categoryCryptocurrency

February 2021 Review

Hello!

I just knew February was going to go by very fast. 🙂

Seriously, between finalizing my old job’s last few files, starting my new position and writing my withdrawal strategy article, time just flew by! It’s quite a good thing for someone who doesn’t like winter too much. During a lockdown, on top of it! I’m also quite glad to see that we’re gaining a few more minutes of daylight every week. That’s a very positive thing in my book. 🙂

I’m also happy to report that things are going really well in my new role. I have a lot to learn, since I’m far from my usual field of expertise. So that usually means my brain is mush at the end of the day, but I’m confident I’ll handle the work fairly quickly.

Now let’s get down to business.

Net Worth as of February 28, 2021

Assets
Checking Accounts:
Questrade TFSA:
Questrade LIRA:
Questrade RRSP:
FTQ RRSP:
Fondaction RRSP:
Non-registered:
$1,228
$34,983
$44,969
$35,135
$5,752
$13,427
$976
Total assets:$136,470
Liabilities
Car Loan:
Line of Credit:
Tangerine Master Card:
Amex Air Miles:
BMO Air Miles:
Amex Aeroplan:
$7,384
$3,000
$0
$0
$0
$0
Total liabilities:$10,384
Net Worth$126,086
Difference+$4,968

What a weird month in the markets! Seriously, how many days in a row were the markets green at the beginning of February? It was not rare to see clickbait articles predicting an imminent crash almost every day. Reaching all-time highs every day, week (and even month) was obviously cause for concern. So it wasn’t too surprising to see the second half of the month rebalancing things.

However, I would like to emphasize that the recent decline has not completely erased the bullish rise that preceded it. In fact, both the S&P 500 and the S&P/TSX show an overall increase in February. 🙂

Personally, I try to remove all emotion from my transactions. Mr. Spock would be proud of me. 🖖

My plan is to save as much as I can on every paycheck I get. I invest on every second Thursday, whether it’s green or red. It doesn’t matter. I invest, no matter what happens in the short term. Anyway, what matters is long-term.

Bonus

Good news! My employer confirmed our annual bonus. It will be paid out on March 25th. Knowing the amount in advance ($6,000 gross), I have decided to take the net amount ($3,000) out of my personal LOC and invest it right away while the markets were down.

I was already planning to save and invest my entire bonus anyway. So I just got ahead of the curve.

Once I receive my bonus on March 25, I will simply pay off my LOC. For your information, it’s a personal LOC offered by Tangerine with a 5.45% interest rate.

Cryptocurrency

Contrary to my very boring index investments in the stock markets, I allow myself to speculate a bit more with crypto. Actually, I only allocate a small portion (1%) of my portfolio that I intend to hold for the long term. I am looking into the mechanics of cryptocurrency and the blockchain, and I place my pawns as I go along. It is a very wild ride. Faint of hearts beware. 😉

I also got three $30 bonuses on Shakepay this month. Thanks to the readers of this blog who used my reference code. 🙂

Also, thanks to Shakepay’s feature that allows me to stack Satoshis (a subunit of Bitcoin) every day by shaking my phone, I have now accumulated 0.0004352 BTC for a series of 47 consecutive days. At the price of the BTC as it is now, it means about $26 only for shaking my phone. I have also deposited all my BTC in BlockFI which allows me to earn 6% interest on it.

Savings

Here are the details of my February savings:

  • February 11: $700 out of $1,710.66 (41% savings)
  • February 25: $840 out of $2,017.17 net (42% savings)
  • Total savings: $1,540 in February or 41% savings

Of the $1,540 I saved, I contributed $1,050 to my TFSA and purchased $490 worth of cryptography outside a registered account.

It could definitely be better on the savings rate front, but I had some spending to do to unlock my credit card bonuses. I’ve made some expenses ahead of time by buying Spotify, Netflix and SAQ gift cards. I also made my annual donation all at once, rather than spreading it out on a monthly basis. Since these are already paid for, I should be able to save a little more in the next following weeks and months.

These expenses have allowed me to get my bonuses of 3,950 Air Miles and 10,000 Aeroplan points (as well as the Buddy Pass). Now, I just have to wait to actually travel. 😉

With my promotion, my March bonus and my yearly raise in April (3.5%), I expect a slight increase in my average savings rate. I should be on track to reach my savings goal!

