Sometimes I get a little nervous about making our personal finances public. A lot has changed since we started sharing our family budget with the world, and in some ways I think we’re less relatable now than we were then. For example, our income this month is more than triple what we made four years ago.
Still, we were able to make headway on paying off our student loans back then even with a much smaller income. We were motivated and determined to get rid of our debt. We were much more faithful at keeping our grocery budget low and having few budget categories. Pretty much if it wasn’t essential we didn’t spend money on it.
And we kept that up for a long time!
I’m glad we kept a record of our progress because it reminds me that we can do hard things. I like to go back every now and then to see how far we’ve come. I’m proud of us for sticking to our guns so long and not giving up on our goal to be debt-free.
If you’re feeling overwhelmed or discouraged with your current progress toward your goals, don’t give up! Just take one day at a time. Don’t feel like you have to master everything all at once. Pick one area of your finances that you’re going to improve this month.
Maybe you’ll sell five things that your don’t use or need anymore. Maybe you’ll start the month out with a menu plan. Maybe you’ll diligently save electricity. Maybe you’ll track all of your expenses so you can have a baseline for starting a budget. Maybe you’ll act on the business idea that’s been swirling around your mind for ages.
Next month you can add something else. Little by little you’ll be transformed into a frugal-living, goal-reaching superstar! In four years you’ll be able to look back and see your progress and wonder how you made it happen. I know you can do this!
Now on to the numbers from our books last month:
Our total income for October was $13,721. Since we live on last month’s income, this is money that we’re waiting to spend in November.
Attorney Income (Day Job)– $6,215 Mr. SixFiguresUnder has been working full-time as an attorney for the state of California since the fall of 2015. In October he got his anniversary raise! His actual take-home pay was $5,021 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 you can see what happens to the money that never makes it home.
Attorney Income (Private Practice)– $895 On top of working full-time, my husband has a part-time private law practice on the side. He started it to help speed up our debt payoff and because he had clients from his days at a small firm that didn’t want to let him go. This income fluctuates greatly from month to month. Between a natural lull and a new baby, he didn’t spend a lot of time on this private work in the past couple of months.
My Income (Blog)– $6,611 The income that I report is the income that I received this month minus all of my blogging expenses. Of this, I set 30% ($1,983) aside for self-employment taxes (which currently covers the estimated quarterly payments for both of our businesses) and the remainder ($4,628) goes into the family budget.
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.
Each month we budget down to zero using last month’s income. When we started doing this, it literally changed our lives! 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. Here’s how we spent money in October.
Other Giving– $80 Other charitable donations this month.
Mortgage/Rent– $2,700 We pay about $200 over our actual mortgage. We started doing so when my husband’s paychecks went up $200, but we may change that soon. Stay tuned.
Curious about our mortgage? You can read more about why we got a conventional mortgage instead of FHA or USDA and then why we didn’t wait for a 20% down payment.
Electricity– $183 We are pretty careful about our electricity usage and thankfully September cooled off so we hardly had to use our air conditioning. Keep in mind that our electric bill covers the small rental we have on our property as well.
We have been really motivated by the OhmConnect program which lets you earn extra money for saving power. My kids think it’s super fun to save power now. If you’re in California, Toronto or Texas, you should definitely check it out!
Water– $45 Our water bill comes every other month, so I just set aside approximately half of what I expect the bill to be (or what it is).
Trash– $62 Our bill for trash service comes every other month, so I set aside half of the bill each month. We’re currently paying for curbside pickup, but that’s not the only way to do it. If you’re trying to cut every expense to its bare minimum, here are some ideas to save on trash service. This month we also paid to take an old upright freezer (left in the garage when we bought the home) to the dump. I was really hoping that it would work (as you know I love extra freezer space), but when we finally cleaned it out and plugged it in, it smelled like an electrical fire waiting to happen, so off it went. Just weeks after discovering that the freezer was a no-go, a friend offered us a fridge/freezer that they were getting rid of! I’m excited to plug it in and have more storage for produce and freezer meals!
Internet– $50 After surviving so long without internet, I’m thrilled to be paying an internet bill (and a nice low one too)! It’s been months now, and we’re still oozing with gratitude to have internet access in our very own home. We won’t quickly forget what it’s like to go without it.
Home Phone- $4 Since my husband works at home a day or two each week, we decided to get a home phone for him to use. It’s Ooma, which is internet-based, not a traditional land line. The monthly service is very inexepensive and the set-up (hardware, etc) was under $100 (and my link will get you a $20 Amazon gift card on top of it!).
Republic Wireless Cell Phones– $15 We’ve been using Republic Wireless as our cell phone carrier for over two years now. This covers the cost of service for my phone, including all taxes and fees (we’re on the Republic Refund plan). My husband also has a Republic phone which he uses for his private practice, but that’s a business expense, not a family budget expense. If your cell phone bill is killing you, I definitely recommend that you check them out!
Health Insurance– $408 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 and comes straight out of his paycheck.
Car Insurance– $140 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 father-in-law was in the service years ago. If you, your parent, or your spouse were in the military, you’re probably eligible for USAA too!
Food– $447 Our grocery budget was high this month as we had company for two weeks.
