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May’s Budget Recap, Net Worth Update, & Future Battle Plans

in Our Financial Journey

Whoo-Hoo!

Net Worth Up Another $1,920!  Not Too Shabby!

May was another good month for us, but I’m afraid that the next two or three won’t be as pretty.  In a little over a week, we start our new journey into Australia where for the first time in a long time we will be spending more than we earn.  We have an intense plan to make this arrangement as short as possible as we job hunt down under!

Here are some of the financial events during the month of May for us:

  • We are instituting 3 consecutive “No Spend Days” for the end of this month. That’s why I’ve decide to update the Net Worth and Budget a little early this month.  Our financial situation shouldn’t change one penny, at least until the 1st!
  • My income slowly dwindled away throughout the month. I did a view miscellaneous consulting arrangements, and tied up some loose ends and transferred management of the properties I was taking care of.  Focused on a couple projects that have potential for monetization over the next couple of months.
  • Courtney went back to a two paycheck month. We will receive only one more paycheck in June from her hard work, which we plan to stretch as far as it’ll go!
  • We sold both of the cars. We sold the Nissan 240sx on the private market and finalized the sale of our Alero to a family member.
  • We finished selling a lot of our personal belongings. Courtney made several hundred dollars at local garage sales and online listing portals this month.  Actually we don’t have much left to sell at all.

Overall, it was a fairly average month.  Although we paid down very little on the student loans (mostly due to when the interest/payments hit the accounts this month), we were able to sock away some additional money in savings.  Job hunting in a foreign country is scary, but luckily having our savings on steroids helps calm the nerves.

Potential Problem Areas With Out Budget!

Although we still have around a week left, our successes and failures with our three month budget are starting to become very clear.

  • Grocery [$-172.80] - Luckily the bleeding has stopped here, since we now have enough food to get us by until we leave.  I documented our struggles with our grocery budget on a video post earlier this month.  As I noted, we could have done a lot more in terms of comparative shopping and couponing to help this category.
  • Eating Out/Entertainment [$3.42] – We combined out Entertainment budget into our Eating Out budget, at the beginning of May when it became clear we weren’t going to make it any other way.  I’m proud to say that we staying within this categories’ limits.  My wife received a $30 gift card to a local restaurant as an award for being a great teacher from her school!  This helped us eat out once without having to front the cost!
  • Medical [$-154.48] - Our medical budget took an unexpected hit from dental work that we decided to have done for Courtney.  Originally we hadn’t planned to have this done before we left, but decided to make an exception while we still had insurance through her employer.  In reality, we should have planned for this from the get go, but thought we could get by without it.

Some Of The Categories We Owned!

  • Gas/Oil [$131.99] – It should be noted that we blew a tire out on the interstate which cost $66 dollars to replace.  Luckily, we had given ourselves a little room, in addition to being very diligent about carpooling whenever possible.  We have one more ~$30 tank probably and then we are done!
  • Child Care [$135.00] - $100 of this was a mathematical error on my part when I counted the number of weeks we needed to have Milli in daycare.  The other $35 was for random sitter or two, which we never used.  We were fortunate to have family members that jumped at the chance to spend time with Milli when we needed it.
  • Insurance [$84.71] – Apparently I also miscalculated how our insurance was billed.  I guess we paid over a month in advance technically.  This was down to $12.35 (which is what I expected), but when I canceled our policy effective on our leave date, we were sent a check for $72.36!  Once again, I made an error that benefited us.  I’d rather be lucky than good!
  • Hair [$30] - I’ve been shaving my head for going on a year now to save money.  Recently, my wife has chopped off her hair as well (no, not shaved, just short).  This is mainly for convenience for traveling, but as a side benefit we have far less costs wrapped up in trims and products.
  • Gifts [$60] - We had a couple occasions that came up that were going to require a gift.  Instead of spending money, we decided to give away our stuff.  For example, a friend of ours got married that loves boardgames.  Guess which happy couple got a wide variety of our extensive board game collection?  You guessed right!  We could have sold some of the more complex games, but they will like them and it saves us from having to sell and re-buy a picture frame or kitchen gadget.

