This post provides a snapshot of my financial position as of 2025. I began documenting my financial journey in 2021, and every year since, I’ve written an annual letter to my future self—much like a CEO addressing shareholders. The previous letter was the Annual Letter 2024, and I’ll give you a spoiler: 2024 turned out to be a better year than 2025.

I hope this article adds value to your life, just as it does to my future self. My financial numbers and goals are personal and may not directly apply to you, but the underlying ideas are meant to be adapted. Please consider your own context—your country, financial position, and personality—when applying these insights.

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1st of January 2026

Dear Future, Me,

This year, our portfolio, measured in euros, returned a modest 3.74%. The result appears weaker when compared with the S&P 500, which, measured in U.S. dollars, rose by nearly 16.65%. There are several reasons for this underperformance—including the fact that it is entirely normal and acceptable—which I will address later.

The portfolio’s current value stands at €163.4 thousand, representing an increase of more than €24.0 thousand, or over 15%, compared with the previous year.

Looking ahead, we expect future returns to improve; however, this may not materialise given today’s relatively high market valuations.

Portfolio asset allocation

The majority of our investments remain allocated to individual stocks, an approach that has delivered good results over the past years. This year, however, returns were positive but broadly flat, and this trend may persist in the medium term. The reasons are straightforward: mistakes happen, and investing in stocks relies on acquiring businesses at prices below their real value, and such opportunities arise infrequently. When they do, we are confident that we will be ready to act.

Over the past year, our cash position increased to approximately 12% of the portfolio. This level provides resilience and flexibility, allowing us to respond effectively to future opportunities. The remainder of the portfolio is invested in ETFs.

The table below presents the portfolio allocation by asset class.

Assets	2025 (%)	2024 (%)
Individual Stocks	48.05	56.41
ETFs	34.69	35.38
Cash and equivalents	12.81	4.55
Equity and bond funds	4.32	3.50
Term deposits	0.13	0.16

Current year’s results

Our previous reports have shown a portfolio growth of around 3.74%, measured in IRR. The top asset performance in 2025 continues to come from investments in ETFs and individual stocks. The return from the second group decreased significantly. The reasons behind this lower return are quite simple:

1. On average, only a small subset of stocks delivers superior returns; statistically, the odds are against us.
2. There are periods of underperformance, even for stocks that outperform over the long term.
3. Mistakes matter—and yes, this year I made several, including an investment in InPost that directly cost us around 2.5%, excluding opportunity costs.
4. I will always choose capital protection over outperformance.

To conclude, I do not know whether this underperformance is temporary or permanent, but I do believe there is a reasonable chance of achieving a good result in the long term.

The next table presents the portfolio’s top-performing assets.

Assets	2025 (%)	2024 (%)
ETFs	8.11	25.55
Individual Stocks	1.51	39.53

The table below outlines the composition of the portfolio, excluding cash and term deposits.

Number Of Shares/Units	Assets	Type	Cost (€)	Market Value (€)	IRR (%)	Abs.Perf. (%) (1)
545	Jeronimo Martins	Individual Stock	8941.27	11041.70	6.67	8.32
15	Berkshire Hathaway	Individual Stock	3061.93	6416.81	16.97	109.57
342.6	Alves Ribeiro	PPR	6572.00	7085.14	3.23	6.81
386	Vanguard FTSE All-World UCITS ETF (Dist)	ETF	40485.87	54696.20	12.90	34.16
17	iShares Core MSCI World UCITS ETF USD (Acc)	ETF	1031.58	1896.01	12.97	83.80
168	Vidrala	Individual Stock	11452.54	15136.80	11.74	23.56
26	Meta Platforms, Inc.	Individual Stock	7523.97	14606.25	38.97	101.68
46	Spotify Technology S.A.	Individual Stock	5050.22	22734.18	59.83	350.05
880	Dino Polska S.A.	Individual Stock	7215.08	8620.71	10.35	19.43
			91334.46	142233.8

1. Absolute Performance = market value + sell/outbound deliveries + dividends – taxes – fees – initial valuation – buy/inbound deliveries. This calculation for absolute performance is limited to 2018 to the present.

