Since we are nearing the end of yet another month, we thought now would be a good time to outline our monthly process with regards to our personal finances. Here is a general outline of our Monthly Money Routine that you can use to personalize your own!. Personal finance is a regular activity in your life that you have to partake in. You won’t be able to organize your finances in a weekend and be set for life. It is a repetitive task that must be regularly monitored and adjusted as you go through life. This is especially true at the beginning of your journey. It will be difficult and uncomfortable as you start. And you will feel yourself not meeting many of your goals but you have to get through the bad to get to the good. With a Monthly Money Routine, you will be able to check-in on your finances from a big-picture perspective every month to make adjustments and review what worked and what didn’t. Here are the steps we take each month to ensure we are on the same page as each other and on track towards our longer-term goals. Beginning of the Month The beginning of the month is the time to start anew. Clean sheets and prepared goals allow you to reorganize so come the 15th you don’t suddenly realize you are completely lost! Review the Calendar As a new month approaches, usually a week or so before, look over the new month’s calendar. You will be looking for any potential spending. Maybe that will be nights out with friends, birthdays, car registration due dates, holidays, doctor’s appointments, etc. With this information, you can plan for any additional spending and keep those dates on your radar. You will also want to review the next few months briefly to ensure there is nothing too large that you will need to plan ahead for (i.e. Christmas or a wedding). Keep in mind we are not avid budgeters. Although we set an overall spending goal for the month, this number doesn’t often change, nor do we set up specific category budgets. If you do feel like more detailed budgeting is a better option for you, be sure to set your categories’ specific budgets as you review the calendar! Set Monthly Goals Next up, you will want to set your monthly goals. You will want to do this before the month starts so Day 1 you are ready with a plan in mind. Every day counts. When making your goals, be sure to review your annual goals to ensure these monthly goals will help get you closer. We always have at least one money goal whether that is to save more, have no spend days, get a new rewards credit card, etc. And then I will add 2-3 other personal, relationship, or work-related goals to ensure all areas of my life are oriented. Include the Monthly Money Challenge Each month we are setting a monthly money challenge for ourselves, and hopefully for you! Be sure to add the challenge into your monthly goals so you can make it a top financial priority for the month! Check out our first official month, October’s No Spend Challenge. With each month, you will want to discern what the challenge is and start to game plan how you can participate. There may be some sort of tracker you need to set up. Or maybe you need to purchase something in advance in order to properly complete the goal. For example, The Budget Mom challenges her following to not purchase coffee all month so you may need to buy the right kind of coffee or creamer so you can successfully accomplish the challenge. Set Up New Daily Spend Sheets The first of the month is usually a shopping day as we are crunching our spending at the very end of the month (at least recently, see September Spending Report). In order to stay on top of our daily spending, I need to ensure I have my sheets set up ahead of time. This means having them printed and set up with any categorized budgets. I will staple everything together and stick it in the filing cabinet by my desk for quick and easy access. PS my filing cabinet is only organized because I obsessed over the book, Getting Things Done. Total game changer. What are Daily Spend Sheets? We manually track our spending on a (mostly) daily basis. Tracking manually helps make spending a lot more real as you have to write down the total amount for every transaction. It allows us to see exactly how close we are to our set budget after each transaction. With these Daily Spend Sheets, we can have an organized hub to track all our transactions and won’t miss any important details. Now, we won’t be tracking every dollar we spend manually for the rest of our lives, but we will always know where our money is going. Right now, these manual trackers help us to keep a budget as we hone in some of our spending patterns. End of the Month After getting everything set up for a successful month of tracking your spending and hitting financial goals, you will need to follow up and recap at the end of the month. Here are the four steps we take at the end of every month. Update Net Worth This has been a newer monthly task for us as we only started tracking our net worth in March of this year. I wish we would have started so much sooner, though! It has been so motivating for us to track our growing net worth with each passing month. We just recently reached the $200K mark and I am already getting excited to reach a quarter of a million. (CRAZY!) Take a look at the Net Worth Tracker we use. This is Google Spreadsheet so we both can access it. Knowing your net worth is an important step towards financial independence. How can you grow your net worth if you don’t even know what it is? Update Savings Trackers This is not a necessary step by any means, but it is a fun one, nonetheless. I like to use a visual tracker to see how much we save each month. The Smart FI does this on a simple notebook paper with a different color for each month as he strives to save $100K in 1 year! Debt Free Charts also makes perfect printable sheets to fill in as you pay off debt or reach savings goals! I like to pretend I am creative and make my own in my bullet journal. Maybe one day, I’ll share my “art.” Review Goals Setting goals, monthly, annual, daily, what have you, is fine and well, but if you never look back to see if you met them and WHY or why not, you will never grow to continue reaching more and more goals. It may be luck that you hit a goal or maybe you set the goal too easy for yourself. I usually do this step as I start to plan my goals for the next month so I can work to make more accurate and pointed goals. Analyze Spending Lastly, the BIG ONE! Analyzing your spending for the month. Take a look at our How to Track Your Spending post for a more detailed review of how to track and analyze your spending. Here is a quick overview though. Export to the Expense Tracker I review Mint every Friday to ensure all the transactions are being coded correctly and labels are added. We use the labels to help further categorize our spending (fixed expenses, variable expenses, vacations, etc.). Since I do this once a week, I don’t have too much to update at the very end of the month. From there, I transfer the entire month of transactions from Nate’s and my accounts to this Excel sheet that I use. Once I have