Okay, so you may have noticed, I am not posting monthly income reports anymore. I stopped a couple of months ago. Someone took offense or was jealous and reported me to Google for selling ads that Google frowns upon. So it has become unsafe for me financially to be completely open – sucks, huh? It irks the crud out of me…
Anyway, March was about the same as previous months but our income in April took a hit. A bunch of advertisers are a bit gun shy thanks to Google hits. Mr. BFS and I aren’t starving to death and we can still afford our new home, but we have had to seriously look over our budget. Neither of us wants to return to a commuter job, so we are truly evaluating what we need to be happy – financially and in general.
We had to sit down and make a list of our life priorities. These are the people and stuff that are most important to us right now – we can give up other stuff in order to keep these people and things in our lives.
- Friends (free, yay!)
- Family (free, yay!)
- Dogs ($)
- Jacqui, our housekeeper and friend ($)
- Ben, our lawn guy ($)
- Our new home ($$$)
- Paying off our current home ($$)
- Not having to commute to work (Mental Health is Priceless)
- I like to blog (Makes $)
- Mr. BFS likes sports officiating (Makes $)
- Financial Freedom in the next 10-20 years ($$$)
- Fun – no matter what, we do want some fun in our lives, so we will need fun money ($$)
Tightening Our Belts
We have created a new budget for the next few months until business either returns to “normal” or a new normal is figured out. New notes are in red. Yes, there is almost no “fun” money in this budget – don’t worry, we had already paid entry fees into two Curling Bonspiels (tournaments) in May and August – that’ll be our fun. 🙂
Here is how our budget looks right now:
- Mortgage (
only until May 2012 hopefullyuntil the end of 2012 at least) – $900$505 Roth IRA – $300
- Health Insurance – $315
- Life Insurance– $30
- Car Insurance – $110
- Gasoline – $150
- Electricity – $150
- Water – $30
- AT&T U-Verse & DSL- $140
- Sprint (smart phones and unlimited data) – $140
- Housekeeper – $130
- Lawn Services – $50
Netflix for Us – $10 Netflix for Grandparents – $20(They cancelled this a few months ago though – not our idea or suggestion.)
- Groceries – $300
- Fast Food / Restaurants – $300
- Misc. Bills – $150
- Toll Roads – $50
Car and Home Account – $500
- Joint Entertainment – $50
- Hubby’s Fun Money –
- My Fun Money –
$100 Emergency Fund/Savings – $250 Vacation Account – $50
- Tax Account for IRS and Property Taxes – $400
Cash for Investments – $200
- Cash – $200
- Total Bare Minimum Current Budget =
We are averaging $15,000 a month in 2012 through blog advertising and freelancing . Taxes eat a big ol’ bite though – at least 33% to 40%. All extra money is currently being kept as cash for padding for the new house, new housing costs, and paying off our current home. After we go through closing in September 2012, we will reevaluate and start saving a ton again in Roth IRA’s and a SEP IRA.
Future Costs and Income
Since we are having a new, pricey house built (well, pricey for me…sorry to everyone on the coasts that hate me), we will have an additional $1050 a month for a mortgage and $850 in property taxes, HOA dues, and homeowner’s insurance. That’s about $1900 a month. And our new utilities are expected to be around $300 a month, so that’s about $100 more than now. I’ll just call it an even $2000 extra a month.
That will be on top of the $800 a month we pay now for our current home ($520 for mortgage and $250 a month for property taxes and homeowner’s insurance). That means that in awful months, we could be paying out about $3000 a month for two homes and not making anything.
So we could be looking at $5200 a month as our bare minimum without hardly any savings. And I really would want savings (you know me), so that would be an additional minimum of $500 a month for Roth IRA’s, $300 for the emergency fund, $500 for the car fund, $500 for investments, and at least $200 for fun.
What This Means
That said, my honestly happy number would be a minimum of $7200 a month, so $11,000 in income before taxes. If we need $5200 just to cover expenses in bad months, that means we need to make at least $8,000 to get that after taxes but we’d be saving nothing.
$8,000 – $11,000 a month after blog expenses is very doable but a bad month made us scared.
My Plans to Cover Our Butts
I am not stupid. I know aiming for 5 digits a month is alot. Believe me, we were only making $7000 a year before taxes and benefits less than a year ago. I know. But I also know that we can do it, here’s why:
- We have always lived on a budget, so we can keep that up.
- If we have to cut expenses anymore, we can easily get rid of $300 in extras like cable and Mr. BFS’s personal trainer.
- $1300 a month in rent on our current home is doable – it is slightly less than the comps in the area, so it should go fast
- $600 a month in rent on one bedroom of our new home – very doable, we already have a set of friends lined up
- $500 a month in rent on a second bedroom of our new home – doable, we have one maybe and can branch out
- $300 a month for commenting services – that’s if I do not get any new clients
- $4000 for reffing from September-December – so $300 a month on average
- Paying off our current mortgage would mean $505 could stay in our pockets
That’s a little more than $3800 if we follow through on it all and that’s without even thinking outside the box anymore than we are now. I could always go back to petsitting for $20-$30 a night per dog, babysitting, or Mr. BFS could get a part-time job doing something he likes like fixing the bowling alley’s machines or shelving at the public library.
In short, we should be good even in the bad months like April. And in the great months, we will continue to squirrel away a big part of the extra. But it is always good to have backup options. Always. I never want to be at the mercy of money again. And we should spend towards our priorities. Period.
What are your priorities? What are your financial backup options? How would you make some extra money if you had to?
FYI: I worked at a dead end cubicle job from 2005-2011 for about $30,000 per year. I went self-employed in July 2011 and make between $70,000-$90,000 through blogging, professional pet sitting, hubby's reffing, and our rental home. If you’d like to start your own site (link to my free step-by-step guide), I highly suggest checking out Bluehost (my referral link with a nice discount for you, PLUS a free custom header banner from me!). Please contact me any time at budgetingfunstuff*at*gmail*dot*com with questions or just to brainstorm! I’d love to help!