Expense/Income Tracking

Here is a breakdown of my expenses for May.

My May expenses were pretty low, but I didn’t quite make my goal of keeping my expenses under $1000 a month.  The main budget killer this month was my entertainment expense.  The main reason for it being high was that I included the purchase of my bike and bike accessories as entertainment.  My bike only cost $15.  Buying a helmet, car carrier, bike tools, and a spare tube added quite a bit more to the total cost though.  If I follow through and ride my bike regularly this will be money well spent.

The health cost was a little higher than usual because I had a dentist appointment. I might have another dentist appointment this month which would keep this expense category high.  I plan on having a lot of dental work done so this will be an expensive category in the coming months.

My transportation cost was unusually low. My only transportation expense for the month was gasoline. The gas expense was kept down by using cash back from my credit card. This month I have to buy six months of insurance and renew my car registration so this category will go way up.

My expenses this month will probably be up slightly since I have an over $200 car insurance bill to pay. I’m also taking a three day vacation in Las Vegas. Most of that vacation has already been paid.  If I don’t do well at the poker tables though, the vacation could get a lot more expensive.

I didn’t put any money into savings in April and I did not take any money out of savings in April leaving me with a 0% savings rate for April. I could have made a token contribution to savings in April, but since my future income is uncertain I decided not to add to my long-term savings. It makes more sense to keep the money in my checking account now and I can transfer it over once I have a steady source of income again. I don’t want to transfer money to savings and then have to take it right back out again.

My SWR rate for April was basically unchanged at 39.23% compared to 39.05% the month before. My goal is to get the SWR down to 4% so the lower my SWR is the better. That goal is probably many years from being met. The 4% SWR translates into having 25x your annual expenses in savings or 300 months of expenses in savings. Once I reach that point I will consider myself financially independent.

I have 30.59 months of living expenses saved which is basically unchanged from the 30.72 months of living expenses I had saved last month. I calculate my safe withdrawal rate by dividing the average of my trailing twelve months of expenses by my total money saved. When I don’t add any money to my savings the only changes to my SWR and months of living expenses saved are from my investment performance and the average of my trailing twelve month’s of expenses going up or down. My investments stayed about the same in April, but my monthly expenses were a little higher than usual causing the average of my trailing twelve month’s of expenses to go up. That average going up caused my numbers to be slightly worse than the month before.

I won’t be adding any money to my savings in May either because I still don’t have a stable source of income. I’m hoping that my investments perform well and I can keep my monthly expenses fairly low so I can improve my numbers even though I’m not adding to my savings. To make significant improvements though I’ll need a steady stream of income so I can put more in my savings. I’m hoping I will get another job this month or early next month.

Here is a breakdown of my income for April.

Note: This is an updated version of this post since the first one I published somehow included the information from last month’s income post rather than the new information I wrote for this month’s post. This will be my best attempt at reconstructing what I originally meant to post.

April was a pretty good month for income since I received three paychecks.  Unfortunately, those were my final paychecks from my tax job which is now finished for the season.

Online income is still decent, but my affiliate income has completely dried up.  I’m not sure if I will make any affiliate income this year.  Affiliate income and blogging income are no longer a priority for me though.  I plan to experiment with a couple of different ways to make online income this year.  More on that when my plans come closer to fruition.

My income from dividends,Mr. Rebates , and other alternative sources of income remains small.  However, since I’m able to keep my expenses so low this small source of income still amounts to about 10% of my expenses which I think is a significant contribution.

My prospects for income this month aren’t so good.  It appears unlikely that I will get a job and receive a paycheck before the end of this month.  I do plan on selling some stuff this month, but I haven’t done too well at that yet.  I’m not too worried though since I have plenty in savings and I am confident I will be able to bring in a decent income again soon.

Here is a breakdown of my expenses for April.

My April expenses were higher than I like.  I spent $380 on repairs for my car or I still would have made it under the $1000 level for the month though.  My food bill was a lot higher than normal due to eating out while I was traveling for my hike.  My actual travel expenses were low at $28 since I was able to get most of my expenses reimbursed by my Capital One Venture card, my Southwest Visa card and my Barclaycard Arrival™ World MasterCard® – Earn 2x on All Purchases. That isn’t bad for a 12 day trip with 2 hotel stays, 1 hostel stay, a commuter train ride, two taxis, an airport shuttle, and a plane ticket. This was also the first month that I had to start paying my student loan which keeps my fixed expenses higher than they were.

I think May should be a lower expense month.  The transportation expense will go back to normal and everything else will remain about the same as in April. The only exception to that would be the entertainment expense which will go up in May since it was artificially low in April due to using some gift cards and being gone on my trip for half of the month.

I think I could have a good shot at getting my yearly average monthly expense below $1000.  I do plan on having some dental work done though which will likely ruin my chance at having the lower expenses.  The dental work has been put off for a while though since I couldn’t afford it the past few years. It is more important to get my teeth healthy now than to keep my expenses below the $1000 level. Even with the dental expenses I think I will have respectably low expenses for the year.

In March I made $2959.78 and saved $2300 for a savings rate of 77.72%.  That savings rate is artificially high due to my having some extra money in my checking account at the end of February that was added to my savings in March.  Plus I took advantage of two different bonus offers from Motif Investing and Kapitall that added $100 to my savings and will eventually add approximately $100 more.  If you would like to sign up for Motif to get the $100 bonus leave me a comment and I’ll send you an email with a referral link. You do have to invest $1000 and make at least one trade to get the bonus.  Also, I will get a $100 bonus for referring you.

My safe withdrawal rate decreased to 39.05% from 42.89% the month before.  This is the first time I have gotten my SWR into the 30s.  It would be nice if I could get my SWR into the 20s before the end of the year.  As the SWR gets lower it gets harder to make progress though.  I’ll need to keep my income up, my expenses low, and my savings rate high for the rest of the year to get the SWR down to the 20s.   My ultimate goal is to get my SWR down to 4%.  That goal is probably many years from being met. The 4% SWR translates into having 25x your annual expenses in savings or 300 months of expenses in savings. Once I reach that point I will consider myself financially independent.

I now have 30.72 months of expenses saved compared to 27.97 the month before. Since I am only working half of this month I won’t be able to add a lot to savings.  I do believe that I will still be able to get my SWR down a bit and my months of expenses saved up a bit.  May and June of last year were both big expense months.  I’m hoping that May and June of this year will be low expense months.  I base my average monthly expenses and my SWR off of my trailing twelve months of expenses.  So replacing two bad months in my trailing twelve months with two good months will help lower my average monthly expense quite a bit and it will also help improve my SWR even if I don’t manage to save much money in the next couple of months.