it copied and formated in the Excel sheet, I will make any additional adjustments needed. Sometimes I see that we have double-labeled an item or categorized it under an old category. I just clean up the sheet and all the expenses to ensure it is all up to date. Close Out Daily Spending Trackers After a full month of updating your Daily Spending Trackers you should have sheets choc-full of transactions (or hopefully, not). The first step to closing them out is balancing them to the transactions we just exported from Mint. This is a step I find necessary because I am bound to forget some online purchase or a purchase I made where I didn’t get the receipt. To balance the sheets, I look over our variable spending category as a whole and ensure my total balance equals out. If not, I will scroll through all the transactions to ensure I have everything. Not a perfect system, but I can usually suss out the suspects. This is even easier though if you use the Daily Spending Trackers to budget for particular categories. Once you are all balanced, you can review how you did to budget. This is the only way we track a budget so closing out our spending sheets is an important part of seeing if we were under and over those preset budget goals. Review and Analyze Now, for the MOST IMPORTANT TASK! Reviewing your categories, labels, transactions, events, habits. You may track your expenses every day and label everything in such an organized fashion in Mint, but it will get you nowhere if you never step back and look at the big picture. I will usually review this myself, first, to ensure there are no mistakes and have a good understanding of how we did. Include a Loved One Then once it’s all set up, I will review this with Nate. We go over each line together and will ask questions of each other’s purchases. And we will game plan for the next month how we can do better or repeat what worked for that month. This has been the most important aspect of improving our finances over the past two years. And doing it together has made us both feel included and accountable for our results. Summary Phew, that concludes our Monthly Money Routine. We hope that it can provide some pointers on where to start getting a grasp on your personal finances. Just remember, personal finance is personal, so if these steps aren’t exactly for you, change them up, add new ones. It needs to be what works for you and what gets you results! Do you have a different Monthly Money Routine? What would you change? Let us know in the comments!
Christmas is just around the corner which means it’s time to set up your Christmas Budget. We know how easy it can be to spend more than you have but with a budget in place you will be able to get gifts they love with money you have. In all honesty, Nate and I both LOVE Christmas. Both of us have moms that love Christmas and decorate beyond your wildest dreams. And in the past 5 years, I’ve finally started to understand my mom’s excitement for Christmas. Getting the perfect gift for a loved one is the BEST feeling. The anticipation from when you buy it, building up as they pick up the present under the tree, and all leading up to their face of pure joy or shock. It’s a feeling like no other. And although we are on a journey towards financial independence, giving gifts is one of those things we love and will never “squeeze out of our budget.” We just need to find a balanced budget for it. And honestly, if Nate and I had all the money we could ever want, we would be buying some pretty spectacular gifts. I won’t mention them here because Mom reads this and I don’t want to spoil any future surprises. Because we both could just go crazy with Christmas gifts, as I am sure most parents can relate to, we need to set a Christmas Budget for ourselves. Here are the three questions you need to ask yourself (and your loved ones) so you can set your own Christmas Budget. 1. Who’s on your Christmas List? This happens to me every year: a week before Christmas and someone brings up the work Christmas party or a cousin’s new girlfriend, and I have purchased nothing. I have to run to the store in the thick of Christmas traffic (a completely real thing in San Diego) and buy a gift I could have purchased a month ago for probably half of what I bought it for. In order to hopefully prevent all that last-minute shopping and stress, look back to last year’s list to help jog your memory for this year’s list. If you tracked your expenses last year, you can simply look through last year’s expenses (think October – December) and find all the Christmas related expenses. We have a separate line item to track all our gifts named “Christmas Gifts.” If you didn’t, it’s time to start reminiscing, maybe put on some holiday music to put you in the mood. You can look through your calendar for Christmas parties you went to. Remember back if there was a potluck, Secret Santa, or White Elephant exchanges at each. Maybe look through photos if you don’t have all the invites on your calendar. And then be sure to go through all the family members that were at the holiday gatherings. Did you buy something for your boss, co-workers, landlord, neighbors, landscaper, etc.? Here’s our list from last year and there are some definite changes to the list this year! Nate Parents Brother & Sister In-Law Nephews (x5) Boss Co-Workers (x4) Work Secret Santa Work White Elephant Entire Team at Work Alicia Parents Brother Grandparents (x4) Family White Elephant Friends’ White Elephant Boss Co-Workers (x2) Work Secret Santa Work White Elephant (x2) Note: we do NOT buy each other gifts. A) I get too stressed out buying Nate a good gift because he is the best gift-giver ever. B) We see all of each other’s finances so it wouldn’t be much of a surprise. C) We just agreed we don’t really need gifts from each other. That may change, but for now, we are both happy with that decision. If buying gifts for each other is important to you then please don’t change that! Just add it to the budget. Now, don’t forget that there may be new parties this year or new family members (kids, in-laws, new-found cousins, etc.)