August 2014 Budget

I have been slow at writing this for a good reason.  I am not proud to share with all of you that for the 3rd month in a row my expenses exceeded my income.  I did not include my dividend income this month but plan on doing so in the future (and probably revising past months for this year.)  What is going on you say?  Well lets break it apart as always and see where I saved and where I could have done better.

Needs
As my kids would tell me "Sad face".  This month I am about $600 over budget.  Fixed things like mortgages, home insurance, car loan, braces were right on budget (and aren't going away any time soon.)   Below are the 3 categories that could be variable each month.

Category
Budget
Actual
Utilities
$825
$962
Groceries
$900
$937
Misc.
$650
$1076
Total Over

$600

Utilities
This month in addition to my gas, electric, phone and cable was my quarterly water payment.  That is a whopping $335 dollars or $112/month.  I do budget for this and my sewer payment (also quarterly and coming in September).  How should I show this as it throws off my expenses even though I am saving for it?  

Groceries
I am creating my meal plan and cutting back on eating out to a hand full of times per month.  Even with that I was over my generous new budget of $900.  That is $225 a week on food.  One of my problems is we forget stuff on the list and end up going to the store twice a week.  This may be leading to additional purchases.

Miscellaneous
A massive $426 over in this category.  What the heck am I buying?  Oh yeah back to school shopping which accounted for almost $367 and another $340 to doctor's bills resulting from a few minor family illnesses (my insurance covers nothing but preventative care until I meet the deductible).  I know school happens same time every year so I need to start budgeting for that (and saving over the year for it).  As for the healthcare costs once I build up funds in my company sponsored HSA (Health Savings Account) I will be able to use that to pay for these expenses.

What about Guild Free Spending Money?
Like I mentioned in last month's budget post there is not much room for this at the time.  I have massively scaled back the family fun that costs money opting for hikes and the occasional pizza or chinese.  However this was my wife's birthday month so we did splurge and take a weekend vacation.  All of that quickly added up to $900.  Well needless to say I had to dip into my savings for the last time to pay this off.

I did not add any capital for investing this month.  Still have some cash to invest but I am :-(  Not having good news to share sure does make blogging tough.  I read allot of positive stuff out there but not too much in the "I blew all my earnings this month" area.  Do people like me exist out there?  I think Dividend Swan is in a similar boat.  If you know of any good blogs similar to my story I could benefit from let me know.


Image By supakitmod and courtesy of www.FreeDigitalPhotos.net

Comments

  1. UnknownSeptember 24, 2014 at 11:47 PM

    I just paid over 5k in tuition which really blew my budget!! Keep your head up Dividend Family Guy. Seems like many of your expenses are going towards the right things (health, nourishment, mortgage). In the long run you will have some months in the red, but keep saving/investing and you will be good in the long run.

    ReplyDelete
    Replies
    1. Dividend Family GuySeptember 25, 2014 at 12:07 PM

      Thank you CI! Glad to know I am not the only one blowing my budget.

      Delete
  2. Dividend LifeSeptember 25, 2014 at 12:37 AM

    Hey DFG,

    To steal a common saying; you may have lost this month, but you can still win the year :)

    Definitely include your dividend income; if you're reinvesting directly back into shares each month then you did invest some new capital this month, even though you mention that you didn't.

    I think the value in unexpected expenses is to ask if they were really unexpected? Back to school costs, medical bills and even your wife's birthday surprise should be part of your budget plan for the next 12 months so that you can put some money aside each month for when they come up.

    Possibly you can get some free perks from loyalty points on credit card purchases towards such events (e.g. I get a free night at a Marriott hotel once a year from one of my cards but there are obviously many point schemes including converting points to cash). These can add up to cover cost of meals and what not.

    For quarterly bills that show as "over-spending" in a given month, it's really just a matter of perspective. It's not a bad thing since you've planned for it and even planning for it puts you above the majority of the general population.

    I'm about to buy two flights to the UK to visit my family so I'll be dramatically exceeding my 'travel' budget this month. But it's no big deal, apart from seeing the negative number because I've been putting 1/12 of the cost aside for the last year, so the balance of my travel budget is still positive even though planned budget vs. expenditure will be highly negative.

