Hello Lovely Mustachians!
I've been reading MMM for about a year and decided 6 months ago to try to really get our finances in order. I've started using YNAB, and husband and I have paid off all lingering consumer credit card debt (yay!). We have a baby coming in April, and I'm looking for a way to quit my job for a while to be a SAHM (something I think would be a great fit for my corporate-stifled personality). Neither husband or I are money/numbers people and budgeting has been a challenge. But we're trying, by god! We’ve cut our grocery bill down almost in half already (from $1200/mo!!) and are trying our best to move away from the consumer mindset we grew up with.
We live in a hip urban area in Colorado with hip urban, activities, friends and prices to match. My long-term plan sees us moving to a different area and shifting our focus to the mustachian things we love already (veggie gardening, outdoor sports, biking), but I need to figure out what to do in the short term to guide us in the right direction. Quitting my job will mean cutting $2200 out of our budget. Here are our details:
Monthly Income
Husband: 3000 (after health insurance premiums and 3% 401K deduction)
Me Corporate Job: 2200 (after 17% 401K deduction… trying to make up for lost time)
Me Freelance: 1200 (I'm a graphic designer and do freelance work in my spare time. I plan to keep this up after the baby is born. I could look at adding to this income, but would have to pay for child care if my hours exceed what I can manage in my downtime.)
Monthly income without my corporate job: 4200
Monthly Expenses/Utilities
Mortgage: 1373 (includes property taxes and homeowners insurance, we don't have PMI)
Phone: 133
Internet: 50
Electric& Gas: 145
Water: 25
Car Insurance: 130
Car Payment: 220
Fuel: 85
Self-Employment Taxes: 200
General Expenses
Groceries: 620
Household Goods (like TP, cleaning supplies): 100
Restaurants/Takeout: 380
Alcohol: 130
Medical out of pocket: 55
Clothing: 80
Personal Care/Exercise: 100 (includes yoga classes, haircuts, sports equipment)
Dog Food/Vet: 55
Family (and other) Travel: 400 (both families live in different states. We could reduce this some by removing trips to see friends, but want to keep family trips as a priority)
Entertainment: 60
House Maintenance: 80
Garden: 30
Gifts: 50
Baby: 160 (getting nursery ready, diapers, supplies)
Personal Spending on Credit Cards: 1000 (we've paid off our old debt, but somehow keep spending/paying off this amount per month on miscellaneous personal stuff. I want this number to be ZERO!!!)
Memberships: 20 (Costco, Netflix, Amazon Prime)
Savings: 700
Liabilities:
Car Loan (2009 Honda Civic): owe 7500 @ 3.45%
Mortgage: owe 227,000 @ 4.125
Assets:
Emergency Savings: 12k (4k of this is earmarked for baby delivery/insurance out of pocket expenses)
1999 Honda Accord (whose engine has been given a death sentence by our mechanic. We hope to get another year out of it and drive it into the ground.)
I’m not sure what to do about our car and car loan situation. We’ve lived as a one-car household before and have managed, although it’s not husband’s ideal. He really wants to buy a truck for hauling & mountain use and then have a commuter car as a daily driver. He works 2 miles from home and bikes occasionally when the weather is nice, but not daily. I’m tired of our car payment and would love to get rid of that $200/month outflow. Should I work on paying that off asap (perhaps putting some of our emergency fund into it) or calm down about it? I’ve suggested selling it and buying something cheaper, but husband thinks it’s a dumb idea to sell a used Civic only to turn around and buy an older Civic-like car with even more miles on it.
Sooo... what do you think, folks? I see A LOT of what we need to cut, expense-wise. Restaurants, alcohol, groceries and spending anything on our personal credit cards. Is there anything else that jumps out? Facepunch away!
Please shower me with your frugal wisdom and help me spend some quality time with the new bambino. Your input is so appreciated!!