The Point

All this hard work, the saving, the extra money on the side, why do we do it?

The answer seems pretty obvious, but I though it might help me to write it down, quantify it a little so I can see how we progress.

I see it as three phases: Stability, Lifestyle and Sufficiency.  The goal is to progress though these.  They can be measured by four variables:

A is total net earned income, from our jobs.
B is investment income and interest.  This will include pensions when they eventually become payable.
C is additional income.  Surveys, online income, the other bits we blog about here.
D is spending.  That's our bills, mortgage, groceries, holidays, going out, hobbies, everything.


Phase 1: Stability

You are in the stability phase if your total income exceeds your total expenditure, but your expenditure is less than you would like it to be.

A + B +C > D

Here, you're making a gain every month, putting money into savings.  You'd like to live in a bigger house, go on more holidays, eat out more often, but you moderate these things to stay in surplus.

As Mr Micawber said "Annual income twenty pounds, annual expenditure nineteen [pounds] nineteen [shillings] and six [pence], result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."

Keep working hard, earning more money, keep an eye on your budget.  The bigger you make that surplus every month, the faster you can make B grow, to help you move on to phase 2.

Phase 2: Lifestyle

Ok, you've worked hard, earned the promotions and pay rises; you've saved hard and got some nice investment income trickling through.  Your surplus is getting bigger.  Maybe it's time to live a little.  So now you can start to increase D.  You get the things you've been denying yourself, move to the dream house, have the nice holidays.  You squeeze the surplus, but make sure you're in surplus.  Once you're spending everything you want to spend, but still running a surplus, you've achieved phase 2.

It's difficult to know when to make the transition from stability to lifestyle.  The longer you wait in phase 1, the easier the transition will be and the easier it'll be to get to phase 3, but you still want to enjoy life while you're still young enough.  In practice, a gradual ramp up of the spending to keep the surplus as high as possible is probably a good plan.

Phase 3: Sufficiency

The ultimate goal, where you're spending what you want and you have enough investment income to cover it.  Now you can stop working.  You don't need that money any more.

B > D

This isn't easy to achieve and most people never get there.  It'll help when the pensions kick in and bills tend to drop off later in life.  

Maybe if we work really hard, we can get here before we're old.  Retire early and enjoy life.  It's a bold ambition and it certainly won't be easy, but it's good to have something to aim for.  

We're going to aim high and if we fall short, all the hard work will make sure that we land in a good place.

July 2015

£340.86 in July, bringing the total to £424.13, 21% of our target done after just two months.

Still got a big chunk pending on Clixsense and also a fair amount on Prolific Academic, so August will be off to a good start.

This month's favourite site is Prolific Academic.  It's a fairly new survey site used by universities to gather information for their research.  Their pre-screening is excellent, so you never get screened out half way through, pay is good and fast and there's plenty of work available.  The £50 below is just what I've banked this month.  I've got another £11 pending and I only started on 3 July!  Emma hasn't cashed out yet, but she's sitting on another £40, having started a week after me.

If you're only going to sign up to one survey site, make it Prolific Academic.

Here's this month's breakdown:

Source	July	Total	Guide	Sign up
Clixsense	£65.58	£87.17	Clixsense Guide	Clixsense*
Prolific Academic	£51.44	£51.44	Prolific Guide	ProlifcAdademic*
Quidco	£43.20	£43.20	Quidco Guide	Quidco*
MySurvey	£30.00	£45.00	MS Guide	MySurvey
Global Test Market	£35.00	£35.00	GTM Guide	GlobalTestMarket*
WorkShopPlay	£25.00	£25.00	WSP Guide	WorkShopPlay
Pru Health	£22.50	£22.50	n/a	n/a
Halifax	£5.00	£20.72	Halifax Guide	Halifax
Valued Opinions	£0.00	£20.00	V O Guide	ValuedOpinions
MyView	£20.00	£20.00	MyView Guide	n/a
Shop & Scan	£20.00	£20.00	S&S Guide	n/a
Selling stuff	£12.00	£12.00	n/a	n/a
Else	£0.00	£10.00	n/a	n/a
Top Cashback	£5.64	£5.64	TopCashback Guide	TopCashback*
The Viewers	£5.50	£5.50	Viewers Guide	TheViewers
Qmee	£0.00	£0.96	Qmee Guide	Qmee*
Total	£340.86	£424.13

*If you sign up using this link, we will receive a bonus, but it won't cost you anything.

Pru Health is a nice little bonus.  Emma gets private medical cover through work and they pay her cash once a quarter for not smoking.  As someone who has never smoked, that's a really easy thing to achieve.

Selling Stuff  Sold an old desk and chair on Facebook.  Now the room that was an office contains a beer fridge and a comfy chair.  Perfect place to sit and blog.

Shop & Scan seemed like a bit of a faff at first, scanning all our shopping before we can put in in cupboards, but I've been pleasantly surprised how fast the money is building up.