Money talk without the taboo. Here’s our family’s real budget from last month.

Where did you learn how to budget? Did your parents teach you? Did you learn in school? Of all of the really impactful things you could learn in high school, I think money management is near the top.

Yet most people don’t learn about personal finance in high school. I know I didn’t!

The informal surveying I’ve done shows that most people have to figure out money on their own in what often turns out to be the school of hard knocks.

Because talking about money is so taboo, even in families, many people have never seen a real, working budget besides their own. But talking about personal finance shouldn’t be taboo! In fact, talking about budgeting is a great way to learn how to budget.

This is why I continue to transparently share our family’s real budget.

Of course, our budget will look different than yours, but that’s normal. Our numbers looked much different when we were in the process of paying off six figures of student loan debt. Everyone has different needs, values, and priorities, so it only makes sense that everyone spends money differently too.

The good news is that you can apply the same budgeting strategies to your own finances even though our numbers and categories are different than yours.

Okay! Let’s just jump into the numbers for November 2023!

Spending in November

When we first understood the concept of living on last month’s income, it rocked our financial world in the best kind of way. If you don’t know what I’m talking about, this video will tell you all about living on last month’s income  and how life-changing it is. Or you can read this article on how you can get started.

At the beginning of each month, we start budgeting by first adding up the income we earned the month before. In November, we budget and spend what we earned in October. We know on November 1st exactly how much money we have to work with during the month.  So on November 1st, we start the November budget by taking everything we earned in October and assigning it to our November budget categories.

We can’t see the future, so on the first of November, these dollar assignments were really just best guesses and goals. We’ve been doing this for years, so we have a lot of history we can rely on, but every month is different.  Our dollar assignments at the beginning of the month almost never stay exactly the same because our needs and priorities often change during a month.

It’s normal for our spending plan to change during the month. The important thing isn’t spending exactly how much we had guessed at the beginning of the month. It would be silly to let our November 1st guesses dictate what we can and can’t do all during the month. The important thing is to not spend more total in November than we earned in October.

If we need to spend more in one budget category than we had originally assigned, that money has to come from some other budget category. We revise the budget categories to meet our priorities during the month, but we can’t just add more money to all of them, because the total amount stays the same all month long. A changed budget is not a failed budget. A budget needs to be flexible in order to be successful!

Here’s our family’s final November spending for all of our budget categories.

Giving

Tithing – $2,951 We start out the month paying a 10% tithe on our income. Like all of our November spending, our tithing comes from what we earned in the month before. If this is your first time, here, your should know that in October our income was nearly triple what it normally is. You can see October’s Budget Update here. We often get questions about this. You can read our thoughts on tithing here.

Fast Offering – $100 Each month we take one day to go without food and drink (fasting) and contribute to a program that helps people who need it.

Monthly Bills

Mortgage – $2,823  We have a 15-year mortgage on our 2200 sq ft house in Northern California. We’re so thankful to have locked in our mortgage interest rate at 2.375% when we refinanced in December of 2020 (all of the details and numbers are here.) We currently have $180 K remaining on our mortgage.

Electricity – $0 Our electric bill now is usually just an unavoidable $6 service fee, but every year the California Public Utilities Commission declares a small ratepayer refund based on the sale of carbon credits. That means this month our entire bill was $0. Last year we installed solar panels on our property, a $70,000 investment that we just finished paying for with our extra-high October income. For part of the year we produce more than we use, so we will also have some credit toward our bills in the winter when we won’t produce as much because of the shorter days.

Car Insurance – $209 Our car insurance went up significantly when we got a 15-passenger van so we could drive ourselves (8) and our Ukrainian refugee family (4) together in one vehicle. See this post for details. It’s not just the new vehicle, though. With 12 people in the household, each with their own appointments and activities, we’re also driving a lot more miles and more miles means higher auto insurance premiums.

Internet – $70 We have cable internet through Comcast. When we bought our home six years ago, we invested $5,000 into getting cable internet brought to our property. It has been well worth it every single day since then.

Water – $233 Our water bill comes every other month, but in October we didn’t set aside half like we normally do so we had to pay the full amount in November.

Garbage- $47 Like the water bill, our trash pick-up bill comes every other month, so each month I set aside the money for half of the bill.

Cell Phones – $187 We pay for seven cell phones: four for our family, and three for the Ukrainian family that we sponsor. They are all through Visible. Visible is a Verizon subsidiary that offers no-contract plans with wifi calling, unlimited cell calls, and unlimited data on the Verizon network. We’ve been using them for years. You can’t beat paying just $25 per phone each month with unlimited data.

Music – $0 Our music teacher generously offered his time and talent to teach our 11-year-old Ukrainian girl free of charge. What a blessing!

