Monday, August 8, 2016

Prime Time Sunday August 7, 2016

Prime Time August 7, 2016
Time for another Sunday wrap up of some of the best posts in the financial blogging world.  It is summer and the blogs have been a little slower than normal, this one included.  Lots of vacations and outdoor activities before the weather turns colder and the kids go back to school. Even with less to choose from there were some posts that were great this week and one that thoroughly touched me.

A Life of Yes brought to you by OurNextLife.  They usually update twice a week and I enjoy every one of their posts.  This one is about being able to say yes to friends and the things you want to in early retirement.

Not Everybody is a Spreadsheet Wizard.  RetireBeforeDad has some great spreadsheet tools and top ten financial calculators.

To Pepper:  by Done by Forty.  This post really touched me and my sincerest condolences go out to him and his family as they lost their beloved family dog.  I too am a dog lover and this one had me in tears.  This was a beautiful post to Pepper and reminded me of what is important.  Again my most sincere condolences.

That's all for this week.  On to another week.  Please remember to take some time and enjoy summer. That is a reminder to myself as well.  We all only have so many summer days to yet experience and they seem to go by so fast as you age.

Photo credit:  zavulonya

Saturday, August 6, 2016

July 2016 Financials

A Storm Brewing in our Finances

I feel like there is a storm brewing. As I look on the horizon things just don't look good.  As I was preparing our July month end numbers for this blog post I could hear the thunder clap in the distance and the room seemed to darken as I double checked every number.

Yes, July 2016 is now behind us but I feel like the storm is still to come.  For the second month in a row we blew our budget.  Remember in our June update we had missed our budget badly and reset our graphs to account for our new realization.  Off we went into July with a reset real budget counting every nickel and dime for probably the first time ever.  Mrs. iFreebies and I sat down and set our budget and goals.  We knew we had a trip coming up that would incur some additional expenses.  We had learned our hidden outflows of cash from June.  We would beat the July budget.

Funny thing though, life reminded us that you can't always stick to a budget.  We had some unexpected and very costly home repairs come up in July that shot through our budget (sadly about half of the cost will still hit in August).  A sad month to be sure.  Let's take a look:

As you can see we adjusted our projected expenses up in July to reflect what our real numbers were and try to reduce the June spending we had.  Actual expenses came in 18% higher than our budget though.  Below is a chart showing all categories that we went over budget on:

As you can see Home Maintenance was the biggest overage, followed by Pet Care (another unexpected minor emergency).  Those two alone make up 60% of the missed budget.  However the remaining 40% was more controllable and we need to do a better job on these in the future.

On the plus side our investments had a nice month and brought up our 4% potential passive income number up a little.  This was however brought down by a poor month in our other passive income category.  These two combined to essentially leave our potential passive income number flat.  Overall a very disappointing month.

When I started this blog I had hoped it would help me focus and kick things in gear in the home stretch of our working lives.  Sadly I never thought I would find some of the sloppiness in which we had been managing our finances.  We had always earned and saved well but I had no idea how poorly we managed the outflow of our dollars.  Even this month I was very excited to see our Net Worth grow to a new all-time high.  When I look at our expenses though I realize how far we have yet to go.  Here's hoping to a better August update.

Photo credit:  oleksiy

Sunday, July 31, 2016

Prime Time Sunday July 31, 2016

Prime Time July 31, 2016
Welcome to another edition of Prime Time.  The weekly blog post in which I share with you some of the best entries from some of my favorite blogs of the last week.  This week we have been on vacation so I didn't get a chance to post my own entry but did get some time to catch up on reading some of the other great blogs out on the internet.  Here are some of my favorites from the week:

A Day in the Life of Frugalwoods Homestead Edition:  Another great post from one of my favorite blogs.  An interesting look into their homestead life in New England.

A Silent Killer:  A more serious post by Mr. Tako on the effects of losing muscle mass as you age.  As I am getting older this one hit home a little.

The Peril of Second-Guessing Decisions:  Our Next Life continues to be one of my favorite blogs to read each week and their latest post hit a home run again.

Let's Go Exploring Denmark:  Millennial Revolution blogs about their trip to Denmark.  Great read as they continue to travel the world in the early retirement.

