May was a pretty typical month financially. We spent $3,700 – mostly on fun stuff – and socked away another $10k.
We took an international vacation in May, which was loads of fun times. Our flights and hotels had already been booked, so the only related May expenses were for food, entertainment and merchandise, which can be quite substantial. We spent $1,500 while on our 12 day excursion; that works out to $125/day. Not too shabby. Of course it doesn’t include flights or hotels…
We also hosted a friend in May and did some fun time happy things locally. As a result, our entertainment spend was on the high side. We balanced it with very low fixed (boring) costs on things like our house and cars.
But enough rambling, let’s get specific.
Travel – $1,798: Travel regained its rightful place on top. We took a 12 day jaunt to the other side of the world and a separate weekend car trip. Traveling is the best.
Entertainment – $834: Hobby and Events spending exploded. We did a lot of activities locally in May, and most included food. Instead of trying to break it out between categories, I decided to lump it all into entertainment which means our food spending is coming in low. Six in one, half dozen in the other.
Food – $389: Our lowest month ever is kind of a lie. Since our Events spending includes copious amounts of ruffage we didn’t dine out as much. But really we did, it’s just in a different category… Our grocery spending was legitimately low though, great job us!
Vehicle – $255: Pretty standard stuff. Tolls/Fees is high because I completely forgot about a toll charge in the mail and we were hit with penalties. I should probably try to get it abated, but I really don’t like doing that sort of thing. I mean, why ruin my day?
Home – $183: No mortgage rules! We set a record on our utility spending, I guess not being home 15 days out of the month really helps reduce water and electricity usage.
Other Services – $161: We’re still in the prepaid portion of our DirectTV Now contract. We’ll see this category bump closer to $200 in the near future.
Merchandise – $126: very low spending for the month here. Basically we didn’t buy anything for ourselves. Ok that’s not true, but we did it while on vacation so it goes to Travel 🙂
Our projected 2018 spending stayed relatively flat in May. Entertainment and Travel increased quite a bit while reductions in Food and Merchandise spending offset. I’m hoping we can string together a few strong months and bring this number under $55k.
May is our 3rd consecutive month saving at a >70% clip. That’s awesome. Our major one-time expenses (like property taxes and insurance) are loaded early and late in the year, which presents opportunity in the middle of the year to have inflated savings rates. There are of course 2 parts to the equation, and our steadily high salaries really make it easy to save a lot.
Year-to-date savings took another big step higher. Our general aspiration is a 50% savings rate which we’ve moved safely over for the year. YTD net pay climbed north of the median annual household income in America. It’s not lost on me that we make a lot of money, and we’re doing the best we can to help our future selves in case they’re not as prolific earners.
Our net worth shot $21,000 higher in May! As I mentioned last month, Personal Capital was misreporting one of our accounts so our April Net Worth was understated. It self-corrected in May, but the result is our Net Worth growth is artificially high in May. Oh Well (*shrugs*).
More important than net worth is investment balance. Investment balance is more important to me because it represents money we’ll actually spend some day. Net worth includes the value of our house and I don’t really plan on spending that so….
Our investment balances climbed $10,390 in May and we tip-topped half a mil!
We contributed $5,640 and our employer’s kicked in $1,419.
We max out our 401k’s and I also contribute the max to my employee stock purchase plan, which gets matched. I can’t overstate how important it is to automate savings, if the money flows through your checking account it’s a whole lot easier to save. Of course more important than that is earning a high wage and working for a company that has these types of benefits…. We’re very fortunate in that regard and are just trying to take advantage.
The rest of the portfolio growth is owed to market growth – $3,331. Against all logic and reason, the stock market keeps trundling higher. Our investment strategy is to be invested (very complex), owning low-cost index funds that mirror the broader market. It’s a great strategy when everything is going up.
Also worth noting, we contributed $11,000 to our Roth IRAs right at the end of April. The timing of the transaction is what threw our April portfolio/net worth balances out of whack. Anyway, all is right in the world now.
We plopped $5,500 into each of our Roth IRAs. For a Roth, the money added has already been taxed, but the growth is tax-free. Whenever we make withdrawals, we won’t owe taxes, hurray! Another feature of a Roth IRA is that any contributions you make can be withdrawn at any time, penalty free. (The earnings are subject to age limitations, like a traditional retirement account).
The ability to make penalty-free withdrawals means our Roth contributions act like a de facto emergency fund. If we’re ever in a bind, we can tap into that money relatively quickly. Having a Roth really negates the need to keep more than one month’s worth of expenses in a checking or savings account.
If you’re interested in tracking your Net Worth then you should check out Personal Capital. If you sign up through my link you’ll get super rich and so will I! It’s seriously a great tool and makes tracking your personal finances easy peasy – and best of all it’s free.
May was another strong month for us. Ho-hum.
I sometimes feel like I’m just treading water in life, plodding along without any real ambition. Going through this exercise really helps put things in perspective. I’m healthy, gainfully employed, and have my wits about me. What more could a person want?
But still, lo I want. Not sure what exactly though.
Wanting more out of a life that’s truly charmed probably makes me some kind of asshat. Yeah that sounds right.
Alas, I’m waiting to be zapped.