Every month during 2013, I’m keeping track of our income and expenses, down to the last penny. Last month (July) was our worst month so far. So, how’d we do in August? Much better, even though expenses are still higher than I expected.
If you haven’t seen it yet, I track all details of my financial life using my incredibly badass IM Finance Tracker Spreadsheet. What do you mean you’re still not using it? It’s pretty much the best thing ever! In all seriousness, if you’ve never tracked every penny that enters and leaves your wallet, you literally don’t know what you’re missing. Just give it a shot, even for a month or so.
And now for the numbers:
|Groceries||$175||Higher than average|
|Utilities||$109||Electricity (1067 kWh)|
|Mortgage + Escrow||$1,014|
|Internet||$15||AT&T promo rate|
|Cell Phones||$93||Two Sprint SERO plans|
|Rental House||$764||Mortgage and Escrow|
|General Merchandise||$523||Damn you Costco!|
|Life Insurance||$62||Two term policies|
|Restaurants||$7||MUCH lower than average|
|Online Services||$13||Web hosting|
|Vehicle Expenses||$88||Another car battery!|
After last month’s debacle, I was determined to spend less in August. Now that we have the numbers, what do they reveal? In some categories, we did extremely well. We spent a measly $7 dining out last month, which was just my wife having lunch with an old colleague. Seven bucks! I’ve tipped more than that for a single meal!
Groceries were slightly higher than average, mostly because we’ve pretty well axed dining out. Restaurants have lost their appeal since we had a baby last year. At ten months old, our son is guaranteed to make a royal mess of his meals, so we’re happier letting him do this at home rather than make a scene in public.
Gasoline was a little lower than average, partly because my wife is no longer working. I suspect that we’ll continue to buy 2-3 tanks of gas a month on average. Though not ideal, this is better than it used to be.
General Merchandise is where it all went to hell in a handbag. At over $500, this was more than half of our monthly discretionary spending. Looking over our receipts, this is almost entirely Costco and Amazon. What on earth did we buy? Well, we’re talking about Costco, so that means lots of delicious food in bulk, plus things like diapers and baby formula. Oh, and beer. Lots of beer. However, since we’ve instituted a household alcoholic reformation, we won’t need to buy alcohol again until at least October.
Last month, the battery in one of our cars died, so I replaced it myself. Well, it must have been contagious because the battery in our other car died a few weeks later, so I found myself wrenching away in the garage once again. Both cars should now have sufficient juice to power them for the next several years.
And now for the income side of the equation:
|Salary||$3,749||After taxes, health insurance, and 403(b) reduction|
Our total income for August was the lowest on record for the year. Unless disaster strikes, the remaining months should all be a little higher since I recently got a raise at work (woohoo!). The extra bump in pay will kick in starting with my September paycheck.
Our rental house in Kansas continues to dole out its monthly paycheck without problem. Our tenants just renewed their lease, so we should have continued rent checks through next July at the least. The house has an old refrigerator and an older A/C, so I keep waiting for a maintenance issue to rear its head. Out of paranoia, I recently increased my “rental house upkeep” cash reserve to $3,500 and will continue adding a couple hundred bucks a month to it. I don’t want to be caught off guard when everything breaks at once.
August was not a “dividend” month, but we still received payouts from bond funds plus a smattering of bank interest. Next month will be significantly higher for dividends as September marks the end of the third quarter. Even during off months, we’re still nearing $200 in total monthly dividends, which makes me really happy.
Using the above figures, our savings rate for August works out to 38%. When I factor in my automatic 403(b) contribution and employer match, the total savings rate bumps up to 45.6%. That’s about the best we can hope for right now with one income and two mortgages.
Since September is both a dividend month and the first month following my recent pay raise, I have high hopes that our savings rate will break the 50% barrier once again. Stay tuned, and here’s to a happy, healthy, and wealthy September!