Brace yourselves for an expense onslaught: September was our priciest month on record. By far. Yes indeed, we’ve royally outdone ourselves this time. Fueled by travel, a dishwasher, and our property tax bill–among other things–we spent a gigantic amount of money this month. But, it was (mostly) all for good. And, I am (mostly) unconcerned.
As frugal adherents, we don’t strive to never spend money, rather, we strive to spend only on things that matter. And on things that increase our longterm quality of life. It’s also true that months like this exemplify the rationale behind our frugality. Thanks to our savings and our lack of debt, we don’t have to sweat it.
Plus, there’s no reason to get upset over an expensive month. If you find that you spent more than you’re comfortable with last month, don’t berate yourself. Instead, take action this month. Get yourself set up with a way to reliably track your expenses–I use Personal Capital–and make changes going forward.
We Pay In Full
One of the reasons we occasionally have outlandishly expensive months is the fact that we pay for everything in full at the time of purchase. We don’t finance anything (other than our houses) and we don’t delay credit card payments.
Hence, this month includes the property tax bill on our 66 acre Vermont homestead for the entire year. We had the option of paying in two installments, but we prefer to pay things off immediately. Many folks pay property tax and insurance to their mortgage company on a monthly basis, which is a system called escrow. The mortgage company then pays the property tax and insurance bills on behalf of the homeowner. We don’t do that for our Vermont home as we’d rather take care of these bills of our own accord. So while our property tax bill looks like a big number, it covers the entire year. Plus, we love where we live and we chose Vermont for a reason.
As a sidenote, the reason we choose to carry mortgages on our primary residence and our rental property is that we have incredibly low interest rates on both homes. Hence, we prefer to invest our excess cash in the stock market, which should yield higher returns than we’d experience through paying off both houses.
My Husband Loves Me
Another reason we spent so much money in September is that Mr. Frugalwoods loves me. A lot. I know this because–unbeknownst to me–he purchased and installed a dishwasher and a kitchen sink disposal while Babywoods and I were off traveling. We’ve wanted a dishwasher here in Vermont since first we laid eyes on this house. I know that plenty of folks survive their entire lives without dishwashers, but I am not one of those folks.
Doing dishes by hand–a task Mr. FW and I performed together every single night since moving here–has to be my least favorite chore. By far. Yeah, I’m all for insourcing, but I’m also all for machines that’ll do my work for me. My inveterate handy man had to rip out several cabinets, move the refrigerator, install an outlet, re-plumb the kitchen, and re-wire the electrical in order to get this dishwasher and disposal ready for action. He then surprised me with a glorious reveal the night I returned home. Have I mentioned that he loves me?
Travel: Gets You Every Time
September also saw our three-week-long cross-country trek. Mr. FW joined us for the first leg of this journey, which was down to Orlando to visit his family. Then, Babywoods and I kicked it solo for the remaining 2.5 weeks as we visited my family in San Diego and I attended a conference. All the gory details of me flying alone with a baby are forever enshrined here. You’re welcome.
Despite my chief frugal weirdo efforts to travel cheaply (which I’ve done many times, I swear!), this trip was not a particularly glittering example of thrift. The airport was my main culprit. I had to check a suitcase–something I haven’t done since airlines starting charging for the privilege–because it’s not physically possible to cart baby, stroller, carry-on, and carry-on suitcase by one’s self. Furthermore, I packed food but was thwarted by a 3.5 hour delay before my connecting flight. Given that I was alone in an airport for hours with a baby, I ate all my food and had to buy more.
In the category of positive travel spending, we had the pleasure of taking our family and friends out for a few meals and drinks! We were delighted to treat folks while traveling. Although we rarely eat out when we’re at home, enjoying ourselves on vacation is important. Readers frequently ask me how we balance socializing and gifts with frugality, and this is yet another example (more on this topic is here, here, and here).
Also expensive. Mr. FW’s previously reported stomach bug landed him in the ER for a day, which cost us a co-payment as well as lunch in the cafeteria for me and Babywoods. This was another instance where I did pack food, but we were there for 8 hours and ate it all! I guess I need to up my packed lunch game.
Thankfully, we’re all healthy now–although I’m still shaking off the remnants of a cold and cough I caught out in CA. Not our healthiest month on record.
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 the 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 quit our city life and decamp to the country.
Want to know how we manage the rest of our monies? Look no further than Why We Don’t Micromanage Our Money. We also own a rental property in MA, which I discuss here. Why do we save so much and spend so little? It’s all in service of our goal to reach financial independence and move to a homestead in the woods (which happened in May!!).
For us, embracing frugality is a joyful, longterm choice. We prefer a simple life to one filled with consumerism and we spend only on the things that matter most to us. Our approach isn’t one of miserly deprivation; to the contrary, we live a luxuriously frugal existence.
Interested in how we keep costs so low (ok, except for this month… )? 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.
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 (and there are a lot of them… ) we spent in September:
|Annual property tax||$6,895.63||We paid a full year’s worth of property tax on our Vermont homestead.|
|Dishwasher!||$519.00||My new best friend. We have a $50 rebate, so the actual price will end up at $469.|
|Groceries||$325.63||The one winning category this month! Always happy with a bill below $350 for the three of us.|
|Meals for family and friends||$244.63||While traveling, we treated our family and friends to meals and drinks out.|
|Kitchen sink disposal (and electrical hardware)||$189.41||Mr. FW installed this disposal along with the dishwasher.|
|Electrical and plumbing supplies||$152.74||Electrical and plumbing supplies for disposal and dishwasher install.|
|ER visit||$150.00||Co-pay for Mr.FW’s trip to the hospital.|
|Household supplies||$102.47||All non-food household and farm supplies, including such thrilling things as toilet paper, dog food, and dental floss.|
|Gasoline||$92.23||Gotta love our fuel efficient Prius!|
|Medical records transfer||$57.91||Our MA doctors’ offices charged us to transfer our medical records to our new VT physicians|
|Seltzer C02 canister swap||$53.57||The cheapest way to enjoy seltzer. See how we hacked our Sodastream here and here.|
|Checked luggage||$50.00||Ugh. Hated to check luggage (the first time I’ve done so since airlines started charging), but it wasn’t a practical option to carry on my suitcase while flying solo with Babywoods.|
|Airport parking||$48.00||The very reasonable bill for four days of parking at the Burlington, VT airport.|
|Coffee grinder||$44.99||Our trusty coffee grinder bit the dust, necessitating a replacement.|
|Metal roofing for firewood stacks||$41.80||We got a bunch for free, but we needed more to cover our split, stacked firewood to help it dry out for winter.|
|Additional UPS for electronics||$39.99||A battery backup and surge protector for our electronics (we experience somewhat frequent, though brief, power outages here in the woods).|
|Airport food||$17.22||A seriously delayed flight = buying food!|
|Food while in ER (all day… )||$13.38||I packed food, I swear! But Babywoods and I were really hungry…|
|Outlet plugs, picture hanging hardware, and graphite for our door locks||$11.67||Outlet covers for a certain baby’s wandering fingers, hardware to (finally) hang up our pictures, and graphite for our sticky front door lock.|
|Lubricant for snowblower chain||$9.87||Winter is coming.|
|JB Quick Weld adhesive||$3.60||Uh, this is a long story… I’ll discuss in my forthcoming “This Month On The Homestead”|