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my debt on the 0% CC

June 15th, 2022 at 08:10 pm

I have 2 0% credit cards right now, one I put on my A/C and the other I just put property taxes on.  I have until Feb and March 2023 to pay them off.  

Blue Amex 0% March 2023 $6041 - paid $2k today , $4041 balance

Wells Fargo 0% Feb 2023 $18,864 - paid $2k today, $16,864 balance

It's a lot more debt than I am hoping to carry.  I did use the DH's extra paycheck this month but basically it paid for our lawyer bills for setting up our will and trust.  That was $8800 paid for on a CC in full.  Everything else I've paid ahead basically.

Now how to pay off everything in 6 months?  I owe $20k in 6 months.  Ugh and yikes.  Our property assessed value went up 40% in 1 year from 2022 to 2023 so I'm a bit nervous about what that might do to our property taxes.  But I have $8k set aside for property taxes and auto insurance etc in August.  Guess I'll be posting on here to keep me honest.  I guess my goal will be paying off the $4k blue by august.


so what are you spending?

March 1st, 2022 at 09:17 pm

Things are going well for us financially and we are looking ahead to the future and the kids.  In a way that matters looking ahead at the future is easy.  It's easy to say wow we are good.  I'm not worried and relaxed and breathe. 

But taking time to smell the roses is harder.  It's the here and now.  Right now looking at ourselves and saying are we really enjoying our money?  Are we really enjoying our time?  That's two really hard questions.

This past year, and it's literally been 1 year, has been a lesson in budgeting I haven't struggled with since 2015-2016 when we went without income and took a sabbatical.  Since then things really relaxed again and we didn't budget.  We didn't really budget from 2010-2015 after we had kids but lived on a "pot" of money.  And all this time we have been really comfortable.  We didn't really want for anything, and honestly we still don't.

But a couple things have changed in this past year and last weekend when we were away DH made a comment to me "I don't want to worry about money period. I want to spend to enjoy the time we have when we have because I think we now have too much money and not enough time."  I fully agree, so much so that I want him to quit working asap.  I want him to realize the kids are growing too fast and all these snippets of time is sliding by.

So we are sort of having a windfall and I might as post it here since I did it on the forum that it's around $320k after taxes.  It's not an inheritance we earned this.  My inclination is to save it all.  But I know my DH doesn't want to. He wants to see a tangible spending of this money for something we want but don't need and aren't being "responsible".  But I am really struggling with that perspective.

I want to save 50% to kids college/brokerage. I struggle with putting it all into 529 because we already have around $40-50k per kid right now and more years to save.  But at the same time the opportunity to dump$75k into each 529 seems tempting.  Then i'd like to save $20k to ibonds this year and next year.  That leaves us with $80k.  Do we spend it?  Do we save it?

I don't know.  And if so how much can we allow ourselves to spend?  I feel our lifestyle is very nice and I would like to not budget but other than that I dont' know I'm ready to get nicer stuff than I have. 

markets crashing

February 4th, 2022 at 06:35 pm

So we are down $300k for the year so far.  Easy come easy go.  $150k retirement and $150k taxable.  Okay then.  That is life.

That being said we had a pretty good spending money.  $1335 on our return expenses from hawaii.  $274 on eating out, $520 on groceries.  I find that no matter what I do, I've really been trying to use our pantry up, I can't get our grocery bill lower. I also found that we are eating less meat but the veggies and fruits are just so expensive.  I buy 2 lbs of cauliflower fresh is ~$4-5 and that's only dinner.  Then add in more fruits and veggies through the day and it's a lot.  Last night we had half a package of broccoli from costco honestly I should be making more veggies for the kids.  We tend to eat a lot of veggies.  For dinner 2 heads of cauliflower/broccoli, or 6 zucchini and squash, 2-3 pounds of brussel sprouts each dinner. Then cutting up bell peppers and cucumbers for snacks and I adore mushrooms in so many meals as a side (I tend to buy it and just lightly saute it).  Also we typically have a fresh salad and our meal.  And our meats while smaller now proportion wise is more expensive which explains why steak for us $50 from costco for regular and not even prime.

Also I give each kid a whole fruit for school snack but thanksfully they have the (pretty unhealthy) but free school meals.  I know it's not just me because all the moms are talking about how much they spend when the go to the grocery store. It used to be $200-300/week is turning more like $300-400 or more a week.  Most of them don't cook as exapansively so they buy the same things over and over (their words).  So they can just see the prices escalating because they buy a lot of the same meats, veggies, and fruit in the exact same quantities. I tend to buy what I feel  like making.  

Part of it is that I also think there are less sales and deals to stock up on non-perishables or cleaning supplies or anything.  So things are bit sketchy.

Well either way DH supposedly got a raise, unsure when or how much but heck we'll take anything. I also don't know if he's paying more for health insurance.

Our bills typically are

$3200 mortgage (2% arm)
$1000 property taxes
$350 insurance (life, home, auto)
$500 kids extracurriculars
$200 electric
$140 cell phones
$160 water
$100 gas
=$5650 month fixed and then we have discretionary (groceries, eating out, and everything else) plus savings.

Discreationary should be around $2000/month but we are struggling to stay there.

That being said I have my furnance and other charges to be paid by Marhc 2023. Started at
12/1 $13025.77
2/1 $15373.45

Hoping to make some serious headway these next few months.

2021 wrap up

January 7th, 2022 at 08:26 pm

2021 was an interesting year for us in so many ways.  Financially we did well even with a paycut.  Our net worth went up about $500k.  We paid off 2% of our mortgage or about $15k.  We refinanced to a 7 year arm at 2% in June.  We currently pay ~$1400/month to rent our house and ~$1800 in principal.  We saved about 45% of our income even after the paycut.  

DH and I both started our own companies and not working for the man.  I'm self-employed and working solo.  We'll see how this year goes as my first year really doing it.  My DH started a company with others and is working like crazy as a founder.  It was a large risk but it appears to have paid off he's still working but it's going well.

