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Cell Plan, Check. Groceries, Check. What’s Next?

Okay, so I’m in a weird must-cut-all-bills state of mind.

Cuts Already Made

First it was the easy cuts like finding a different electric provider like I do at the end of every contract.  Then it was the harder ones.  Cutting cable and switching to Ting were big leaps for us.  Then we cut biweekly house keeping, which we had for 7+ years.  I thought our heads may explode without our big luxuries.  Now it’s become like a game.  I need to get a real hobby, huh?  ;-)  Let’s look at this piece by piece:

Budget Cuts Made and Future Plans

  • Income Taxes – $2250  Can’t change this…
  • Home Mortgage – $990  Can’t change this right now either…
  • Home Insurance/Property Taxes/HOA – $800  I keep fighting the good fight with the appraisal board, but this is what it is for now.
  • Rent House Home Insurance/Property Taxes – $350  Diddo.
  • Food – $500  Putting a pin in this for right now.  Our potlucks are a main entertainment expense as well as food-heavy.
  • Health Insurance – $320  This was the lowest plan I could find that had anything we needed.
  • Electricity – $150  Switched to Discount Power a couple of months ago since they were at 8.9 cents per k/h.  So far, so good.
  • Gasoline – $150  We don’t drive excessively for fun and gas prices are at $1.83 per gallon here right now.  This is as good as it gets.
  • Car Insurance – $80  This is for full coverage on two vehicles…I can’t find better.
  • Cell Phones – $60  Yay, Ting!
  • Internet (DSL) – $55  WANT TO LOOK INTO THIS
  • Lawn Care – $50 (average over the year)  I’m good with this luxury.
  • Water – $50  Sadly, our public utility district water company is just expensive.
  • Natural Gas – $40  Only one provider.
  • Life Insurance – $30  Solid price for a $250,000 policy on both of us.
  • Medicines – $20  This is better when our allergies behave.
  • Netflix – $10  We use this daily since we cut cable.  And I cannot wait for the new season of Orange is the New Black!
  • Other Entertainment – $50  We generally keep this to $30-ish for a movie night or something, so I may lower this target.
  • Miscellaneous and Cash – $250  Stuff pops up and I think it’s unrealistic to think otherwise…

Next Target – Internet

Looks like the only two categories I really have a shot of changing right now are food and the internet.  I am mulling over getting crazy with our food budget.  This leaves the internet as my next target!  Let’s see if I can find high-speed providers for less than $55 a month…

Overall, I am pretty surprised that there isn’t much more I can do.  I guess once we actually, voluntarily gave up biweekly house keeping, I knew that we were towards the end of our options, lol.  I literally started this post and just ran with it.  I bet if I do find cheaper internet, food may be hit next…

What budget cuts are you looking into?

 

Starting the New Year with this Monthly Budget

A bunch of the financial changes we made, like switching to Ting Wireless, have finally taken effect.  I also now know how much our property taxes and random insurances have increased.  So, here is what we aim for each month now.

PLEASE KEEP IN MIND – this is just our targets for monthly expenses.  We have savings goals too, like fully funding each of our ROTH IRA’s each year.  That money comes from whatever we can make above and beyond our expenses each month.  Our average monthly income is around $8000, but that can be as low as $6000 one month and as high as $10,000 in others.  That’s just the fun of self-employment, hehehe.

Our Current Monthly Budget

  • Income Taxes – $2250
  • Home Mortgage – $990
  • Home Insurance/Property Taxes/HOA – $800
  • Rent House Home Insurance/Property Taxes – $350
  • Food – $500
  • Health Insurance – $320
  • Electricity – $150
  • Gasoline – $150
  • Car Insurance – $80
  • Cell Phones – $60
  • Internet (DSL) – $55
  • Lawn Care – $50 (average over the year)
  • Water – $50
  • Natural Gas – $40
  • Life Insurance – $30
  • Medicines – $20
  • Netflix – $10
  • Other Entertainment – $50
  • Miscellaneous and Cash – $250
  • Total Expenses = $6205

As you can see, more than a third of our monthly expense total is put aside for estimated quarterly taxes.  Another third is for housing (our house and our rent house).  But I do like the fact that the $2140 we spend monthly on housing is countered on the other side with $1850 in rental income.

