My Household Budget (May '17 Edition)
If you have never thoughtfully (and somewhat brutally) taken a scalpel to your budget, I highly recommend you make an effort at some point in the near future to do so. In 2015, my wife and I really paired down our necessary living expenses, which was a refreshing and freeing experience. However, since then, I have let things slip and our expenses bloat. So, in an effort to get back on track and hold myself accountable, I will begin posting my household budget here. No further ignorance. No further excuses.
I started with a rundown of this year's expenses, broken down by month. Each month I have also calculated a rolling average of monthly expenses to get an assessment of whether or not expenditures are steadily moving higher or lower. I am not accounting for miscellaneous expenditures (clothes, travel, meals out, etc.) as they are rather discretionary and personal. Instead, I want to hone in those necessary items that are somewhat fixed and more predictable, so that I can honestly evaluate where there is room for a reliable budgeting improvement. Upon first review, it appears there is definitely room for efficiency. Here is what I found.
Through May, total household expenditures have averaged almost $3,250 per month. This is a bit higher than I would have guessed, but not too far out of range. We opted for a nicer apartment in the city last year which upped our rent and parking expenses.
Insurance expenses for April were higher due to payment of an annual life insurance premium. Total costs should remain around $500 for the remainder of the year which will put downward pressure on the rolling monthly average.
Automobile expenses will decrease in June, as we made our final car payment in May (hooray!). I highly doubt we will ever finance a vehicle again, as ongoing payments for a depreciating asset really annoy me. The spike in auto expenses for February was due to an auto insurance payment.
Another irritation is that our internet bill has been slowly rising. We are now paying over $100 for internet and local TV, which seems high. I will be finding a way to trim that back.
Bring the rolling monthly spending average to under $2,900 by the end of the year
Eliminate our parking lease ($214/mo) by this time next year (May 2017)
Reduce our rent/mortgage expense by at least 10% by this time next year (May 2017)
If all targets are met, this should result in nearly $700/mo of savings from our current rolling average of $3,250/mo. The rent/mortgage savings might even be a conservative target, assuming I can land a property to house hack. The key will be to find a lender who isn't weary of a self-employed household (lenders really like a W-2). I have already been denied once, but the search will and shall go on.
Bonus: Here is a blank version of the Excel budgeting template if you would like to track expenses for your own household!