We were fortunate to lose no one to covid this year.  Although my uncle passed away from old age my family did well overall for 2021 and that is amazing.  I'm hoping that 2022 is just as fortunate and everyone stays in good helath.  My DK1 was diagnosed with autism and it was a bittersweet moment.  Good because everything I thought and suspected was confirmed.  But at the same time it hard to hear and worry about the future had me stressed out for a month. I cried (obviously I blogged) a lot for a month.

But overall it was a good year.  I'm hoping 2022 will be equally well.  Happy New Year!  15 years (i missed my anniversary and so much has changed).  At that time we had a net worth of probably around $80k.  Wow. 

Inflation is crazy

October 19th, 2021 at 08:38 pm

Inflation is crazy right now. You can just see it everywhere.  In my car mileage sheet the year started 1/7/21 with gas at $2.60/gallon. My recent fill up a week ago was $3.60/gallon.  38% increase in gas in 10 months. 

Eggs were $1.79 for an 18 count at target in July 2021 is not $2.49 for the same 18 count.  Sugar 4 lb white bag was $1.79 it's not $2.49.  Dark brown 2 lbs sugar was $1.59 it's $1.99.  Chicken breast and thighs boneless/skinless was $2/lb, but now I'm lucky to find $2.49/lb.  Stew meat was $5.49/lb and now it's $7.49/lb.   I also think the sizes of things like chips, cleaning stuff have all shrunk an oz or two not easily discernable but it's the same "price" but you get less.  

Definitely you get less eating out.  I mean 3 bowls of noodle cost us $55.  I think the same restaurant last year was maybe $45?  This is for takeout.  Then on Sunday I had a girl scout troop event of pizza, pumpking carving, etc outside.  And I ordered pizza with troop funds.  It was $153 for 4 pizzas delivered.  Yes it was not dominos/pizza hut and higher end.  BUT $40 a pizza?  Pizza is supposed to be a cheap meal for people.  We had 10 adults and 10 kids.  Let's say for our family of 4 we ordered one pizza for $40.  Okay I could have saved on tip $20 and delivery $5.  But it's pizza.  The pizza itself was like $33 plus tax.  A large pizza at dominos was $16.99 plus tax and delivery.  So I was looking at $100 at a cheaper pizza.  Yep dominos still would be $100 to feed a group?  Pizza is supposed to be cheap food to feed large groups.  Not expensive.

Last year I spent $1000 on groceries and we weren't eating out because of covid, and I felt we ate like kings.  Lobster, steak, high quality meats, veggies, etc.  I could buy what i wanted for the family for $1000 and it might include alcohol.  Now last month I spent $990 and I certainly was not buying as much meat, nor seafood, nor as much fresh veggies.  It's crazy.  

And certainly from last year I have noticed how expensive eating out has gotten.  I felt like before okay a meal out was $60-70 mostly ethnic food takeout.  But now it's more like $100 and that's takeout same restaurants and same meals but smaller portions and each dish is couple of bucks more.

Am I going nuts?  Is this going on everywhere?  Does anyone else feel this?  I swear it really started ramping up as the summer ended. I don't think I felt quite this way before.  And of course part of it might be that we are living on a new budget, but still I feel like 6 years ago when we lived on the same budget it wasn't so tight.  I shopped easily on $600/month groceries very similiarly to my last years $1000/month so there was some inflation and my 5 and 3 year old are now 9 and 11 and eating adult portions (sometimes more than us).  But  price per pound is substantially more.

I think my family's noticed that I am really not buying takeout and going out to eat is minimal.  Now one takeout meal is $100 that going out once a week is costing us $400/month. Before $400/month was like 2x/week eating out.  

With gas, clothes, food, everything seemingly more expensive the budget just feels tight.  Have you even felt any inflation?

money flowing out

October 5th, 2021 at 07:06 pm

It's interesting to see all the money flowing out right now and being very aware of it happening.  Looking at my budget and thinking gee, I really need to watch my spending.

1. Brakes for Subaru - $700 the front and rear need the brake and rotors done.  It's 5 year old car and 46k miles.  Apparently it's due.  I had it checked at the dealership and a mechanic and both said it's due. 

2. Clarinet for DK2 $770.  If it's not one thing with kids it's another.  As they get older there is more money out the door.  I've considered renting but $30/month adds up and within 2 years that will be the cost of the instrument.  Inflation is rampant.  I bought DK1 flute for $580 3 years ago and i believe it will last until 8-9th grade.  In which case I will be getting her a much nicer not beginner flute.

3. Furnace $15k but I'm going to apply next week for a credit card at 0% financing.  But that means we are paying $1k/month for the next 15 months and not saving that money.

4. Increased property tax bill.  The assessed value of our home went up $200k in 1 year.  Yay for that but boo because it means a much larger tax bill. I also suspect that it'll keep on going up rapidly for the next few years.

I'm so glad we paid off our cars last year and our only bill is our refinanced mortgage.  It does ease my mind so I'm a bit worried about the 0% credit card.  

What happens when you aren't paid?

September 30th, 2021 at 04:50 am

When you aren't paid what happens?  Thankfully for our EF nothing.  I logged in and moved the paycheck amount from our sink fund into our checking account to cover our mortgage and bills.  Days like today I am pretty grateful I took the lowest common option and did the refinance from 30 year fixed to 7 year arm.  As ridiculous as it sounds the extra $720/month still went to savings but it just feels like if we had to we could cover the $3100 easier tha $3800.  

But this non-payment is probably standard for a startup.  Yes they have money but it's outsourced and there was a problem proabbly because it was a 3 paycheck month.  I suspect this sort of snafu will happen when you outsource the work.  Just like how we are navigating our new helath insurance which isn't as comprehensive as DH's last job but better in many ways because it's a better network (blue cross blue shield versus aetna).  Aetna was the worse because no one took it.   

Because of this I think that we are definitely looking at spreading out the cost of the new furnace. I think that outlaying $15k in one go doesn't make sense since we may have to cover this type of mistake again.   If people wonder this is what an Emergency Fund is for.  To not stress out about covering your expenses.  I do think Dave Ramsey is correct in being gazelle intense about debt.  But I disagree about $1000 baby EF.  That wouldn't cover half of our mortgage payment. If it were me I'd probably have an EF of at least half a month of expenses plus my mortgage payment.  Otherwise I don't know what I would do if we had only $1000 cash.

