Want to see everything our family spent and earned last month? Here are all the details.

Talking about personal finance shouldn’t be taboo! That’s why we share our real budget with you every month. In fact, talking about budgeting is a great way to learn how to budget

Our budget will look different than yours, and that’s how it should be. Our needs, values, and priorities are different, so it only makes sense that we would spend money differently too.

Even though our numbers and categories are different than yours, you can apply these budgeting strategies to your own finances.

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

Spending in October

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 October, we budget and spend what we earned in September. We know on October 1st exactly how much money we have to work with during the month.  So we start the October budget by taking everything we earned in September and assigning it to our October budget categories.

We can’t see the future, so on the first of October, these dollar assignments are 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. If we need to spend more in a budget category than we had originally assigned, we know that money has to come from somewhere. We have to move over dollars that were allocated to a different category and spend less there to cover the additional spending where it’s needed.

We just can’t spend more in October than we earned in September. The most important thing to understand is that a changed budget is not a failed budget. A budget needs to be flexible in order to be successful!

Here’s our family’s actual October spending for all of our budget categories.

Giving

Tithing – $1,165 We start out the month paying a 10% tithe on our income. Like all of our October spending, our tithing comes from what we earned in the month before, in September. 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 $181K 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 are still paying for. 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 insurance premiums go up with more expected driving.

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 – $0 Our water bill comes every other month, so normally each month we set aside half of what we expect the bill to be, but things were a little tight in October so we didn’t do that. We will just pay the full bill in November instead.

Garbage- $50 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. We also pay for a Gabb watch.

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 – $565  Our grocery spending is just for our family of 8 (the Ukrainian family buys groceries with food stamps). Knowing at the beginning of the month that we had less money to spend in October (because our September income was lower), we made it a point to spend less on food by eating more from our freezer and food storage.

It’s true that food prices are higher than they were a few years ago, but I still believe almost everyone can spend a lot less than they currently do on groceries. 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 $39, and I promise you’ll earn that back many times as you build your grocery budget hero skills.

Fuel – $909 With six of our own active and involved kids to drive around and our four Ukrainian friends who also have full schedules, I spend many hours on most days on the road. I combine trips and try to do things in the most efficient way, but it still adds up!

Household Misc – $241  This covers normal household expenses that aren’t food and don’t have their own category, like toiletries, cleaning products, home office supplies, etc. A big portion of October’s household miscellaneous budget was paying for a live scan so that I can get paid a little from the state for caring for the little Ukrainian girl while her mom is at English school.

Clothing – $247 – I ordered new wrestling shoes for our oldest son and basketball shoes for our oldest daughter. Some of the kids needed some new jeans and church clothes. I have to say that I really, really like being able to shop for clothes and shoes online. Most places nowadays make returns free, which allows us to try things on and easily return what we don’t need. Our schedules are busy and the stores we would go to at are not very close. Our oldest son wears a size 16-17 shoe, which you can’t find in stores anyway.

Animals – $110 We bought several bags of animal feed for our chickens, dogs, and cats.

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 – $260 We paid $60 for the monthly fee for club wrestling.

Refugees Misc – $115 I decided to have a separate category for the expenses for our refugees that aren’t covered in other categories. We spent $60 on bus transportation for the Ukrainian mom to attend her daily English classes. I also took the family to Sam’s Club with me not realizing that they couldn’t pay with their CalFresh (food stamps) funds there, so I just covered it.

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 $300 in our household miscellaneous budget category, but only used $199 of that, the other $101 would go toward paying off our solar panels, our current major financial goal.

In contrast to the regular budget categories 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 are currently using Mint, or something similar to mange your finances, you’ll want to read about our switch to budgeting with YNAB.

Because money was tight in October, we didn’t add to most of our sinking funds.

Medical/Dental – $523 removed. We spent $0 in medical and dental, but actually took $523 out of this category to help with other expenses in October’s budget. Current category balance is $1,599. 

Car Maintenance – $0  added.  We didn’t spend anything on car maintenance in October. Current category balance is $944.

Christmas – $0 added. We spent $20 on Christmas 2023. Current category balance is $1,548.

Disability Insurance- $0 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. 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 $1,167.

Life Insurance – $0 added. Next year’s life insurance premiums will be due in November. Like the other sinking funds, we didn’t fund this category in October. Current category balance is $1,000.

Birthdays & Gifts – $0 added. We spent $0 in October for birthdays.  Current category balance is $44. 

Car Registration & Smog – $0 added. We didn’t spend anything in October. Current category balance is $160.

Family Fun Fund – $0 added. We spent $129 on some fun in October. Current category balance is $24.

Home and Garden – $47 added. We combined our “Home Projects” and “Garden” category for now. We had to replace a light fixture in October. The category balance is currently $0.

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 significant 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 are getting so close to finishing paying for our solar installation! We really hope (and expect) to finish paying it off in November.

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

Our total cost for getting solar was $70,000. We will have paid about $3,000 of interest on the $50,000 loan we took out to cover the majority of the cost. We started making payments on the $50,000 loan in April 2022. Our payments are $1,502 per month.

Our contribution to our solar goal in October was just enough to make our $1,502 payment.

Our remaining balance for solar is $12,695 and we are so excited to finish paying it off!

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 October- $28,076

As I’ll explain below, this is not a normal monthly income for us. We each have our own businesses where we don’t give ourselves regular paychecks. We paid ourselves from both of those businesses this month in anticipation for paying off our solar in November.

Above you can see everything we spent in October (that we had earned and received in September.) At the same time we were spending what we earned in September, we were also earning money during October. At the beginning of November, we set up our budget to allocate spending from our October 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 October, which we didn’t touch until November.

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- $14,355  This is mostly the payment from an estate administration case that Mike has worked on over the last two years. 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. Most of this long-awaited check will go toward finishing paying off our solar installation.

Blog – $3,500  I only pay myself a couple times a year now 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 next month to see how we use this income to fund November’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 October 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!

This post contains affiliate links for products or services that we love and recommend.