My Thinking

I’m glad we’re cutting expenses.  I’m thankful to still be self-employed – I truly enjoy our autonomy.  I’m happy that we have four different income streams – online, rental, pet sitting, and sports officiating.  My long-term goal is to actually raise our monthly expenses by a whole other rental home (and hopefully raise our monthly rental income by a slightly greater amount).  My 15 year goal is to pay off our current mortgage and any further mortgages and cover 50% or more of all of our monthly expenses with rental income.

I’m happy with our budget, happy my hubby is behind it with me, and happy with life in general right now.  It’s just one of those times that you feel extremely grateful…

Hope you are doing well!  Hope your budget is too.  :-D

My Christmas Budget – Things Change and They Remain the Same

J Money’s post about his budget from years ago inspired me to look up my past too.  My husband and I set a budget of $500 for Christmas for the last 4-5 years, and we generally do pretty well.  The main difference has become that we used to hang out with 20 or less people including family…now it’s 35-40.  I consider that an amazing life change.  But it has changed our shopping habits.

Christmas Budget

Our Christmas Budget in 2011

We spent $510 on our families and friends in 2011.  There were 18 people – 9 family members and 9 friends.  If you do the math, those numbers mean that we spent an average of $25-$30 per person.  There were some $40-$50’s and some $10-$15’s, but we definitely spent more per person back then than now.  It helped that it was a great financial year.  That was the year that I went self-employed, still had a classic day job for 6 of those months, and my husband was a public school teacher.  I had very little time away from the computer, but I was excited about a new path.

Our Christmas Budget Now in 2014

This year, we have spent $470.   There are 35 people on our list – 12 family members and 23 friends.  More friends is a “problem” that I am so thankful to have.  :-D  It just takes a little extra planning and some serious thoughts on people’s inner wants, lol.  These numbers mean that we are now spending an average of $13.50 per person.  That’s about half of what we used to spend on each person, yet I think our gifts are more thoughtful and will be better-received.  I’ll let you know if I’m wrong.

We made some of our gifts, splurged in some places, but also found amazing deals right before Black Friday.  Honestly, the 30% off at Think Geek, Groupon Good sales, and good deals on Amazon accounted for the majority of our gift list.  I also made beer bread and Mr. BFS mixed up some homemade spice mixes since one of our friends needed stuff to fit in a small living space.  About $40 was spent on little extras here and there like stocking stuffers.

How has your Christmas budget changed over the last few years?

The Budget Cuts Finally Happened…

I posted that we were making $500 in budget cuts in early June 2014, yet by September 2014, we had only cut cable.  I had been procrastinating on switching to Ting wireless from Sprint.  Well, here is how our monthly budget is looking now:

Our Current Monthly Budget

  • Income Taxes – $2500
  • Home Mortgage – $990
  • Home Insurance/Property Taxes/HOA – $750
  • Rent House Home Insurance/Property Taxes – $300
  • Health Insurance – $275  $320
  • Car Insurance – $85
  • Gasoline – $200
  • Life Insurance – $30
  • Electricity – $150
  • Water – $50
  • Natural Gas – $40
  • Restaurants – $250
  • Groceries – $250
  • Cell Phones$150  $75
  • Medicines – $20
  • Internet (DSL) – $55
  • Housekeeping – $175  $0
  • Lawn – $50 (average over the year)
  • Netflix – $10
  • Hulu Plus – $10
  • Miscellaneous – $200  $150
  • Entertainment – $50
  • Cash – $100
  • Total Expenses = $6435

Monthly Income

Our total income each month fluctuates, but here are our monthly averages in 2014:

  • Online Business – $6250
  • Rental Income – $1800
  • Pet Sitting – $800
  • Sports Officiating – $600
  • Total Average Income 2014 = $9450

Fluctuations

Self-employment is inherently risky to some degree.  We diversify our income to help alleviate as much of that risk as we can.  Our lowest month this year has been around $7000 in September, and our highest month was more than $11,000 in October.  We attempt to keep our expenses set based on the “bad” months so that the “good” months can be used for savings, investments, and padding.

Our expenses fluctuate too, but as you could probably see from the budget, we are sort of locked in at around $6000 a month.  That just covers the income taxes, property taxes, home owner’s insurance, life insurance, health insurance, mortgage, utilities, and $350 for food.  I price check those expenses annually to grab up the best deals.

Based on our general lower average of monthly income in 2014 as compared with 2011-2013, our income taxes should decrease at least a little in 2015, which will help.

