Portfolio Update & Pension Plan Tips — Full Transcript & Summary

[00:04] four of my investment portfolio that I am taking to 1 million euros. my YouTube channel because that's what I do, teach people how to invest. You can copy me if you want, but this is not an

[00:19] curiosity or to get ideas from both this video and the entire "Road to a Million" series. Let's start by updating the portfolio, how it's been going. I have my show you now, and I also have an Excel spreadsheet that you don't have to make, but I

[00:31] like to keep track of it because I'm a bit of a geek. And this month there's a new development: there's an investment that I will be making outside of Trade Republic. cash section where I keep my

[00:44] anything, [music] I can withdraw it at any time and it won't go down in value. €100,000 insured, it's a bank and I also have the interest-bearing account which currently pays 2% and I have the portfolio section which are

[00:57] the investments themselves. I have a crypto wallet section where I only have a little bit of Bitcoin, although it's doing very well, with an 8% return, and then I have what are securities accounts, index funds, which are these down here

[01:11] . I have four equity portfolios: S&P 500, Europe, emerging markets, and Japan. Then I have fixed income, which I do n't really need since I'm investing for the long term, so it's But I'm showing the fixed income portfolio in case someone wants to incorporate it into their

[01:25] portfolio. For example, if they're 60 years old and don't want to invest for 30 years, then a little more fixed income would be a good option. And I also have some gold as a complement, which I do n't have in an index fund because there isn't one at Tade Republic, but I do have

[01:38] a gold ETF. And as you can see, almost everything is positive. Look at the equity index funds, except for the fixed income one, curiously, I also have gold in negative value and Bitcoin is in positive value, which is the same as we can

[01:53] Excel but from Google, where I have everything summarized, because I like to see it a little better. Now we are going to assess this profitability that we have achieved. I'm saying this for all of you who are also copying my portfolio,

[02:06] investment advice. I have to say it. As you know, everyone should do their own research and adapt it to their own goals, but so far we have achieved a solid 3% in the 4 months we have been doing this . In fact, a little more,

[02:21] 3.6%. Therefore, 3.6 / 4 months per 12 months per year. This is currently giving me a 10% annual return, which is more 10% annual return, which is more or less in line with what I'm going to look at in facti,

[02:37] in this because I include gold and emerging markets. But to get an idea, not just by looking at my portfolio, which has only been in place for 4 months, and we can't draw conclusions in just 4 months when we're talking about 20 years, but here we do see the results.

[02:52] The index performance since 1987, the annualized return ADA is 8%, and I'm currently getting 10%. But again, it's only 4 months; we can't draw conclusions. That's why the golden rule is that, hey, markets go up and

[03:08] down, especially if we're so exposed to equities. The correct strategy is to do nothing and maintain the course; if in a year we turn out to be losing money, which could very well be, well, that's okay, be

[03:21] patient, because profitability comes in the long term with our contributions the years; that was the famous compound interest and the snowball effect. rebalancing, because I'm getting asked about it a lot in the

[03:36] beginners or those who are already starting to invest in this. They ask me when to rebalance and how to do it. And the answer is that it doesn't have to be done very often; it's usually done once a year.

[03:50] often; it's usually done once a year. And basically for two reasons. If your position changes, your objectives change, for example, if not a year has passed, but 5 or 10 years and you no longer want 90% equities and 10% fixed income, but you want, for

[04:04] example, 80% equities and 20% fixed income, then you have to rebalance. And thanks to the fact that our portfolio is made up of index funds and not ETFs or individual stocks, one advantage we have in Spain with

[04:18] index funds is that we can make transfers without selling them, because if you had an ETF you have to sell it to buy the other, then the tax authorities come into play, you've made taxes, which breaks the compound interest effect and that's not

[04:32] good for us in the long run. It's great that we have index funds. rebalancing, because you want to change your percentage of equities and fixed income. The other reason is that you want to maintain the current percentages, but a year has passed

[04:46] and it turns out that one part of your portfolio has risen much more than another. One has risen a lot, another is even in the red, so you may no longer have the 9010 you wanted, but you still want a 9010

[05:00] fixed variable percentage, therefore you have to rebalance to get back to 90. For example, it turns out that my US index fund has risen a lot, 8%, and I've even lost money. Currently I haven't lost money because you don't

