With so many personal finance bloggers sharing their figures, typically net worth, I thought I would take a different approach and focus on our spending and projections for our future spending plan. Frankly, our assets are limited, so net worth is dismal today.
Update: We paid off our mortgage and we’re debt free!
Until this year, we weren’t spending consciously. We accumulated debt, which we assumed was normal. Debt isn’t just normal, debt is supposed to be good, right? Debt means you have great credit, or so the creditors want us to believe.
Nowadays, when I hear someone say “credit,” “debt” or “afford,” I get a little queasy. When did we decide that debt was something we could afford? Now, we’re on a debt avalanche!
Below is our spending from Aug 1, 2013 to July 31, 2014 and Aug 1,2014 to July 31, 2015, along with projections for 2016. How do we plan to make further improvements for 2016? We’ll have an outline next week of the steps we’ve taken to stop wasting so much $.
At this time next year, we should be debt free. That’s right. We are trying to eliminate all $200k in debt in one year (or two). The relief I feel in simply writing the phrase “debt free” is unbelievable. The end is nigh.
Related Post: From Fishbone to FIRE: How We Plan to Achieve Our Goals
Food has been our focus lately. Food is fuel, so we’ve opted for raw foods that we prepare at home–no more restaurants for us, which were killing us in July 2014. Consequently, our health has improved and our budget is manageable. I imagine we could optimize further, but we eat a diet of seafood, organic fruit, organic veg and grass-fed meat and poultry, i.e. expensive stuff.
Health & Wellness
Due to the health crisis last year, we spent a ton of $ trying to sort it out. As a result, we will always save at least $500 each month in the off-chance that something could happen again in the future where the $ will come in handy. Our employer-subsidized premiums are not included in this category. This money is reserved for costs over and above our premiums.
Home Sweet Home
Home will be practically a non-existent expense in a year as we’ll be left with utilities, once we move into the small house. Pretty straightforward. Pretty awesome.
Though we aren’t saving for travel today, this will become a priority for us next year. Once we’re debt free next year, we’ll start saving a bit of $ for a trip. It will be our five-year wedding anniversary, so we want to return to Utah’s Mighty 5. For FinCon15, I have reserved a bit of our debt-payoff budget for gas $ and lodging, because seriously, it would be crazy to go into debt to get to a conference on personal finance.
Where the Leftover $ Goes
In the meantime, we keep optimizing our budget, putting $ toward our debt in an effort to balance the scales. If you have suggestions for further optimization and new blogs for us to follow, please note in the comments below. Optimization will be a process of continuous improvement.