Overall, we missed the boat on calculating several of the categories. Luckily, sometimes it fell in our favor.  We did a great job of cutting corners where we could, which I’m proud of.  In the future, I really wouldn’t suggest a three month budget to people.  It did help us keep track of things as the deadline for moving grew closer.  However, estimating the expenses is exponentially more difficult.  I think for Australia we will be sticking to zero-sum monthly budgets.

Future Battle Plans!

With my wife having her last day of school yesterday, we are now in full-bore Australia mode.  Our primary battle plans include securing basic employment and shelter and continuing to build online opportunities.  Once we have a dependable source of income again we plan to lower our savings and emergency fund to knock off a couple of the student loans in our cross-hairs.

Using the Debt Tsunami approach, we currently plan to execute our war on debt in this order:

  • Sallie Mae Scouting Party($1,535.95) (4.21%) – Last debt in Adam’s name, lowest balance
  • Sallie Mae Special Forces – ($3,365.23) (9.3%) - 2nd lowest balance, 1st highest interest
  • Citibank Guerrilla Troops – ($4,999.54) (4.37%) - Lone Citibank debt, similar balance
  • Nellie Mae Airborne Division – ($5,893.90) (7.25%) – Lone Nellie Mae debt, similar balance
  • Sallie Mae Delta Unit - ($3,445.54) (5.875%) – Snowball the remaining Sallie Mae Loans
  • Sallie Mae Gamma Unit – ($7,590.28) (5.8%) - Snowball the remaining Sallie Mae Loans
  • Sallie Mae Beta Unit  -  ($11,299.97) (6.125%) - Snowball the remaining Sallie Mae Loans
  • Sallie Mae Alpha Unit -  ($15467.54) (5.875%) - Snowball the remaining Sallie Mae Loans

How did your May turn out?  Were you able to stay within budget? Did you net worth take you for a ride? Let everyone know by leaving a quick comment below!

{ 15 comments… read them below or add one }

Kosmo @ The Casual Observer May 29, 2009 at 8:37 AM

Overall, May was a pretty good month. Last Friday (coincidentally, on my birthday) was the first paycheck that reflected my annual raise, as well as the cash bonus. (Yep, my company is still giving raises this year.)

We also received a check for $300+ from the health insurance company. An expense that was initially not covered was deeemed to be a partially covered expense.

Of course, then the “check engine” light in the 98 Contour came on. $300 to fix that … still, it has been a relatively cheap car to keep running – much cheaper than a car payment.

FYI Baker – you have a character named after you in my short story today. It’s not just a coincidence.

Kosmo @ The Casual Observer’s last blog post..Lest Ye Be Judged

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Baker May 29, 2009 at 4:29 PM

Funny how you get a raise and then immediately have a bill to use it! The check engine light was coming anyway, so congratulations on the raise!

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Atlas@mymoneyshrugged May 29, 2009 at 8:59 AM

Man Yall are doing it! Keep up the great work! The entertainment and eating out would drive me crazy but I am proud of you guys for rolling your sleeves up and getting dirty!

Atlas@mymoneyshrugged’s last blog post..You Can Achieve the Unachievable

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Kevin M May 29, 2009 at 10:37 AM

Kudos to you and good luck with Australia.

We ended up a little over budget on dining out, but under in groceries. Way over budget on household/repair items due to having our home for sale but hopefully that falls into the spending money to make money category.

Overall we were still able to save over a third of our income, which has me pumped. Our net worth is closing in on six figures which is very exciting. If not for the stock market debacle we’d be there already….oh well.

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Baker May 29, 2009 at 4:30 PM

That’s awesome man! Keep up the good work, I hope to be able to catch that 6 figure net worth someday!

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Neal Frankle May 29, 2009 at 10:45 AM

Hey Mate…

You see…I’m already taking your advice!!!!!

You are a gem as is your blog. Thanks

Neal Frankle’s last blog post..Is College a Waste of Time and Money?

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Baker May 29, 2009 at 4:30 PM

Thanks, mate!

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Brad @ EOD May 29, 2009 at 12:29 PM

Dude I love how you are so good at setting goals. Very organized and I hope to learn some things from you in this area. Setting goals I can do, but keeping them so organized and alive I tend to falter a bit. Thanks for the inspiration and I look forward to watching your progress in the coming months. I am actually excited for you and what you are doing!

