My Budget--suggestions wanted

[raeoflyte]

I've been too scared to do this all week, but since I don't know any of you, what the hell--here goes.

DH recently cut back to 30 hours at work, which gives us a good opportunity to revisit/revamp our budget. I've been the house cfo since forever, and I have been encouraging (read begging, pleading, threatening) dh to take the reigns and at least cast his vote with what to do with our money instead of just asking me how much he can spend. I figure if you guys can critique it, we'll have a lot more to talk and think about when we go over things next week.

This was based on living on 80% of our pay. 5% to retirement, 5% to long term saving, 5% to short term saving and 5% to charity, with the plan to increase each with raises, expense cutting etc. Raises aren't happening, and I want to get to at least 10% retirement.

So--what would you do with this budget? DH gets 2 extra paychecks per year that aren't accounted for. I also get a monthly bonus, but it fluctuates. 0-50 in the slow months, can be $250 + in good months. This is where 'extra' comes from for clothes, hair cuts, etc.


My gross earnings (base) per check: 1716
24 pay periods per year
Federal 117
State 47
City 6
SS 60
Medicare 21
401k 86
Dental/vision insurance 30
Life Insurance 16
Health insurance 260
Short Term disability 19
Net earnings: 1054


DH's gross earnings: 1054
26 pay periods per year
Federal 102
State 37
SS 44
Medicare 16
401k 42
Net earnings: 813


Monthly net earnings: 3734

Mortgage 872
Savings account 552

Utilities
Cell 140
Internet 75 (I will call to lower this, it's slow and so not worth that kind of money)
Gas/electric 150 (monthly average)
Water 30 (monthly average)

Medical/Health
Long Term Disability 70
Copays 40 (estimate)
RX 25 (estimate)
Other 100 (Therapy sessions, massage for dh, etc. as needed)

Animals 150 (4 dogs and 4 cats--we're dumb... DH is a vet tech, so we do get everything on a discount. We will not have any pets after these guys pass on. We've already had a life time of pets, just squeezed them all into a decade or so)

Work Expenses
1 data plan on cell 30
Go to my pc 11

Entertainment/Discretionary
Netflix 10
House keeper 180 (Needs to go I know, but I'm having a hard time letting go...)
Lawn care 40
Babysitting 40
Eating out/date night 100
Spending Money

Transportation
Insurance 130
Gas 130
Bus pass 40

Groceries 770 (This is food, groceries, diapers, etc. We're working on cutting this, but probably aren't going to get into extreme couponing just because of time)

We did get a refund last year which surprised us. We have a rental property which can really fluctuate what happens at the end of the year. The property is self sustaining, so I don't get any money from it, but also don't have to come up with extra when repairs are needed.

[Gardening Grandma]

Yeah, I'd cut the housekeeper.
Since DH has 10 extra hours/week, let him do the lawncare as well. Those two things ($240 total) could go towards beefing up the 401K contributions (which look a little whimpy).

Savings account 552
Is that for an EF? If so, how many months' worth of EF do you have?

I'd break down that $700 (food/diapers). How much is actually food? How much actually diapers? How much are other household items? That can be a real eye opener.

Your mortgage payment looks very reasonable. What about property taxes and HO ins? Are they included? Or do you pay them separately?
There's nothing for spending money. Is that allocated from whatever is left?

[Angel!]

I like how much you are sending to savings. Only a few things jumped out at me:

- $180 for housekeeper - nice but not a necessity, can you have it cleaned 1/2 as often & save some money?
- $75 for internet definitely seems too high
- $770 for food/diapers - this seems high to me. How many in your family? Do you know the breakdown between food/diapers/other?

[❤ mollymouser ❤]

I agree with cutting the housekeeper at $180 per month.

Can you cut your cell phone expenses some? ($140 per month.)

Are you actually spending $150 per month on your 4 cats and 4 dogs? What are you feeding them? (Costco's Kirkland brand is considered a pretty decent dog food for the money, for example.) Does this include flea/tick preventative?

Can you swap babysitting with a friend (you sit hers, she sits yours) and save that $40 expense?

If you absolutely HAD to, could you cut or reduce the $100 per month for eating out?

[dancinmama]

I want to say awesome job as I did not see any credit card debt or car payments!!

As much as I know you hate to do it, I'd get rid of/reduce the housekeeper as well. DH needs to help 50/50 by either spreading chores out over the week or having a marathon clean on Saturday mornings. It sucks, but that money is evaporating.