Gas– $348 We took a family trip along with my parents who were visiting us. That driving just replaced the driving my husband would have done if he had been commuting during those days, so it didn’t impact our gas spending at all. It’s actually lower than last month.
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– $49 I didn’t buy shoes at the beginning of the school year, so I’m a couple of months late. After buying expensive Nikes for our three school-age kids last year and having them barely last three months (huge disappointment, by the way), I decided to just buy Walmart tennis shoes now, which last at least as long at a quarter of the price.
Household– $129 Our household budget this month included a $20 set of four tray tables from the thrift store, printing family pictures for the living room wall, invitations for my oldest son’s baptism, a new can opener, a lice comb (oh the joys of the back-to-school season) and the normal toiletries.
Fun– $84 We went out to eat for my second son’s birthday with my parents while they were in town. We just started going out to eat for birthdays this year. We didn’t go out to eat at all when we were in debt (unless we had a gift card to cover it), so this is a new experience for the kids (which they really enjoy).
Kids– $14 My older son is in Cub Scouts now and needed a handbook. I was able to get the essential uniform pieces at the thrift store, which is great because they cost an arm and a leg if you buy them new!
Home Improvement– $107 We used up the remainder of balance in this category (about $40) plus $107 from this month’s budget. I spent $60 on fabric to recover a glider that I got for free from a friend and to make 6-8 throw pillows for our couches. I wanted to tackle the glider while my mom was in town (she ended up essentially doing it herself). I love it! I should get to the pillows in the coming weeks. We also used a couple of Home Depot gift cards to buy a new ceiling fan for our living room (the current fan is way too small for the room and provides very little air circulation or light). The gift cards covered the majority of the fan purchase.
Animals– $228 We bought cat food for our outdoor cats. We encourage them to catch rodents, but we do give them cat food too. We also bought chicken feed. The majority of the animal expense this month was for supplies for the coop/run. Knowing we would be going out of town in October and November, my husband completely enclosed the chicken run so the chicken coop doesn’t need to be closed by us at night. He also built a watering system that will take care of itself while we’re away.
Tax Prep– $90 Our tax advice and preparation plan allows the cost to be spread over the year.
Supplemental Property Tax– $158 The property tax that is escrowed with our mortgage doesn’t include the increase in taxes that comes from the reassessment at the sale of a property. California property tax law is a peculiar thing and we don’t need to cover all the details, but in short, when a property changes hands, the property tax bill generally goes up. This wasn’t a fun notice to find in the mail. If we set aside this much in each month, we will have enough for the bill when it’s due in December.
Now that we’re done funneling every extra cent toward debt, we are using sinking funds in our budgeting. This is money that we set aside each month into certain categories where it builds up until we need it.
Dental– $0 Our goal is to put $30 in a fund for dental expenses, but we didn’t contribute to it this month.
Car Repair– $50 We normally put $150 in for future car repairs, but we skimped this month.
Medical– $54 We contributed $90 to the medical category this month, but $36 of that was used during this month. This covered a couple of office visits and some prescriptions. Right now we have $947 saved in our medical fund. I thought we would have bills from the doctor and hospital for baby’s delivery by now, but they haven’t showed up. Maybe more is covered than we thought (we haven’t had a baby on this insurance before, so we don’t have any experience with it)!
Car Registration & Smog– $0 We skipped this in October. Normally we put $20 in.
Christmas– $8 I had set aside $50 for our Christmas fund, but spent $42 on Christmas gifts. Right now we just have $86 in our Christmas fund.
Life Insurance– $70 If we put aside $70 each month, we will have our premiums set aside when they’re due next month.
Gifts– ($26) While we didn’t contribute to our gifts fund this month, I did spend $26 for my second son’s birthday.
Retirement– $539 With my husband’s state job, this amount comes directly out of his paycheck and into his state retirement fund.
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.
Here’s a quick look at our current savings goals. We’ve taken care of taxes, the cost of getting internet installed, and saving for a new (used) car.
The next goal is to beef up our our emergency fund. We’ve set the goal amount at $25,000, so we still have a long way to go!
During October, we added a mere $200 to our emergency fund, which brings the total up to $9,700. We knew we wouldn’t make much progress here in October since September’s income was lower, but we had hoped to get it over $10,000. Oh well! We’ll save that excitement for next month!
In addition to our financial goals for 2017 and beyond, we’re also saving for some larger items. To make this list, an item must potentially cost $1,000 or more (sometimes much more).
California King bed
- Desktop Computer— Last year, as we were saving for our house, our desktop computer died. We were eager to replace it, but more eager to get a house. We don’t have a TV, so the computer has been our screen for watching occasional movies. We’ve been getting by using our laptops, but are looking forward to having our normal set-up back. My husband will buy the components he wants and put it together himself (he’s a computer guy). I’m hoping we’ll find some online Black Friday deals in this area.
- Garage Door— Our garage door needs to be replaced (both door and motor). The estimate is something like $2,400.
- Privacy Hedge— We want to plant some sort of hedge along the roadside of our house. Hopefully we can get something planted in the fall/winter when temperatures are milder.
We have prioritized them and will be saving and spending from our “Home Improvement” category for these purchases.
How About You?
- I’d love to hear about how your budget and/or debt repayment went in October!
- If you have any questions about how we budget, I’m happy to answer them in the comments or in a future post.