My progress budgeting

September 24th, 2021 at 06:57 pm

So I've always struggled budgeting.  Even before with less money I've alway reversed budgeted.  Figured out what was important and what needed to be saved and then spent the rest.

This time I'm sort of doing it but also sort of tracking my spending.  I've been reasonable successful at tracking eating out and groceries which are the budget busters.  It's easy to track airline tickets, hotel stays, or big ticket one off spending.  It's even easy to track monthly kid activity.  But I've found that miscellaneous spending, eating out, groceries seem to get away very easily from me.   Plus before our income seemed to be a bit of a mystery with bonuses and stuff.

Now we are on a strict income only with taxes and medical and it's the same amount every time.  We are netting $5800/pay period which is biweekly.  This needs to lower around $5400/pay period.  That means 2 extra paychecks a year.  But it's easier to budget $11600/month than it is to spread it out. The biweekly paychecks I was thinking should probably go to savings so we automatically save $11600/year getting us close.  This year we've saved close to 40% of our income but it was an odd year for income.

$3150 Mortgage
$720 Robinhood (extra mortgage)
$3600 Spending
$1000 property taxes
$1000 sink funds/savings/travel
$1500 Roth/ESA

We've been pretty good at sticking to this.  The only small problem controlling the sink funds/traveling.  I'm not sure we'll be perfect but we are trying.  I've been trying to maximize not paying cash for anything travel related and using all our miles and points. 

We also decided to spend $15k on the A/C furnace.  We decided even if we stay 2 more years the people who buy it from us might think a house worth $1m+ should have a new a/c furnace.  I'm going to try to get it on a 0% CC for the next 15 months with a 2% cash back credit card.  Then we'll make monthly payments instead of using all of our sink funds right now.  

Spending, saving and more

July 1st, 2021 at 03:58 pm

Where do I start?  Well I guess our retirement is on track at $1.5M we breached the number, up $280k from the start of the year.  We completed our refi to $845k @ 2% for 7 years.  I saved June and July difference of $720 into Robinhood and have $1443.  I'm investing it into VIOO (small cap index).  It'll be an interesting experiment if I can significantly invest in VIOO and help offset the potential increase in rate.  Of couse that's using the assumption I keep the house that long or don't refi again.  We did with our numbers hit our FI before DH's 45 birthday so that's good.  And no we aren't going to do it though.  And interesting tidbit is we have saved since the beginning of 2021 $79476 and if we count last year's savings of $16k for Roth/ESA in january then we are at $95473 for the year. My end of year goal is $100k (so $6k or $22k).  That $22k seems like  a large stretch.  $78k is about 29% of our gross saved.   

Spending in June was pretty good.  $669.45 groceries, $435.92 eating out, $438.91 dog, $519.73 (current trip gas and alcohol), $245.93 Gas (went camping and clamming), $400.63 Utilities plus other categories $3668.  Not a terrible month.  I was budgeting aroudn $3600 so we are on track. 

I moved $9k to our brokerage today wiping out our sink fund.  So we have $8k property taxes and no sink funds.  Things I see in August are our auto insurance and kids activties we need to pay.  I would guess around $3k.  But we have $4k in our checking just sitting so I'm debating moving the next two paychecks $1000 each to sink or brokerage.  

I have to admit once things go to our brokerage they don't ever come out.  So it's basically gone like our retirement.  I think that's why I struggle with moving money to our brokerage accounts from our cash savings.


An update - it's been a busy 2 weeks of june

June 15th, 2021 at 05:50 pm

Where should I start?  Guess with the most interesting.  DH's company turned down the buyout.  They didn't want to go back and work for a Megacorp.  I was surprised but at the same time someone pointed out they left their soul-sucking jobs to do something they believe in. They made enough money already that making more money didn't seem the point.  I can't believe it.  I'm glad because my DH is happy and still moving forward.

Spending for May

Groceries $454
Eating out $473
Alcohol $242.50
Dog $831.59
Travel $1802 (paid for August VRBO)
Utilities $752
Kids Camps/activities $1502
Business LAL $2491

It was a very spendy month. So good thing we refinanced our mortgage last week June 10th. No payment until August 2021.  We are doing pretty well though with our spending otherwise.

EF $40k
Property Taxes $8k (done for 6 months ready for 11/1 Payment and insurance in August)
Sink $5000 (haven't had to touch yet)
Roth $2000 (already saved $10k this year moved it)
Robinhood $700 (my difference in refinance and old mortgage June $700 saved!)

I believe we managed to save $2k from last month and float all the extra charges without touching our sink funds which is what was part of the budget.  My goal is to pay our insurance without really touching the sink funds or property taxes in August (home $1200, auto $1000, umbrella $300) and then also still continue to save $700 7/1 and 8/1 and 9/1. I invested the $700 in small cap ETF Vanguard IWOO

Our networth was up in May by $3886/month.  The markets were down.  But we are up for the year $293469.  Also I did not move the needle on the value of our house.  It appraised by the bank lower for sure than what we could get and a lot higher than what we paid.  



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.

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

Savings and end of month Spending

April 29th, 2021 at 03:55 am

We spent a lot this month so far on everything.  I also did a rough breakdown of our 2021 taxes and we appear to be getting a too large refund of $10,158.  This is because DH is paying double SS and it will come back to us when we file.  I guess that takes care of me saving for Roth IRA next year. I don't know whether to count it as this year or next year savings.  Suggestions?

Groceries $533.20
Eating out $206.34
Alcohol $103.09
Dog $137.70 (will pay $250 at vet tomorrow)
Travel $759.03 weekend trip expenses of eating out and stuff
Fuel $144.81
Utilites $697.88 (water bill bimonthly and late)
Home Maintenance $1400.06 (yard, fence, Gutters)
Home Good $205.27
Gifts $121.89
Refinance $500
Services (cleaner/yard) $390
Amazon $105
Kids $898 (camp and extracurricular)
Entertainments $93 (bought a couple of living social paddleboard rentals)
=$6702 month.

What a very expensive month.  So I'm trying to run lean. But on the plus side our savings.

Moved $10k to Brokerage account this month and paid $5353 for our property taxes.