Using the Extra

Our main retirement priority is to fully fund each of our Roth IRA’s for a total of $11,000 each year.  We are saving any further extra to either buy another rental property of to pay off our current home faster.  Adding another property now (and even more in the next 10-15 years if possible) may end up leading to ongoing income streams that could possibly fully fund our retirement. I do enjoy that idea…

About 10% of the extra is also set aside for travel and fun since life is better when you budget in the fun stuff too.  ;-)

Actually Saving the Savings

After following along with J Money’s Challenge Savings Account updates, I have been inspired to do the same thing.  J Money has opened a savings account that is solely funded by what he is “saving” by cutting expenses and from selling stuff on Craigslist.  He decided to really save the money and squirrel it away for at least a year just to see exactly what can come out of making simple budget cuts.

Right now it is at $195 for the 3 months of savings from cutting cable.  It should grow pretty quickly now that we’ve also switched to Ting (should save at least $50 a month) and are cleaning our house ourselves (will be saving $175 for the months we do this).  I’ll also see what we may want to sell on Craigslist, although I don’t seem to buy cool things to resell from garage sales like J Money.  ;-)

We’ll see what happens by September 2015…

How is your budget working out? What are your future plans?

Our Monthly Budget Update – Some Cuts Made

I posted that we were making $500 in budget cuts in early June 2014, yet they just started.  It took us longer to cut cable than I had expected and now we are reviewing everything to make sure that we are content with our budget as it is now.  Let’s see where we stand…

Our Current Monthly Budget

  • Income Taxes – $2500
  • Home Mortgage – $990
  • Home Insurance/Property Taxes/HOA – $750
  • Rent House Home Insurance/Property Taxes – $300
  • Health Insurance – $275
  • Car Insurance – $85
  • Gasoline – $200
  • Life Insurance – $30
  • Electricity – $150
  • Water – $50
  • Natural Gas – $40
  • Restaurants – $250
  • Groceries – $250
  • Cell Phones – $150
  • Medicines – $20
  • Internet (DSL) – $55
  • Housekeeping – $175 (average over the year)
  • Lawn – $50 (average over the year)
  • Miscellaneous – $200
  • Entertainment – $50
  • Cash – $100
  • Total Expenses = $6670

Monthly Income

Our total income each month fluctuates, but here’s a quick general rundown of our monthly averages in 2014:

  • Online Business – $6500
  • Rental Income – $1800
  • Pet Sitting – $1000
  • Sports Officiating – $550
  • Total Average Income 2014 = $9850
Crystal's Budget Meme

I just created this meme at Meme To Go!  The ecstatic, awesome Pug is Maggie, one of my pet sitting “Happy Campers”. :-D

 

Prioritizing the Difference

That monthly average of income has fluctuated by up to $1500 depending on the month, so we don’t tie up the extra as much as we did in the past when our income was a little more stable.  To be really clear, our monthly extra has ranged from $1000-$3000.  The $3000 months felt like mini-miracles, but the $1000 months felt pretty tight with a pinch of worrisome.

Lately, we make sure to fully fund both of our Roth IRA’s ($11,000 a year total) as quickly as possible.  In the last few years, we’ve been able to do that within the first half of the year.  The rest has been squirreled away towards a car fund, an emergency fund, a rental property maintenance account, a cash account for future investments, a home account to pay off our current mortgage faster, a joint vacation/fun expense account, and our personal fun money accounts.

Cash Options

You may notice that having accounts for all of those goals means that most of what we are squirreling away is actually in cash.  We don’t particularly want to keep quite that much cash on hand instead of invested since 0.75% is a crappy rate of return, BUT we are saving as much as we can this year to see what we truly want to do with it in 2015-2016.  Plus, during our worst months in 3 years, having cash on hand kept us from totally and completely freaking out.

I already bought a new car, but since it’s at 0.9% for 5 years, we will probably not use the car account to pay it off early.  I think we could use the investment cash, the car account, and the home payoff account to put 20% down on yet another rental home.  Land lording isn’t all rainbows and butterflies, but it has become a nice income stream for us.  Even after property taxes, insurance, and normal maintenance, the extra is making a significant dent in our own mortgage payments for our current home.  Adding another property now (and even more in the next 10-15 years if possible) may end up leading to ongoing income streams that could possibly fully fund our retirement.  I do enjoy that idea…

If we don’t go the rental home route, we may simply invest more cash in our Scottrade stock investments and see what happens from there.  No matter what, I know we want to spend the majority of our saved money to make us more money.  A small percentage of it will probably be used for further vacations since I seem to have caught the cruise bug and always seem to be looking for the next awesomely cheap deal.

