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Portfolio Update – March 2019 – Invest your pay raise

Good day, saver. We have now surpassed March in what is my first year of utilising the strength of the All Seasons Portfolio. One whole quarter is behind me, and still feeling strong. Besides an update on my portfolio, I’ll discuss what you should do when you get a salary increase or a bonus from work, if you are looking to increase your investing. More to come further down.

Still quite sun burnt while writing this post. I was in Nice and southern France over the weekend in the end of March, and my Scandinavian pale skin didn’t cope with the Mediterranean sun. Naturally, I forgot to put on sun screen, because “hey, it’s only March – how bad can it be?” A lot apparently. Well, now back from 20 degrees to the usual -2 and snow (somewhat fed up with winter by now).

Invest your pay raise

Anyway, the month of March has also been sunny for my portfolio. I have managed to put in more than the planned monthly amount of €300, thanks to a pay raise from work, which had retroactive effect from the start of the year. This is a great contribution towards creating sustainable wealth, by investing salary increases and ‘unexpected’ income such as bonuses.

Let’s say you are struggling to find enough margin in your daily life to invest a good amount each month and at the same time make ends meet. This is not a too uncommon feeling. Anyway, you would have a certain salary and certain spending level each month (hopefully not more than you income though). You are used to a standard of living and feel like you cannot find anything non-essential that you can cut back on to invest that money instead. 

Then, you get a pay raise. For many, the salary is adjusted upwards once a year. What would you do with this extra monthly income? Many would at the same adjust the spending level with the corresponding amount to the new income level, but think again. You have obviously proven to yourself that you have been able to live on less than your new income level for a long time, before you got the raise, so do yourself a great favor. Invest whole (or part of) the difference between your old and new salary levels and add the proceeds to your portfolio. Your monthly expenses and living standards won’t decrease, so it won’t feel like you are sacrificing anything, while you build your wealth. And keep doing so every year, and you will see that your saving ratio grows in great leaps, getting you on your way towards financial freedom. Sounds like a win-win-win?

Monthly update for March

So with my yearly bonus, together with plowing down some of my previous savings, I have been able to add €1,200 into my investment account. I deem myself lucky and humbled to have this possibility this year, and know that I won’t have the same amount to invest each month. Really stretching myself thin though otherwise not buying myself any material gifts or spending frenzies this time. This year, my portfolio is my priority.

Since last month, my portfolio has consisted of only Long-Term Government Bonds and Corporate Bonds. Not se well-diversified, so this month, I really put my act together and have spread my capital across the below pie chart to start diversifying from gray and yellow.


This month, I have used my available money to fill up on the left side of the graph above, namely stocks, gold and commodities (market in bold in the table further below). This gives me this current allocation:

Asset Category Last month This month
Vanguard EUR Corporate Bond UCITS ETF Corporate Bonds 364.31 € 368.86 €
iShares J.P. Morgan EM Local Govt Bond UCITS ETF USD (Dist) (EUR) Govt Bond Long 365.85 € 365.99 €
iShares $ Treasury Bond 7-10yr UCITS ETF USD (Dist) (EUR) Govt Bond Long 337.50 € 351.15 €
Invesco Bloomberg Commodity UCITS ETF (EUR) Commodities       –   € 341.20 €
Xtrackers Physical Gold ETC Gold       –   € 425.05 €
SPDR® MSCI USA Small Cap Value Weighted UCITS ETF USD Acc Equity       –   € 448.14 €

(You will find more details of the above mentioned ETF’s and ISIN numbers on the ETF Portfolio Suggestions page)

This gives me a portfolio worth a total of € 2,300. The splits are still slightly off from the aimed allocation, but we’re getting there. I also received the first dividend from my Emerging Markets Government Bonds, of a whooping € 0.35. That’s just the start of it I suppose, and adding that back into the portfolio for compound interest. 

For you who prefer more visual presentation, here is the graph of the portfolio development. Noticing a slight increase in the value for my Long-Term Government Bonds as well, they have been performing well the last month on the exchange. 


My plan going forward, will be to keep adding on what I am yet lacking in my portfolio, that is to say TIPS and Intermediate-Term Government Bonds. The next step after that will be to add on where needed to get the percentages right – I am still a bit off (except for my Long-Term Government Bonds, which currently are dead on). 

Until you reach more significant amount, the portfolio will in reality not be perfect in the percentage splits between assets. So you will just have to fill up where it is missing to slowly but surely work towards that 45% bonds, 30% equity, 7,5% gold and 7,5% commodities split.

Thanks for reading. All comments are highly welcomed. Have a good beginning of the Q2 2019, and let’s catch up in about a month!

Want to find inspiration for your All Seasons Portfolio? Head over to the ETF Portfolio Suggestions page to find suggested ETF’s to begin with.

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