We went over our grocery budget this month...by A LOT. We're about $150 over budget this month! Part of that was mother's day and C's birthday. We didn't eat out either time but we did buy steaks and have really nice dinners at home. The other reason our grocery budget has been creeping up (it was $75 over last month and right on target - a target that was $50 higher than usual - the month before that) is because the baby isn't a baby anymore and insists on eating real food, lots and lots of real food, instead of the free breastmilk I had been so lovingly supplying him for the majority of his lifetime. I'm still nursing but at a year old that is slowing down dramatically and the real food and whole milk has taken over as it should. And then of course are the two older children who also continue to grow up and get bigger and eat more even though I have not authorized this. Heh. I think the grocery budget needs to be permanently increased from $450/month to $550/month starting in June. After all, it's my birthday next month and father's day. I see at least one more steak dinner in our future! Feeding a family of five on $550/month seems about right to me. I don't think we're being particularly excessive with our grocery budget. Do you?
Also in June I'm going to increase our gas and restaurant budget, but only for the one month. You see, we'll be traveling to Iowa this weekend to visit our brand new nephew and we'll need additional money for gas and snacks/food on the way there and back! I'm so excited to meet the new precious bundle!
And in June I'm also going to start a new budget line item for charity. I'm going to set it at $50/month and C and I will pick out a different charity each month to support. I know we'll be supporting Heifer International, a cancer charity, a local food shelf and a local battered women's shelter. I'm also leaning towards another international charity or two focused on water and sustainable living and/or illiteracy and women's education.
Our budget this month (final numbers will be published next week) shows us saving over $1900 of the >$6000 we brought home (after taxes, healthcare and my 401k 8% contribution was taken out of our gross). Saving 1/3 of our take home income is great but maybe that means we have some room to increase some of our spending areas too. I think the grocery budget and charity line items are perfect places to adjust.
We Are Not Moving
Well, we're not moving to that house in our neighborhood at least. The house in our neighborhood went on the market recently at $215k. It's a 5 bedroom, 3.25 bath, 3 car garage house and it would have been great for our family. Then we went inside the house and decided it was no longer great for our family. There was mold in the master bedroom closet, likely from where the roof of the garage met the house. Roof leak? No thank you! Then in the basement they had a water leak from the bathroom shower and the sheet rock and all the flooring would need to be replaced not to mention making sure the leak was taken care of. No thank you! Then, the house didn't have appliances so take on $4-10k for that. Then there was all the cosmetic work the house would (eventually) need like refinishing the trashed hardwood floors, painting every (written on) wall in the house, replacing all the disgustingly dirty carpets, replacing the horribly ugly track lighting and light fixtures, etc. Basically the house was so cheap because it needed so much work! We backed away but the house had 6 offers in the first 3 days we found out from our realtor. It will be a great house for someone, just not us.
We're still thinking of moving and are keeping an eye out (and have automated internet searches set up) for other houses in our neighborhood. And until the perfect house comes our way we'll continue saving money like crazy and also paying down our mortgage each month. We're currently paying about $550/month to our principal.
One nice thing we were told by a mortgage guy though is we could do basically anything we wanted because our credit scores are so high and our debt to income ratio is perfect and we're the perfect borrowers in their eyes. Aw! Thanks!
We're still thinking of moving and are keeping an eye out (and have automated internet searches set up) for other houses in our neighborhood. And until the perfect house comes our way we'll continue saving money like crazy and also paying down our mortgage each month. We're currently paying about $550/month to our principal.
One nice thing we were told by a mortgage guy though is we could do basically anything we wanted because our credit scores are so high and our debt to income ratio is perfect and we're the perfect borrowers in their eyes. Aw! Thanks!