    Budgeting is really important, it's like your compass on a long ocean journey. You can make a conservative budget and be pleased at having a surplus, or you can make an aggressive budget with the risk of having a deficit. I think it's best to be realistic and put as many expected expenses into it as you can, so you can be reasonably confident about how much money you can save for long term purchases and how much you can spare for investing.

    I'm realizing now after a doctor's visit that my $25 a month towards medical expenses isn't really going to cut it as I have a company sponsored HSA account similar to yours. Likewise my mortgage payment is increasing by $200 a month next month so I'm having to re-budget again. But if it doesn't kill you, it just makes you stronger right?

    OK I'll shut up now - I have a bad cold today which I seemed to have picked up from my visit to the doctor's this week, so I'm a little light headed ;)

    Keep the faith!

    Best wishes,
    -DL

    ReplyDelete
  3. Dividend Family GuySeptember 25, 2014 at 12:14 PM

    hey DL,
    Yeah I was putting just $15 in a paycheck for my whole family. Will have to look at the average for 2014 for all healthcare spending and put more into my HSA come next year. Thanks again for all the advice and encouragement.

    ReplyDelete
  4. Henry @ Living At HomeSeptember 25, 2014 at 4:27 PM

    Bummer, a small setback. At least you're tracking your expenses, that's already half the battle! I was close to paying $4-5k for braces, but decided not to since I don't need them. That would've drained my monthly income and emergency fund for the month. Yikes.

    ReplyDelete
  5. DividendDeveloperSeptember 26, 2014 at 8:56 AM

    Heh, you are certainly not alone in blowing out your budget. My major surprise expense this month was a quasi-spontaneous road trip from Wisconsin to North Carolina to see my girlfriend play in a golf tourney. I have no regrets on going, but it set me back $800+. Oh well, don't let it get to you; next month will be a clean slate!

    ReplyDelete
    Replies
    1. Dividend Family GuySeptember 26, 2014 at 12:02 PM

      Thanks DD for the encouragement. Sounds like a fun trip. I haven't golfed in years. It was getting way to expensive and had to give it up.

      Delete
  6. The Dividend GuySeptember 26, 2014 at 1:35 PM

    Hey!
    I completely understand where you are coming from; I'm a father of three and I generate 80% of our household income - not easy!

    I've set an automatic saving plan for both my savings and my kids education fund. It's like a loan payment now. We all heard about the "pay yourself first" theory but it works!

    I recently decided to cut down on wine and we can only buy 6 bottles per month now (my wife and I really like wine over the weekends! hahaha!). I'm adding another $100 aside in my savings account.

    I definitely blew my budget in September for the same reason (back to school!). Fortunately, October and November are slow month for us (no birthday or any special expenses)!

    good luck!

    ReplyDelete
    Replies
    1. Dividend Family GuySeptember 27, 2014 at 9:40 PM

      I agree on the pay your self first. I was putting money into my savings but then taking it out to pay bills the past 3 months. Hopefully I will get back to "saving" again soon. The holidays are coming fast and that time is always expensive. Thanks for letting me know I am not alone.
      DFG

      Delete
  7. DivHutSeptember 26, 2014 at 10:16 PM

    Over expense/under expense doesn't really matter when looking at just one month. Just make sure this doesn't become a trend. utilities are always an X-factor with heating or cooling costs coming way over our estimates and of course, those nasty "misc" expenses that seem to creep out of nowhere too.

    ReplyDelete
    Replies
    1. Dividend Family GuySeptember 27, 2014 at 9:58 PM

      Misc is my middle name. My poor vacum is broken because all our money is going elsewhere. The wheels and botton are currently held together by duck tape. Hopefully a new one is in the misc. category soon. Wife is not happy having to vacuum with it.

      Delete
  8. No More WafflesOctober 1, 2014 at 7:07 AM

    DFG,

    Don't worry about not having a great month once in a while. As long as your long-term saving pattern is good, you'll be OK. It also seems like you had a lot of one-off costs, which will make saving more in the next couple of months probably a bit easier.

    Keep it up so you can keep investing to rake in those dividends,
    NMW

    ReplyDelete
    Replies
    1. Dividend Family GuyOctober 1, 2014 at 12:20 PM

      Thanks Waffles. I may add the long-term picture to my monthly budget update as well. This will give me both pictures short/long term.

      Delete

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