Lisbon next to the beach.

We decided to take advantage of a 50% discount in the Hotel and visited several towns in a close range (~40km) and also did a full day in the Montargil lake with some fishing included. Pretty awesome.

We passed here on the first week (Marvão) – check it out

On the second week we wanted to keep the expediture on the low side so we decided to stay North of Lisbon in a small apartment Mrs. Fi

recracker family owns next to the beach. We have mostly cooked instead of eating out since we have a small space for grilling and also splurged in a few things like a 2h horse ride in “Serra da Archeira”.

Visitar | Torres Vedras na Primeira Linha | Rota Histórica das Linhas de  Torres
Some wind farms on the hill

Overall our vacations came to 2.1k which were a very nice value for 2 weeks. We will be taking 2 weeks again this month and staying in the same place. All the money we can save for support the reconstruction of the house.

Status on the House

On the hourse front a lot happened. The bank we were working requested for a signed document from us and the constructor saying they would deliver the 110k construction. Problem with this is that the budget we provided was an estimation and the constructor didnt want to commit to this values and deliverables. We were then presented with 3 options:

a) Change construction company

b) Only do the buying without the construction part

c) Try another bank

Options a) and c) seemed to far fetched for us. They would require a lot of time and we wanted to sign the contract in the second week of September. We were also not very positive that another construction company would commit without doing several visits to the house and that another bank would be able to lend us the money without this formal commitments. We wondered everything. How in the hell can anyone do a house credit with construction if the process is so freaking hard??

We definitly felt we were out of our league and prepared to go for option b) and leave the construction part to a later stage. We didnt want to forfeit the 35.5k we have already given as a signal. But this would also create problems in the long run. We had to be able to finance the construction anyhow.

But…sometimes you strike luck. A contact i had been pushing aside that negotiates credits with banks showed confidence he could help us. Since we have a strong track record in many banks and a solid income i’d never considered to be in this situation..

Thankfully thanks to this contact we were able to get the credit fastly pre-approved, got another budget for the construction (194k with VAT), did the evaluation for this other bank and got approved 174.9k for construction releasing 45k on the signature. Option c) turned out to be viable! As i’m writting this we are waiting to be contacted to schedule the notary and the ownership agreement.

August Summary:

1) Portfolio swings, now up, another month down..

2) Saved 27% of our income (1073.54€ / 3890.25€). Since we budget for vacations we can continue to save up despite of the value spent in vacations.

3) Projects. Currently with 2 side projects but with very little news since my last post.

Project A – Consulting project for a major telecom player. Progress: It was decided to move forward with a showroom project which we will be billing (me and my partner) 2k for this.

Project B – I’m doing IT consultancy for a digital agency and we are still waiting for the furniture company to sign the official start of the project.

4) P2P world.

45.1) Wisefund – Nothing new. Some comms from Wisefund but no interest or principal returned yet.

4.2) Mintos – Nothing new…some people claim that interest is being paid but unfortunetly i have a lot still on hold in Monego and nothing got paid..

4.3) Monethera – still same. Nothing new.

5) New House: Adjusting the math with the significant increase on the needed repairs. (110k -> 174.9k)

Projected income:

  • Attic – 500 €
  • Ground floor (2xbed) – 800 €
  • Basement left – 600 € (larger area)
  • Basement right – 600 € (larger area)
  • Sub-basement right – 700 € (has a private part of the garden)

Total: 3 200 € (Gross)

The costs we will have are:

  • Mortgage -1000.06 € (all costs included)
  • Anual tax – 12.5 € (150 / 12)
  • Rent income tax – 896 € (3.200 x 28%)

Total: 1 291.44 € (instead of the former 1 425.7 € )

We still have some factors that might influence this like apartment occupancy (good rule of thumb is 80% calculation) and emergency nest for repairs. Even in this case we will have 5 years warranty on the construction.

We will also hire an architect which will oversee the construction, help to choose the best materials, maximize potential and plan for selling one (or more) of the fractions if we want to.

Now, coming to our monthly networth…

Summary:

Our Networth value for August is 411 933.62€ (+1 556.86)

Assets:

Investment accounts

  • ETFs Portfolio: 28 586.98 € (+709.17)
  • Retirement Accounts (aka PPR): 15 461.69 € (+808.76)
  • Certificates Deposit + Emergency Fund: 105 897.08 € ( 311.09
  • P2P Portfolio: 7 546.99 € (+ 1.85)
  • Total Investment accounts: 157 492.74 € ( +1 208.69)

Real Estate (Based on Market Values)

  • Primary Residency: 300 000 €
  • Farms: 70 000 €
  • Rental investment: 35.500 (signal given for the preliminary contract)
  • Total Real Estate: 405 500€

Cars

  • Mr.Firecracker Car: 20 000 €
  • Mrs.Firecracker Car: 18 000 €
  • Scooter: 1 500 €
  • Total Cars: 39 500€ (=)

Total Assets: 602 492.74 € (+1 208.69)

Liabilities:

  • Primary Residency: 190 559.12 € (-348.17)

Our Networth drilldown looks like this:

You can follow our Networth status always here