Roth IRA  $10,600 - moved $10k so $600 left in account.
Sink Funds $4450
Property Taxes $3100

With the refinance we are moving our payments down $700.  I am going to try and save it.  It will certainly be enough to cover our sink funds.  I'm not even sure I am saving the right amount for sink funds.  I guess at the end of the year I'll figure it out and move what excess we have.  My goal for the year was 20% savings with 15% to retirement and 5% savings.  That is $49,061 = 20%.  I currently have saved $53,633 so we have exceed that goal.  The 5% stretch is $61327.21 while the 10% stretch or 30% of our gross salary is $73592.65.  I wonder if we'll hit it?  $19959 is need to hit 30% saved.  If we count the tax refund of $10,158 I bet we would hit it. I have 7 months to save $20k.  

Either way I think we'll be successful.  We are getting on a budget and working it. 

Do I want to budget?

April 21st, 2021 at 05:33 pm

Do I want to budget?  No. Do I have to budget?  Maybe.  Should I budget?  Yes.  But can I budget? Yes.  How does it work?  Well you are right now on this blog seeing an evolution of a non-budgeter. You will see if it happens or not.

Why?  Because there are a couple of things at play.  First off I have never budgeted. I hate budgeting. I keep a rough budget by "pay yourself first" and then spend the rest.  I never actually tracked categories but rather had I could spend $3500 on CC and that was it.  So a rough budget but I wouldn't be able to tell you categories.

Now I am trying to see where my money goes and how I spend it. I am keeping a rough budget in the sense that I am trying to curb my eating out and groceries.  But I know that many places say before you can keep a budget you need to track your spending for 3-4 months to get a feel for what you are spending on.  That I think is a key thing.  I have a general idea and rough feeling for spending I did.  But for us we are doing this because our income change dramatically and we need to live differently.  So I think this will be an evolution for us.  As we learn how we spend and rein it in becuase of our income.

Also now that we are taking over escrow and refinancing things are going to change more.  I dont' know if others struggled or worked this hard but I will say it's harder than it used to be.

I find NSD hard

April 13th, 2021 at 08:59 pm

So I may not go out and spend money and it's super easy to do that during covid.  But I still find NSD hard.  Why?  Because I notice a lot of little things pop up here and there.  Like I have two medical copays that came in and I should pay today.  I already paid $610 for 2 summer camps for the kids today.  I also had to give a neighbor a check for $345 for our share of the fence repair.  So in one day I jsut spend about $955 without leaving my house and getting anything to show for it.  Yesterday I spent $54 at the vet for another blood test for the dog. 

So I haven't grocery shopped since Saturday when I spent $46 on veggies for the week. I am eating out of the freezer.  It's overly full because of our trip and we have too much bread so the kids and I are going to be eating sandwiches.  I also bought 1 week ago a $61 rib roast and it was enough for 1 meal (we invited our covid family over) so 4 adults and 4 kids ate the smoked bone in rib roast.  That brings our grocery total to $298.40 for the month so far.  The alcohol is $77.18, and the eating out is $26.69.  We plan on going to brunch on Sunday and I'm expecting $100 for that.  Then another $50 for veggies for the week and trying desperately to eat our freezer.  

I think what happened is that I overbought on meat last month because February we had used everyhing up.  Then I stocked up too much and now I don't need to buy meat for awhile. I also stocked up on toiletries and paper products and cleaning supplies so that will also be awhile.

That being said I wonder if I can ge back to complete no spend days.  Tomorrow DH is paid and I am deciding between moving $1000 to Property Taxes or Sink Funds or savings.  Unfortunately we have to wait until the next paycheck to put the rest of the money somewhere.

trying to plan spending for the year

April 12th, 2021 at 11:50 pm

I don't know if others find it hard to plan spending for the year.  I guess because I don't have a straight budget plan yet.  I also am unsure how disciplined I want to be with "savings".  I definitely want to save for things like property taxes and sink funds but the retirement?  

So here's our basic budget and I need to figure out how to make things work.

$10914 Income

-$3850 Mortgage

-$1000 Property Taxes (Savings account)

-$725 Sink Fund

-$1500 Roth IRA

= $ 3839 leftover.  

That should be enough but I am worried it's not.  Mostly because it's supposed to cover our travel expenses and just overall expenses.  If we spend $800/month groceries and $200 eating out that leaves $2800 for utilities, gas, etc.  Right now it doesn't seem like we can get a handle on spending, but we'll have to see.

Sadly this month we are $298.40 Groceries, $26.69 eating out, $77.18 Alcohol, $120 Dog, $759 Travel, $45 gas, $557 utilities, $55 Home Depot, $35 personal care, $6.60 Auto, $77.13 Home Stuff, $112 Gifts, $180 services, $9.61 Misc, $154 Amazon (sound channel), $168 kids, $99.15 Clothing (will return 1-2 jeans) = $2781 to date for the month.  

We plan on going out to brunch on Sunday with friends so there is that.  Also we do have t osome shopping more for groceries.  I'm hoping to have many NSD the rest of the month.

Travel Weekend and spending update

April 9th, 2021 at 06:22 am

Well so for the 4 day weekend we spent $759.03 total.  That includes gas, groceries, and eating out.  The VRBO our share was $710.  That means for four days we spend $1470.  Ouch.  Well that's how the cookie crumbles.  Mostly it was staying with people who spend like there is no tomorrow.  Like I told DH it solidified why I normally don't stay in VRBO with people.  First time and probably last time.  Our sleeping habits has always been the reason and it still was a problem.  We like to stay up late and wake up late and roll on out of the house late.  So I'm good.  We spent $562 on food for 4 days and came home with a ton of food that we would never have bought and wasted at that price.  It's fine I'm okay but I would not have been buying foil, saran wrap, paper towels, paper plates, etcs all stuff we paid top $ for from the grocery instead of bringing from bulk from costco at home.  Like I said I am not cool with wasting money or food.  Lesson learned.

So our spending for the month. This month we aren't doing as detailed grocery posts but I am tracking overall spending.  

