November 2015 will forever be enshrined in our memories as the month that Babywoods made her appearance! Its been an incredible adventure thus far and I can say that becoming a parent is absolutely life changing and pretty awesome. Also, it’s exhausting and bizarre–after all, suddenly there’s a tiny human in our home who simply didn’t exist before. It’s quite a miraculous thing.
We didn’t do much this month other than nest, clean the house, decorate for Christmas (there’s nothing better than coming home from the hospital to a Christmas tree), and oh, you know, birth a baby.
Hence, this was a particularly inexpensive month for us, which provides the perfect counter-balance to our pricier months earlier this fall during which we traveled extensively. Mr. Frugalwoods and I are now delighted to be hunkered down at home with Babywoods (and Frugal Hound!) as we navigate this fascinating journey of parenthood.
My thanks to you all for your heartfelt congratulations on Babywoods–we deeply appreciate all of your good wishes. It was such a joy to read all of your sweet messages while recovering in the hospital. I plan to devote plenty of writing space to discussing our frugal parenting in the coming months, but for today, I’m just popping my head up from parental leave to bring you our November expenses.
Personal Capital: It’s How We Organize Our Expen$e$
Mr. Frugalwoods and I use Personal Capital to aggregate and consolidate our transactions from across all of our accounts. We then drop them into a spreadsheet to provide our below analysis for you fine people.
Tracking expenses is, in my opinion, the best way to get a handle on your finances. You absolutely, positively cannot make informed decisions about your money if you don’t know how you’re spending it. Sounds harsh, but without a holistic picture of how much you spend every month, there’s no way to set savings, debt repayment, or investment goals. It’s a frugal must, folks. No excuses.
Personal Capital (which is free to use) is a great way for us to systematize our financial overviews since it links all of our accounts together and provides a comprehensive picture of our net worth. If you’re not tracking your expenses in an organized fashion, give Personal Capital a try. Here’s a more detailed explanation of how I use Personal Capital for my expense tracking.
Where’s Your Money?
One of the easiest ways to optimize your money is to use a high-interest savings account. A high-interest savings account gives you money for nothing. With these accounts, interest works in YOUR favor (as opposed to the interest rates on debt, which work against you). Having money in a no (or low) interest savings account is a waste of resources–your money is just sitting there doing nothing. Don’t let your money be lazy! Make it work for you! And now, enjoy some explanatory math:
Let’s say you have $5,000 in a savings account that earns 0% interest. In a year’s time, your $5,000 will still be… $5,000.
Let’s say you instead put that $5,000 into an American Express Personal Savings account that–as of this writing–earns 1.70% in interest. In one year, your $5,000 will have increased to $5,085.67. That means you earned $85.67 just by having your money in a high-interest account.
And you didn’t have to do anything! I’m a big fan of earning money while doing nothing. I mean, is anybody not a fan of that? Apparently so, because anyone who uses a low (or no) interest savings account is NOT making money while doing nothing. Don’t be that person. Be the person who earns money while you sleep. Rack up the interest and prosper. More about high-interest savings accounts, as well as the ones I recommend, is here: The Best High Interest Rate Online Savings Accounts.
How To Read A Frugalwoods Expense Report
The below is an itemization of every single dollar we spent over the course of the month. I do this because it’s the most transparent articulation of how we allocate our resources and managed to save 71% of our take-home pay in 2014 (not counting maxing out our 401Ks).
Want to know how we manage the rest of our monies? Look no further than How We Manage Our Household Finances and Why We Don’t Micromanage Our Money. Why do we save so much and spend so little? It’s all in service of our goal to reach financial independence by age 33 and move to a homestead in the woods.
Interested in how we keep costs so low? Check out How We Save 65% Annually. If you’re up for some hardcore frugal adventuring, take my Uber Frugal Month Challenge, and, see how we did one year later in How A Year Of Extreme Frugality Changed Us.
We don’t budget and instead live on frugal autopilot. This technique saves us the time and hassle of building a budget (we’re some lazy frugal weirdos). The caveat here is that many people find budgeting incredibly helpful and I in no way malign the budgeting process. If you operate more successfully with a budget, then budget away my friends.
But Mrs. Frugalwoods, Don’t You Pay For X, Y, Or Even Z????
Wondering about common expenses that you don’t see listed below? Our August 2015 expense report has the answers you seek!
Alright you frugal money voyeurs, feast your eyes on every dollar we spent during the month of November:
|Mortgage & Escrow for Taxes & Insurance
|Yep, it’s high. But, we live in a very high COL city (Cambridge, MA) and this house will be our cash-flowin’ rental after we decamp to our rural homestead.
|We nailed it this month with groceries, due in part to our huge pre-Babywoods stock-up in October. I was delighted to see how little we spent this month!
|Utilities: Water bill (3 months of usage)
|Covers three months worth of water usage.
|Household goods from Costco
|Household supplies (including such things as dog food, toothpaste, toilet paper, vitamins, and more). This total does not include any human food.
|A very necessary expense around here.
|Utilities: Electric bill
|Seeing a downward trend in this cost now that our chest freezer has supplanted monster fridge.
|Gasoline for Frugalwoods-mobile
|Two fill-ups for the ol’ 1996 Honda Odyssey (which recently rolled over 207,000 miles!).
|2016 street parking permit for Cambridge, MA
|Since we don’t have a driveway or garage, street parking is where it’s at for us. $25 for the entire year is a pretty good deal!
|Utilities: Gas bill
|A 15-pack of Founder’s All Day IPA from Costco–cheap and yummy. Life is too short to drink subpar beer.