the richest man in atherstone

Regular readers will have noticed that this website has been somewhat quiet of late. There are two reasons for this lull.

Firstly, we've sold our house (Hooray!) and are rushing around arranging conveyancing, mortgages, life insurance and, of course, looking for somewhere to move to.

Secondly, I've been working with other doublers to create a forum where people following Stuart Goldsmith's Double Your Way to a Million wealth-building strategy can get together to discuss and debate money-making ideas, share doubling experiences and offer moral support to one another.

It's called THE DOUBLER'S DEN.

It is now officially open to all Doublers, so JOIN NOW. If you don't know what a Doubler is, be sure to sign up for your FREE DOUBLING REPORT.

To celebrate the launch of The Doubler's Den, we're running a competition to win over a month's free advertising on our website. Click here for full details.

Special thanks go out to the following Doublers for helping to make the Doubler's Den possible:

Xinfinitum
Edo
Flip
Maria
Team 28

This series of articles was inspired by a wealth-building strategy created by Stuart Goldsmith. It is called 'Double Your way to a Million' and you can sign up for your free copy on this webpage.

I visited my mum and found she'd gone through all the clutter in my old bedroom and had thrown it out with the rubbish. I had a look through the pile and found loads of old stuff that still had value, so I pleaded with my mum to hang on to it for a bit longer and I'd get it shifted. Eventually, she agreed to keep it until the end of the month.

I decided that the best way to do this would be through eBay. Now, I'm an eBay virgin so I had to get my wonderful wife to help me set up my first item to sell (a PlayStation game). I work in IT and I found the whole thing quite complicated so I'm not sure how the average Jo/Joe does it (or perhaps I'm just dumb!) but I finally got it listed and waited for the bids to roll in.

Well, I didn't get any bids until the last half hour but when the time was up I found I'd sold the game for £10.01. After postage and packing costs (£2.50), the eBay listing fee (£0.20) and Paypal fees* (an extortionate £0.54) I've made a profit of £6.77 which takes my doubling kitty way above the £2.56 requirement for step 9.

As the rules state, I must spend anything extra on myself so that's exactly what I'll be doing. Maybe a McDonald's tomorrow...

Step 9 Complete
Cumulative Cash: £2.56

* The reason for the high PayPal cost is because I have a Premier PayPal account. I had to upgrade a few years ago when I was making a fair bit of extra money moonlighting.

This series of articles was inspired by a wealth-building strategy created by Stuart Goldsmith. It is called 'Double Your way to a Million' and you can sign up for your free copy on this webpage.

I've been struggling on step 9 for a while now but a new career path has emerged. I am now a loan shark. I am charging exorbitant interests rates to the needy.

I fell into this role entirely by accident.

We have a vending machine at work that dispenses cans of Coke. Yesterday, one of my colleagues came to my desk and asked if he could borrow 40p for the Coke machine from the pile of coins in my drawer (my doubling stash goes everywhere with me). I said okay and jokingly added that I expected 50p back.

Anyhow, word must have gotten around because this morning another colleague wanted to borrow some coins for a can of pop. Again I agreed and tagged 'my little joke' onto the end. He needed just 10p and I said I wanted 15p back.

This afternoon, I came back from lunch to discover the first colleague had 50p for me. Soon after that, the second colleague came back with my 10p plus an additional 7p. I informed both that I was only kidding but they insisted I keep the few pence extra they'd given me.

So, 17p profit from today's misadventures. Maybe I should set up a little store by the can machine and provide a service to the thirsty without coinage

Step 9 in progress.
Cumulative Cash: £1.73

Click here to read my story of the week IceSave went bust.

7th October 2008
Lots of people are finding this page due to Iceland nationalising Lansbanki, the parent company of IceSave. This is my honest take on the situation:

I am anxious and feel physically sick. I have savings with IceSave and am worried I may lose them.

That said, IceSave accounts are covered by a guarantee from Iceland's equivalent of the FSA (up to around 21'000 Euros) with the remainder (up to £50'000) covered by the FSA's compensation scheme.

Unfortunately, Iceland's economy is quite poor and it could be that the Icelandic government create legislation to renege on this deal.

For me it is the "not-knowing" that is worrying. I hope we get some sort of clarification soon.

Update 12:13 - The FSA say we will probably have claim compensation. Fortunately, we should be able to do this through one form from the FSA.

Update 12:28 - Here is great article from the Motley Fool, giving the low-down on the situation with both IceSave and Kaupthing.

