#168

Time Tracking

Firstly, I completely stopped tracking my time. I started this about a year ago and, while it was kind of interesting seeing where I spend my time, how much of the average workday is meetings, what proportion of my time is leisure time, and so on, I found myself very rarely actually analysing (or even just glancing at) the data I was working to produce. And, problematically, it never really became a habit. I always had to think about tracking my time and, since I didn’t want to go down to the level of counting individual minutes, I found myself putting off or batching small tasks together, which made those small tasks feel bigger and more cumbersome.

Even worse, since I had a goal of having under 2 hours of untracked time a day, and yet I only tracked time I was actually doing things, there was a pressure to only relax by doing the specific activities I’d given categories to: reading a book, going for a walk, working on a project, watching anime, and so on. It’s good to do those things, but sometimes it’s nice to just laze around for an afternoon, and I was discouraging that.

So, on Friday, I stopped.

At first it felt a bit weird, but that passed very quickly. I feel like a weight which I was no longer conscious of has been lifted. This weekend I’ve found myself doing a greater variety of activities than usual, I suspect because there’s no longer an overhead to switching activities or doing very short activities.

On the whole, I don’t recommend time tracking the way I tried it.

Personal Finances

Secondly, I threw out a cornerstone of my personal finances: I got rid of my emergency fund.

I make myself financially resilient in a few ways:

• I keep 3 to 4 months expenses in cash in my bank account.
• I keep a £5,000 emergency fund in Premium Bonds.
• I also keep a £2,500 moving fund in Premium Bonds.

Having a few months expenses saved up is the best first step you can take (after getting rid of any high-interest debt, that is) to make yourself financially stable. This lets you break the cycle of living paycheque to paycheque. I’ve adjusted how much I have saved in this category over the years, and now I have 4 months for most types of expenses. Since I’m paid on the last working day of the month, and expenses will usually have come out before then, this means over the month my bank account dwindles down from 4 months expenses saved to 3, and then shoots back up to 4.

Honestly, this is probably more than I need. My job is very stable and has a long (3 month) notice period, so I’m not going to suddenly lose it. But this number gives me peace of mind.

After breaking the cycle of living paycheque to paycheque, a good next step is saving up for uncommon or unexpected expenses. Money for uncommon expenses (like my annual ProtonMail fee) I just save in a bank account. So, it’s only unexpected expenses (like needing to move) that the money in Premium Bonds is for. Once, I didn’t have a separate moving fund: I just had a £10,000 emergency fund, but I changed that in 2020.

This week I’ve made some changes:

• I still have 3 to 4 months expenses in cash in my bank account.
• I’ve completely removed the £5,000 emergency fund.
• I’ve shrunk the £2,500 moving fund to £1,000.

I realised that I’m very unlikely to need to use my emergency fund: if an emergency comes up, I’m more likely to pay for it with my credit card or by reallocating money from another budget category, than I am to wait the 3+ days it takes to withdraw from my Premium Bonds. In fact, I’ve only used my emergency fund once, when I unexpectedly needed to replace the NVMe drive in my desktop computer, and I could have just taken the money from (say) my rent budget instead.

The moving fund is a slightly different story: I realised it was just too much. I picked £2500 because that’s about how much I spent in total when I moved to my current flat in 2019: but I only spent that much because I bought a lot of new furniture. I have that furniture now, I’m not going to replace it when I next move. But on the other hand, hiring movers will be more expensive now that I have more stuff to move: it cost me £400 last time, so allocating more than double that feels safe.

Now, having said all that, the money sitting around in Premium Bonds isn’t exactly harming me, is it? Well, it probably is! I’ve won £25 in the Premium Bonds since January 2020, so that’s a return of 0.3%. Pretty bad. On the other hand, my S&S ISA has had an annualised return of 15%, so if the £6500 I’ve now freed up had been invested for the last two years, it would now be worth £8500. Stocks and shares can, of course, go down as well as up (which is why you don’t store an emergency fund in them): but in the long term (5+ years) they tend to go up.

I’m planning to update my personal finance memo over the next month or so, as there have also been a few other changes since I last did: e.g., I’m now tracking on my dashboard my FIRE progress.