Expense Report

DateAmountDescription
2021-02-01$497.50Rent
2021-02-01$89.15Groceries
2021-02-01$25.00SAQ
2021-02-02$7.15Spotify
2021-02-02$10.00Donation
2021-02-03$160.00Passport
2021-02-04$62.38Mondou
2021-02-04$29.50Hydro-Québec
2021-02-04$13.33Pharmacy
2021-02-04$100.00Donation
2021-02-04$25.00Netflix
2021-02-04$30.00Spotify
2021-02-05$48.04Car Insurance
2021-02-06$3.40Starbucks
2021-02-11$168.94Amazon
2021-02-12$403.85Car Payment
2021-02-14$3.40Starbucks
2021-02-14$8.04Groceries
2021-02-18$102.93Groceries
2021-02-20$20.83Gas
2021-02-20$3.40Starbucks
2021-02-23$6.14Subway
2021-02-26$403.85Car Payment
2021-02-27$3,86Starbucks
2021-02-28$27.02Home Internet
Total:$2,315,94

In February, I spent $2,315,94, which means $27,791,22 annualized. Excluding my car loan payments, it comes down to $1,508.24 or $18,098,82 annualized.

In addition to my travel hacking expenses, I had to renew my passport and I bought a Valentine’s Day gift for my mother and my grandmother.

I also had a somewhat big expense on Amazon for a treadmill that I had been looking to buy for a while. Luckily, my employer reimburses a fair amount for sports activities. That means I only had to pay $168 out of my own pocket. Considering that the treadmill should be good for a couple of years, that’s much cheaper than a gym membership. 😉

Finally, I still don’t have a mobile phone bill to pay this month. Thanks to everyone who used my Fizz promo code (N5MMB)! As things are right now, I won’t have to pay anything until June. That’s very much appreciated!

Reading List

February was another great month to read. I’m not at all a winter sports fan, so I’ll be found more often cuddled in a blanket with a book, rather than out playing in the snow.

At the same time, although I’m outside much more often in the summer, you’d probably still find me with a book in my hands. Once a nerd, always a nerd.

You can see that it would be totally unprofitable for me to buy every book I read! There’s a reason why I love the public library so much. 🙂

So, my reading list for February looked like this:

From this list, I highly recommend the book on Elon Musk. Whether you like him or not, he is undeniably a genius and human beings will benefit from his long-term vision.

I also liked Courage, Vision, Passion after I stole this reading idea from L’investisseur caféiné. I don’t necessarily plan to invest in real estate, but it was still a fascinating read. The focus on the millionaire mindset, the importance of thinking big and controlling our fears were the highlights for me. That goes to show that a success starts in the mind!

My Favourite Season

Of course, with March comes tax season. 😉

Seriously, I can’t wait to get started. I already have my T4 and Relevé 1 in hand, but I won’t have the form for remote work (detailed method) until mid-March. Only then I’ll be able to do my tax return, plus my sister’s and my brother’s. At the very least, I want to send my sister’s tax return as early as possible. She boosted her RRSP and she’d like to avoid paying interest on her loan for too long. 🙂

For my part, despite the fact that I filled out the T1213 form for my employer to withhold less tax in 2020, I still expect a tax refund of about $1,500. Guess what I’m going to do with it?

For future articles on this blog, I’m thinking of writing an article on my worst financial mistake (I’ll let you guess which) and the associated opportunity cost. I’m also planning an article on the emergency fund, or my lack thereof. If you have any specific topics to suggest for a future article, please feel free to let me know in the comments section.

I look forward to hearing from you!

January 2021 Review

Hello!

Already one month behind us! Even though it’s a rather boring time of the year, even without a pandemic, I feel like time went by pretty fast. My blog and Facebook page keep me pretty busy, on top of the overtime I did at work and the time I’ve spent preparing for a job interview!

It just goes to show that the best way to survive this never-ending pandemic is to stay busy. 🙂

So here we are, already starting a new month. Let’s see how my net worth has grown in this past month!

