Forty years ago, at the age of six going on seven, I may have had a month when I spent $10 while only taking in $6. Probably a little less because I think that my allowance was only around fifty cents per week back then when my father started giving me some spending money every Saturday.
More like thirty-seven or thirty-eight years ago when I was nine or ten. That is about when I used to walk myself down to the local convenience store directly upon receiving my allowance and then purchasing packages of baseball cards for a quarter, a Snickers bar or M&Ms for roughly the same price and sometimes both.
As I have previously shared, I am middle aged in addition to being a Middle Class Guy.
In July of 2017, many years after spending a few dollars on baseball cards and candy back in the late seventies, the $6 in and $10 out must be multiplied by a thousand.
Yes, that’s right. For all the advice that I dispense about Paying Yourself First and saving for a rainy day and striving to build a Nest Egg, Yours Truly and company spent four thousand more in July than we took in. I figured that would be the case, considering some whopping expenses that we incurred while taking in less than in many other months.
This will not be an accounting of every dollar spent, but an explanation of how that came to be while at the same time reiterating that the financial goals that I have set for myself and my family have not been taken back one iota.
On the income side, the report is cut and dry. My wife only works during the school year and only a few hours per week during that time, thus I am the only one in the family who made an income this past July.
I did not sell any eBooks, having only one actually published and without a cover, at that. I have done absolutely no marketing of it, so I am always amazed when ten or fifteen people purchase it in a month.
It is one of my preliminary 2018 goals and Resolutions to publish three eBooks, and I count the one that I blithely placed on Amazon about eight years ago without a cover because I did not know how to make one or want to pay somebody to do it for me. Add the fact that it is somewhat of an expose and I did not want anyone to know that I wrote it, so that will have to suffice as my explanation of why it sells so poorly that nobody purchased one last month.
I obviously have to do something to change that, but change is hard for a middle aged Middle Class Guy like me. I am just riding out the next five months of this year, but have ultra-high expectations for the New Year. Many more posts on that to come.
On the expenditure side, we continued spending like it was a month when my wife was working and I sold a hundred copies of my eBook. We have had many months when ten grand left our account, but only a few over the last few years when only six grand went in.
Also, I use the phrase “left our account” because I do not think of all the money as having been “spent.” Spending makes me think of purchasing something or paying bills, but does not necessarily include investing.
Speaking of investing, even though I realized that more money, or energy, was flowing out than in, that did not stop me from continuing investing. Actually, the opposite. Before I paid my bills during July, I made sure to Pay Myself First and also automatically sent $400 to our daughter’s 529 account on the first of the month, same as every month.
Upon the two July paydays, I Paid Myself First, sending $300 each time to one of the two funds in my T. Rowe Price Roth IRA account. $300 went to the Blue Chip Growth fund on the 21st and $300 went to the Capital Appreciation fund on August 4th.
Roth IRA (Middle Class Guy)
|Account Name||Account Number||Available Shares1||Available Balances1|
|Blue Chip Growth – Roth IRA||XXXXXXX||168.435||$15,275.37|
Confirmation Number: XXXXX Trade Date: 07/21/2017
Investment Amount: $300.00
|Account Name||Account Number||Available Shares1||Available Balances1|
|Capital Appreciation – Roth IRA||XXXXXX||493.595||$14,230.34|
Confirmation Number: XXXXX Trade Date: 08/04/2017
Investment Amount: $300.00
I plan to continue writing, and when I write someday about my retirement plan and savings, July was yet another month out of my three and a half working decades that I contributed to them. As you can see, my combined IRA account is still under $30,000. I only started systematically sending money to them last year after reading about Paying Myself First in several books and blog posts.
Our daughter’s college account has much more than this in it, largely because I have set up automatic investments into it for most of her life and they have grown quite a bit.
Like many middle class families, we have a mortgage on our home. We also have that amount automatically drawn on the first of every month, and the amount is about $700, so between that and our daughter’s 529 account, every time that I wake up on the first of the month there is $1,100 less in our account than when I went to sleep.
Being a resident of Crook County, Illinois and not utilizing an escrow account, I must pony up to the Treasurer twice per year and have done so for the sixteen years that we have resided in our home.
