Author Topic: Case Study: Feeling like we are behind!  (Read 4731 times)

familyof5

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Case Study: Feeling like we are behind!
« on: February 03, 2018, 08:57:04 AM »
Hi all! I need help figuring out where we are at in the game of life. I feel like we are doing ok, but also feel like we could be doing better. I feel like we are behind on retirement and savings. I’d love to know your thoughts on how we are doing.

So, here’s the breakdown.
Family of 5 - I am a SAHM, husband works full time, 3 kids - ages 9, 6, & 3. Husband and I are both 33.
We have no family help for childcare or anything like that. No foreseeable inheritances. 
Our house is worth $475,000. We owe $263,000 with 17 years left on the mortgage. That’s about $212,000 in equity. We live in a pretty high cost of living area of Colorado. 
We have no debt besides our home - already paid off student loans and our cars. We carry no credit card debt and only use it for husband’s reimbursable travel expenses for work.
About 6 years ago, my husband had a company fail and we lost all our savings, so everything we have has been built since then.
We budget using YNAB, and it has worked great. We are one paycheck ahead in budgeting. Below are approximate averages of spending in each category from YNAB over the last year.

Assets
Current Emergency Savings - $10,500
Current Retirement Savings - about $55,000 (split between current 401k, ROTH IRAs, and traditional IRAs from previous employers)
2 paid off cars - Subaru for the husband & a Honda van for me
Home - Worth $475,000. Owe $263,000 (17 yrs left). $212,000 in equity.

Gross Income - $120k/yr ($10,000/mo)
Health insurance & benefits: $540
401K contribution (matched by company): $500 (Edit to add: Company matches 100% of first 3% of income and then 50% of next 2%)
Withholdings (taxes, SS, etc): $1890

Net Income - $7075/mo

Set Spending
Mortgage - $1994 (this is higher because we chose to refinance to a 20 yr loan and pay it faster. 17yrs left)
Phones - $109 (2 cell phones)
Car Insurance - $92
Life Insurance - $100 (for both of us)
Utilities - $110
Internet - $68
Water/Trash - $100
Netflix - $11
Preschool - $410 (This is 2 half days per week. All childcare is SO expensive here. This is necessary for my mental health, to get a break.)

Variable Spending
Groceries - $1200 (We have food allergies and I am a dietitian by training, so high quality food is really important to me)
Restaurants - $350
Kid Stuff - $200 (including dance class & other activities, school fees, clothes, etc for 3 kids)
Babysitter - $75  (One date night out per month)
Medical - $200 (Copays, medications, doctor visits, supplements & such. I have some health issues.)
My money - $100 (Clothes, haircuts, yoga class, coffee out, etc. Sometimes overspend to $200)
Husbands money - $100 (Sometimes overspend to $200)
Personal Care - $100 (diapers, makeup, razors, shampoo, lotion, etc etc)
Fuel and Parking - $150
Family fun - $50 (going ice skating, on a day trip, museum, or whatever)
Marriage Therapy - $125-250 (expensive, but necessary…)
Household Maintenance/Updates - $150 (yard supplies, paint, fixing this or that, chicken feed)
Household Decor & Goods - $150 (decor, cleaning products, toilet paper, etc)
Housekeeper 1x/mo - $85 (mostly covered by cash from stuff I sell as we minimize things)
Yearly Expenses/Sinking Funds - $400/mo (Christmas, CSA membership, car registration, COSTCO membership, Birthdays/Gifts, Zoo membership, etc)
Savings to Emergency Fund - $400/mo (Sadly, sometimes a portion of this gets taken from the budget for overspending in other categories)

We budget out every penny, so all of that equals essentially our net income. 

One other variable is that my husband *may* get a bonus this year around $5000, and every penny of that will go to fund and max out his Roth IRA. I didn't include that because we are not sure how much or when it will be since he is relatively new at his current company.

My question: Again, I mostly just feel like we are spinning our wheels, and I would love input. I feel like I have no frame of reference to know if we are doing ok or terrible. Sometimes I feel like we are doing pretty dang good, and other times I freak and feel like we should be much further in the game. I am not sure how to balance living life and enjoying it since we are debt free, or not spending a penny because we should have more in retirement. Should I chill the F out, enjoy life and say, "Hey! We are doing alright!" or say, "AH! We will never retire at this rate!!". Or somewhere in between? I’d love some input!
« Last Edit: February 07, 2018, 08:57:56 AM by familyof5 »

Knitwit

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Re: Case Study: Feeling like we are behind!
« Reply #1 on: February 03, 2018, 09:26:13 AM »
At a quick glance, it looks like you are only saving $500 a month towards retirement. That's not very much if FIRE is your goal. It's great that you have no debt, but I think you could improve your savings with little effort. $1550 a month for food (groceries/restaurant) for 5 people is way too much. I understand the desire for wanting high-quality food, but right now you are spending an average of $50 a day on food. Actually, I just noticed you also have a CSA membership, so your food cost is even higher! There are plenty of threads on this forum with ways to trim your grocery budget; have a look at some of those to start with.

familyof5

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Re: Case Study: Feeling like we are behind!
« Reply #2 on: February 03, 2018, 09:34:26 AM »
Thanks Knitwit! Yes, I agree. According to YNAB, the summer months where we have our CSA veggies coming in, groceries dropped down to about $1000/mo (still high, I know). What I posted were the averages over the last year. Last month I was able to get our groceries down to $1100 (not a huge savings, but it's something) and I'm aiming for $1000 this month and $250 on restaurants (including the 1 date out)... still a lot, I know, but less than we have been spending. Hopefully I can continue to get it down month over month!

Carrie

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Re: Case Study: Feeling like we are behind!
« Reply #3 on: February 03, 2018, 09:36:02 AM »
You've got several places you can cut, but first I want to congratulate you on being debt free (except the mortgage).
1. Eating out + family fun + personal allowance + date night + preschool + housekeeper = all things that could be on the chopping block, or at least trimmed. I'd keep the preschool (I do), but eliminate the eating out & housekeeper.  Or drop the allowance to $25/each. I don't tend to pamper myself though, so those would be easy for me.
Think outside the box here. Could date nights be after the kids are in bed, gazing at stars from your back yard? Are there ways you can do child care sharing with friends? How about batch cooking to eliminate the need to eat out?

wordnerd

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Re: Case Study: Feeling like we are behind!
« Reply #4 on: February 03, 2018, 09:41:48 AM »
You don't state your goals. Is early retirement in the cards, or are you just looking for financial stability? You have financial stability and are doing "fine" by conventional standards. Compared to a lot of the budgets around here, you have a lot of fat to trim. But until you define your goals, no one can tell you whether this is going to get you there.

Even assuming you're on the conventional retirement track, I'd kick up the retirement contributions. Right now, you have about 0.5x annual income in retirement savings, which I do think is a little behind for age 33, according to mainstream financial wisdom.

My suggestion would be to set a goal of maxing out the 401k (so $18,500 in 2018). So that will be about $12,000 more a year or $1K a month than you are saving now (actually less than that because they're pre-tax dollars, but close enough). So, how do you find $1000 a month?