Update 13:07 - I just got off the phone with the FSA. There is currently no procedure for claiming compensation because IceSave, at present, have not gone into liquidation (although this is likely in the near future). We are waiting for an official response from the Icelandic government as to whether IceSave will go into liquidation or be nationalised. We will not know how to proceed until this announcement is made.

Update 14:13 - Another interesting article about the situation from The Times.

8th October 2008 - Still no updates from the Icelandic Government. In the meantime, here is a useful Q&A from the BBC News team.

Update 9:00 - Some very encouraging news from Chancellor, Alistair Darling - He says he will back IceSave Savers.

26th October 2008 - The FSCS reveal most of us should have our money back the end of November. They will write to all account holders over the next week or so.

I've been using an IceSave Savings Account for about two months now and I've had a lot of people asking what I thought of it, so here's a review of the product and my impartial opinion.

The Bank
The IceSave account is operated by a subsidary of Landsbanki based in Reykjavic, Iceland. Landsbanki is a well-established (and the oldest) bank in Iceland, so bankruptcy is very unlikely (Update: I was wrong!). They also subscribe to the Banking Code, which creates, ensures and enforces fair dealing and good banking practices to consumers.

The Account
The two main reasons I opened an IceSave account were its fantastic interest rate (currently 5.45% gross, 4.36% NET for basic-rate tax payers) and the guarantee that the interest rate would stay at least 0.25% above the Bank of England base rate. The base rate increased to 5.25% this week, which means the IceSave interest rate will go up to at least 5.5% very soon. The guarantee lasts until October 2009.

You can opt for interest to paid monthly which reduces the gross interest rate to 5.32%.

The IceSave account is open to all UK residents aged 18 or over for savings between £250 and £1 Million.

It is an online savings account, so you don't receive much post from them and can view transactions 24 hours a day.

Opening an Account
To open my account, I simply visited their website and filled my details into their online application form. I also set up a Direct Debit with them for transferring funds to the IceSave account from my current account.

A few days later, I received my welcome pack and login details and went straight to their website. I logged in and changed my account so it paid interest monthly before setting up a small Direct Debit of £300. Just under a week later, the money was in my IceSave account so I transferred the remainder of my savings over, which again took about 5 days.

Online Banking
The login procedure for IceSave's online banking consists of two parts. Firstly a username and password is required (this is sent through the post when you open an account). Secondly, you have to select three characters from either a memorable name, date or place (you choose these when you are opening an account).

The first screen after logging in shows your current balance and has links to view your statement, change your details, make a transaction or log off. The interface is simple and uncluttered and very easy to navigate. Performing any action is pretty much self-explanatory.

Conclusion
On the whole, my experience of the IceSave account has been a good one. I've experienced no problems, transactions have been quick and operating the account is painless. I've never had to call up customer services, so I can't comment on that however, I did have a small query that I sent them via e-mail that took about a week for them to respond to. I would have expected it to be quicker but that is my only gripe.

I'm very happy with my IceSave Savings account and expect to continue using it in the long-term.

I found out yesterday the the Post Office can provide your home telephone service and after the experience I had yesterday, I'm glad I don't use them.

I popped round to see my mum on my way home from work and she informed me her telephone wasn't working. I had a look and sure enough, there was no dial tone. Obviously my mum couldn't call the Post Office to log a fault, so she asked if I could do it. "No problem," I said and when I got back home I gave them a ring.

After being on hold for 15 minutes, I got through to an advisor and I explained the situation to him. Something along the lines of the following conversation ensued:

PO Rep: "Unfortunately you can't raise a fault on your mum's behalf."

Me: "Why not?"

PO Rep: "It's against the Data Protection Act."

Me: "I work in IT and so I'm pretty familiar with the Data Protection Act. Which part of it stops me logging a fault on my mum's line?"

PO Rep: "It's to do with personal details, so we're not allowed to do it."

Me: "I'm not asking for personal details, I just want to inform you of the fault and raise a call to sort it out."

PO Rep: "Well..er..it's in the terms and conditions."

Me: "What's in the terms and conditions?"

PO Rep: "That only the subscriber can log a fault call."

Me: "But she can't log a fault call - her phone line doesn't work."

PO Rep: "Can she use a mobile?"

Me: "She hasn't got a mobile?"

PO Rep: "Is there a phone box nearby that she can use?"

Me: "Your telling me I've got to tell my mother to go out late in the evening and find a phone box to call you?"

PO Rep: "I'm afraid that's our policy. Your mum will have to call us."

Me: "But she can't, can she? Have you any idea how ridiculous this is?"

