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Archive for May, 2021

Giving my dollars a job

May 26th, 2021 at 06:00 pm

It's taken about 3 months of DH's new salary for us to find our budget. I think I have it ironed out mostly.  This year we will projecting a refund of $10,158 because of an overpayment of social security and just overpayment.  I don't know how to adjust it because DH has a strange payroll. They do not do a w2 they do a deductions and number of people in the family.  Next year our refund should be $2200 but I'll do quarterly estimates throughout the year.  This year we just got back our refund of $7716 which I put into savings hoping to hit $16k by January 2022 to contribute to 2 Roth IRA ($6k each) and 2 Coverdell ESA ($2k each).

That being said I think we have a pretty accurate budget and here is how it is going.  DH is paid biweekly so we get 2 extra paychecks a year.  We do have medical, vision, and dental, but no 401k or retirement savings.  Because of the biweekly nature I am budgeting on 2 paychecks a month and planning on saving 2 extra paychecks which is what happened.  DH makes $5457/paycheck after taxes.  Total monthly income is $10,914 net.  We currently pay $3839/month mortgage, $10706/year property taxes ($411/pay period), $909.70 home insurance/year, $270/year umbrella insurance, and $1988/year auto insurance.  I budget $1000/month (2 biweekly paychecks) for property taxes and umbrella insurance.  Auto insurance is budgeted from sink funds.  

$10914 Income
-$3839 Mortgage
-$1000 Property taxes/insurance
-$800 Sink Funds
-$3600 Spending - transfer to other checking for paying CC
-$1675 Savings - but trying to do $2000/month savings because we should be saving.

Technically we should be savings $2400/month which would be closer to the 20% we need to save of our income with the 2 extra paychecks a year.  So we should actually be living on $2800/month and $800 sink and $2500/month savings.

Again like I pointed out the problem is our mortgage.  We are at 44% of our net income monthly on our house.  The refinance will bring us down to 38%/month and will basically make it so that we can save 20% of our salary for the next 7 years until we have to pay the piper.  So we are pretty much having a handle on our "budget".  Doing better than expected.  

Also we probably need to budget the $3600/month more.  I'm learning about that as well.  Here is the budget.

Auto $1988
Life DH $1098
Life LAL $243
LTCI $720 (new not yet started)
Kids Math $6000
Amazon $120
Costco $120
=$9596 / 12 = $796 ($800/month)

Budget $3600
Electric $200 (balanced billing)
Water $150
Internet $60
Cell Phones $90 (3 lines, 2 tablets)
Spotify $11
Sirius $6
Dog $500 (this varies wildly)
Cleaner $300
Yard $300
= $1983 for groceries, eating out, clothes, gas, and everything else including travel, etc.

So that's probably why my $ don't have a job.  We are still figuring out how to budget the rest of the $2k/month spending. I've found I'm able to cashflow the kids camps, travel, groceries, eating out.  Becoming conscious has made me aware of what I'm spending on cooking, eating out and just in general spending.  In february we started $1056 on groceries and $45 on eating out.  March we spent $820 on groceries and $112 on eating out.  In april we spent $589 on groceries and $212 on eating out, and in May thus far we've spent $431 on groceries and $184 on eating out.  So we've been able to go traveling and pay for 4 weeks of kids camps and airfare for the summer but it's about to get to the point where we might have to touch the sink funds.   If we can keep our spending down in the next month it should smooth everything over.

But i can see how not having my $ have a job hurts but at the same time I feel like I'm also only slowly curating a budget.  I'm still tracking spending and watching as well spend and capping it, rather than naming it and letting it evolve. 

Hard to use my sink funds

May 25th, 2021 at 06:09 pm

I am struggling with letting myself us my sink funds. I find it easy to save and live but then I find myself naturally cutting corners and living simply and then mostly able to manage without touching our sink funds.  But then like this month we have a lot of things I accounted for in the sink funds like kid's camps.  I charged $1500 in summer camps.  Why am I hesistaning to use the sink funds?  That is what it's planned for? I budgeted $800/month into sink funds and we have $4400 in there so we are on target.  Isn't that what it's for? Monthly expenses paid 1x a year that we know are coming.  Like summer camp or travel or extracurricular.  Much like saving for property taxes.

