Only freedom will do

edinburgher

Karmacat wrote: »

I get the impression that everything's going to come crashing down like a house of cards, the way debt keeps building up

Innate pessimist, moi? How can you say such a thing :rotfl:

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You are not the only one who thinks that way KC, I thought it fitting that the most recent re-post on the ERE blog is one where Jacob asserts that we're reaching the end of a 70 year cycle and that the cheap fuel/fast growth age is over. He talks about adapting to a low fuel world, not hoarding. That said, the American shale revolution will probably postpone that particular party by a decade or two?

On a more positive note, it was interesting to see comments from the bank for international settlements saying that QE has had a minimal effect on inflation and that central banks should push ahead with rate rises. So while I agree that debt will no doubt be having some pernicious influence on the economy that we haven't quite figured out yet, I'd be more inclined to expect eternal? stagnation than collapse.

Edit: He was talking about Kondratiev waves

SuperSecretSquirrel

That's an impressive stooze payoff Ed! £235pm extra income for making good use of someone else's money! :cool:

My pot, at half the size of yours, could return as little as zero a month, or over a million pounds a month... Average luck would see me at just over £20pm.

Mr Average Luck, busy avoiding leveraged investment, is taking a £97pm hit in opportunity cost. I can live with that for now as it's someone else's money I'm playing with, there would be an even higher opportunity cost to not playing the stooze game at all, so current situation is already an improvement over last month.

Be interesting to see what the next two years hold. Perhaps I'll start upping the risk while you start to de-risk! :rotfl:

Karmacat

Just found that blog entry, Ed - that's very much my thinking, I'm a big proponent in other circles of stopping people thinking that the world is going to end. Though personally, a slow collapse that lasts until 2025 is going to be quite difficult for me, for age-related issues. And, um, global war by 2040? Oops. Though I can see cyber issues coming to be called war, properly, I'm afraid.

I may have been working on exactly that for my apoca-novel based in a village near to me

edinburgher

SuperSecretSquirrel wrote: »

That's an impressive stooze payoff Ed! £235pm extra income for making good use of someone else's money! :cool:

My pot, at half the size of yours, could return as little as zero a month, or over a million pounds a month... Average luck would see me at just over £20pm.

Mr Average Luck, busy avoiding leveraged investment, is taking a £97pm hit in opportunity cost. I can live with that for now as it's someone else's money I'm playing with

Mhhh... if we're talking opportunity costs, I think it's fair to look at like for like comparisons, so your opportunity cost is nearer £200, which is walking around money for most of us

Unfortunately for me, I'm an inveterate tinkerer and now that I have seen the stoozing gun on the wall, I had to pull the trigger.

To be honest, I was largely inspired by Mrs E who puts up with a lot in my stumbling progress towards FI. It's a real sacrifice to save 30%+ of gross salaries when one of you works p-t and you have a big (to us) mortgage and childcare. This is my attempt to make it feel a bit less like hard work, I'm probably doing the wrong thing for the right reasons.

On that front, I have just come out of an interview for a post that would slash my pension costs to 1/6th of their current level for the same provision, so if I'm lucky I'll be able to increase my salary through more conventional means

Edit: That should be *our* stumbling progress to FI, she's retiring at 48 whether she likes it or not :rotfl:

Brodiebobs

Interested in the whirlygig Ed, we live on the edge of a valley and v.windy but cant afford/have space for a a 'proper' turbine!

edinburgher

I think I may have caused confusion... a whirlygig! :rotfl:

Greying_Pilgrim

Gosh, I'm out of my depth with terminolgy on your thread Ed - I assumed that 'whirlygig' was a triangular, revolving clothes line.......

But, what I did drop by to tell you was that finally, finally i have got my act together and invested Baby Greying's birth gift money into a S&S wrapper. At present it's just a pot, sitting in my isa, because I don't want them to have access at 18 to this money (they can have access to other accounts, but this is intended for 'bigger' purchases). Anyway, I've procrastinated for too long, but I've been intending to follow your example and get it done a long-time since. So now I have. THANK YOU for unravelling a little of the financial fog for me, and my family

Greying X

Edit: Cross-posted - it was a clothes line!

