35 Months Actually…
Well… Kind of… Remember that if all things go as planned financially, we intend on starting our “step down” process of early retirement in 3 years. Why? Because in 3 years we will own our house outright, and that will give us the financial flexibility to start our travel adventures with some travel nursing and living in a camper, maybe hiking the Appalachian trail… Who knows.
We are going to start a monthly installment of the blog entitled like this one “___ Months Until Freedom!” which will be a breakdown of revenues, expenses, and investments for the month, followed by anything we feel we need to explain in regards to them. As we explained when we started this blog, our intent is largely for our own need to track what we do and what we spend money on so that we can 1) improve upon our own strategy and behaviors, and 2) track our expenses for a period of time that is long enough to give us accurate insight into what our expenses will be moving forward on this road to unemployment. This will be critical since we need to know what our income needs to be to sustain our lifestyle once our income dramatically decreases.
January 2017 Expenditures
First, you will notice that our mortgage, cell phones, and car payments are $0 for the month. Our arrangement with Kristen’s mother for paying her back for what we borrowed for the house ($76,000) does not start until February 1st. Since we both “work for” Rory’s business, our cell phones are part of that contract, therefore you will never see any of our personal expenses paying for our communications expenses. We own Kristen’s truck outright, and Rory’s 10-year-old, 200,000 mile Prius that he bought for $3,500 died last year, so his business was kind enough to buy him a 2015 with 30,000 miles (they managed to get at 1.79% APR through Navy Federal Credit Union) so again, no out of pocket personal expenses for us on that.
Our groceries and restaurant expenses were exceptionally high for us (not starting the year off good) Rory had a birthday party at a Japanese steak house (lots of sushi) we paid for an invited friend, and we had a few more random friend visits that resulted in outings for breakfast rendezvous etc. We REALLY don’t like spending money on eating out so this category burns a little. Even though our grocery bill doesn’t seem high, we are pretty sure it will be one of our larger grocery expense months. Since we do the bulk of our shopping at Sam’s Club, we buy nearly all of our groceries and household items in the same location… And we simply don’t have the energy to separate the categories of what is purchased here. Long story short, this month we purchased large bulk items that are not a true representation of monthly expenses such as toilet paper, paper towels, cleaning fluids, giant bag of rice, dog food, giant bag of 2 gallons of dawn dish soap (2 years’ worth probably) etc. so we feel like we will have to average these expenses over the course of the year to give us a more accurate monthly representation.
You will also notice that we do not have a home heating fuel expenses. Our house uses a pellet stove as a primary source of heat, and our hot water and secondary heat is an oil boiler. We will write a specific blog in the future regarding heating expenses for cold environments, as we have distinct feelings and experiences on these matters, but for the purposes of this blog it is important to note that we pre-buy our oil for the year, and buy 3 tons of wood pellets in the summer in preparation for the winter. Our heating expenses are large, one-time purchases for the year, and we will not have this expense again until the summer if we calculated right this year.
We decided this month to pay the entire year of house insurance ($631) which is the equivalent of $52 a month. When possible we like making a year’s worth of payments so it is one less bill we need to worry about.
Travel is certainly one of our most expensive lifestyle features. This month we bought three tickets to Germany to visit Rory’s family for ten days in February. (Rory’s mom is joining us)
|01/04/2017 (Roth IRA)||$5,500.00|
|01/10/2017 (Index Fund)||$4,000.00|
|January (Kristen’s 403B)||$1,500.00|
|January (Rory’s 403B)||$335.79|
This month we were able to take advantage of not having a house payment, and max out Rory’s Roth IRA for the year. ($5,500) We also hit our goal of contributing $4,000 to our index fund aka “early retirement fund”. Rory’s business is currently in the process of changing payroll and investment services from Paychex to Vanguard, so he is unable to contribute to his 401K plan until April when the plan takes effect (He will need to play catch up later in order to his the max contribution of $18,000 for the year) so this month the total out of pocket contribution to Kristen’s 403B was $1,500 and Rory worked 2 shifts at his part-time job and contributed $335 to his 403B.
We Can Do Better!
We can ALWAYS do better! This month we clearly spent more on restaurants and groceries than we would like to moving forward on average. From February 14th to 24th we will be in Germany, one area we do not like to limit ourselves is on travel, so while there we anticipate to spend more than we would at home on eating out, and miscellaneous expenses. It’s also our anniversary (February 20)… So, we probably won’t have a great episode of Cheapskate Confessions while there. (but maybe… you never know) Still, we want to try to keep the month’s expenses reasonable and will do our best to do so. If nothing else, we anticipate making up for some of the total expenses in our grocery bill, which should be greatly reduced from last month.