No more car payments

Just over 2 years ago, Mrs FmC and I found ourselves in the local Jeep dealership one Sunday morning. We were considering replacing our ageing Ford Focus (which we had suffered a long-running issue with – perhaps that is what made us lose interest in it, looking back), and wanted to look at the new Jeep Renegade.

I am not one for visiting car showrooms on a regular basis, but have to admit that once over the threshold, the lure of shiny new vehicles is very tempting!

Immediately we were drawn to a carbon black model sitting at the front of the showroom, with a giant cardboard cut-out of Batman & Superman standing next to it. On closer inspection we discovered it was a Dawn of Justice special edition – based on the film of the same name. It looked gorgeous! Blacked out windows, black alloy wheels, custom upholstery and a Batman v Superman badge on the back! My inner child presented itself immediately 🙂

What’s more the price seemed reasonable for such a cool looking car – around £20K. There was apparently only 500 made for the UK market – 250 with diesel engines and 250 with petrol.

Mrs FmC loved the Batmobile too (always dangerous when you assign a fond name to something you don’t yet own!) and was encouraging me to buy it.

So, before you could sing “Na, na, na, na, na, na, na, na, na, na, na, na, na Batman!” we were sat in front of a salesman discussing a deal and various PCP intricacies.

To keep things brief (because this is not actually the point of the post, would you believe) we bought the car. We managed to get an excellent deal: a dealer contribution of £2,250, a trade-in against our Focus of £3,000, 0% interest free credit on a 2 year PCP contract, a free boot shelf, a set of premium Jeep car mats and the cardboard Batman & Superman cardboard cut-out1 to boot! All for a monthly payment of £169. Result!

We enjoyed the car very much over the first few months. It was our first experience of owning a brand new car. We felt proud. We enjoyed the more commanding seat position compared to the old hatchback. The speaker system was better. It had built-in TomTom sat-nav. People would notice it was the ‘car from the Batman v Superman film’. But the novelty soon wore off.

As the months passed, I hadn’t realised the effect of not actually owning the car would have on us. We were more cautious where we parked it. Due to the low annual mileage we had been ‘recommended’ to agree by the salesman, we started to worry about how much we would have to pay if (when!) we exceeded it. We didn’t even seem to wash it as much as I would have expected. As it wasn’t ours, it seemed we didn’t have as much pride in it.

Towards the end of 2017 we knew our time with Batty (as it was then named) was coming to an end. Jeep had been in touch by then too. We definitely didn’t want to buy it outright. And unlike the day we first stood in the showroom and signed on the dotted line, we had changed our mind about trading it in for another new model (which is why we only signed up for a 2 year agreement – it seemed like a great idea at the time to have a new car every 2 years).

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The end of the tax year

It’s the last day of the 2017/18 tax year and I’ve achieved my goal. Hoorah! 🙂

I’ve managed to squirrel away £20K in both Mrs FmC and my own ISA accounts.

Due to some cashflow problems (i.e. peer-to-peer loans that didn’t get paid back on time!) I even had to borrow £9K from my parents. I wasn’t happy doing this (and neither was Mrs FmC, for fears of strings being attached) – but needs must. I’ve promised I will pay it back within 3 months (and I am a man of my word!).

I am going to have to tread very carefully over the next few weeks, as I have hardly any cash on hand whatsoever. So I will be deferring as much to next month’s credit card bill as I can. Thank goodness I get paid fortnightly, that’s all I can say! 😉

My plan is to try and contribute the full annual allowance into both ISAs each of the next 4-5 years, until I reach FI. They will then serve as a buffer between when I quit my job and when my main SIPP becomes accessible, 5 years later.

How have you got on making use of your tax free allowances?

Matchbook thieves

This is a precautionary tale to avoid the sports betting exchange Matchbook! Because their service leaves a lot to be desired 🙁

For my matched betting antics, I usually stick to a combination of Betfair and Smarkets. Especially as both now integrate nicely with my OddsMonkey account – making the process of laying bets super simple.

Last week was a busy one in the sports betting world – mainly due the annual Cheltenham Festival. Although I had put my own matched betting on pause for the time being (as I was busy scraping all my spare cash together in a bid to max out my ISA contributions before the end of the tax year), I had spotted a tweet from TFS linking to his Cheltenham preview post. This got me thinking – perhaps there was easy profits to be made..

So I loaded up my Smarkets and Matchbook accounts with some capital using my Mastercard debit card, as both were offering 0% commission for a limited period.

I scoured the OddsMonkey forums and various other posts to find the best offers and got to work each early morning of the 4-day festival. I’m still a novice at this lark but managed to make over £300 profit by the end of the week – which I was very happy with! Thank you ta 🙂

Then the fun began.

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Asset allocation strategy

Following my recent post on asset allocation ideas, I’ve decided how I am going to invest over the next several years.

Our retirement savings will be split across 3 main pots – 2 ISA accounts and 1 SIPP. The plan is that short of other available income at the time, the ISA accounts will help fund the period of age 50-55. I won’t be able to get my hands on the SIPP funds until at least age 55 (and possibly 57, depending on what date in 2028 the government decides to raise it).

I’ve decided to keep things simple to avoid unnecessary costs and rebalancing effort:

SIPP (IWeb) – 60/40 ratio

  • 100% Vanguard LifeStrategy 60% Equity Fund – Accumulation

ISA1 (IWeb) – 100% equities

  • 100% Vanguard LifeStrategy 100% Equity Fund – Accumulation

ISA2 (Vanguard) – 100% equities

  • 10% Vanguard FTSE U.K. All Share Index Unit Trust – Accumulation
  • 10% Vanguard Emerging Markets Stock Index Fund – Accumulation
  • 80% Vanguard FTSE Developed World ex-U.K. Equity Index Fund – Accumulation

The SIPP is the most important to us long-term, because it has the most in it and will be responsible for our long term income. That is why I have stuck to a 60/40 profile for that one. I feel I can be a little more risk tolerant in the 2 ISAs in the hope of greater gains.

February 2018 status update

Where did February go? No idea – but it’s time for another update!

I’m still not sure about the format of these posts. One of the issues is the way I track my finances in YNAB. Because most things in my world are a budget category balance (rather than a physical account balance) I am constantly moving money between virtual pots. As such, I’m not sure which figures I can rely on to accurately reflect my progress. So again I’m not going to worry about it, and instead just post (shoot?) form the hip!

February was a busy month trying to get things in order for the end of the tax year. I’ve decided that my highest priority has got to be making the most of my annual ISA allowance, so I’ve been busy preparing to add the full £20,000 to my recently opened (transferred) IWeb ISA.

What’s more, I’ve decided to try and make the most of Mrs FmC’s allowance too – so want to max that with £20,000 as well! A big ask with such short notice, for sure. I’ve started this one by opening a Vanguard ISA with an initial £5,000 deposit. I’m just not sure where the rest of the money will come from (although I have sold some crypto to help fund these investments and make use of this year’s CGT allowance).

With all this planning I have finally settled on a asset allocation strategy (following this recent post). I have documented it here.

My SIPP and ISA performance have recovered slightly since my schoolboy error earlier in the month, but I’m still down a few points. I am hoping they will get back into the black before I swap to the intended funds for my new strategy.

Matched betting brought in a measly £53.74, mainly due to cock-up I made which wiped out much of the month’s profits.

My P2P loans brought in £259.24, although one loan is in default with interest payments on hold until (hopefully) the debt is recovered. It’s nearly 2 months overdue at present!

I managed to save £1,300.93 so here is the summary for February:

Savings £1,300.93
Matched betting £53.74
P2P loans £259.24
Total £1,613.91