Budget overview

SallyAnneS · April 2013

I have been lurking on this board for a few weeks and it is really inpiring me. I hope it is okay that I post my monthly budget to get some feedback. Thanks.

Dh take home pay: 2000 (rrsp taken out already)

My take home pay: 1000 (I work shifts around dh so we don't pay daycare)

Fixed:

mortgage 1406.10

Car insurance 131.58

Car license 6.00 (saved monthly to pay once a year)

House Ins 76.13

Life Ins 46.35

Natural gas 87.00

Hydro 130.00

Water 50

Tv/internet 62 (in 2 yea4 contract to get 20% off internet if we keep basic cable)

Cellphone 40

Netflix 7.95

Debt:

Payment to mom $100 (15, 000 debt at 5% for a huge lose when selling previous house)

Home buyers plan $75 (10, 021 at 0% but not making money in rrsp until paid back)

Bank fees: 8.95 (just switched one acct over to a free chequing account to see if we like the new bank, if we do we will also switch this account)

Varibles:

Diapers 42

Hair 60 (hair cuts, dye - thinking of trying out the hair school which would cut this down to 30)

Gas 100

Fast food 20 (coffee and pizza occassionally

Groceries 320

Other 40

This leaves only 64.99 for big purchases and savings.

We also recieve $155/mth baby bonus which I try to save for ds but usually ends up being used for big purchases like his bedroom suite, upgrades to the house etc.

We currently have no emergency fund.

mgarza1231 · April 2013

Having an emergency fund is very important so you should cut out fast food, cut the internet and cable, and start putting money towards a 3-6 month emergency fund. After then you should really work on your debt. And is there anyway to refinance your mortgage so that your payment is 25-30% of your take home pay? Your mortgage is very high for your income. I would also be using your baby bonus for childcare to work more shifts.

Sisugal · April 2013

You are house poor. When you add all housing expenses you have 62% of your income going to housing ---- and that does not include internet/cable, next filcks. I do not see a line item for property taxes or maintenance/decorationg/furniture etc.

STOP upgrading your house. Live with it is for now and SAVE - you are going to need that emergency fund. You are one unexpected life event away from financial disaster.

Read Total Money Makeover by Dave Ramsey and Smart Couples Finish Rich by David Bach.

Fund NEEDS ony right now -- so no eating out, stop coloring hair etc.

SmrBrd2012 · April 2013

I'm also in agreement with PPs- the amount you're spending on your mortgage is way too high for your income. You could also cancel your cable bill and just use Netflix but it is relatively low as it is. H and I do that and most of the time we don't miss it. Otherwise there doesn't seem to be much you can do unless you move or get higher paying jobs. Good luck!

CuriousKiddosMama · April 2013

I have to agree with PP. Your house payment is HUGE for your income. It should be around 25-30 %, whereas just your payment is 50% of your take home all on it's own. Can you refinance to get it locked in at a lower rate? Could you or your husband pick up an extra shift or deliver pizza or something on the weekends? A home without an emergency fund to me is a nightmare waiting to happen. What would you do if your AC died on you and you had to replace it? That would be a disaster for your budget. I would cut any and all corners you can to create an emergency fund. Once you have that, I would start paying anything extra you can a month to cut down the principal of your mortgage (especially if you are underwater, so you could try and refinance easier). Good luck!!!!

brij2006 · April 2013

I am going to agree with PP. It sounds like you are house poor. What was the home buyers plan for? If you are paying $75/month on it, and in that meantime you are not making money in rrsp until it is paid back. By my calculations, it will be paid back in 11 years. That's a long time to be waiting to focus on adding to retirement.

The amount you borrowed from your mom on the loss of your previous home is going to take you about 13 years to pay back. At this point, making more money is going to be your best option. Take more shifts at work even if you have to pay a babysitter, do a direct sales business (pampered chef, mary kay, etc), deliver pizza's, bartend, anything. Begin a $1k Efund, then focus on paying off the debt. I would also recommend selling your home and moving into one that is 25% your takehome pay.

