I have the goal...I have the plan...so now what?

I should start this post by apologising to my regular readers for the significant drop off in posts in the last month or two.

Part of this was related to burn out (I was simply trying to do too much at one type) but a lot of it also had to do with the fact that I was simply executing on the plans I have been writing and talking about for so many years.  Planning is something I can write about all day...but execution stuff is boring and actually fits quite neatly into my monthly net worth and expenditure tracking posts.

The good news is that my financial plan is working...

I guess I shouldn't be surprised but the truth is that it is slightly disconcerting when everything falls into place exactly how you expect it to.  I'm saving where I'm meant to be saving.  I'm investing where I'm meant to be investment (and being more active about taking profits and re-investing other opportunities) and I'm spending within my planned goals and budgets.

The one area where I am perhaps a little bit behind is my long running plan to start my own business.  Last year I started Banker's Pitch - a blog about Investment Banking and my original plan was to turn this into an information resource which could then be used as a platform to sell further services and informational products.  Although I haven't pulled the plug yet I'm thinking of re-focusing my attention and efforts elsewhere for reasons I will go into at a later point.

With the exception of the above though everything is tracking remarkably smoothly.

As a quick aside - the expenditure smoothing approach I took to big expenses a few years ago is probably the best financial thing I have ever done.  My wedding is fully paid for more than 3 months out from the big day and saving for the honeymoon is going to be a walk in the park.  We have managed to fund both these massive expenses without ever having to dip into my savings and investment portfolio which is exactly what I wanted.

The bad news is that a working financial plan is...well...boring

Having a plan that is working exactly how you want it to is exactly what you want...but it does tend to be a bit boring.  There is nothing to 'fix', there are no new strategies I'm keen to try at the moment and everything is tweaking around the edges.

That tends to make for a pretty boring financial blog...but a pretty good financial plan.  Half my effort in recent months has been to stop myself doing things for the sake of doing them.  Combined with this is the fact that I'm in the middle of wedding planning (which is the most painful thing I have ever done) which makes me want to focus on my financial life (or anything else for that matter).

So what's next?

My real focus at the moment has been my share portfolio.  I'm getting incredibly uncomfortable with the level the market is getting to and the valuations in markets.  The big problem I have is that I'm already very long cash and I'd rather not hold cash for long periods of time in a low interest rate environment and I can't find any alternative investments I'd rather be in.

Opportunities do rear their head from time to time but it is certainly not the share buyers market that it was 3 or 4 years ago when I was writing lots of posts about what I wanted to be investing in next.

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Importing my Japanese sports car...Step 2: Between the auction yard and the ship

I am importing a sports car from Japan into Australia for a variety of reasons I have outlined before.  In my last post I outlined the process of finding, inspecting and bidding for the car before actually winning my car at auction.

I thought it would be a quick and easy process from that point on...but unfortunately I was mistaken.  The whole importing process turned out to be much longer and far more frustrating than I first thought.

Working out who and what you are paying is far more convoluted than you first think

When I first researched buying a car from overseas I thought I understood all the costs and where all the different fees and services went to.  In fact it was far more complex than I first imagined and if I'm going to be honest I still don't know exactly where all the money went to.

The problem really stems from the fact that when you talk to your car import broker you are talking about a landed and complied cost (that is the cost to actually get the car into Australia and to your door step), back solving all the different costs along the way becomes incredibly complicated.

My car purchase was a case in point.  When I bought my car I was told that I had won it for a FOB (free on board) price of JPY707,000 however the actual price the car sold at auction for was more like JPY597,000.  The difference is approximately A$1,000 and although I knew that auction fees and transport costs had to be paid to the port I certainly couldn't work out how this could cost 1/6th the cost of the car.

Complicating this was the actual person I was paying.  The bill I received actually wasn't from the auction house at all - it was from what looked like a broker operating out of Japan so presumably they put a margin on top as well.

This was only the start of the number of fees that I had to pay...at some point I should add them all up.  You may ask why I didn't kick up a bit of a fuss about the fees I was paying to unknown parties.  The fact is that if I get my car for the landed and complied cost that my broker was talking about I would still have gotten a deal compared to Australian prices...so I kept my mouth shut.