The book value grew 13.80% in the last year, totaling €191 thousand.

Metric	2025 (€)	2024 (€)
Book value	191,035.05	164.675.63

Our book value has grown through three primary sources: savings from salary, portfolio returns, and the gradual increase in our equity in our flat through mortgage repayments. Historically, these sources have driven an average annual book value growth of 41.31%, although this year recorded the lowest growth rate to date. To sustain—or accelerate—this growth, we need to reinvent some of our existing sources and introduce new ones.

My near-term goal is to develop new sources of growth while rethinking the current ones. In 2025, we experimented with new initiatives such as freelancing and software development for a quarry. While the results have not yet fully materialised, they are expected to do so over time. As an early indication, approximately €1,000 of our book value growth this year can already be attributed to these efforts.

The following table presents the growth rate per year and calculates the average across all years combined.

Year	%
2018	41.10
2019	72.06
2020	35.09
2021	49.47
2022	19.48
2023	56.11
2024	41.18
2025	16.01
	41.31

This year, to facilitate the true understanding of our financial health, I drafted our balance sheet. Please check the table below it.

Line Item	€
ASSETS
Non-current assets
Investment in a jointly controlled asset (Flat – 50% ownership) (recorded at purchase price in 2018)	58,750.00
Right-of-use assets (IFRS 16)	0.00
Property, plant and equipment (IAS 16)	0.00
Financial assets – non-current	0.00
Other non-current assets	0.00
Total non-current assets	58,750.00
Current assets
Cash and cash equivalents
• Cash – savings account	20,984.76
• Term deposit (≤3 months, penalty-free)	213.03
Total cash and cash equivalents	21,197.79
Financial assets at FVTPL (Stocks + ETFs)	135,148.66
Financial assets at amortised cost (PPR)	7,085.14
Other current assets	0.00
Total current assets	163,431.59
TOTAL ASSETS	222,181.59
EQUITY AND LIABILITIES
Equity
Personal capital (Net worth)	191,035.05
Total equity	191,035.05
Non-current liabilities
Borrowings – real estate loan	28,230.54
Lease liabilities – non-current	0.00
Other non-current liabilities	0.00
Total non-current liabilities	28,230.54
Current liabilities
Lease liabilities – current	0.00
Borrowings – current portion	2,916.00
Other current liabilities	0.00
Total current liabilities	2,916.00
TOTAL LIABILITIES	31,146.54
TOTAL EQUITY AND LIABILITIES	222,181.59

Every decision I make always focuses on following our long-term core strategy, which is centered on increasing “look-through” earnings. These earnings are derived from two main sources: salary and investments. The annual letter 2021 provides further detail on the concept and rationale behind “look-through” earnings.

As we enter the next phase of our journey, we have slightly adjusted the “look-through” earnings methodology. In addition to the traditional sources, we now include a new earnings stream from projects. This source, which is reported above, contributed approximately €1,000 during the year.

The tables below present a draft version of my “look-through” earnings. The figures are approximate rather than precise and are intended solely to illustrate the direction and magnitude of changes in earnings. Some items (for example, Net Savings) may differ from those shown in the 2024 table.

Assets	Number of shares 2024	EPS 2024 (origin currency)	EPS 2024 (€) (1)(2)	Earnings (€)
Spotify Technology S.A.	46	€5.5	5.5	253
Jeronimo Martins	545	€0.95	0.95	517.75
Meta Platforms, Inc.	26	$23.86	20.29	527.54
Berkshire Hathaway, Inc.	15	$22.00	18.72	280.80
Vidrala S.A.	168	€8.429	€8.429	1416.07
Dino Polska S.A.	880	PLN 1.535	0.3638	320.14
Vanguard FTSE All-World UCITS ETF (Dist)	386	€6.24	6.24	2408.64
iShares Core MSCI World UCITS ETF USD (Acc)	17	€4.25	4.25	72.25
				5796.2

1. $1 equals to €0.851.
2. 1 PLN equals to €0.237.