Everyday Expenses

Food – $768  Our grocery spending is normally just for our family of 8 (the Ukrainian family buys groceries with food stamps), but in November all 12 of us took a trip for Thanksgiving week. Although we brought most of our snacks and food with us, food costs were higher because we also got pizza and other treats for the 12 of us on the trip.

If you need help getting your grocery spending under control, you can learn all about my strategies and method in my Grocery Budget Hero online course. Get $20 off with the coupon code STARTNOW.  That puts your total cost at $59. I promise you’ll earn that back many times as you build your grocery budget hero skills.

Fuel – $1,329 We drove our 15-passenger van to Arizona and back over the Thanksgiving holiday. Since we normally spend right around $1,000 on gas, I was pleasantly surprised by November’s fuel total. It helps that gas is cheaper everywhere than it is in California.

Household Misc – $554  This is definitely on the high side. Normally this category covers normal household expenses that aren’t food and don’t have their own category, like toiletries, cleaning products, home office supplies, etc. In November, we spent $125 in two trips to the dump to dispose of an old fridge, our hot tub (Mike cut it into pieces with an angle grinder in order to get rid of it), a broken, TV and a few other small things. We have two new drivers, so we definitely needed these car magnets. I also put the cost of our daughter’s driving permit in this category. We like streaming music and audio books in the car (instead of the radio), so we got this FM transmitter before our road trip. We also paid for cloud storage, toner for the printer, and other truly miscellaneous household expenses.

Clothing – $283 – Even though I give the kids lots of clothes for Christmas, I often still categorize it under clothing for budget purposes. I buy a lot of clothes throughout the year when I find great deals, but I still get some final pieces during the holidays. In addition to needed clothing purchases, we also had a mishap on our trip that required us to order new running shoes on Amazon. On the way home from our Arizona trip, my son would be running at the state cross country meet, but a couple of hours into the trip, he realized that he had completely forgotten his running shoes. He had the slides he was wearing, dress shoes for church, and his racing flats, but nothing to train in during the week or to warm up in at the meet. Thank goodness for Amazon! Finding a size 17 running shoe in person would have been a great way to waste precious vacation time.

Animals – $766 We normally spend about $100 on animal food for our chickens, ducks, cats, and dogs. In November we also spent $600 to get a huge tumor removed from our dog’s head.

Allowances – $84 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 directly tied to chores, as well as all the details of when and how much in this blog post.

Sports – $124 We paid $72 for all of us to attend the California high school state cross country meet. We wouldn’t have normally brought everyone to such an event (I don’t think our Ukrainian friends watched any of it), but since we were on our way back from Arizona and still three or four hours from home, everyone had to tag along and we had to pay per person. Also in November, we spent $52 to purchase soda to donate to our daughter’s basketball team concession stand at the beginning of the season.

Refugees Misc – $89 I decided to have a separate category for the expenses for our refugees that aren’t covered in other categories. We spent $40 on bus transportation for the Ukrainian mom to attend her daily English classes. We also paid for a Russian version of the online drivers training course so that the 16-year-old boy can eventually get his permit ( though we’ll wait for his mom to get her license first).

Kids Misc – $370 We paid for 6 hours of behind-the-wheel drivers training for our oldest. In California, you must have at least 2 hours of behind-the-wheel training with an instructor before your learner’s permit is valid. In total you need 6 hours of driving with an instructor (and many more with another adult licensed driver) before getting your license.

Sinking Funds

For our normal budget categories above, we take out any funds that are still left at the end of the month and send them toward our big financial goal. For example, if we started the month with $600 in our groceries budget category, but only used $520 of that, the other $80 would go toward our current major financial goal–right now, paying off our solar panels.

In contrast to the regular budget categories described above that we zero out each month, we also put money into the categories below. These are our sinking funds. Our sinking funds are categories where we set aside money for periodic expenses each month and let it roll over and build up until we need it.

The amount in bold is the amount we added to the fund this month, followed by spending notes and the current balance of each fund.

To answer a question we often get, we do not have separate bank accounts for these funds. We had separate accounts many years ago when we first started budgeting but we learned that was overkill. Instead, all of the money sits in our checking account. Since we spend according to our budget category balances, not our checking account balance, we’re not worried about getting the money mixed up. We seriously never even look at our checking account balance unless we’re reconciling the account. We track our budget categories and spending in YNAB, a budgeting tool we absolutely adore. Yes, you can adore a budgeting tool. Don’t believe me? Try it out. If you have been using Mint or something similar to manage your finances, you’ll want to read about our switch to budgeting with YNAB.

In November, we added more than normal to some of these categories because we didn’t add to most of them in October.

Medical/Dental – $300 added. We spent $530 at the dentist in November. Current category balance is $1,269. 

