Learning how to value company shares is not easy and my understanding of company shares is a work in-progress. A work in-progress like a new house being built that isn’t even watertight.

Shares are partial ownership of a company. Buying shares in a company like BP means that you are part owner of the business (a shareholder). You are therefore entitled to a share of the profits.

Profits are paid out in the form of dividends and this is normally annually. It is fair to say that many companies won’t be paying out dividends in 2020 for obvious reasons.

WARNING – if a company issues and sells new shares, it means the value of existing shares will be diluted.


A popular method of looking at the share price of a company is to look at the price/earnings (p/e ratio), and this is the most recent years earnings per share (EPS) divided into the share price.

Lets look at two companies for comparison (Company A and Company B). Company A has p/e ratio of 10. The share price is £10 and you get £1 of profit for every share (10/1 = 10).

Company B has a p/e ratio of 12. The share price is £6 and you get 50p of profit for every share (6/0.5 = 12). Although Company A is more expensive, it has a lower p/e ratio and therefore you get more for your money (if you invested £60 into A and B, A would give you £6 profit and B would give you £5 profit).


Dividend yield is the last full years payout divided by the share price, and is very easy to compare to something like redemption yield on a bond or the rental yield on a property.

For properties, rental yield is the annual income divided by the price. An annual rent of £5,000 divided by a purchase price of £100,000 would equal 0.05 or 5%.


ROI is the annual profit (taking into account taxes and other costs) generated by an asset, divided by the total investment.

I have experience of dividend yield and ROI in terms of rentals and ROI is my preferred method when evaluating the profit of a potential property. This is because it lets me know what rate of return I will get on my investment.

Again lets look a property example. Annual profit is £3000 (RENT – (Mortgage, taxes and other costs))  /  £25,000 (TOTAL INVESTMENT) = 13.3%. When compared to interest rates of savings accounts (<1%), I can see this is good investment.


Value investing has been popularized by Warren Buffet and is buying something for less than it is intrinsically worth. Estimating the likely returns from a company over its lifetime does this. Another easier method is to look at the value of assets on its balance sheet.

To see how much a company is “worth” look at the net asset value. Looking at Robert Kiyosaki’s Rich Dad concepts, this is calculated by adding up a company’s assets and subtracting the liabilities. If the proverbial shit hit the fan, this is what shareholders would own if the company wound up and repaid its creditors.


This is operations money minus capital expenditure or money that can be invested into expanding the company. If a company has millions of pounds in reserve, it is a sign that its financial books are in good working order and that the company is performing well.


Is the CEO or senior management driven and dedicated to the cause. Make sure they are not trying to make the stock price rise so that they can cash out.

This information should be easy enough to find. There will be stories on-line relating to the CEO and you should get a feel for how the business is run at the senior levels.

Just look at Mike Ashley at Newcastle. Although he is a successful businessman and knows how to maximize profits and run successful businesses, he clearly doesn’t care about the long-term future of Newcastle football club. It seems from the outside looking in that him owning that club was all about personal gain from the very start.


The intention here is to improve my understanding of valuing shares so that I can go back and look at companies within my LS 80/20 fund (Vanguard). If I’m going to be investing for the next 20-30 years (current plan), I need to have 100% confidence in the fund I have chosen.

This will also benefit my kids, as it will help me to choose the right fund for their ISA’s.

DISCLAIMER – looking at the methods of valuing company shares, a brief description is provided. There are pros and cons of each method, but I have excluded any of the arguments for and against each method for simplicity.

My 1st run-in with Anxiety

Imagine just for a second, you have become a little nervous, a little bit stressed out, and you are constantly worried about what is going to happen in the future. Or what you think is going to happen.

Your means to an end job is not quite getting you where you wanted to go. The job is coming to an end and you don’t know how long your going to be out of work for. The savings that have dwindled will only last 2-3 months max.

This cycle of working away for long periods is never going to end. If I do get a job at home it will be working 6-7 days a week so I still don’t get enough quality time with ‘my nearest and dearest’. Not only that, I’ll probably still be working weekends in my 50’s and even into my 60’s.

