Seriously, it's long, please read the whole thing before replying! Thanks!
Family: Me, DH (both 27), and three cats that can’t seem to keep a job
Income:
Me $79.1K
Take Home - $1748.92 every two weeks
Him $71.8K
Take Home - $1371.82 every two weeks (medical/HSA out of his)
Per month take home (average the ‘extra’ paychecks) $ 6,761.6
Current Expenses: Based on actual numbers from Mint (averages per month)
Home Related Costs:
Main home Mortgage (Principal, Interest and Taxes) $2,126.59
Home Insurance (for above) $69
Lake home Mortgage (Principal, Interest, Insurance and Taxes) $1,195.25
Home Improvement $200 <- Consider this hobby $$ also, already done some large renos ourselves and saved a ton of $$ by DIY, should/could be less soon though
Food Related Costs: This is the most epic fail ever, mostly caused by being lazy after work, was doing well at meal planning then completely fell off the band wagon, but I am being entirely truthful about it here
Groceries (includes misc toiletries or anything bought at our local warehouse store (BJs.. get your mind out of the gutter!)) $536
Restaurants $200 <- Our weekly go out with friends and support our local business for a great meal with lots of drinks is $136/month (been doing it for over a year), the rest could definitely go
His Lunches $252 <- I have paid for a work lunch only ten times in the last year since finding MMM, still looking for a way to get him to join..
Alcohol $202 <- Includes gifts to people… but this also should go down now that I got him to agree to not get a bottle of nice burbon every 2-3 weeks, he tried to grow his own hops and barley for making beer but hasn’t ever brewed.. he tends to get ahead of himself
His Coffee (DD) $60 <- He once worked at starbucks, he only likes iced coffee and says its difficult to make correctly for just one drink… he is the expert, have only pushed a little on this
Lazy eating $60 <- this is stupid and needs to stop, includes a weekend lunch at Panera while running errands, etc
Car Related Costs:
Car Payment $400 <- His truck, my car is paid off
Gas (auto) $242 <- our daily commute is only 8 miles each way, I have biked some, him once, we try to carpool but we also do quite a few driving trips (to the airport, to support friends at events, to participate in athletic events) that seem to pop up every month
Car Insurance (two cars) $85.25 <- just lowered it by upping deductibles.. still have collision and comprehensive because of value of cars.. because of deer I may always keep comprehensive, they suck
Car Regs $33
Car Property Tax (get most back on tax return) $57.5 <- Because our state sucks, though it is going down every year with devaluation of the cars
Car Maintenance (oil changes only so far) $5
Utilities/bills:
Electric (two houses) $90
Oil (heating, two houses) $300 <- averaged over the year, I hate oil heating, thermostat at 64 at main house, 50 at other house in winter
Sewer (one house on septic) $28
Water (one house on well) $20
Internet $57
Phones (two cells and home phone) $26 (thanks IP Daley!)
Netflix $8
Hulu $8
Other:
Pets $80 <- Good food/litter for three amazing cats plus a little extra for vet care
Weddings/gifts $50 <- We have two many friends, 9 weddings last year, 3 this year, 7 already scheduled for next year
Travel (multiple weddings every year, one vacation, one visit to his parents and one to mine) $350
Clothing $10 <- replacing work shirts and underwear mostly
TOTAL: $6750.59 <- HORRIBLE!
ER Expenses:
Hopefully way less, will FIRE with paid off housing but still working out the details as seen above
Assets:
Emergency Fund $20K
Savings (home improvement funds/monthly savings toward annual expenses) $7K
Checking $XX (amount to carry the monthly bills)
HSA #1 (no longer contributing to) $8K
HSA #2 (contributing max family) $4K
Main House $290K (guesstimate)
Lake House $220K (guesstimate)
My 401K(contributing max +5% match) $55.4K
His 401K (contributing max +5% match) $25.2K
My Roth IRA (contributing max) $12K
His Roth IRA (contributing max) $12K
Taxable $20.7K
Not really assets: His Truck- $27K, my car $12K
Total (not including cars): $674.3K
Liabilities:
His Truck loan $13K at 3%, less than 3 years left
Main Mortgage$200K, 2.79%, 12 year loan, little over 11 years left
Lake Mortgage $147.7K, 4.75%, 30 year loan, less than 29 years left
Total: $360.7K
Net worth: $313.6K
Before the frenzy of face punching commences, I know what we need to improve on, they are pretty obvious. I have also been really detailed and included everything we spend on. I cut his hair and just learned to cut my own so we don’t have that expense. Haven’t had cable in 4 years. Only use credit cards for rewards points. No more student loans. There are some obvious big problems if we want to live a life less wasteful. We do max out 401Ks, ROTH IRAs, and our HSA every year (starting this year), which is why our take home is so ‘small’ compared to our salary.