I am having trouble not maxing out the property taxes.  I know I should do what I planned like $500 a pay period.  But instead we have $5100 in there already for October 31st, 2021.  Plus that is almost enough to cover the car insurance and home insurance due in August which is also part of the budget annually.  So why I am being so paranoid?  I don't know.  I don't have an answer why I feel this need to put the "escrow" fund to be fully funded before sink or retirement.  I guess it makes me feel better to know that we aren't worried about it.  That sure we have June, July, Aug, Sept, and October, to save for the other things.  But then we have to get into the routine of saving for our property taxes and insurances.

Then there is our $7800 tax refund.  What do I do with it?  I was going to stash it into savings but should I use it for funding sink funds?  And then call it? I also have a high credit card stash I'm not sure I can pay because of our all our "sink" fund charges do I use it to pay it?  

I am back where I used to be 5 years ago.  Having a hard time spending money again.  When you worry about a budget even if it's a generous budget I can't help but feel a little constrained.  Worried that I am not saving enough. Worried that I should be doing more.  I can see how being mustachian can become an addiction.

How do you find the balance of saving and spending?

2020 Taxes a calculation error.

May 20th, 2021 at 05:07 pm

I made a slight error in our 2020 taxes and forgot a few things.  So I'm getting a refund of ~$7k.  That is unusual for us.  Usually we try to owe the government money. I would have preferred the money in our pocked but it is what it is.  Also this year 2021 I know we will get a huge refund more like $10k plus.  I don't know how to fix it either.  DH worked two jobs and with the startup they are just automatically take out the SS so we'll have over paid SS alone $8500.  Then a couple of other things and I think we'll be around $11k overage.  Also since he works for the startup and it's a weird no w4 form but they ask you number of people, deductions, and we qualify for the $3k child tax credit finally, that I am pretty certain that we will hit $10k.  Actually I think that we will be at $13k-$14k.  By my estimate from our withholdings we will be over around $6k but including the overage paid on SS more like $14k.  Since it's a startup using a seperate payroll company and a CEO who doesn't care and wants it simple as possible, we just have to roll with it.

It might even happen next year as well, but we won't have the overage SS at least.  That being said since I know it's being withheld and I'm planning on saving my $7k into our "sink" funds, I was thinking maybe I'll just earmark our overage taxes as savings.

How do you guys adjust what you owe or get back?  Do you normally owe? Or do you normally get a refund?  I like to be within $1000 of oweing.

Interesting spending pattern on groceries and things

May 13th, 2021 at 08:56 pm

So I started tracking some stuff in February with our new budget.  I found that in Feburary we spent $1056.29 on groceries and $45.56 eating out.  The kids were at home and DH was at home. Then in March DH transitioned to going into work and the kids went to school 2 days a week each opposite days of course.  They were all eating lunch at work and school for free.  We spent $820.79 on groceries and $112.72 on eating out.  Then in April the kids were off and eating at home but DH was at work but near the end of April they started going 4 days a week and getting a free lunch.  So now we're down to dinners only for everyone and lunches for and kids 1-2x a week.  So we spent $589.09 on groceries and $212.27 eating out (1 meal was $93 for a brunch outside on patio).  

But now may thus far?  We've spent $154.36 on groceries (all fruits, veggies, and milk) and $105.38 on eating out with $73.16 on 1 meal of burgers with DH's cousin.  So we've spent a lot on eating out.  And I still have a lot of food in the freezer.  For instance this week I made ratatouille which we had for Tuesday and Wednesday nights of dinner (with all my eggplant, bell peppers, zucchini, squash).  I've been eating leftovers for the weekday lunches as I type this.  My kiddos have school lunches.  Eating out I spent $11 on a baker's dozen bagels on Tuesday from panera.  That's been breakfast and into a lunch sandwich yesterday (wednesday they are home).  Plan is $10 pizza from dominos tonight and I have still a bunch of chicken, ground beef, potatoes, etcs to cook.  This weekend we will spend probably $100 on meat and groceries because we're hosting couple of friends for BBQ and making ribs.  I'm debating buying sashimi this weekend as well.  But it's half the month and I know we aren't hitting $1000 on groceries.  $500 seems like a reasonable number.  

That would put our average at

$1056+820+$589+$500 = $741/month on groceries

$45.45+ 112.72+212.27+ 200 = $142/month on eating out.  Sounds about right.

