Author Topic: My spending is, once again, out of whack. Please help.  (Read 4470 times)

David Lurie

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My spending is, once again, out of whack. Please help.
« on: March 22, 2016, 05:17:04 PM »
Hello All:

I've posted on this forum before, but it's been a couple of years. I remember that a lot of you were able to give me suggestions that really did help. Let me just point out that since my first posts, I have bought a house and had a child. Our incomes haven't really improved. I'd say they've held steady, and possibly have declined. But  that's not the point of this post. The point of this post is to help me with my spending. Keep in mind, we are a family of 3 with a house. What should we shore up on?

Mortgage: 2,700 (800 principal prepayment)
Travel: 1,487
Restaurants: 843
Child/Dependant: 827
Groceries: 661
General Merchandise: 517
Home Maintenance: 288
Personal Care: 275
Online Services: 266
Telephone/Internet: 209
Misc. Checks: 147
Utilities: 140
Taxes: 79
Clothing/shoes: 68
Entertainment: 34
Business Misc.: 11
Hobbies: 10
Healthcare/Medical: 4
Home Improvement: 4

Total: 8785.54

We contribute 36,000 annually to 401(k) and 457(b). 11,000 already contributed to Roth IRAs for 2016. 3,000 already contributed to 529 plan this year. Monthly paychecks typically add up to about 9600 after all taxes and retirement contributions, so we are living below our means, but there is vast room for improvement. Please, let me know your thoughts.

bobechs

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Re: My spending is, once again, out of whack. Please help.
« Reply #1 on: March 22, 2016, 05:25:17 PM »
Can't help you with the budget, which at first glance looks like an exploding volcano of wastefulness.

But I wanted to give you kudos on using the word 'principal' in describing your mortgage debt.  It's a matter of diction not often observed on these forums, and so whatever you are doing wrong I'd like to compliment (not complement) you on doing something right, right off the bat.

nereo

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Re: My spending is, once again, out of whack. Please help.
« Reply #2 on: March 22, 2016, 05:25:57 PM »
are these all per-month figures? I certainly hope not.
If they are...

What is your mortgage interest rate and term? only getting 800/2700 in principle seems really bad in today's climate
Travel is off-the rails insane
Restaurants also is way too high
What does "Child/Dependant" cover?
Groceries are slightly high... I'd shoot for $400-500 for a family of 3
"General Merchandise" - what is this?
Personal Care - really high.
Telephone/Internet - insanely high.  Google Fi and Republic Wireless have great plans for under $20 each.
Misc Checks - ??

Those are all big red flags.  I'm most concerned with the travel and restaurant budget, as those are closer to what we spend every 6-8 months.

Post back with some updates for the questions above and we'll be able to help further.

AZDude

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Re: My spending is, once again, out of whack. Please help.
« Reply #3 on: March 22, 2016, 05:26:39 PM »
Travel: 1,487 - This is obviously an easy thing to cut. $18K a year in travel is rather spendy.
Restaurants: 843 - Do you even eat at home? Learn to cook and try just halving this. Go for $420 a month.
Groceries: 661 - How is this so high when you eat out all the time?
General Merchandise: 517 - No one needs $500 a month in general merchandise.
Personal Care: 275 - Excessive.
Online Services: 266 - I dont know what this is.
Telephone/Internet: 209 - Whoa... yeah, you can do much better. I have a family of 3 and we pay $80
Misc. Checks: 147 - ???
Utilities: 140 - Reasonable
Taxes: 79 - Seems awfully low...

We will need more detail, but all of this is unmustachian.

David Lurie

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Re: My spending is, once again, out of whack. Please help.
« Reply #4 on: March 22, 2016, 05:29:19 PM »
Can't help you with the budget, which at first glance looks like an exploding volcano of wastefulness.

But I wanted to give you kudos on using the word 'principal' in describing your mortgage debt.  It's a matter of diction not often observed on these forums, and so whatever you are doing wrong I'd like to compliment (not complement) you on doing something right, right off the bat.
Well, thank you. I guess I should be further descriptive in saying that the 800 is above and beyond what my payment of 1911 is. I'm actually reducing mortgage principal by about 1200/mo. at this rate. If that provides any extra clarity.
Also, I'd point out that some of the travel expenses that I incurred should be reimbursable. At least I hope they're reimbursable. I wouldn't have booked the Ritz Carlton if I thought I wasn't going to get it all back!!!
Everything else is pretty much what the numbers are. How do you shore these things up? We have to pay for child care, and that's expensive on a monthly basis. What am I missing? Where can I be more efficient and optimize my expenditures/savings?

David Lurie

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Re: My spending is, once again, out of whack. Please help.
« Reply #5 on: March 22, 2016, 05:36:16 PM »
are these all per-month figures? I certainly hope not.
If they are...

