Sunday, November 15, 2015

Financial Independence Family Budget 2007 -2015. 2015 - $92,814 USD

       We have started our family budget, tracking all expenses back in 2007. Initially it was looked at as fairly cumbersome and time consuming exercise.  However, over the period of a few years we educated and trained ourselves to spend 5 minutes a day  in the evening to record all expenses.
       Now with the statistic we could more accurately predict and plan our expenses. It also  helps to clarify some fallacies and incorrect assumptions. For example, as a young parent when you look at nursery cost you think that over the period of time, as your child grows it will be cheaper. Our personal experience clearly tells that it is not happening, nurseries keep rising fees and even at “low inflation” you are lucky if you keep paying the same prize.  However, enough of that, let’s go directly to figures and who we spent $92,814  vs. previous 6 years.

Thursday, November 5, 2015

October 2015 update ($306,838 +$19987 or +7%)

 Accumulated $4,000 USD as part of my annual saving goal for September
Vanguard Emerging markets is up by $1,545 USD.
Vanguard S&P 500 is up by $4,435 USD
Gazprom shares are up by $13,160 USD
Company shares are up by $1,912 USD
Rosneft shares are up by $1,176 USD
iShares Core DAX are up by 1,209
GBP is up to USD slightly $604 USD
Grand total additions: US$  28,041 USD

Precious metals are down by $614 USD
EUR is continue to fall to USD $7,440
 Grand total losses:  US$  7,219

Saturday, September 26, 2015

September 2015 update ($286,850 -$11,560 or -4%)

Accumulated $4,000 USD as part of my annual saving goal for September
Vanguard Emerging markets quarterly dividends $194 USD or 6% at the current price.
Vanguard S&P 500 quarterly dividends $196 USD or 1.9% at the current price.
Vanguard Emerging markets shares are up by $3,025 USD
Grand total additions: US$  7,415 USD

Vanguard S&P 500 slid down another $740 USD
Company shares down collectively $1,340 USD
iShares Core DAX down $270 USD
Gazprom shares down $13,160
GBP down to USD $3,465 USD
  Grand total losses:  US$  18,975

Tuesday, September 1, 2015

August 2015 update ($298,404 +$ 8095 or +3%)

Accumulated $4,000 USD as part of my annual saving goal for July
Gazprom shares are up 1,320 USD
Gazprom annual dividends   4,542 USD  (USD 0.225 per share).
Rosneft annual  dividends  258 USD  ( USD 0.144 per share)
Precisious metals are up by 733 USD as investors are seeking safe harbor.
GBP is up to USD 2,420 USD
EUR is up to USD 3,284 USD
Grand total additions: US$  16,557 USD

Vanguard Emerging markets are down 5,115 USD
Vanguard S&P 500 collapsed 2,540 USD
Company shares down collectively 807 USD
  Grand total losses:  US$  8,462

Wednesday, August 5, 2015

The Undercover Economist strikes back by Tim Harford

            I recently finished reading “The Undercover economist strikes back” by an English writer Tim Harford. Tim has an education in economics from Oxford University.  Although not very well known outside England is quite popular in it, mainly as a columnist for Financial Times newspaper.
          Aim of the book was to bring macroeconomics a little bit closer to a non-economist in an entertaining fashion.  The book is written like a dialogue between the writer and reader, based on real life examples.  The way topics are presented it has a lot of similarities with  “Irrational Exuberance” by Robert J. Shiller.
          Modern economy for general public is increasingly focusing on psychology, how people react and behave. As example acceptance of the wages falling in real terms, while growing in nominal ones – “money illusion”.  Tom continues on about Bank of England commenting: “ Public trust in the pound is now maintained by the operation of monetary policy”, apparently with a totally straight face.   This basically means that most of modern currencies worth something as long as people believe in it.
          The worrying fact is being a influential economist in his own country the author is advocating having inflation at about 4%, this would help to maintain nominal growth of salaries about zero.

Monday, July 27, 2015

July 2015 update ($290,313 -$ 25,350 or -8%)

Accumulated $4,000 USD as part of my annual saving goal for July
Vanguard S&P500quaterly dividends 186 USD or 1,7% annual rate
Vanguard Emerging market dividends 99 USD or 2,6% annual rate
 Grand total additions: US$ 4,285 USD

Vanguard Emerging markets ETF lost 1,465 USD
Company shares lost 1,300 USD
Rosneft shares lost 1,750 USD
Gazprom shares lost 20,670 USD
Vanguard S&P500 lost 370 USD
Precious metals lost 990 USD
EUR lost to USD 1,940 USD
GBP lost to USD 1,150 USD
  Grand total losses:  US$ 29,635

Tuesday, June 30, 2015

Asset Diversification

Financial independence currency allocation:
October 2011
June 2012
February 2013
June 2015
December 2015*
I wish I could have more direct exposure to USD, however Western European banks do not allow direct exposure to the USD. A lot of the EU brokerage firms excluding products trading on the US exchange rates  as these are non-AFM (Authority for the Financial Markets) registered investment funds. AFM. This is responsible for supervising business conduct, which focuses on providing:
- Orderly and transparent financial market processes;
- Transparency between market participants;
- Due care in the treatment of customers.
So they excluded Vanguard S&P 500 and Emerging markets sold in US on the USA exchanges. I think they are doing it to reduce US tax entanglements with these.
Many EU brokerage funds removed products listed on the stock exchanges in Israel, South Africa, New Zealand and Russia.