Eliminating expenses

What happened this last month?

Our expenses dropped considerably this past month because December of last year was when we bought the truck. I expect our expenses to continue to drop this year and get us into a good position long term with what we’ve saved.

As I said last month, we decided to do a trip between Christmas and New Years to the Los Angeles area to experience the Warner Brothers Studio Tour and the Holidays Made Here event where they turn their Midwest Street back into Stars Hollow from Gilmore Girls. It was pretty cool to see how movies and TV shows are made and to get to experience and be in the places where a lot of great ones have been filmed. That only consumed one of the days we were there.

Other days of our visit were spent seeing landmarks like the Griffith Observatory, Pacific Coast Highway and the Hollywood Walk of Fame, plus seeing the Rose Bowl Parade floats being made. We also did a few different museums, including Madame Tussauds (if you can call that a museum).

Soapbox moment

I’ve been doing a lot of thinking lately about waste as we attempt to eliminate unnecessary expenses from our daily life. Recent headlines highlighted day care fraud in Minnesota. Afterwards funds were froze to 5 states. This thought process confused me.

Having worked in retail when I was younger, I know that businesses assume a certain amount of “shrink” as part of their budget. Essentially, they expect that things will be stolen, miscounted, or not sent by suppliers and that will negatively impact their bottom line. How can we not expect the same thing to occur in an organization as large as the government?

Am I saying that we shouldn’t stop fraud from happening? Of course not. If it’s found, then do what we can to stop and prevent it. But turning off the faucet to those who are doing things right because of someone who does something wrong does little long term good. It’s like the retail store closing their doors because someone stole something. Instead, they do what they can to reduce the issue, and move forward. That feels like what we should do here – reduce the issue as much as possible and move on, not punish those who need to use these services to keep their job and contribute meaningfully to society.

Where did we spend the most?

Our monthly expenses were almost event compared to last last month. Annually, they’re down considerably from last December.

• $2617 Christmas trip
• $2334 Car insurance
• $1792 Christmas
• $200 Saddle fitter

The Money Related Numbers

Completed! – 126.56% to target number (previously 126.09%)

This is our invested assets (401k, HSA, IRA, brokerage, etc.) divided by our target goal number.

31 months until original FI date (previously 32)

The number of months until my 45th birthday and our Financial Independence date.

Completed! – 0 months until calculated FI date (previously 0)

The number of expected months until we reach our target number. This is based on our current expected monthly contributions, assuming a 10% annual return.

The Expense Related Numbers

16.16 times annual spending (previously 13.36)

This is how many multiples of our annual spending we have saved up towards our goal. For example, if this value was 9.1 and we spent $10,000 annually, we would have $91,000 saved up.

64.62% to minimum FIRE (previously 53.44%)

The minimum number to achieve FIRE is 25 times our annual spending. This number shows how close we are to the absolute minimum.

12.76 times annual spending at goal number (previously 10.60)

We’d like to save 25 times our annual spending. This is how many times our annual spending we’ll have saved when we reach our goal number. If it’s 25 or greater, than our goal number will be enough to cover our expenses. If it’s lower than 25, we’ll need to either cut our expenses or increase our goal number.

How Much We Invested

-28.33% Month to Month Change In How Much Saved (previously 70.36%)

This number shows the change in what we saved in our investment accounts this month compared to the prior month.

-29.82% Month to Month Change in How Much Saved With Employer Contributions (previously 52.26%)

Same as the prior number, but with employer contributions counted.

1.12% Month to Month Change in 12 Month Savings Average (previously -9.78%)

This number shows the change in our 12 month rolling average. This helps to smooth out months over time.

0.75% of 12 Month Average Net Income Invested With Employer Contributions (previously -9.49%)

Same as the prior number, but with employer contributions counted.

How we track the numbers

I’ve been using Empower (referral link) to track our numbers. I put them into a spreadsheet that calculates the numbers you see above.