As Knitwit suggested, thoughtfully examine your food budget. I get that yours will be higher than average, but be honest with yourself. Could you achieve the same goals with $500/mo less? Beyond that, I'd cut out home décor (I'm sure your house is lovely) and the housekeeper and cut down on restaurants and ]the annual memberships category (how much of it do you really use?). You're in a good position, so use it to your advantage!

SwordGuy

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Re: Case Study: Feeling like we are behind!
« Reply #5 on: February 03, 2018, 10:05:16 AM »
First of all, you're doing better than a lot of folks.   

But you're one job loss away from disaster because you don't have much savings and your living expenses are very high.

I don't care whether you're a dietician or not, you are spending way too much on food and eating out.
Find the threads on this site, or on others, that tell you how to eat well without spending much money.

You should be able to cut that down by *at least* $750 a month.   Yep, that's right. $750 a month.

$85 a month for a housecleaner is wasted money.   Put your kids to work cleaning the house unless they are extremely young.   Get your spouse to help out.  That's another $85 a month:

Do you have a landline phone?  If you do, you only need one cellphone (at most). 

Put your pocket money in cash at the start of the month.  Cash gone, pocket money gone.   You don't overspend that way.   Still want a snack but spent all your pocket money?  Tough it out and go without.  That's $200 a month. Want to buy something online with your pocket money?  Go to the bank first and deposit the cost, then order it.   If it's not worth that much trouble, you didn't need it that much.

Household decor?   Not until you have a solid emergency fund that can last you at least 6 months.
Your totals for groceries, household expenses and personal care products are grossly high.  Cut them.
Check out MMM's blog entry about TDES - Tiny Details Exaggeration Syndrome.  It may help you get some perspective.

I don't know what issues the marriage therapy is addressing, but if you get the money problems licked and start pulling towards the same goal of financial security, then financial independence, then FIRE, a lot of them may just plain disappear. 

Best of luck!

FYI - at age 30 we finally got to a median family income and had a net worth of about $0.   We had made nowhere near the progress you've already made, had nowhere near the income you have, and had no idea that FIRE was even possible (or how to go about it).  Now we're millionaires.   You'll do fine if you learn to cut the spending.


familyof5

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Re: Case Study: Feeling like we are behind!
« Reply #6 on: February 03, 2018, 10:07:06 AM »
Carrie - You are totally right. We need to cut down on some of those extraneous spending. Preschool will most likely stay for us as well.

wordnerd - I think you've hit the nail on the head and why we feel like we are spinning our wheels. We need to set some solid goals. We are doing "fine", but don't have clear goals set. My husband and I are going to talk about this very thing today. Thanks for the kick in the pants. I'll update with thoughts later.

BeautifulDay

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Re: Case Study: Feeling like we are behind!
« Reply #7 on: February 03, 2018, 10:11:41 AM »
Seconded on needing to know your goals.  Have you and the husband sat down and decided what you want? Is he happy in the job, absolutely miserable, somewhere in between? Will you work when the kids are older? Etc. etc. This will help determine if early retirement is something you want. 

Once you have your goals set you can figure out what it will take to get there.  That will all come down to priorities.  You may have to cut some things you want but that are not truly necessary to meet your goals. 

One thing I would say is that you seem to struggle with paying yourself first.  You say that your emergency fund saving sometimes doesn't happen because of overspending. So make that the first thing you pay.  Better yet make it automatic. 

**edit- saw you posted that you will talk to DH today. Hoping for a productive conversation
« Last Edit: February 03, 2018, 10:14:26 AM by BeautifulDay »

Carrie

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Re: Case Study: Feeling like we are behind!
« Reply #8 on: February 03, 2018, 10:18:28 AM »
What worked for me was to make this frugality thing a game. Make challenges for yourselves (can I go 6 days without buying coffee out? Let's aim for two weeks with zero take out/restaurants/drive thru). Set savings up first, make it automatic, then limit your spending to what's left. Make your meals stretch, then get excited when your pot of black beans & rice and two chicken breasts make three meals for your five people.  Practice making food from scratch so you control the ingredients (should save money).  I agree with others that your food budget is probably the biggest target.

I found a way, after the older two were already through, to barter with the preschool to reduce tuition for the third kid (wish I'd thought of this sooner). I help them with something I'm good at, and enjoy, now tuition is heavily discounted. Win win.

Have coffee dates at home with friends vs. out.  Exercise at home (or outside) vs. gyms or classes.


MDM

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Re: Case Study: Feeling like we are behind!
« Reply #9 on: February 03, 2018, 10:30:31 AM »
Gross Income - $120k/yr ($10,000/mo)
Health insurance & benefits: $540
401K contribution (matched by company): $500
Withholdings (taxes, SS, etc): $1890
Assuming the $540 and $500 are monthly numbers, the $1890 seems high by ~$400/month. 

Not doubting what is deducted from the paycheck, but have you projected your 2018 taxes and adjusted withholding to match?

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scantee

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Re: Case Study: Feeling like we are behind!
« Reply #11 on: February 03, 2018, 10:41:15 AM »
You live a very typical American lifestyle. As others have said, in many ways you're not doing poorly (no consumer debt or massive car loans) but you're not well set up for an emergency like a job loss for your spouse or major illness for either of you.

The good news is that you have a lot of little extra spending that you should be able to cut fairly painlessly! Your food spending should be the first place you examine. You should be able to feed your family healthy foods AND accommodate various allergies AND enjoy a few restaurant meals on a $1000 a month. That is $550/mo right there so that is where you should put most of your efforts. There are many other places in your budget where you can cut $25-50/mo fairly easily (kids, personal care, home goods, yearly expenses) which, combined with your cuts in food spending, will save you around $750/mo without any major changes to your lifestyle.

With that extra $750/mo, I suggest you bump up your spouse's pre-tax retirement to the max amount, $18,500/yr. The extra $1000 a month he puts into retirement pre-tax will translate to around $750-800 less per month that you have available. Pretty much the exact same amount you will be saving from the easy cuts I describe above! This is a super easy win for you and one I suggest you make, like, this minute. It's a no brainer.

Once you've adjusted to your new lower spending, you can start to look for other ways to optimize your earnings and/or cut your spending. Were I in your situation, I would prioritize saving for a spousal IRA for you, which will require an additional $460/mo savings to get to the $5500 limit. You could also consider if you can earn this money somehow, rather than getting it through budget cuts.
« Last Edit: February 03, 2018, 10:42:56 AM by scantee »

familyof5

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Re: Case Study: Feeling like we are behind!
« Reply #12 on: February 03, 2018, 01:16:10 PM »
You are all totally right. It's kind of like death by a thousand cuts right now - we aren't doing crazy spending, but all the things here and there add up.

Today, we are working on our taxes, talking about what our goals are, and getting on the same page about it all (we don't fight about money and spending, we just need to catch up and have a budget meeting).

So far, our tentative goals are (they are a bit vague at the moment until we dig into the numbers a bit more):

- Beef up the emergency saving as a few of you mentioned above. Do this as quickly as possible. We are hoping to get it to $20,000.
- Set up auto-deductions to put the money away for above mentioned emergency savings before it even hits our bank account.
- After emergency savings is completed, first max out ROTH IRA and then max out pre tax 401k contributions.


