Showing posts with label costs. Show all posts
Showing posts with label costs. Show all posts

2014: Review of How We Lived On $34,000

Our household expenses for the year

Another year has passed us by and it is admittedly getting tougher to live frugally. I especially felt like spending money this Christmas season, and felt jealous of others my age (in their 50's) who have houses worth 3x ours, and fancy vacations, and some even retiring. Granted there are plenty of people out there who are also falling into poverty through no fault of their own from medical issues to just bad luck in their careers. We are thankful to be able able to stay the course and hope the stock market continues its steady climb.

We do not make a lot of money, but we both work. But we have managed to save over half of our income and invest in some dividend stocks, peer to peer lending with Lending Club, and ETFs through Wealthfront. As a result our money made more money than we did this year. We have no debt and our retirement portfolio increased by over twenty percent again this year. And it is because we save more than we spend. We also spend less than we make. Both frugal actions are necessary to plan a successful future.  But it is hard, even though the behavior is ingrained throughout life. There are always new temptations and desires so my defense is to always wait on spending decisions. I have to think it through, alot. I once read that you should take a day to think about every $100 you spend. So, it you want to buy a $500 dollar laptop, you need to think about it for 5 days before you spend to determine if you can really justify the purchase. Thats my trick anyway.

So, this year we spent about $34,000 maintaining our lifestyle and household. We track everything on Mint.com and categorize the expenses. Last year we spent $32K. One big expense ($2,125) this year was our dog. She is over 14 now and has developed a permanent case of vertigo due to chronic ear infections and being under anesthetic surgery this year. Our largest expense category this year is allowance and personal care ($4200). We each get $250 a month in allowance to spend or save as we please. If we both do something together it is considered a household expense, but if only one person wants the expenditure it is allowance. I usually buy computer stuff or victoria secret or clothing, my husband buys experiences like auto racing, or massages. Our next largest category is travel ($3661) and it was lower this year than previous years. The third largest expense category was Clothing, Electronics and Miscellaneous ($3611). This was a surprise to me since it didn't seem like we spend much on clothes but I guess we did. This is an area for opportunity to cut back since probably most of it was discretionary and unnecessary.

We did have a couple categories where we managed to cut expenses, one was cable and also phone. We played the mars movie moments sweepstakes and won hundreds of dollars toward our cable bill this summer. We essentially had free cable and internet for four months. We also changed my husbands smartphone to ringplus where he only pays $11 a month for phone, text and data. I pay $50 a month for the unlimited Sprint plan. We still coupon for our groceries and with the changes in Publix coupon policies it has affected our ability to stockpile.

We expect to see our grocery bill go higher in 2015 but still plan to do what we can with coupons. I still will get six newspapers on Sunday for coupons, but I think printing coupons is probably cheaper and there are many of the same insert coupons that available to print. I also want to investigate a way to decrease the insurance costs of our 17 year old truck. We have max coverage and we only drive it 1500 miles a year making it expensive per mile analysis. We need to separate the vehicles and get a separate policy with just minimum on the truck. There are other areas we could cut back but at this point we don't see the need.

The Hidden Costs of Owning A Home

While the actual costs may appear pretty cut-and-dry there are several hidden costs of homeownership which many people don’t even consider when they are looking into buying a home.

Taxes: While taxes are just an annual cost, getting slapped with a several thousand dollar tax bill just for owning your home can be a real shock the first year the tax bill comes due. You might be better suited to figure your approximate taxes and budget for the cost ahead of time so you are prepared when it is time to pay.

Insurance: You have just purchased probably the biggest thing you ever will in your life; you have got to insure it. Insurance is going to be required to some extent while you are paying down your mortgage; it’s also something you should continue to invest in once you’ve paid off your mortgage.

Maintenance: You never know what this could include, but the maintenance is going to be a big strain on your annual budget and could cause debt issues. Whether that’s the trash pick-up, lawn care, fixing a gutter, repairing your septic, upgrading your air conditioning or anything else; you will know these maintenance costs when they arise.

Cosmetics: Another thing that every homeowner will want to do is they will want to improve the beauty of their home. You will just have to tear down that awful dining room wallpaper. And while we’re on the subject the bathrooms could use re-tiling. Of course you will have to improve the front garden and of course the whole driveway has got to be repaved. Once you begin to realize all the things about your dream home which were not as dreamy as you thought when you bought the home, you will begin to see the cosmetic costs begin to rise.

Time: Another one of the hidden costs of homeownership; maybe the biggest, most straining, and least expected of all is time. You spend so much time and effort making your career successful; when you come home you just want to relax and not worry about anything. But when you are a home owner you have to worry about everything.

Of course if you bought your home a few years ago and you’re having trouble keeping up with all these unexpected costs, you may wish to look into mortgage modification. Mortgage modification may not be right for you, but if you can stay in your home by adjusting payments and working out a deal with your lender, it might help you budget better for future costly expenses.  

How To Save Money On Costly Auto Repairs

Taking your car to the body shop for repairs is never fun. You first have to deal with losing your car for up to several days. You then have to worry about a repair that will cost hundreds or thousands of dollars. However, there are ways to save time and money when it comes to your car repair.
Do The Repairs Yourself
There are repairs that you can do yourself if you have the expertise. Instead of going to the dealer to replace a dented quarter panel, you can repair the dent yourself. Some brake jobs and engine repair work can be done on your own as well. Most repair shops charge you more for labor than they do for parts. Doing the work yourself saves you a significant amount of money.
Go To The Junk Yard
Junk yards are great places to find used parts for your older car. They are generally priced to move as well. If you are willing to find the part yourself, you can usually have it for close to nothing. Keep in mind that the junk yard may be the only place where you can find a gas tank for a 1991 Sonata.
Go To An Internet Auction Or Classified Site
The Internet is a great place to find auto parts that people want to part with. Finding a private seller means you won't be charged a ridiculous amount for whatever part you need. Dealing with a seller in your area also means you don't have to wait for the part to be shipped to your home. That will allow you to make the fix much sooner.
Find A Mechanic Looking For A Side Job
A local mechanic who is looking for some extra cash may be willing to do the repair for you at a reduced rate. Perhaps you have a friend or colleague who owes you a favor. Take advantage of the situation to get your repair work done for a reduced price. You may even get lucky and get the work done for no charge.
Auto repair work is a costly and time consuming process. Luckily, there are ways that you can reduce the cost of repairs that you need done. Ask a friend, do it yourself or find cheap parts online. These are three great ways to make sure you are not spending your entire savings on a new radiator.
Bio: Bernard writes in the automotive field. Currently he blogs for Auto Selling Solutions a company that pays cash for your cars in San Diego.