Real Family Budget Update– April 2020

Who else spent $0 on fuel in April?  It was definitely a month unlike any other!  I can’t think of any time we have not spent anything on gas!

We didn’t spend from most of our sinking funds either.  But we added a new sinking fund.

Since we are not going to the grocery store and are focusing on eating from our long-term food storage, our food spending is super low.

Our Airbnb income took a major hit in April, and we expect that will continue for a while.  We did get a huge stimulus check, though we haven’t spent any of it yet.

Keep reading for all of the details from April’s budget!

Every month we make our personal finances public by sharing everything we earn, spend, save, and pay toward debt.  We’ve been sharing our finances since back in September of 2013, when we had six figures of student loan debt, and we haven’t missed a month!

Our hope is that getting an inside look at one family’s way of budgeting will give you ideas on how you can make budgeting work in your family.  Of course everyone’s income and priorities are different, so everyone’s budget should be different too.  We’re happy to answer questions about why we do things the way we do and we hope that you’ll be inspired to start (or restart, or continue) your own budget!

The Debt Smash-athon is also back in 2020!  If you’re working on paying off debt this year we would love to have you join us!  If you’ve got savings goals instead of debt, you’re welcome to join in too! You can report your April debt payoff (and savings) progress right here!

Let’s jump into the numbers. If you want to see everything in our actual YNAB budget, check out the video below!

Income Earned in April – $13,455 (includes stimulus check)

We live on last month’s income. If that doesn’t mean anything to you, check out the video explaining how living on last month’s income changed our lives or the post explaining how we got to that point.

The income section shown here is the money we earned in April, which has all been set aside to use in our May budget. (The spending section below shows the money we earned in March and spent in April).

Attorney Income – $6,716 Mike works as an attorney for the state of California.  This is his take-home pay after taxes, social security, health insurance premiums, union dues, and parking fees are taken out.

Blogging Income – $1,046 My blogging income was super low.

Airbnb Income – $293 We took a major hit to our income here since our rental was vacant for most of April.  We usually earn arount $1,600/month renting out our little one-bedroom apartment.  If you’re thinking about renting out your space, check out Mike’s post about dealing with insurance for your Airbnb rental or our explanation of how we handle our Airbnb finances.

Economic Impact/Stimulus – $5,400 With each adult getting $1,200 and each child $500, our family received $5,400 from the COVID-19 stimulus check.  We didn’t spend it in April.  As with all of our income in April, it won’t be spent until May.  At first this seemed like a big windfall, but seeing the hit our Airbnb has been taking, those funds will essentially be covering the drop in our rental income due to decreased travel over a few months.

Spending in April

Each month we budget the previous month’s income down to zero.  This is how we spent the money we earned in March.

Giving

Tithing – $2,318 We always pay a 10% tithe on our income.  This tithing (like all of our April spending) comes from the money we earned in March (which was way more than normal–you can read about March’s income here).  You can read about our thoughts on paying a 10% tithe here.

Fast Offering – $100 Each month we take one day to fast (go without food and drink) for two meals and make a donation to help the poor in our area.

Monthly Bills

Mortgage – $2,781 This is our newly refinanced mortgage.  Mike just published all the details and shared our experience with a true no-cost mortgage re-fi. This might seem like an odd time to think about refinancing your mortgage, but rates are currently as low as they have ever been in the last 100 years, and anyone with a mortgage interest rate above three percent is likely to find a better rate now, putting real money in your pocket every month for the life of your mortage.  Check out the post to see how you might be able to save.

Electricity – $276 Our electric bill covers both our home and our Airbnb rental.  We haven’t been using our central heat this year, just our wood stove and/or bundling up.  Thankfully it doesn’t get too terribly cold here.  The rental, on the other hand, has electric heat which is used whenever our Airbnb is booked, which was nearly all the time, until the beginning of April.

Car Insurance – $165 This covers our two minivans.  We’re really not driving much, so we took one van off insurance and de-registered it with the DMV until we get back to a normal schedule where we might need two cars again. We have been so impressed with the service and coverage that USAA provides as both a bank and an insurance company. We’re able to join USAA because my father-in-law was in the service years ago.  If you, your parent, or your spouse were/are in the military, you’re probably eligible for USAA too!

Internet – $71 Now that Mike is working from home and we have three kids schooling from home, we decided to upgrade to a little faster internet.