I don't know what issues the marriage therapy is addressing, but if you get the money problems licked and start pulling towards the same goal of financial security, then financial independence, then FIRE, a lot of them may just plain disappear. 

FYI - at age 30 we finally got to a median family income and had a net worth of about $0.   We had made nowhere near the progress you've already made, had nowhere near the income you have, and had no idea that FIRE was even possible (or how to go about it).  Now we're millionaires.   You'll do fine if you learn to cut the spending.


Marriage therapy is thankfully not related to money at all. We are actually very much on the same page about money, which I am thankful for. It's pretty complicated due to some family and life issues somewhat beyond our control. It is a big expense, but we are looking at it that this is WAY cheaper than a divorce (not that we are near that, but ya know), or worse - not liking sitting next to the person once we do retire with all that money! It won't be a forever cost, and we feel like it a positive choice not only for us, but for our kids.



One thing I would say is that you seem to struggle with paying yourself first.  You say that your emergency fund saving sometimes doesn't happen because of overspending. So make that the first thing you pay.  Better yet make it automatic. 


Yes, totally agree. My husband and I talked a bit and we both agree we need to do some auto deductions. It is so easy, even when it is budgeted in YNAB to a savings category, to borrow that money out to cover overspending in other areas.

What worked for me was to make this frugality thing a game. Make challenges for yourselves (can I go 6 days without buying coffee out? Let's aim for two weeks with zero take out/restaurants/drive thru). Set savings up first, make it automatic, then limit your spending to what's left.


We are talking about doing a no spend month challenge to really get a jumpstart on things. I think it will be essential to make it feel like a game!!

Gross Income - $120k/yr ($10,000/mo)
Health insurance & benefits: $540
401K contribution (matched by company): $500
Withholdings (taxes, SS, etc): $1890
Assuming the $540 and $500 are monthly numbers, the $1890 seems high by ~$400/month. 

Not doubting what is deducted from the paycheck, but have you projected your 2018 taxes and adjusted withholding to match?

Really good point. We are doing taxes today and looking at all of this. Part of it is that we live in Colorado where state income tax is pretty high. I'll update with what we figure out once we look at our 2017 taxes and can maybe change some deductions moving forward.

2Birds1Stone

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Re: Case Study: Feeling like we are behind!
« Reply #13 on: February 03, 2018, 01:25:45 PM »
You make more than 2X the median US household income, and your net worth is already higher than nearly 75% of US households.....and you guys are only 33 year old.

So my most people's standards, you are doing pretty darn good.

Your spending is absolutely out of control though, being a SAHP I can't even imagine spending half of what you do on food. You should be able to cook healthy, in bulk, and using quality ingredients for $500-600/month easily. That figure may go up when the kids are teens, but for now there is your lowest hanging fruit.

Most of the other "variable spending" categories are very bloated.

The biggest thing you can do for your family, is to learn how to increase the utility of every dollar which comes in.

Many of the categories could likely be slashed in half, with just a bit of effort and planning. Take it slow and tackle them one by one, you could literally cut decades off your timeline to financial independence.

Good luck.

MDM

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Re: Case Study: Feeling like we are behind!
« Reply #14 on: February 03, 2018, 01:52:40 PM »
Assuming the $540 and $500 are monthly numbers, the $1890 seems high by ~$400/month. 
Not doubting what is deducted from the paycheck, but have you projected your 2018 taxes and adjusted withholding to match?
Really good point. We are doing taxes today and looking at all of this. Part of it is that we live in Colorado where state income tax is pretty high. I'll update with what we figure out once we look at our 2017 taxes and can maybe change some deductions moving forward.
Colorado state income tax was included in that $400 guesstimate.  Big bump in the Child Tax Credit for you in 2018.  See the case study spreadsheet or your 2018 tax estimation method of choice. :)

MrsWolfeRN

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Re: Case Study: Feeling like we are behind!
« Reply #15 on: February 03, 2018, 01:58:44 PM »
Umm, by most of our standards here, you ARE doing crazy spending

Max that 401k asap, it will help"starve the beast" on the other categories, and lower that tax bill. Then fill an IRA for each of you, and a mega- backdoor-Roth if allowed.  Your income is huge.

Also there is nothing wrong with credit cards as long as they are paid off each month. You might as well get 1-2% cash back on all the spending.

Cut the housecleaner and get the kids to help with chores.

Shop around or cut unnecessary coverage to lower that car insurance bill.
You can go cheaper on the cellphones too. There are lots of resources on the forums on how to do this.

Avoid restaurants except for your one date night per month, it will make it seem more special.

That grocery bill... I can't even imagine. And it doesn't even include toilet paper. Where are you shopping? Do you not have Aldi near you?

Step one is to manage waste. Switch from fresh to frozen veggies and fruit if you find yourself wasting a lot. Costco has organic frozen veggies for a reasonable price. Don't buy fresh produce out of season.
Give your kids a smaller portion, then let them have seconds if they finish what they have. Make sure all leftovers get eaten.

Keep a few frozen meals around to avoid last minute takeout situations. With the allergies you might have to make these yourself. Have a cooking day once a week and let the kids pitch in and help.

Do you eat a lot of meat? If so you could save big $$ by buying a half cow, pig, whatever directly from a local farmer. And you will know where it comes from.

Do you ever use coupons or rebate apps? This can help with the household and personal care categories more so than the groceries. It is easy to get free toothpaste, shampoo, lotion, etc.

You say you are trying to minimize things, but you are spending money on clothes and home decor. Why not pause all non-essential spending until you are done with your minimizing project. You might find something you already have that can fill that need.

familyof5

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Re: Case Study: Feeling like we are behind!
« Reply #16 on: February 03, 2018, 02:17:50 PM »
Umm, by most of our standards here, you ARE doing crazy spending

Max that 401k asap, it will help"starve the beast" on the other categories, and lower that tax bill. Then fill an IRA for each of you, and a mega- backdoor-Roth if allowed.  Your income is huge.

Also there is nothing wrong with credit cards as long as they are paid off each month. You might as well get 1-2% cash back on all the spending.

Cut the housecleaner and get the kids to help with chores.

Shop around or cut unnecessary coverage to lower that car insurance bill.
You can go cheaper on the cellphones too. There are lots of resources on the forums on how to do this.

Avoid restaurants except for your one date night per month, it will make it seem more special.

That grocery bill... I can't even imagine. And it doesn't even include toilet paper. Where are you shopping? Do you not have Aldi near you?

Step one is to manage waste. Switch from fresh to frozen veggies and fruit if you find yourself wasting a lot. Costco has organic frozen veggies for a reasonable price. Don't buy fresh produce out of season.
Give your kids a smaller portion, then let them have seconds if they finish what they have. Make sure all leftovers get eaten.

Keep a few frozen meals around to avoid last minute takeout situations. With the allergies you might have to make these yourself. Have a cooking day once a week and let the kids pitch in and help.

Do you eat a lot of meat? If so you could save big $$ by buying a half cow, pig, whatever directly from a local farmer. And you will know where it comes from.

