I can’t believe it is the middle of summer already. I just saw next week’s sales paper advertising back to school supplies! Is August really just around the corner? Time flies when you’re having fun, right?
We have been busy with home-based activities for the most part since our big summer travel plans were wrecked this year. It’s usually hot most days so we try to get outside during the morning and evening when the weather is more bearable. In the middle of the day we have plenty of indoors activities to keep us entertained. I’ve been engrossed in a new (to me) computer game for the past few weeks.
Between fun pastimes, routine chores, and small projects around the house, summer has been fulfilling. Although we love to travel, this is a nice forced break from our normally busy summer schedule of full time travel.
Financially speaking, June was a good month for us. Our net worth climbed $41,000 to end the month at $2,063,000. Income was relatively decent at $6,244 while our expenses came in well below budget at $2,311 for the entire month.
Let’s jump into the details from last month.
Investment income totaled $3,518 in June. Our equity index funds and ETFs pay dividends quarterly at the end of March, June, September, and December with some payments arriving at the beginning of the next month. For the first week of July we have already received an additional $4,000 in dividends so it’s looking like the second quarter dividends payments are doing very well! Here’s more on our dividend investments.
Blog income, shown as “other income” in the chart, totaled $1,799 for the month which was slightly higher than last month. That’s not bad at all given how infrequently I post these days.
My early retirement lifestyle consulting income (“consulting”) was $673 for the month of June which represents five hours of consulting. After dropping to almost nothing in March, my consulting business is slowly recovering as the stock market recovers and people focus once again on early retirement.
The “deposit income” totaled $252. The biggest chunk of this money was $200 from Natural Light. Yes, the beer that’s popular among cash strapped college students. They had a promotion where you mail them your college diploma and they mail you a check for $100. They plan to use the diplomas for an upcoming marketing campaign.
Mrs. Root of Good and I both mailed in our diplomas and we both got PAID! We still haven’t received our diplomas back but did I mentioned we got PAID?!
In other “deposit” income I got a random $14 refund from my auto insurance company that reflects their lower than average claims history during the spring months when people weren’t driving as much. I like free money (even if it’s just giving me back my own money).
Rounding out the random free money we received, I snagged a $3 refund from Chase Offers for shopping at Food Lion (our neighborhood grocery store). I don’t pay a lot of attention to these offers in general but I happened to catch this one.
We also received $35 that came from cash back and incentive bonuses from the Ebates.com and Mrrebates.com online shopping portals (some of which was earned from you readers signing up through these links).
If you sign up for Ebates through this link and make a qualifying $25 purchase through Ebates, you’ll get a $10 gift card.
If you’re interested in tracking your income and expenses like I do, then check out Personal Capital (it’s free!). All of our savings and spending accounts (including checking, money market, and five credit cards) are all linked and updated in real time through Personal Capital. We have accounts all over the place, and Personal Capital makes it really easy to check on everything at one time.
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Tracking spending was one of the critical steps I took that allowed me to retire at 33. And it’s now easier than ever with Personal Capital.
Now let’s take a look at June expenses:
In total, we spent $2,311 during June which is about $1,000 less than our regularly budgeted $3,333 per month (or $40,000 per year). Insurance and healthcare costs topped the spending categories for the month.
Detailed breakdown of spending:
Insurance – $890:
Our annual home insurance bill totaled $618. Our six month auto policy premium totaled $247 for two drivers plus a teen on a learner’s permit. The teen added no cost to the policy (for now).
Farm Bureau, our insurance company, also charges a $25 per year membership fee. Overall they are still the lowest priced insurer that I’ve found.
Healthcare/Medical – $539:
Our 2020 healthcare premiums are $123 per month thanks to very generous Affordable Care Act subsidies that we receive due to our low ~$40,000 per year Adjusted Gross Income. The benefit of being “poor” on our tax return.
I have been paying $19 per month for my monthly dental insurance premiums for 2020. Mrs. Root of Good found out she needed some dental work done soon, so we bought a policy from the same insurer for her for $45 per month with higher coverage amounts. There is no waiting period on basic services so we are hoping the insurance will pay almost $1,000 for Mrs. Root of Good’s upcoming procedure.