Paying the auction cost involved using a foreign exchange broker

Next I actually had to pay the JPY 707,000 to the broker in Japan.  I had their banking details and I was going to go into the bank

February 2015 Net Worth: $537,000 (+5.5%) and Goal Tracker

I have been doing these net worth posts for almost 5 years now and I am constantly refining the process.  As explained in my last post I have 'reset' my measurement methodology to account for future committed liabilities (like my wedding and honeymoon) to more accurately reflect what my net worth position was.

This is the second month where I have included these future liabilities and is a clean month (i.e. you can compare back to last month easily).  My future liabilities balance currently sits at $65,000 so add this to my net worth if you want to know what I would have been at if I had not restated it.

February 2015 Net Worth: $537,000 (+5.5%)

	Value	% Change
Assets	$966,000	+2.5%
Liabilities	$428,000	-1.0%
Net worth	$537,000	+5.5%

I can't believe the month I just had.  In absolute terms this was the best monthly performance that I have had (outside of months where I am paid my bonus) since I started tracking my net worth.  The best bit is that it was a 'clean' result - there were no restatements or inclusions of big swing factors.

Below I have outlined some of the positive and negative factors which affected my performance.

Positive Factors

• My share portfolio performed incredibly strongly
• Australian shares have had an incredibly rally since the end of the last calendar year and my portfolio benefited significantly from these moves
• A couple of stock specific bets really paid off this month and I took the advantage to sell some of my FKP (now AOG) stock which I have written so much about.  I have sold approximately 1/3 of my portfolio locking in a ~90% gain (although  did crystalise a capital gain which increased my liabilities a bit)
• Additionally the Australian dollar continued to depreciate against the USD which helped my international shares which make up just under 50% of my portfolio
• My employee share plan vested
• I get a significant bump in

Importing my Japanese sports car...Step 1: Buy the car

As some readers of this blog may know - I have been looking to get a sports car for years.  I finally decided to stop talking and do something about it.  After looking for a while and trying to work out what I actually wanted to buy I settled on buying a Nissan Skyline...the only problem being that I had to buy an import from Japan.

I could either buy one that had already been imported by someone else (and run the risk that the clock had been wound back) or I could import one myself (and go through all the hassles that that entails).  In the end I decided to import the car myself and I appointed an import broker to help me through the process (you can see that post here).

Finding the car was much more involved than I first imagined

I had originally planned to let my import broker do all the work.  He could scour the lists of cars coming up for auction and then could contact me when one met my requirements, give me a price estimate and a history of the car along with the results of any tests and the whole process would be easy.

However I got much more involved than I previously intended to be

I love cars and I couldn't help myself - every day I would scour the auction lists on the import brokers website looking for any car that could meet my requirements.  After a while I started to get bored and started to loosen my requirements - I was looking at older cars that didn't have the specifications I wanted in colours I was previously not interested in.

I also started to get a better idea of what specific cars would sell for - after a while I was pretty confident that I could estimate how much a particular car could go for given it's specifications and after taking a look at the pictures.

I found several cars...but they needed to pass muster first...

This is where having an import broker really started to pay dividends.  I found several cars that met my requirements and I would get my import broker to send along a guy to test the car and give a report back (along with photos) of what he found.  Some of them turned out to be duds mechanically while another had a smokers smell (which is something you would never see in pictures)

...and then I came across one which I thought may just be the one

After a few weeks of absolutely nothing and as

You are never too young to have a Will

Recently a friend of mine passed away.  He was very young, not sick and it came completely out of the blue.  He had no dependents, lived at home and like most young people (including myself) he had no will nor had he given any thought (or provided any indication) about how he would like his personal possessions dealt with.

If you have no dependents you don't really need a will...right?

Honestly that was pretty much the approach I had taken until now.  I have no dependents and if I passed away people could do with my stuff as they liked...I'm no longer here and there is no one I need to look after...so no worries right?

As I found out I couldn't be more wrong

Even if we are not 'responsible' for anyone our affairs (especially our financial affairs) still need to be dealt with by someone.  Normally it will be a family member who will step up but essentially you are putting the responsibility on them of deciding what should be done with your things and how it should be split up.

Does your next of kin know what you want done with your affairs and who you want taken care of?  Do they even know how many bank accounts you have or where everything is?  Are you going to create problems for them if you don't have a plan that you have thought through?  Do you care who gets looked after and who misses out?