Do you ever use coupons or rebate apps? This can help with the household and personal care categories more so than the groceries. It is easy to get free toothpaste, shampoo, lotion, etc.

You say you are trying to minimize things, but you are spending money on clothes and home decor. Why not pause all non-essential spending until you are done with your minimizing project. You might find something you already have that can fill that need.

By crazy spending, I meant that we weren't making huge one time purchases, but rather a lot of little purchases.

The grocery bill - I shop in bulk, cook and bake everything from scratch, buy meat in bulk from local ranchers/farmers, shop at Costco, reuse leftovers, use rebate apps (ibotta, etc), shop only in season and sale items. We live in Colorado and food costs are high - no Aldi around. I agree that it can be cut down, but not realistically under $800 per month. We have food allergies in our house that restrict dairy, wheat and most other grains, beans, and anything processed. That is A LOT of cheap items that are cut out. It is also a priority for us to purchase things like organic free range chicken (the cheapest I can find is a whole chicken at $3 per pound) versus hormone laden stuff at $1/lb. I knew I would get stones thrown at me about our food budget, and while I agree that we need to cut back, the reality is that it will be higher than most. I think a place we can really hone is the restaurant spending (which is often inflated because we can't just go to McDonalds, but have to go to places where food allergies can be taken into account, so this expense is 1-2x/week... that I agree we can cut out or down drastically).
« Last Edit: February 03, 2018, 02:19:39 PM by familyof5 »

Knitwit

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Re: Case Study: Feeling like we are behind!
« Reply #17 on: February 03, 2018, 06:11:02 PM »
Umm, by most of our standards here, you ARE doing crazy spending

Max that 401k asap, it will help"starve the beast" on the other categories, and lower that tax bill. Then fill an IRA for each of you, and a mega- backdoor-Roth if allowed.  Your income is huge.

Also there is nothing wrong with credit cards as long as they are paid off each month. You might as well get 1-2% cash back on all the spending.

Cut the housecleaner and get the kids to help with chores.

Shop around or cut unnecessary coverage to lower that car insurance bill.
You can go cheaper on the cellphones too. There are lots of resources on the forums on how to do this.

Avoid restaurants except for your one date night per month, it will make it seem more special.

That grocery bill... I can't even imagine. And it doesn't even include toilet paper. Where are you shopping? Do you not have Aldi near you?

Step one is to manage waste. Switch from fresh to frozen veggies and fruit if you find yourself wasting a lot. Costco has organic frozen veggies for a reasonable price. Don't buy fresh produce out of season.
Give your kids a smaller portion, then let them have seconds if they finish what they have. Make sure all leftovers get eaten.

Keep a few frozen meals around to avoid last minute takeout situations. With the allergies you might have to make these yourself. Have a cooking day once a week and let the kids pitch in and help.

Do you eat a lot of meat? If so you could save big $$ by buying a half cow, pig, whatever directly from a local farmer. And you will know where it comes from.

Do you ever use coupons or rebate apps? This can help with the household and personal care categories more so than the groceries. It is easy to get free toothpaste, shampoo, lotion, etc.

You say you are trying to minimize things, but you are spending money on clothes and home decor. Why not pause all non-essential spending until you are done with your minimizing project. You might find something you already have that can fill that need.

By crazy spending, I meant that we weren't making huge one time purchases, but rather a lot of little purchases.

The grocery bill - I shop in bulk, cook and bake everything from scratch, buy meat in bulk from local ranchers/farmers, shop at Costco, reuse leftovers, use rebate apps (ibotta, etc), shop only in season and sale items. We live in Colorado and food costs are high - no Aldi around. I agree that it can be cut down, but not realistically under $800 per month. We have food allergies in our house that restrict dairy, wheat and most other grains, beans, and anything processed. That is A LOT of cheap items that are cut out. It is also a priority for us to purchase things like organic free range chicken (the cheapest I can find is a whole chicken at $3 per pound) versus hormone laden stuff at $1/lb. I knew I would get stones thrown at me about our food budget, and while I agree that we need to cut back, the reality is that it will be higher than most. I think a place we can really hone is the restaurant spending (which is often inflated because we can't just go to McDonalds, but have to go to places where food allergies can be taken into account, so this expense is 1-2x/week... that I agree we can cut out or down drastically).

Any chance you could share a typical shopping list and/or receipt so we can make suggestions?

familyof5

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Re: Case Study: Feeling like we are behind!
« Reply #18 on: February 03, 2018, 07:20:55 PM »
Knitwit - Sure thing. We are going to keep all receipts this month to further breakdown costs in excruciating detail. I think an update at the end of the month on exact spending this month will be helpful. We have a breakdown of exact spending per month in YNAB, but what I posted was the average in each category over the last year, so there were some months that were higher in categories due to a bigger purchase or something that skewed the data. Our goal on groceries this month is $1000 and $250 on restaurants... I know, still insane to most of you, but that is a decrease from $1550 to $1250 total, so $300 savings. If I can get it even less than that, great. I'll update with what we actually spend this month. 

First order of business is getting our goals solidified, as many of you wisely suggested.  Next is doing our taxes and evaluating that. Then looking at increasing auto deposits to emergency savings and retirement. All while cutting out the extra spending we have already touched on.

To the question earlier about my husband's job - he is actually happy in his job and really enjoys the work. He doesn't want to do it until the day he dies, but doesn't feel a burning need to leave right this minute. That is good news, and I think with some solid goals to work towards, it will feel even more fulfilling. We both do want to be financially independent and have that freedom MMM talks about - that my husband can keep doing his job if he so pleases, but doesn't feel stuck forever and ever just to keep making money. 

Bracken_Joy

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Re: Case Study: Feeling like we are behind!
« Reply #19 on: February 04, 2018, 07:53:52 AM »
familyof5- if it makes you feel any better, I think you'll be AMAZED how much you can bring down the groceries =) That being said, it won't get to $600/mon overnight, you know? My husband and I have gone from $900-1000 in just groceries per month (probably about $1300 with restaurants, $1500-1600 with bars too). Now ~4 years later, somehow, we're routinely hitting sub $500/month. And this is with local, grass fed meats, a local woman who *delivers* eggs from her chickens to us, primarily paleo plus with some local dairy, tons of fresh vegetables, etc.

I'd say we pretty immediately were able to get to sub-$1000 for groceries+restaurants and completely eliminated bars. Within the next year, we got that down to about $800-900/month. It took another couple years to whittle that down below $750 routinely, and now we're often below $500/month. It won't happen overnight. It's a gradual process. Slowly stepping down the quality of coffee we drink, for example. If we dropped from locally roasted next door directly to costco? Would not have gone well for us. But going from roaster next door, to good co-op option, to trader joe's, to low end trader joe's... it was easy to make the transition that way. Think of it as "reverse hedonic adaptation." If you do it right, adaptation works both ways =) http://www.mrmoneymustache.com/2011/10/22/what-is-hedonic-adaptation-and-how-can-it-turn-you-into-a-sukka/ Similar idea, but we switched from albacore tuna to skipjacks. That's a huge win there- it's cheaper, it's better for the environment, AND it's low mercury. It was just a texture thing. But I adapted to it, and now albacore seems dry to me in most things TBH =)

The biggest gain in our grocery spending came from the MOST ANNOYING thing I ever did: I made a spreadsheet, and broke down my food by column. Fresh veg/fruit, frozen veg/fruit, proteins, dairy, pantry staples, pre-made foods, snacks, etc. And I broke down all my grocery spending for a few months into those columns. It helped me see where I could make huge leaps. Making our own sauces and condiments was a huge one. Even though I didn't *think* we had much food waste, I got way more creative on using scraps and ends (broth anyone?). I highly recommend Tamar Adler's "Everlasting meal" for ideas on this.

