End of the year 2016. Always a great moment to reflect back.
2016 was the year where we started to build our blog. During the past years, we became more and more frustrated on how bank employees treat people and advise them badly. The most incredible event was when I had an appointment made with a financial advisor of a big Belgian bank. When the employee noticed and felt that I fired off some difficult questions, he had two poor excuses. The first one was that he was ordered to advise those funds to all clients. By showing past performance (and keeping silent of the yearly costs), people would buy those funds managed and advised by the bank. They know better, right? When I said that past performance is no guarantee for the future and that I could show him many graphs, he told me the second excuse. He didn’t followed a lot of trainings and then he changed the conversation on what HE personally was investing in. This was simply amazing….
But I am sure that 80% of the people in Belgium just follow the advice of the bank employee advising the most profitable funds or investments for the profit of the bank, not necessarily for YOU! The financial knowledge of people (and politicians) is quite poor.
During the years 2013 – 2015 we worked out our dividend portfolio strategy as executed by many bloggers in the USA and Canada. People in Europe are very unfamiliar with this investment strategy for making money grow. The main reason I think is the lack of a dividend policy in European companies and the poor financial knowledge of people and the stock market. The media is also guilty on this perception as each time the stock market plumbs 5 or 10% you will read about it in the news. When the stock market goes up 10 or 15%, you won’t hear about it…
So time to reflect on our defined 2016 goals.
Our 2016 Financial Goals
We had six SMART financial goals defined. If you don’t understand what SMART means, read here at this page.
- Save at least 10% on average of my net annual income. Achieved
- Increase my net worth with at least an additional €5,000 by the end of the year. Achieved
- Generate €5,000 in dividends or 416 € per month Achieved
- Take over the control of my Mom’s financial situation and clean up the banking fees Achieved
- Continue to save money for my foster child Anisha and her future Achieved
- Prepare the start of my kids dividend portfolio for 2017 Achieved
We have been able to pay ourselves 10% of our salary on an annual basis and as a result also increased our net worth. The stock market has grown to new highs after Trumps election and this also boosted my portfolio with significant (virtual) gains. In addition the dollar gained in strength and almost went to parity with the EURO. I transferred all my EURO’s in dollar when the dollar was trading at 1,4 , 1,3 and 1,2 ratio. The currency gains have helped me enormous to boost my portfolio net worth.
The 3rd goal (increasing my dividend payouts) was quite challenging as one of the dividend quarterly ETF’s decreased their dividend to only 4%. Time to say goodbye and allocate the money to better investments. Portfolio analysis (step 5 in my Financial Strategy – read here) is very important and it is important to say goodbye to a non-performing investment. Don’t let it bleed further in your portfolio and expect things will go up again. Maybe it goes even more down…. We achieved more than 5k dividend on a yearly basis and we are very happy about that!
Goal 4 – Taking over the financial control of my mom was another challenging task. The banking fees were outrageous but my mom didn’t notice. “The bank employee is always right” was a hard belief to fight against as my mom lacks any financial knowledge. If you don’t get the education, you can’t judge the advice given and this knowledge advantage is today abused by banks to advice products for their own profit. It is sad but this is how a commercial company works. Bankers want profit for their bank agency as otherwise they can’t get any bonus. Targets are defined by number of bank products sold. During 2016 I have consolidated all investments on a ZERO cost Internet broker and in December 2016 when the stock market broke through its resistance level, I purchased the first investments who will generate dividend on a monthly and quarterly basis. At the end of 2017 we will evaluate our first results.
Goal 4 and 5 were also achieved. For goal 4 we have on a fixed monthly frequency invested in a KEYPLAN for our foster child. This is the defensive strategy of our Portfolio Strategy. If you don’t know what you are doing and don’t want to learn how to do things yourself, keep it simple and start a fund plan. Don’t put it on a savings account with a return close to 0%. Do you really think you can grow money by doing so? Please… Otherwise start a dividend portfolio strategy with small amounts. For goal 5 we transferred the majority of our EURO’s into Dollars and purchased our first dividend paying investments. We also purchased one annual EURO dividend payer who has the potential to generate also capital gains on the long term. During the year 2017 we will report on our progress for the kids’ portfolio.
I am actually happy with the results achieved so far. You also need to know that my investments also decreased in value during the year of 2016 and that most people would panic and sell all their investments. My portfolio decreased by 20% in value at a certain moment. Scary when you see a lot of red % but I actually added to my investments at lower prices. A stock or ETF that pays you 15% dividend on a quarterly basis and that you can pick up at a cheaper price, why wouldn’t you do so? That is an offer I can’t refuse.
Let’s continue our financial strategy on a consistent way. Read here if you haven’t followed our 5 Steps.
Our 2016 Travel Goals
We do also have a Travel section in this blog. You can read about our three categories of travel that we do here. We had the following three goals for 2016.
- Visit Legoland in Denmark : a dream of my son Achieved
- Realize one of my kids dreams : Swimming with dolphins and learn my daughter to swim Achieved
- Do one week horse riding vacation NOT ACHIEVED
2016 has been quite an exciting year for our travel. The kids have been in two countries this year and my daughter can swim thanks to assistance of Shannah of MovetoSwim. Great teacher! In July my daughter was ready to swim with the dolphins and this session in Malta will always be a lifetime experience they can carry forward in their lives.
Read here our Travel the World Reports:
Personally I have also done two City Breaks which I enjoyed very much. It is always a pleasure to explore a city, relax at the rythm of that town and meet new people.
Read here about my City Break Reports:
Click on one of the above links to see our World Cities experience. Have fun !
The only goal that I didn’t achieve was one week of horse riding vacation. Each year I try to schedule a full week horse riding, the ultimate relaxation in the nature for me. However during the yearI changed my plan and booked a 10 day vacation in Colombia. As I was doing a Spanish course at work, this was the perfect way for me to practice my Spanish. So I booked a 10 day trip to Bogota instead and figured out that horse riding in the nature in Bogota was at least a 2 hour drive away unfortunately. Well, I am never bored and there was plenty to see and do in Bogota also. I did meet a lot of new people, made new friends and will go back soon for a special person I did meet. I enjoyed the warmth of the people, the culture and the Spanish. My Spanish improved incredibly. I call it a “crash course”.
During the year 2016 we did also visit interesting cities in Belgium. It is always a great pleasure to be a tourist in your own country. There are so many beautiful places in Belgium, we haven’t even explored.
Read here our three Belgian cities visit Reports:
This concludes our 2016 Goals Report out. Overall a great year compared to where I was three years ago. If you are not happy, do have the courage to take a difficult decision and put that smile back on your face. You only live once and other people don’t have to understand why. Other people’s opinion doesn’t matter. Make sure you have a great work/ life balance and don’t forget to build your path to financial independence.
Good luck with your Goals 2016 reflection and financial planning.
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