What is your mortgage interest rate and term? only getting 800/2700 in principle seems really bad in today's climate
Travel is off-the rails insane
Restaurants also is way too high
What does "Child/Dependant" cover?
Groceries are slightly high... I'd shoot for $400-500 for a family of 3
"General Merchandise" - what is this?
Personal Care - really high.
Telephone/Internet - insanely high.  Google Fi and Republic Wireless have great plans for under $20 each.
Misc Checks - ??

Those are all big red flags.  I'm most concerned with the travel and restaurant budget, as those are closer to what we spend every 6-8 months.

Post back with some updates for the questions above and we'll be able to help further.

EDIT: Mortgage rate is 4.125 apy; Term is 30 years. We are still in year 1. Purchased in August '15.

These are monthly figures. I didn't include our Federal Income Tax Bill (which is due next month - EDIT: this is going to be 2322) or our property taxes in my tax number (EDIT: 5891 last year). I just used what I got of of my online software for the last 30 days. I realize that the failure to account for annual spending on a monthly basis can be misleading and I apologize for it.
As I posted above, I think that all of my travel is reimbursable, but I haven't gotten reimbursed yet. I had like a 1,400 bill from the Ritz Carlton in Philadelphia at the end of last month. Then there was an Amtrak ticket and a couple of Ubers. I'm pretty sure I'm getting all of that back.
Restaurants are pretty much on me. I've been going to lunch a lot and trying to get more business/wrangle up a new position. Maybe I should cut back on this. Its just hard to get people to come out with some kind of incentive.
Groceries - my wife makes meals for the family pretty much every day. She might get take out 1-2x a week, but we're talking about 100 max in the last month. All of the other restaurant spending is me.
Child/Dependent covers day care for the kid. I think we also bought some more clothes and some travel stuff so we don't have to haul around a pack and play. Maybe some clothes.
I don't know what General Merch is.
I don't know what the checks are for.
« Last Edit: March 22, 2016, 05:44:16 PM by David Lurie »

David Lurie

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Re: My spending is, once again, out of whack. Please help.
« Reply #6 on: March 22, 2016, 05:40:47 PM »
General merch can be broken down as follows:
200 - Amazon Echo
94 - Other Amazon Purchases (I think these were for general housewares and the FX show Baskets)
94 - Yeti Cups (I think my wife bought two of these things)
84 - Walmart (1 box of diapers + some clothes)
43 - Target (not sure, must be something my wife got)

Checks can be broken down as follows:
$135 - Piano Tuning
$12 - Charity/Girl Scout Cookies (something like that, not sure because my wife wrote the check)

nereo

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Re: My spending is, once again, out of whack. Please help.
« Reply #7 on: March 22, 2016, 05:48:08 PM »
ok - well with your new information things look better.  I would modify ("edit") your OP to indicate what you will actually spend on travel (whatever if not reimbursed). 

It also sounds like you included some things in your budget that aren't really monthly.  At least.. I hope you aren't getting your piano tuned and buying $12 in girl-scout cookies every month.

So:  consider using Mint or similar software to look at what you've spent over the last 6-12 months and then averaging out your expenses each month.  That should eliminate "once-a-year" expenses.  As mentioned earlier, "personal care / online services / internet & phone" are all very high, and it's up to you to cut your restaurant bill dramatically.

eliza

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Re: My spending is, once again, out of whack. Please help.
« Reply #8 on: March 22, 2016, 06:07:29 PM »
As someone who travels often (and expensively) for work - I would back out any straight reimbursement work travel.  If work reimburses you 100% for hotel, flights, car rental, etc --- keep track of that in a separate budget.  I would even go so far as to recommend you segregate those specific expenses onto a different credit card if that is feasible for you. 


David Lurie

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Re: My spending is, once again, out of whack. Please help.
« Reply #9 on: March 22, 2016, 06:34:09 PM »
As someone who travels often (and expensively) for work - I would back out any straight reimbursement work travel.  If work reimburses you 100% for hotel, flights, car rental, etc --- keep track of that in a separate budget.  I would even go so far as to recommend you segregate those specific expenses onto a different credit card if that is feasible for you.
Thank you. I've thought about doing this, but I intermittently get cards for bonuses (57,500 UA points, 50,000 SWA points, 87,500 Marriott Rewards points). I try to keep about $150,000 in credit card available credit, but close some of these new accounts as time goes on. Everything gets very complicated. What tips do you have for managing? Or do you just put everything on one card and sort of exclude that from your personal finance picture? Another issue that I deal with is that I may book airline tickets 60 or so days in advance, but I won't get reimbursed until like 60 days after. It's a huge pain in the neck to keep track of with online trackers. It's just a mess all the way around. How do I get a better picture of what MY core spending is outside of my job (also, my job is my life) so that's kind of pointless anyway isn't it?