Tortoise Happy

They say that time flies when you’re having fun, and I can hardly believe that this is my fifth tax year of investing in a Stocks and Shares ISA!

It’s fair to say that I felt nervous about investing in stocks, and as though I didn’t know enough. I knew I had to take the plunge whilst I was young enough to bounce back from any silly decisions, and had time to learn.

My investing style

To refer to ‘my investing style’ makes it sound like something planned out, but its not as planned as I would like! Basically, I’ve invested an amount monthly (between £50 and £200, which has fluctuated based on my employment status) and now and then, topped up with chunks of money.

We’re not talking huge chunks of money, perhaps £500 here, and £1000 there.

The result has been pretty good. We are definitely in a stronger financial position because, for short and medium term planning, we act like the money in investments doesn’t exist. That means we delay purchases for longer and a less tempted to dip into savings for treats than if we held the money as cash.

On the other hand, this isn’t a ‘how I saved a gazillion pounds in 5 years’ article and I want to make larger contributions to ‘future me’.

Investing aim for 2018/ 2019

I’ve decided to set myself a goal for the 2018/ 2019 tax year. The only goal I’ve had to date is to make a minimum monthly fund subscription (£50), which I was really thrilled to be able to make even during the period where I was unemployed in 2016. Fifty pounds is a lot of money to find when you’re down to one person’s income.

I was going to aim for investing £1000 more this tax year than last tax year (without giving specific numbers, you can perhaps tell I’m quite a way off a gazillion pounds yet!), but to push myself that bit further, I’m aiming for £1500 more instead.

Slow and steady wins the race

Investing isn’t just for wealthy business men, contrary to what the media would have you believe. In fact, there’s evidence that women make better investors than men (reuters.com).

It took me a while to find the courage to dip my toe in the water, and once I did, I made very few mistakes (I learned a lesson from the few I did make), and overall my performance far surpasses what I could have achieved in cash savings.

For me, slow and steady is proving to be winning the race.

What’s your approach to investing, are you doing as much as you want to and what is life looking like for your future self?

You could be forgiven for thinking extreme frugality was going to be a sport in last year’s winter Olympics. There are lots of degrees of frugality, and it takes a lot to win. Except its not a competition.

I’d write about frugality more- I’m pro living below your means- except its a difficult subject to write about without appearing to be a sanctimonious know-it-all. I also know that being frugal is easier if:

1. You have enough money for it to be a lifestyle choice, or
2. You can see a beacon of light at the end of your tunnel

A fine line

I read the most perfect advice on a money forum recently; “There’s a fine line between being frugal and a joyless tightarse”. And that line will be different for everyone.

What seems frugal to you might seem spendy to someone else.

What someone considers a simple pleasure might be a feat of endurance for someone else.

I could profess my frugal prowess by boasting that I’ve never spent money on avocado toast. It’s not exactly relevant, as someone who doesn’t particularly like avocado. Or I could boast about making coffee from home. But living in a town that got it’s first proper coffee shop around 3 years ago, I’ve never had the daily latte habit to give up.

Ask me about holidays, and I’ll look sheepish though. Christmas too, whilst controlled, still isn’t what many would deem frugal. I did once make homemade pickled onions as a Christmas gift, but the cost of kilner jars resulted in it being rather pricey. It wasn’t very joyful either.

Choose your frugal comfort level

If you can enjoy a cup of tea with a thrice used tea bag, that’s great and you needn’t feel like you have to do otherwise But if those posh tea pigs tea bags bring you joy every morning, you don’t have to give them up in the bid to become the Emperor or Emperoress of Frugaltonia. Use your money to enjoy your morning cuppa.

Frugal articles are a great source of new ideas, and just because something doesn’t appeal right now, that’s not to say it never will.

I’m pretty sure (or would at least like to think) that most people who share frugal ideas do so to inspire rather than show off, so try to take those ideas that appeal and leave those that don’t. Every now and then I go too frugal, make myself feel stressed and miserable, and bounce back by spending money on a takeaway. I’ll probably do that dozens more times, but it doesn’t matter too much.

We have one life; it shouldn’t be spent going for a frugal gold (second hand) medal if doing so makes you miserable. What matters is reaching a balance that’s right for me and recognising when something isn’t for me. How do you deal with the frugality competition?

When you start taking control of your finances, at whatever point that is/was for you, there’s a lot of big things you can do.

The first time you switch gas supplier? Kerching! Shopping around for insurances? Kerching! Cancelling subscription services? Well, you get the picture.

Once you’ve gone through your finances with a fine toothcomb three times, it can feel frustrating not to be able to do more. This has especially been the case for me, after a lavish trip for my 30th last year plus a new-to-us car at the beginning of this year. Both purchases were saved for, but I never like to see my savings balance dip, even though they’re there for a purpose.

Nudging your finances

Every now and then, you can still give your finances a nudge. It might not save mega bucks straight away, but over time you’ll notice a difference.

Pay rise? Nudge up your pension contributions and/ or investments

New car more fuel efficient? Replenish your savings or nudge up your investments

Spending less on gas and electricity? Absorb the increase to your council tax bill (And be glad you’re netting off an increased expense)

 

Nudge, then look away

Nudges can take a little while to see satisfactory results. In the meantime, if you’ve automated everything to get on with it, you don’t need to obsess over it everyday. You can get on with your life, safe in the knowledge that your ‘nudge’ is adding up and ready to take advantage of the next nudge.

I’ve actually managed to follow my own advice. Not only have I been ignoring my blog (sorry to anyone who’s missed me), I’ve been ignoring my finances. Now I’ve had chance to look, I can see several of our nudges really taking hold. Proof that I don’t need to let money consume my thoughts in order to keep my spending sensible!