Also cut out coloring your hair and fast food. And save that baby bonus for an emergency fund instead of upgrading the house and his bedroom.

SallyAnneS · April 2013

Thanks for all of ghe feedback. You all said pretty much what I was already thinking.

The home buyers plan was used for the downpayment on our previous house (before we got smart enough to save first then buy). I am thinking after we get a small emergancy fund going that should be paid off first then my mom right so that we can be investing for our retirement. Would you agree?

I will be taking over a few more shifts at work in august and beyond. I had given them up as working opposite shifts and never having a day home as a family was ruining my marriage and my relationship as a family. We were pretty much living as single parents in the same house with the way we were handing ds off to each other as we switched shifts. That will add an additional $240 to the budget.

I agree my mortgage is way to high. It also includes the property tax. We have 2 years left in our term though. We bought this house when I was working full time. And plan on working full time again in 2 years. So we just need to make it to there

Dh does get a few bonuses a year. Would you put thisin the emergancy fund, against the debit or the mortgage? I

Sisugal · April 2013

Have you cancelled your gym membership? Time to do so if not already done. Walk, run, get work out DVDs from your library.

You do not have to buy pricey kids furniture, You can buy a solid wood set (or individual pieces) on Craigslist, estate sales etc. cheap. Sand and paint - and they look new. Same with kids clothes and toys. You do NOT have to buy new.

You are not a better parent because you spend alot of money on your children.

brij2006 · April 2013

SallyAnneS:
Thanks for all of ghe feedback. You all said pretty much what I was already thinking.
The home buyers plan was used for the downpayment on our previous house (before we got smart enough to save first then buy). I am thinking after we get a small emergancy fund going that should be paid off first then my mom right so that we can be investing for our retirement. Would you agree? Yes.
I will be taking over a few more shifts at work in august and beyond. I had given them up as working opposite shifts and never having a day home as a family was ruining my marriage and my relationship as a family. We were pretty much living as single parents in the same house with the way we were handing ds off to each other as we switched shifts. That will add an additional $240 to the budget. Apply that to your Efund first, then to the home buyers plan.
I agree my mortgage is way to high. It also includes the property tax. We have 2 years left in our term though. We bought this house when I was working full time. And plan on working full time again in 2 years. So we just need to make it to there
Dh does get a few bonuses a year. Would you put thisin the emergancy fund, against the debit or the mortgage? I would apply the bonuses to the Efund until it is to $1k, then strictly apply it to the home buyers plan.

jrodgers239 · April 2013

I agree with the PP's every cent of the $64.99 plus the $155/mth baby bonus needs to be saved for an emergency fund. As far as hair goes, do you have to get it done every month? Could you possibly go every other month to save some? And as for bank fees, I understand needing to like your new bank, but for now there is no reason to be paying 8.95/ month in fees that ends up being over $100/year that they make off of you just for having a checking account when you could be saving that or making another payment to your mom. It is a good idea to save each month for car licensing rather than paying a lump sum, and it's smart to work around your husband's schedule to not pay for child care, that is saving y'all a ton of money right there!

LS45 · April 2013

Are you a two car family with both cars paid off? If so, then I would sell one car while you're both working on separate schedules. Then, use the proceeds to start your e-fund and apply any extra to debt. That should also lower your monthly car insurance.

I would also cut out all of the luxuries like fast food, hair coloring, new stuff for the house, cable, etc. That would go a long way to increasing your e-fund.

SallyAnneS · April 2013

Sisugal:
Have you cancelled your gym membership? Time to do so if not already done. Walk, run, get work out DVDs from your library.
You do not have to buy pricey kids furniture, You can buy a solid wood set (or individual pieces) on Craigslist, estate sales etc. cheap. Sand and paint - and they look new. Same with kids clothes and toys. You do NOT have to buy new.
You are not a better parent because you spend alot of money on your children.

