Family Budget Update– November 2017

After last month’s good income you might expect that we made some headway on our big goals like bulking up our emergency fund.

But we didn’t.

We managed to squeak out the $300 that we needed to get our emergency fund over the $10,000 mark that we fell short of last month.

We had some unexpected espensive car repairs and dental work, but our spending went far beyond those not-so-fun things.  In fact, you might be surprised where the money went, especially if you know me in real life!

As you look at our income and expenses in November, keep in mind that they don’t go together.  Our spending in November is based on last month’s (October’s) income, which was significantly higher than this month’s.  November’s income (as listed below) won’t be used until December.

Here are the numbers, raw and real!

Income

Our total income for November was $8,552. Since we live on last month’s income, this is money that we’re waiting to spend in December.

Attorney Income (Day Job)– $6,215 Mr. SixFiguresUnder has been working full-time as an attorney for the state of California since the fall of 2015.  His actual take-home pay was $5,021 but I add back in the cost of the benefits (insurance, dental, vision, parking, union dues and retirement) that are automatically taken out of his check so that you can see what happens to the money that never makes it home.

Attorney Income (Private Practice)– $0  On top of working full-time, my husband has a part-time private law practice on the side.  He started it to help speed up our debt payoff and because he had clients from his days at a small firm that didn’t want to let him go.  This income fluctuates greatly from month to month.  Between a natural lull and a new baby, he didn’t spend a lot of time on this private work in the past couple of months.

My Income (Blog)– $2,337 The income that I report is the income that I received this month minus all of my blogging expenses.  Of this, I set 30% ($701) aside for self-employment taxes (which currently covers the estimated quarterly payments for both of our businesses) and the remainder ($1,636) goes into the family budget.

If you’re interested in the details of my blogging income and expenses as well as other blogging tips and resources, you can sign up for my Behind-the-Scenes Blogging emails to get the scoop.

Spending

Each month we budget down to zero using last month’s income.  When we started doing this, it literally changed our lives!  For more about how living on last month’s income works and how you can get started, check out my free Guide to Getting a Month Ahead Financially.

Our spending in November came from the income we earned in October.  Here’s how we spent money in November.

Tithing– $1,174— We happily pay a 10% tithe on our total income from the previous month (October).  You can read more about why we paid tithing, even when we were in debt.

Other Giving– $95– Other charitable donations this month.

Mortgage/Rent– $2,500 Our actual mortgage is just under $2,500, but I like paying a little over to make a nice even number.  Last month we started paying an extra $200 on top of this but decided not to continue that right now since we still have some other priorities that come before working to pay off the mortgage.

Curious about our mortgage?  You can read more about why we got a conventional mortgage instead of FHA or USDA and then why we didn’t wait for a 20% down payment.

Electricity– $162 We are glad to be into the cheaper non-summer months.  Our house is completely electric (no gas or propane). Keep in mind that our electric bill covers the small rental we have on our property as well (the rental uses propane for heat).

We have been really motivated by the OhmConnect program which lets you earn extra money for saving power. My kids think it’s super fun to save power now.  If you’re in California, Toronto or Texas, you should definitely check it out!

Water– $47 Our water bill comes every other month, so I just set aside approximately half of what I expect the bill to be (or what it is).

Trash– $32 Our bill for trash service comes every other month, so I set aside half of the bill each month.  We’re currently paying for curbside pickup, but that’s not the only way to do it.  If you’re trying to cut every expense to its bare minimum, here are some ideas to save on trash service.

Internet– $50  After surviving so long without internet, I’m thrilled to be paying an internet bill (and a nice low one too)!  It’s been months now, and we’re still oozing with gratitude to have internet access in our very own home.  We won’t quickly forget what it’s like to go without it.

Home Phone- $4  Since my husband works at home a day or two each week, we decided to get a home phone for him to use.  It’s Ooma, which is internet-based, not a traditional land line.  The monthly service is minimal and the set-up (hardware, etc) was under $100 (and my link will get you a $20 Amazon gift card on top of it!).

