Well, all of the transfers and credit card payments have been set up for the month, so it’s time to see how I did.
Here’s a look at where my money went this month:
My Honda Civic still has plenty of years left in it (I hope) since it has under 79,000 miles on it. Still, I’d like to have some or all of the cost of a replacement when the time comes, so I contribute $300 a month to this account.
This goal is more than a year away, so it counts in my savings rates.
I put $500 a month in this account to ensure I max it out for the year. My tax refunds (state and federal) were added a few months ago, so I actually have only one more month before I hit my limit. At that point, I’ll keep the $500 back in the business account and put the money in my SEP-IRA.
Retirement is definitely more than a year away, so this counts toward my savings rate.
I put $150 aside each month in anticipation of my semi-yearly premium. Since this goal is less than a year away, it doesn’t count toward savings rates.
Josie will eventually need some medical treatment or other, so I’m putting $100 aside each month until I have at least $1,000 for vet bills. Since this hopefully won’t be needed in the next year, I count this toward my savings rate.
I’m including this one last time, but just to say that, at least for a while, I won’t be mentioning this fund in these updates. That’s because I’ve actually stopped contributing to this fund, since I probably won’t travel again until a friend’s wedding next summer (assuming it’s safe then).
The fund had gotten so large that I actually transferred $1,000 to the general savings account last month. That still left $1,500 in the account, so I’ll have some funds when it comes time to travel again.
These were incredibly low this month because my Medicare premium didn’t get processed in time for the end of the billing cycle. So the total for all five cards was only $395.62.
Obviously, this doesn’t count toward my savings rates, but it is where some of my money went.
Similarly, these don’t count toward my savings rates, but $1,853 a month is a good-sized chunk out of my income, so it’s worth mentioning. This amount includes both halves of FICA taxes, plus state and federal individual taxes.
My mortgage is incredibly low at $599.57. Obviously, this doesn’t count toward savings rates, but it is where some of my money was allocated this month.
Each month, I save $160 from various frugal hacks I’ve done over the years: cutting the cord, switching to Ooma, getting a lower Internet rate, etc.
In addition, over the course of the month I put anything I save via store rewards, coupons and sales for things I would’ve bought anyway. My credit card rewards also go in this category.
The funds go toward an extra payment on my mortgage principal. This month was a banner month, with a total of $325.49.
This amount counts toward the savings rate that includes the additional mortgage payment.
Guest house rent
I rent out the small guest house in the back for $500 a month. Like the saved savings, this amount goes toward an additional payment on my mortgage principal.
I put $200 away each month into this fund. In addition, I round down to the nearest hundred whatever is left after the above amounts are taken care of, and I add that to the EF. For example, $250 would become $200, and that $50 goes into the emergency fund account.
This month, it was $68.21 additional going into the emergency fund. Hopefully, I won’t have to dip into the EF any time soon, so it counts toward my savings rates.
This left $1,900 (thank you low credit card balances!) to divvy up between my savings account and SEP-IRA. My savings account balance is pretty healthy, and I’m focused on maxing out my SEP-IRA again this year (1/4 of my employee pay through my business). So I chose to put $300 into savings and dump the other $1,600 into the SEP.
The business also got some income from various sources, the main chunk of which was a $200 refund from FinCon. After the recent drama, the conference issued refunds to those requesting them. Hooray! So all of that money went into the SEP as well.
Thanks to this hefty payment, I’m less than $4,000 away from maxing out my SEP-IRA with six months left to go. Woot!
Both of these accounts are for the long-term, so they count toward my savings rate.
So that leads us to savings rates for the month. As a reminder, I calculate pre-tax, post-tax and post-tax plus additional mortgage payment. I figure this covers pretty much everyone’s definition of “savings rate.” I aim for 50% for the post-tax plus mortgage rate.
Post-tax with mortgage: 62.5%
So a pretty great month. Some of that is just due to an artificially low credit card balance (since the usual insurance premium wasn’t included). But hey, I’ll take it!
As always, please remember that everyone’s financial situation is different. I make a high salary and have no kids (and no more Tim), which saves a lot of money. And of course, I have that silly-low mortgage, which helps quite a bit too.
So if your results don’t look like mine, just remember that this is probably due more to a difference in expenses than a difference in efforts to save.
I know some of you are still out of work, and others are struggling due to market dips. How’s everyone holding up?