PO Rep: "I understand but my hands are tied."

etc. etc.

I've got to hand it to the guy I was speaking to. He was calm and polite throughout the call and sympathised with the situation I was in.

In the end, my mum had to get a friend to pretend to be her to get a fault raised. She's now looking for another telephone provider after encountering the stupidity of the Post Office head-on. My mum's always been a big supporter of the Post Office in the past (much to my disapproval as their offers are almost always uncompetitive), but I think that she's finally seen the light and the Post Office have lost a very good customer.

I mentioned in this previous post that one of my goals for 2007 is to donate 1% of my income (excluding gifts and cash from my 'doubling plan') to a charity. So, this week, I've been searching for a charity to support.

After a lot of thought and a lot of research, I decided to choose BDF NewLife as my charity for 2007. They focus on helping children with birth defects and their families. They do this by buying specialist equipment, providing guidance and support to families and funding medical research.

I did intend to make this post a bit longer by detailing my research and decision-making process, but decided against it for three reasons; 1)I didn't want to offend other charities with my individual views, 2)Some of my reasoning is very personal and isn't something I particular want to discuss here, and 3)Apart from the budgeting aspect, it doesn't have a lot to do with personal finance, which is the remit of this journal.

I'd also like to add that BDF NewLife do not spend an awful lot of money on marketing and branding, preferring to use their money directly where it is required. I, myself, had never heard of them before I did my research. So, I hope this post has raised awareness of this charity amongst my readership and if any of you are thinking about being charitable, please consider this organisation.

Something I do every 12 to 18 months is check the balance of the account I have with my gas and electricity supplier (currently NPower). I pay a set fee by Direct Debit every month but I've found that suppliers often over-estimate how much they think I'll use resulting in a build-up of credit.

I feel that I am pretty clued-up on financial matters. I can read financial reports from PLC's and keep my accounts in a double-entry book-keeping system, however I am unable to understand the bills I get from NPower. Therefore, I have to call them up to find out by how much I am in credit or debit.

After being put on hold for fifteen minutes, I got through to an advisor who informed me I was in credit by just under £100. I told them to credit most of it back to my current account.

Having put down the phone, I got to thinking that holding on to their clients cash must be a nice little earner for NPower (although NPower is my supplier, this is equally true for the majority of other gas and electric providers).

For example, assume that NPower have 100'000 customers each with an average of £50 in their account (technically, it's NPower's account). That amounts to £5 Million of customers money sat in their bank account. And if we assume an interest rate of 2%, they're earning £100'000 of interest from it.

As you can see, I've used very conservative estimations above, but even so I think it demonstrates how sound this tactic is. I must add that I have no problem with utility companies doing this. I actually think it's a marvelous idea on their part. But I would prefer my readers to earning the interest rather than the corporations, so sometime this week, give your gas and electric supplier a call and see if you're in credit. If they're holding some of your cash, tell them to give it back.

This series of articles was inspired by a wealth-building strategy created by Stuart Goldsmith. It is called 'Double Your way to a Million' and you can sign up for your free copy on this webpage.

I made the mistake of leaving my 'doubling pot' on the table in full view of my 3 year old daughter. When I got up this morning, I discovered she'd got her hands on it and scattered the coins around the house for, as she described it, a Treasure Hunt.

We spent a good couple of hours literally taking the house apart looking for them. We decided to call it a day after we'd managed to recover all but 2 pence of my money. So a loss of 2p but a lesson learned. Kids are great!

Step 9 in progress.
Cumulative Cash: £1.56

I've just completed my yearly budget. I do this at the beginning of every year so that I can keep on top of my personal cash-flow. Knowing exactly where my money will be going and when is imperative for staying in control of my money (and staying in the black).

Some people prefer to budget on a month-by-month basis, indeed I used to do it this way myself but I found that some months can be much more expensive than others. For example, in April I pay both my car and home insurance (usually costs between £400 and £500) and in July/August, we go on holiday (upwards of £600). I feel that budgeting on an annual basis makes me much more prepared for these kinds of one-off expenses.

I thought in this post, I'd share with you how I go about preparing my budget.

How To Budget for the Year
The first thing I do is make a list of all my regular monthly expenses such as utility bills, mortgage payments, petrol and groceries along with an estimation of their cost. You can get this information by going over old bank statements.