Our May budget was okay but we overspent again in the eating out category. We had some relatives come up from Florida that threw a monkey wrench into our original budget plans. I will say that Charlottesville has some of the best places to eat out, so they have been constantly hitting these places up. My wife is very close with her cousin and our children are close in age, so we have been trying to let them spend as much time together as possible. We went to the D.C. Zoo on Wednesday and spent a little more than we planned, mostly because we tried to dodge eating out until after we left the D.C. area but became extremely hungry while at the Museum of natural history. This added about $30 to our costs and only included two bratwursts for Alana and I and a small slice of disgusting pizza for the little guy. All I can say it is a good thing the attractions we did that day were free.

Good luck Baker, to you and your family over the next few weeks and months.

Brad @ EOD’s last blog post..Keys To Effective Money Management – The Introduction

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Baker May 29, 2009 at 4:31 PM

Thanks for the support Brad.

It’s awesome how even though you’ve had some setbacks you are sharing your experience on how you are trying to keep it together. That’s what its all about!

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lakita May 29, 2009 at 2:56 PM

I have a question about the “No Spend Days”….this seems great in theory, but what is to stop you from spending more on the days before or the days after? Have you tracked your weekly / monthly spending to see if it makes an impact?

For example, I would probably buy a “convienient lunch” the day before my no spend day and go to the movies the day afterward :) Well…not really…

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Baker May 29, 2009 at 4:34 PM

I can see your point and there are people who very well might struggle with that.

It hasn’t worked that way for us yet though. Right now it just helps build our commitment to trying to save where we can. For example, a no spend day could potentially help eliminate a quick fast food stop for convenience. You might be more willing to wait until you get home if you have a themed day.

In addition, sometimes concentrating your purchases can also make you more aware. For example, we still needed gas and groceries, but we had already bought these together, when were on our toes. In other words sometimes it’s harder to track spending when it’s spread out and lower amounts.

All that being said, these types of tools and tricks only work well for some people. Some may try them and decide they actually hurt their progress as you have described!

Great point!

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MoneyEnergy May 29, 2009 at 4:03 PM

wowsers, I’m so excited with you guys! That’s amazing…. I love “no spend days” as well. I had three of them this month. Buying the thesis theme for me was a MAJOR outlay and I delayed the purchase as long as possible. So I know what it’s like living on a tight budget when it counts!

Lakita makes a good point above: yes, logically speaking you might still spend more on one of the days before or after – but where it really counts is how often you can do it and whether you can trim your daily spending. We’ll always have the less frequent, bigger purchases every now and then. If you can learn to get by without spending for an entire day, I think it changes your mindset and helps you do it again, and just spend less in general. Like the momentum you can create from going to the gym.

MoneyEnergy’s last blog post..As Canadian Bank Earnings and Economy Go Down, Canadian Dollar is Up

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Paul @ FiscalGeek May 30, 2009 at 1:56 AM

All the best to you and nice work on your focus. I’m proud to say that this month we hit $15,000 of debt paid off since January. We are busting it and sites like yours are certainly helping to keep the accountability… Crikey!

Paul @ FiscalGeek’s last blog post..Find over $1000 in Savings in a Month

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MD @ Studenomics May 30, 2009 at 5:06 PM

Good luck on your journey! I wish I had the balls to move so far away. You need to really get your entertainment budget under control lol. I have been on a roll with the no spend days. Wake up, eat at home, work on my blog for a few hours, go to the gym for kick boxing/weight training, straight to work, and then back home.

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Josh Moore May 31, 2009 at 3:38 AM

Hi Adam,

Great work here champ. Seems like you guys are continuing to gain momentum in accomplishing your goals.

I just broke the $5k in savings this month, which I am pretty excited about. Also have been doing some other exciting stuff the last few weeks (watch this space) that as I will be documenting as I continue to get ahead.

Safe traveling mate, and all the best in getting over here to Australia.

Regards,
Joshua.

Josh Moore’s last blog post..Property investing 101: Gaining some experience

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