Rich, stuck and bored

Needless to say that 2020 is an interesting year. It’s the first year we are rich, stuck and bored all at the same time. Let me elaborate.

Rich

Albeit we are not FIRE (close though), and we are not millionaires (yet), we do consider ourselves rich in multiple ways. We are in fact “rich” when looking at the graphs and distributions in the following CBS post (in Dutch). I’ve lifted out the wealth distribution for those non-Dutch to make our point (yes, it’s 2017 data, but it has not changed that much).

Rich, Stuck and Bored: Being Rich
Source: https://longreads.cbs.nl/welvaartinnederland-2019/vermogen-van-huishoudens/

We currently happily sit within the €500.000-€1.000.000 wealth category. Looking at how small that sliver is within the total wealth distribution, I think it’s safe to say that we are likely “rich”.

In absolute terms, we sit in the second highest cohort which accounts for about ~4.8% of the households in the nation. There is only one cohort above this (the real millionaires), which accounts for ~2.3% of the households in the nation. In short, financially, we are part of the upper ~7% of the Dutch households. So yeah, pretty sure we can call ourselves “rich”. Not that is feels that way, but what the heck!

But besides the financial side. We are also rich in having a great life. We are happy and healthy, two things that are not to be taken lightly (or for granted). That being said, we could be happier. Let me further elaborate.

Stuck

Like most of you we have been stuck in our home for most of 2020 (bloody virus thingy…). Initially it was due to the lockdown, but lately it’s also because of money. I should actually say income. We are both (still) unemployed. Mrs CF because she is studying, me because I cannot work internationally due to all kinds of Covid-19 related issues (many projects are on hold). It looks like this situation could continue for a couple more months (hopefully not years!) before work may resume. In short, no work, no income, no mortgage.

Rich, stuck and boring: Very stuck
Rich, stuck and bored: Very stuck!

This is problem for us as we are looking forward to move. Not sure where to, or when, but the house we currently use is being transformed into two rental units. We will likely rent one out and use the other for ourselves temporarily. But ultimately we want to move to greener pastures, sort of. However, we cannot until one (or both) of use get some (temporary) income. We have cash, but not nearly enough to afford a home we would like in this HCOL (high cost of living) part of the Netherlands.

Obviously we can downsize our wish-list, but we are spoiled at this stage and are not (yet) ready to do this. Plus, we are not willing to pay insane amounts of money (read €3.500-5.000/m2 or $375-525/sqft!!) for place that still needs renovations and is situated on a plot the size of a postage stamp. The housing market is ridiculous at the moment. It’s plain stupid actually. Anyhow, did I mention we are spoiled?

Boring

Now, the above leads us to being bored. Somewhat anyways. We are currently heavily into the renovations to make our house into two units. We upgraded and split the heating system, plumbing, electrical wiring and placed two kitchens. However, we still need to finish these kitchens (one is missing a countertop for example – still to be ordered).

Other outstanding works include new ceilings, partition wall, two new doors, door removal and replacement with a window and installing/finishing a new heating unit. In short, and with no rush behind the deadline, we are likely still going until October or November before we are completely done.

Rich, stuck and boring: bored....
Rich, stuck and bored: very bored….

After this, we will be really bored (again)! Well, perhaps not Mrs CF, who will be studying, but me for sure. This is especially the case if that bloody virus continues to circle around (which it likely will). Without the ability to work, move, renovate and socialize the way we used to. Life can become quite boring (as you might have noticed earlier this year, I sure did!).

Considering I tried the entrepreneurial route, which was not a success, I’m not going to do that again. I’m also not a fan of side-hustling. Never found a topic that got me all excited and made me turn that excitement into money. I might focus again on working out some more. Perhaps I’ll hire myself out as a contractor! But I’m afraid that the future might be more boring than I would like it to be. I’m craving excitement here. I look forward to travel and see the world.

Castle?

There might be one exception to being bored: Castle of FIRE! Yes, it’s still supposed to go ahead, we still have some spots as people had to cancel due to moving it to October 16-23, 2020. Let me know if you are interested! Really hope a second wave of the Covid-19 virus will not kill this event too….

Are you bored too? Still have a job?

8 Comments

  1. Just wait for the next few years to come. Prices of properties will drop that it will be in an affordable range again (ofc just for a few years because the market will recover and it’s just an “over-reaction” to the economic damage what will we done (companies go bankrupt, people lose their jobs, uncertainty, etc).

    Every time has its opportunity and its for you to see that an to use that. Get out of the comfort zone and try to develop yourself. Then you don’t have time to get bored is my experience. The last crises (the financial one) I used to to that myself (again), and shifted to a broader property market (Germany). I’m very happy I did, because from what I have experienced now I see that it was spot on. We have had a “perfect storm”, prices are relatively low, rents are stable and rising, banks borrow you (almost) as much as you like and therefore you can grow really fast! I’m looking back to that time now and see what it has brought and I am very happy with it (for example I pay back the loans with 4% p.a.!). So my advice in this time is really to challenge yourself and go the extra step to get to your goal. You’ll have plenty of time for that now so just go for it! (I still do, and I don’t have a day I’m bored, everyday is exciting and has it’s challenges! And because you don’t have to do things you can also enjoy and relax when you wish 😉

    1. Sure hope to see a price drop and complete the portfolio we need to FIRE!
      My problem is that once I’ve figured out something for 80%, I lose focus and determination and start looking for another challenge. I suck at seeing things through to the end. Still hoping to have an international job for a couple more years building fun stuff before I pull the plug completely and enjoy working out, and all the other fun stuff life has to offer. I don’t need to always be a goalgetter and push myself 😉

  2. Almost 60% of all private wealth in the Netherlands is the value of your primary residence. That means that you can actually be a millionaire but not able to get a revenue out of that, except if you sell or rent out your home.
    The statistics are a bit misleading for the non-NL readers, because it does NOT count any pensions you have built up, which can be worth many hundres of thousands of euros. The Netherlands is more egalitarian in wealth than these simple statistics show.
    OT I do recognize the bored part, but I’ve always been bored easily. I can’t do the same thing for more than 2 years.

    1. Thanks Uitlokken, this answers a question and hunch I had. A lot of DB pensions in NL too, which can’t be counted as raw wealth either, like a DC pension could. But if you calculated them according to the “waardeoverdracht” then indeed for many folk they’d be worth hundreds of thousands of euros.

      What also stands out to me on the distribution chart is the impact of weak housing market. The number of people in “negatief vormogen” is still very high relative to pre-2009. Seems to imply that the consequences of that era still haven’t been offset yet, even though house prices have been rising since 2013.

      Who would have thought 100% interest-only mortgages and >100% LVRs could have such a broad and long lasting impact??

      1. It is in chart above though, right? From the link: “De eigen woning vormde met 58 procent van de bezittingen het grootste vermogensbestanddeel.”

        I think you’re right about the CBS definition of “millionaire”. I recall reading somewhere in the stats about “millionaires” in the Netherlands and that their definition is capital not including equity in the primary place of residence.

  3. I’m happy to read that there are more people who are on their move towards FIRE and are at the same time facing a major decline in their income. But I still have my job. There are more parallels in our stories: we are also renovating. Because we also want to trade the big city for lots of nature. However, our house will be up for sale in a couple of weeks.

    ps: I love to read books or dream away when I bored.

    1. We love nature too, best of luck with the renovations (and sale). Seems like a smart move!!
      P.s. I’m really good at doing nothing. Can keep that up surprisingly long 😉

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