Honestly these are all very real questions.  It is hard enough to deal with these issues when a family is functional and close (as my friend's family is) however can you imagine if this happened in a family where there was dysfunction (as many are)?

Having a will is the easiest way of ensuring the basics are taken care of

Honestly having a will is the easiest way to ensure that

1. The people and causes you care about are taken care of
2. The person you want to deal with your financial affairs will be the one who does so
3. A reduced chance of fighting and dysfunction occurring on your behalf
4. It doesn't leave your assets and their disposal in the hands of the government (in the event of no will there is a specified order of preference for who receives your assets)

Wills don't have to be incredibly expense.  In some

Resurrecting my alternative coin investments plan

A couple of years ago I wrote about my first foray into alternative investments.  I purchased my first set of collectible coins which were then followed by another set a few months later.  Every month when I get my wage I put away $50 to keep investing in the coin collection with the idea that every few months I will buy a selection of coins.

Unfortunately I didn't stick to my plan...

Unfortunately my plan didn't quite work out. I did faithfully put away the $50 almost every month but when it came to actually buying the coins...well that always got put off for another day.  Honestly the reason was probably that they are such a small part of my portfolio that I just ignored it and would keep putting it off.

As a result I had hundreds that I had allocated for alternative investments sitting in a bank account (earning close to nothing).

...but I am committed to having an alternative portfolio...

I keep tossing up whether this alternative portfolio is worth pursuing it at all.  The amounts I am committing to it are very small and it is rarely going to get a significant amount of my attention.  I also don't want to commit a large amount of money to it because frankly I'm never going to want to be an expert on coins.

However I do

January 2015 Net Worth: $509,000 (-10.3%) and Goal Tracker

As highlighted in my 2015 financial goals, I am changing my net worth and expenditure trackers quite significantly.  The biggest impact on this is the massive decrease in my net worth this month as I start to include future liabilities in my net worth tracker ( I will outline why I am doing this below) however I am also changing my expenditure tracker to a 2015 goal tracker (to account for the fact that I am sharing finances with my partner and can no longer actually track every dollar I spend)

I'd love your feedback on the new format (as well as your views about including future liabilities as part of your net worth)

January 2015 Net Worth: $509,000 (-10.3%)

	Value	% Change
Assets	$942,000	+1.1%
Liabilities	$433,000	+18.9%
Net worth	$509,000	-10.3%

Holy Moly!  Did my net worth really drop by $60,000 in one month?  No...thankfully not, however what I have started to do is to include budgeted future liabilities in my net worth.   

• What are budgeted future liabilities?
• Like most people I save up for big expenses before they come. This year I am saving for a wedding and a honeymoon.  I have already saved for a car but have yet to spend the cash.
• These future liabilities are amounts which I am committed to spending in the future which I believe should be reflected in my net worth today
• Why am I including them in my net worth calculation?
• The problem with saving for particularly large expenses is that my net worth today looks artificially high and continues to do so until I spend the cash I have saved towards it
• Honestly it is going to be inaccurate whatever way I do it but I would rather have a conservative net worth figure which improves as I save for the liabilities than an overstated net worth which looks like it is under-performing when I'm actually doing well
• It requires a one off 'reset' as I include all of these in my net worth
• I have been mentally including these liabilities in my net worth for a while now but had not actually included it in my excel spreadsheet until this month
• Part of this was not wanting to take the pain and hit to my stated net worth (which is silly but hey...I'm proud of my performance) but I finally bit the bullet and did it this month
• The actual impact of this was $70,000 for the month however a great performance over the month made it look like a lot less

Now that we have dealt with that...what else happened over the month?

• I continued to save towards my 2015 goals
• I will provide more detail below but my cash balances continued to increase as I save towards my various 2015 goals
• My share portfolio performed particularly well
• It was actually a great month for my share portfolio which recorded a 1.9% gain for the month.  My portfolio is skewed towards cyclical stocks which did very well this month.  In addition the falling A$ also helped my foreign investments...although this currency play could be coming to an end
• My credit card bill remains frustratingly high
• My credit card bill did not fall at all this month which was frustrating given that it was already at a significantly elevated level.  I have really noticed the difference in my saving focus as I no longer keep track of every dollar

Saving and investing has