Previous blogs:

Setting my FIRE number 2021 update, when can I retire early?

Setting my FIRE number: when can I retire early? (2020)

Interested to follow my progress? Follow me and join me on my Roadtrip to Financial Independence!

By the end of 2019 I had 50% of my cash un-invested.

By the end of 2020 this was still 47% (at least my cash stopped growing!).

I’m ending 2021 with only 21% of my cash un-invested. I expect this will be even lower by the end of 2022.

I believe that in 10 years automation companies will have taken over 25% of the jobs. The easiest way to be part of this revolution is by having shares in those companies.

Since I started to invest aggressively I noticed I am reaching Financial Independence faster and faster. Also this year I am recalculating my retirement date. I have explained in detail in my (end of) 2021 update how the Belgium retirement system works, but I just want to recap a small part. Basically the longer you work the higher your retirement would be. This is a line of how much I would get depending of the year I would stop.

You can see that if you work until 67 that even then the retirement money is not so high, only 1934 EUR. Additionally 67 is quite late. By the time you will actually have time to do what you want not only will you barely have enough to survive, you will also have an age that probably comes with a few health driven restrictions.

The second thing I wonder about is, is this sustainable?

Currently the Belgian population pyramid looks like this:

By 2050 it will look like this:

Or in other words in 2022 we can see that 19.8% of the population is over 65 and by 2050, my official governmental retirement age, 28% of the population would be over 65.

At the same time the debt of the Belgian government is the highest in 15 years. It was on the rise even before covid.

So how will the government pay for 50% more retirees? They can raise taxes, lower pensions by 33% or increase the retirement age.

We already have one of the highest taxes in the world so we might not decide to go for this solution.

You should not allow yourself to be in a position where the government or anyone else decides on whether you should be working or not. Take control and start on your Roadtrip to Financial Independence right now!

The fourth pillar: personal investments

In Belgium there is three pillars of retirement. Ignore them. Instead go for the fourth pillar and decide yourself when you want to retire.

Every year I calculate (or rather let excel calculate) my personal Financial Freedom date based on this Fourth pillar. I do also include the other 3 pillars in my calculation, but they take up only a minor part of the target date.

In my investment plan I invest at least 800 EUR monthly in the fourth pillar.

I am also assuming a growth of 6% per year for this porfolio due to compounding interest.

Lets calculate my FIRE number

2019-2020 Recap

In 2019 I calculated that my FIRE number was 983350 and I was 3.7% along to FIRE. This was based on my current portfolio and a yearly expense in 2019 I had of 29501 EUR!

In 2020 my income dropped with 20% but I also started to invest more aggressively and started to save more.

What changed in 2021

In 2021 I had about 23840, or about 1200 EUR less then 2020, or 5700 EUR less then 2019.

The biggest change however was the fact I started to invest large amounts of my savings in the stock market. This is very clear in my monthly portfolio updates. This grew my liquid portfolio from 45920 to 225000 EUR, of which about 40.000 EUR this year was pure compound interest.

The lower saving rates, compound interest of my portfolio and extra investments have as a result that the time before I reach Financial Freedom has dropped drastically to 11 years until I reach it.

As I said before this number is a moving number. It might still change by decisions I make in life or by a market crash for example. We did had the best year on the stock market since 2009. Some say the bull run has only just begun, others say we are in an everything bubble and a crash is just around the corner.

I personally think in 2022 we will see the stock market move even higher.

In total I am now 33% fire. As you can see both the amount I would need to reach Financial Freedom and the amount I have have grown closer to each other.

I would now only need 681144 EUR to be able to live from my savings.

How to deal with purchasing a house, children or unexpected global events

I can’t predict what life will bring. I feel I still have so many steps to take in life and having children for example could bring up my expenses considerably. In general I will always try to add something to my FIRE portfolio, but at the same time I will not let it stop me from living. I rather focus on increasing my income then on lowering my expenses at this point. In 2021 I set myself the goal that I wanted to have a saving rate of 56.35% or 3% more then 2020. In 2022 I plan to match the saving rate of 2021 to make sure I can live properly.

That’s it for 2021, I look forward to updating you all in 2022 how much my Roadtrip to Financial Independence has progressed.

Interested to follow my progress? Follow me and join me on my Roadtrip to Financial Independence!