Republic Wireless Cell Phones– $13  We’ve been using Republic Wireless as our cell phone carrier for over three years now.  This covers the cost of service for my phone, including all taxes and fees (we’re on the Republic Refund plan).  My husband also has a Republic phone which he uses for his private practice, but that’s a business expense, not a family budget expense.  If your cell phone bill is killing you, I definitely recommend that you check them out!

Health Insurance– $408 We have insurance through my husband’s employer.  This is the portion of the insurance premium that his employer does not cover.  It includes health, dental and vision insurance premiums and comes straight out of his paycheck.

Car Insurance– $140  Our auto insurance at USAA is fabulous!  In addition to the wonderful coverage, they also give us dividends at the end of the year, which is always a nice treat.  We’re able to get insurance with USAA because my father-in-law was in the service years ago.  If you, your parent, or your spouse were in the military, you’re probably eligible for USAA too!

Food– $510  I planned for a high food budget this month because I spent nearly $100 on a Zaycon order of 40  pounds of ground beef (individually wrapped in 1 pound packages) which will probably last us a year!  I also stocked up on some deals that Sam’s Club had on things we use regularly.

Gas– $341 Gas prices are up in California thanks to a new road tax.  Last time I filled up it was $2.87.  Still this is over $100 cheaper than our budget when we first started working to pay off debt.  Not only are we closer to my husband’s work (his commute is around an hour each way), but he gets to work from home 1-2 days a week now!

Parking– $155 Working downtown means paying for parking.  It comes straight out of my husband’s paycheck, which means it is paid for with pre-tax dollars, a small consolation.

Clothing– $120 We bought a few basics this month, including some snow gear (gloves and snow pants) for the kids who needed them.  I actually found some great deals that made them cheaper than at the thrift store!  We were hoping to go sledding over Thanksgiving, but instead we enjoyed a warm 60 degrees (and no snow) in Tahoe, so I’m wrapping up the snow things for Christmas.

Household– $212  Our household budget was high this month.  Looking back through the transactions in this category, it’s not one big thing, but lots of smaller things.  In addition to toiletries, there’s a lot of miscellaneous household stuff.  And library fines that have accumulated a quarter at a time over the past year or so until it reached $20 (at which point you have to pay or else you can’t check out books.  We also had to pay for two kids books that were damaged by a spilled water bottle on our last car trip.

Fun– $94  We were hoping to go sledding in Tahoe so I picked up sleds at our local thrift store before our trip.  We also had a $20/day resort fee at the place we stayed over Thanksgiving.  The rest of the accommodations was covered by Airbnb credit that I had, so we only had to pay $60 for the whole stay.  I  had some of my girlfriends over for a craft night and spent about $20 on craft supplies for the Christmas crafts we did.

Kids– 40   We bought two bean bag chairs for the kids rooms as a reward for keeping their room clean for three consecutive weeks.  The boys earned the one for their room and the girls are still working on it.

Home– $2,878  We used to call this category “Home Improvement” but we’ve expanded it to be more than just your typical home improvement projects.  We had been waiting for Black Friday for a couple of big purchases for our home.  As I’ve mentioned in the past, we’ve been without a home computer for over a year now.  My husband bought the components on Black Friday so we’ll have a new desktop computer with two monitors in the office soon!

We also bought a TV, which is a very big deal for us as we have never had a television in our 12+ years of marriage.  We have always had our computer in our living room, so it doubled as a screen for watching movies (and neither of us have ever been into watching TV).  Our kids don’t know about it, so it will be a big Christmas surprise.  We aren’t planning on getting cable or satelite or even a streaming subscription.

We also joined the Arbor Day Foundation, a $15 annual membership, so that we could get “free” trees as a welcome gift (depending on the variety, you get 5 or 10).  You also get really great prices on all sorts of trees when you’re a member.  This will help us with our privacy hedge (see savings goals section)!

Animals– $66  We bought four 40lb bags of chicken feed and one 44 lb bag of cat food.

Tax Prep– $90  Our tax advice and preparation plan allows the cost to be spread over the year.