SuperSecretSquirrel

Good luck with the job! Same provision for one sixth of the cost, wowza, that's either a massive salary or extremely generous employer contributions, or both!! Hope it goes your way!

Are you saying my opportunity cost is that high because the half sized pot is no excuse? I should be able to increase the size of my stooze pot to match? I'm not sure it's that simple... Tried opening a third no fee BT card and was offered a tiny CL, didn't seem worth the bother. Already have cards from the providers of a couple of the other zero fee BT cards available, so doubt I could get another from either of them. Don't think there's much else available. Maybe I should consider low fee cards not just zero fee cards, see if the math works out, but I have a feeling having opened 3 cards already this month I'd be offered tiny CLs or even outright rejected

Edit: My first thought regards the whirlygig was some kind of electricity generating windmillamabob, thought it strange that such a substantial investment was mentioned so casually... It clicked a few moments later!

Brodiebobs

oh dear... that is what I call that a whirlygig... but no-one knew what i meant.. i was told I was wrong its a rotary airer and a whirleygig is a turbine. :rotfl:

But appears i was right!

edinburgher

Greying_Pilgrim wrote: »

But, what I did drop by to tell you was that finally, finally i have got my act together and invested Baby Greying's birth gift money into a S&S wrapper. At present it's just a pot, sitting in my isa, because I don't want them to have access at 18 to this money (they can have access to other accounts, but this is intended for 'bigger' purchases). Anyway, I've procrastinated for too long, but I've been intending to follow your example and get it done a long-time since. So now I have. THANK YOU for unravelling a little of the financial fog for me, and my family
Greying X

Did you invest the money in anything esoteric Greying?

Well done, getting started is almost all of the battle.

SuperSecretSquirrel wrote: »

Good luck with the job! Same provision for one sixth of the cost, wowza, that's either a massive salary or extremely generous employer contributions, or both!! Hope it goes your way!
Are you saying my opportunity cost is that high because the half sized pot is no excuse? I should be able to increase the size of my stooze pot to match? I'm not sure it's that simple... Tried opening a third no fee BT card and was offered a tiny CL, didn't seem worth the bother. Already have cards from the providers of a couple of the other zero fee BT cards available, so doubt I could get another from either of them. Don't think there's much else available. Maybe I should consider low fee cards not just zero fee cards, see if the math works out, but I have a feeling having opened 3 cards already this month I'd be offered tiny CLs or even outright rejected

Thanks SSS, I was offered the job :j

It comes with membership of the local government pension scheme, so yes, extremely generous contributions. The difference between my current (DC) contribution and the DB contribution is over £600/month :eek:

The downside to all of this is that I won't be able to draw the new pension until 68, so this will change my planning for FI quite a bit. The money freed up will probably be split 3 ways between SIPP, ISA and lifestyle improvements.

There's a disconnect between how we're thinking about the opportunity costs and it's entirely understandable, because we are individuals with different risk tolerances, circumtances and credit balances.

I am not saying there is 'no excuse' for the size of your stooze, more that we need to compare like with like if we wish to analyse the respective merits of our stoozing. It's like boasting that your car is faster than your neighbour when you're in a Porsche and he's driving a clapped out Citroen.

We should probably stop talking about leverage, we're both leveraged (i.e. saving/investing a borrowed sum because we expect the proceeds to exceed the cost of the borrowing). I am perhaps doubly leveraged, because I have thrown the specific risks of my different investment classes into the mix as well.

We are also both gambling, just in our own ways. I am gambling on an inflation beating real return from a mix of low quality and guaranteed assets and you are gambling on shortfall risk (i.e. if Mr Average Luck doesn't win the million, his expected return will be even lower than the figures you've shown). Personally I wouldn't bother stoozing for average PB return - money transfer cost - interest to point of BT - inflation. Then again, the fact that it's OPM softens the blow a little.