Groceries $252
Eating out $26.69
Alcohol $70.92
Dog $66.09
Travel $759.03
Gas $45.57
Utilities $427.31
Home Maintenance $14.90
Personal Care $35.27
Auto $6.60
Home Goods $77.13
Gifts $75.57
Misc $9.61
Services $180 (cleaner $120, Yard $60)
Amazon $211 ($121 sound channel, $36 Birthday Presents, $54 Battery pack and chargers)
Kids $173.49 ($135 piano lessons, bike helmet)
Clothing $99 (3 lucky jeans will return 2 after they come)
=$2526.19, trying to keep our spending under $4000 for the month.

Our rough budget is
$10,900 Net Income
-$3843 Mortgage
-$1000 Property Taxes
-$1000 Roth IRA
-$750 Sink Funds
Leftover $4307

While saving the extra 2 paychecks a year. That's what we did with the extra paycheck.  Considering we are 8 days in and we've spent 58% it's not looking good.  Goal is to not spend more than $100 on groceries and I need to rein in DH from spending on amazon and online on crap he wants for shed and house.  We have another $100 next week for Dog Vet Visit.  And registering kids for a summer camp.

But I'm meal planning through the next week.  I bought $61 rib roast on tuesday that will be for Sunday.  I am making butter chicken tomorrow and pulled out my hambone soup to eat.  We are eating sandwiches for the next few days.  Monday I need to make 2 lasagna (giving one to DH's cousin when I pick her up from airport Monday night).  I plan on making japanese beef curry next wednesday with stuff we have.  I also have to make yogurt and beef keema next friday.  I'm thinking I just need $75 of fruits and veggies in the next week maybe.  I have so much bread right now that sandwiches are on the agenda for awhile for lunches for kids.  I also still have a lot in freezer to eat through.

Q1 spending and April Goals

April 2nd, 2021 at 12:10 am

So I spent some time teasing apart my spending.  In March as I tracked $820.79 Groceries, $86.82 cleaning, $167.14 alcohol, $112.72 eating out.  Total CC spending across 4 cards is $4586.27 for the month of March.  Bit higher than I would have liked.  

My year to date spending is as follows (1/1-3/31)

Travel $2438
Pet $3310
Groceries $2713 (not teased out the cleaning supplies and extras but I'll try to be better in the future splitting dog food, clening suplies etc)
Hobbies (ski gear) $1290
Restaurants $421
Gas $409 
Alcohol $308
Healthcare (lots of dental) $758
Gifts $889 (DK1 got ears pierced and nail salon)
Cell Phones $674 (bought 2 cell phones $135 LAL, $208 DH) and 3 months of plan
Home Improvement $460 (DH 100%)
General Merchandise (crap we buy from Amazon and online) $599 (this is mostly DH by the way)

April my goal is $750 for groceries, $100 alcohol and $50 cleaning supplies so $900 total.  And our overall spending under $3k on the credit cards including groceries.  So that will leave us with room to save.  It might not be possible with me needing to pay for a couple of summer camps.  

Of course I already blew it today....I spent $135.28 on groceries, $45.47 on gas, $9.61 at Dollar store, $14.90 Home Depot, $66.09 Dog Food and treats, $70.92 alcohol.  So we have started the month at $419.50 spent.  UGH!  Then eating out this weekend and gas for driving.  So I might be dying on the groceries already.  Or I can eat everything I have and be super cheap this month!  Nah. I want a rib roast and I have my eye on making beef wellington.  My pantry and freezer however are stuffed to the gills for some reason so I do need to eat what I've bought.

2020 Spending Update - Questions answered

March 31st, 2021 at 06:19 pm

I realized I never responded to people's questions about our 2020 spending.  So I decided I would do it now.  First off Disneysteve asked how did you spend $22k on travel in a lockdown year.  Well first off when we travel I do not breakdown eating out or gifts, etc.  Traveling is everything, everything we buy to prep to uber to eating out to gifts, anything and everything that is not because we are at home.

Jan $1200 - 2 ski trips 
Feb $1915 - Hawaii, probably bought tickets in 2019
March $2637 - ski trip and booked couple of hotels
April $2353 - future hotels ( i wonder if I got this refunded)
May $2711 - weekend away was $1500 with $600 hotel, but also $1400 hotels
June $2727 - start of road trip and i can tell by activities and eating out no hotels
July $3886 - road trip and $517 deposit on January 2021 ski vrbo
August $0
September $0
October $0
November $3287 - tickets to hawaii and VRBO final payment $814
December $2025 - some ski tickets and all spending in hawaii from eating out, groceries etc

Wait I found $8861 refunded by "travel" category of alaska, expedia, etc.  So I guess we spent $13986 on Travel for the year.  That looks better than $22k, but still $14k is a lot.

We spent $15727 on groceries with a refund of $1187 = $14540 for the year for a family of 4.  This I can answer.  I did not shop sales and I semi-meal planned in the sense I looked at what I had but I did  NOT look at a price book or flyer and instead I just cooked whatever I wanted.  I do not usually buy junk food (see this month everything) but I did buy mostly organic and mostly whatever I wanted. In March 2021 we did not do our normal sushi, seafood, and steaks once or twice a month food runs.  I will buy prime steak, lobster, and sushi at least 1 a month each usually friday nights and make it at home.  Also we had two additional adults for at least 6-12 meals a month (dinner).  DH's cousin and boyfried were eating with us most weekends to help build shed and I both bought take out and cooked for 2 adults more food and more booze. She also watches our dog when we travel so we usually pay for everything. 

And yes we buy expensive cuts of meat and seafood.  We are not food wasters by a long shot.  NOTHING really goes to waste.  We also do not buy processed foods either.  BUT we buy everything not on sale and on demand. I bought anything I wanted when I wanted it.  So I would walk into a store without a plan and throw things in the cart. I will decide I want to make X, Y, or Z and just buy what I needed to make it.  I didn't waste food.  We eat everything and I buy premium stuff in smaller quantities so I didn't waste anything.  But there was NO meal planning or prepping I just wanted mushrooms great I bought it.  I wanted pork shoulder or pork chops?  $8.99/lb no problem.  Sure $30/lb no sale for sashimi = no problem.   You see the problem.  We do once a week leftover night where everyone picks leftovers that isn't enough for a meal and then we eat it.  That's how we don't waste anything.  I make fried rice from old rice. I make stews and omelets or mishmash from leftovers.  So food isn't wasted but my food wasn't cheap to begin with and i never actually looked at the price and went "oh that's a lot." I just threw it in my cart.