Supplemental Property Tax– $58 The property tax that is included with our mortgage doesn’t include the increase in taxes that comes from the reassessment at the sale of a property.  California property tax law is a peculiar thing and we don’t need to cover all the details, but in short, when a property changes hands, the property tax bill generally goes up.  This wasn’t a fun notice to find in the mail.  If we set aside $158 each month, we will have enough for the bill when it’s due, which means we’ll have to add an extra $100 to the fund next month.

Sinking Funds

Now that we’re done funneling every extra cent toward debt, we are using sinking funds in our budgeting.  This is money that we set aside each month into certain categories where it builds up until we need it.

Dental– $269  I had some dental work done.  Fun times!

Medical– $0 Instead of contributing to our medical fund this month we actually took most of the money out of it and moved it to car repair to cover replacing the radiator and hoses in our van.  After not getting any bills for our baby who was born three months ago, my husband looked into the insurance and found that our son’s birth was completely covered.  We left $90 in our medical account for safe-keeping, but we shouldn’t have any major bills coming (for which we are grateful).  We did spend $85 this month on a ER co-pay and several office visit co-pays.

Car Repair– $550 We moved about $800 from medical into car repair.  We also added $550 of the month’s fund that were available to budget to what was already sitting in this fund to cover the repair bill that was nearly $1,500.

Car Registration & Smog– $0 We skipped this once again this month.  Normally we put $20 in.  RIght now the fund is sitting at $140.

Christmas– $500  We put $500 toward Christmas this month and spent $549, leaving just $37 in the Christmas fund.  We have very few Christmas decorations since we have never had a very big space to decorate (or a very big budget to buy with).  Every year the local thrift store has a big event where they put out all of the Christmas decor.  I was excited to go and get some Christmas things for our house!  I can’t even explain how excited I was to start decorating for Christmas!  I think we started decorating the first week of November!

We were planning on the TV being the major Christmas present this year (waaay more than we normally spend on individual gifts for the kids), but when Black Friday came the receiver that we were going to get sold out online before we could check out, so we decided to wait on the TV for a future date (like next Black Friday).

Then I realized that meant that we wouldn’t have the main Christmas present we were planning on for our kids, so on a whim (but after some research) we bought a trampoline instead.  Then on Cyber Monday my husband found another comparable receiver, so we went ahead and got the TV after all.  The electronics are in the “Home” category, but the Trampoline is in the Christmas category.

Other Christmas presents we bought include robes, rain boots, and fancy toothbrushes for each of the kids.

Life Insurance– $70 If we put aside $70 each month, we will have our premiums set aside when they’re due.  Of all our sinking fund categories, we’ve been the most faithful at this one.  It was really nice to have the money allocated when the money was due this month!

Gifts– ($15)  While we didn’t contribute to our gifts fund this month, I did spend $15 on future non-Christmas gifts.

Retirement– $631 With my husband’s state job, this amount comes directly out of his paycheck and into his state retirement fund.

College Savings– $100  We contribute $25 per month per child to 529 accounts.  It’s not much, but it’s a start.  More on our decision to start saving for college in this post.

Savings Goals

Here’s a quick look at our current savings goals.  We’ve taken care of 2016 self-employment taxes, the cost of getting internet installed, and saving for a new (used) car.

The next goal is to beef up our our emergency fund.  We’ve set the goal amount at $25,000, so we still have a long way to go!  During November, we added just $300 to our emergency fund, which brings the total up to $10,000.

In addition to our financial goals for 2017 and beyond, we’re also saving for some larger items.  To make this list, an item must potentially cost $1,000 or more (sometimes much more).

• California King bed
• Desktop Computer
• Garage Door— Our garage door needs to be replaced (both door and motor).  The estimate is something like $2,400.
• Privacy Hedge— We want to plant some sort of hedge along the roadside of our house.  Hopefully we can get something planted in the fall/winter when temperatures are milder.

How About You?

• I’d love to hear about how your budget and/or debt repayment went in November!
• If you have any questions about how we budget, I’m happy to answer them in the comments or in a future post.