Physician from Belgium, 33 years old, on the way to financial independence - any pointers?

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shaokim
Posts: 9
Joined: Sat Mar 09, 2019 4:15 am

Physician from Belgium, 33 years old, on the way to financial independence - any pointers?

Post by shaokim » Wed Jan 08, 2020 10:02 am

Hello,

I would just like to start a personal thread, to get some advice from the more knowledgeable people around here, who could help boost me on the way to FIRE.

I am a physician, 33 years old. Through circumstances, I have only started steady work since the beginning of 2018. I am now on a gross salary of 6250 euros a month, which will be raised to 7000 euros per month starting next month. In addition, I can take optional call, for about 200 euros on weekdays and 400 euros on weekend days.

I have just bought an apartment, worth about 240k. The mortgage is a fixed rate of 1.55% over 20 years, for a monthly sum of 1250 euro. Total monthly expenses, including mortgage, vary somewhere between 1800 euros and 3000 euros, mostly around 2500 euros.
I have started a partnership (vennootschap) since July this year.

I have started investing 500euros monthly in IWDA since May last year, with the exception of buying EMIM once a year (this January). There is a bit more than 6000 euros in these investments right now.

Reading some recent stories on here from compatriots about my own age, I'm very much wondering if there's lucrative roads I am not exploring yet. With the mortgage left to pay, and about 30 000 euros on my bank accounts, much of which will be going to taxes and social contributions, I reckon I'm in the red when it comes to net worth, considering my remaining mortgage.

I'm asking for advice, given my financial situation, if I can do more to boost my progress. Several people on here seem to have gotten rich of real estate, however, I don't think I'm financially healthy enough to considere that route. I also heard advice that for Belgians, if you want to stay as hassle-free as possible, it's probably better to just invest in an ETF that covers REIT (such as IWDA).

I figure the most reliable route to boost my earnings, would be to do a medical traineeship to be a specialist. However, such an endeavour would last about 5 more years at less than half my current wages, which would make carrying a mortgage difficult. It's also hard and competitive to get into a traineeship, and the life of a specialist is generally very taxing when it comes to working hours, while I currently have a workweek of somewhere between 35 and 40 hours, call not included.

Any advice would be greatly appreciated
Thanks
Subreddit dedicated to financial independence and early retirement in Belgium: | reddit.com/r/BEFire

international001
Posts: 1468
Joined: Thu Feb 15, 2018 7:31 pm

Re: Physician from Belgium, 33 years old, on the way to financial independence - any pointers?

Post by international001 » Wed Jan 08, 2020 10:55 am

Are those $6k-$7k net or gross. I assume gross and you have to pay taxes on it. Otherwise, it would seem the mortgage of $1.2k is not too much

Usually rents are similar to mortage payments. $240 for $1.2k/month is a good deal to invest on real estate. If net profitability is > 5% and it's easy to rent, you can consider it. Some here are in favor some against. In anycase, I would do it once you get some more savings.

For your level of savings, you may want to diversify bonds with some stocks. You never know if you'll need the money for an emergency. Also, consider some funds because they are easier to rebalance (perhaps in Belgium is tax-free to rebalance across funds).

For the change of job, you can do an spreadsheet and estimate future earnings, loss of income, etc to see after how many years you'd come ahead. Consider the discount rate you want to use, common value is 5%. That's just the financials, consider the personal also.

I think Belgium pension plans are not great ($1k a year?) , but try to make use of them. I don't know if there is any other way of avoiding taxes, what would be really good, since they are so high in Belgium

Did you check this?

https://www.bogleheads.org/wiki/Investing_from_Belgium

RadAudit
Posts: 3856
Joined: Mon May 26, 2008 10:20 am
Location: Second star on the right and straight on 'til morning

Re: Physician from Belgium, 33 years old, on the way to financial independence - any pointers?

Post by RadAudit » Wed Jan 08, 2020 11:02 am

Here's where I started https://www.bogleheads.org/wiki/Main_Page Click on "getting started" if you are really new to all this. There are forums / threads for non-US investors.

I think this might be an additional web site that may help. https://www.whitecoatinvestor.com/ Don't know for sure. I'm not a doctor.

Best of luck.
FI is the best revenge. LBYM. Invest the rest. Stay the course. - PS: The cavalry isn't coming, kids. You are on your own.

User avatar
BeBH65
Posts: 1651
Joined: Sat Jul 04, 2015 7:28 am

Re: Physician from Belgium, 33 years old, on the way to financial independence - any pointers?

Post by BeBH65 » Wed Jan 08, 2020 11:16 am

Have a look at this wiki page My_portfolio:_seeking_advice
- What is the goal for your investments?
- What is your risk tolerance?
- What is the size of your emergency fund?



Do not count the taxes that you own your own! This money is owned by the government, temporary under your custody. How come this amount is soo big? Do not take any risk with this money. Consider augmenting what you pre-pay to ensure you have no big tax bill at the end of year, at teh end of 3 year.



Bogleheads_investment_philosophy
Looking at the principles, I would suggest:
1 Develop a workable plan >> this is what you are doing now
2 Invest early and often >> earn more, spend less, save more
3 Never bear too much or too little risk >> you need to determine how much risk you can bear, and adjust your portfolio. You have 100% equity, whart if the morket descends 50% and stays there for many years?
4 Diversify >> think about non-equity investments; for stability.
5 Never try to time the market >> OK
6 Use index funds when possible >> OK
7 Keep costs low >>OK
8 Minimize taxes >> talk to your accountant on the optimal way to structure your company and the renumeration you take from it. Look at company based deferred-taxation plans VAPZ and IPT, integrate them in your plan.
9 Invest with simplicity >> OK
10 Stay the course >> TBD - you take a lot of risk. Your investements might be volatile


One does not become "rich" through investing.
+ Better approach is : earn more, spend less, save more; have a look at networthify.com
+ Many consider real-estate management as a second job...
BeBH65. (only an investment enthusiast, not a financial adviser, perform your due diligence). | Have a look at https://www.bogleheads.org/wiki/Outline_of_Non-US_domiciles

mhalley
Posts: 8290
Joined: Tue Nov 20, 2007 6:02 am

Re: Physician from Belgium, 33 years old, on the way to financial independence - any pointers?

Post by mhalley » Wed Jan 08, 2020 12:24 pm

I suggest subscribing to white coat investors newsletter and reading his blog. You’ll need to filter out the stuff about the US tax code.
https://www.whitecoatinvestor.com/new-t ... tart-here/
A couple of good posts to get you started
https://www.whitecoatinvestor.com/the-1 ... -investor/
https://www.whitecoatinvestor.com/150-p ... han-yours/
https://www.whitecoatinvestor.com/8-ste ... attending/

international001
Posts: 1468
Joined: Thu Feb 15, 2018 7:31 pm

Re: Physician from Belgium, 33 years old, on the way to financial independence - any pointers?

Post by international001 » Wed Jan 08, 2020 6:05 pm

What is so specific about investing when you are a doctor?
Particularly between a Belgian doctor and a US doctor, I would think situations differ quite a bit.

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