First Tuition Payment Made
*I wrote this post over a week ago and just noticed today that it didn't post due to all the Blogger issues of last week. I'll share it with you now instead.*
C registered for his first class a week or so ago. This is the first class (of many) to getting him a nursing degree. He's taking a few prerequisites this summer and fall and then will apply in February for (hopeful) admittance for next fall (of 2012) for the two year nursing program. Not even a day after getting confirmation that he's registered we received the e-mail saying his tuition is due! He starts class on June 1st but tuition is due on May 13th. And because this is a science class with a lab, the tuition is a bit pricey since it's a higher number of credit hours. Monday night I paid his tuition with my credit card. Good-bye $663.24! Then I immediately set up the transfer from our tuition savings account for the same amount. Once that amount hits our checking account and the charge has cleared our credit card, I'll pay the credit card balance (and be thankful to get 1% cash back!).
C still has to buy his books for the class. He's estimating that could be as much as $400! We're hoping he can find some used books on Half.com and keep the cost closer to $300. Yikes. I think after the emergency fund is complete that we may have to bolster that tuition fund. The amount we have in there isn't going to go far at this rate!
C registered for his first class a week or so ago. This is the first class (of many) to getting him a nursing degree. He's taking a few prerequisites this summer and fall and then will apply in February for (hopeful) admittance for next fall (of 2012) for the two year nursing program. Not even a day after getting confirmation that he's registered we received the e-mail saying his tuition is due! He starts class on June 1st but tuition is due on May 13th. And because this is a science class with a lab, the tuition is a bit pricey since it's a higher number of credit hours. Monday night I paid his tuition with my credit card. Good-bye $663.24! Then I immediately set up the transfer from our tuition savings account for the same amount. Once that amount hits our checking account and the charge has cleared our credit card, I'll pay the credit card balance (and be thankful to get 1% cash back!).
C still has to buy his books for the class. He's estimating that could be as much as $400! We're hoping he can find some used books on Half.com and keep the cost closer to $300. Yikes. I think after the emergency fund is complete that we may have to bolster that tuition fund. The amount we have in there isn't going to go far at this rate!
Emergency Fund at 5 digits!
Last night I set up a transfer from our checking account to our emergency fund for $1641.91. That amount is $1550 from our budget and $91.91 in snowflakes. With this large addition, our emergency fund finally hit the five digit mark! And not only that but we're now at $11.5k in our emergency fund! I am on a financial high right now!
Disclaimer: Murphy - this is not an invitation for you to come knocking on our door. Please stay away.
Disclaimer: Murphy - this is not an invitation for you to come knocking on our door. Please stay away.
New Emergency Fund Goal
I'm pretty sure we're going to be able to achieve our emergency fund goal before the end of the year. That is, if we don't move, of course. I'm so excited for that account to hit the $20k mark! Then we can decide what to do next - go crazy saving money to finish the basement? Put a bunch of money in savings to go on a vacation or two? Max out our retirement savings? Spend frivolously (or at least not quite as frugally as we are now)? The possibilities are endless. I'm trying to be "gazelle-intense" on our emergency fund right now so we can finish it as soon as possible. But I've also been thinking lately that maybe $20,000 isn't the right number. I made up a mock "emergency" budget today to see exactly how much money we'd need if we lost all employment income. Here is what it looked like:
As you can see, our total monthly budget is around $3600. Then I also calculated some of the big yearly expenses that we have. If I multiplied our monthly emergency budget by 6 and then added our extra yearly expenses I came up with about $23.5k that we should really have as our goal. I think we should round that number up to $25k just to cover anything that I'm not remembering right now and to cushion us just a little bit more.
I think we'll stay focused on our $20k goal and push to have that complete before the end of the year. Then I think we'll put $100 or $200 per month in emergency savings and put the rest of our monthly "extra" money elsewhere. We can keep doing this until we hit $25k in our emergency fund and maybe then we'll have to recalculate again to make sure $25k is the right number.
As you can see, our total monthly budget is around $3600. Then I also calculated some of the big yearly expenses that we have. If I multiplied our monthly emergency budget by 6 and then added our extra yearly expenses I came up with about $23.5k that we should really have as our goal. I think we should round that number up to $25k just to cover anything that I'm not remembering right now and to cushion us just a little bit more.