You can do it!!!!
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CrustyBadger

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Re: Case Study: Feeling like we are behind!
« Reply #20 on: February 04, 2018, 08:15:44 AM »
We have food allergies in our house that restrict dairy, wheat and most other grains, beans, and anything processed. That is A LOT of cheap items that are cut out.

FamilyofFive, I just want to chime in on your grocery budget. If you aren't able to cook with most dairy (just milk and cheese?  or also eggs?), wheat AND other grains, AND beans... the cheap sources of protein are mostly unavailable to you.  (You don't mention nuts in this list at all, but I'd be really surprised with these other food allergies if you don't have to avoid some of them as well.)

Given this, your grocery budget doesn't seem insane at all to me.   But with your education as a dietitian, and some attention to detail, it should be possible to reduce it at least a small amount.    I know my brother's family includes someone with celiac disease, and they have had to find creative ways to lower their food spending while avoiding cross contamination with gluten (for example they can't buy from the bulk bins at the grocery store.)

familyof5

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Re: Case Study: Feeling like we are behind!
« Reply #21 on: February 04, 2018, 10:44:24 AM »
Thanks crustybadger and Bracken_Joy! I really feel ok with cutting back in other areas more than cutting groceries to the point I feel like we are depriving our nutritional needs. Bracken_Joy - is $500 per month for just you and the husband, or kiddos included? Our kids eat SO much. I don't ever understand when people post, oh, kids don't increase the cost that much till they are teenagers. My 3 year old can eat more than me on a regular basis!

For all wondering what we eat, this morning's breakfast/brunch is a typical weekend one: 2 pounds of organic russet potatoes I chopped up & cooked in bacon grease that we saved from whenever we had bacon last, 9 eggs (from our chickens) scrambled with organic sausage from Costco (scrambled in to stretch it, otherwise my kids would eat a ton), paleo almond flour waffles with organic maple syrup and blueberries, and organic coffee we buy in bulk. I make a large batch of waffles (or pancakes) on the weekend so that we can have the leftovers during the week. Particularly for me when my kids have oatmeal (I can't eat oatmeal). I'm totally not kidding when I say that we use up everything (ie - bacon grease) and make everything from scratch.

That said, we are going to really focus on the extraneous spending in other areas this month (household stuff & restaurants to be specific) and keep the grocery budget at what we feel is reasonable for our family. And if we stay below it, awesome!! Hopefully decreasing it little by little month over month. I feel like everyone has their priorities, some people have hobbies that cost them money (knitting, woodworking, painting, etc)... cooking and food IS my hobby and I love it. So, like I said, I am going to really try to challenge myself to cut more drastically in other areas and not feel deprived in life (which, food feels like life for me). However, I do think we can do better and really cut out the restaurant spending. Does that make sense?
« Last Edit: February 04, 2018, 10:50:58 AM by familyof5 »

Laura33

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Re: Case Study: Feeling like we are behind!
« Reply #22 on: February 04, 2018, 10:50:47 AM »
I suggest starting with this:  https://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/

Looks like you are taking home about $7k/mo, and saving $900 (or less).  That puts you somewhere around 40 years to retirement (not counting your savings to date or the possible Roth bonus).  You feel like you’re drifting because you are - keep doing what you’re doing, and you will be doing it basically indefinitely. 

The first thing I suggest is max out your DH’s 401(k) or traditional IRA.  At $120k + bonus, you will benefit significantly from the tax deduction.  This will allow you to save substantial amounts without feeling such a substantial hit to your budget.

Beyond that, I’d recommend taking a look at your lifestyle.  Are you happy staying at home?  I ask because there seems to be a lot in your budget that focuses on escaping/coping with the obligations of house and kids - the preschool, the cleaners, the personal care, the marriage counseling, the fun money, the restaurants, etc etc etc.  It just doesn’t sound like the budget of someone who is really happy and fulfilled taking care of the home/kids full-time. 

If you guys want to make significant improvements to your budget, that requires the full effort of both partners.  That doesn’t mean that you have to go back to work.  But it does mean that if you want to stay at home, your husband’s job is to optimize what comes in, and your job is to optimize what goes out.  And that is hard - it means putting yourself and your kids to work cleaning and doing the chores, it means figuring out how to whack the hell out of that grocery spend, it means figuring out how to do free/cheap activities for family fun and date night, it means a lot more insourcing and DIY, etc.

I am not saying this to be mean - I only have two kids, and neither has significant medical issues, and even that was too much for me to want to stay home full-time.  But that is kind of the point:  if you want to increase your savings rate to buy yourselves some breathing room, you are the one who needs to make that happen (after all, your husband can’t just go demand a huge raise).  And you can do that either by bringing in some income yourself, or becoming that domestic goddess and whacking your bills.  Or you can keep doing what you’re doing, and be in shape to retire at around 65-70.  Again: a valid choice - you'd still be better off than most.  But those are pretty much your options.  So which is most attractive?
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Bracken_Joy

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Re: Case Study: Feeling like we are behind!
« Reply #23 on: February 04, 2018, 10:55:57 AM »
Thanks crustybadger and Bracken_Joy! I really feel ok with cutting back in other areas more than cutting groceries to the point I feel like we are depriving our nutritional needs. Bracken_Joy - is $500 per month for just you and the husband, or kiddos included? Our kids eat SO much. I don't ever understand when people post, oh, kids don't increase the cost that much till they are teenagers. My 3 year old can eat more than me on a regular basis!

No kids for us yet. (Trust me, that issue is costing waaaaaay more than your grocery budget...) But Husband is a performance athlete and eats 3000-4000 calories per day. I am not a short lady and fairly active myself, and tend to be in the 2000-2500 cal/day range. Husband can't do many carbs either, so that adds cost. $500 is even a conservative estimate now- we've been hitting some sub-$400 months, so we'll see what this year's average looks like compared to last year's (I just run these numbers once per year, since seasonality effects it so much, and big periodic expenses like buying a 1/2 cow). And that's the thing- somehow, we keep getting our grocery budget lower and lower! With no changes to health, it's great. I think a huge part is just finding your sourcing. Ex, getting organic certification costs a ton. So small hobby farmers often don't do it. But I've been to my "egg lady's" farm, and her animals are fed organic feed, and are way healthier and happier than the Mass Organic egg farms down in California. Plus then it's local economy, and not going to a huge company. AND they're cheaper that the store bought organic eggs. A win all around. I'm shocked how many things this applies to. We got a 1/2 cow last year for very cheap- the farm is certified organic and grass fed+finished, but they couldn't sell this cow as such because he had pink eye as a baby, so he had antibiotics and was off pasture for a couple weeks for that. So we basically got the "scratch and dent" cow =) Etc. There's lots of progress you can make while keeping your goals and ideals.

