Monthly Budget Breakdown - August 2020
- T. Shepherd
- Sep 29, 2020
- 7 min read
The recent endeavor of converting vans into luxurious campers has consumed my world over the past two months and this blog, along with other personal aspects, have been placed to the wayside. Let's see if I can go back in time and remember what went into my spending a month ago.
It's been a while since I've been under or at budget and, spoiler, this month is no exception. I have some room to work on saving for future costs that are causing a category or two to always put me outside of my total budget. I'll touch more on this in the summary.
Well here we go, the second monthly budget breakdown for the month of August 2020!
Taxable Investing - $1,814 of $1,400 ($414 over budget)
With my IRA contributions maxed out and plenty going into my 401(k), I needed to find a better place for my money than the plummeting rates of online savings accounts. If you read my very first post, you would know that I have began to dabble in the individual stock game. I quickly found myself going off the rails on how much "discretionary" spending I was throwing into stocks each month and began to realize that I would need to treat this avenue of outflow like any other and create a budget category for it. This has allowed me to track this allocation and know when I have gone too far, even though that hasn't stopped me from trying to time the market and pull out extra money from savings. I am slowly getting better but I was still over $400 over my limit for this month. Time to dial it back and mimic an automatic transfer as much as I can to dollar cost average into the companies that I believe in.
Groceries - $506 of $350 ($156 over budget)
Either my grocery budget is too low or I have no self control because I have yet to stay under my budgeted amount. Since other random purchase such as TP, tooth paste, paper towel, etc. go into this bucket, I think it's a bit under valued. I still think I have room to control my spending and check to make sure that I'm not purchasing spaghetti pasta for the 3 time and become a hoarder. I don't want to give up the organic quality food and boutique shopping experience that Sprouts provides over other big box stores.
Eating Out - $393 of $250 ($143 over budget)
The combination of a new relationship where eating out was the main evening event and some friends in from out of town, I this budget category was not shown any love this month. I think it's reasonable to loosen the belt, metaphorically and physically, every so often and splurge on great meals with even greater people every few months. But if I want to make this a recurring event, I'll need to bump up this monthly amount as well as carry over unused amounts to the next month so I can ride the waves instead of smash head on into them.
Amusement - $821 of $200 ($621 over budget)
Remember how last month I said hobbies in CO are not cheap and getting into mountain biking blew the lid off of this category? Well I stand by that belief and continue the pattern by another sneaky aspect of the CO hobby; the upkeep cost! When I first moved to CO, a pair of $130 hiking boots was my first "splurge" item but come that first winter, I would really get to learn what splurging on hobbies was all about. As the beautify 70 degree hiking days were shortly replaced by the beautifully colorful leaves dropping, my money started to do the same on the main winter hobby of snowboarding! Dropping $2,000 on gear and a pass, I got my first big hit to this category but it was totally worth every penny! Now, every year around this comes the yearly cost of acquiring the infamous season pass. With the pass coming in at a whopping $735, I actually did pretty amazing for the rest of the purchases.
Clothing - $79 of $50 ($29 over budget)
Had to replenish my dwindling wardrobe at Target. Pretty sure I still wear most of the clothes I got that day but I'm still moving towards high quality purchases of few variation. I want to get to the point of finding the best clothing items and just buy several of the same thing. Might be hard to do on $50/month but if I only buy twice a year for the major season changes, I think this is very doable. Moving towards that minimal uniform of the Steve Jobs and Mark Zuckerbergs of the world!
Auto Insurance - $94 of $88 ($6 over budget)
You're probably asking "How can a recurring cost be over budget?!" and I totally hear you but... There is this pesky thing that happens every 6-months where car insurance companies like to recalculate your rates and provide you a new premium amount. I called my agent and asked to see why it had increased, as I have not had any accidents or tickets and was unable to get a straight answer. She said she would look into reducing this but I still have not heard back from her... This is a great lesson in how a budget can make you alert of increases in ongoing automatic payments and take the right actions to reduce if you can, even if nothing comes of it.
Gas & Fuel - $71 of $100 ($29 under budget)
COVID quarantine is loosening and that means more trips out to the mountains, which has removed the $0 gas months I had during the early days of the pandemic. I've been doing more mountain biking as well and this, along with all CO hobbies, involves quiet long, but beautiful, drives. I've also been thinking about a goal to transition to an electric vehicle in the next 3 years. Tesla, I'm coming for you!
Alcohol & Bars - $34 of $80 ($46 under budget)
Still killing it in keeping this category low. A few beer runs a month for nights in and park outings is the only money coming out of this budget these days. Might even take it to the next level and officially bump this category down $10 or so. I don't know, we'll see how the next couple of months treat me.
Service & Parts - $71 of $20 ($51 over budget)
There's this thing you're supposed to do every 3-5k miles... hum, what could it be? Oh yeah, get an oil change. This is an example of the best way to use the carry over setting on Mint. Items that happen every few months can use the lack of spending for a given month and carry over to the next month, allowing you to allocate fund to pay for small recurring costs greater than every month. I had forgotten to turn this on so no money was saved for this and I went into the red this month. I have since turned it on so we'll see if this works out for me in the next few months.
Shit Happens - $25 of $150 ($125 under budget)
I love this bucket for the fact that went shit happens, which Murphy's Law ensures, you have a mental out to let it slide. So if you leave your car parked on the street and the city has postponed their street sweeping program for COVID, don't assume they will warn you when it kicks back in. Me, along with the dozen of other cars parked on the same street, were surprised with both the earliest snow day in resent CO history as well as a bright yellow envelope. Christmas had not come early, as the softly falling snow would suggest, but the city provided parking citations. This was for $50 but I was able to dispute it and get it bumped down by half with a quick 2 min online submission. Could be worst but I was able to laugh it off knowing that I had planned for events just like this.
Honorable Mentions - $0 of $80 ($80 under budget)
I was able to not spend a penny on the following categories in the month of August! Budgeted amount in parentheses.
Hair ($60)
Rental Car & Taxi ($20)
These categories were drastically reduced after reprioritizing the funds that are applicable for post-COVID-19 days.
Totals
Total Budget: $3,835
Total Spent: $5,627
Total Difference: ($1,792)
Biggest contributors:
Excessive stock purchases ($414 over budget)
Snowboarding season pass ($621 over budget)
Unchecked spending on eating out and groceries (combined $299 over budget)
August 2020 Spending (excluding miscellaneous)
The main take-aways from my August 2020 spending review are as follows:
Colorado hobbies are surprisingly expensive but that doesn't mean they have to be a surprise. Know which recurring costs are associated with a hobby before you get into them and make sure that you are able to put money aside each month in preparation for the big bill. I need to create a new goal for these costs and put those funds into my savings account so that I can account for them and squirrel away the dough for them.
I need to do a better job at holding myself to the allotted amount for Taxable Investing and not allow myself to pull funds out of savings to try and time a down market. Never works!
Be more realistic with some budget categories like groceries and shift funds around while also finding ways to reduce spending on the frequently over spent categories.
Make sure that ongoing costs like oil changes are account for by turning on the carry over setting. This can be dangerous though since the bucket does not get filled and can be unintentionally directed to over spending in other categories. May need to play around with moving these funds to a separate bucket in my online savings account. Ally has made it easy to know set up different buckets within a single saving account that can allocate funds to different goals.
Overall, my budget looks way worst than it was due to funds being used from savings to support some aggressive stock purchase and a once a year hobby expense but this does not get me off the hook for being in the red by thousands for the month. Time to get more organized so that I don't hide misspending in large buckets. Organization is the key to staying on track with your budget and I think it's time for a little fall cleaning.
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