[05:14] lose until you sell, but fixed income is in negative territory. If it gets unbalanced now, imagine, I'm exaggerating the numbers and going to 95 variable and CCO fixed and I want 90 10, what I can do is a transfer of index funds

[05:29] from this United States to the fixed income one or from the United States to another, for example, the one in Japan or the one in emerging markets has also gone up a lot, so I can rebalance it and put it in the one in Europe. That's how it would be done. But don't

[05:42] stress too much about rebalancing. It's not something you do every month, unless you isn't the point of constantly changing it either. You long-term project. Furthermore, you can simplify things and have the typical MSC

[05:56] World package that includes everything except emerging countries, which you have to add, and you can add cryptocurrencies or gold. Or you can separate it, as I do, into different index funds in four different ones: the United States,

[06:08] Europe, Japan, and emerging markets. This gives you the flexibility I mentioned, not just now, but also many years from now, for example, 20 or 30 years from now, when we want to start withdrawing from our investments. Because that's why we

[06:20] invest in the first place—to make money—then we can have the flexibility to withdraw first what has risen the least to pay less tax, and later we'll sell what has risen the most. That flexibility

[06:34] is the advantage of having it a little separate. Okay, and this month I have some news: I'm going to add a pension plan to my portfolio. A pension plan, I've also written it or I said PP for pension plan. It is a

[06:48] long-term savings vehicle with a unique tax advantage. Each euro contributed directly reduces your taxable income in your income tax return by up to €15,500 per year. And it is that in the past our parents or grandparents, depending on your

[07:01] age, were told about these pension plans that had the tax advantage I just mentioned. The problem is that these pension plans were very poorly managed because they were run by traditional banks like

[07:13] Casha, BBVA, and Santander, where the returns were mediocre because they invested in products that were n't very diversified, perhaps because of the

[07:27] was roughly 3% per year, and on top of that, these banks charged exorbitant commissions of 1.5%, 2%, or even more per year, leaving you with an annual return of only 1%. This made it

[07:43] not worthwhile because you could invest that money in something more diversified that would give you 7 or 8% annually. That was in the past, but now we have that I discuss on my channel, and now I'll show you examples where there are

[07:58] pension plans in good products such as diversified ones, like index funds, like a pension plan linked to an SP500 or an MSC World or even an MSCI Acui. Now I'll teach you. Those returns, as I have shown you in

[08:12] a fact of the World Index, of the MSC World, are 89% good returns, and if these fully regulated investment platforms , which are not traditional banks, charge you 0.5% per year

[08:28] for these products and for all their investment products, instead of 2%, then it is worthwhile just for the profitability alone. And also, obviously, we still have the tax advantage that we can reduce our

[08:41] tax advantage that we can reduce our income tax base by up to €1500 per year. Oh, and another important thing is that pension plans used to not let you withdraw them until you retired. Now, however, they do let you

[08:53] rescue them, but only after 10 years have passed. Therefore, it's already much better. And here's a practical example: if you contribute €1,500 a year to a pension plan, which would be €125 a month and is what I'm going to do, and you

[09:07] although there are many details depending on where you live or we already know that it's progressive, but a quick example of if you pay roughly 30%, that means you save €450 a year on your tax return. That's the great

[09:22] advantage of pension plans, and that's why I'm going to add them. And as you already know from my other videos, and I'll explain it again now, I invest €1,000 a month in fixed income and equities, as stated here. I don't put more in

[09:36] emergency fund, which in my case I decided is €6,000, when I have that, all the rest goes to fixed income and equities. Specifically, you can see the weights here, and here is the update for this month of May,

[09:50] well, it will be just as June begins, where you can see that the weights for fixed income until now were only 5% and 95% for variable income. I've changed it a bit now because I'm adding my pension plan, and I wanted to say that these are the

[10:03] percentages, the weights in each of the different index funds, because the world, but it's true that it has a lot of weight, therefore, it's what I invest in the most and it's usually done this way. If you invested in a Rob Advisor or yourself