[raeoflyte]

Thanks everyone!

Mortgage is PITI. We're very grateful, but are hoping to save up enough for a dp to move in 5 years. We're not in an ideal school district, and we're off of a very busy street, and have a lot of foot traffic from apartment buildings. Fabulous place when it was just us and critters, not so great for young kids on bikes, etc. That kind of saving obviously isn't happening right now, but I have it in the back of my mind.

The money to savings is intended for long term/short term savings, and charity. We haven't managed to donate a full 5% of our income, but now we do send in money to cause's that our friends are participating in. This is also where we pull money for car repair, dentist bill, holiday gifts, etc. We started this mid last year, and kept up on it really well. This year not so much. We have $4500 in it right now.

I don't have a breakdown of the grocery budget. You all are right, and that needs to be my next priority. We mostly use cloth diapers, just disposables for when we're out, so that is pretty low. We're inheritently lazy people, and we've let that dictate our grocery buying lately. My guess is the price sheet is the best place to do this--just sit down with the receipts every week? We buy organic as much as we can for ds (milk, meat, etc).

Spending money is what got cut with dh's hours at this point. It will also come from my bonus as we move into the busy season. DH needs his own money though, so I want to budget this back in.

We're on the lowest plan for the cell's. DH knows that his data plan is 'fun money'. I use mine for work so that I can work from home more easily when needed, and also respond to emails on the bus etc, so I could cut it, and will think about it at least on a trial run to see how big a difference it is.

We spend $70 for dog/cat food for the month (name brands, but on steep discounts), and $30 for litter/cleaning supplies. We like to budget some extra money for vet bills, pet supplies, but we aren't spending it at this point. DH gets some money from his employer to be used on his vet bills, and last year and so far this year, that is all we've used. All the animals are seniors though, so we know soon we'll have some tough choices, and expenses.

I'll cut the house keeper to every other week as of this week which will drop the bill in half. This is almost better than spending money for me, but I have been really thinking about cutting it out completely. That whole inheritently lazy thing is a real problem...

We don't have any friends with babies near by to trade babysitting with. Our family/friends will do it for free, but since ds has really mastered 'no' recently, we figure we better throw them a bone so they want to come back.

We started the 'no eating out' weeks a couple months ago, where we pick a week where we won't eat out or get take out. It's doable, but it's tough. To do it for a whole month.... Well, we could try it at least! I'll suggest we try it for the month of June.

Thanks everyone--I appreciate the ideas!

[gsbrq]

Good job with the savings!

The "no eating out" thing is hard for me, too. What helps a lot is to have some super easy meals that are your fallbacks for when you just need something quick with no prep time. I freeze extras of things like lasagna, chili, soup, pizza slices, etc, and on the weekends I try to plan ahead all my meals so that I don't have to think about it when I'm tired & hungry during the week.

[❤ mollymouser ❤]

You might try switching to less expensive restaurants, or only going if there's a special, or you have a coupon ~ cold turkey isn't always the way to go, unless you want to!

When you have time, you may also want to look at your insurance and your deductibles ... and see if comparing rates/switching might save you $$.

[phil5185]

First off - your net monthly income is $4392, not $3734. Does that help? (Multiply dh's check by 26, then divide by 12).

But $2640/yr for lawn service & house cleaning? Geeez, you're in your early 30's. LOL, I'm 72, and I can mow my own lawn. OTOH, $10/wk ain't bad, maybe I

should

get a lawn boy?

Your $68,000 gross income is pretty solid, well above the US average household income - so plenty to work with - and the two common achilles heels, multiple late model cars and a 4000 foot mcmansion don't seem to be in the mix.

As for the 15% put-back, there really isn't shortterm & longterm savings categories. Shortterm money (<5 yrs) goes in a savings account, and longterm money should be invested in higher return products (appreciating assets such as stocks & your 2 houses).

I would cap the savings to about $5000 (another $500 from now). And then put 5% in a taxable account and 8% or 10% into your 401k/roth accounts. A $6800/yr contribution costs you about $5000 out-of-pocket. And, if you get company matches, up to $10,200 could getting invested in your names at a cost of only $5000 to you. Ie, a 100% return right out of the box.

The $10.2k/yr invested at 11% is $2.2M in 30 yrs, probably enough for a pair of 60-yr-old empty nesters. Plus you'll have a bunch in the taxable account.

