My family’s expanding cost base (and how I’ve adapted)

When I was single, life was a lot more straightforward. I didn’t have to persuade anyone to put their shoes on before leaving the house or explain why being outside on our city street in one’s underwear, might send the wrong kind of message to our neighbours.

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I have many fond memories of nice meals with my wife and romantic vacations where you had ample time to whisper sweet nothings to each other, strengthen your relationship, experience something new (e.g. diving), rest and recharge your batteries. I often reminisce about reaching my state of “peace” which took about 10 days before coming back to work physically, mentally and spiritually rested.

Then, the kids came…

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I don’t think anybody can prepare you for kids. Every try taking a 7 hour flight with three kids (the youngest of whom is diabetic), landing in a different timezone, trying to pass through immigration holding heavy luggage while your 4 and 6 year old are kicking each other in front of the immigration officer? No? Enjoy your single life!

I’m not saying I don’t love my kids, I do, I’m not saying I wouldn’t do anything for them, I would run through brick walls but the word to best describe parenthood is “relentless”. It doesn’t stop and it comes at you from a lot of different angles, physically, mentally and financially.

My wife and I work, we have well paid jobs, live in a nice house and have some investments. Our monthly outlay is huge (we need a full time nanny for our diabetic kid) and it’s only going to get bigger.

Combating the expanding liability

Since our first son was born over 6 years ago, I’ve felt like the proverbial rodent on the hamster wheel. Spinning away but never feeling like I can save anymore and I’m tired because I need to work harder even though I’m getting older.

They say the universe is continuously expanding, it really sounds like my cost base post kids! I’ve somehow managed (with my wife) to generate more income since the kids came along to combat the liabilities.

I hope I can share some of my knowledge with you and give you some food for thought.

What I’ve invested in to combat the expanding liabilities is:

• Real Estate
• Airbnb
• Cryptocurrencies
• Physical precious metals
• Paper commodities, foreign exchange, stocks and indices.

If you would like more color on why I invested in these asset classes and how I’ve fared with them, please click on the links above.

In summary though, out of all of the asset classes listed above, cryptos have been by far the most profitable for me personally. I think Airbnb is a profitable solid steady monthly income but it’s all encompassing and you have no time off around Christmas or New Year for instance. Maybe a marriage of both these asset classes would be the way forward?

Conclusion

People say you need to have 5 different income streams to be financially independent, this sounds about right to me. Some of my assets are liquid, some of them are less liquid. You have to decide what your risk appetite is and what you want to invest in yourself.

Take out a pen and a notebook, this will be well worth planning.

Kids are expensive, you can cope with expanding cost base but you’ll need to work extra hours and have a plan.

May the force be with you all!