I think I get this from my mom.  She said a woman once told her "you know you've made it when you walk into a store and buy what you want, when you want it.  Because you no longer look at sales."  And she does.  I sort of fell into this mindset.

Jan $1705
Feb $596
March $1715
April $844
May $1659
June $1504
July $1154
Aug $1257
Sept $1265
Oct $1922
Nov $1555
Dec $557

$13048 was spent on buying crap with $3894 refunded so $9154 spent actually.  What sort of stuff?  Amazon, target, walmart, etc.  Stuff for house, stuff for kids, etc.  I will try to be better this year.

$6290 on Restaurants with $240 refunded.  The breakdown you cans ee the lockdown definitely put a crimp on our eating out.  I think I've mentioned before we used to spend I know around $1k month eating out and $1k month on groceries.  Again I just bought take out when I felt like it.  No waste but eating out for us expensive because eating out is expensive for a family of 4 at "nicer" places.  $75-$100 is not hard to hit even takeout.  After march we ate outside 2x the entire time both times in september.

Janurary $757
Feb $787
March $695
April $310
May $483
June $289
July $356
Aug $618
Sept $648
Oct $315
Nov $597
Dec $441

So that's our spending. I definitely need to tease out our spending in general. I need to probably look at mint because personal capital is having problems.

But I also think I need to average out my spending since I'm becoming more aware.  The first two months weren't great but we're improving.  We had a goal of $950 for groceries, alcohol, and cleaning.  We spent $1100 but we were over our grocery part by $20.79!  Next month dare I try for $675 thrify plan?  Let's look at 2021 bigger picture first.

Final Grocery Update and Payday and Savings

March 31st, 2021 at 05:08 pm

So I did go to the grocery store last night and I bought one last thing before the end of the month.

3/30 FM $14.90

Turkey Breast $7.11 (1.29/lb)

Pie Crust $1.79

Frozen Spinach $1.50 (4x$1.50 = $6)

= $14.90 Monthly Total $820.79!

Bringing out monthly grand total $820.79 for groceries for our family of 4 and with TONS of food in the freezer.  We spent $112.72 eating out for the month and $86.82 on cleaning stuff.  I plan on buying dog food, vitamins from costco later this week thinking Thursday or Friday for April.  I'm going to make a list because it's on sale and I have some backup under the sink but I like to have at least a 6 months supply usually.  We also spent $167.14 on alcohol.  We need to buy next month some champagne (mimosas for easter brunch) and vodka.

Today was DH's 3rd payday of March.  Very excited.  He got paid $5554.66 today and this is not part of our normal budget.  So what did I do?  Well I saved every penny of it.  I moved $5600 to our Roth/Savings Fund.  I also moved $1200 to our Sink funds, $1000 to Property taxes which we used to escrow and $6500 (check of $6488.78 escrow from JPMC) and tomorrow our mortgage is paid $3850.  

Our current balances

Checking Cap 1 $5309

EF $40k

Roth/Savings $8600 for year (on pace to save $16k, love to hit $36k for year)

Sink Funds $2400 (budgeting $720/month i'm a little short and might move more)

Property Taxes $8500 (on target and paying $5500 4/30)

BofA $6785 (earmarked for paying off Chase card below)

Chime $400 (with 2 $75 bonuses thanks for referral!) PM me if you want referral link

I owe $5700 on our chase card closing 4/6/21.  We are going away this weekend and I think we may spend $1000 on eating out for 4 days most meals.  I'm being a bit overly generous because I'd rather not feel bad for 4/3-4/6.  

Tomorrow I'll do a wrap up of spending for month and new monthly goals.  

Why I should sell my house but I won't

March 24th, 2021 at 07:57 pm

So I'm not a big proponent of the "latte" factor. I don't think that lattes add up to much.  Maybe they do when you have low fixed costs, big income, and spend more than you make.  But when you live pretty reasonably, aren't a big spender but can't make ends meet, there usually is a bigger picture problem.  Most often the culprit?  The house or the car payments.  Usually those are out of line with the income.  The rule of thumb is 28% mortgage, 32% for payment, taxes, insurance, interest, 40% all debt payments.  That means maybe you bought a 20% home but then you spen 20% of your monthly or annual income on car payments.  Seriously car payments add up fast!  Those two things can suddenly make the budget tight and make it difficult to save and difficult to get ahead.

So on to LAL, what can I say?  Our mortgage is 25.8% of our gross salary. So we check that box.  Our PITI is 32% of our salary so technically we check that box as well.  We have no other debts so we are at 32% total debt.  I was smart enough to stop carrying our minivan loan in September 2020.  But here I am feeling the pinch and dreading cutting our lifestyle and trying to save.  So how is it playing out?  Where are we going wrong?

I think we are going wrong because we are used to living on our salary and just saving the rest.  What I mean is prior we would just save the maximum for 401k, employee stock purchase plan, or after tax into 401k and then live on the rest of our salary.  Then the bonus cash and stock would go to pay taxes and savings.  First time in our adult working lives we don't have a 401k. 

That simple change mentally makes it harder to see our deposit and getting to spend it like we used to.  Before I knew we already had automatic deductions take out for "savings".  I also knew we were not planning on spending our bonuses or counting on them so it was easy enough to do a sweep into our savings account.  Usually I also paid a higher percetange of our bonuses in an estimated payment to the government because they never withhold enough for our bracket.   So now I probably need to automate $1500/paycheck (too hard biweekly to calculate) straight to Roth IRA/ESA account and see if we can't live on that.  I think that extra 2x/year paycheck needs to go to savings and I need to scale back how much from 2 paychecks we put into our monthly savings.   This is going to be a learning process again.

I'm not a very good budgeter or tracker.  I prefer the save first and spend the rest. I also prefer to have it taken out and see only what we get after taxes.   