! And we can go ahead and categorize Holiday Cards in gifts as well. You will need to add the expenses to make, order, and send Holiday Cards if that is something that is important to you! 2. Do I Have Any Non-Gift Categories? Once you have a full list of who you will be buying gifts for this year, it’s time to check your other non-gift categories! Gift Wrap Time to pull out that gift wrap box. I know you have one, everyone does. Will you need to buy more wrapping paper, gift tags, bows, or cards? All these expenses can really add up if you aren’t careful! Just be sure to shop at the Dollar Store or get together with friends to wrap together! Decorations And in the case of both our moms, will you be buying any more Christmas Decorations? We bought our fake Christmas tree last year that we will be keeping for years to come, but it was a rather large expense. So take a look to see if you are wanting to purchase any more decorations for the holidays. Donations The holidays naturally bring out tons of great donation opportunities whether it is buying Christmas gifts for children in need or donating to a homeless shelter so they can prepare a holiday meal. We all want to be able to give back to our community and the holidays are a wonderful time for that. Just be sure to factor this into your Christmas budget so you can set aside the necessary money for it! 3. What Can I Afford? Now it’s time to start looking at the finances of all of your categories. Hopefully, you have some numbers from last year to help guide the budget, but if not, you can just as well go through each category and start with a rough estimate of each person or party. Remember, you will still have all your regular expenses in December. Rent is still due, the heat will still need to be turned on, and groceries won’t magically appear for dinner. You may not be able to afford to cash flow all of your Christmas expenses but you can plan ahead and save into a Sinking Fund. Check out our Sinking Fund Tracker in the Free Resource Library to help organize your spending and saving for Christmas! This is how my mom has always paid for Christmas. She saves a certain amount of money from each paycheck to a separate checking account, just for Christmas. Then when she starts buying Christmas gifts, all the charges will get paid from that account. Mind you, she taught me to do this well before I even knew Sinking Funds existed. And it is proof that it works. She never has to worry about her Christmas budget and never has to worry about trying to cash flow all her Christmas spending at one time. Take a look at what you are able to set aside with each paycheck from now until Christmas (keeping in mind you will need to purchase gifts well before Christmas Day). What can you honestly afford? Set Your Christmas Budget Now combining your answers to all the questions above, it’s time to set your Christmas Budget. Use last year’s numbers as a starting point and hone in on your number for this year. Were you comfortable with what you spent? Did you feel stretched? Did you have to take on debt? How much do you already have saved? How much extra can you save between now and the time you shop? Find a number that is comfortable for you to spend. You’re either going to have to cash flow this or save enough prior to them. You are not allowed to go into debt for Christmas. Repeat after me. I WILL NOT GO INTO DEBT FOR CHRISTMAS! We set a budget for our overall spending for Christmas and then broke it down into categories: gifts (family, friends, work), donations, decorations, etc. This will help us keep a closer eye on each of the categories allowing us to flex spending when and where necessary. Here is our current Christmas Budget, although certainly subject to change. Total Budget : $920 Nate’s Family: $300 Alicia’s Family: $300 Nate’s Work: $220 Donations: $100 Categories we won’t have this year that we had last year are Alicia’s Work, Friends Get-togethers, Decorations, and Gift Wrap. We’re going to try to be a bit more scrappy with our gift wrap this year and not only have less to purchase but less waste, too! Start Shopping Now that you have your budget, it’s time to brainstorm gift ideas within the confines of that budget and starting shopping for them! If you have a great gift idea and it is out of your budget range, you should start bargain hunting by looking for price match opportunities or waiting for sales around Black Friday. Or you may need to compromise on the exact brand, model, color, etc. that you wanted to buy. The earlier you start your shopping, the more flexible you are to find something perfect for the receiver and perfect for your budget! So start early, shop around, and check out Etsy for some handmade treasures at reasonable prices! The worst thing you can do is start shopping too late and have to pay the dreaded convenience fee and miss out on so many great sales! Patience is your best friend. Merry Christmas and Happy Holidays! (almost)
Let’s take a look at our September Spending Report. Every month we like to review with you how our spending ended up compared to budget. We do this to help you compare your expenses as well as learn from our mistakes and successes as we go. Tracking your expenses is the first step necessary to start your personal finance journey and one of the most important, if not the most important. We want to not only enunciate its importance by sharing our monthly expenses but show you that we too can struggle with staying on track and that’s just part of the journey. It won’t be perfect, especially as you start, but the only way to get better is to keep practicing, as with anything. Since we are still in the early stage of FI where we are aggressively saving our money, we want to be able to cut our spending as much (and as reasonably) as possible. The more we cut our spending (on the things we don’t care about) the more we can put towards savings. Fixed Expenses As you may know by looking at our previous spending report, we separate our expenses into a few different categories or labels. The two main ones are Fixed Expenses and Variable Expenses. Fixed expenses are our monthly recurring costs. We break all these down here. These costs don’t change from month to month although they can have variations from time to time. Those variations are what we will discuss below: Disneyland Annual Passes Our passes expired on September 24th and we will not be renewing them for this next year. With the way the payment contract works out, our last monthly payment was in August so there was no payment in September. A benefit of being So Cal residents is that we are able to pay for the pass over the course of 12 monthly installments with 0% APR rather than paying the entire payment upfront. Our monthly payment totaled $97.00 per month for the two passes. With us not renewing our passes, we will be able to reallocate those funds towards our savings (ideally). Read our article about why we decided to get Disney Annual Passes in the first place. Spoiler: saving money doesn’t have to be a life suck and Disney was a great experience for us and our families. Car Insurance Renewal My car insurance plan is renewed annually in September. Previously, I had been on my parents’ plan where they paid the total upfront and they had me pay them back monthly. Thank you parents! This year, however, their insurance required that I be taken off of their plan and start my own. Since I was no longer living at home or in school and otherwise completely independent of my parents, I needed a separate plan. This wasn’t exactly ideal since my parents have been with their insurance company for 26+ years and now I am starting on a new plan from scratch. With less “loyalty” and no multi-policy discount, my car insurance increased from $45 a month to $52. Not a drastic increase but noteworthy, nonetheless as it is an overall increase of $84 over the course of the year, almost two months of my previous payment. The rest of our fixed expenses stayed the same from month to month. Our total for fixed expenses was $1,485.18. That is a $93.96 savings to last month. Yay! Variable Expenses Now, this