Sometimes trying to cut the grocery budget feels like major deprivation, so I back off. But sometimes, the challenge lights me up and I find a new favorite meal or ingredient to work into our diet. Since you are also a food lover, try to embrace it as a challenge, not a punishment, and see if that helps you flourish! You got this!
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familyof5

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Re: Case Study: Feeling like we are behind!
« Reply #24 on: February 04, 2018, 11:12:20 AM »

Beyond that, I’d recommend taking a look at your lifestyle.  Are you happy staying at home?  I ask because there seems to be a lot in your budget that focuses on escaping/coping with the obligations of house and kids - the preschool, the cleaners, the personal care, the marriage counseling, the fun money, the restaurants, etc etc etc.  It just doesn’t sound like the budget of someone who is really happy and fulfilled taking care of the home/kids full-time. 


Wow - um, yes, I actually am happy at home. It is the greatest challenge and the greatest joy of my life to be home with my children. If you must know, I have severe postpartum anxiety and depression after each child, so therapy, yoga class, and preschool (getting a break) along with medication are essential for me to be able to function and be a good mom to my children. Way more important than any amount of money ever will be. It's not escaping, it's survival. The fun money and restaurants are something that I agree can be cut back for sure. I am not denying that we for sure need to cut back in some areas, and we will do that, but I think everyone needs to remember people have different life circumstances than them. I have contemplated going back to work in private practice, but had to stop due to the anxiety and depression. It's on the table, but we would not look at it as a source of income... only bonus money, if you will, that would be directly saved or invested, but without the stress of *needing* that money. It would only be part time, but is a possibility. We are taking that option one step at a time. To your other point on which is more important, we have not nailed down a date yet on retirement, but we do want to retire early... maybe not as early as some of you, so somewhere in the middle of the American "norm" and many people on here. I think we can do it with a bit more focus and nailing down goals as many of you have pointed out.

familyof5

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Re: Case Study: Feeling like we are behind!
« Reply #25 on: February 04, 2018, 11:29:44 AM »

The first thing I suggest is max out your DH’s 401(k) or traditional IRA.  At $120k + bonus, you will benefit significantly from the tax deduction.  This will allow you to save substantial amounts without feeling such a substantial hit to your budget.


I'd love more info on this. We are admittedly investing newbies and we're trying to learn all we can about it. What is the benefit of maxing the traditional IRA prior to the ROTH IRA? I'd love to learn more and truly understand the math behind what is the smartest option. There is a lot of conflicting information out there regarding what the best options are. Hit me with all the info!

Laura33

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Re: Case Study: Feeling like we are behind!
« Reply #26 on: February 04, 2018, 12:32:32 PM »

The first thing I suggest is max out your DH’s 401(k) or traditional IRA.  At $120k + bonus, you will benefit significantly from the tax deduction.  This will allow you to save substantial amounts without feeling such a substantial hit to your budget.


I'd love more info on this. We are admittedly investing newbies and we're trying to learn all we can about it. What is the benefit of maxing the traditional IRA prior to the ROTH IRA? I'd love to learn more and truly understand the math behind what is the smartest option. There is a lot of conflicting information out there regarding what the best options are. Hit me with all the info!

A traditional 401(k)/IRA gives you a tax deduction now -- it does not count toward your taxable income at either the federal or state level.  So if your marginal tax bracket is say 28%, and you put $10K into your 401(k), you pay $2800 less in taxes now, so you get to save $10K at a "cost" of only $7200.  A Roth does not give you that tax deduction up front.  Both types of accounts then grow tax free.  With a Roth, you take the money out tax-free; with a traditional account, you pay taxes at your normal income tax rate when you withdraw the money.  So most folks say that a Roth is better if you think your tax bracket will be higher in retirement, and vice-versa.  But the other thing to keep in mind is that there are ways to take money out of a traditional account in a way that minimizes your taxes, too (look up "Roth pipeline").  So for most folks on here, and especially at your income level, the traditional is the better deal.

I think that is especially true in your case -- if you are dealing with depression and anxiety on top of three kids, then you cannot go whole-hog on the frugal homemaker thing without risking your mental health, because it would just be asking too much of yourself.*  And that means you probably need the extra room in your budget right now that you'd get from the tax break more than you may need the tax-free withdrawals in 30 years.  So I would recommend doing a trial run of your 2018 taxes under the new tax plan, switching the Roth contributions to a 401(k), and seeing what that does to your take-home income.  If you do that with an online calculator, you can use different levels of 401(k) contributions and see just how much you can put away while still keeping about your same monthly net income.  And then, as you make progress on your budget, you can increase the 401(k) until it is maxed out.

I think if you can get to the point where you are maxing out your 401(k), with what you have already, the 20-yr mortgage, and a few budget cuts, you would be in good shape by traditional retirement age, if not sooner.

*FWIW, I am personally just coming out of a year-long depression, and it's very up and down, so I know how hard/exhausting it can be to function with that -- and my kids are older and much more self-sufficient.
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Re: Case Study: Feeling like we are behind!
« Reply #27 on: February 04, 2018, 02:38:11 PM »
The first thing I suggest is max out your DH’s 401(k) or traditional IRA.  At $120k + bonus, you will benefit significantly from the tax deduction.  This will allow you to save substantial amounts without feeling such a substantial hit to your budget.
I'd love more info on this. We are admittedly investing newbies and we're trying to learn all we can about it. What is the benefit of maxing the traditional IRA prior to the ROTH IRA? I'd love to learn more and truly understand the math behind what is the smartest option. There is a lot of conflicting information out there regarding what the best options are. Hit me with all the info!
See the wiki entry Traditional versus Roth - Bogleheads for perhaps the best treatment from a pure math perspective.

familyof5

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Re: Case Study: Feeling like we are behind!
« Reply #28 on: February 04, 2018, 06:07:51 PM »
Bracken_Joy - Thanks again! It's encouraging to hear that. And I'm so sorry the hope for kiddos has been a hard journey!

Laura33 - Thanks for the encouragement. I am thankfully stable now, but we have decided we just have to suck it up on some costs for the sake of me being healthy. I think looking at what the best way to invest and put our money to work for us is really great advice.

Thanks MDM! I'll look at that.

Chrissy

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Re: Case Study: Feeling like we are behind!
« Reply #29 on: February 04, 2018, 10:56:33 PM »
It's totally okay to say, "Hey, the food is our priority, so the cost is not changing."  BUT, if food is your #1, then all other things have to be in service to that.  With that in mind, here's what I suggest:

Go back to a 30-year mortgage.  Interest rates on mortgages are still really low, and you could shuttle the savings into his 401k or the tIRA, thereby getting a 2fer:  pay less in taxes + earn more in the market.

https://forum.mrmoneymustache.com/investor-alley/investment-order/msg1333153/#msg1333153

Cell phones can be cut to $60-$80.  I use AirVoice with my iPhone for $30/mo.

