Q3 update – “We have barred the gates, but cannot hold them for long”

“The ground shakes… Drums. Drums in the deep.”

A little melodramatic, but this is what the last month or two have felt like for our net worth. The market has continued to kick our arses and we now have to contend with the value of Pound Sterling (which is what our property is valued in) falling against the US dollar… which is what we measure our net worth in.

Shadow moves in the dark… We cannot get out… They are coming.”

Obviously, we have been enjoying The Rings of Power TV series recently!

Back in Q2

Net worth: $719,501 / Portfolio: $213,504

We have contributed $38,881.50 to our portfolio. Shortbread got her bonus at the tail end of Q2, but we didn’t include it in our last net worth update as it hadn’t hit her bank account by the time we posted. While we’re pretty happy with how much we have managed to invest (while simultaneously paying for some extremely expensive prenatal care and budgeting for the birth of our new son!), the markets have continued their brutal slide.

We’re still chipper about it, but it’s testing us a little all the same. The numbers now look like this:

  • Net worth: $715,665 (-$3,836)
  • House: $419,239 (-$35,461)
  • Retirement Accounts: $37,323 ($25)
  • Portfolio: $245,244 ($31,740)
  • Cash: $13,859 ($-105)

Wins this quarter:

We’re not panicking too much. Our property in the U.K hasn’t actually lost $35,461 of value, it’s pound sterling which is currently taking an absolute pounding. In some ways we feel a little vindicated in our choice to hedge against the $USD for our portfolio rather than trust the lunatics we left the U.K to get away from. We’ll see how all this plays out. We have also been really happy with the plan we have followed over the past few months. We have stuck to our budget and earmarked money for things like pregnancy care. We could never have done anything like this just a few years ago without significant stress and having to stretch ourselves dangerously thin.

We have also snagged some free and cheap baby things from friends and colleagues, which will be saving us a significant amount of money! We have a new cot and baby carrier for almost nothing and a very large bundle of clothes. We’re very grateful to the people who have given them to us.

I’ve also picked up a new iPhone after saving for the last 9 months. This is the first time I’ve had to save for something like this in many years. In typical expat fashion I would just buy the thing I wanted in the past and invest a little less for that month. It’s a minor thing, but sticking with it has made me feel a sense of accomplishment.

Goals going forward:

  • Pay for flights back home for summer 2023

This is something that all expats have to deal with eventually. We haven’t been home since 2019, so it will have been four years by the time we visit. We will also have a six-month-old with us. We’ve decided we want to fly business class. I hate flying and the extra cost doesn’t bother me given our situation. We have the money put aside, we just need to buy the tickets.

  • Continue to increase our cash allocation

Paying for the aforementioned flights has put a significant dent in our cash reserves we built over the past quarter. We have earmarked Shortbread’s maternity pay for this as well, but we would feel safer with a decent cushion behind us even though we have already budgeted and funded all pregnancy related costs. It doesn’t help that we have kept the majority of our emergency fund in pound sterling…which has plummeted. We will keep the rest of the fund in our local currency going forward. Hopefully we can take advantage of the interest paid by our brokerage on cash balances.

  • Being parents

The next quarterly update might see us with a new arrival into our family. If it’s not exactly next quarter, it will be at the very beginning of Q1 2023. We still haven’t decided on a name…

Bring on Q4!