But here is where we are shaking out wrong

Income 100% 

Mortgage PITI 32% $60k/year

Savings Retirement 15%

Short term 5% - this if my flexible

Federal taxes 10.32%

SS/Medicare 6.36%

= Leftover 31.32% leftover  - this should be enough. Works out to around $56k/year

I just am not sure.  I think I need this year to see if we really can save 20% and live on 31%.  It doesn't seem that far off from our prior spending, but we have to be more mindful and scale back our traveling.  Also I believe where I am having trouble is realizing that we are going to be paying a lot less in taxes.  

So our house isn't "unaffordable" but it definitely makes me feel tight.  Our current salary is $180k/year.  Our mortgage is $3800/month and $1000/month taxes/insurance.  We should be able to manage to save that 20% or $36k/year.  Our mortgage is currently $850k at 2.875% 26 years left.  According to the 3x rule of thumb we are at 4.72x.  Thus we are over.  We are also at the highest end of what you should buy and probably why we are struggling with saving 15% to retirement and 5% to short term.

If we managed to get out PITI to 25% that would give us a little more breathing space on the living expenses and still save 20% comfortably.  When we bought the house 4 years ago we were at 3.7x and 22.8% PITI off of base salary.  We were also approved for a lot more house but bought something we felt very comfortable with. 

When I agreed to this salary reduction in August 2020 I knew we were going to struggle a little at first.  We hadn't been budget constrained in a long time probably over a decade since before kids.  Mostly because we were usually very conservative with our housing and fixed costs.   This is a short term reduction.  If it doesn't pan out for DH in 2 years he'll go get a regular job.  No we can't guarantee what he'll make but if it's closer to what he was making we'll be fine.  So I'm not selling the house.  Should I? 

Maybe.  But in this case it's for less than 2 years and if we can manage without touching savings and even saving I think we sit tight and give it ago.  Now in 2 years if he looks for a job and can't find one paying what he's currently making then we reconsider selling the house.   I don't think long term I want to be in this situation.  But short term we can make it work.  Also if he was making $180k long term we'd have to reconsider moving elsewhere.  Because to me that's not enough to make it where we are. 

Where we live rents are higher than our mortgage running around $4000/month.  With the tax break 24% on $25k interest and $10k property taxes we are looking at "renting" our house for $27k/year and "saving by princpal paydown" $21-22k".  So to correctly assess our interest it's $2500/month.  The principal paydown can't be equated to rent.  So the tax break also has to correctly be assessed to determine if renting is better than buying.  For us no?  If we were buying now?  Well probably yes because to buy our house now our mortgage would be at least another $1000/month more and our property taxes an extra $2-3k/year.  So an extra $1500/month would definitely put it on par with renting if not a better reason fo renting.

Anyway that's how things are unfolding for us.  Guess it'll be an interesting 2 years.

teasing out our spending

September 24th, 2020 at 12:14 am

I spent some time this past week working on personal capital looking at our spending. Okay it's out of control. This pandemic probably helps but it's interesting. We have been spending less on things you would expect like groceries and eating out but more on stuff like home renovations, school/office stuff.

2019 Spending
$22149 Travel
$20713 Groceries ($1727/month)
$10759 Pet (dog surgery)
$9358 Eating out ($780/month)

2020 Spending thus far
$17550 Travel
$12467 Home Improvement (shed)
$11548 Groceries ($1316/month)
$4689 Eating out ($521/month)

What is interesting is that our grocery bill dropped while we are eating at home most of the time and DH no longer has free lunches/snacks. Last year we were spending that much and DH wasn't eating lunches. Now 4 people eating 3 meals a day at home and we're lower groceries and lower eating out. Also groceries has gotten much more expensive during this period.

We are saving about $650/month food, no kids activities, less traveling, which it doesn't seem like it but it is. I would say we are saving at least $3k/month.

We'll see how the rest of the year plays out. We have about 6 more months until the new budget resets.

PITI Rule of Thumb

September 8th, 2020 at 09:42 pm

Home purchasing has rules of thumb. The general rule of thumb is 28% PITI. So your mortgage should be no more than 28% of your income. The second part is 36% of your gross income including all other debts. Meaning if you have a lot of medical, student loans, credit cards, car payments, your entire debt load should be no more than 36% of total income. The flexibility is if you have no other debt you could stretch more and buy more house. Or if you have a lot of student loans maybe the answer is to buy a smaller home or wait for a bigger down payment.

So you know we are in the process of refinancing. We are also in the process of taking a salary cut. We have been in our current house 3 years. When we bought it we were at a PITI of ~20%. That was pretty comfortable. I have to say that staying within the 28%/36% isn't a bad thing.

But now we are creating a new budget and our PITI is at 30% and I have to say it feels tight even without us going to the new budget. This is the first time in a long time I recall what it was like to live where we stretch ourselves to afford our home. We are officially going to be "house poor" again.

When we bought our condo in 2002 we were at about 40% of our income and it was tight. But we weren't saving for retirement and we were used to living like students (which we were). In 2005 we bought our townhouse and if I recall we finally were comfortable at 30% PITI. It was a bit tight but getting easier. During the next 10 years we had a couple of promotions/raises, lost 1 income, and refinanced our mortgage to get it down to 15% income. It was awesome. We were finally able to really save and enjoy life.

We moved, rented, and then bought 3 years ago. And when we bought at 20% income it was really comfortable because really it was much lower with DH's income skyrocketing. But now we are going back to a much tighter budget and suddenly the house is looking like an albatross.

I am grateful we bought way less house than we could afford. But it makes me reflect that often times people struggle to budget and get out of debt. And I can see that easily happening to us. It's not the small things. We don't have any other debt so in theory we could afford 36% PITI and we are at 30% PITI which isn't much more than 28% PITI. But every % counts and it really just has this ripple effect on the rest of the budget. Makes you more aware of how much your heating/utilities are. Makes you aware of how expensive your daily starbucks habit it.

While the truth is the $100/month starbucks habit shouldn't be why you can't afford your house. Your house should be affordable because you bought it to be affordable. Not looking to scrounge. I guess now that I'm in that position of examining every expense. If people ask me my opinion?

I can now firmly state that I'd rather have a smaller mortgage and less house and be able to comfortably afford it than something we stretch to buy. And as I get older it's so much harder to live the same lifestyle we had in our 20s that we did. So our lifestyle is different.

Have you noticed a change in lifestyle from 20 years ago? Do you think you could go back to when you were younger and made less money?