I think we'll stay focused on our $20k goal and push to have that complete before the end of the year. Then I think we'll put $100 or $200 per month in emergency savings and put the rest of our monthly "extra" money elsewhere. We can keep doing this until we hit $25k in our emergency fund and maybe then we'll have to recalculate again to make sure $25k is the right number.
Toot! Toot!
Not to toot my own horn but let me just toot my own horn for a second here...
As part of the mortgage pre-approval process our mortgage guy pulled our credit scores and shared them with us. They were pretty darn good! Look!
I haven't checked our scores or reports in over a year (bad me!) so this was a nice confirmation that we're on the right track. (And of course I got a small dig in at C that my scores are higher!) I should still pull our free report for this year just to make sure nothing funny is going on. I'll put that on my never ending to-do list!
As part of the mortgage pre-approval process our mortgage guy pulled our credit scores and shared them with us. They were pretty darn good! Look!
I haven't checked our scores or reports in over a year (bad me!) so this was a nice confirmation that we're on the right track. (And of course I got a small dig in at C that my scores are higher!) I should still pull our free report for this year just to make sure nothing funny is going on. I'll put that on my never ending to-do list!
House Projects are all the Rage!
In an effort to get our house ready to sell (if we do), we’ve been doing some house projects. The first was to clean out our closets. We sent our first batch of items to goodwill last month. In all we sent 73 items out of the house in 4 garbage bags. It always feels good to purge the extras!
We’ve also been doing some improvements. We bought a drywall patch for a small hole in the baby’s room from where the glider leg went through the wall (thanks kids!). That was only a couple dollars. Then we also bought a drywall anchor screw to repair once and for all the toilet paper holder in the bathroom on the main level (thanks kids!) and then we bought a curtain rod and tie backs ($30) for the baby’s room. Previously he just had a shade in his room so now it looks more “finished” with curtains up. We already had the curtains, just needed the rod. So far, our expenses have been minimal. The most costly project that we’re undertaking is our kitchen backsplash. We found tile at Lowe’s that looks great with our countertops, cabinets and floors. We’ve bought 11 pieces of tile so far (that’s all Lowe’s had in stock on Sunday) for roughly $75. We’ll need 3-4 more pieces of tile plus grout before we can finish the project. All told, the project should cost us around $100 but I think it will make our kitchen look so much nice and more finished! We’ve wanted to do this anyway (it’s on our want list!) so regardless if we sell the house now or later, I’m glad we’re doing this project.
We’ve also been doing some improvements. We bought a drywall patch for a small hole in the baby’s room from where the glider leg went through the wall (thanks kids!). That was only a couple dollars. Then we also bought a drywall anchor screw to repair once and for all the toilet paper holder in the bathroom on the main level (thanks kids!) and then we bought a curtain rod and tie backs ($30) for the baby’s room. Previously he just had a shade in his room so now it looks more “finished” with curtains up. We already had the curtains, just needed the rod. So far, our expenses have been minimal. The most costly project that we’re undertaking is our kitchen backsplash. We found tile at Lowe’s that looks great with our countertops, cabinets and floors. We’ve bought 11 pieces of tile so far (that’s all Lowe’s had in stock on Sunday) for roughly $75. We’ll need 3-4 more pieces of tile plus grout before we can finish the project. All told, the project should cost us around $100 but I think it will make our kitchen look so much nice and more finished! We’ve wanted to do this anyway (it’s on our want list!) so regardless if we sell the house now or later, I’m glad we’re doing this project.
