Year of Frugality: Month 8 Update

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August saw the end of our families "mini-retirement." as I returned to work. It has been quite a change, but the school year has gotten off to a great start, and I enjoy my classes. My wife has even brought the girls to the school a couple of times to visit. 

In the middle of the month, our daughter was baptized. This life event caused multiple family members to visit. It was great having so many people visit for the birth of our child and the baptism. Our daughters are blessed to have so much family that care about them. This visit from family from Nebraska also called for a trip to the beach. 

Once again it was great trip making lasting memories! That was pretty much our August, family time and Daddy heading back to work. Now, let's take a look at the spending report.

August Spending Report:

  • Auto: $250
    • Gas
    • Tolls
    • Defensive Driving
  • Cash: $0
  • Clothing: $32
    • Work pants
  • Dining: $319
  • Daycare: $0
  • Donations: $100
  • Entertainment: $273
    • Tickets for Nebraska game
    • Purchased a new Fitbit for my wife
  • Gifts: $0
  • Groceries: $569
  • Health & Fitness: $32
    • Supplement
    • YMCA Prorated Monthly Fee
  • Household: $223
    • Lawn Mowing
    • Beach Towels
    • Household Cleaning Supplies
  • Insurance: $390
    • Homeowners Insurance
    • Auto Insurance
  • Medical: $362
    • Copay for both of our Daughter's Appointment
    • Payment of a bill from the birth of our daughter
  • Mortgage: $956
    • Interest
    • Taxes
  • My Kids: $206
    • Diapers
    • Wipes
    • Breast Pump Supplies
  • My Pets: $43
    • Dog food
  • Utilities: $815
    • Streaming TV Service
    • Internet
    • Water
    • Natural Gas
    • Cell Phones
  • Vacation/Travel: $208
    • Dog Boarding while on vacation
    • Gas for Trip to Laredo
  • Work Expenses: $111
    • Purchased School Supplies for my classroom

GRAND TOTAL: $4,889

Our lowest spending month this year was August. Why was this? Because our income decreased with my wife on maternity leave. Her PTO (paid time off) ran out and we are living on my income plus her short term disability pay. Because of a lower income, we budgeted our money accordingly and kept our spending down.

It was helpful that the kids stayed home and we had ZERO daycare costs. It also helped that we lowered our grocery expenses. I went a little crazy in July purchasing meals to make for the family. We didn't need all of them in July and they transferred over to August. This allowed our early grocery bills to be cheaper.

We saw our electricity bill jump due to summer heat. We saw our eating out continue to be kind of high. This may be our toughest category as a family. We like to eat out at least once a week. At a $200 budget, that's $50 a week, but for some reason we can't keep it to $50 a week. Thus, our eating out budget has jumped to $300+. 

Below is a look at our spending over the course of the entire year:

With the low spending in August, we have decreased our average spending to $7,266. A decrease of $400 from July. A continued decrease is the goal as we head into the homestretch of the year!

AUGUST SAVINGS RATE:

2018 Savings Rate Goal: 30% 

  • January Savings Rate: 21%
  • February Savings Rate: 16%
  • March Savings Rate: 32%
  • April Savings Rate: 26%
  • May Savings Rate: 20%
  • June Savings Rate: 30%
  • July Savings Rate: 30%
  • August Savings Rate: 26%
  • Year-to-Date Savings Rate: 26% (No increase from July)

We stayed on pace with our yearly average at 26% of saving in a month. March, June and July have helped bring the average up. I still believe 30% is attainable this year! It won't take much to increase our savings just a little bit!

In August, some of our savings was put in emergency reserves and most of our savings was thrown at the house, as we continue to strive for mortgage freedom.

DID WE STAY AWAY FROM BUYING ANYTHING NEW IN AUGUST?

August sees our family return to a buy nothing new challenge. From the data, it doesn't really mean buy nothing new. It's really just an arbitrary goal to reach. Since the beginning of the year, we have purchased at least one new thing every month. Things have come up, but I would like to reach a 0 in at least one month this year. We only have 3 months left, because we bought some new items in August (seven to be exact).

What were the seven items that derailed our goal?

  • 1 Pair of Jeans
  • 1 Pair of Khakis for Work
  • 3 Bottles
  • 2 Beach Towels

By the end of last school year, my jeans were in trouble. I went to three Goodwill stores. I looked and looked and looked for some jeans in my size at Goodwill. I couldn't find any and decided to buy a new pair of jeans at Walmart.

Chris at Keep Thrifty mentioned this about buying used. They didn't expect it to be so hard to find clothes in the proper size. Well, I found his statement to be very true in this situation and I ran into the same problem when searching for some khakis. 

In terms of the 3 new bottles, we ran into a minor sickness with our oldest daughter while we were in Laredo visiting my wife's grandmother. We decided to take our oldest daughter to the emergency room. Thus, I had to make a run to the store to purchase bottles so somebody could feed our youngest daughter. The beach towels were totally unexpected as we forgot to bring some to the beach.

  • January: 34 (No Restrictions)
  • February: 2
  • March: 7
  • April: 1
  • May: 8
  • June: 57 (No Restrictions)
  • July: 31 (No Restrictions)
  • August: 7
  • Total: 147

A sickness, forgetfulness and the inability to find used pants in my size. Sometimes you can't avoid the purchase of a new item, the important thing is that we are being intentional about our purchases!

MORTGAGE PAYOFF UPDATE:

We began the year by setting a goal of paying off $20,000 of principal on our mortgage. We have crossed a little over the halfway mark after August. My best estimates show us coming up short in reaching our goal as we have only paid off nearly $12,000 in 8 months. That leaves 4 months and we need to pay down around $2,000 each month (normal principal payments and extra).

2018 Principal Payments (includes scheduled payments plus any extra principal payments):

  • January: $1,942.65
  • February: $1,147.58
  • March: $1,250.44
  • April: $1,152.81
  • May: $956.43
  • June: $1,958.82
  • July: $2,013.69
  • August: $1,468.71
  • Year-to-date: $11,891.88

The extra $500 paid in August has increased our extra principal payments to $4,250 over the course of 2018. This has decreased the amount still needed to meet our goal to $4,204.07. With four months left, that's an average of $1,051 per month (extra) that needs to go towards the mortgage to meet our goal!

REACHING THE FINANCIAL SUMMIT, STARTS WITH YOU!

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