One of the biggest reasons behind starting this blog was personal accountability, and what better way to do that than laying all the cards on the table?
2016 was a huge year in many ways. The first was that Allison left her job to stay at home. In 2015 we set a goal that by our son's first birthday, he would no longer be in daycare. We also started 3 Nails Designs, which opened up the opportunity. We crunched the numbers, and... $700. That was our break even, "if an emergency pops up (they did) we're screwed" number. I did have a backup plan, and I was prepared to work as much as needed to make this work. To us, having our son at home far outweighed our financial goals.
Our savings rate struggled, we had to dip into our emergency fund a few times, I made some real estate investing decisions that were borderline gambling, and we added a second child to the clan. We weathered the storm, the lessons were worth it, and things are back on track now, in huge part from 3 Nails Designs starting to pull in $1,300-$3700/month from June on.
Now that the cards are on the table, let's talk about them.
We were paying $650/month in extra principal payments for half of the year, then dropped it to $500/month when we ended our private mortgage insurance. If we continue at this rate, we are set to pay off our mortgage at the 10 year mark.
Daily Home Items
$162/month?! 2017 will be better.
Home Maintenance, Repairs, & Reno
New HVAC unit ($5,677), a couple plumbing issues that were out of my league, repainting our office & living room, and a simple bathroom remodel accounted for much of this.
Our fuel consumption is higher than I would like, but it's something we're working on. We live in a rural community so we were often driving 75 miles for OB-GYN appointments during this pregnancy. A 2017 goal is to get RW on board with biking, but it's a hard sale.
Our insurance will be going down slightly as we sold our second car and have become a one car plus a motorcycle family.
Our repairs category was demolished this year by a $2,843.30 fix.
This is an area in which we've consistently struggled and haven't been able to stay within our $450-$500 goal. No box dinners here. We cook 4-5 meals/week with leftovers for the other days. Late in the year, though, we started looking into the cost/meal of our usuals, which was a complete shock how expensive some where, then cut or scaled back on those.
Donations: We both strongly favor supporting those in need or causes we believe in, whether at the local or international level.
We use Cricket Wireless - 2 phones with unlimited talk, text, and 2 GB of data, but Republic Wireless, AirVoice, Ting, and many others can cut your bill drastically.
I bought a $100 iPhone 6, paid to have it unlocked, plus a case and screen.
I was pleased with our entertainment categories this year. They could all be cut if needed, but come on... life needs to be fun.
Our higher medical expenses were largely at the hand of having our second child; $2,549.38 for the hospital and doctor plus using the full $1,000 family deductible. Our life insurance will increase next year after we purchase term life for RW.
Race events are our weakness. This year featured a few 5Ks, two 25Ks, an indoor triathlon, half marathon, and marathon (paid, but didn't run due to injury) between the two of us. Will this decrease? Probably for the next couple years, but only because we have two kids.
I splurged this year and bought a Garmin VivoActive HR running watch. Did I NEED it? No. Do have buyer's remorse? Not the slightest bit... and I did have a $100 gift card.
$1,942.22 for general child purchases. Were we really dropping over $150/month for one child?!
My income ($39,260.78) = Gross income - taxes, pension, insurance, union dues, etc.
Allison: Received 3.5 paychecks before beginning staying at home.
3 Nails Designs: Began in late 2015 and really took off in May 2016
Side Business #2: Slow phase out of being an hourly construction subcontractor on my days off from the fire department.
Here's where we need to make some adjustments and explain a few things.
Total Income: $71,010.44
Stock Withdrawal: $7,466.10
*Stock options from Allison's former job, which were withdrawn and used for the purchase and rehab of a rental property.*
Adjusted Income: $63,544.34
Total Expenses: $51,414.78
Additional Principal Payments: $6,900.00
*30 yr mortgage but we're on track to pay it off in 10 years.*
Adjusted Expenses: $44,514.78 ($3,711.82/month)
Adjusted Savings: $19,029.56
Adjusted Savings Rate: 29.95%
And there you have it, a look into the Renaissance Millennial family finances. We're satisfied with how 2016 went, especially with everything that happened; however, there's room for improvement. We'll be challenging our reoccuring bills and being more aware of others, while also aiming to increase side job revenue.
Adjusted Expenses < $38,500
3 Nails Designs income > $25,000
40%+ savings rate
Purchase a small apartment complex (8-10 units)
Lofty goals for a family making less than $75,000/year, but financial independence is in our future. Stick around for our journey!
What ways do you see that we could trim back?
What are your 2017 goals?
How'd your 2016 turn out?
Let me know in the comments!
Disclaimer #1: Some of the links in this article may pay a commission to this blog if you use, sign up, or purchase their product; however, whether they pay a commission does not influence my decision in sharing the product/business. I only recommend products/business that I've used, would use, or have heavily researched.
Disclaimer #2: You're likely to find errors in my math somewhere. If I would have known in January 2016 that'd I'd start a financial blog in December, I would have kept much better notes on expenses.