is where we are able to focus on areas that we have more of an active influence to change. Since we have already analyzed and worked on getting the lowest rates on all of our fixed expenses, we are able to put more of a focus on our variable spending month to month. First, a note on how absolutely terrible we did. It’s not the end of the world because we are still able to cash flow all of these expenses and do not have to roll over any credit card balances. We just weren’t able to save as much as we would have liked to. However, for those of you that have a lot less wiggle room on your budgets and going drastically over budget, as we have, would put you into debt, we highly recommend setting up Sinking Funds. I will point out where Sinking Funds would have made sense for these situations below. Disneyland Trip This was one expense that we had planned for but was still already pushing us over our budget. We decided to indulge ourselves in one last weekend getaway to Disneyland before our passes expired this month. We were able to do relatively well on the budget I had set for the weekend. But anytime our vacation sinking fund isn’t able to cover the expenses for a trip, it ends up eating a large chunk of our monthly budget. This trip cost us $351.67 and I had budgeted for us to spend $320.00 over the three days we were there. We did great in that regard, however, our overall variable expenses budget for the month is $910. With $200 going towards groceries and about $200 more for gas, that leaves $510. With $350 going towards a weekend at Disneyland, it doesn’t leave much room for much else ($160 to be exact). In the future, we are going to have to look further out at our plans for weekend trips and set aside money specifically for those weekends in our vacation sinking fund. Car Registration & Smog Test Another expense that we were aware of, but we just didn’t actively plan for it. We did not set aside any money for registration into a sinking fund as we should have. It would be helpful to be able to easily pay the credit card off with the money from that sinking fund rather than needing to cash flow the $214.22. I also had only anticipated paying the amount due on my registration notice, $125, plus a smog test. I didn’t do my due diligence to research how expensive it would be to go to a local registration shop and get it done there. PS it’s super expensive. Moving forward, I now know that I need to pay and register each car in advance online so they can mail the registration and stickers to you and save on the convenience fee. Zac Brown Band Concert This was honestly a slip into the consumerist mindset that we haven’t seen in a while. We had gotten “free” tickets by using our Hilton Honors points to get Lawn Tickets. We had such a great time, even tailgating beforehand and bringing our own dinner. So far, so good! I had a budget for us to spend $70 inside the venue as I figured we would want a drink or two. And, unfortunately, we just blew that budget out of the water. We ended up spending $125 at the concert. And there was no need for us to do that, we just had one too many beers and were having fun. A lesson learned for sure. YOU DON’T NEED THE $12 TACOS AT THE END OF THE NIGHT! Standard Purchases Utilities Our utility bill runs from mid-month to mid-month. For the bill due in September, it spanned mid-August to mid-September. This is the hottest part of our summer here in inland San Diego and had us running the AC into the evening. And of course from 4 pm – 9 pm, our electric company runs electricity at increased rates. Our bill was $59.98, the highest for the year. Nothing too wild but definitely higher than our average of $32.44. Pet We have a timeshare pup and we pay for her annual flea medication. It is on auto renewal and auto-delivered every year. And every year, Nate is completely surprised when it hits his credit card. We now have this recorded so it won’t be forgotten again next year. This was definitely an unexpected expense and just further hit our budget pretty hard. The total was $104.95. Gas Prices This was one of our only two categories that really saw benefit from our week away. Since Nate wasn’t driving to work every day for a week, we were able to save on one full fillup for the Jetta. This saved us about $40 – $50 and we came in at $172.59 for the month. Groceries Just as we weren’t using as much gas by being gone for a week, we also weren’t eating as much food (from the standard monthly budget). And usually, this is the category that we struggle to control the most. That’s why it’s the only category we have a specific budget for ($200/month). We did great for the month and even though we were running low on food at the end of the month, we were still able to shop the pantry and make it work. We ended up spending $146.75. How our DC Vacation Factored In We had a week-long vacation in Washington DC this month and all the spending that took place on that trip was specifically paid for by a sinking fund. With a separate budget and fund for one whole week of September, that meant only three weeks were being counted toward our regular monthly budget. And yet, somehow, we still royally screwed up. Usually, with our $910 monthly budget, we have 4 weeks to spend, so about $230 a week. This time though we only had 3 weeks to cover with the same $910, giving us $300 a week! We ended up spending $505 per week! Ouch. Looking back, we should have lowered our monthly budget to reflect the loss of one week on a vacation and we should have set up sinking funds to allow us weekend trips and easier car registration payments. All in all, we still didn’t come close to the extra forgiving budget we had set for ourselves. Recap Those first three items (Disney weekend, ZBB Concert, and Car Registration) are what essentially blew our budget out of the water. Had we not had any of these three items, we would have been okay, but that’s not how life works. We knew all these items were coming up and should have planned accordingly. Either by setting up sinking funds for them or by adjusting our spending in our normal categories to help lessen the blow. But as you can see, we did neither and ended up going over budget by $607.18 Fixed Expenses $1,485.18 Variable Expenses $1,517.18 Total Spent in September $3,002.36 Now that you can see our shortcomings and (some) successes with our September Spending Report, it’s time to look through your spending! How happy are you with your September spending?