Up in the Air
The house question is still up in the air. The house we’re interested in is not on the market yet. We’re still anxious to get inside and see what it looks like. But our excitement has been tempered a bit (a lot). We had a realtor come by a couple weeks ago and gave us the news that if we list our house, it should be for about $20k lower than what we currently owe on it. Ouch. That’s more cash that we’d have to bring to closing on our current house than we were hoping to have to bring. We were hoping the difference would only be $10k. But the realtor was willing to reduce his fee from 5% to 4% (listed on MLS) or even 3% (not listed on MLS) if we used him to buy the new house. Good news and bad news from that meeting.
Then we’ve been working with the mortgage guy from our credit union. I found out from him on Friday that we’d definitely qualify for an FHA loan which only required 3.5% down on the new house. Our income, credit scores and income to debt ratio are all excellent. We could even have mortgages on both houses and still have an acceptable income to debt ratio. Unfortunately, his underwriter won’t approve us for the new home loan with us being so underwater on our current house. He, like most other banks, is worried about us buying the new house and then walking away from the current house. We have absolutely zero intention of doing that but of course it’s still a risk he’d have to take on us. And right now, he’s unwilling to take that risk. He wants us to pay down our mortgage until we have 20% equity and then he’d approve us for the new mortgage. Yeah, that’s not going to happen. We don’t have $60k lying around just waiting to get applied to our current mortgage. The underwriter may be willing to compromise a bit, especially if our house was already on the market. So, we’re in a holding pattern there. Once again it was good news and bad news from that meeting.
So, we’re just keeping an eye on the new house. As soon as the for sale sign goes up we’ll get inside to look around. And in the mean time we’ll make small gains on our current mortgage through our monthly payments (~$550/month to principal right now) and we’ll keep saving as much money as we can each month through our normal income and through snowflakes. Right now we’re not going to increase our church contribution, Roth IRA contribution or charitable giving until the house question is answered.
Then we’ve been working with the mortgage guy from our credit union. I found out from him on Friday that we’d definitely qualify for an FHA loan which only required 3.5% down on the new house. Our income, credit scores and income to debt ratio are all excellent. We could even have mortgages on both houses and still have an acceptable income to debt ratio. Unfortunately, his underwriter won’t approve us for the new home loan with us being so underwater on our current house. He, like most other banks, is worried about us buying the new house and then walking away from the current house. We have absolutely zero intention of doing that but of course it’s still a risk he’d have to take on us. And right now, he’s unwilling to take that risk. He wants us to pay down our mortgage until we have 20% equity and then he’d approve us for the new mortgage. Yeah, that’s not going to happen. We don’t have $60k lying around just waiting to get applied to our current mortgage. The underwriter may be willing to compromise a bit, especially if our house was already on the market. So, we’re in a holding pattern there. Once again it was good news and bad news from that meeting.
So, we’re just keeping an eye on the new house. As soon as the for sale sign goes up we’ll get inside to look around. And in the mean time we’ll make small gains on our current mortgage through our monthly payments (~$550/month to principal right now) and we’ll keep saving as much money as we can each month through our normal income and through snowflakes. Right now we’re not going to increase our church contribution, Roth IRA contribution or charitable giving until the house question is answered.
"Fully Funded"
Did you take a look at our April Month End report? If so, you may have noticed (but probably not) that if you add the emergency fund and the tuition account that you exceed $20k for the first time. That’s very exciting for me! When C was laid off we took that as our opportunity to send him back to school which he’ll be starting this summer. To that end, we saved all of his unemployment income in a new account nicknamed tuition. Normally, that income would have gone to our emergency fund. Essentially if the worst happened right now, we have our six month emergency fund ready to go. We’d just have to tap the tuition fund to make that happen. Yay! Of course our real goal is to fund the emergency fund on its own and then to keep it at the $20k minimum while also sending C to school and paying cash along the way for that.
April 2011 Budget Report
April was another good month for us. We spent a lot of money but we brought home more income than we spent so I guess it's all OK!