	2025	2024	Delta (%)
Gross Earnings (€)	5796.2	5001.36	13.71
Tax (28%) (€)	(1622.94)	(1400.38)	13.71
Net Investment Earnings (€)	4173.26	3600.98	13.71
Net Savings (€)	19005.62	16446.30 (1)	13.47
“Look-Through” Earnings (€)	23178.88	20047.28 (1)	13.51

1. The values differ from those reported in the 2024 annual report, as some figures were incorrectly reported at that time and have since been corrected.

This year, “look-through” earnings increased by 13.51%. All earnings sources—investment returns and savings from salary and projects—contributed in a balanced manner.

Maintaining this rate of growth becomes more challenging each year, primarily because salary, the largest contributor, has been growing at a slower pace. Potential solutions include salary increases or the identification of new income sources.

Ultimately, success or failure will be measured by the ability—or inability—to materially increase earnings sources over time.

Portfolio outlook

Finally, this section provides a brief outlook on the portfolio’s future. Based on this year’s results, we remain on track to reach a portfolio value in excess of €700,000 by 2039.

While this goal is achievable, it may reflect a degree of limited ambition. It may therefore be prudent to set—and actively pursue—more demanding targets. Why not make 2026 the year to aim higher?

In the coming years, I remain committed to exceeding these goals.

This post captures my financial journey thus far. It continues the documentation initiated in 2021 through three earlier articles: Annual Letter 2021, Annual Letter 2022, and Annual Letter 2023.

I hope this article adds value to your life. While my financial numbers and goals may not directly apply to you, please adapt the insights to your reality. Consider factors such as your country, financial position, and personality.

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1st of January 2025

Dear Future, Me,

The S&P 500 index, measured in US dollars, saw impressive growth of nearly 24.01 percent. Thankfully, our portfolio matched this performance, achieving a return of 29.43 percent. However, it’s important to note that our performance may appear better than it is because our primary currency is the euro. The portfolio’s value currently stands at €138.9 thousand, an increase of more than €46.0 thousand compared to the previous year. Looking ahead, we expect the portfolio’s future returns to be low due to relatively high valuations.

This letter will cover three main aspects: the asset allocation within the portfolio, the results from the current year, and the outlook for the portfolio moving forward.

Portfolio asset allocation

In 2024, we allocated the majority of our investments to individual stocks. As a result, our cash position currently stands at 4.55%. However, we expect this percentage to decrease to around 2.55% as we continue with an ongoing investment that will be finalized in a couple of days. I will provide more details about this investment in a future letter.

Increasing our liquidity will strengthen the portfolio’s resilience in the coming year and ensure we have sufficient resources to capitalize on future opportunities. While our strategy focuses on investments in ETFs, we have discovered more potential in individual stocks. Only time will tell whether this was a good decision.

The table below shows the portfolio allocation by asset.

Assets	2024 (%)	2023 (%)
ETFs	35.38	38.86
Individual Stocks	56.41	46.33
Equity and bond funds	3.50	9.97
Cash and equivalents	4.55	4.69
Term deposits	0.16	0.00
Personal bond (NMC bond)	0	0.16

Current year’s results

The book value has increased by 44.93 percent, totaling €164.7 thousand. This book value consists of a portfolio of financial assets and a 50 percent ownership share in my flat. I have a debt of €33.0 thousand associated with the purchase of the flat. As previously mentioned, the value of the portfolio is €138.9 thousand, with the remaining amount attributed to the value of the flat.

The table below outlines the composition of book value.

Metric	Value (€)
Total Assets	197677.64
Total Liabilities	33002.02
Book Value	164675.63

Since 2018, the book value has been growing at an average rate of 44.93 percent per year. This growth has mainly been driven by salary increases, interest, dividends, and asset appreciation. However, such a high growth rate is not sustainable. To maintain or enhance this growth rate, we need to rethink our strategy.

Next year the expected salary savings are projected to contribute approximately 10 percent to the book value. Meanwhile, interest, dividends, and asset appreciation may experience a decline due to relatively high valuations. Even if they contribute positively, we do not expect this impact to exceed 10 percent.

This leads us to reconsider the following question: What will be the sources of additional income/profit in the coming years?