[10:17] in an MSC World, MSC Aquid, it would also be distributed more or less like that, with more weight in the United States, blah blah blah. Therefore, my contributions will now be Therefore, my contributions will now be divided as follows. €875

[10:30] to my portfolio of funds, which are the ones I have in T Republic, and another €125 in a in T Republic. Therefore, I use another platform that is widely used in Spain, which we will talk about now. Turning to pension plans, we'll see

[10:45] what the best options are for investing in them from Spain. You know that traditional banks are totally out of the question, although it would still be better to invest in one of those banks than to do absolutely nothing about

[10:59] watching this video, let's do it better, shall we? A very good option is Finicence, which I've already mentioned on my channel. It's a robo-advisor and they also have pension plans where you can see that the fees are 0.55%.

[11:14] global diversification so you're not bank product that gives poor returns, but rather around 7-8-9% annually. We have exactly the same thing at Indexa Capital because it's a Rob Advisor, just like

[11:28] Finicens, where the commissions are also 0.52% and lower. I mean that on these platforms, the more you invest or the longer you've been invested, the more discounts you get on commissions,

[11:40] but that's the highest possible, and it includes all management fees, custody fees, etc. And a third option, which is actually the one I like the most at the moment, is Mag Investor, where they also have

[11:52] some indexed portfolios. You can choose which ETFs or index funds to invest in, and they also have PPs, pension plans; for example, they have one indexed to the SP500 as I mentioned, but that's only in the United States. I

[12:06] want to make it more global, so they have this option, My Investor Global Indexed PP, which if you click on "subscribe" or " learn more" opens this tab where, look, the investment objective is to replicate the evolution of the MSCI

[12:21] AQui index, which is All Countries World, which is like the MSC World, which is 13 companies from 23 developed countries, but here the emerging countries would be missing to

[12:33] encompass the world economy. each with its own weight and the MSCI here is the same as the W, but including emerging countries. So with this we would have perfect for a pension plan. Note that the minimum investment is

[12:48] €10 and the total commissions are 0.38%. So that's great. And we can see the profitability it's been generating lately. For example, so far in 2026, it's 9.8%.

[13:02] Profitability from just one year is not enough for us . Therefore, in a year, going back, not only to 2026, but year-on-year, up to 12 months, it has 23% in the last 12 months. Over the last 3 years, 17% annualized return, that is, per

[13:18] year. And in the last 5 years it's starting to get a little closer to an idea of ​​what we can have, although it's not really useful to us because we're going to explain what I'm doing in my case , annualized at 11%, you see? It's getting

[13:32] better now. To be a bit more conservative, or so to speak , I would say that we're going to get 6-7-8% annually. That would be like some good in this, it's very easy, you create an account, which by the way I have the typical friend code

[13:47] where we both get €25, I'll leave it in the video description and you click to make a contribution if it's something one-off or in my case, I schedule a contribution that I already have made, which is €125 per month. Because?

[14:01] Because 125 * 12 is 15,500, which is the maximum amount they allow you to reduce your maximum amount they allow you to reduce your income tax base by. 1500. Beyond that, it's not let you do that, like lowering your base to 100,500. For example, here

[14:16] investing in until now that I'm starting this, I click on manage contributions and you can see that I have this automated operation where I automated operation where I periodically contribute €125 each month

[14:28] starting on June 2nd, which right now when I'm recording this video is just a few days away. And at the same time, I, who use Revolute as my main bank, have a transfer scheduled. Until now it was

[14:41] €1,000 to my T Republic account. I have now changed it to €875 to my Republic account so that the investment is spread out, and a new automatic transfer of €125 at the end of the month. I think I have it set for the 27th of the month so that it has

[14:58] time to arrive, and then on the 2nd it will automatically reverse, just like in Republic, and that's it. A really good investment tip I've discovered, people, is to set up an automatic transfer. A lot of

[15:13] start investing €100 a month, great, but then something happens this month, I've had a stroke of luck, I have to take a trip if I have the money in my account, I'll see it and spend it." So the best thing you can do

[15:27] is set up an automatic transfer, and then you'll manage with what's left. How much will you manage? Obviously, don't go overboard with a huge amount that you can't invest every month, but you can start small, with €50 or €100

[15:39] a month. And I've prepared a very basic diagram here to summarize how this tax advantage of pension plans works. You contribute €1,500 a amount; that's like the maximum you can deduct from your income tax. You can contribute

[15:54] €10 a month. You've seen that the minimum It was €10. That's €120 a year, okay? You reduce your tax base. In my case, since I'm going to contribute the maximum, €125 a month, € 10,000 a year, it's reduced in your income tax. For example, if someone has an income

[16:09] of €30,000—I know this depends on other things, exactly what you're doing, where you live, what other investments or income you have—but to summarize, that's roughly €450 less you pay in taxes.