Net Worth as of January 31, 2021

Assets
Checking Accounts:
Questrade TFSA:
Questrade LIRA:
Questrade RRSP:
FTQ RRSP:
Fondaction RRSP:
Non-registered:
$1,369
$32,176
$43,405
$33,916
$5,752
$13,427
$307
Total assets:$130,352
Liabilities
Car Loan:
Line of Credit:
Tangerine Master Card:
Amex Air Miles:
BMO Air Miles:
Amex Aeroplan:
$8,192
$1,000
$0
$0
$31
$11
Total liabilities:$9,234
Net Worth$121,118
Difference+$3,313

My net worth is now $121,118! That’s a $3,313 increase since December 31, 2020. It had been a good month for the stock market, right up until last week, when everything went haywire. It doesn’t matter much, since I continue following my savings and investment plan and as a result, my investments slowly but surely keep going up. 🙂

As a matter of fact, a reader wrote to me recently and wondered if the monthly portfolio value was the best way to track one’s net worth. She thought that it fluctuates excessively from one month to another, and it could be discouraging during periods of decline.

I have to agree that tracking my net worth so closely involves a lot of fluctuations. However, I am aware that this is part of the game and I have an excellent risk tolerance. Since I already track my net worth in my spreadsheets on a monthly basis, I decided to include it on my blog on the same basis, along with my expense reports.

However, I realize that I will eventually have to compress the data on the graph (due to lack of space) on my net worth page, possibly to three-month intervals. This should smoothen the curve a bit. 😉

Portfolio Changes

I decided to start the year with a few small changes to my portfolio. As I mentioned in previous articles, my main investments are with Questrade, split between a LIRA, an RRSP and a TFSA. In all three accounts, I held only XEQT, an all-in-one ETF by iShares made up of 100% equities, 22% of which are Canadian.

Reducing Home Country Bias

After doing some reading, notably Ed Rempel‘s blog, I decided to reevaluate my home country bias, i.e. being too widely exposed to one’s own country’s stocks. Indeed, Canada represents about 3% of the world economy and is primarily based on resources and banks. Knowing this, how is it good diversification to hold 22% of my portfolio in Canadian stocks?

Especially since I have (unfortunately) about 15% of my portfolio in labour-sponsored funds that invest only in local companies. That means my home country bias is actually quite high. It actually amounts to about 33% of my total portfolio in Canadian equities.

After some thought, I chose ZGQ (graciously brought to my attention by one of this blog’s reader) to reduce my home country bias a bit, in addition to getting a bit more exposure to emerging countries. This ETF actually seeks to replicate the performance of the MSCI All Country World High Quality.

However, I only made the change in my TFSA, where I want to get the maximum return. I still hold XEQT in my LIRA and RRSP. This will gradually reduce my portfolio’s total exposure to Canadian stocks as I continue contributing to my TFSA.

A Healthy Dose of FOMO

Yes, I joined the Bitcoin train (or rocket?). It finally went down after its all-time high in early January. So I took the opportunity to learn a bit more about Bitcoin, then invested a small amount of money. Initially, I decided to do this by buying a few units of the new Bitcoin ETF QBTC. This way, I can take advantage of the possible gains of Bitcoin in my TFSA, which cannot be done by the traditional method.

Afterwards, I continued to read up on Bitcoin and learned about the Montreal application called Shakepay and decided to actually buy Bitcoin this way. In fact, by using a referral link, I was getting $30 by buying $100 worth of cryptography. So why not? An instant return of 30%. 😉

More seriously, I prefer to set myself a limit of 1% of my portfolio with regard to cryptocurrency. I think setting a limit will prevent me from going overboard on this. What’s more, it’s an amount I’m willing to lose. And if I ever make a  sizeable profit, even better! I just don’t intend to speculate, but to buy and hold it like with my other holdings.

Savings

Here are the details of my January savings:

  • January 14: $750 out of $1,710.67 (44% savings)
  • January 28: $1,035 out of $2,005.17 net (52% savings)
  • Total savings: $1,785 in January or 48% savings

Of the $1,785 I saved, I contributed $1,550 to my TFSA and added $235 to Shakepay.

The higher pay is justified by a few extra overtime hours in January.

Also, starting at the end of February, I’ll start getting bigger pays because I got a promotion! Before the holidays, I had applied to a higher-level position within another team. I didn’t necessarily have a lot of hope to get a call, as I didn’t know anyone on that team. You know it: it’s better to know someone than to know something. Luckily, I got the call and a few days after the interview, I was offered the job. 🙂

So, I will go from a base annual salary of $71,180 to $76,600, which is a 7.6% increase. There will also be a yearly increase in April, which should be around 3%, which would bring my salary to $78,898.

