Even though we’re done paying off our debt, we’re still keeping up with sharing our family’s real budget with real numbers and lots of detail. It helps keep us accountable and on track as we tackle our next goals. And since topics like income and budgeting can be pretty taboo, we like to break the silence and get people talking about money.
We’ve been crunching budget numbers all month long, as we try to form our future budget and decide what a comfortable mortgage payment would be. As tempting as it would be to buy a house for the amount we’ve been approved for, we know that wouldn’t be smart, as it would mean a monthly payment with almost no wiggle room in the budget.
The temptation is real though. We were kind of close to scrapping our pre-house savings goals this month in favor of buying a house that we really liked. We still may change the use for some of our pre-house goal funds, but we decided not to put an offer on the house. It would have made the budget tight for each of the next 360 months, which is not what we want for the long haul.
Another reason I’m glad we didn’t jump into that house is that we will need to replace our van in November. Going up some steep hills (we have lots of those around here), it started sounding like a motorcycle. (Seriously! My kids really thought that there must have been a motorcycle on our tail.)
We’re not sure what it is (something about the lower gear and the strain of going up a steep hill), but it happened twice and sounded pretty scary. We know the van won’t pass smog in May when it is due because the dashboard indicators (speedometer, odometer, gas gauge, etc) haven’t worked for ages. So it’s not worth putting money into since we know we’ll be getting a new one soon anyway.
Savings Goal
We’ve been focusing on some “pre-house” goals before we really start saving for a down payment, though, if the right property for the right price came up we could modify our timing on some those goals. Our pre-house goals address things we’ve ignored while on our crazy-focused debt payoff adventure, like saving for vehicle replacements, putting money toward retirement and taking advantage of tax-reduction strategies (more on that here).
You can read about our pre-house goals in detail here.
This month we put an additional $4,246 into our pre-house goal fund, which brings our total to $18,020, or almost 55% percent of our goal. We had hoped to finish this goal be the end of the year, which means we only have two months left. It’s kind of a long shot, but we’re still working hard toward it.
By next month, we will have used some of this for a new van. Thankfully $10,000 of our total pre-house goal amount is ear-marked for vehicle replacement. In reality, I don’t want to go that high, as my husband’s car, now at 253,000 miles on the odometer, will also need to be replaced at some point in the near future.
Income
Our total net income for October was $11,671. Since we live on last month’s income, this is income that we haven’t used yet. We will be budgeting and spending it in November.
Attorney Income (Day Job)– $5,300 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 $4,121, 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 I can show them to you in our budget below. You’ll notice that this is up from previous months thanks to a 5% pay increase now that he has passed the one-year mark at this job.
Attorney Income (Private Practice)– $4,255– On top of working full-time (and a three-hour round-trip commute), my husband has his own private law practice on the side. He started it last year to help speed up our debt payoff. His income fluctuates greatly (last month he didn’t pay himself at all).
My Income (Blog)– $2,116 The income that I report is the income that I received this month minus all of my blogging expenses. Well, all of my expenses except taxes. We will deal with that one later.
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. If you want to start your own money-making blog, check out my complete step-by-step instructions for setting up a self-hosted blog.
Spending
Each month we budget down to zero using last month’s income. When we started doing this, it literally changed our lives. In a big way. 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 October came from the income we earned in September. In addition to the savings goal above, here’s how we spent money in October:
Tithing– $728 We happily pay a 10% tithe on our total income from the previous month. You can read more about why we paid tithing even when we were in debt.
Other Giving– $80 Other charitable donations this month.
Mortgage/Rent– $0 Living in my in-laws’ unfinished basement is a huge blessing. I don’t expect everyone to do what we do, but for us, it’s worth sacrificing some comforts and privacy to make headway on our financial goals. If you are considering living with family, here are some things to consider.
Internet– $0 Thanks to some legal work that my husband did for our service provider, we will have free internet for a while. It’s nice to stretch our budget by bartering, though we will still need to pay income tax on the fair market value of Internet service at tax time next year.
Republic Wireless Cell Phones– $23 We’ve been using Republic Wireless as our cell phone carrier for over two years now. This covers the cost of service for both our phones, including all taxes and fees. If your cell phone bill is killing you, I definitely recommend that you check them out!
Health Insurance– $513 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. This just came down over $200 after he hit the one-year mark at his job, which we’re pretty excited about!
Car Insurance– $107 We insure two older vehicles (both 1997). 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 husband’s father was in the service years ago. If you or your parents were in the military, you’re probably eligible for USAA too!
Renters Insurance– $14 Our renters insurance is also through USAA. It doesn’t cost much and it’s really great to have when you need it, like when my husband’s car was broken into a couple of years ago. Car insurance covered the car damage and vehicle related items, but it was our renters insurance that covered his personal property.
Food– $300 We had a typical food month. You can read about what a month of groceries looks like and why I don’t share all the details. We celebrated a birthday this month, but just had a small family gathering instead of a big party. We also didn’t eat out at all this month. Well I’m thinking that between the food we were given recently and our full chest freezer, that we will try to have a minimal grocery month in November.
If you are struggling to get your grocery budget down, check out the Grocery Budget Makeover.
Gas– $364 My husband commutes an hour and a half to work, so that is the bulk of our gas expense, though we also live in the boonies, so we are 45 minutes away from anything (stores, library, church, etc). Considering our housing costs, the high gas costs are well-worth it.
