My Mom’s Portfolio : August 2018 Passive Income Report

Another month of checking in on our Mom’s portfolio. My mom decided NOT travel in August but she has a trip planned in September. More about that next month… In August one article from Alison Banney in Australia caught my attention.

Three years ago only one in three retirees in Australia expected to outlive their savings balance, now it’s one in two. New research by Investments Trends has revealed the dire truth that over half (51%) of retirees are now expecting to outlive their savings, up from 33% just three years ago.  The new research reveals Australians are quickly losing confidence in their super and it’s ability to fund their retirement, with just 44% of those aged 40 and over feeling “retirement ready”.

“The ability to accumulate sufficient wealth, potential falls in the share market and regulatory changes to the superannuation rules are all contributing to Australians’ growing angst about their retirement future.” Today Australians who engaged a financial planner were almost twice as likely to put their savings into retirement income products, while those who hadn’t engaged a financial planner spent four times as much on lifestyle expenses such as renovations and holidays.

And how are the Belgians preparing for their retirement ? A survey from Binck Bank was published. 62% of the Belgians are saving for their pension through a fiscal friendly formula. 

Koen Inghelbrecht, professor Investing of the University Ghent says that the minimal 1230 Euro is a small amount to build a future proof pension pillar. The majority of the Belgian population does not have a future financial plan for their pension. The percentage of people that made actually a financial plan, is around 13%.

Only 14% of the Belgians expect to have enough financial means to live comfortable. 70% does not even know how much their future pension will be. So saving for your future pension is definitely needed, however 50% of Belgians don’t have a emergency fund of 6 months savings. But growing your money on a savings account doesn’t grow your capital. 45% of the Belgians say they don’t have enough money to invest. Do they spend it or can’t manage it? The second reason for not investing money is the lack of financial knowledge. This counts for 24%. 12% say they have no confidence in the future.  30% actually believes there will be a new financial crisis.

Actually Binck bank asked in the survey the correctness of 10 statements. Right or Wrong. 46% of the surveyed people failed for the test. 40 % achieved an acceptable result and only 14% achieved more than 8 questions correct.

There are big gaps in the financial literacy knowledge of the Belgians. Especially questions about inflation, the use of a testimony and the taxes for houses scored poorly. The average Belgian doesn’t seem to know much about inheritance rules and taxes…

We also performed the test and scored 10/10. If you are interested in doing the test, click the link at the bottom of the blogpost.

Passive Income in August 2018

During the month of August 2018, we received 119,4$ passive income. We received 513,82 $ options premium but the options trades went against us. 

We closed our options trades for a loss of 1337,03$. So our August month ended in a net loss of 703.81$. Damn… you can read our trade review below.

Here you find the overview of all dividend payouts during the year 2016, 2017 and first months of 2018.

 

The Options Trade Review

We had sold some August and September puts on the tickets JNUG and NUGT, the goldminers ETFs. We sold the strike 12 for JNUG and 21 for NUGT.

The gold price plunged and all the goldminers started to sell off. Actually I could have closed those trades with a breakeven or a small loss but I didn’t execute correctly the trades. I reviewed those trades with my mentor and he summarized my mistakes as follows :

1. Limit your risk and cut the trade immediately when it goes against you. I didn’t do that…
2. Always read the chart and do what the chart says you. Buying a put at 12$ would have been a wise hedge according to my mentor.

Well I paid some learning money here, isn’t it?

Dividend & Options Income Growth 

August was a kick me back month. Last month after 7 months we had 69% of our yearly objective and generated 2.412,80$ cash out of the market. Today we got kicked back to a net gain of 1708.99$. Back to 49%. Well..it is what is and we learned from it ! 

So the goal for this year is 3500$ and we have 49% locked in. Only 4 months to go…let’s see how much we can achieve coming months.

Going forward

The portfolio of my mom got transferred to the new broker and the goal is still to hit that yearly objective. We won’t increase our risks for doing so. Just work out a strategy to get it achieved…focus…focus..focus.

August last year was also a red month for my mom’s and my own portfolio. We are definitely learning from our mistakes. We made at least still 121$ profit from options investing this year…lol. Always be positive and learn..learn..learn. This is a journey.

Thanks for reading.

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Source : De Tijd , Finder