Posts by: Paul
Highlights from last month.
- The stock market is up again, which is benefiting me greatly on paper. However, these gains aren’t realized unless I sold the investments, so they could be fleeting.
- Cash is down again this month. I’ll have a post about my spending later in the month. Looks like a lot of it had to do with reduction of credit card debt.
- Debt is down across the board. I love it when a month comes together
. - Once again another record! I love watching this go up.
I think I said the same thing last year around this time… I’d like to start tracking my spending better and posting about it monthly. Hopefully this will help hold us accountable. It’s my feeling that we spend way more than we need to, so here’s the first update.
First let’s talk about the layout. The guidance column is what we spent last year on average, give or take. It’s not perfect, but close. The ‘Total Remaining’ row indicates how much money we netted at the end of the month given all of our income, spending, and scheduled saving. In the ‘Bills’ section, the ‘Other’ row indicates all unplanned spending outside the categories of the rest of the bills. For example, in March we payed income tax due to filing our return, so that was an unplanned expense. The ‘Scheduled Savings’ section indicates all non-retirement automatic savings that happens every pay period. Other than the generic ‘Savings’ row, most of the ‘Scheduled Savings’ is marked to be spent later. When spent it will show up in the ‘Bills’ section somewhere.
Now for some analysis. This month was a little bit odd because my wife and I both got paid three times. Stating that, I would have loved to see a much larger net gain in cash at the end of the month due to the extra income, but the taxes blew that right out of the water. A little more than half of our ‘Other’ spending was income taxes. Yuck. Our tax rate has stayed pretty steady the past few years, so we’re working on getting the proper amount taken out of our paychecks so we don’t get hit with this surprise again next year.
We spent more on house cleaning than usual, but that’s because my cleaner comes on payday, and I’ve already stated that happened three times in March .
Dining out looks to have been a bit large last month as well. I didn’t look to see where all of that went, but it’s about double our average spend last year. We’re on track to bring that down this month, as we’re at about $93 spent dining out and we’re halfway through April.
Given everything, we would have netted about $2200 without the tax surprise. I think I would have been fairly happy with that given our current spend rate. I’m going to chalk this up as an ok month given we haven’t done much yet to curb spending. Look for some posts in the near future about how I plan on cutting some spending.
I did a quick run through in Mint the other day and saw something horrible…. It said I spent $58000 last year! Holy shit, that is way too much. And, to make matters worse, it wasn’t counting 9 car payments at $250 each and 10 mortgage payments at $700 each!** That’s an additional $9250 bringing my grand total to $67000, assuming Mint didn’t miss anything else. I know, I know, a portion of those mortgage payments go to home equity (about half). So maybe the final number is more like $63500.
This is an emergency. I need to set a goal and I need to set one now. There is absolutely no reason my household needs to spend this much money in one year. I am hereby setting a goal to reduce this number by $10,000 for 2013, to $53500.
In a way I find this kind of amusing. I’ve never really looked at how much I’ve spent before, only how much I’ve saved. The funny thing is, if you know how much you make, and you know how much you save… you obviously spend the rest.
Money Spent = Money Made – Money Saved
This is surprisingly simple and yet something I have never thought of before. The other amusing part is when I look at that $67000 number, for the life of me I can’t figure out where it all went. Even though Mint is, ahem, fucking telling me where it all went, I still can’t fathom it. We spent $7000 just on vacations last year! Granted, we had a great time in Las Vegas with Don and his wife, and I don’t regret it, but maybe we could plan our trips a bit better this year. We took at least three trips!
We also spent close to $13000 on vehicle related stuff, about $4000 of which was gasoline. Gasoline! About $6000 was due to the purchase of my wife’s new vehicle, including down payment and monthly payments. The rest was insurance and maintenance for the most part. Unreal.
The category in second place was Food and Dining. When I drill into that, I see $6200 in groceries and another $2800 in restaurants. I can’t say that the restaurant number is a surprise to me, but the grocery bill seems huge. I understand that we have a young child and have to buy diapers, and some portion of the year we were buying formula and baby food. But come on, six thousand dollars? We need to start shopping more at cheaper places, and maybe using some coupons.
We spent a bunch of other money too that I’m not going to get into now. What’s really killing me at this point is that I’ve been wanting to get a new-to-me car and gain a couple of doors to aid in transporting my young son. I was planning to spend somewhere around $25k on this vehicle to get something I really like (BMW 3-series), but is reasonably priced and reasonably old due to my short commute. No need for something brand new when you only drive 5000 miles per year. But now I feel like I might need to compromise a bit further on this purchase, and may need to rethink my options. I do still want to get a 4 door car, but maybe something cheaper, with better gas mileage is in the works. This blows. Maybe I can trade the wife in.
Just Kidding!
WTF. And another thing! I’ve recently skimmed through the entirety of Mr. Money Mustache’s blog, and he spends less than $30k per year. While I was reading that I was thinking that I wasn’t too far off from that, maybe $40k. Yeah right. Fuck.
**I had to do some account shuffling due to a bank closure and mistakenly deleted a bunch of history from Mint. So this missing information is not Mint’s fault, but my own.
Highlights from last month.
- The stock market keeps going up, and my investments keep benefiting. The gains appear to be slowing after the recent run up.