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– $19 I found some awesome clearance summer clothes for my kids next year! Buying clothes ahead and off season is just one of the ways we get kids clothes cheap or free.
Household– $65 In addition to the normal toiletries, I bought the ingredients to make more of my homemade laundry detergent. I also bought (what is hopefully) our last package of disposable diapers. We just use them at night and use cloth diapers during the day. We bought an inexpensive potty seat (because this beauty is packed away somewhere). Our three older kids were potty trained by age 2, but it looks like our 18-month-old, may be our earliest potty trainee! Not only does potty training early save money, but I think it’s easier before they hit the “stubborn” stage and it’s nice to be done changing diapers.
Entertainment– $1 We watched a VidAngel movie one night. I wrote more about why we love VidAngel here.
Kids’ Activities– $10 As a prize for keeping their room clean for a month, the kids each earned a hot lunch at school. They still haven’t used it yet (they’re waiting for their favorite meals), but we put the money into their school lunch account.
Car Repair– $15 We bought oil for the car. My husband’s car has leaked oil ever since the he hit a bear a few years ago, but adding oil every two weeks for the expected remaining life of the car is much cheaper than having the leak repaired. It’s a leak that is difficult to get to, so it would require lots of labor time, with a corresponding high cost.
Medical– $0 We were all healthy this month. We feel very blessed to not have much expense when it comes to medical issues. My heart goes out to those of you facing big financial hardships from medical expenses.
Gifts– $28 We bought a gift for another family.
Christmas– $100 We set aside $100 for Christmas, though we only spent $50 of it. We are planning on taking a post-Christmas family trip (I’ll tell you more about our plans soon) and will be staying at an Airbnb for a couple of nights. The $50 was for the cleaning fee deposit. You can grab a coupon for $35 off your first Airbnb stay (and just save it for when you’re ready to travel).
Retirement– $484 With my husband’s state job, this amount comes directly out of his paycheck and into his state retirement fund. While we have some retirement savings from before law school, we hadn’t contributed for several years while in school and paying off student loans. It’s nice to see our retirement funds growing again.
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.
Well there you have it! Our personal finances made public!
Your budget probably looks completely different and that’s just fine! I don’t post these details for the sake of comparison. You can read how I feel about that here.
I hope you are making strides toward your goals. If you are just starting out on your journey to pay off debt, check out my Smash Debt Quick-Start Guide to help you get organized and make a plan to pay off your debt.
How About You?
- I’d love to hear about how your budget and/or debt repayment went in October!
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We finally got our new roof, and finally got the check from insurance, which goes right back out to the roofer. Our out of pocket might be $1000-1500 when all is said and done, so we are ecstatic . This means we aren’t shunting Roth funds to a new roof. I hope we never have another insurance claim in our lives, however, because that was a painful process.
October ended on a rocky note last month. We just barely made it under budget, I’m talking 0.00 made it. However, we’re hoping to get things together this month with a pantry challenge!
We are hoping to get rid of the diapers this month, too. Woohoo!
Good luck with the potty training Sarah! 😉
So happy to hear someone else’s old car has leak issues. We keep holding onto to my husband’s 1997 Nissan whose odometer doesn’t work because it’s cheaper than getting a new car. To fix its leaks, it would be well over $1,700…more than the thing is worth. But, if it came to it, it would still be cheaper fixing it than buying a whole new (even used!) car for us right now. *Praying it makes it at least another year!* We save for potential car repairs because it’s so old though.
You’re definitely not alone! We’re hoping my husband’s car hold out a little longer. Paying for car repairs is always a potantial expense with old cars. Good luck with your Nissan!
I bet you can’t wait to get into your own house! Good luck replacing the van – I hope this is the end of your bad run of cars.
In October my husband and I sat down and set 1, 2, 5, and 10 year financial goals. It’s nice to see the “big picture” of where we want to be. We don’t budget because we don’t see the need. We don’t have any debt, we have a comfortable and steady income, we enjoy life but we’re both just naturally savers and tend to save about half of our average-size take home pay without it being a hardship or difficulty. So, the goals we’ve set are ambitious, but attainable. We set 3 12-month goals and were even able to meet one of them (saving up some money so that we could invest a set amount of money by the end of the year) by the end of the month. Next up: save up for the kitchen remodel.
Oh Becca! We are so excited about getting a house, even though we don’t know exactly when it will happen.
That’s great that you’re both naturally savers. Great job on the goal setting!– and accomplishing! That’s impressive! And a kitchen remodel sounds exciting!
I’m curious about whether you have changed any of your thoughts about getting a new van? My husband and I are in the camp of buy new and keep it for a very, very long time. 🙂 I think it’s partly because car issues stress me out so much, and it’s worth a possible premium to feel like my car is going to get me safely where I need to go. But I can also see not wanting to do that right now as you are working so hard to get into your new home! So I can’t even say in my own mind what I think you should do! (Please know that it is not that I think it matters what I think you should do, but just saying what I was thinking as I read this.)
I don’t think we would ever get anything brand new, but hopefully we’ll find something a little newer (both in model and mileage) this time. I don’t want to spend tons (or have a car payment) since getting a house is a much bigger priority :).