I wonder if I can lower our average on both?  My mom is visiting memorial day weekend. I'm sure we'll get takeout and stuff.  And I'm planning on making her steak and lobster probably so maybe our grocery bill will be pretty high.  

I spent $704 and $620 on summer camps last month.  I believe I might be able to cash flow it without touching the $4400 sink funds set aside.  I'm finding it a challenge to live on what we "budget" and save the sink funds and not use it for what it's been earmarked for.  If we do that we'd be saving 20% of our salary.  Guess it's worth trying.   When the refi goes through I plan on saving that $700 and investing it.  It will make our life a little easier.  But at the same time with inflation coming I find it hard to justify moving to an arm. The only palatable thing is that it caps at 7% over the lifetime of the loan, it'll be 7 years, and we will be a much lower amount owed and we could refinance to a conventional mortgage at that time.

Headache with consolidating funds

May 12th, 2021 at 08:19 pm

OMG I can't stand it. I am trying to refinance with Chase. I have to move money over to get the best rate. I also wanted to consolidate our accounts.  BUT turns out I can't move money around easily.  Why?  Because when I moved money last year to Merrill Lynch they got my name wrong.  I did not input it wrong so they obviously opened accounts not in the right name.  Sigh.  Can't move money electronically.  I am leaving Merrill Lynch because they have no branches.  I tried to deposit a 401k Rollover check and couldn't drop it at Bank of America.  I'm not sure why the hell there is no one working. I guess because of covid apparently people don't work in office.  Great.  No.

Why the hell have all these requirement to open accounts in office if you don't have bodies in office?  Why bother having branches?  I guess I'm frustrated with how difficult this all is.

Reallocating my portfolio

May 12th, 2021 at 05:57 pm

I made a substantial move and sold half of DH's VNQ (vanguard real estate REIT) we were holding in his Roth IRA.  I did this because I have been thinking about it buying WPC another real estate stock. I wanted to move back from $100k to $50k into each stock.   I wanted RE but I wanted a little more balance of commercial loans and overall RE.   I still would like to buy a rental but not right now.  We have too much going on.

Well the market is dropping and I'm debating putting more money in.  I just don't have as much as I would like right now.  I have $40k in liquid cash, plus it's $10k in sink funds. It's weird to see so much money that we are "Saving" in liquid cash.  Today was payday.  I have $5100 Property taxes, $4450 Sink, and $600 Roth IRA.  

I'm not sure what to use Sink funds for.  I was thinking kids lessons.  But if we can float it on our normal monthly budget i can save the sink funds.

Have you touched your investments?  Are you staying the course?

April spending, saving, and NW

May 5th, 2021 at 10:18 pm

We spent a lot in April. I don't know what happens but a lot just seems to crop up.  I will say that my suspicion has been since February that my DH eating lunch out and my kids too now 4 days a week eating lunch at school saves a boatload of money. It does.  We seriously don't seem to spend as much on food.

Groceries $589
Eating out $212
Alcohol $103
Dog $269
Travel $759
Gas Car $144
Utilities $708
Home Maintenance $1400
Personal Care $135
Auto $12
Home Goods $205
Office Supplies $27
Refi $500
Gifts $121
Misc $9.60
Services $390
Kids $948 - summer camp
Entertainment $93

While it's high I'm glad I'm tracking and we seem to be doing okay.  I am able to save everything.  I put $10k this month into the investment account so I have less in the Roth Account.  Guess it counts to my savings.

Roth $600

Property taxes $3100

Sink $4400

And our net worth went up but now down.  It's better to just say it's for the long term.  Anyway I am going forward with the refinance.  I think what I'm going to do is invest the $700 into the stock market.  Probably I'll just buy VOO and call it a day.  Dollar cost average and see what happens.  Maybe I'll buy some other stock. I just don't know.  If I were to buy a stock what would I buy?  Maybe a small camp might make sense.  So maybe VBK.  I think this will be a really interested experiment.  I'll track how DCA $700 into it makes and if it grows then I could be really far ahead with the arm. I will have $700/month for 7 years.  Of course the plan is to refi during that time again.  So the question will be when will it be worth it?  I think I'll look at refinancing when the balance of my loan is below a conforming mortgage and not jumbo