Saturday, June 6, 2015

May 2015 Income and Expenses


The amounts below are cash amounts and are net of taxes, insurance, 401k contributions, HSA, etc. In other words, the amounts are what get deposited and withdrawn from my accounts.

Day job (take home pay) --- $12,889.45
Dividends/interest --- $1,110.96
AdSense (deposit) --- $114.25

Total net income --- $14,114.66

Expenses --- $3,991.24

Savings --- $10,123.42  Rate --- 71.72%


Sometimes you just have to expect the unexpected. As many know, Houston as well as much of Texas was inundated with rain last month. I can't honestly remember a month where I saw so much rain day after day. Here it is June 4th and I have yet to water my yard this year. For those who live in the south, you know that never happens. Usually the sprinklers fire up in late April and stay on through November.

In spite of the rain, I actually had my second best paycheck total this year and I only trailed March's total by around $20. I feel very fortunate to live in a state like Texas and more specifically a city like Houston. We may not have the great tourist attractions that many cities can boast about, but we are designed to do business and those who have dreams of making their fortunes and building empires should put Houston at the top of their list.

Anyway enough of the Houston Chamber of Commerce informercial. Despite spending a bit extra on a road trip/vacation, I am happy to report that I was able to keep the expense total under $4,000. The only real outlier expense was the $400 I spent on my tax preparation. Any of you accountants working for a large company, do yourself a favor and start your own practice ASAP!!!!  I can't believe what a gold mine tax preparation is.

I would like to keep my expenses a bit lower than they are so I can reach FI sooner, however how low can they reasonably go? Since I spent $4,000, if I had zero bills (impossible with taxes, utililites and food) the most I could drop is $4.000. On the other hand, income, in theory, has no upper limit. So between the two choices, I must focus on making more money right now. It's like a football team with an offense (income production) and a defense (expense reduction). It's nice to have a great defense and most likely the defense will keep you in the game, but ultimately it's the offense that determines the team's success. Trying to keep a team scoreless each time out is very difficult. I don't know where that analogy came from, however you get the point....hopefully.

So there you have it. A pretty solid month overall and with a few tweaks here and there, I think I can continue to improve my savings rate going forward.


Here are my savings rates for 2015.

January --- 46.72%
February --- 67.78%
March --- 80.00%
April --- 35.97%
May --- 71.72%

DEFY MEDIOCRITY

21 comments:

  1. MDP,

    Great work my man, amazing income, low expenses and you received that first deposit of Adsense, cha ching. Further, the 2nd best savings month this year, to where I can see you averaging between 65 and 75% on average throughout a 12 month period.

    I'm actually set to go to Houston for a week in July for a client - I usually make 3 trips during the year and you're right - no state tax + a great economy bodes well for financial success, I like it.

    Nice work MDP.

    -Lanny

    ReplyDelete
    Replies
    1. Lanny,

      Houston is the best. I just wish we could skip the brutal 100 degree days in July-Sept. It's just part of the give and take. When I see all the Facebook photos of my mid-western relatives this time of year I am envious. Of course the Nov-Mar months are the reverse.

      You are killing it yourself on the savings front. Your consistency from month to month is phenomenal.

      MDP

      Delete
  2. "...income, in theory, has no upper limit."

    This is a great point. My family looks at me as Mr frugal and I get dirty looks sometimes with my personal choices, such as driving a car that looks like it rolled off the set of Mad Max. While I'm focused on my goals, I also know there's a line in the sand where my frugality affects their lives so I don't want to go TOO far. That's where your quote comes in handy.

    If you don't mind me asking, what is your day job that rocks that kind of monthly net income?

    Best,

    DWC

    ReplyDelete
    Replies
    1. DWC,

      It's very rare that I drive a car that is newer than 10 years old. There was a time however when I bought a new car almost every year in my twenties. Those choices set me way behind and now I have been playing catch up for the last decade.