This question concerns an ongoing issue clouded by two unusual outlier investments: Meta Platforms and Spotify. While I expect both companies to yield positive returns in the future, I do not anticipate them growing at the same rate. I want to express my gratitude to these companies for being the driving forces behind our portfolio growth. However, it is now my responsibility to identify new growth engines.

The table below outlines the composition of portfoleo.

Number Of Shares/Units	Holding Period (days) (1)	Assets	Cost (€)	Market Value (€)	IRR (%)	Abs.Perf. (%) (2)
545	164	Jeronimo Martins	8941.27	10055.25	3.24	1.66
15	1425	Berkshire Hathaway	3061.93	6544.61	22.47	113.74
245.8	294	Alves Ribeiro	4572.00	4868.89	3.06	6.20
357	720	Vanguard FTSE All-World UCITS ETF (Dist)	36757.63	47388.18	14.92	27.87
17	1458	iShares Core MSCI World UCITS ETF USD (Acc)	1031.58	1770.72	14.49	71.65
126	744	Vidrala (3)	9526.90	11705.40	9.92	14.90
26	937	Meta Platforms, Inc. (4)	7523.97	14653.25	58.12	101.75
46	807	Spotify Technology S.A.	5050.22	19808.91	85.24	292.13
88	287	Dino Polska S.A.	7215.08	8023.95	14.05	11.16
459	79	Inpost S.A.	7885.54	7478.09	(16.60)	(3.90)
			91566.12	132297.25

1. Holding period from the date the first share was bought.
2. Absolute Performance = market value + sell/outbound deliveries + dividends – taxes – fees – initial valuation – buy/inbound deliveries. This calculation for absolute performance is limited to 2018 to the present.
3. 14 out of 126 Vidrala shares were issued as bonus shares at no cost, but they are accounted for as an expense, negatively impacting performance.
4. This year, the sale of Meta shares resulted in realized gains of approximately €2,910.48 which is not contemplated in the table.

The strategy’s core consists of increasing the “look-through” earnings. The earnings sources are salary and investments. The annual letter 2021 contains more details about the “look-through” earnings concept.

The tables below present a draft of my “look-through” earnings. These values are approximations, not precise, and are only used to provide a sense of increase or decrease in the earnings.

Assets	Number of shares 2024	EPS 2023 (origin currency)	EPS 2023 (€) (1)(2)	Earnings (€)
Spotify Technology S.A.	46	-$2.73	-2.457	-113.02
Jeronimo Martins	545	€1.2	1.2	654
Meta Platforms, Inc.	26	$14.87	13.383	347.96
Berkshire Hathaway, Inc.	15	$10.06	9.054	135.81
Vidrala S.A.	126	€6.89	€6.89	868.14
Dino Polska S.A.	88	PLN 14.33	3.1526	277.43
Vanguard FTSE All-World UCITS ETF (Dist)	357	€7.31	7.31	2609.67
iShares Core MSCI World UCITS ETF USD (Acc)	17	€5.30	5.30	90.10
Inpost S.A.	459	PLN 1.3	0.286	131.27
				5001.36

1. $1 equals to €0.90.
2. 1 PLN equals to €0.22.

	2024	2023	Delta (%)
Gross Earnings (€)	5001.36	4109.15	21.72
Tax (28%) (€)	(1400.38)	(1150.56)	21.72
Net Earnings (€)	3600.98	2958.59	21.72
Net salary savings (€)	14000	14000	0
“Look-Through” Earnings (€)	17600.98	16958.59	3.79

This year, “look-through” earnings grew by 3.79 percent, driven by net earnings of 21.72 percent. However, the growth in earnings has slowed compared to 2023, when the increase was 10.48 percent. The challenge for the next couple of years will be finding ways to significantly increase “look-through” earnings. Potential solutions might include salary increases or identifying new sources of income.

Success or failure will be measured by the ability or inability to significantly increase earnings.

Portfolio outlook

Finally, this section presents a brief outlook on the portfolio’s future. This year’s results keep us on track to reach a portfolio value exceeding 700,000 euros by 2039.

While this goal is achievable, it might be wise to set higher targets. Doing so could increase the likelihood of reaching the initial goal sooner, while also opening up new horizons and opportunities for further achievements.

In the coming years, I am committed to exceeding these goals.