I underestimated how much my raise would increase our income so we ended up bringing home almost $300 more than I anticipated. That's not a bad problem to have! I wish I could say all the difference went to savings but unfortunately we went over in a couple budget areas and that ate into the difference. We were over on gas by $25. Gas prices are really high right now (no shock to you!) and I hope we can stay within my increased budget of $300 in May. If not, I'll adjust it even higher for June. We were also over in groceries. I don't know if we're just buying more junk food (I doubt that accounts for all of the overage) or if we're seeing an uptick in grocery prices too or what but we were way over on groceries this month. We'll have to watch that in May so we don't blow the budget again! All other discretionary spending was pretty good!
We had a lot of one time expenses this month. L had his first birthday! I budgeted $150 for food for his party and his gifts and we came in at $125. Not bad! And I signed the kids up for spring and summer activities which ended up being a large expense. And then there were our splurge line items. The kids and I all received some new clothing this month. I thought for a while that I had overestimated what our income was going to be so I slashed C's splurge budget to $0 because he has a $50 Visa gift card that he received as a thank you from a client. That became his splurge money instead of budget money. He hasn't spent that money either! But, it's his to spend as he pleases in the future.
Overall we came in $216.19 under budget and I've already transferred that entire amount to our emergency fund!
I underestimated how much my raise would increase our income so we ended up bringing home almost $300 more than I anticipated. That's not a bad problem to have! I wish I could say all the difference went to savings but unfortunately we went over in a couple budget areas and that ate into the difference. We were over on gas by $25. Gas prices are really high right now (no shock to you!) and I hope we can stay within my increased budget of $300 in May. If not, I'll adjust it even higher for June. We were also over in groceries. I don't know if we're just buying more junk food (I doubt that accounts for all of the overage) or if we're seeing an uptick in grocery prices too or what but we were way over on groceries this month. We'll have to watch that in May so we don't blow the budget again! All other discretionary spending was pretty good!
We had a lot of one time expenses this month. L had his first birthday! I budgeted $150 for food for his party and his gifts and we came in at $125. Not bad! And I signed the kids up for spring and summer activities which ended up being a large expense. And then there were our splurge line items. The kids and I all received some new clothing this month. I thought for a while that I had overestimated what our income was going to be so I slashed C's splurge budget to $0 because he has a $50 Visa gift card that he received as a thank you from a client. That became his splurge money instead of budget money. He hasn't spent that money either! But, it's his to spend as he pleases in the future.
Overall we came in $216.19 under budget and I've already transferred that entire amount to our emergency fund!
April 2011 Month End
I haven't tallied up the final budget details (watch for those tomorrow) but all the month end balances are available for our accounts. Here is where our debt and savings stand:
Debts:
Truck Loan: $23,322.65 (-$440.05) - Regular payment made. No extra payments will be made here with a 0% loan!
Savings:
Emergency Fund: $9,670.97 (+349.26) - Most of this was again snowflakes. $241.51 to be exact. Not too bad! I expect to have another budget surplus to report tomorrow and as soon as I have the final number, that too will be added to savings. I expect we'll blow the $10k mark out of the water this month as it's the first full month of my raise. I even expect us to be over $11k by the end of May! It's so exciting!
Short Term Savings: $379.71 (+50.00) - This account is seeing nothing but growth lately. We'll change that! Today we bought most of the tile needed for us to tile out backsplash in our kitchen. The whole project should cost us around $100 and it's going to look so nice when it's done!
Travel Fund: $411.07 (+75.31) - The kids are already asking when we're going on vacation and is that tomorrow and why can't we go tomorrow? They're excited as are we and my in-laws who are coming with us. I can't wait to get away for a while...especially with two doting grandparents along to help with the kids! I may just get some free time! Woo-hoo!
Christmas Savings: $374.05 (+75.28) - Christmas could come today and we'd have enough money saved to make it a nice one. By December we'll have enough saved to spoil our children thoroughly. I love paying for Christmas with cash. It takes most of the stress out of the season so I can sit back and enjoy it.
