November 2017 Update

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November is over, it is time for another monthly update.

November 2017 was not bad in terms of savings, but a bit lower than I was expecting. The savings rate for the month is 14.25%. It’s not perfect, but still better than last month. My objective is to go to 25%, but probably will need a raise to go there (I’m still gonna try without the raise).

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First deposit at DEGIRO and first ETF investment

Posted on Categories Broker, ETF, Investment3 Comments on First deposit at DEGIRO and first ETF investment

After having opened my DEGIRO account recently, it was time to use my DEGIRO account. My first deposit reached my DEGIRO broker account! Let’s start with the good, there is no fee for transfer! I’ve transferred 1000 CHF and exactly 1000 CHF arrived in my account. I was afraid of a hidden fee or transfer fee.

With the bad now: The transfer took 8 days. I sent the transfer Friday 17th, the bank debited it from my account Monday 20th. It only arrived today, Tuesday 28th on my broker account. I’ve contacted DEGIRO several times in the meantime to ask about the whereabouts of my money. They did have an issue with their bank (CIC Bank, Basel). The bank was not transferring the money statements to them for about a week. So, normally, this should not be so slow. I’m inclined to give them the benefit of the doubt for this one. I’ll see what happens to my second transfer. I sent it yesterday and it should arrive tomorrow on my DEGIRO account. If this issue is something that happens regularly, this is really bad thing for DEGIRO, but we’ll see.

Update (6 months later): I haven’t had any more issue of that sort with DEGIRO 🙂

With some part of this money, I bought 13 shares of Vanguard Total World Stock ETF (VT) at 73.16 USD. This ETF is a passive fund that holds 7955 stocks in the entire world, weighted by capitalization. It contains around 50% of the stocks from US and the rest is from the entire world. The fund contains 2.6% of stocks from Switzerland. It has a very low Total Expense Ratio (TER) is 0.11%, which is very low and absolutely fine for me.

Since this ETF is in the list of free ETF offered by DEGIRO, I didn’t pay any fee to buy the shares. Nevertheless, I paid a small fee for the currency conversion. I paid 0.19CHF on an order of 936.80 CHF, which means a fee of 0.02%. This is pretty good since I was paying around 0.5% fee for funds on PostFinance 🙂

The buy was pretty easy do on DEGIRO, no issues here. At first, not very clear, but it turned out quite OK. I’ll post more information on the future on how to use DEGIRO. I received a mail notification for both the deposit and the trading transactions. Everything seems fine.

I’m not totally sure on my final portfolio, but VT will definitely be a part of it and probably a large part at that. I’ll keep you up to date as soon as I update my portfolio.

Save 53CHF per month by asking for a reduction of rent!

Posted on Categories Budget, Frugality, Spending, Tips3 Comments on Save 53CHF per month by asking for a reduction of rent!

I just got confirmation from my building manager that they accepted the reduction of rent that I asked for. They answered more than two months after my request… My base rent goes from 1175 to 1122. This will only start at the next term of my lease, on April 1st. But this means that next year, I’ll save 53 CHF * 9 = 477 CHF.

In Switzerland, rent prices are indexed on a reference interest rate. When the interest rate goes down, you can ask for a reduction of your rent. Unfortunately, this is not an automatic process. You have to ask yourself to your house owner or building managers. On the other hand, you can be sure that if the interest rate rises, it will be an “automatic” process… Switzerland is very good to the rich. It makes it easier for them to stay richer 😉

Don’t forget to check if the interest rate decreased since you signed your lease. If you haven’t asked for a reduction in many years, this could be a large reduction! There are lots of models online for this, such as the calculator from ASLOCA or the one from Comparis.ch. You should really not hesitate doing this, it’s in your rights. They cannot refuse to reduce the rent, it’s in the law. The only reason they would have to refuse would be if they had made improvements to your apartment that would raise its value.

You can find the most recent reference interest rate on the admin.ch website (in French/German/Italian).