Life insurance.  Your husband's employer probably provides at least one year of salary.  Find the exact amount and take it into account.  Also, log into Social Security and see how much would be provided to survivors.  I'm betting this should be cut by half if not 3/4ths. 

Preschool.  Does your husband have access to an FSA for childcare?  Why pay taxes on this money if you don't need to, amirite?  The good news on preschool is that it's going to fall away on its own once the kiddo goes to school, and then you can start stuffing that money into savings, too.

https://www.kiplinger.com/article/business/T020-C001-S001-flexible-spending-account-vs-dependent-care-credit.html


How much is your husband's 401k match?  Please add that to your income.

firelight

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Re: Case Study: Feeling like we are behind!
« Reply #30 on: February 05, 2018, 02:54:26 AM »
All good points so far. I'm interested in knowing your food spending in more detail. We are a family of four (one being a baby that starting on solids) and have allergies so we stick mostly to organic, free range, non contaminated food with a ton of veggies and fruits. Thankfully we can eat gluten but try not to (and succeed) most days. Our food budget is in the range of $300-$350 per month. We do eat a lot of rice along with veggies and meat for almost all our meals.

I get that food is your hobby as well - it boils down to you knowing what part is essential vs what is hobby spend. If you are happy with that split, then you are good.

I had/have PPD with both babies - I totally get the yoga/preschool/coffee, but have you considered other options to help with the PPD? What helped me was more interaction with other adults and more time outside. So we do a lot of free baby wearing activities with other moms around. I also treat myself daily by walking 2 miles to Starbucks, spend time there and walk back. I play the Stars game and don't think I've spent more than $20/month for the past 6 months (which has resulted in freebies as well). Another option we do is playdates in the park with friends.

I second others in that you are doing better than the average American but have a lot of fat to trim. How much fat you want to trim is upto you. That will accelerate your FIRE journey accordingly.

Roadrunner53

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Re: Case Study: Feeling like we are behind!
« Reply #31 on: February 05, 2018, 03:47:34 AM »
Familyof5, Just read some of these posts and was wondering if you could sell your house and find one that was less expensive. The house you are in is probably your dream house but do you really need it or do you want it? A smaller house could do two things. 1. you could pay off the mortgage sooner then turn around and put what was your mortgage payment into retirement money and 2. Smaller house will require less cleaning, therefore, a lesser need for a house keeper. You might be able to find a home in foreclosure. My goal would be to buy a smaller house, pay it off as quickly as possible then dump all that lovely money into retirement funds.

At your current rate to pay off the house in 17 years, all your kids will be adults. Are you planning to finance their college education? I didn't see that on your list.

Also, once your kids are all in school, you should think about getting back into the working world. Even if you worked part time it would be mentally stimulating and you'd be bringing in more money for retirement. I am sure with your background you could find many avenues to fit your schedule.

Another thing, Social Security bases it's calculation for money paid out on 35 working years. If you work less than 35 years, zero's are added in which lowers your monthly amount. No one knows the future of SS but somehow we can only hope it makes it into the future. For my Hub and I, it is a very nice security blanket. We have two SS checks, his pension, some dividends from stock and our IRA money that we pull out of each year. Every little source of income makes a difference!

Good luck!

civil4life

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Re: Case Study: Feeling like we are behind!
« Reply #32 on: February 05, 2018, 07:49:08 AM »
I am sure I am repeating some from the others, but FWIW I will put my 2 cents in.

Below is the link to the investment order thread that simplifies how to maximize your money.

https://forum.mrmoneymustache.com/investor-alley/investment-order/



Phones - $109 (2 cell phones) - Definitely look into other prepaid carrier...Republic Wireless, MintSim, This could be much less.
Preschool - $410 As someone else mentioned does your husband have an FSA?

Actually I think the rest of your set spending is pretty good, Especially in HCOL area.  Check with your car insurance to see what your deductibles are.  Raising to the max will lower it.  You do not give the age of your vehicles, but do they need full coverage?


Variable Spending
Groceries - $1200 - I think everyone has beaten this one to death.
Restaurants - $350  - Same as above (maybe look at groupon and find other deals)
Kid Stuff - $200 Looking for the free or cheap activities.  Buying second hand clothes, etc.
Babysitter - $75 Like others have said get creative with cheaper dates and/or work out a deal with friends to swap babysitting.
Medical - $200- Does your husband have an FSA or HSA... Again take advantage of pretax dollars. 
My money - $100 - Maybe find a youtube yoga class, meetup groups, learn how to make your favorite coffee/latte at home, find free entertainment
Husbands money - $100- I am guessing alot of this may go to work lunches?  Cut his hair at home?
Personal Care - $100 I am guessing the 3 year old will be potty trained here soon and this will probably go down.  Learn to shop sales.  When your shampoo goes on sale, buy enough until it will be on sail again
Fuel and Parking - $150 - How far does your husband live from work?  Would it be worth moving to be closer?  Combine trips?
Family fun - $50 Again look for some free opportunities - Groupon, parks, family game nights.
Marriage Therapy - $125-250 HSA/FSA?
Household Maintenance/Updates - $150 (yard supplies, paint, fixing this or that, chicken feed)
Household Decor & Goods - $150 (decor, cleaning products, toilet paper, etc) - Looking for sales
Housekeeper 1x/mo - $85 (mostly covered by cash from stuff I sell as we minimize things) - The 9 and 6 year old can definitely clean.  Three year olds love to do what mom is doing.
Yearly Expenses/Sinking Funds - $400/mo (Christmas, CSA membership, car registration, COSTCO membership, Birthdays/Gifts, Zoo membership, etc)
Savings to Emergency Fund - $400/mo (Sadly, sometimes a portion of this gets taken from the budget for overspending in other categories)

Like others have said there are plenty of things to cut and minimize.  There are a few low hanging fruit phones and housekeeper, but you did not get to this level of spending overnight so it will take practice and building new habits to become more frugal.  I think buy paying yourself first i.e. automatic savings 401k, IRA, EF then spending after will help. 

You said making it a game or challenge.  Find ways to include the kids.  Be sure they are learning the value of a dollar.  Visuals are always helpful.  You could use a thermometer picture to fill in as the EF gets to the $20,000.  If you do some sort of challenge putting stars or stickers on the calendar for each day of success. 

Be sure to come back to share your progress.
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Carrie

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Re: Case Study: Feeling like we are behind!
« Reply #33 on: February 05, 2018, 08:08:18 AM »
I totally understand the baby fog. I'm not sure I had PPD, but I noticed my anxiety went through the roof and I withdrew from social things I had enjoyed previously.  (No sleep, body issues, breastfeeding on demand 24/7.)
My youngest is 3 also. I am just now coming out of that fog, and am finding free ways to boost myself: volunteer/barter work at the preschool (took tuition from 415 down to 115); volunteer work at a local charity that ministers to poverty stricken families; walks outside with my dog, and a neighbor; meeting new neighbors and making park & house play dates; gardening & fixing up the yard in free or cheap ways; hobbies. All of these things are frugal or free and have really helped my mental state. 

