July ended up being a much better month for my budget than I expected. Expenses came in at their lowest amount so far this year which is great I had been averaging almost $300 more than my goal. Total expenses for the month came in at $2,511.09 which was a nice move down after they jumped back up during June. I'm glad that expenses came back under control this month although I don't expect to be able to cut too much more from them as long as the debt payment (refrigerator/furniture) is still there. Grocery and restaurant spending both came in above budget but the good news is that they were at fairly manageable levels. I was only a combined $30 over budget on those two which are typically the two areas I'm in the red on each month. I still need to work on getting these lower for financial and health reasons. Convenience foods are expensive for both the budget and the body. My average monthly expenses declined from $2,638.12 to $2,619.97. A nice $20 improvement.
Well, July is a slower dividend payment month so my passive income coverage dropped back down from June's level. I received $208.80 in dividends and another $4.98 in interest giving a monthly expense coverage of 8.79%. That's a slight increase from April 2014's 8.53% coverage thanks mainly to lower expenses and a slightly higher dividend income. If you count all non-day job income then my potential retirement income was actually $569.20 thanks to $355.42 in online income. That gives a 23.40% expense coverage. As a dividend growth investor seeking financial independence, I'm primarily concerned with the dividend/interest expense coverage so there's still a lot of work to do on that front.
My FI Income, monthly income based on the 30 year US Treasury bond yield of 3.31% using my net worth excluding traditional retirement accounts, came in at $701.96. That was about a $16 decrease from the end of June which is completely due to a falling net worth as you'll see when that post comes in the next few days. My FI Income for July covered 28.86% of my expenses which is a slight increase though thanks to lower expenses.
*Minimum Expenses are only the expenses related to rent, utilities, car, food, minimum payment on debt and other necessities. In other words, the required amount of replacement income I would need for financial independence.
*Total Expenses are the total monthly outflow of money.
*Potential Retirement Income is income received from dividends, interest, cash back from credit card purchases and any other source of income not related to my job.
*FI Income is my liquid net worth invested at the 30 year treasury bond yield at the end of each month divided by 12 to get monthly income.
|Category||Budgeted Amount||Actual Amount||Subtotal|
|Debt Payment (Fridge)||$300.00||$300.00|
**Expenses shown above are only expenses that I paid for. My wife and I have split our expenses up due to my job having me out of town most of each month. The current split is around 65/35.
Overall I'm pretty happy with the way the month turned out and now I just need to build on the progress from July and keep it rolling through the rest of the year.
I've updated my Progress page to reflect July's changes.
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How did you do on your budget for the month? Is there anything you're going to focus more on in August?