As I mentioned in a previous post, our property is taxed at one Benjamin per week. Since Crook County imposes the first installment of 55% of the estimated annual tax, our first installment in the spring was higher than last month’s payment.
However, I did have to stroke a check for $2,324 in the last week of the month, so that equates to about a quarter of the money that went out. That total number was more like $9,600 than $10,000, so the property tax payment accounted for 24% of the funds that left our account if you want to look at it percentage-wise.
There have been several articles over the past year or so about how many families could not easily come up with $500 or $1,000 or $2,000 for unexpected expenses. Although I do not find it humorous that so many families would struggle with this, I do find humor in the notion that I cannot recall ever having had a month without at least $500 in “unexpected” expenses for going on a few years now.
In keeping up with this, we had about exactly $500 in unexpected expenses last month. Even though property taxes take a big and painful chunk of our funds twice per year, it is hardly unexpected. The fact that we also had to pay half of our $1,000 annual premium in homeowners insurance last month also took a sizable bite out of our funds, it was also expected.
What was not expected was that some of our gutters would fall off during a sizable hurricane-like storm with about six inches of rain in one day, and hail to boot.
I am not sure if I should count that as “unexpected,” considering that we have lived in our house since ten days before 9/11 and have never had our gutters repaired or replaced.
Unexpected price of gutter repairs? $300, which is not bad at all.
The other $200 could be considered unexpected. The driver side window of my beater Subaru was shattered, either by the storm or by vandals or by an errant baseball from the field across the street.
I will never know what actually broke it, but it had to be repaired nonetheless.
After hearing the Gerber Collision and Glass jingle on the radio about a million times, I actually called them and it worked out great. I should have called them before the local mechanic, who said that he would price out a replacement but did not get back to me throughout a whole day.
Meanwhile, I was driving with my window taped up and couldn’t see a thing. Not to mention having to explain to a dozen people why my beater car was even more sketchy for a few days without a window.
Final bill, $176 for a new window. Gerber even came out to my Village Hall to replace it while I was at work. Now that’s service!
Vehicle: 1998 Subaru Legacy 4 Door Station Wagon
VIN: XXXXXX Odometer: 128600
License: XXXXXX IL Install Date: 7/25/2017
Install Time: 12:49 PM Installer: MAR
|1.0||FD20268GTNN||Door-(5 Hole,Front,Left,Solar Controlled)||$70.05||$70.05|
|1.0||100 FLAT||100 FLAT LABOR LABOR (Flat Rate)||$100.00||$100.00|
Looking over the statement today, I also saw that I paid $1,100 to my credit card, much of which could be attributed to a short, three-day trip that I took my family on to Milwaukee and then the Starved Rock area in Illinois. It’s not exactly like going to Hawaii or the Bahamas, but our car rental, hotel, meals out, zip-lining and other activities added up to close to a grand. That’s life in 2017.
Wise financial experts will advise for you to spend less than you make. I do not think any of them would advise you to spend $10,000 in a month when you only take home $6,000. Just using crude math, if we kept that pace up, the $7,000 or so that we currently have in our bank account would be depleted within the next two months.
I would not advise it either, and will conclude this with three thoughts about it.
First of all, we do not do this every month. The last time that I posted about our cash flow, we had three thousand more in than out back in May. I hope that this will be the case for this month, although we must start paying private college tuition once again after a two month reprieve in June and July.
Secondly, a one month period of time is not the ideal measurement of our family’s cash flow. Some quarters are even more or less profitable and more or less expensive than others. The best measure for a middle aged Middle Class Guy like me and my family is over the course of a calendar year.
Third and finally for this particular post, I need to make more money. I mean now! I suppose that 2018 would be as good a time as any to find some way to add more to the income side, since the expenditure side shows no signs of slowing. At this point, it takes a consistent eight to twelve thousand to feed the beast of our suburban middle class lifestyle, which is very hard to do on basically my income alone, which does not quite reach that level.
I have expressed my desire to crack into the top twenty percent, but must also consider the prospect that we should stop spending like we are already in it, when we are not.