Budget Revamp

September 4th, 2020 at 05:11 pm

Okay so a budget revamp is due since DH is switching jobs in March 2021. Our budget I think will be done annually. It'll be easier. This is our tentative budget for 2 years. Right now the plan is to fund our Roth IRA @ $6k/year and 2 ESA @ $2k each.

Salary $180k
-$60k mortgage PITI
-$25636 Federal Taxes, SS, Medicare
-$6000 Medical (no idea just estimating)
-$3000 Auto Insurance/Umbrella
-$1800 Electric
-$1800 Water
-$1200 Internet
-$3120 Cleaner
-$1560 Yard Guy
-$1400 Life Insurance
-$2400 Gas (this is obviously down for 2020, but in past)
-$12000 Groceries
-$6000 Eating out
-$6000 Kids extracurriculars
-$12000 Roth IRA
-$4000 ESA Kids

=$148,516 spent

= $31484 Leftover

Here is the problem. That seems like a lot of leftover. Enough to cover saving for retirement at 15% = $27000. That means we need about $13k more than we were planning on saving. And it seems tight since $31k slush I think needs to cover our misc spending and travel and things that happen.

I'm thinking if we compromise and do 10% savings on $180k so $18k, so if we move $2k into savings cash or 529 then we'll hit 10% savings rate. Yikes.

Looking at a finer tooth comb for our spending historically we spent $115k last year not including the mortgage and $102k in 2018 and $88k in 2017. Lifestyle creep. We've gotta rein it in a lot I think.

I think we need to start with the basics. Tracking what we spend till the end of the year. Then we start living on the new salary. We are refinancing our mortgage and it will go down another $500/month. We just spend too much money. I am feeling it now looking at everything with a fine tooth comb. I'll probably post in January/Feb as we get closer to it in the forum for picking over.


March 17th, 2018 at 02:17 pm

Wow okay so I wrote over 50 checks last year. Crazy. I thought checks were a thing of the past turns out not. Check bill pay does not seem to work for me. I tried 3 times to have them mail a check to the guy who came and cleaned our gutters. I also am told to send a check to the school for activities. They don't seem fond of having an electronic check sent. Nor does the music teacher. Pretty much any kid activities wants a check cut unless they take credit cards.

I only realized this as I am looking over our annual spend and figuring out our taxes. I am pretty sure pre-kids we pretty much never wrote a check.

Oh well. I guess this explains why we run through checks a lot faster than I thought. When I told DH his eyes opened wide. Of course he pays no bills and hasn't cut a check in years. So he was floored. I can now see how many moms walk around with a check and comment "i am constantly cutting checks for every activity." More kids = more activities = more checks. Yes even if it's one activity it's still one check.

do i need an ef?

March 16th, 2018 at 12:46 am

Years ago we ran so lean that every penny had to be accounted for so we didn't overdraw on anything. Our credit cards functioned as float but we basically ran it as a check register. No extra pennies anywhere. We squeezed dollars till they screamed.

But the things got easier for awhile and then we had kids and went down to one income and it was tight again for awhile. Then we decided time to get serious again and we started saving hardcore looking back we were at 50% savings again. We had made a plan in Christmas 12/2012 for 6/2016 that we were going to save 1 year of living expenses and move without jobs. We bumped it up to 6/2015 and we saved more than expected.

Anyway we lived on our savings (ie spent it the horror!!!), then knew we wanted to buy a house so we kept a lot of cash on hand for 2 years from 6/2015 to 6/2017 and then even after. We paid 100% cash out of pocket for our $75k renovations this year. No debt. We also bought a car and put down $8k.

But it appears we are unsure what to do about our saving again. We are back to having a "normal" EF of about 8 months cash. The problem is my DH I think feels insecure now and talks about having 1 year sitting in cash. I think not a good idea.

Second, I think that maybe we should start running lean again and have 1 month cash on hand and the rest we invest in something.

I'm struggling because I do think the stock market is high and I'm not sure I want to invest more in stocks right now. Second I'm really becoming interested in investing in real estate as a diversification in our overall portfolio. Not something we fall into but a real investment and bought solely with cash flow in mind.

But the the housing market seems red hot right now and I'm not sure it's the right time to plunk down cash. I mentioned the duplex a co-worker is selling that I've considered. It wasn't enough of a return to generate making it worth investing right now.

But if we are serious about getting into RE i think we need the cash to put as a down payment so investing it in stocks doesn't seem wise either. Nor does running with a lean EF. We probably should have a fully funded rental EF.

For people who invest in RE what's the wisest decision? For people not invested in RE is it because of the entry barrier in cost? Too much time? Too much risk?

I have been pondering this for awhile actually. What we should do regarding our Emergency Fund and whether to invest it for now or to wait and perhaps buy a property.

Overbudget and over time

December 1st, 2017 at 10:11 pm

Well we are officially over budget and way over time Well the timing thing is tight. The contractor told me Thanksgiving which I always thought was optimistic. Turns out I was right. As it stands we are hoping 12/20 before my parents arrive. Of course it won't be completely done the glass shower door and side won't be done. That is looking like January but hopefully everything else will be done.

We are currently framing the windows and just finished priming. We have to paint and do the tile of the fireplace and floor. Then there is still the upstairs work and attic, fan, insulation to still deal with, which I may tell them come back in January. We've got guests for the holidays and I don't think I can deal.

Budget wise we are over period. Over my "budget" not what they told me. When we started we were at $3700 for garage doors, $55k contractor, and $5k for designer and OOP. I figured we would come in around $75k. We are at $77k and not done. I knew things would come up and things would change But I was thinking 20% over was generous. I was wrong.

Things that changed? Our shower was rotted, we finished the garage, moved a door, found rot on the siding, replaced some rot and reinforcements. So our change orders are currently at $18k and we aren't done yet. Things happen when walls come down and you don't know what's behind them.

Oh well. I hope this works out okay. We are in so deep that we can't turn back now. Whatever it's worth I think if I escape under $100k I'll be happy right now. I don't think we should be that much further over I am going to guess $85k all in. But don't hold me to this. I'll continue updates and more importantly I'll post photos when it's done. I can't wait.

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