[16:23] And what you don't pay in taxes, you can, so to speak, reinvest in compound interest. One important thing I have n't mentioned yet is that a pension plan is one of the few instruments where the tax authorities help you invest, but

[16:37] when you redeem it in 10 years, for example, or 20, whatever, and you start withdrawing from your pension plan, then it will be added to your personal income tax. So, it's not so much a direct advantage, but rather a flexibility. I

[16:51] postpone taxes for the future, which is where compound interest comes in. wondering, you include this in your tax return, in box 474 for contributions to social security systems. And I'll take this opportunity to

[17:04] mention something interesting: you know that in Spain, personal income tax (IRPF) has a general base and a savings base. Generally speaking, investment that generates income usually goes into the savings base, while any income from

[17:18] your economic activity— exchanging time for money, your work— goes into the general base. There are always a few exceptions, and an investment, it doesn't go into savings but into the general base. And

[17:34] when I say "goes into," I mean that you can reduce your for those of you giving away for free if you subscribe to my newsletter (which is also

[17:47] And then I also send some emails about things that I can't all explain in this video. I created a tracking Excel spreadsheet because I'm a bit of a geek; I like looking at it, I want to keep

[18:01] more detailed track, and I think it will be quite useful in the future. my T Republic account shows me. Plus, if I add things like a pension plan on another platform, I can see it all in one place.

[18:15] And super important, I want to emphasize that you don't need to use an Excel spreadsheet. In fact, I wouldn't want you to stop investing because you're overwhelmed by the idea of ​​using an Excel spreadsheet or something like that. It's not necessary at all.

[18:29] Now I'll show you the one I'm using because I'm a bit of a geek, and for those of you sometimes ask me how I set this up exactly, for example, I also record my changes here. I mean, I started month one

[18:43] in February, and it looked like this. In month two, I changed it... This, right? What's in yellow, for example, the weights, and I added gold, which I didn't have before. Now, in month three, I didn't make any changes, I mean, and in month four, I'm adding the

[18:56] pension plan, which means I have to recalculate or adjust the weights slightly to want to invest more at the moment, so in my portfolio—you already know from other videos, I don't want to bore you with that—but I can make

[19:10] a new recurring contribution. In this case, it will be on June 2nd, and everything will be done automatically. If you want to add something new, for example, and now I want to add the pension plan, what you can do is, I'm going to copy this, I'm

[19:23] going to put it here because it's equity, and here I'll put pension plan. What's the name of this product? Well, look, I'm going to put this: My Investor Indexed Global PP. I paste it here, I format it the same way so it looks

[19:37] nice. And in this case, it's not this. Instead, I'm going to put, look, this number, which is actually like an identifier so that the Tax Office or regulatory bodies know that it is indeed a pension plan and that you

[19:50] can actually deduct it, right? When I say deduct, I sometimes speak generally, you know, reducing the income tax base. I copied this from before, so it's not valid, but I would put, well, €125 that I will contribute, you know, in the

[20:03] new contribution on June 2nd. In my case, I'll see the number of shares , but if I'm contributing €125 and each of these is worth €19, then it 's more or less what I calculated before; I'm not that good at doing

[20:18] before; I'm not that good at doing such precise mental calculations, it's about 6.55 shares, so the initial value will be €125. , you'll have to adjust these things, like the total value will be, well, right

[20:32] when it starts it will be €125. Likewise, there it is, 0%. Also, in my calculations, the total investment in this case will be up to this cell from A to D. There it is. And also the total value up to D. Okay, I'll include everything like that. There

[20:50] . I've included it now. I can update all of this later. Speaking of the charts, as you know from my other videos, I've set it up this way; here I can see the total value and the contributions, which is really nice to