Overall, I’m still quite happy, this is more than 50 CHF per month saved next year! The rent is often the biggest item in a budget. At least, it is the case in my budget. Therefore, it can be very interesting to reduce it. But, it’s not always possible. If the reference index rate decreases, it is a nice opportunity to cut this large expense!

What about you ? Do you have any saving tip ? Did you find a way to save on your rent ?

Opened a broker account on DEGIRO

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After reading a lot about funds and low-cost index funds in particular and the inefficiency of most actively managed funds , I decided I will stop giving my money to fund managers. Therefore, I decided to start investing in passive index funds and not active funds. Moreover, I also decided to only focus on no-load funds. Currently, I was investing with PostFinance funds, but the Total Expense Ratio (TER) of these funds is high and PostFinance is charging a 0.5% percent load on each buy of funds.Since we don’t access to excellent mutual funds such as Vanguard funds here, I decided to invest in Exchange Traded Fund (ETF) versions of the funds. This means I need a broker to invest. I looked at the trading offer of PostFinance but it is insanely expensive.Therefore I decided to find a new broker with significantly lower fees.

The links to DEGIRO are affiliate links. If you use them to create an account, you’ll receive 20 CHF in transaction credits and I’ll also receive 20 CHF.

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October 2017 Update

Posted on Categories Budget, Monthly1 Comment on October 2017 Update

This is the first monthly update of my budget  and finances on this blog. I’ll try to do this every month and normally earlier than this (I was in vacation).

October 2017 was not really good in terms of savings, but a bit better than I was expecting. The savings rate for the month is 8.15%. It’s not really good but I was expecting a loss, so it’s not so bad.

Even though I was in vacation in China, this is not what made my budget so bad. The only really expensive stuff was the plane tickets but they were paid earlier. I had to pay almost 600 CHF for dentist and 450 CHF for Billag. On that note, I really hope the “No Billag” initiative will pass next March, that would be a very nice improvement to my budget, especially since I don’t watch TV and don’t listen to the radio.

Update: Unfortunately, Swiss people seem to like taxes and rejected the initiative

I have started to review my portfolio with better investments. I still have around 60% of my assets in cash, 11% in international stocks, 10% in domestic stocks and 17% in bonds. I plan to decrease the cash this month, especially for my retirement savings third pillar.

November should not be very good since I have to purchase new plane tickets to China, but this will hopefully be the only big expense of the month and therefore the  savings rate should be better. I plan to be very frugal this month. I also plan to reduce a few of my monthly expenses (more on that later). I will check again all the expenses on my budget and try to come up with solutions to reduce the overall spend that is still too high.

What about you ? How was your October ?

Birth of this blog

Posted on Categories The blog4 Comments on Birth of this blog

Welcome to this new blog 🙂

This year has been quite disastrous for my savings. This is due to many big expenses such as plane tickets and unexpected health care. But this made me realize that I’m not saving enough at all. Although I have a good a salary and live quite well, I’ve a tendency to spend too much. Last year, my savings rate was around 18%. This is not really bad, but still lower than I would have liked. But this year, my savings rate is down to around 7%. This is way too low and made me realize that my expenses are way too high. Moreover, the last two months have been negative months although not by a long shot. This month is also likely to end up being negative.

Since this point, I started reading many personal finance blogs and websites. I’ve learned a lot of things about investments and spending. In the coming months, I plan to put theses lessons to work. My main change now will be to reduce my spending. I’ll then continue to learn about investments and I’ll try to put my money to work.

For some context, I’m a 29 years old computer scientist. I just finished my Ph.D in Computer Science and I’m still working in my school. I live in the rural area of the Fribourg state, in Switzerland.

I’ll mostly be writing this blog to motivate myself. I’ll try to share some monthly reports and some information I’ve found.

And don’t forget I’m not very good with my money, so don’t follow everything I do, but you may try to learn from my mistakes.