What is driving this case study: I dream of FIRE while DH can’t imagine it. I do all our financial stuff and he really has no drive to learn about it, which is great sometimes (I can change our 401K withholdings and he doesn’t care) and also sucks (because he doesn’t see how much we waste and only recently realized how much money I have saved for us so far). Since I haven’t found a motivation for him yet I have only been able to change the behind the scenes things (like 401K) easily while trying to stop life style inflation (cars/houses bought pre-MMM). We are talking about having kids soon and he is very much excited to start that part of our lives. I want to use this opportunity (a motivation for him) to get rid of our problem areas before a sleep-reducing, brain-less-money-spending-inducing being enters our lives. I already know most of our problem is laziness so add less sleep and another being to take care of and we could get into trouble easily (though the silver lining is we would be much less likely to go out to eat!).
Specific Questions:
1. I know our big problem areas are: the 2nd house, his truck, and food. Holy crap food.
-The truck is not likely to change anytime soon though I could pay off the loan.
- I have started thinking of selling the 2nd house (most of the equity is the down payment) as it does not provide us income, only great memories with friends. I have brought it up and I believe it will take having a baby for him to be on the same page (since I doubt we will be able to use it as much as we currently do.) For now, hard to be on the same page as we go every weekend and have only had it for a year(30 mins away from main house, super small cabin on a lake).
- I want and need your help with food. What can I do to help him spend less? I actually printed him out our food costs and sat him down and said it had to go way down before having a kid. He agreed but I haven’t seen much change. I have tried to get him to buy lunch things while at the grocery store but he can’t seem to figure out what he wants. Should I just start making him lunches? He goes with his group to get lunches: subway, Mexican, Chinese, etc so he does like a variety. I eat soups in the winter and salads in the summer with leftovers sprinkled in, same soup/salad for a week then a different one. He is also the main cook in the family but doesn’t seem to look for sales like I do so I guess I need to take over meal planning and just figure out how to cook better than him!
2. Those of you that have a larger income, max out tax advantaged accounts, higher networth for your age, how do you push to keep spending less? I am not talking keeping up the Jones, I am saying you are doing sooo much better than the Jones at saving, what do you do to keep motivated at spending less and not letting inflation set in? I was perfectly happy as a graduate student with enough money to party with my friends and eat decent food while renting a small place, I only had to work two day a week as an intern to maintain that lifestyle… well that’s changed. I would like to work less and spend my time with my future family and all the hobbies that interest me. So I found my motivation to spend less, do I just need to keep asking him what he wants to motivate him?
3. Do you see anything besides the main three we could work on? I call Comcast to lower the internet every year. The oil heating could use some work (which selling the cabin would help, or maybe we winterize it this winter…) but I am not sure the best plan for that as the main house isn’t very old and does seem to be decently insulated and not huge (1300 sq ft plus a basement).
4. Any tricks for motivating a spouse not picturing FIRE? I have tried to talk to him about how he pictures the future and tell him how great it could be but he is not one of those people that plans ahead. I have always been the one who thinks ahead while he lives in the moment, which is one of the things I usually love about him (he rarely ever has a bad attitude or gets stressed). While we are both engineers I am more of the typical personality while he is definitely way more of the creative, see what happens type.
As you can probably see from my questions this isn’t necessarily a “what can I cut” case study, more of a “how can I cut, what actions can I take” when I am not the only person in control. Thanks to anyone who made it through this, told you it was long.