[DVM gone riding]

so maybe I am the only one that thinks this way BUT when you make at/less then what SSDI would pay you WHY pay LTD ins? My LTD ins will only pay out 60% of what I earn and it might be impacted by SSDI BUT I don't have to qualify for SSDI to get it. For me right now that=3700/mos, I am pretty sure SSDI would pay you between 700-1000/mos which is roughly what you are making any way (ea person anyway) Normally I encourage people to have LTD but in your case you might be better saving that away for yourself.

[DVM gone riding]

You have babysitter but not daycare?? How many kids?

[Deleted]

Since I work in the telecom industry, I say BRAVO for spending $140/mo and buying into our vision of supposedly improving your quality of life with a portable device.. ;D But the personal budget side of my brains says - wow.. $140/mo..

[raeoflyte]

Thanks again everyone! DH and I sit down tonight to go through things together.

I've cut the cable internet to their lowest speed--with modem rental and taxes/fees I think it should come in at $40 per month. Will talk with DH about buying a modem for about $50 to drop it another $7 a month.

DVM--We have 1 child who is almost 2. We work opposite shifts, and only have 1 day a week that we need any help with daycare when dh is between shifts and I'm at work. Our parents rotate that day each week at no charge. Our housekeeper will babysit on days our parents can't, or if I'm not busy at work, I can work from home those days. We're so lucky and grateful for our parents. DCP don't want to take a kid for 1 day a week.

On our long term disability insurance--it covers from 3 months to 2 years. I figured a total disability could take about 2 years to negotiate with and actually collect ssdi which is why I went with this one. DH has a physical job, so this also helps us if he hurts himself and is out for 6 months with surgery, etc. I'm not thrilled about the expense, but felt like we needed it once we had a kid. At least until we had a good emergency fund built up.

[raeoflyte]

DH and I didn't get into the nitty-gritty details last night, but we spent a lot of time on our financial goals and how our spending does (or usually doesn't) reflect those goals.

It's hard for me not to get bogged down when the total #'s are so big (saving for a new car, getting pregnant again, house down payment, emergency fund, etc), but as I read on another thread--I think DQ said you just do it $1 at a time, and that is our plan.

We're going to cut the housekeeping to once a month, so from $180 to $45. I'll probably keep lawn care for another month as we tackle some deferred maintenance, but with the goal to take that back over.

Eating out, we'll plan on 1 date night per month, and 1-2 pizza nights during the month. Still tackling the laziness thing, but we made a list of no cook meals that we can keep on hand and know that we are still providing sound nutrition for ds.

My goal for June is to get the grocery bill down to $650. I think I'll probably switch to shopping primarily at walmart for staples, and we have multiple invites from people to tag along on costco/sams trips for meat/produce.

Thanks everyone--I'm sure I'll have more questions along the way, but reading the boards really helps my focus. My sil had set us up to get sod put in our (currently dirt) front yard at a good discount through her job. But weather has meant that they haven't been able to install it. As we talked last night, we decided that we will just seed it, and water it and work on getting a lawn that way. It may take longer, but at least it won't put us farther away from our real goals.

[swamp]

I pay my cleaning lady $140 a month. I would give up eating before I fired her.

[giramomma]

Rae-

On to the "lazyiness" of cooking: Do you have a crock pot? It takes about 15-20 minutes to assemble a dinner. Toss in a salad, and poof, you've got several meals.

If you look at Cooking Light Magazine, they have recipes for cook once and get two different meals sorts of things.

When I used to do the cooking (DH took it over when he became the SAHD), I used to do batch cooking...Making double of something and then freezing half for a later meal. Reheating food doesn't take much effort.

Now, we don't cook every day of the week. But, we will plan a few big meals the gives us leftovers (like we can get two suppers plus a lunch out of taco night) so we don't have to cook.

[Deleted]

Jun 1, 2011 11:08:52 GMT -5 swamp said:

I pay my cleaning lady $140 a month. I would give up eating before I fired her.

I would get rid of cable and cut cell phone to the bone before giving up my cleaning service....although giving up eating would have other benefits...

[DVM gone riding]

oh!! Put in the Sod!! fire the lawn guy and the cleaner but don't do SEED from bare dirt!! been there done that NEVER again, buy the sod and put it in yourself if you need to! I would never go back to trying to seed, seriously still correcting the issues