I am proud of myself for not getting into the social means spending mode that I see all around me, and it takes some work to convince others that we can coffee/brunch date at home, but I'm finding that others are happy to save that money too.

I've found savings on home decor by sewing my own curtains/throw pillows/throw quilts, and shopping consignment & second hand for quality furniture. I've scored some nice pieces really inexpensively.

Just wanted to put it out there that spending may not be necessary for mental health.  :) or maybe it is, so I challenge you to find cheaper alternatives.

You guys are in a great position to really change your future, and I'm excited for you!

familyof5

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Re: Case Study: Feeling like we are behind!
« Reply #34 on: February 05, 2018, 08:29:20 AM »
Thanks everyone. While I appreciate the input, my mental health is not really up for discussion here. In all honesty, I'm contemplating deleting this post because it's super triggering for me to hear that the things I have figured out over the past decade to help with my PPA/PPD are not good enough or the "right" way of doing it. Everyone is different and it is a very personal journey. Please be respectful of that.

Familyof5, Just read some of these posts and was wondering if you could sell your house and find one that was less expensive. The house you are in is probably your dream house but do you really need it or do you want it? A smaller house could do two things. 1. you could pay off the mortgage sooner then turn around and put what was your mortgage payment into retirement money and 2. Smaller house will require less cleaning, therefore, a lesser need for a house keeper. You might be able to find a home in foreclosure. My goal would be to buy a smaller house, pay it off as quickly as possible then dump all that lovely money into retirement funds.


We live in a pretty high cost of living area and our home is VERY modest for the area. We purchased it at $320,000 almost 4 years ago, and it has gone up to $475,000 in value. It is about 1300 square feet and not fancy at all. I would not say it's my dream home, but it is perfect for where our family is now and I am very content with it. Moving would not save us any money, unless we moved away from the town we live in, which is not a goal for our family and would place other strains (my husband being farther from work, etc).


Preschool.  Does your husband have access to an FSA for childcare?  Why pay taxes on this money if you don't need to, amirite?  The good news on preschool is that it's going to fall away on its own once the kiddo goes to school, and then you can start stuffing that money into savings, too.

https://www.kiplinger.com/article/business/T020-C001-S001-flexible-spending-account-vs-dependent-care-credit.html



I honestly have no idea - that is for sure something to look into! Thanks for the idea.

Someone also mentioned FSA/HSA for therapy - I'm going to look into that as well.

civil4life

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Re: Case Study: Feeling like we are behind!
« Reply #35 on: February 05, 2018, 08:47:23 AM »
As someone who has struggled with mental illness for over a dozen years, I know how hard it is to want to get better.  I can only speak for myself, but I think many here just saw opportunities to suggest other ideas for life in general that are less expensive and not specifically tied to treating mental health.  As you said that is a personal journey and what works for one will not work for another.   
Givling - Payoff up to $50k in student loan or $25k on mortgage - referral code SG229715

ElleFiji

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Re: Case Study: Feeling like we are behind!
« Reply #36 on: February 05, 2018, 09:12:45 AM »
I have been on the forums for 5 years (different username). Until this January, I had the same 40-50/mo phone plan and called it non negotiable. Now I'm on a $15 pay as you go, with talk and data add ons.

My first 2 years here I ate out an insane amount. Then I found a solution and cut back. Then I started eating out again, and am cutting back again.

It isn't a linear journey.

Try cutting your grocery spending by 25, 50 or 100 a month. And stabilize, focus elsewhere, and then come back to groceries. Be proud of the progress you make.

I often use coffee shops, and try to choose tea or espresso more than a mocha. The rare mocha tastes better that way, and the experience is largely the same.

You said restaurant spending is an easy cut for you, so do that one.

Knitwit

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Re: Case Study: Feeling like we are behind!
« Reply #37 on: February 05, 2018, 09:37:18 AM »
Thanks everyone. While I appreciate the input, my mental health is not really up for discussion here. In all honesty, I'm contemplating deleting this post because it's super triggering for me to hear that the things I have figured out over the past decade to help with my PPA/PPD are not good enough or the "right" way of doing it. Everyone is different and it is a very personal journey. Please be respectful of that.


@familyof5 - As a mother, I also spend money that many on here would not consider "right". I spend an amount that many people would consider appalling on a monthly gym/hot yoga membership. It's the only break I get from being a mom.

The point of MMM/FIRE is to identify the lifestyle YOU want, and then build it. Is the spending on groceries important? Is the spending on home decor important? Is it more important than saving for retirement? If the answer is yes, that's OK, even if others disagree! People on this forum will help you cast a critical eye on your expenses, but ultimately, only you can decide what spending is important to you.

Perhaps stepping back and figuring out your goals would be the best first step for you. You wouldn't be posting here if you didn't want to make changes, but maybe you haven't quite figured out what the end goal is yet.

LifeHappens

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Re: Case Study: Feeling like we are behind!
« Reply #38 on: February 05, 2018, 10:54:47 AM »
OP, you might feel more at home in the journals section. The Case Study sub-forum is known for (lovingly) delivering facepunches and questioning every expense. The journals are Your Space to explore your personal journey. Facepunches are generally not welcomed.* There are lots of moms and lots of people dealing with chronic health conditions. The more narrative format gives you room to explain *why* you have made the choices you have and other forum members can help you from a place of understanding.

*Within reason. If you insist on needing a German sports car and a Polo Pony, you might get called out ;)

Carrie

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Re: Case Study: Feeling like we are behind!
« Reply #39 on: February 05, 2018, 02:24:56 PM »
I apologize for being insensitive to your personal issues. I definitely do not want to trigger or downplay your journey.
I was simply sharing what I've done to get through my dark years, with no judgment intended. I'm super frugal and it pains me to spend money on myself, even for self care. But, this has opened my eyes to perhaps why I've been ghosted by a friend when I shared my cheap self care regime. You never know what people want to hear when they ask for finance advice. :( I'm sorry.

familyof5

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Re: Case Study: Feeling like we are behind!
« Reply #40 on: February 05, 2018, 04:44:01 PM »
I apologize for being insensitive to your personal issues. I definitely do not want to trigger or downplay your journey.
I was simply sharing what I've done to get through my dark years, with no judgment intended. I'm super frugal and it pains me to spend money on myself, even for self care. But, this has opened my eyes to perhaps why I've been ghosted by a friend when I shared my cheap self care regime. You never know what people want to hear when they ask for finance advice. :( I'm sorry.

Thanks, Carrie. I will fully own it is my sensitivity to the topic. There is now way you could know that through and online forum of someone you don't know! I just wanted to preempt anything that would feel really hard for me to deal with (again, admittedly not anyone else's fault! Recognizing my own sensitivities).

It is super helpful to hear about all the possibilities and options we have, and to hear that we really are in a good position to make some real traction at this point!

I absolutely agree that my husband and I need to identify and clarify goals/priorities/dates/amounts/etc. Saving even $5 towards and aimless goal is pointless and won't feel very fulfilling. We are working on that, and I will for sure update on that once we figure out what the heck those are.