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

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