Car Maintenance – $600  added.  In November we spend about $400 for two tires on our big van and another $400 on two tires for another van. On our trip to Arizona, one of those brand new tires had a complete blowout which was not covered under warranty, so we paid for yet another tire. Current category balance is $598.

Christmas – $300 added. We spent $420 on Christmas 2023 which includes $200 for a new pre-lit artificial tree. We kind of miss the live tree this year, but not the mess it makes. Current category balance is $1,407.

Disability Insurance- $380 added We normally put $190 aside each month for disability insurance so that when the annual premium is due we have the money ready, but we didn’t in October so we set aside double in November. If Mike is unable to do his work as an attorney due to illness or injury, this disability insurance will replace about 2/3 of his current income. Since our income potential is our greatest financial asset right now, we want to have disability insurance to help us protect it. Current category balance is $1,547.

Life Insurance – $200 added. As with the disability insurance, we paid double this month since we skipped it last month. Our life insurance premiums were paid in November, leaving a small remainder which will go toward next year’s premium. Current category balance is $73.

Birthdays & Gifts – $50 added. We spent $15 in November for birthdays.  Current category balance is $79. 

Car Registration & Smog – $40 added. We spend $153 on registration in November. Current category balance is $47.

Family Fun Fund – $1,500 added. We spent $1,446 in November on both current fun (motels on our Thanksgiving trip) and deposits on future family adventures. Current category balance is $78.

Home and Garden – $70 added. We spent $69 to put a new door handle and lock on the garage door. Current category balance is $1.

2025 Trip – $500 added. We have top secret plans for a family adventure in 2025, so we made a separate budget category for it. We’re aiming to add $500 each month either through our normal budget or other means. (I’ll show you what I mean in December’s update). Current category balance is $500.

Investing

Kids’ 529s – $150 added. Investing just $25 per child per month for college isn’t much, but we are okay with that. Neither of us had much college savings when we went to college, but with scholarships, grants, loans, and jobs during school we were able to get our undergraduate degrees without debt. We may contribute more later, but right now we’re happy with small, consistent contributions.  I looked at the balances recently and was please to see that this small contribution that is barely noticeable in our monthly budget has added up to over $15,000! If you want to know more you can read about how we decided to start 529s for our kids.

IRA (Steph) – $542 added. With this same amount each month, I will reach my $6,500 IRA contribution for 2023.  Mike has about $1,300 each month deducted directly from his paycheck into the state pension fund for his retirement.

Goal Progress

We finished paying for the remaining $12,695 of our solar installation in November!

If you are thinking about getting solar or are just curious, you can read about why we got solar, how much it cost us, and how we’re paying for it.

Our total cost for getting solar was $70,000. We paid about $2,704 of interest on the $50,000 loan we took out to cover the majority of the cost.

I made a chart to keep track of our progress. I color in a little square for each $250 we put toward our solar purchase.

Income Earned in November- $10,221

Above you can see everything we spent in November (that we had earned and received in October.) At the same time we were spending what we earned in October, we were also (of course) earning money during November. At the beginning of December, we set up our budget to allocate spending from our November income.

This concept of getting a month ahead, has made such a huge impact on our finances! It takes some work to get to the point where you are living on last month’s income, but the effort is completely worth it!

The income section below shows the money we earned in November, which we didn’t touch until December.

Attorney Income – $10,221 Mike works as an attorney for the state of California. This is his take-home pay after taxes, social security, his pension contribution, and health insurance premiums.

Rental Income – $0 For years we rented out a one-bedroom apartment on our property through Airbnb. We gave that up to take in a Ukrainian refugee family for a couple of years. We loved Airbnb and will likely go back to that in the future. If you’re thinking about renting out your space on Airbnb, check out Mike’s post about dealing with insurance for your Airbnb rental or our explanation of how we handle our Airbnb finances.

Law Firm- $0  Before working for the state, Mike did estate planning and business transactional work. Over the last few years he has had a steady stream of potential clients, most of whom he refers to other attorneys, but he still occasionally helps former clients. He doesn’t cut himself a paycheck each month, just a couple of times a year.  He took a big income disbursement in October for a case that he had been working on for years.

Blog – $0  I only pay myself a couple times a year now. My blogging income took a major hit when I put the blog on the back burner during Covid to start homeschooling my kids. It is slowly recovering as I put more effort into posting regularly and all of the things I do behind the scenes. Thankfully the income still covers my fixed blogging expenses (which are a lot more than most people would guess) and allows me to pay myself a few times a year.

Come back soon to see how we use this income to fund December’s budget.

How’s Your Budget Working for YOU!?

That was a lot of words and numbers! Congratulations for making it all the way through our November 2023 family budget update!

Now we would love to hear from you!

Any questions on what or why we spend what we do?

What are your current financial goals?

Do you find that your budget is helping you reach your goals, or is it not working like you wish it was?

Let’s chat in the comments!

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