Basement Finishing Fund: $129.94 (+0.11) - With the big gains in the emergency fund coming up, I'm hoping this account can come off the neglected list before the end of the year!
Tuition Fund: $10,620.91 (+58.66) - We're padding this account right now. C expects his first class to cost around $600 this summer plus books. Thank goodness we saved all that cash so we can sit back and pay for classes without stress or worry.
NetWorth:
Assets:
Savings: $25.3k (INGDirect subaccounts plus 529's)
Retirement: $253.5k (my 401k, my pension lump sum, C's company stock, C's Roth IRA)
House & Vehicles: $235.5k (house, truck, car, two motorcycles)
Liabilities:
Mortgage & Truck Loans: $244.6k
Networth = 25.3k + 253.5k + 235.5k - 244.6k = $269.7k - Our networth went down this month by about $4k. That's because I decreased our house value. I had been using a similar home in our neighborhood but that house sold in December of 2009. Since then home prices have dropped even further and our realtor gave us a market analysis lower than we were expecting. Our savings and retirement accounts saw nice gains and our mortgage and truck loans went down. Everything is headed in the right direction. Now only if home values would rise a little bit!
Overall we had a solid month. I'm pleased with our progress. Our 2011 is going well so far! (Crosses fingers that Murphy stays away!!)
Debts:
Truck Loan: $23,322.65 (-$440.05) - Regular payment made. No extra payments will be made here with a 0% loan!
Savings:
Emergency Fund: $9,670.97 (+349.26) - Most of this was again snowflakes. $241.51 to be exact. Not too bad! I expect to have another budget surplus to report tomorrow and as soon as I have the final number, that too will be added to savings. I expect we'll blow the $10k mark out of the water this month as it's the first full month of my raise. I even expect us to be over $11k by the end of May! It's so exciting!
Short Term Savings: $379.71 (+50.00) - This account is seeing nothing but growth lately. We'll change that! Today we bought most of the tile needed for us to tile out backsplash in our kitchen. The whole project should cost us around $100 and it's going to look so nice when it's done!
Travel Fund: $411.07 (+75.31) - The kids are already asking when we're going on vacation and is that tomorrow and why can't we go tomorrow? They're excited as are we and my in-laws who are coming with us. I can't wait to get away for a while...especially with two doting grandparents along to help with the kids! I may just get some free time! Woo-hoo!
Christmas Savings: $374.05 (+75.28) - Christmas could come today and we'd have enough money saved to make it a nice one. By December we'll have enough saved to spoil our children thoroughly. I love paying for Christmas with cash. It takes most of the stress out of the season so I can sit back and enjoy it.
Basement Finishing Fund: $129.94 (+0.11) - With the big gains in the emergency fund coming up, I'm hoping this account can come off the neglected list before the end of the year!
Tuition Fund: $10,620.91 (+58.66) - We're padding this account right now. C expects his first class to cost around $600 this summer plus books. Thank goodness we saved all that cash so we can sit back and pay for classes without stress or worry.
NetWorth:
Assets:
Savings: $25.3k (INGDirect subaccounts plus 529's)
Retirement: $253.5k (my 401k, my pension lump sum, C's company stock, C's Roth IRA)
House & Vehicles: $235.5k (house, truck, car, two motorcycles)
Liabilities:
Mortgage & Truck Loans: $244.6k
Networth = 25.3k + 253.5k + 235.5k - 244.6k = $269.7k - Our networth went down this month by about $4k. That's because I decreased our house value. I had been using a similar home in our neighborhood but that house sold in December of 2009. Since then home prices have dropped even further and our realtor gave us a market analysis lower than we were expecting. Our savings and retirement accounts saw nice gains and our mortgage and truck loans went down. Everything is headed in the right direction. Now only if home values would rise a little bit!
Overall we had a solid month. I'm pleased with our progress. Our 2011 is going well so far! (Crosses fingers that Murphy stays away!!)
Subscribe to:
Posts (Atom)
