Wednesday, August 2, 2017

An updated budget for the rest of 2017

This past month my husband received a very small raise, and we decided to apply it toward debt instead of creating new categories in our budget. I've really been trying to practice contentment more often, telling myself that what I have today is enough. Doing this has allowed me to tackle even more areas of our budget and ask if there's a way we can do more with less.

Here is what we're going to try:

Take-home income*: $3,575

Tithe: $474
Christmas/birthday gifts: $25
Mortgage + security system: $713
Water, sewage, garbage: $75
Natural gas: $60
Electricity: $87
Cell phones: $52
Internet: $40
Gasoline: $40
Groceries/toiletries/diapers: $335
Registrations: $15 (this goes toward our annual car registration fees and Sams Club membership)
YMCA: $34 (we are switching to a single membership in September if possible)
Life insurance :$50
Auto Insurance: $62
Student Loans: $1,235
Auto Loan: $294

A few comments:
The biggest cut we will be making is to our food budget. Previously I had it set at about $420 including toiletries/diapers, so this is a cut of about $85. We also have to pay sales tax of over 9% on food here, so I am not sure we will be able to do this, but I'd like to try it out and see if I can be even more intentional with how I shop and how we use our groceries. I still feel like I have room to improve in this area without compromising the health of our family. But if it gets to the point that we are going over budget month after month, I may have to up it just a little. I'm hoping that I can make this work though with a little creativity and better organization.

We are also spending less on gas. Again, I don't know how this will work out, and some months will be higher than others, but I'm hoping that it will average out to this much per month. My husband lives one mile away from his job and can walk or bike to work when the weather is good. I homeschool and often do not leave the house during the week except for a few evening activities. This is an area where we are trying to challenge ourselves to be even more conscientious about the gas and mileage we use.

I would like to cut out our YMCA membership entirely, but my husband really does benefit from having a place to go workout. We have had the family membership for over half a year now, and have used the pool as a family only a handful of times. I have not been once to workout on my own - I usually just prefer working out to videos at home. Because of this, I've asked my husband to change it to a single membership for now. This will save us $240 a year.

This past year we've been putting about $665 per month toward student loans. Now, because we are redirecting extra money from savings to debt repayment, we are hoping to put $1,235 toward the loans. That is almost double the amount we have been paying. Combined with the $294 that we are paying toward our auto loan, this means we are paying over $1,500 a month toward our debt. I am motivated to pay it off when I think about what a difference it would make to our budget to have this money freed up!

There will be some months where we can't put as much toward debt when we have some extra one-time expenses, such as paying for our kids activity fees, or the remainder of our trip to New York, or doing maintenance on our car.

I hope posting these numbers helps other readers get some insight on how our family is trying to hack away at this debt on a modest single income. We are blessed to have lower cost-of-living here especially in the real estate market and are blessed to live really close to my husband's workplace, but other areas have required intentional sacrifices. It doesn't happen magically or easily, but it is doable!

* We also pay health insurance premiums of about $275 per month for health and dental. It is a high-deductible health plan, so we also contribute $150 per month to our HSA. Additionally, my husband has to contribute 6% of his salary to the pension fund as a state worker. All of these expenses are taken out before we receive the take-home pay listed.

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