I then use an awesome piece of software called GNUCash, which is a free open-source double-entry book-keeping system. Not only does it record all my transactions, it also produces nifty reports and graphs that makes analysing my financial situation much easier than looking at the numbers. Unfortunately, it only works on Linux-based operating systems (no Windows version, I'm afraid). If you want to give it a try I recommend downloading Ubunbtu Linux and installing it on your computer. Remember to read all documentation first!

I then input all the monthly transactions into GNUCash, along with my monthly salary. It is important to make sure that the transactions are recorded on the date they will be paid (or as close as possible) so that your cash-flow is as accurate as possible.

Next, I input monthly transactions for the money that I will be saving, which currently stands at 12% of my gross salary.

I then make a list of things that I'll have to buy just once in the year. Examples include insurance, road tax, birthdays and holidays. Once I have an idea of these costs, I work out how much I will need to put by each month to pay for them. I find that I have to play around with the dates and figures a little to make sure I have enough money to pay for them at exactly the right moment.

Having budgeted for the necessities, I now have an idea of how much I'll have to spend each month on what I call 'Cash Purchases'. I always carry a little cash around for small purchases such as a loaf of bread, a trip to McDonald's, a light bulb or a few drinks down the pub. Basically, whatever is left over is my spending money for the month. While I'm doing this, I make sure that I have cash left over at the end of the year for January's bills and that I don't go into the red at any point.

And that's it. It takes a couple of hours but I know where my money is going and when. Additionally, at any point I can run a report to see how much I've paid a particular supplier or the sum of my total assets plus a whole load of other information in an easy to interpret format.

My Personal Budget
My own budget divides my salary income into the following categories:

Taxman (Basic Rate Tax-Payer plus National Insurance) - 28%
Monthly Expenses (including Cash Purchases) - 44%
Savings - 12%
One-Off Necessary Expenses - 10%
Fun (Holidays & Days Out) - 5%
Charity - 1%

For the first-time this year, I have budgeted 1% of my gross income to be donated to a charity. One of the jobs on my task list is to choose a charity to give to. I want to do this because I get immense satisfaction from knowing that I have helped a worthy cause - so you could say it's a selfish desire.

I have decided to use a similar model for any other earned income (i.e non-salary income that isn't interest or dividends). For example if I make £100 by selling something on Ebay, £28 will go to the taxman (not a lot I can do about that), £12 will be saved, £10 will boost my one-off expenditures account, £5 will be spent on entertainment and £1 will go to charity. The remaining £44 would be used in whatever way I feel. For example, I may add it to my savings or take the family out for the day.

So now I've reviewed my performance in 2006, set out my goals for the year, completed my budget and decided how my income will be used, I'm ready to put my nose to the grindstone and make 2007 a year to remember.

Bye for now.

As I mentioned in a previous post, I regret that at the beginning of last year, I didn't think about or write down my financial goals for the year. I feel that if I had, I could have achieved more. Without annual goals, it is very difficult to assess your progress at year-end and contributes to a loss of focus. If you are not aiming for something specific, it is hard to make the right decisions that will help you to hit your target. Before you make a journey, you need to know where you want to end up.

Consequently, this year I have made a list of financial goals that I want to achieve over the next 12 months as well as my long-term dream that I hope to have completed before I hit 50 years old - in 22 years time.

My Dream
My ultimate dream consists of four goals:

1. Retire at the age of 50 and be financially free to pursue whatever I desire for the remainder of my life.
2. Earn a residual income of £100'000 every year from savings and investments.
3. Have a net worth of around £6'000'000 (Six Million Pounds).
4. Own outright and live in a manor house (I've already done a rough sketch of the plans).

I have done a little research, and similar properties to my dream home can be bought for around £2'000'000. I may have it built to my exact specifications or buy something close to my desire. I estimate it will cost a further £1'000'000 to furnish it.

To earn an annual residual income £100'000, I would need a capital of around £3'000'000 earning between 3% and 4% of interest each year.

Hence, with a £3'000'000 home (including furnishings) and £3'000'000 "in the bank", I would have a net worth of £6'000'000.

Goals 2, 3 and 4 are really requirements that give me the freedom to achieve step 1, which is my Primary Aim. When I hit 50, I want to be free to do what I want when I want with few financial constraints. To have this freedom is my ultimate dream.

Despite the dizzy heights of my aspirations, I believe I can do it.

