Author Topic: 2 kids, 1 new job. Next step? Living little in dirty south!  (Read 2092 times)

jess

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2 kids, 1 new job. Next step? Living little in dirty south!
« on: November 01, 2013, 10:42:34 AM »
I am a 31 mother of 2 children under 5. My husband and I live a reasonable lifestyle in our 2 bedroom home. My oldest goes to public school, and as of September 2013, I stay home with our baby. Before having children we biked a lot, ate a lot of lentils and rice and spent our evenings at music shows drinking cheap beer and dancing. Moving back to our southern home town was a bit of a culture shock but provided the love and help of family near by even if its exponentially more dangerous to bike here. However, living expenses are also MUCH MUCH less and we were able to buy a home. We spend a good 3 years living in our home while we fixed it up.

My husband started a new job in September.  This is good income for the area we live in. Previously we were making less than $50,000 combined. He also gets about $300 in royalties every quarter for the company that he is still a contract worker for. He also makes about $300.00/ month still designing for them. This allowed me to quit my job and stay home with our baby. I was previously working an enjoyable job, but not in a field I wanted to do for the rest of my life. I'm glad to be able to stay home for now. I also work as a birth assistant and photographer. Hubs has to commute about 20-25 minutes each way by car, but he has flexible hours and likes the environment. The employees are very loyal to this company although I do wonder how much growth is possible.

We are considering moving into a bigger house in the next couple of years and have a few more projects to do at this home (painting, tiling a hallway, some landscaping, building a small shed. We also may have to do some foundation work.)

Income: Husband's job $65,000/year. He also gets about in royalties every quarter from a company he used to design components for. After taxes and health insurance, I think this is going to average about $4,000/mo.

Average Monthly Expenses:
(these were culled from our Mint.com account.)

Cars: paid off last month!
Gasoline: $155.00
Car insurance: $130.00 for 2 cars (fixed)
Auto maintenance: $33.00 (variable)

Groceries: $539.00
Restaurants: $130.00
Fast Food: $38.00
Holidays/Special Occasions/Alcohol: $39.00

Mortgage/Insurance/Tax: $470.00 (just refi'ed in Sept.)
Home Improvement: $65.00 (variable)
Home Furnishings: $50.00 (variable)
Lawn, Garden, Landscaping: $50.00 (variable)

Health Insurance: ~ $200 (now thru husband's job, taken out of paycheck)
Mentorship / Personal wellbeing: $90.00

Small business expenses: $30.00 (variable)
Hotel to work on project: $90.00 (variable)

Preschool: now free
Occasional babysitter: $40 (variable)
General kid expenses: $50 (variable)

Utilities: $170.00
Husband's Cell Phone (Prepaid): $17.00
My Cell Phone: Free for now
Internet: $20.00

"Shopping" (Clothing, electronics, household goods, baby supplies, basically what I buy at Target): $130.00

Gifts/Holidays/Some charitable: $97.00

Taxes: $25.00

Student Loans (husband): $55.00 (fixed, will probably go up next year)

Misc (Pets/Personal care/Etc): $55.00

Cash/unknown: $50.00 (estimate from last 12 months)

= $2,818.00 (However, according to Mint.com, in the past 12 months we've actually spend more like $3,789.00/mo. In the last year we paid off a lot of medical bills ($1,500+), paid off our car, refinanced our house and no longer have to pay for Preschool for our oldest. So I hope the new number is closer).

Expected ER expenses:
Dental: ~ $300 (?)
Medical: < $500 (?)
New Car: May need a new car if 14 year old car dies, the A/C is currently out on it and transmission is sketchy. Husband is handy and has kept the car running this long.
Shed: (not an ER expense, but we have no outdoor storage right now).
I would like a new couch (I know, I know. Also, not an ER expense)


Assets: Reasonable emergency fund. ~ $3,000 (2.5% interest rate at the bank)
2 cars worth about $7,000 and about $1,500
Home is worth over $100,000 (would like to use as a rental home in the future)
Lending Club: $400.00
IRA at Hubs work: 6%, matched by employer (JUST began - should we put more than this in?)

Liabilities:
Home: owe $42,000 (Our home appraised for over $100,000 - 15 year note)

Hubs student loans : ~ $55,000 (Currently in IBRP - Income Based Repayment Plan. If you still owe after 20 years, then its wiped away. We have been paying for 4 years. He says the interest rate is 2.39%, but I'd really like to verify that)

Our skills: both have college degrees, both pretty handy. Hubs: electrical engineering, electronics, good with household & car fix-up. Me: birth assistant skills, photography, organization, research, some real estate knowledge, community organizing. Currently getting really good at breastfeeding and baby holding.

SPECIFIC QUESTIONS:  I would like advice about what we need to do to get on track. I feel like we're doing okay, but not investing as much as we should and not at all sure WHERE to invest. I just feel a little lost as to WHAT we should be doing. Our biggest financial asshattishness is the student loans, but IBR seems like the way to go. We want to retire early. We would like to eventually be able to travel and are not totally opposed to moving away from the area we are in. With children this seems harder every year as we become more invested in our community.


Alright, help!
« Last Edit: November 01, 2013, 01:31:20 PM by jess »

4alpacas

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Re: 2 kids, 1 new job. Next step? Living little in dirty south!
« Reply #1 on: November 01, 2013, 02:45:09 PM »
Your first plan of action is to track every penny you spend.  Where did the extra $971 go every month (~$12k/year)?  Also, you have $600 in cash that was unaccounted for. 


My  thoughts on your budget:

I think the easiest targets for your spending will be your food budget ($8,952 spent last year) and the shopping budget ($1560).  If you're able to get your food budget to a reasonable $400/month, you could put away an additional $4k/year.


Good luck!