      I keep my job description generic. I run a sales department for medium sized company that is rocking due to the recent (last 5 years) boom in the Texas. It is highly cyclical and Darwinian in nature. It is a means to and end.

      MDP

      Delete
  3. Over 70% savings rate! I wish I could hit that kind of level, but like you said, the bills can't go much lower so its all about earning more. I'm doing my best, but I'm a bit envious of how much you bring home every month! It's awesome.

    Congrats on the great month.

    ReplyDelete
    Replies
    1. ADD,

      It is a long journey and mine has been filled with great successes and catastrophic setbacks. Like dividend growth investing, treat your career the same way. Constantly be looking for ways to advance yourself. Not so you can keep climbing the corporate ladder, but so you can get off it as soon as possible.

      MDP

      Delete
  4. Congrats on having yet another 70%+ savings rate month. :) Your expenses sound reasonable for having a family.

    ReplyDelete
    Replies
    1. Tawcan,

      They may be a bit high, but that is mainly due to eating out quite a bit. I must admit this is a hard habit to break away from.

      MDP

      Delete
  5. Awesome Month for you MDP. Im happy for you bud. You're doing exceptionally well. Keep it up and glad to be apart of your journey. Thank you for sharing my friend and take care. Cheers to us!

    ReplyDelete
    Replies
    1. DH,

      This journey is the best part buddy! It's not always easy, but it a pretty cool ride.

      MDP

      Delete
  6. Simply awesome MDP. Thats a killer savings rate!

    ReplyDelete
    Replies
    1. Brian,

      Thanks, buddy! It's been years in the making.

      MDP

      Delete
  7. Hello,

    You bought your wife a 2002 Pontiac 2002 Trans AM WS-6
    Please see with you wife the youtube video I sent you.
    It is all bout the GERMAN BUNDESAUTOBAHN where there is no speed limit.
    7:25 312 km/h
    10:55 314 km/h
    14:55 314 km/h

    https://www.youtube.com/watch?v=Or7u3SLrA4c

    BMW M5 F10 314km/h

    Warm regards,

    George T

    Netherlands

    ReplyDelete
    Replies
    1. Hello,

      You bought your wife a 2002 Pontiac 2002 Trans AM WS-6
      Please see with your wife the youtube video I sent you.
      It is all about the GERMAN BUNDESAUTOBAHN where there is no speed limit.

      7:25 312 km/h
      10:55 314 km/h
      14:55 314 km/h

      https://www.youtube.com/watch?v=Or7u3SLrA4c

      BMW M5 F10 314km/h

      Your savings rates , in one word " incredible !!! "

      Warm regards,

      George T

      Netherlands

      Delete
    2. George T,

      Thanks for the comment and I will check out the video. Technically I didn't buy all of the car for her. I actually got her to chip in $4k for it. Of course the gas, maintenance, and insurance is all on me....not to mention the weekly car washes. :-)

      MDP

      Delete
  8. Stop giving away my side hustle for when I quit my day job! Tax preparer is definitely on the list.

    ReplyDelete
    Replies
    1. FF,

      I think that is a great idea for a side hustle. Work hard for a few months and then coast the rest of the year. Seasonal side hustles like taxes, landscaping, holiday retail, are some of my ideas as well.

      MDP

      Delete
  9. Another excellent month. You are becoming the bar for us to follow.
    D4S

    ReplyDelete
    Replies
    1. Div Son,

      Very soon I will show you a glimpse into my past which helped for my current mindset and resolve. It was an ugly time as recently as the early 2000s. for me.

      MDP

      Delete
  10. This comment has been removed by the author.

    ReplyDelete
  11. What a great post! It goes to show just how good you are with handling your money, particularly in spending it wisely. The rate of your savings is really good, and I'm amazed, as well as surprised, by those numbers. In any way, thanks for sharing that with us! Kudos and all the best!

    Courtney Morris @ Onyx Cleaning

    ReplyDelete