Water – $100 Our water rate keeps increasing and our growing garden will mean growing water use as well.  I try to estimate what half of the bill will be and set it aside as the bill only comes every other month.

Trash – $37 Our garbage collection bill comes every other month, so we set aside half each month.

Cell Phones – $47 This includes one Republic Wireless phone and one new phone using through Visible. We’ve had a Republic Wireless plan for many years. It offers a unlimited calls and texts and 1 GB of cell data for $20/month with no contract.  The nice thing about Republic Wireless is that any time you’re in wifi range, the phone uses wifi for both calls and data, so we rarely get close to the 1GB data limit.

We live in kind of a funny spot where Republic Wireless cell service isn’t available. That might sound crazy, but since they use wifi for calls when it’s available, it has never been a problem.  Until last year when PG&E started turning off our power for days at a time when fire danger is high.  Without electricity we have no wifi, which means we can’t call or text either.  Not the kind of situation you want in a potential fire!  So we found a great affordable carrier that does get service where we live.  It’s called Visible and it has both wifi calling and unlimited cell data (on the Verizon 4G LTE network), all for $25 a month!  We decided to try it out.  So far we’re pleased with it! The power even went out twice this week (unplanned outages that only lasted a few hours), and it was handy to have contact with the outside world during that time.

Another great option for affordable cell phones is Mint Mobile, especially if you want to bring your own phone.  I’ve had readers rave about their great service.  You can get data for a lot less than Republic Wireless.  Mint Mobile or Visible both look like they’re worth looking into if you want a cheaper cell phone bill!

Home phone – $5 Since Mike works at home a day or two each week, we have a home phone for him to use. It’s also handy for the older kids to be able to call us when they are babysitting at home.  It’s through Ooma, which is internet-based, not a traditional land line.  The monthly bill is a minimal $4.50 and the initial set-up (hardware, etc) was under $100.  If you want to give Ooma a try, that link should also get you a $20 credit (let me know if it’s not working).

Orthodontist – $61 Since our oldest gets her braces adjusted every other month, we’re treating this as a monthly bill rather than paying it all up front.  These payments will last for the two years that she has braces.

Disability Insurance- $151 We have been talking about getting disability insurance for Mike for years, but we finally did it in February.

Piano – $110 Our oldest started taking piano lessons from a teacher who isn’t me and it’s going really well.  The last two months she’s had socially distant lessons via Zoom.

Everyday Expenses

Food – $162 At the beginning of the month, I realized that the yeast, baking soda, baking powder, and cocoa powder we had in our food storage were not going to be enough for our Quarantine Food Storage Challenge.  Well, they would last us a while but the thought of having to ration them was stressing me out so I placed a $90 order to buy 5-10 lbs of each of them.  I also order some canola oil and shortening since we only had 5-6 lb of butter in the freezer.

Fuel – $0 ZERO!  I don’t think we’ve ever spent zero on gas for a month in the past 15 years of marriage, except for when we lived in Guatemala, but then we had to pay for public transportation!

Houshold Misc – $154 We ordered some hand soap, dish soap, and other cleaners from Grove Collaborative.  I got some seeds and sweet potato slips from ebay, along with some pony packs to plant them in.  We also got some random things like diaper cream, couch throw pillow forms (to make covers for), hand quilting thread, and kids’ toothpaste.

Clothing – $79 I bought a couple of orders from the Children’s Place.  We get a lot of kids clothes from the thrift store, but the Children’s Place is probably my favorite place to get new clothes.  Their prices are great (especially sale/clearance prices) and they have free shipping an all orders everyday!

Animals – $104 We bought 10 bags of chicken feed.  It was on sale for about $2 off per bag, so it was a great time to stock up.

Kids’ Activities/School – $0 Not only did we not spend anything in this category, we also got a refund for swim team that we paid for a few months ago. Sadly, swim team was cancelled due to COVID-19.  I put the refund into the Family Fun Fund, as you’ll see below.

Allowances – $60 We give our kids “practice money” as a weekly allowance.  You can read all about why we decided to pay our kids allowance that’s NOT tied to chores, as well as all the details of when and how much in this blog post.

Sinking Funds

For most of our budget categories, we zero out what is left at the end of the month and send it to our mortgage payoff goal, but in our sinking funds we set aside money each month for future expenses and let it build up until we need it.

The amount in bold is the amount we added to the fund this month. Any spending is noted in the comments along with the current balance of each fund.

