It’s the end of the month and I’m doing one my favorite things: reviewing my budget. If you’ve read any of my previous posts, you’ve likely figured out by now that I enjoy being frugal and keeping a close eye on my finances. In no small part due to my desire to: 1) get out of debt 2) become financially independent. For someone with these goals in mind, there’s nothing more alarming than the red alert on Mint telling you that you’re over your budget.
“I keep such a close eye on my finances! How could this have happened???” I lamented. Despair set in as I scrambled to dissect every transaction I had this month to see where I needed to cut back and tighten up for May. Turns out, things weren’t as bad as I thought. Here’s what really happened:
According to Mint, I was $1,687 over budget (over budget, not over income). That’s the high level overview.
- I paid $1,125 towards my student loans, $725 over my budgeted amount of $400. If paying extra towards my high interest debt considered “over budget”, you can call me big spender.
- I was $74 over my grocery budget as a result of buying an absurd amount of items that were on sale, which will save me money in the future. i.e. I bought 12 cartons of orange juice @ $1.99 a piece, when they are normally $3.99. I also bought 21 packs of English muffins for $31.50 when they would normally cost me $94.50. I have 2 refrigerators and freeze all excess food items upon purchase. They do not go bad. Look for me on Extreme Couponners (or whatever it’s called) one of these days!
- I reinvested some interest income adding up to $77, something I choose not to budget for.
- We bought some printer ink for $90, but that’s not a monthly occurrence. Furthermore, the fact that we have a home office and I work as a real estate agent, makes it tax a deductible purchase.
- A trip to CVS as a due to a stiff back pain which resulted from intense yard work set us back another $34.
- The down payment check for the solar system was cashed, and cost us another $1,000.
When I look at the fact that $725 of that amount went towards paying my debt and increasing my overall net worth, I would say that I’m really $962 over budget. But when we drill down further, of that $962, $1,000 was a one-time expense, we’re really looking at $38 below budget. Not to mention, the rest of the expenses, while they will come up again, are not monthly recurring payments. We won’t need ink for 1.5 to 2 more years, which makes it more of a $5/month cost over the course of 18 months. I don’t always buy 12 cartons of OJ and probably won’t need to buy any for the next 2-3 months. I also won’t need to buy $30 worth of heating packs every month.
This budget also doesn’t account for the fact that made $125 from my focus group and got $265 back in rewards from the credit card company.
When it’s all said and done, I actually came out on top for the month of April. I netted a few hundred dollars in cash, which isn’t much. But I increased my net worth by several thousands through mortgage payments, student loan payments and increased investments.
How did you do?