2013 Annual Review

Looking back, 2013 was a very successful year financially. With headline figures of 39.5% net worth growth and a 69% savings rate, it has been my best year yet.

Asset performance:

My property investment continued to yield reliable high income, and the property value continued to appreciate. In 2013 (and going back long before) this continued to be my best performing asset.

My pension funds appreciated, with unit values increasing around 15% on top of continued monthly contributions. This benefited particularly from the exceptional UK and US stock market performance.

My investment portfolio grew materially with regular investments, but had mixed performance with developed equities outperforming emerging markets. Although many investments appreciated and paid regular high dividends, falling metals and some adverse fx movements saw the overall performance stay fairly flat.

Cash grew materially, both in dollar terms and as a proportion of total assets. This was a result of a high savings rate and a couple of big one offs.  I did manage to maintain a reasonable cash yield over 2%.

Performance against 2013 objectives:

1) Reduce cash balances towards my medium term target of 20% of total assets.
FAIL, although i did continue to build up my investment portfolio to a reasonable size and maintain a healthy cash yield. I really need to give some thought as to my target asset allocation, as the more this builds up, the greater the effort will be to re-balance.

2) Maintain investment discipline.
Overall, i am happy with my performance here. 2013 was by far my most active year in the markets and i have built a portfolio that largely meets my investment objectives. One blemish early on saw a loss realised on some more risky pref shares from chasing yield.

3) Achieve a high savings rate.
This was a major success, and achieved whilst not making a conscious effort to hold back on any particular expenses. I expect this to drop in 2014, but still stay well above my target floor of 50%.

4) Improve fitness.
This was broadly flat, with ups and downs during the year. My gym membership was renewed and I will re-focus for the new year.

5) Improve work/life balance.
2013 was a very tough year for work, and whilst this started quite badly, i felt it did improve towards the end of the year.  Realistically work will stay challenging going forward, but i feel i am doing a better job of making the most of time away from work.

Overall, i'm happy with what i achieved in 2013. That said, there are a number of things i'd like to work on in 2014 which i'll cover in a separate post.