We do not have separate bank accounts for these funds.  All of the money sits in our checking account.  I’m not worried about getting the money mixed up because we spend according to our budget category balances, not our checking account balance.  We seriously never even look at our checking balance unless we’re reconciling the account.  We track our budget categories and spending in YNAB.

Medical/Dental – $400 We didn’t do any spending from this category during April.  Current category balance is $2,862.

Car Maintenance – $300 We didn’t spend anything on car repair or maintenance this month, which isn’t surprising since we only drove a handful of times. Current category balance is $3,284.

Christmas – $100 We didn’t do any Christmas spending in April. Current category balance is $312.

Life Insurance – $75 Our premiums aren’t due until November, but if we put aside $75 per month we should have them covered. Current category balance is $450.

Birthdays & Gifts – $40 We didn’t spend anything here in April.  Current category balance is $188. 

Car Registration & Smog – $40 We didn’t spend anything here.  Current category balance is $497.

Family Fun Fund – $0 Remember a few months ago when we paid $775 for our three oldest kids to do swim team this summer?  Well, that was cancelled so we got a full refund.  Maybe next year we’ll try again. 😞 The kids are super disappointed. Current category balance is $792.

Car Fund – $600 – We have a new sinking fund to save up to buy a used Prius for Mike to commute in.  We’re planning to have $10,000 saved by the end of the year.  He’s been driving our second van (the one we were going to sell after we bought our 8-seater) ever since his car was totaled by a deer, though for the last 8 weeks or so he hasn’t been driving anything!! Current category balance is $5,182.

Preparedness – $300 This is a new category that I’m going to use to restock our long term food storage when we finish our Quarantine Food Storage Challenge.  This month I spent $189 stocking up on canning supplies like flat lids (I got 30 dozen!) and 25 lbs of pectin (way cheaper than buying it in the little 4-ounce boxes).

Investing

Kids’ 529s – $125 I know that $25 per kid per month invested for college isn’t much, but we’re not as concerned about college costs as some people.  Scholarships, grants, loans, and jobs during school worked for us.  We may accelerate this savings later, but it’s not our highest priority right now. You can read about our decision to start saving a little for college in this post.

IRA (Steph) – $500 $500 monthly will max out my $6,000 IRA contribution for 2020.  Mike has about $700 each month deducted directly from his paycheck into a pension fund.

Mortgage Payoff Goal Progress

Our big financial goal right now is paying off our mortgage.  The original goal was to pay it off in 5 years. It looks kind of impossible on paper right now, but we’re hoping to figure out how to still make it happen! We’ve made some adjustments to our priorities that we’ll be sharing soon, so if we don’t make it exactly in our five-year time frame, we’ll be ok with that too. You can read about our mortgage-payoff goal here and see the numbers for our most recent refi here.

In addition to the $1,462 of our normal payment that went toward principal, we also had $3,000 in additional principal.  We have a lot more sitting in the “Mortgage Extra” cateogry of the budget, but we’ve decided to just keep it available there and put a hold on paying extra on our mortgage while we wait out these uncertain times.  We just wanted to pay that $3,000 to get the balance below $300K!

That brings our totals to:

Current balance (after April 2020 payments): $299,630

For reference:

Original balance of 15-year mortgage: $372,700
Balance at start of 5-year goal (Nov 2018): $363,171

Percent of 5-year goal reached: 17.5%
Percent of 5-year time elapsed (18 mo): 30%.  Yep, we’re behind!

The 6-month goal we set for Day 1 of the Frugal Fresh Start Challenge is to put an additional $25,000 toward our mortgage by June 30th (this is above our normal monthly mortgage payments).  So far we have put $8,216 toward that goal. We also have another $9,890 waiting in our checking account that will go toward the mortgage once some of the current economic uncertainty is abated and we feel comfortable actually making the payment.

You can get this hand-drawn brick house printable progress chart here.  I love that it has LOTS of spaces (365 in total) so that we can color it in often and celebrate our progress!  It would work great for paying off your mortgage OR saving for a down payment.

Whew!  That was a lot of numbers.  Thanks for reading our personal finances made public!

If you haven’t already done so, take a sec and report your Debt Smashing progress for April (even if it’s zero)!

How About You?

• How did your budget and/or debt repayment go in April?
• How has the pandemic affected your financial goals for good or for bad?

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