I’ve been a little derelict in my monthly reviews because I’ve fallen off the budgeting horse – but I have some good excuses! The month spent living in my friend’s basement plus the last month of not having the Internet at home has meant my computer at home has laid dormant for the better part of two months. Normally I’ve kept careful records on my computer but with the two month hiatus I’ve enjoyed not recording every possible transaction I’ve had. What you will read below is instead a summary of the last few months and major financial decisions I’ve made.
Monthly Review Column
Every month I recap the “state of personal finances” in my household and bare it all to the world. While I don’t discuss income and net asset figures in absolutely, I do discuss percentage changes. My belief is that it doesn’t matter how much money someone earns, it’s what they do with it. While the principles of asset management at the millionaire level is probably different than at the “everyone else” level, I’m in that everyone else level so the numbers aren’t important.
May was a pretty big month as it included a huge asset added onto my books – my new home. Thank you to everyone who gave me suggestions and helped me avoid many of the pitfalls of purchasing a home and hopefully, for those of you who haven’t taken the plunge, some of the articles I’ve written and some of the comments many have left will help you in your journey. Since I haven’t moved in and am currently doing a rent-back, my expenditures haven’t increased to reflect the fat mortgage payment because I don’t think it’s necessary to show it yet. As for everything else, it’s out in the open for you all to read and pick at. 🙂
I’m going to take the plunge and join the level of financial transparency that other personal finance blogs are willing to reveal. If Flexo at ConsumerismCommentary.com and Nev at NevBlog.com bare it all (and have for quite some time) – I think I can do it too. I’ll detail, to the cent, my spending this month along with my budgetary targets. I’ll also reveal a little bit about my liquid and retirement assets and what I’m doing with them so that you all can comment and critique my decisions.
For those of you who know me in real life, I would truly appreciate discretion regarding my finances – but please feel free to talk to me about it (just not with others). Thanks!
Last month I cranked out some of my personal financials (sorry, only percentages, I’m not as comfortable as many of my contemporaries) and in keeping with the review of my Financial Outlook, I’ve compiled some of the more interesting statistics here. March saw me spend less because I was finally clear of any additional payments as a result of the car accident at the end of last year. I also had the good fortune of earning a “Results Sharing” bonus, that I didn’t even know existed for my company. So I spent less and earned more…
1. These percentages are calculated against my post-tax income, which already has 20% contributed to my employer’s 401k plan.
2. Budget Reserve is simply my safety blanket in the budget for overruns. 13% seems like quite a bit but any excess falls into Savings!
Meals was the only category that missed estimates by a small amount and I didn’t really see it as a big deal because it was down from the month before! I do enjoy going out to eat on the weekends after a week of my own pathetic cooking (where I eat the same thing for dinner and lunch the next day).
I thought that the Transportation/Gas component this month was going to be a little higher than usual because that’s where I put all my travel costs, including airline tickets, and I purchased a flight to Boston on Southwest for around $98 this month for my sister’s graduation. But apparently it didn’t push me over my target.
The numbers above don’t reflect any of the “Results Sharing” bonus I received. 20% of that went straight into my 401k, the other 80% went into my savings account. The bonus represented a 28.8% increase on my monthly gross income so you can see I was able to put a lot away, which will probably go towards a downpayment on a house.
I would’ve been 0% on clothing again, as is the expected, except for St. Patty’s day when I bought myself an Old Navy “Kiss Me I’m Irish” shirt. No one believed me though.
Eventually though I’ll have to pay my taxes ($372) and I’m not sure where that’s going to fall under, I suppose Other. So next month I’d expect to see some very skewed numbers in some categories. Cheers and thanks for reading.
A lot of personal finance blogs reveal their author’s entire financial picture; so that you can follow them on their quest and help them achieve their goals. I’m not going to give that much information but I think that in order to help me improve my budgeting system, I have to reveal it to the world and have the world poke holes. We’ll track it back to the start of the year. I’ll also give you a look into my 401k as well, percentages of course. In future posts in this category, Financial Outlook, it won’t be quite as verbose as this one.
* These percentages are calculated against my post-tax income, which already has 20% contributed to my employer’s 401k plan.
** Budget Reserve is simply my safety blanket in the budget for overruns. 13% seems like quite a bit but any excess falls into Savings!
Automotive (Jan): Last December, I was in an unfortunate car accident that totaled my car (2000 Acura Integra) at no fault of my own. So I had to purchase a new (used) car, which was a 2003 Toyota Celica, from a private owner in Florida with the insurance company’s funds. But, that also meant I needed to purchase four new all-season tires (since Florida cars don’t know of seasons) which set me back in the Automotive category. Usually that category is very small, consisting of oil changes. I also had to get the tint removed to pass inspection, a $100 ding.
Other (Jan): Usually the Other category is also pretty small too, I try to put anything I spend in a category other than Other. I made a donation to the American Cancer Society and I couldn’t really justify putting it anywhere so it went into Other.
Meals (Feb): 10% is far too much to be spending on Meals. I usually try to keep this somewhere under 7% (achieved in January) and I’ll have to bring lunch to work more often.
Recreation (Feb): I took a nearly weeklong trip for Mardis Gras and a weekend trip to Seven Springs ski resort. I’m allowed to take vacations! 🙂
I don’t really restrict my spending to a dollar amount but I do try to keep things in range of percentages I feel comfortable with. I want to save at least 20% of my income, 30% if possible, and I trim where I find it easiest to trim. Sometimes aberrations (like Automotive in January) are unavoidable, that’s when the Budget Reserve comes into play. Hopefully overruns don’t exceed 13% and starts to dip into the real reserve, my emergency fund.
Onto the 401k…