- Cash is down, which is annoying me. I owed $1600 in federal taxes, which pretty much killed any savings we might have accumulated this month, which is despicable. Look for a future post where I analyze my 2012 spending. It will be clear to you why a $1600 tax bill shouldn’t kill our monthly saving. Another reason this is down a bit is due to a purchase of two shares of Apple stock, which corresponds with a matching increase in investments.
- Another net worth record, besting last month’s record!
I’ve done the same analysis as Don on my ‘Long-term Bill Account’ that I fund for property taxes, garbage, home insurance, and car insurance. These are all bills that I pay once or twice per year, so I just fund this account with a fixed amount each paycheck. Then, when these bills arrive I just pay them out of this account. It’s sort of like Accounts Payable.
Anyway, I’m happy to note that this account hasn’t dipped below $1900 in the last year, which means I have $1900 just sitting there doing nothing in that account. So, for cleaner accounting, I’ll be transferring about $1500 of that ‘found’ money into my house down payment savings account (leaving a buffer of $400 just in case). Nothing like finding $1500 that you didn’t know you had!
Long Term Bill Account trend:
Notice that I don’t have the trend for March and April of last year, but I don’t receive any bills that I would pay out of this account in that time period, so it won’t be falling in balance at all between now and May.
Highlights from last month.
- Investments are looking great again due to a fantastic start of the year for the stock market. I don’t expect this to last much longer given sequestration, plus the fact that the gains have to slow/stop/drop at some point. Nevertheless it’s nice to see my investments keep rising.
- Cash is up again, which is a pleasant surprise given the huge drop in credit card debt over the past two months. I would have expected cash to be down given the large CC bills we’ve been paying lately.
- It’s always nice to see the color green across the board in the Liabilities department.
- A nice $20,000 increase in two months. Wow! Again, these great gains can’t last forever, but even without the investment gains I’m still up ~$6,000 which is great to see.
- A new net worth record, besting the previous of $319,259 set in January of this year!
Wow, what a great year! The end result was better than I ever expected. I’m really happy to see that our diligent saving is paying off in more ways than one.
First, our investments grew by 40% due to a great stock market year as well as continuing to follow the ‘pay yourself first’ philosophy. Collectively, my wife and I contributed almost $30,000 to our retirement accounts in 2012.
Second, our cash savings grew by nearly 45%. We’re doing our best to save towards a down payment on a new home, so I’m glad to see we had some success doing that over the past year. I’m hoping to be able to contribute more towards this goal in 2013.
I’m not thrilled to see the increase in Liabilities, but the needed purchase of a car for my wife kind of forced our hand. I will likely also be getting a new car this year to help accommodate a better family life by adding a few more doors.
Here’s to another great year in 2013!
Sorry about the lack of posts recently (no updates since September). I had been working overtime at work from August through November, and am just getting back into the realm of normalcy. However, I did record the numbers for October, but just didn’t post about them, so here they are first:
And the numbers for January:
Highlights from last month.
- Investments are up a substantial amount, mostly due to stock market gains, but partially due to the overtime pay from work. The overtime pay actually pushed me over the pre-tax 401k contribution limit for the year. I had my first post-tax contribution ever in the last paycheck of 2012!
- Cash is up in a big way, most of which has gone into our savings for a house down payment. This staggering increase results from my wife’s recent promotion at work and all of the overtime I had been working.
- Nothing fancy in the debt department other than a large credit card balance due to a recent trip. That will be paid off when the bill comes.
- A nice $20,000/6.5% increase in overall net worth since 1-October! Not bad for 3 months!
Check back soon for an analysis of my personal fiscal year 2012.
Highlights from last month.
- Great gains in cash this month, mostly due to receiving 3 paychecks instead of two. We’ve also done well in the spending department this month.
- Credit card debt is way up due to putting money against our next vacation. We’ve also paid about $1000 to carpet a portion of our basement, which I may carry on the card for a few months due to having 0% interest until next March.
- Finally Zillow said my house went up in value! The rapidity of change here seems extreme to me….
- Another finally: the car value change make sense, and by make sense I mean they actually dropped this month instead of gone up. I’m going to continue to carry the new car at cost until the NADA values it less than what I paid. Right now the NADA thinks it’s worth about $2k more than what I paid.
- This month is a new net worth record for me! I blew past the last one, which was May 2012, by about $8k. The gains were mostly due to stock market performance. It’s exciting to see such a large gain for the month!
Wow, it’s amazing how quickly a year goes by. I’ve now been tracking my net worth on this blog for over a year and thought I would expend a post analyzing how things have changed in the past 13 months.
As you can see from the charts, a lot has changed! I’m happy to note that my net worth is up 15.5%, which is a great gain for about a year’s worth of savings. Other noteworthy changes:
- Zillow thinks my house is worth $10k less than it was at this time last year, which is a bit discouraging. Just think where my net worth would be had it remained the same.
- Debt is down across the board with the exception of our new car loan, which more than offsets the gain in vehicle value we see in the assets section.
- Great increases in cash and investments this year! A lot of the investment gain is from contributions, but still solid. I’m excited to see how those increase once the economy picks up the pace a bit, which could be years away.
Overall I’m very happy with the past year. I’m definitely hoping to see our net worth grow over the $300k mark by the end of this calendar year, but that may be a bit lofty.
Donald
Age: 32
Assets: $401,669
Liabilities: ($129,290)
Net Worth: $272,379Memberships
Paul
Age: 31
Assets: 477,660
Liabilities: ($123,725)
Net Worth: $353,935
