The Money Mustache Community
Learning, Sharing, and Teaching => Case Studies => Topic started by: DavidItsMe on July 07, 2017, 08:44:47 AM
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My pregnant wife and I just made an expense sheet and I'm hoping to get some feedback on what could be missing on there and any ideas to improve our financial situation. I currently have exactly $0 dollars after having been unemployed for a month. The income below is after taxes with my new job that's starting next month.
We live in the suburbs in the Washington DC metro area in a 1 bedroom apartment. Unfortunately, we are stuck in one of the top 5 most expensive areas in the US where any type of enjoyment costs a bunch of money.
D's Income 5300
A's Income 0
Other Income 0
Income totals 5300
EXPENSES
Home
Mortgage/rent 1530
Electricity 100
Water + Sewer 45
Gas 0
Internet + TV 80
Cellphone 50
Renter's Insurance 12
Groceries 450
Home totals 2267
Transportation
D's Fuel 120
A's Fuel 100
Ford Car Payment 340 (two months left)
Car Insurance 90
Car Plates Renewal 2
Car wash/detailing services 2
Parking Tickets 2
General Parking 2
Property Taxes 17
Maintenance 100
Transportation totals 775
Entertainment
Disney Pass 0
Dining Out 200
Movies/plays 60
Other 80
Entertainment totals 340
Health
Health Deductible 100
Insurance 360
Prescriptions 13
Over-the-counter drugs 15
Co-payments/out-of-pocket 5
Life insurance 0
Veterinarians/pet medicines 0
Health totals 493
Vacations
Accommodations 100
Food 55
Souvenirs 5
Rental car 5
Vacations totals 165
Personal
Clothing 50
Gifts Savings 100
Salon/barber 15
Spa/Nails 50
Professional Development (Wix) 15
Charity 50
Personal totals 280
Financial obligations
Student Debt 331
Friend Debt 200
Supporting family member 420
Our Retirement 318
Emergency Savings 150
Child support 250
Financial obligation totals 1669
Total expenses 5989
Cash short/extra -689.00
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Well, that's clearly not going to work for you.
Movies/plays 60
Other 80
You are now only searching for free entertainment. No "other," no "movies/plays."
Friend Debt 200
Supporting family member 420
Our Retirement 318
Not to pry, but you may consider options around the first two so you can actually fund the third one. I don't know the circumstances around the first two, but you mentioned you are broke and are projecting out to not meet all your financial obligations for the coming month. Something's gotta give. See if your friend will let you delay payment. See if your family member can live on less money coming from you guys.
Dining Out 200
This is zero until you can find a way to have positive net cash flow.
Car wash/detailing services 2
Parking Tickets 2
General Parking 2
Property Taxes 17
Maintenance 100
Don't get your car wash/detailed. $24/year? Just wash it by hand when you want to. $24/year budgeted for parking tickets and general parking? I don't quite understand. And you have to pay $204/year in property taxes? For travel? Or is that on top of your rent payment? $1,200 in maintenance?? What is that?
Vacations
Accommodations 100
Food 55
Souvenirs 5
Rental car 5
Vacations totals 165
Almost $2k/year on vacations?? You can't take any right now. You just said you're broke. Sorry. You can start taking vacations when you get things under control and have positive net cash flow.
Internet + TV 80
Cut cable and just get Netflix for $10/month. Internet should be less than $50/month (we can get it for $30-$35/month for 10-15 Mbps).
If you use credit/debit cards for most everything, I'd look at Personal Capital or Mint to track your spending by category. It'll give you a better idea of sticking to the budget.
That said, if you stop taking vacations, stop eating out, stop going to the movies, stop giving to charity, and stop saving for gifts you'll break even. That's without addressing some of the other points above.
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Dark and Stormy gave some good suggestions to start with. The good news is in two months you will be 340 closer to 0.
For the Friend Debt and Supporting Family Member, without knowing the family member support situation, try to work something else out for either pausing payments or reducing payments on account of you not having a job.
Are the student loans for you or your spouse? If they are for you, while not optimal, look into a hardship deferral on account of being unemployed.
How far along is your wife? I don't see any expenses on here related to preparing for the birth of a child. Cut out everything in your entertainment section, your vacation section, anything that says "savings" other than the emergency savings. You need to focus right now on saving as much as you can to prepare for birth and post birth expenses.
Does your wife work or is she planning on quitting work once the baby is born? See what she can do to help bring in some income.
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Thanks both of you for the detailed notes, and yes, baby costs will be an additional expense that we haven't factored in yet.
Again, I appreciate the quick replies.