Budget Check & Cash Flow Update - July 2018

Budget | Cash Flow | Personal Finance
Budget Check & Cash Flow Update - July 2018

The saying goes that cash is king.  While that's true, a more accurate saying when it comes to finances is that cash FLOW is king.  Whether you're retired, still working or just starting out the only way you can improve your financial house is to have positive cash flow.  

If you're in the accumulation phase then that positive cash flow allows you to save and invest to build up your future cash flow.  If you're already retired, or FIREd, then congratulations because I'm sure your cash flow is well above what you need.

We've been fairly lax in regards to our budgeting, but the time is right to really get things moving forward.  One of our big goals for 2018 is to focus on our monthly spending.  When it comes to personal finance it's rather simple income - expenses = savings and savings x investing = financial independence.  There's obviously two main levers there and while we'd all like to increase our income, many times reducing expenses is some of the low hanging fruit that you can go after to increase your savings.

Budget Check

Total income dipped slightly in July; however, it was still very strong at $7,432.15.  Expenses saw a huge jump during July up to $6,024.93 which is a far cry from the average monthly expense figure of a little over $3k.  Expenses might have seen a big jump; however, that was primarily due to the family trip that we took down to the Cayman Islands at the end of July which was $3,066.76 of the total expenses for the month some of which will be paid back to me via family.  Without the travel expenses included the July's outgo would have been $2,958.17.

Obviously, my savings rate dipped in July due to the travel expenses and slightly lower income; however, it was still a win in my book since we were able to fund the week long vacation through our normal monthly cash flow.  Based on total income (pre & post tax work income, taxable dividends, interest) I still had a 19% savings rate during June.  Based on work income alone the savings rate was 16%.  Excluding the travel expenses, which aren't normal expenses, the savings rates would have been 60% and 59%, respectively.
Budget | Cash Flow | Savings
Budget Check July 2018
*A few notes about the budget check.  All income is only income that I receive and does not include my wife's income likewise for the expenses.  We've found it's easiest for us to just keep separate accounts since I'm gone most of the time for work.  Also, pre-tax withholding for the 401k (I currently withhold 6% in order to get the full 5% employer match) and the ESPP through my employer (8% post tax withholding) are not included in the above savings amount.  

Non-Work Cash Flow

Each month I like to examine the state of our non-work cash flow.  Since our goal is to become financially independent the monthly cash flow has to come from somewhere in order to cover our expenses.  

Truly passive income, dividends and interest, totaled $291.17 during July which was about a $25 decrease from April.  *Dividends are from my taxable accounts only.  

Based on July's spending the passive income for July covered 6% of expenses.

Thus far in 2018 I've totaled $3,699.66 from income outside a traditional day job.


One thing I'm certain of is that life is what happens when you're busy making plans.  Our big plan for the year was to reduce all of our non-mortgage debt in order to free up around $900 of monthly cash flow.  It's been slow going on that front because life just kept happening and our planned travel for the year required us to set cash aside.  Now that our big family vacation is done and and no other travel or big expenses on the horizon we can really start to focus on debt reduction.

I still think there's an outside chance of getting rid of the two big non-mortgage debts that we have before the end of the year.  Although it might be close.  Whether they're gone in 2018 or early 2019 I won't really care as long as we're making steady progress on it and moving forward.  Even better is that as soon as they're gone we can build up some cash for a month or two and then resume investing in earnest.

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How is your monthly cash flow situation?  What are you doing to increase your savings?  Are you focusing more on increasing income or reducing expenses?


  1. Hi

    I think u sould also live life, sometimes a vacation is very needed. Why have a lot of money if u are old and cant enjoy vacation without pain :)

    Cool grafs btw. I also made som graf at my site but not with a budget check

    Greeting from Sweden


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