Annual Goals 2007
Coming back down to earth, but keeping my dream in the back of my mind I have set myself the following (much smaller) goals for 2007:

1. Save at least 12% of my salary (£3'000) to use in worthwhile investments.
2. Set up Savings Accounts for my children - They currently have poorly performing accounts and I have been putting off this task for years. This year, I will knuckle down and get it sorted out.
3. Choose a worthwhile charity that appeals to me and donate 1% of my gross income to it - I've done my figures and can afford a little philanthropy.
4. Set up and run at least one limited company - I feel that an important part of achieving my dream will be through running profitability business(es). This is something I've never done before, and so I need to learn many aspects of business (management, sales, marketing, book-keeping etc). By making myself a business owner, I will be forced to learn these essential skills.
5. Earn at least an additional £5'000 in income - There are many ways to earn money without being an employee and I plan to put great effort into learning some of them.
6. Invest at least £1'000 into assets that earn more than the best savings accounts can offer (currently around 4.3% after tax) - To reach my ultimate goals, I think I need to start looking for and finding opportunities that yield more than the banks.
7. Complete steps 9 to 16 of my doubling plan - This project is running separately to my personal financial plan, however if I manage to reach the end the £1 Million will be a welcome addition to my finances.

So, there you have it. I expect some will laugh when they see my long-term goals and think that I'll never achieve them. All I can say is that I'll never know unless I try.

Much like the compilation episodes that are strung together by television series producers when they haven't got any new material this post will take a look back over the previous 12 months and summarise my achievements for 2006.

January
In the first month of the year, I had a very unsettling experience with the ICICI bank, which resulted in them losing a customer for life. Conversely, I had a very pleasant experience with the Alliance + Leicester when they gave me £150 and my mum £50 simply for opening a Premier Direct Account.

February
The only month of 2006 in which I didn't make a journal entry.

March
I learned a very valuable lesson - that I shouldn't forsake my family and friends for money. Thirty pound spent on a nice meal in the company of loved ones is a fantastic investment.

April
April saw the launch of this website into the public domain. Previously, I had been updating my journal privately but I decided to publish it to the masses in the hope it would provide useful information and an entertaining read. Additionally, in April, I realised that I had not been following Clason's advice properly which resulted in me rearranging my finances.

May
May was quite a busy month for me. The money I had saved over the previous year or so was now available for worthwhile investments, so I set about finding some. I bought Premium Bonds and dabbled in the stock market for the first time by buying shares in my ISP, Plusnet. A week or so later, I increased my stake in Plusnet. I also opened a Monthly Saver account with Lloyds TSB, as well as writing a book review of 'The Richest Man in Babylon' by George S. Clason, writing an article entitled Top Ten Tips to Increase you Wealth and talking about my money box.

June
In June, I got a GE Money Credit Card, which gives me 3% cashback when I use it to buy petrol or groceries. I also tested a gambling strategy during the FIFA World Cup.

July
My biggest achievement of the year occurred in July - I stopped smoking. And the best part was it was much easier than I thought it would be (having failed many times before). I also updated the progress of my Plusnet shares and wrote a book review of Robert Kiyosaki's 'Rich Dad, Poor Dad'.

August
I decided to analyse Warren Buffet's letters to Berkshire Hathaway shareholders, which contain some great investment advice from arguably the world's best. The first letter I analysed was from 1977. I also decided what I would do with all the extra money I would have due to quitting smoking.

September
I analysed Warren Buffet's 1978 letter to shareholders.

October
A very busy month. I analysed Warren Buffet's 1979 letter to shareholders as well as releasing the prototypes of my Mortgage Calculator and Regular Savings Calculator to the world. I reduced my expenditures by changing my telephone provider and updated the progress of my Plusnet stock. I collected the cashback from my Morgan Stanley Credit Card and closed my A+L Premier Direct account. Finally, I began to cut down our grocery shopping bill and wrote an in-depth article on earning over £100 using Quidco.

November
In November, I continued to reduce our grocery bill as well as writing an article describing my Top Ten Tips. I had a bit of a moan about feeling constrained as I couldn't invest my money due to our house being on the market, however I did find a cracking savings account (IceSave) that I transferred my money to. November also saw me begin my 'doubling to a million' project and making my way to step 7. I also gave honourary mentions to other doublers I'd found. Click here to see all doubling posts.

December
December saw the first issue of my newsletter, I sold my Plusnet shares to BT and completed step 7 and step 8 of my 'doubling to a million' project as well as making some progress towards step 9. I described my experiment for super-unleaded petrol economics and published my financial report for 2006.

In summary, I feel I've achieved a lot over the last 12 months. It's certainly more than I achieved in 2005 and quitting smoking is one of the biggest achievements in my life.

Another year has begun and I wish you all a healthy, wealthy and happy 2007.