How is your budget working with your current expenses and income?  What are your future plans?

New Orleans on a Budget

As I mentioned yesterday, I was in New Orleans last week with my husband and a couple of our friends.  I’ll be going back in September for the 2014 Financial Blogger Conference.  I figured I could help a few of us out by posting how we can visit New Orleans on a budget.

New Orleans

Transportation

For this last trip, we drove to New Orleans from Houston, TX using our 2007 Prius.  Altogether, it cost $60 for gasoline.  If you live close enough to drive, it may be something to consider.

If you can’t drive, check out your public transportation options.  I’m using the Megabus in September to get to New Orleans and my mother-in-law is picking me up.  The 1-way Megabus ticket cost me $9.75 and that includes the upgrade to the best seat and the 25 cents to receive text notifications of any changes.  It looks like most tickets cost $2-$50 depending on the location and whether you need a round trip ticket or not.  Check out your local bus and train stations to see if you have any affordable options.

For flights, you may want to figure out the direct flight cost from your city OR look at flying into a different airport and then finding a cheaper route from there.  For example, it may cost $400 to get from your city to New Orleans round trip, but it may only cost $200 to get to Houston and back and another $100 to get from Houston to New Orleans and back.  It pays to look at all of your options.

Lodging

The FinCon14 hotel this year is a Marriot at 555 Canal Street.  It’s running about $150 a night with taxes.  If you need to save money, you should consider splitting the room.  You can cut your hotel bill in half or more depending on how many of you decide to bunk up.

Another option is to stay somewhere else and either walk or drive in each day.  I generally use Priceline or Hotels.com to research my options, and then I go directly to the hotel’s site to see if there are any specials or AAA discounts.  My hubby, friends, and I stayed at the Best Western Bayou Inn in Westwego, Louisiana and drove the 20 minutes in each day to New Orleans.  The Best Western was $80 a night and we shared the room with the 4 of us.  Each couple only ended up paying $160 for 4 nights.

The drive in was easy and we parked at Harrah’s Casino.  Their lot costs the same as other parking near Bourbon Street, unless you gamble for 30 minutes.  So we signed up for their free casino card program (like at Kroger’s), plugged the card into a penny slot every day before we left for our hotel, made a few inexpensive bets over 30 minutes, ordered a few free drinks right from the screens while we waited, and ended up getting nearly free parking all week.

Harrah's Casino

The parking is across the street…

Food

New Orleans has amazing food, but it was a little difficult to find inexpensive options.  There’s always fast food, but that is sad to eat on vacations.

We ended up settling on finding restaurants with generous portions and splitting them.  For example, Deanie’s Seafood has a $56 fried seafood plate that can easily feed 5 or 6 hungry people – it’s HUGE.  They also sell a half seafood plate for $29 that you could split 3-4 ways.  Oh, and they had giant bowls of delicious soups and bisques for $9 (cups were $5).  My husband and I split a bowl and were very full plus we had leftovers.

If you are in the mood for a fun class plus delicious food, you can pay $22-$25 per person to learn from and eat at the New Orleans’s School of Cooking.  The class takes a couple of hours since you are watching the demo of how it’s made the whole time.  If you need something faster, Harrah’s had a deli and a Fuddruckers inside that ran about $8-$10 per person.  There’s also an Arby’s right next to the #FinCon14 Marriot.

If you are willing to walk, Café DuMond is about 10 minutes away and costs $2.42 for 3 beignets or a cup of coffee or hot chocolate.

Beignets

Yep, there were 3 beignets there right before I took this picture…but they told me to eat them and I obliged.

There were dozens of restaurants along and around Bourbon Street too.  They all seemed to run $8 per person on the cheap side up to $20-$30 a plate.  But if you are walking around with the right group of people, you can have a lot of fun finding yummy food that you can afford.

Fun

People watching was the ultimate free fun.  We walked around a lot and took a ton of pictures of the historical buildings like St. Peters church.