This month’s money challenge is focused on changing your spending habits. Since October is the calm before the storm in regards to the holiday season, we thought it would be a good chance to implement a No Spend Challenge. Why We Do Monthly Challenges Humans are competitive by nature, especially us. We like to play board games, yard-games, Nate loves Fantasy Football and is always up for some Mario Cart. To help play on that nature and make your personal finances more than just another chore, I thought we could add some monthly challenges to the mix of getting your finances in order. Back in August, I had posted on Instagram that we would participate in Offer Up August. A challenge that pushed us to sell unwanted/unneeded things around the house. The goal was 4 items (1 per week) and we actually went a *little* overboard and sold 34 items in August. What can I say? I love cleaning. No Spend Challenge This month though we are focusing on a No Spend Month It doesn’t have to be as scary as it sounds, even though it is the month of Halloween. But rather than trying to limit all spending for the entire month of October, because honestly, that’s just crazy, the goals is to get 14 no spend days. That’s (technically) less than half the month and completely doable! They don’t even have to be consecutive. For 14 days of October, we want to challenge YOU to not spend a dime all day. Are you up for it? What’s the Point of a No Spend Challenge? It’s not to deprive you of everything you love or make you an antisocial homebody. Instead, it is really about challenging yourself to get creative about how you spend your time and your money. It’s to show you that you don’t need to spend money to have a good time. You should be intentional about spending your money. I know it is so easy to stop by the store on the way home from work to pick up something you just remembered. But if you are more intentional about your spending, you will be able to make a list all week and maybe realize you already have an extra pasta sauce at home or you still have leftovers to eat rather than another fast food meal. Completing a No Spend Challenge is not something we recommend that you do every month for the rest of your life. But hopefully, it will instill some habits in you that will allow you to be more intentional about how you spend your money. And when you’re bored, you know you don’t have to go shopping to fill the time to buy stuff you don’t need or will never use. Tips on How to Manage a No Spend Challenge Now, that it’s time to execute the No Spend Challenge, here are some tips to get you in the right mindset and keep you on track. Have a Visible Tracker This is one of the most important aspects for us reaching any of our goals. If we aren’t able to physically see how our progress is going every day, we most likely won’t prioritize that goal and eventually fail. For this challenge, I have made a No Spend Challenge printable. Check out the Free Resource Library to download your copy. We are posting ours on the fridge and at the end of each day marking whether or not we had a No Spend Day. The small win of marking a No Spend Day will motivate you to continue marking day after day until you reach your goal! Remember you must put it somewhere you will see everyday. On your fridge, in your closet, on your desk. Somewhere that won’t get lost in the day to day craziness. Create a Reward System Another great motivator is a reward system. If you accomplish a No Spend Day, you should not only get to mark a spot on your tracker, but have some sort of reward. For us, we are going to be saving an extra $5 a day that we accomplish a No Spend Day into our vacation fund. Find what is a good motivator for you and how you can find a piece of that to reward yourself each day. For example, you could allow yourself a dessert that day or money towards your beauty, sports, or fun category. Batch your Errands By planning to do all your errands just one day a week, you will be more methodical in what you actually need and where you actually need to go. You’ll be able to save money by having a list and not just running to the store because you need one thing and end up leaving with seven things. Also, by batching your errands, you will save so much time. I don’t know how many times I have gone to Walmart more than once in a week and not only does it drive me crazy but it such a waste of time! I have so many other things I could be doing. And saving time, saves money! Tell People By telling people, you will be held accountable for accomplishing your goal. Even if your friends/family don’t join, at least they will understand that this one month you won’t be going out every single weekend with them. Maybe they will be more willing to plan a potluck instead of going out, saving everyone money! Get a Partner to Join You Going even further than just telling everyone about it to keep you accountable, find someone willing to take the challenge with you. That way you can share tactics and struggles together. If you know your best friend is also struggling to save money, the two of you could plan to spend a No Spend Day together to have fun and pass the time faster! Avoid Temptations If you are planning to have a No Spend Day, don’t tempt yourself by scrolling through Amazon or stopping into Target just to window shop. It’s so much harder to say no when there are items in your hands or in your cart than to just by pass the window shopping altogether. Don’t Cheat with Cash or Gift Cards This is such a hard one for me. Whenever I have cash, I always feel like I’m not actually spending the money. Since it never hit my bank account and I check all my expenses through Mint, it’s as though it never happened. But it did! That was money that I should have deposited into my bank account and should definitely track. So even if you spend money with cash you found lying around or gift cards you’ve had forever, you are still spending money! The point of the challenge is to get creative with how you spend your time and become more aware of how often you spend money. By using cash or gift cards, you are cheating yourself of learning these new habits, however difficult they may be. Stay Busy One of the easiest ways to get through the No Spend Challenge is by staying busy! The more busy you are, the less you have time to even think about spending money. Whether you stay busy with work or by finding fun alternatives to spending money (see the list below), I am sure you will be able to essentially distract yourself from actively trying to complete the No Spend Challenge. Free Fun on No Spend Days Cook or bake Pack a picnic At home movie marathon Go outside (beach, lake, hike, park, etc.) Workout Read Visit the library or a local free museum Scout for Halloween/Holiday decorations around town Go on an open house tour Rearrange the furniture in a room Organize cabinets, clothes, files, photos, etc. Work on the Honey-Do list Host a yard sale (enlist neighbors) Plan a Potluck Game Night with friends Learn a new skill Take photos / videos Write in your journal Extra Challenge If you feel that 14 no spend days is too easy and are looking for more of a challenge then we have something for you. We challenge you to not only have 14 no spend days in October but on the days that you do spend money to only keep it as a must spend item. That means only really spending money on your fixed monthly expenses, groceries, gas, doctors, and maybe some household necessities if you really can’t live without it (i.e. toilet paper, toothpaste). We don’t think the 14 No Spend Days will be easy by any means, but we are going to be taking on this extra challenge due to the horrific scene that was our September Budget. *shudders* Okay to Spend on Not Okay to Spend On Groceries (shop your pantry first) Alcohol Gas Fast Food / Restaurants Utilities / Fixed Expenses (Rent, etc.) Online Shopping RX/Doctor’s Appointments Clothing Household Necessities (Toilet Paper, Soap) Home Decor We want to hear your struggles and accomplishments with this months challenge. Comment below (or on Instagram) how your No Spend Challenge is panning out!
