This week: A potential future → UK growing? → Leaders move to fix energy crisis → Job cuts → Which ETF is best? → First rule of compounding.
THE BIGGEST LESSON:
This week I had a catch up with an old family friend in his early 60s who does a manual job, him and his wife had worked all their lives. During our conversation I had an insight into a potential reality for me and one he and many others have gone through.
He's now at the point where ideally he would retire. His back is just about hanging on, not enjoying getting up in the dark, going out in the rain all day.
But he has a problem, he can't retire just yet. He doesn't have the option available to him. So he's hanging on until he and his wife are 67 (3+ more years) before he can hang up his boots.
They own their house outright but throughout their lives, every time they've got a bit of money, they've spent it. Holidays, stuff for the house etc.
I have absolutely no problem with people doing that, in fact I encourage people to spend to enjoy their life, I just don't think you should spend everything and not invest also.
Because eventually, you end up in a position where you don't want to work, but you have no choice.
This is a reality for so many people across the country past and present. But it doesn't have to be for us.
We invest because we want freedom. And we put away the amount every month that would've been wasted spent on things we don't actually need. This is the life I'm trying to build, a life I enjoy today and am free tomorrow. I hope by following my journey you can build this life too.
WHAT YOU NEED TO KNOW:
UK set for more growth and inflation according to IMF
The IMF upgraded the UK growth forecast from 1% to 1.3%. Still off the GDP targets we aim for, but a positive move nonetheless. This upgrade has been put down to AI-related business investments and exports in software. The UK now ranks second fastest growing economy in the G7.
This coincides with inflation forecast staying high, and expected to average at about 3.3% this year. Meaning the Bank of England will continue to keep base rates high.
Leaders making moves to fix energy crisis
With the threat of El Nino, ongoing wars between Russia/Ukraine and the US with Iran, we're being lined up to expect an uncomfortable winter with high energy bills. So this week, both the UK and US leaders took different steps to help.
Donald Trump surprised everyone by striking a deal with Putin for 300,000 tons of diesel (enough for a days supply in the US) and Andy Burnham received backlash from his statement to use Google Maps to find the cheapest fuel source local to you.
Citizens across both nations had strong opinions on both strategies. I've got a feeling this will be an ongoing problem for the leaders to try and solve as it gets colder over the next few months.
Job cuts left, right and centre.
AI has now been talked about as a potential threat to all human jobs as we know them. But is it now being used as an excuse by unproductive businesses?
Last week, in one day, we saw 3 companies announce they're cutting jobs. What struck me is it was 3 completely different companies, across 3 different industries with 3 different reasons why.
- HSBC blamed AI and are cutting UK wealth unit.
- Royal Mail blamed demand and cutting Head Office.
- Porsche blamed low sales and cutting R&D department.
Job security feels low across the board. Which increases the importance of an Emergency Fund to protect us should the worst happen.
SOMETHING YOU CAN COPY:
A question I get often in the replies and DMs is regarding what fund to invest into as a new investor. I'm vocal about my favourites (and the funds I am personally invested in). So this week I did an X post to compare both VALL and VWRP. Here it is for you to read and make your own decision:
QUOTE OF NOTE:
THE TAKEAWAY:
Life can come at you fast. We don't invest because we love investing (although some do). We do it to give ourselves optionality. Not necessarily for today, but for our future selves.
Take some time today to picture yourself in your 50s and 60s. Do you want to have to work to survive until you get a state pension (if we even get one), or do you want to have options to do exactly what you want?
I know what I want. Everything I do today is focused on giving my future self options, without sacrificing the things I enjoy in life today.
