I use N26 as my bank and like it. Revolut and Monzo are nice too.
I try keep a minimum of ~ 3000 euro cash on my account (for emergency spending + any monthly bills). Rest in invested in strong assets. Often this 3000 euro cash goal is aspirational and I can barely afford food.
Tax wise, at least in Europe, you pay ~ 21% VAT every 3 months. You then pay income tax once a year, at least in NL all that's done through a website. Income tax is often progressive so amount you pay depends on how much you earned in the year.
I found asking ChatGPT questions regarding taxes/finances very useful. Do double check though as model can hallucinate.
There are ways to avoid paying the tax if you don't stay a tax resident in any one country for prolonged time (usually 180 days). But I haven't tried doing that.
I do budgets on quarterly bases as I send in my revenue for 3 months to pay VAT tax. Anything beyond the 3000 cash goal gets invested into my portfolio of stocks/ETFs at each end of month. Might automate it at some point.
Aside from investing in ETFs, I use the money to invest in ideas that interest me. Pay open source contributors whose libraries I like. And generally try to give back to community on whose work I build on.
I try reflect on my progress both financial and otherwise as part of my look backs.
I want to build an app to help manage my finances better as well keep track of invoices I send and which invoices I paid out more easily too. Currently it's quite messy. I tried using Notion for it and it looked something like:
In some ways it's a light variation of YNAB methodology. Goal is to be mindful of how the money gets spent monthly to make projections into future. Thus removing anxiety for potential future unforseen expenses.
I try to be mindful of more expensive things I buy but do try to never disregard spending money on quality healthy food and essentials for my well being. All modern banks including N26 track spending into categories automatically.
As mentioned above, I want to build an app that would automate all things financing, safe investing & bookkeeping for me. Where tax is optimized based on all information that is available to me and payment of tax is easy as all the bookkeeping details are neatly organized.
Fey app looks interesting in this regard although it's focused on investing.
The app should:
- Read live data from my bank(s)
- All expeses automatically categorized (I should be able to instantly see how much was spent on what and how that change over last month or any other time period) (can get categories either from bank itself or write my own classifier)
- Ability to make projections based on historical data
- Ability to set goals on total value of assets
- Ability to set limits on categories and ideally have the bank enforce those limits or at least remind me when I went over the limit as the app reads live data from the bank as each transaction gets made
For connecting to real time bank data, maybe Nordigen or Tink can be used. Hopefully it's not too expensive to do.
Actual Budget is in some ways close to what the UI for such an app should look like but it doesn't let you connect to EU banks.
This person's Notion setup is close to the idea too.
It would also be nice to automate moving money from main account to good ETFs I select. FIAT tends to deprecate quickly so it's good idea to own hard assets (good ETFs being the safest investment).
I use Interactive Brokers currently to make investments but honestly wish there was something better. The UI/UX of IB is horrendous but you can't easily purchase ETFs in any other app as EU citizen (I think at least).
If I needed a bank in US, I'd probably use Mercury or Column
In EU, I'd use Wise.
For processing payments on websites/apps, Stripe Payment Links are easy to setup but the pricing is steep so avoid Stripe now in favor of Adyen.
Ideally Adyen builds better integration points with as much care into integrations as Stripe has.
Lemon Squeezy is nice tool to simply sell items online. Paddle is nice too. There are other options though.
My personal goal though is to minimize fees I pay on each transaction over how nice DX is as I can abstract that away. Thus Adyen seems like a perfect company.
In future I'd love to build some things on top of global payment infrastructure and get those fees closer to minimum as possible. Perhaps by building on something like TrueLayer as you need a banking license to innovate in fin tech.
Use Invoice Generator or Cakedesk to create invoices but I do need to make something even nicer and more automated for my use cases.
Ideally anything related to finances is automated as much as possible for me.
Minimum Viable Finance is a nice article to read to get a better sense of things you need to know as you try finance your own startup.
I use Bobby iOS app to track my ongoing subscriptions. I review it monthly as part of my finance check up. The app I mentioned above will cover the use case of Bobby too so hopefully I won't need this app in future.
Tracking what to buy next
I use 2Do to track what things I want to buy next. These are just tasks with
buy tag in 2Do sorted by priority. Here is how it looks:
- FI is possible everywhere. The idea stays the same, save more than you spend, try generate passive income through stocks, dividends and property.
- I think most people are going to mention credit cards in some way, but for me, it was how my actual bank accounts don't matter. It doesn't matter if I have $X in my savings and $Y in my checking account. I have $(X+Y) to budget and I need to budget $X for an emergency fund.
- Also, having $Z left over after budgeting doesn't mean I have $Z to blow. I have $Z to budget for next month since I already budgeted for my frivolous spending. That doesn't mean I don't just move $Z to something frivolous anyways.
- It's a different way of thinking about budgeting. It's an envelope system. You have a pile of dollars (real dollars - these are all the dollars you own, right now, in your accounts), and a pile of envelopes. You begin stuffing dollar bills into envelopes - some into the bills coming due before you get paid again, some for groceries until you get paid again, some for gas until you get paid again, and with the smaller pile of dollars after those needs are taken care of, you begin to stuff dollars into your True Expenses - things like Car Maintenance, Insurance Payment, etc. When you run out of dollars, you STOP.
- You stop, because you can't put imaginary dollars into envelopes.
- YNAB is all about the now - about giving jobs to the money you have. Not to the money you might have later on. It is a different way of thinking, but once you make that mental shift, it comes clear and works beautifully.
- Invoiced has great invoice generator.
- IBKR trades currency for you on the actual market at whatever price it's currently trading. No fee. Perfect for exchanging FIAT.
- After the financial crisis, banks were more tightly regulated, had to hold more capital, and the fed eventually started paying interest on excess reserves, so it should be fairly obvious that this means banks are encouraged to just park (some) of their reserves.
- You have 2 ways of receiving money, as an individual or as a company. If you need to spend your money you are going to be subject to personal income tax laws. There are 2 ways to reduce this kind of tax, run a legitimate business that enables you to write off big day to day spends (like run a catering company and you eat the food it buys) or move to a country with favourable income tax breaks for new residents (Greece/Spain). If you plan on saving your money then you can start a legitimate business in a country with low or zero income tax (Estonia, Caymen islands). That business could be to buy property or an investment vehicle, that way you can benefit from keeping more of the money pre tax accumulating in interest before it's taxed on your personal income tax. Saying all that, it's a lot of work to figure it all out and make the pieces fit, or expensive to hire a good accountant to figure it out for you. Especially if you have an average income where your only saving a few thousand I'm tax a year.
- If someone not paying their invoices for long time: First, create a paper trail of contact. Call them and follow up with an email documenting your call attempt and repeat your collection message. Continue this several more times as needed over several days. Only then escalate to an attorney letter. This process gives your attorney more firepower for the letter. Let them know they have x days until litigation, cc them with records of contact so they can't deny and let draft a very formal letter letting them know you have already taken steps to contact the people to take this to court. The very threat of having to deal with the court proceedings usually does the trick. I had the same thing happen (for less money mind you) after the letter was sent they paid almost the same day.
- I call our cell phone/ internet company every once in awhile and ask for a discount. It's normally works. Just got a $25 discount off our cell/internet bill today. You can always look up rates of competitors and then claim you are going to switch. That normally gets them to go lower.
- Important saving goals people should have
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- Best software for submitting receipts
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