Church

We also enjoyed taking our time at the penny slots at Harrah’s and drinking free cocktails (although we did tip $1 each).  Altogether, a week of gambling for about an hour a day cost us $55 for tips and gambling, but it got us about $80 in free parking and more than 14 mixed drinks overall.  I have found out that I adore Fuzzy Navels…

For a great deal, although not technically “cheap”, you can spend $40 0n the Audubon Experience Package ticket.  That one pass will let you into the Audubon Zoo, Aquarium, Insectarium, and Imax once each over 30 days.  That’s $10 per activity, which is well worth it.

New Orleans Aquarium July 2014

I’m the one holding the cell phone in the picture. How cool is this view?!

Overall, a visit to New Orleans doesn’t have to break the bank.  Just pay attention to all of your options and choose the best deal for you.

Budgeting for Unexpected Expenses – Istanbul and Italy

Quick background:  I host monthly giveaways via my newsletter.  Readers enter by first signing up to receive my weekly newsletter, and then by leaving a comment on my giveaway post.  I ask for that comment to be a question for me if they have one.  Random.org chooses the winner each month.

Reader Question

Here was a recent question from Carmen:

My kids have gifted me with a ticket to Istanbul & then Italy for my daughter’s wedding in Autumn…what is the best way to budget for additional trip expenses?  Thanks–take care!

Okay, so most of us are probably thinking that the best way for budgeting for unexpected expenses is to save money in advance.  You’d be right, but that isn’t helpful if that hasn’t been done yet and the expense pops up anyway.  Plus, that may not be the question…

Travel on a Budget

How to Estimate Travel Expenses

First thing’s first.  Carmen may be asking how much she should budget for the trip, not how to come up with the money.  Either way, she’ll need to know.  For travel, I generally search around online for recent personal stories from other people to see how much things run.  I research them based on the big categories and round up to cover anything I may have forgotten:

  • Hotels/Where You are Staying
  • Food
  • Transportation
  • Planned Fun

As a fun example, I actually researched the general prices of Istanbul and Italy to help Carmen out.  I don’t know any more than any of you do about her trip, so these are just general targets.

Istanbul

I found an Istanbul Travel Guide at Leave Your Daily Hell that says that a hotel will run you $55+ per night, but a hostel would be between $15-$30 a night.  Based on that same post and a 2013 Trip Advisor forum post, it looks like Istanbul runs about $75 a day for everything else including food, transportation, and fun.  You can eat cheaper and visit less museums and save even more.

Italy

According to this 2013 post on Slow Travel Italy, you may spend between $300-$425 a day in Italy depending on how fancy your hotel is and where you eat.

If you want to spend less, check out this Walks of Italy post about cheaper options.  I love the idea of staying in an agriturismo – an old farm house that offers you fresh made meals and they range from rustic to luxurious.  Most often they cover your room and breakfast and dinner for $70 or less per night (50 euros).

Then you just have to worry about your transportation around Italy, your lunches, and what you want to do for fun.  Getting around by train is an option that costs about $30 for most trips.  You could also rent a car, but that looks expensive.  You can grab lunch for less than $25 a day and then budget what you need to for fun based on where you go.  You can easily stick to a $150-$200 a day budget if you want to splurge a little but not a ton.

Budgeting for Unexpected Expenses After the Fact

Overall, it looks like you will want to budget for about $150 per day for your trip and you can bring that down by cutting back in whatever category you see fit by hunting around for less expensive options.

Cutting Expenses

The only way to save up extra money for something like this is to either cut expenses or increase your income.  You can cut your expenses by taking a close look at your spending – first get rid of the easy stuff and then put yourself on a strict spending plan for the categories that you want to cut back on after the easy stuff in handled.  We recently cut down our budget by $500 mainly through a stricter food budget and less fun money.

Make More Money

You can make more money in a bunch of ways, but the ones that pop into my mind are generally side hustles and hobby jobs since selling stuff is a one-time fix and generally, I like my stuff or I wouldn’t still have it around.  I also like having roommates since it’s pretty easy side income without a lot of hassle if you find the right person or people, but that is also more long-term.  Short term, look into summer jobs.  I made a whole list of summer jobs and hobby jobs last week.  I’m personally bringing in about $750-$1200 a month through pet sitting.  Babysitting and house keeping are always in demand too.

Hope this helps, Carmen!  Does anybody else have some ideas for her?  Please chime in!