Our Ultra-Safe Early Retirement Plan:  Eat the Financial Elephant has a great post about developing a second income stream in retirement.

Photo credit:  zavulonya

Sunday, July 24, 2016

Prime Time Sunday July 24, 2016

Prime Time Sunday July 24, 2016
Welcome to week two of our Sunday Prime Time posts where we recap some of the best posts from the past week in the world of finance and early retirement.

I'll admit that it has been a very busy week for us in the iFreebies family so we may not have caught all the great articles out there.  Of the ones we did have time to read this week below are our Prime Time picks.

Mission Accomplished:  Freedom at 59.5 has reached early retirement ahead of schedule and is moving on to Life 2.0.  An impressive accomplishment and one that had to make our weekly Prime Time.

Step 1: Do Nothing. Step 2: Profit.:  A great post by a great blog I recently discovered, Mortimer's Money Machines.  Lots of other great older posts there as well.

There's Always Money Banana Stand:  A great shout out to the famous line from Arrested Development in a great post from RetireBeforeDad.  A must read if you have more than one property.

4 Years After Early Retirement Update:  By Retireby40.  A great update on the day to day living 4 years into his early retirement journey.  Some good advice about having side projects in this post.

We hope you have enjoyed this week's Prime Time.  Make sure to check back every Sunday for another weekly recap.

Photo credit:  zavulonya

Tuesday, July 19, 2016

Loose Ends Update

Time to update our savings numbers from credit card charges.
You may remember our post from last month Credit Card Loose Ends.  In the article we discussed how we started using Personal Capital to track all of our expenses and we were finding small credit card charges for services we had forgotten about.  As of the time of that post we had managed to identify and cancel services we no longer wanted or needed and save $42 monthly and $502 annually. I also promised that we would keep looking and keep everyone updated on additional savings.

Well here we are about a month later and the totals keep adding up.  We have identified more charges on the credit cards but have also found some in other areas such as recurring PayPal charges.  In today's world it is so easy to sign up for something with monthly payments.  Then you forget about them or remember them and a few dollars a month seems like no big deal (even though you don't need the service anymore) so you let it ride.  Here's the list as it currently stands:

Online subscription (hadn't used in over a year)                                                 $12.00   monthly
Online service (signed up when job searching don't need anymore)                  $30.00   monthly
Online subscription (seasonal use not needed now)                                           $20.00   monthly
Online service (iFreebies child #1 used for school, no longer needed)              $16.00   monthly
Online service (nobody remembered signing up one year ago, no need)           $4.00     monthly
Online service (decided no longer needed while reviewing costs)                     $64.00   monthly
iTunes auto renew service (no longer used)                                                        $8.24     monthly
iTunes auto renew service (no longer used)                                                        $5.24     monthly

Totals                                                                                                                   $159.48     monthly
                                                                                                                             $1,913.76  annually

So one month in thanks to Personal Capital and paying attention we have found $1,913 of savings this year.  Sadly that number is even larger considering most of these were going onto credit card bills so probably would have incurred some interest charges as well.  For this exercise we'll forget about the credit card interest and just focus on the savings.  That $1,913 we save annually can be invested over the next ten years before we retire.  That's $19,130 just in principal.  But imagine we average a return on this.  A $159.48 monthly investment over 10 years at 7% will get us $27,603 in ten years. Twenty seven thousand dollars for simply investing money we were essentially wasting by not paying attention.  I can imagine that $27,000 will come in handy at retirement.  If nothing else we know that would generate another $1,080 annually using the 4% withdrawal rule.

I also know somewhere lurking out there are some charges that only occur quarterly, semi-annually or annually.  I hope to find them before they renew but it wouldn't surprise me if they popped up in a few months and have to quickly be termed.  This exercise and the last month in general has us finding new ways to think about cutting expenses and we will look for those opportunities as well.  It is just amazing how much money can fly out of our accounts when we are too busy only focusing on bringing more in.  I'll probably add to this running list and keep it going for all to see.  Quite amazing just how quickly this adds up.  I keep looking at that $1,913 amount and remember that is after tax dollars.  Pre-tax that is easily $2,700 -$3,000 of our annual earnings that was essentially wasted. Kind of like giving ourselves a mid-year raise.  On to find more savings.

Photo credit:  convisum