November 2016 Income and Expenses

So, my very first report on my months expenses and income. I am so not looking forward to this, and you will see why below, but hey, best to be honest from the start and see how it is. I would like to say next month will be better but I know it wont, its Christmas, and we have a lot on in December – but that’s next month. I think this month can be summed up in two words.

EPIC FAIL

If I could work out how to make it flash red, I would have done that as well. So lets get into the details and see just how badly wrong things went.

Income.

So, the income front was steady with the same salary landing in my bank account as always. I don’t include any income generated by my savings vehicles that don’t go into my current accounts, so the only other item coming in was a very small tickle from my other half’s ISA – which went straight off the mortgage. There is something comforting about the same amount of cash hitting the bank each month!

Expenses.

So, this personal finance and Retire Early stuff… it’s spend less than you earn.

Right.

Ok.

Ooooops.

There were a number of large one off’s that came up in the month that I wasn’t expecting, but then this is exactly why I tuck away a small amount into an emergency fund, to cover these large unexpected one off’s. The amount column is the percentage of my monthly income I spent on the item(s).

Item Notes Amount
Things I choose not to avoid* Mortgage, Insurance, bills, travel card etc. – yes, we could move somewhere cheaper, not have insurance, reduce our bills a bit and so on, but we are where we are.

42%

Groceries All the food and other stuff needed for home – my spreadsheet still says Food for Home but that’s because I am too lazy to change everything

7%

Alcohol for home Home alcohol consumption only. Please don’t judge 🙂

12%

Bicycles / Car related Any costs related to either the bikes or the car (car insurance and MOT come out of the first item, of things I choose not to avoid, so generally its just the fuel)

0%

Alcohol Out Generally, its the pub…. but it could be wine at a restaurant if i do split the bill out

3%

Eating Out I include purchased lunches in this as well as meals out etc.

5%

Other My catch all for anything I may have missed….

101%

Holidays Any spending related to holidays, flights etc.

41%

Savings Anything left over! This includes money into ISAs, mortgage payments and non relief pension contributions. My company pension comes out before it hits my bank account so isn’t included, nor do I include the “top up” of money when my money goes into my personal pension (i.e. I put in £100, I register it as £100, not the £125 that gets credited in my pension). Its worth noting that my pension savings and other half’s ISA savings go regardless.

0%

* This covers a number of things that I would class as essential for me. Yes, I could move to somewhere cheaper to reduce the mortgage (which in turn would reduce the insurance I have to pay), yes I could reduce my bills by switching energy supplier etc. but it comes down to what I am happy with. There are a few other things in there that are classified as essential that others may object, and so I have just lumped it into there.

The Details

So what to make of all this? Firstly, the big “Other” number is not things I expect to have to shell out on again, for at least 10 years, if not longer – possibly ever. The Holiday spending was paying for an entire ski chalet for our group, so I will recoup this in other ways when I am away, so I think of it as a down payment on my holiday!

Both the alcohol (in and out from home) and the food are higher than average, but I tend to do “splurges” where I do big shops and stock the freezers up for food.

Technically my numbers show 0 saved, however this isn’t quite true. Regardless of spending, my direct debits go into my other half’s ISA, and my personal pension, but I like to report from a cash flow perspective, so in effect I took money out of my emergency fund to keep my investments adding up. It works for me, but not for everyone.

So, not really a great start to a personal finance blog, showing how I spent so much more than I earned but this is exactly why you should have some cash in the bag for an emergency. If that money hadn’t been put away we wouldn’t have been able to do it – or worse, taken an overdraft / credit card bill etc. to cover them.

According to my spreadsheet nothing has changed as I don’t include my emergency cash, so it’s quite nice that nothing changes!

One final note and a plus side for me is that the mortgage over payments are starting to bear some fruit. We took a 5 year fix, and if we were to remortgage on exactly the same terms (duration, interest etc.), then I have knocked my payments down to the next rounding point (i.e. £50 less per month). This shows what difference those little extra bits soon add up to.