These are the thoughts that I have had on and off for the last 10 years surrounding money. It has brought me anxiety and I have made a conscious effort to reduce my anxiety and if possible, move past it completely.

Being anxious about money has led me to learn about money.

My 1st run-in with anxiety came in 2010 as a 27-year old going from job to job as an Electrical contractor. Up to this point, I was blissfully unaware of anxiety and how much it can affect people’s lives.

It was January 2010 and my contract working on an Oil and Gas Platform (Onshore) was coming to an end. Reading all the negative stories in the press, I was concerned about securing my next contract.

At the time, I was pushing hard to go Offshore to increase my earnings and get some savings as I was almost month to month and didn’t have much money behind me.

My exterior was calm as I tried to take the situation in my stride. Internally was a different story, as the work/money situation was consuming me.

Not only was I over thinking things, I was struggling to catch my breath. As I was working on a Platform I was up and down the flights of stairs throughout the day. This was normally no issue but during this time I was really struggling to breathe as I made my way to the top of the Platform.

As I had Asthma, I just put it down to that and started to use my inhaler more often. This didn’t work so it was time to book an appointment with my local GP.

The Doctor checked me out and my Asthma was perfectly normal. After the breathing checks, he started asking me questions about what was going on in my head. Have I got anything on my mind? And a few other questions I can’t quite remember.

I explained I was thinking about my work situation a lot and he felt I had anxiety. When he explained what anxiety was I agreed and asked what I could do. So he gave me some breathing exercises and told me regular exercise would also help.

Not only was I struggling to breathe, constantly thinking about work and money, I now had anxiety. I was ashamed at the time but there is really nothing to be ashamed of.

My worries were trivial looking back as I only ended up being out of work for 4 weeks. I even got my break Offshore later in the year and we were able to move house.

As I got a few lucky breaks with my career, I have been on some well-paid jobs and have earned good money. My problem was that my expenses soon matched my income. I didn’t know anything about money.

A few years ago my income started to reduce due to the market conditions in the Oil and Gas industry. This meant that my expenses were higher than my income. So my anxiety kicked back in and continued for about 18 months.

At this point I knew I had to do something about it. I had to put a plan together and get my financial act together. I was very much aware that the only person to do something about it was yours truly. Fuck worrying and fuck anxiety.

I haven’t got all the answers when it comes to money, far from it. What I will say is that I am no longer anxious about money or my job.

My plan is to focus on self-education and learn all I can about money so that I can make informed decisions that will help get me my FI or the very least give myself a fighting chance of being comfortable in retirement.

I am fortunate that I am now able to spend less than I earn and invest the difference.

Whether you are struggling at the moment or you are ok with money, either way I would take the time to do a bit of self-education.

This can help you improve your budget skills and help you spend less than you earn. A lot of us in the UK could do with some frugality. If you have spare money it will help you to make investment decisions.

If you have anxiety over money there are many things you can do. Trial and error has led me to a few habits that have really helped me:

  • Meditate – this has definitely helped my stress levels
  • Wim hoff method – a mix of breathing exercises and cold therapy (cold showers are brutal and ice baths are worse but there are many proven health benefits both physically and mentally)
  • Exercise regularly – when I am rolling around on mats (BJJ) or in the gym anxiety doesn’t get anywhere near me
  • Self-education – if I feel like I am making progress and learning I am happy
  • Talk – there is no longer a stigma surrounding mental health any more and more people are able to talk openly about their issues

There are loads of natural remedies but the above are what works for me.

Take care and don’t be getting anxious over money.


FIRE stands for Financial Independence and Retire Early.

Although most people in the UK would probably want a bit of FIRE in their life, it isn’t really a thing for us BRITS.

Many of the self-development books, blogs and podcasts I have read or watched relating to FIRE are based in the US.

Maybe it will grow in popularity after things start to return to some sort of normality? With many people currently struggling to pay bills and put food on the table, it emphasizes the importance of looking after your money.