Idon't have a gym membership, havent in years as I know we can't afford it. And we buy almost everything for ds used. I agree that most things for kids don't need to be bought new as you are just paying for the packaging pretty much. We also got a lot of close for him as hand me downs.

His bedroom set we bought on a fantastic sale. I had noidea how much pstores wanted for kids furniture until we went shopping! We ended up getting a solid wood aet that will last him till he moves out for under $600, and used a bonus to buy it. We already had a hand me down mattress and he is getting bedding for his birthday from my mom.

I agree, spoileddoesn't mean your a better parent.nIn

SallyAnneS · April 2013

We do have two cars, but his is a work vechile. It is paid for by his work incl insurance amd gas. But because it is a work vehicle I can't use it for my errands or work, he needs to have it available to him 24/7. We do use it if he is with us for errands or anything else we are doing which cuts down on gas. My cqr insurance comes up in august so I plan to shop around and try and find a better deal, I find $130 ridiculous for the small amount I drive.

Regarding my hair I think I shoukd add that the moneyincludes my husbands haircuts as well. And I dye my hair at home out of a $6 box every 8 weeks. If I didnt dye it I would have been grey at 20, I have bad hair genes, now at 30 I am getting pretty white. But I am looking at a hair school for haircuts for $20 instead of the current $55. And I go every 6 to 8 weeks because my hair grows to fast. I used to have it longer so I would only go every 6 months but wanted a change.

is so good to hear that I should be saving ds baby bonus is our general efund. I have had guilt about using "his" money for our bigger planned purchases. I said above his bedroom set was from a binus but now that I am thinking about it more it was out of ds money. That bonus was used on a cheap gazebo so we can olay outside but out of the sun.

ugh, it ia so hard to get out of the "we work hard we should be able to buy stuff" mindset. But we really need to get it together. Last month I hurt my shouldar badly and had to work through the pain because we don't have an efund.

spalko · April 2013

I don't know if I missed something but when I subtracted all of your monthly payments from your $3000 take home pay, I was left with a balance of $190... Just wondering how you got to $64? I think PP hit all the other points as far as being house poor and cutting out all extras (hair, cable, internet) for the time being. Do you use coupon? Might not be a bad idea to start clipping in order to cut down on your monthly grocery bill.

orangehills · May 2013

I get $190 left over as well. Are you forgetting a bill or just did math wrong? (I'm hoping you did math wrong because bonus for you!!) Because if you have 190, plus your 155 bonus, plus cutting out the 20 fast food, you have about $360 a month to put into an e-fund. Get the e-fund built to 1k, maybe a bit more since you have a child if that makes you feel safer. Then start snowballing any debt you have... Look into any refinancing of anything, car insurance, home mortgage, banks to get away from fees.. definitely continue to shop used. Good luck!

RioG1978 · May 2013

Just a quick bit about the HBP repayment - you don't HAVE to repay it. Did you withdraw the max allowed (20,000?) If you don't repay it, you will just be taxed annually on 1/15th of the amount you "borrowed" from your RRSP's. If repaying that is making life really hard for you right now, you don't have to repay it. You have 15 years to repay it in full without paying the taxes... so even if you took out the max, at most you will be adding 1300 to your income annually and being taxed on it... pretty negligible.

SallyAnneS · May 2013

Omg, I'm rich! Lol just joking. But I did forget to double the savings on here. My budget at home is divided into the first and second half of the month. And I did mess up the math!

I still feel a bit guilty about uaing the baby bonus for our debt and efund. don't know why. I just feel like that is his money. But im going to stick it into our efund for now, along with this $190 and hopely I will have the efund at 1k within 4 months!

With the home buyers plan, I know we could just pay the taxes on theincome now. But I feel like having it come out of the account now makes it seem more urgent and therefore we can get it making money for us again sooner rather then later.

Looks like the efund will be set by the end ofAugust and then the home buyers will start getting $425/mth.tI

SallyAnneS · May 2013

If we wait to have another child the home buyers would be paid off by aug 2015! That's crazy. I feel very inspiried. Now to get dh on board...

Budget overview

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