Despite some unusual expenses, we stayed well below our monthly budget in November. What are some of these expenses, you say?
Trip to Mesa Verde
Veteran’s day weekend, November 11-12, were free national park days. We decided to take a jaunt down to Cortez, CO to visit Mesa Verde National Park. I hadn’t been there since I was a child and I wanted to take Little Miss TJL since we have previously visited Bandelier and Mogollon cave dwellings in New Mexico.
We have an anthropology professor friend who lives near Mesa Verde, so we were able to simultaneously spend time with a close friend and get the inside scoop on the park.
We finished fixing the leaky roof in our camper ($311). It is a long day drive to Cortez so we stopped midway at Pagosa Springs Hot Springs resort. We soaked ($66) for a few hours before we drove the rest of the way to our friend’s house.
Lucky for us, an elk had been harvested that day! The rest of the weekend was spent dining on freshly processed elk steak and visiting with new and old friends. Plus Little Miss got to learn all about cutting up an animal. She seemed far more interested in eating meat after that experience. Plus she got to show of her knife. I bet the hunters were impressed.
We did make it to the park, but it wasn’t really the highlight of the trip for me, just a cool way to spend the day. The real awesomeness was the beautiful scenic drive, and hanging out with people who get me.
Between groceries and restaurants we spent $134 on food. Usually I would categorize these as vacation expenses, but our spending was so low in November, I just absorb it into the normal monthly spending.
The Last Waltz
The other unusual expense was for concert tickets ($40). The last time I went to a concert was Lollapalooza in 1995. That’s probably not entirely true, but there haven’t been many since.
Every year on Thanksgiving, we spend the morning with friends at their house and they always play The Last Waltz, a documentary by Martin Scorsese about the last concert, held on Thanksgiving day in 1976, by The Band and guest musicians like Bob Dylan, Van Morrison, Joni Mitchell, Eric Clapton and more. This year, being musicians and artists, they decided to perform The Last Waltz.
They organized 20+ local musicians, sold tickets, solicited corporate and title sponsors and produced this amazing collaborative show in about 2 months. They sold out in two days!
The venue was packed and filled with excitement! Within 15 seconds into the concert, over half of the audience was up and dancing. The energy level stayed elevated for the entire 2.5 hours. The electric buzz and joy was palpable. Best $40 I have spent in a long time.
The Expense Report!
In the tables, I produce a monthly and year-to-date summary of expenses, the monthly spending average, and the budget. I keep track of progress and spending behavior. It is much easier to detect any problem areas by keeping careful track of where the money is going.
Summary of November 2017 spending
Green highlighted fields indicate income. We have four sources of regular income; salary and related benefits, rental income, interest and dividends and Mr. TJL’s business income.
Orange highlighted fields indicate expense and are denoted as a negative value in parentheses. Our regular expenses are categorized by monthly expenses and yearly expenses. The combination are our total operating expenses. Additional expenses are paycheck deductions of charitable contributions, health insurance and income taxes.
Blue highlighted fields are our investment and savings contribution.
The bottom line is the balance.
Our monthly budget is tabulated in the far right column.
Our overall income increased in November due to across the board salary adjustments. Did we increase our household spending when we received a raise? Hell no! Any extra money goes immediately to savings.
The art business lost money this month due to commissioned projects still in progress. We expect a little more business income next month. To date, we have over spent by $1,733. This amount is about what we expect to receive from our tax return, so it all works out in the end, right?
In November, we realized a savings rate of 74%!
The Jolly Ledger’s Income Statement
I prefer to manage our finances like a business so I track all sources of income and expense. Below are the details for the monthly summary.
2017 FIRE Progress
I am on-track to retire in four years at age 45. To visualize my progress, I chart my expenses versus my passive income. Passive income is calculated as 4%, the safe withdrawal rate, of my investment balance including holdings in 401k, traditional IRA, Roth IRA, and brokerage accounts.
Due to the contributions and earnings on our investments, our passive income is $1,677 (as of 11/1/2017) per month. In retirement, we expect to withdraw $2,733* per month.
Expenses tabulated in the chart combine the household expenses with the business expenses, so it does not reveal our true cost of living, which has stabilized to near $3000 per month. I am hoping that this level of spending becomes our “norm”.
*Total retirement spending is expected to be $40,000 per year. We will receive $7,200 per year in rental income. Our investments will have to provide us with the remaining $32,800, hence $2,733 per month. If Mr. TJL’s art business provides any income, we will be able to withdraw less, but we are conservatively planning as if we will not make any income in retirement.