Many of us up and down the country may have to start to look at our consumption habits and focus on what is important to us.

If you spend what you earn, or worse, more than you earn, it really is time for change. It might be a case of cancelling the SKY subscription or having friends round instead of a night up town. Or ignoring the Starbucks on the way to graft, and drinking the shitty Nescafe that you get for free in the staff canteen.

The very basics of FIRE, is spend less than you earn and invest the rest. This is a habit that could be a game changer for you and your family.

FIRE will mean different things for different people. Like all things money related, it is very much an individual thing. Personally, FIRE for me means enough passive income to cover all of my expenses so that I can choose where I work and what I do for work.

It is not about retiring for me, it is the freedom of choice and security for my family. It means no more Offshore on a shitty Oil Rig sharing a room with some scruff who doesn’t know how to use a toilet brush. No more shitty B&B’s up and down the country tucked up inside my sleeping bag incase I catch something off the rotten bed sheets.

Now that I am working on foreign soil, it means no more deserts in Africa or the Middle East. My tolerance for my means to an end jobs has gone and I am going to push hard for a bit of FIRE.

We have a few choices on how to start heading in the right direction. The first option is to keep the same expenses and look to earn more money pcm. Then you would invest the extra money.

The second option is to reduce your budget and ensure you spend less than you earn that way. Again, you would then invest the difference.

The third option is to do a combination of the two. Look to slice a bit off the budget and get out there and earn more money. I know this bit isn’t easy but it is possible.

An example is to have a normal Monday to Friday job and supplement it with an additional job at the weekend. This may be a bar job or a courier job or even doing some overtime in your current job.

If you do get the opportunity of earning extra money, don’t fall into the common trap of upping your consumption.

Our collective perspectives will no doubt change for the better when things get back to some sort of normality. The normal ball ache of going to the supermarket will become a joy and privilege. As will many other things in this life we take for granted.

It will be difficult to not get over-excited and spend for fun when normal service resumes. Our inner consumer will be busting to spend some money.  What we have to do is stick to a budget.

Over the last 12 months I have trimmed my budget and am now investing the difference. Although it took me 36 years to get my act together, we all have to start somewhere.

Providing we can stick to the plan and work within our budgets, it is time to start heading towards a bit of FIRE.

My preference when it comes to investing is a mix of low-cost index funds and property. My Vanguard Index fund uses algorithms to buy stocks across the market. Depending on what you read the market tends to increase at around 8% per year. The theory is that index funds will follow this pattern.

I have had an up and down journey when it comes to property thus far. Now I know exactly what I want, my intent is to rent houses out for many years to come. A long-term strategy with no intention of selling.

The plan will be for tenants to move in and pay my mortgage off. This way any ups and downs in the market won’t affect me as someone else is paying the mortgage off. As time goes by, I would also expect to benefit from capital appreciation.

If I can buy a property a year for the next 10 years and continue to invest in my low-cost index fund, I can get my FIRE in my late 40s. This may or may not happen but now I have a target to aim for, I feel the likelihood is far greater than before I had any plan whatsoever.

To get some UK FIRE you need to make a start.

Here are some basics to get you going:

Decide what you want.

Get your budget into an easy to use spreadsheet.

Ensure you spend less than you earn – no matter how painful.

Do your research.

Determine what you are going to invest in.

Take it easy.

The Prospect of Digital Currency

In terms of money and the response to COVID-19, the global short-term answer has been to print money and lots of it (QE).

It is becoming clear that the current monetary system is very fragile and the current crisis we are all facing, could tip it over the edge.

Our Chancellor, Rishi Sunak has pledged billions to help soften the impact of COVID-19 in the UK and has given assurances to businesses and millions of workers.

Personally, I am very happy the UK Government are willing to pay 80% wages for employees (up to £2,500) that don’t have the option of work as well as many other measures. The money will help people pay bills and keep the food on the table for many households.

That isn’t the full story and there are some workers up and down the country that have fell through the crack’s when you look at the support that will be given by the state.