Hi all! We are officially back from our week-long vacation/work trip and wanted to get our DC vacation budget out ASAP. But first, we needed sleep. Lots of sleep. This conference just sucked the life out of us. Especially when we were up until 3:30 am and need to get back to a conference session by 9 am. We had the best time, though, and we are pretty content of our overall spending for an 8 day trip to such an expensive city as Washington DC. Why Washington DC? We actually went to DC for FinCon 2019. This is an annual conference popular among personal finance bloggers, podcasters, YouTubers, etc. and it specifically focuses on media for personal finance niches. Although we found that any niche could honestly come to learn about being an influencer. It was just particularly nice to gather with 2,500 other people that are just as passionate about talking about money as you are! And who actually get what you do for a living or hobby. And the best part was, some people actually recognized our brand “Ticket to FI.” That was one of my goals for 2019. I have NO CLUE how it actually happened, but holy smokes I am proud as hell. Even though I needed to sleep for 5 days straight, we are so excited to go back next year! We already bought our 2020 passes so hopefully, we will see some of you there! Our Schedule The conference this year was a 3 and a half-day event, starting Wednesday and going through the end of Saturday. We didn’t want to only be there for the conference and miss out on so much of the city, so we added an extra 2 full days to the start of the week. We ended up flying in on Sunday and left on Sunday of the next week. This left us 6 full days there, with two and a half days for sightseeing (aka not much). It was such a short trip and yet the longest one we have taken together. We felt so rushed to get so much done in the little time that we had. And at the same time, we didn’t want to push ourselves to the point of exhaustion (which we absolutely did). We basically needed a vacation from our vacation when we got back. And unfortunately, due to our frugal flight choice, did not happen at all. We ended up getting home at 1 am PST which is 4 am on the east coast. And to top it all off, Nate had work bright and early Monday morning. Sorry honey! PTO Hack One great thing about our timing was that it was Labor Day Weekend when we flew out. This paid holiday allowed us to only have to use four days of PTO for the week rather than 5 on any other normal week! A nifty hack that we are able to save 8 full hours for the holidays now. Normally, with most other paid holidays, vacations means traveling with the crowds and getting hit with higher prices for both airfare and accommodations. However, with the week after Labor Day, hotels are usually hurting for business as that is essentially the end of the summer leisure season. Given that we didn’t fly out of Thursday or Friday before Labor Day and stayed through the entire week after, we were able to snag those great deals and avoid the crowds of summer tourism. Trip Prep As we all know, vacations are not cheap. With travel costs and lots of eating out and activities, the bill for an 8 day vacation can make a major dent in your budget and your credit card. This is why we planned ahead for our trip and not only made a categorized budget for what to spend but also saved and set aside all the money we would need for the trip. The only way we were going to be able to pay for this trip was to have money already set aside. So we set up a Washington DC Sinking Fund. We didn’t just hope and pray we had enough money in our accounts to pay off the credit card bills when we got home. We knew we wanted to make it a vacation and actually enjoy our time with good food and drink. To do this, we first set our estimated budget (outlined further below) and then started saving a bit each month. We put this money into a separate savings account just for our sinking fund expenses and have been saving small amounts each month for the past five months. This money came from extra items we were able to sell on Offer Up and Facebook as well as specifically saving 10% of our paychecks towards our sinking fund account. We also have funds set up for some camera equipment and Christmas spending. This allowed us to save $1,431.61 (to the penny) for the trip. And by only going $210.00 over, we were easily able to cash flow those extra expenses from our regular spending allotment of the paycheck. DC Vacation Budget and Spending Now on to what we budgeted and why as well as a break down of how and why our actuals came out the way they did. Airfare One of the most expensive parts of travel is the airfare. Of course, if you are able to take other modes of transportation to the destination then that is awesome (as long as it isn’t too terribly time-consuming like a drive from LA to San Francisco up the 15…). However, for us to travel to DC we needed to travel by plane. So we thought strategically as soon as we decided we were going in February. Nate has been a credit card hacker to some degree for the past five years. He is always more than willing to get a new card if the sign-up bonus is worth it. And this one definitely was. The Southwest Visa was having a limited-time promotion for 30,000 bonus points with $4,000 spend in 3 months AND a free companion pass good through the end of the year! FREE. What that meant is we got a free roundtrip flight to DC for two. We paid 26,266 points for Nate’s roundtrip flight and I was able to join as a companion for free. Yes, there is always a government fee of $5.60 per one way trip, so it ended up costing us $22.40 total to fly to DC. And even though it was the majority of the points we received from the promotion, looking at other times and dates, this was definitely on the low end for a cross-country flight. Airfare Budget: $22.40 Airfare Actuals: $22.40 Trip Running Total: $22.40 Airfare was $22.40, bringing our total for the trip up to $22.40. Accommodations Now the second most expensive part of vacations. With more and more options emerging, there is a whole new segment of accommodations now available with Airbnb, couch surfing, house sitting, and the large influx of hostels popping up. For us though, we stuck with a traditional hotel for this trip due to the fact that Nate works for a major hotel corporation (and I used to). One of the benefits of working in hospitality is the employee discounted rates. They run anywhere from $35 – $55 per night depending on the brand. And even at this very low cost, you still get all the same amenities that come with the hotel, like complimentary breakfast and evening socials. Thanks to this great benefit, we were able to find 7 consecutive nights at a suite property in