Blogging Away Debt Our Journeys to a Debt-Free Life

by Ashley

Considering the large expenses we had in the month of July, we still managed to do pretty well in most areas of our budget (the primary overage was in “miscellaneous” for the expenses associated with a root canal and car maintenance).

Here is July’s Budget and Actual Spending:

There are three areas where we went excessively over budget:

1. Electricity. It’s incredibly hot, so there’s not a lot I can say here. Our bill this month was actually a little lower because we’ve been having monsoons so the temperature has dropped a little (think…high 90s and low 100s instead of 110s+). We’re trying to be mindful of electricity but there’s not a lot we can do to cut much more in this area. I may need to simply increase our summer budget a bit.
2. Debt Payments. This is actually a good area to spend more in because it means we’re paying more toward our debt! You can see more about our debt in my August debt update post here.
3. Miscellaneous. Only $250/month is budgeted for “miscellaneous” and it is actually divided into four categories. $20 toward entertainment (we only spent $2), $75 toward eating out (we spent $144, but the overage was actually mostly due to our trip to Utah at the beginning of the month; offset a little because we came in under-budget with groceries since we weren’t here for a week and, therefore, saved on grocery shopping). $30 toward personal maintenance (I spent $0), and $125 toward “other” (we spent $1930). We would have been way under-budget in this category if it weren’t for the root canal and car maintenance. As pricey as these were, they could have been worse. $1600 was from the root canal (which I originally thought would be closer to $2000), and the car maintenance was $500, but I used $250 from my “car maintenance” savings (in my Capital One 360 account), so only $250 came from July’s income. If you’re keeping up with the math, that means only $80 was otherwise spent in this category so had these expenses not occurred, we would have done pretty well this month.

One other area I want to draw attention to is the Savings for Irregular Expenses category. Our monthly savings include:

I added to the car maintenance/repair/savings category (increased it from $50 to $100). That’s why the total is now at $440, rather than $390. I’ve had a few comments suggesting we could just save a single flat amount that could be used for any emergency expenses that come up. Rather than “grouping” I tend to prefer the “splitting” method. Of course, if there were an emergency car situation, I wouldn’t hesitate to dip into the girls’ birthday funds (as an example), rather than taking out any new loans. But I like having the money saved separately. Just a personal preference.

Now onto income….

In the month of July we earned $10,420 (after taxes).

Income – Expenses = $10,420-$7998 = $2422 surplus funds.

I took this money, plus the money I had set aside from the month of June ($3200), which gave me a total of $5622. To this, I added $2700 from my checking account buffer (I reduced the buffer since living on last month’s income is, in itself, a buffer).

This provided us with a total of $8322 for the month of August. We are now officially living on last month’s income! Wahoo!!!

So I have budgeted our full month of August. There are still some unknowns (utility bills that haven’t come in yet, precise childcare costs for the month, etc.), but I tried to err on the side of caution. If we have extra money at the end of the month we will put it toward more debt payments.

Here’s August’s Budget:

Any of the bolded numbers are numbers that are exact (for bills already received). I tried to over-estimate on everything else. I’m hoping that childcare will actually be considerably lower than $2,000, but we still owe for two weeks of care from the old place (= $500) and we’re starting at the new place, plus having to pay initiation fees, etc. So although it will still be quite pricey, I’m hoping it will be closer to $1500ish but (again) I wanted to be cautious.

Random aside, our car insurance is going up (boo!!). We haven’t had any tickets or anything so I called to find out why its risen so much (from $90 up to $104!!) and the rep said that all Arizona rates had gone up. What the crap? Seems like everyone is raising their rates these days! (grumble, grumble)

The debt payments are for all minimums with the exception of the car payment (which is over $1500, when the minimum payment is only $411). Exciting stuff! Also note that I’ve removed budgeted funds from the gym line item. When I joined I had paid for first and last month up front so I’m anticipating that this month will be covered from my initial payment when I joined. I’ll still have access for one more month, just no payment associated with it.

So this has taken awhile and I’ve got to get some work done so I need to run!

Hope you have a terrific Tuesday! Thanks for all the helpful comments over the past week!

Ashley

Hi, I’m Ashley! Arizonan on paper, Texan at heart. Lover of running, blogging, and all things cheeeeese. Freshly 40, married mother of two, working in academia. Trying to finally (finally!) pay off that ridiculous 6-digit student loan debt!