I’m not just talking about increasing income. Trying to walk the talk!

Finally, my $25,000 savings goal for 2021 will be slightly easier to achieve than I thought. You know me well enough to know I plan to save 100% of my raise. 🙂

Expense Report

DateAmountDescription
2021-01-01$120.00American Express Annual Fees
2021-01-01$6.79Starbucks
2021-01-02$7.15Spotify
2021-01-02$10.00Donation
2021-01-02$18.39Mondou
2021-01-02$13.41Gas
2021-01-03$96.42Groceries
2021-01-04$497.50Rent
2021-01-04$403.85Car Payment
2021-01-05$14.39Home Insurance
2021-01-05$48.04Car Insurance
2021-01-07$14.23Subway
2021-01-07$12.50SAQ
2021-01-09$7.70Netflix
2021-01-09$3.40Starbucks
2021-01-13$29.50Hydro-Québec
2021-01-13$71.95Home Insurance
2021-01-15$403.85Car Payment
2021-01-17$3.40Starbucks
2021-01-17$101.00Groceries
2021-01-21$25.21Pharmacy
2021-01-23$3.40Starbucks
2021-01-25$11.09Pharmacy
2021-01-28$20.82Gas
2021-01-28$15.29Groceries
2021-01-28$2.70Starbucks
2021-01-29$403.85Car Payment
2021-01-30$27.60Home Internet
2021-01-31$3.40Starbucks
Total:$2,396.83

In January, I had $2,396.83 in total expenses, or $28,761.96 annualized. Excluding my car loan payments, it comes down to $1,185.28 or $14,223.36 annualized. The big difference between the two is explained by three car payments I had this month, instead of the usual two.

Otherwise, one month look like the next! I should be ashamed: $23.09 in Starbucks coffee. Just think about it! That’s $277.08 a year! It would take $6,927 invested to generate enough passive income to pay for this bad habit! I just can’t wait to do anything other than car rides. 😉

Also, there are some transactions related to travel hacking, such as the $120 annual fee on my Prestige Aeroplan American Express. I also paid my home insurance policy balance in full to help me reach the required spending on my BMO AIR MILES Mastercard to unlock the 850 bonus miles. Once again, I didn’t spend more to earn points, I spent money I was going to spend in the future. 🙂

It’s ironic, really. My biggest challenge with Travel Hacking right now is to find a way to reach the spending thresholds necessary to unlock my bonuses. Luckily, Milesopedia gives good tips on how to do this.

Reading List

My Facebook page followers may have noticed: I am an avid reader. I often read several books in parallel, in addition to the occasional audiobook. Who knows, maybe one day I’ll reach Warren Buffett’s level:

Read 500 pages like this every day. That’s how knowledge works. It builds up, like compound interest. All of you can do it, but I guarantee not many of you will do it.

In addition to reading, I also like to share about the latest books I’ve read and know what others are reading. In that vein, I thought adding this section to my monthly reviews could be interesting to my readers. 🙂

So, my January reading list looked like this:

I have to admit it: I’m a Self-Help junkie. I still try to balance a bit between fiction and non-fiction. By the way, don’t be surprised to see a Star Trek novel in it from time to time.

Of this list, the one I recommend the most is definitely The Psychology of Money. For me, it was a perfect mix of two subjects I love.  Also, anyone who is struggling to make lasting changes in their lives would also benefit from reading The Power of Discipline.

February Is Going to Fly By!

February only has 28 days, after all.

Next Monday’s article will focus on job interviews and how to prepare for it, especially when you’re an introvert like me. The following week, I’m going to take a little break. I’ll start working on my new position then, and I want to be able to focus mostly on that. 🙂

So I’ll still have two weeks to put together an article on my withdrawal strategy once I’ve reached FIRE. Many of you are asking me to do an article on this, so I’ll try not to disappoint.

I will also have access to my T4 & RL-1 on February 16. This nerd will be very happy to get started on doing tax returns ! In addition to mine, I always do my sister’s and brother’s tax returns. 🙂

I’m especially looking forward to doing my sister’s tax return to apply the method to boost her RRSP contributions as perfectly as possible before March 1st.

As a matter of fact, do you have any suggestions for a good software to do multiple tax returns? I’ve been using UFile since 2014 without looking too closely at what others offer. I’m open to suggestions!

See you next time!