downtown Washington DC for only $35 per night (plus tax). So instead of paying the lowest rate, I could find for this hotel, $271/night or $2,145 for all 7 nights. We were able to save $1,863 for the same exact room. Honestly, if we didn’t have this discount, we would not have been able to attend FinCon. We knew that accommodations would just kill our budget so we checked this prior to buying our passes. Now, this may seem too good to be true, but this benefit is not always guaranteed. It is solely based on availability and is more often than not, unavailable due to high demand at the hotel. We were so lucky to find a hotel in the location we were looking for, let alone for 7 consecutive nights. That can definitely be hard to find but, again, this was greatly due to the fact that we traveled the week after Labor Day. Accommodations Budget: $281.61 Accommodations Actuals: $281.61 Trip Running Total: $304.01 Ground Transportation This could be car rental, public transportation, rideshare, or even in this crazy world, bike/scooter sharing. Budgeting for Rideshare Transportation Taking a look at the activities we wanted to do, we noted that we were less than 10 miles to all of the places we wanted and needed to go. And since we were in downtown, we know intercity parking is always hard to find and expensive, we knew that we wouldn’t need to rent a car. That said, we focused on ridesharing when planning the budget. Uber or Lyft are easy and convenient methods of getting around a well-developed city like DC. Uber has this ride estimator so you can plan ahead for your trips. This allowed me to plan out the ride from the airport to the hotel as well as the hotel to convention prices. Here’s what that looked like below: Airport to Hotel (Roundtrip): $32.93 Hotel to Convention: $8.27 each way x 4 days (roundtrip = 8 trips) = $66.16 Buffer for Activities too far to walk: ~$50 Total: $150.00 4 Things We Didn’t Account For with Rideshares The estimates were a good start but we were so so far off. We ended up going over by $120.04 just in transportation. 1. Transportation to the airport from home (duh!) We actually park our car at a friend’s place closer to the airport since we are over 30 minutes away. That means we have to Uber from our friend’s place to the airport. I didn’t factor that cost into our budget. It ended up costing us $31.59 roundtrip. 2. Tipping the drivers For all the rides we had calculated prior to leaving, I had forgotten that we always tip our drivers. We tipped an average of $3 per ride and in the budget, I had only estimated the costs of the ride itself. With just the rides I had anticipated, that would have brought our estimate up to closer to the $200 mark ($3 per ride x 14 estimated rides = an extra $42). 3. The weather Originally, I had anticipated us walking to most of the attractions since we were in Downtown DC. We quickly realized that the mall is massive and our slowpoke butts were in no shape to walk the entire thing in two days. We noticed that they had plenty of bike shares on the streets so we downloaded the app and low and behold, they charge about $8 a half-hour! And the scooters were just as expensive as the bikes. We ended walking a ways more and found Capital Bikeshare. They had docking stations all over the city and it was only $2 for every half-hour. They also had 1-day, 3-day, and 30-day passes. Since the hotel was so close to the conference we figured we could ride them to and from the conference instead of using Uber as it would be cheaper and still not take too long. Two 30-day passes cost us $26.00 each and eliminated our Uber allocation for the conference, saving us $14 overall. Until it didn’t. The weather was in the 80s with high humidity and our SoCal selves were not ready for that. We would bike for 10 minutes and be drenched in sweat. Definitely not cool when you are biking to a work event. So we ended up
Hi, everyone. I know we are a bit late to the game as it is now mid-August… but we wanted to review just how we did on our spending last month with our July Spending Report. We plan on putting these out monthly to show you exactly how we are doing. As we know, tracking our expenses is an integral first step in the journey to Financial Independence. If you never know what you spend in a month, how will you be able to cut down your spending to save more? How will you know how much money is needed to sustain your lifestyle without a job? Short answer: you can’t. So not only do we continuously track our spending but we are always working to cut our expenses where we can. Since only 1 of us have a job now, we are trying to save as much as we can. We are up to a 50% saving rate on just one income but the more dollars we can scrape into our savings, the better. It honestly has become addicting. So let’s dive in to what our numbers looked like… Fixed Expenses We have a whole post dedicated to our fixed expenses since they are fixed and don’t change. This way we don’t have to reiterate the same numbers month after month. We did want to note one change in our spending, though. We had originally quoted our monthly car insurance as being $90.01 a month for both cars. I pay my parents $45 a month and Mr. TTF was paying $45.01. For some reason his monthly bill has gone down and there’s no way we’re complaining. He is now paying $41.15 a month! A much appreciated savings of $3.85. Fixed Expenses Total = $1,586.56 Variable Expenses I pride myself on organization and finding the quickest way possible to do something. The following quote explains my process to a T. “I will always choose a lazy person to do a difficult job because they will find an easy way to do it.” – Bill Gates Regardless, we keep our fixed and variable expenses separate so we can focus in specifically on the areas of the most potential for change. We don’t have fixed categories and if a new type of expense pops up in December that we haven’t had all year, we just add in the new line (well, we don’t, but Excel does). For July, we had 16 different categories of spending. They are all included in the screenshot for you and we’ll touch on most of them. Budgeted Expenses We should definitely do a post on how we “budget” but I can assure you it is not traditional. We only have two categories where we hold specific budgets for (and this is likely to change in the coming months to potentially just one category). For the remainder of our spending we have an overall budget and everything else gets added into the total. For now, we can go over our two budgeted categories. Groceries – $213.26 I love learning new recipes and getting better at cooking for the two of us. Without a budget, I could spend hundreds at the grocery store every single time I go. But when I have to stick to a budget, I actually do (at least I try my hardest) to stay within that amount. Our monthly budget is $200 for groceries. It’s definitely tight and not something that is easily done. We often are shopping the pantry and scrounging for food but we have gotten so much better in the past 3 months of cutting our grocery budget significantly. This time last year, we spent $390.18 on groceries! Almost double what we are doing now and somehow we still had about $100 in dining out charges. This month we only went over budget by $13.26! Not too bad. And it is mostly because we had a few unintentional stops to the store for snacks. Chips are our weakness. Honestly, we could eat an entire family sized bag a day if we turned off all our will power. So we broke down a few times and bought them when we ran into Walmart for something else. This is why a LIST helps! even if it’s not for the grocery store. Alcohol – $53.00 So while I am at risk for sounding like a total booze hound, I need to be real with you all because if we need an alcohol budget, I am sure others out there do too. We have started to budget our alcohol spending in the last 6 months or so. And you would think we meant out at the bar or restaurants. Nope. Just the booze you buy at the grocery store and bring home. We could combine groceries and alcohol into one category but we needed a specific focus to cut our spending in this category. That’s the thing with personal finance, it’s personal. If you don’t drink, then you don’t need an alcohol category. If you only think you spend too much on beer, then make a beer category and any other booze can go with groceries or in a completely separate category. For us, we budget $60 a month for alcohol . We were way way over this amount at one point because we were buying craft bottled beer and champagne for every weekend (we also never had plans so we were always home on the weekends). July of last year, we spent $120 on booze for the house. Not saying we drank all that but boy were we spending haphazardously in this category. Now, we are making mixed drinks (thank you Kirkland Vodka) and buying 30 racks of Coors Light. It’s not classy by any means but we get to save more money and still have a fun Friday night together. Plus we NEVER have people over so, I think we’re okay. Regular Spending Quite a few of our categories this month (7) were of our usual expected spending. We’ll break each of those down with the average for the year. Gas – $222.40 Living in So Cal, we have gas expenses. We have two VWs that average in the low-mid 20s for miles per gallon. Not terrible and not the best but we make do. Our average spend per month this year comes out to $263.38. This month we were able to stay below that but not as low as we had anticipated now that only Mr. TTF is going to work each day. However, we still had a lot of driving this month. We took a trip to Big Bear and that brought on an additional 300 miles. I also drove to my parent’s house while Mr. TTF was out of town and that was an additional 200 miles. All in all, I ended up coming in a little less than 200 miles under my old commute (34 miles/day x 20 work days = 680 miles/month), hence the slightly lower gas expense. As I am sure there will still be drives like these in our future, we probably can’t expect too much lower of a gas line item in our future. Personal Care / Home Supplies – $99.50 These are two separate categories in our expense tracker, however they are usually bought from the same stores (Walmart or Costco) and can be used interchangeably for many households. We like to keep them separate to really track the specifics of where our money is going. Our average for Personal Care is $31.29 and we spent $54.11 this month. This was a larger month as everything seemed to run out all at once. This included Shampoo, Dry Shampoo, Face Wash, Deodorant, and Toothpaste. Our Home Supplies average is $32.76 and we spend $45.39. This month the majority of this total came from Costco for toilet paper and tissues. Nothing too crazy but now we shouldn’t expect crazy amounts of spending for these categories in the coming months. That’s what averages are for. Eating Out (Fast Food / Restaurants) – $18.84 This is a confusing category for us. We rarely do go out, especially by ourselves. But when we do, we rack up some large tabs. This can be hard for us to account for in our spending. This month was nothing unusual however. We had only $6 in fast food charges for the late night drive to Big Bear. And then our date night was Carne Asada Fries for a picnic at a vista point. Not a bad month at all. Utilities – $35.59 July is usually the hottest month of the year here in So Cal. I remember last year, the first week of July is when we started reaching the 100s. This year however, was incredibly mild. Even with me home full time, I probably turned on the AC maybe 5 times and last year we had to sleep in the living room under the AC unit at night just to stay cool. That said we saved a butt ton on our utilities bill this month compared to last year’s whopping bill of $212.28. Pharmacy – $18.00 I have a few prescriptions that I get on a monthly basis so this expense is nothing unusual. Luckily it is only this much and actually usually less! Car Wash – $6.00 So quick story: Mr. TTF used to be the WORST with his car’s cleanliness. He basically had stuff falling out of the car if you opened the passenger door. I remember we went on our first “date” (not a date, PS) and I’m pretty sure I had to slide an old bowl of dried oatmeal out of the way to get in. But now that he has a new car (new to him) he has been taking such good care of it and I am insanely proud! We usually get at least one of our cars washed each month. Of course, if it is a rainy month then we won’t go at all. And we usually get the car wash right before we see people, i.e. my parents and they always comment on it. $6 well spent, for sure. Unusual Spending These are our expenses that were a bit different compared to what we expected for the month. Service & Parts – $245.23 We like to get both of our car’s oil changed at the same time when we can. My car can go every 10,000 miles and Mr. TTF’s Passat needs to go every 5,000 miles so we schedule all of mine when his is up every other time. July was one of those months. We ended up spending $52.71 on each car’s oil change with synthetic oil, a great deal compared to our last 3 oil changes. I also had a dead battery! I was frustrated that I need to buy one for almost $150! But given that the lovely, Mr. TTF had to jump the car 3 times in just one week, it seemed necessary. This is obviously our largest expense for the month and to have it unexpected, can hurt some. Luckily we were able to cash flow this due to our style of budgeting with just one large budget and all our categories fitting into that budgeted amount. When startin gout with cutting expenses, we recommend setting up sinking funds for car maintenance expenses. You know how much you drive and how often your cars need oil changes. You can also figure out what expenses can come up with cars and how often like tires and batteries. This way, you can plan ahead by saving small amounts each week, paycheck, or month toward this expense and when the time comes, you will have enough to pay for the entire expense. Pets – $26.80 A small expense that we don’t normally have but we had the timeshare dalmatian for a few weekends and bought a new bag of food and a few toys! A fun expense that we can never