[21:03] see. At the beginning, obviously, your entire portfolio will be mainly due to your contributions because, well, we've only been at this for 4 months and we're investing for the long term. Later, it will be the other way around; the growth of the portfolio itself will be much greater than

[21:15] your contributions, and that's the beauty of long-term investing with compound interest. And one small detail— I hope I don't bore you with this—it's for those who follow the Excel spreadsheet, and I explain that this chart is a snapshot of how the

[21:29] investments, my investments, are at the moment I make a new contribution. That's what it calculates. If I want to see how my portfolio is doing after 2 In the weeks between I can do—and I explain this in other videos, I won't do it now to bore you—

[21:43] is put the total value of my fixed income here . So, I'll check in my TePublic app that the fixed income is currently worth this much. Then I'll put that number here. I do the same for all the financial products I have, and that's how I

[21:55] get this total value, the total investment. I can see this other snapshot whenever I want, which, when I entered it, is currently 3.6%, so that 's €477 in profit. Obviously, I'm not going to touch it; I'm not

[22:09] going to withdraw any earnings. This is for the long term. Speaking of beginning all the money in my portfolio is from contributions, but then it reverses, let's do some calculations because it's very useful to have

[22:22] that view of the future and also to motivate ourselves. Imagine you start with, I don't know, €1000 and you contribute € 200 each month. Let's assume an 200 each month. Let's assume an annual interest rate, the annual return of 8%

[22:35] for 30 years. I run the calculator, and notice how in the first few years the blue bars represent the predominant part, which is my regular deposits. Initially, all your capital will be this blue block. But then, as the years go by—

[22:50] in this example, from, I don't know, year 15 onwards—you can see how the green bars represent the largest part of my total portfolio, which is precisely the total interest, what has been generated, and the sum of both is what I have

[23:04] in my portfolio. And notice how at the beginning it doesn't change much. For example, beginning it doesn't change much. For example, from year 6 to year 7, we go from 4,700 to 6,500. That's a difference of about 10,000 or so, which isn't that much, but

[23:18] 10,000 or so, which isn't that much, but look at year 27, where we have a total portfolio of €172,000, and the following year at €192,000. That's a difference of €20,000 that you earn in one year. This is where it starts to get really

[23:35] interesting. And obviously, the longer you leave it, the bigger it will get—for example, at 40 years old. But it's true, and practically speaking, that very few people start investing at 20, and

[23:48] a 40-year horizon is probably too far off for you. So lower it to whatever you want, for So lower it to whatever you want, for example, 25, where a lot of the weight we can control also comes into play, because you can't control the annual interest rate—let's say around an average of

[24:00] because you can't control the annual interest rate—let's say around an average of you invest. Maybe right now, given your financial situation, €200 is fine, but if later on your situation improves and you can—by improving I mean having

[24:13] more income and being able to invest more—well, see how things change. If you go on to invest €500 a month, you'll reach the same result as before, even more, and in fewer years. Or me, for example, who started, if you look at the first video, with

[24:26] started, if you look at the first video, with €10,000 and contribute €1,000 each month, I'm €10,000 and contribute €1,000 each month, I'm also going to assume this 8%... 25 years, if I calculate it that way I'll reach a million. What's this series about? The road to a million.

[24:38] So I'm planning it more or less with a 25-year horizon, although I'm not ruling anything out. In fact, I'll probably push towards that idea that when another, I don't know, 5 years have passed, I understand, I'm going to try to make

[24:52] things better and instead of €1,000, maybe I can invest €100 or €2,000. We'll see. And if also possible, especially in the world of entrepreneurship since I'm a YouTuber, I might lower the amount. Not getting overwhelmed by it means at least being at ease knowing

[25:07] that you already have a plan for the future, that you 're already investing. You're going to improve in the long run, no matter what. The question is exactly how much. And if you want me to help you with your investment plans, I have a community where we do

[25:20] group video calls, and we also have a community section where you can see how people who are in the same boat as you, or a little further along, are doing it. We all description. Leave any questions you have in the comments, and I'll see you in

[25:33] any questions you have in the comments, and I'll see you in the next video. Thank you so much.