My heart goes out to anyone who is struggling and thinking about our financial future and our FI is very relevant in todays frightening world.

Looking at the bigger picture…

Money pumped into the Global Economy year after year is papering over the cracks. With the value of money decreasing all the time, the general public is losing faith in the current banking system. Not to mention the fact that Bankers are widely blamed for the last financial crisis.

Our money is starting to look outdated in today’s digital and technological age.

The basics of the traditional banking system are debit and credit. This is a ledger system called double-entry bookkeeping.  In other words you go to the bank for credit. Then you pay the bank back with interest (debit). To ensure this system works, middlemen are used and that’s where the banking system kicks in.

Before the 70’s, the Global Economy relied on the Gold Standard. After the financial crisis of 1973, the US removed the currency’s connection to Gold and this enabled currencies around the World to fluctuate freely.

Over the last few decades, the entire monetary system (Global) has been based on the dollar as the main currency for trade. This means that the UK and other countries are directly affected by policies made in the US for the US.

There are a few whispers that the IMF (International Monetary Fund) will have more influence in the Global Economy going forward. In theory, they would introduce monetary policy that would look after the needs of the entire world (not just the United States).

Is our financial system getting ready for a big reset? What is the alternative?

The current monetary system is unstable and unpredictable (and that was before COVID-19). I can only see major changes to the entire Global Monetary system and it is very possible that we will go digital in the not so distant future.

Satoshi Nakamoto (pseudonym) developed Bitcoin (BTC) in early 2009. This decentralized digital currency was developed because of a lack of faith in the banking system.

Instead of using a bank, BTC uses a database called Blockchain. The Blockchain is a giant public ledger that stores all existing BTC (and other digital assets) and all transactions that have been made. It is a digital ledger where monetary transactions are recorded.

Where the current banking system uses debit and credit, blockchain has three elements: debit, credit and verification. This effectively removes the middlemen. The trust and security, are built in to the system and apparently, it is very hard to hack.

On the other hand, I feel the security side of things is a work in-progress as I have read stories over the last few years of crypto currencies and exchanges being hacked.

As bitcoin is yet another form of investing that I have crashed and burned, I put it to the back of my mind until the last few months.

What I have found with my relationship with money is that I am very emotional. And my experience with crypto currency is no different.

Since my 1st investment in crypto currencies in 2017, I am approximately £6000 down. This led me to bury my head in the sand again and just put it down to another loss. My dark cloud kicked in yet again.

What I have come to realize is that learning the fundamentals has been worthwhile. I am familiar with different exchanges (where you trade digital currency for other assets) and have practiced sending BTC to different addresses. The small amount of BTC I own has been transferred from my exchange account, to my Trezor wallet (secure vault for digital assets). I have even read Bitcoin for dummies…

I honestly feel that digital currencies are going to be the new standard. With the fallout from COVID-19, that may be sooner rather than later.

Although it is anyone’s guess as to how things are going to play out economically, we can at least try and protect ourselves by diversifying our assets.


GOLD (and other commodities) – Many experts recommend holding Gold and some suggest silver. I have neither. If I had the resources, and a big fuck off safe (buried in the garden) I would invest in silver.

PROPERTY – Bricks and mortar is a no-brainer in my opinion as houses will always be valuable regardless of the currency.

STOCKS AND SHARES FUND – I have a Vanguard fund that tracks the markets. It has an 80/20 (shares/bonds) ratio and is spread across assets in various parts of the world.

CASH – If you are a contractor (like me), it is recommended to have a few months worth of expenses in cash to cushion the blow of unemployment.

CRYPTO ASSETS – Last but certainly not least. I have lost money in Crypto currencies but I have still got an investment that I may make money on. Even if you only have a small amount to invest, I would invest in Crypto to get familiar with digital money.

Now BTC may come and go, but the prospect of digital money being the new standard is very real.

As well as diversification, I would also recommend reading up on digital currency and what many believe is the future when it comes to money.