It’s been a rough month for dental care. I had to get a few cavities filled. Fortunately I bought dental insurance this year. I calculated that the insurance would be cheaper than paying cash for two regular cleanings and exams plus one set of x-rays. The few hundred dollars saved on fillings makes this insurance an even better deal! My out of pocket copays for the fillings totaled $352. These were the first fillings I have needed in many years so I guess I was due for some patching up.
Taxes – $300:
Our quarterly estimated state income tax payment.
Groceries – $286:
Grocery expenses are much lower than normal. I used some Walmart and Amazon gift cards that I bought in previous months to offset some of June’s grocery expenses.
We consumed a lot of the supplies we accumulated during the spring as the pandemic took off. As it turns out, food supply interruptions were pretty minimal and it’s back to usual for the most part. Except we still can’t find our regular toilet paper and napkins at Lidl.
Utilities – $163:
The city water, sewer, and trash bill was $138 for June.
The natural gas bill (for the water heater and furnace) totaled $26 for the month.
In February I paid $602 for electricity which left us with a huge credit balance. I still have about $150 of that credit on the account right now but that will undoubtedly get used up in a month or two since we are staying at home all summer.
The electric utility charges a $1.50 convenience fee to use a credit card so I usually charge a big lump sum at one time so that the convenience fee is negligible as a percentage of the payment. These big payments help me hit credit card minimum spending requirements for new sign up bonuses too.
If you want to score free travel or big cash back from credit cards, there are several cards currently offering 50,000 points or more. These points can be redeemed for $500 cash or $500+ in free flights or hotel stays. Compare travel and cash back credit card deals.
Charitable Giving – $50:
We gave $50 to a GoFundMe for our son’s classmate. The kid needed surgery out of state for a severe ongoing medical condition and the parents don’t have a lot of resources on their own. So we chipped in a little bit to help offset lost wages from missing work during the trip and the direct expenses of traveling up the east coast and staying in a hotel for a week.
Gasoline – $31:
I think the last time we bought gas was in March. The minivan was down to a quarter of a tank near the end of June. Fill ‘er up! I suppose we’ll have to get gas again around September.
Home Maintenance – $30:
$28 for a replacement burner element for our glass cooktop in the kitchen. I decided to save money and buy a used replacement part off of ebay. The part was selling for $150 brand new so it seemed like a good gamble to buy something used that might last 5-10+ years. If the replacement part dies before the cooktop dies, I’ll just spend another $28 on a new replacement element.
Swapping out the burner element is pretty simple. It only requires a screw driver and a set of pliers (and turning the circuit breaker off before commencing work!).
I also spent $2 on a gallon of gas for the lawn mower. That should last us for the next couple of months.
Cable/Satellite – $18:
We pay $18 per month for a local reduced rate package due to having a lower income and having kids. 30 mbit/s download, 4 mbit/s upload.
Travel – $6:
I paid our state income taxes with a credit card and the convenience fee works out to 2% of the amount paid. I get a lot of airline and hotel miles from credit card sign up bonuses so I consider the extra expense to pay with a credit card as a “travel” expense.
Total Spending for 2020 – Year to Date
Half way through 2020, our spending totals $15,225 for the year. This is almost $4,800 less than the $20,000 we budgeted for six months of our $40,000 annual early retirement budget.
The year is turning out to be a little more expensive than I thought it would be. We spent $3,700 in May on a new tankless water heater. That expense wasn’t totally unanticipated but the cost was a bit higher than I was expecting. It’s working well so far so we are happy. And that’s what we saved our money for – paying for comfort and convenience.
During June and July we will end up spending around $2,500 on various dental procedures and office visits for the two adults in the household. Our dental insurance should pay close to half of that expense for us. In any event, this will be an expensive year for dental care.
The higher home maintenance and dental costs will be offset by lower travel spending. Our travel spending will be close to zero for 2020 because we have cancelled two cruises and our entire 8 week trip through South America. We have been able to receive a promise of a refund on all the canceled lodging, fights, and cruise fare but getting the money in our hands is taking a very long time.
So far so good though! We cancelled eight airbnbs in South America and got a 100% refund on all of those even though four of them had a “strict” cancellation policy that stated we would only get a 50% refund. Since I was cancelling a couple months ahead of time, the hosts were okay refunding in full since they could potentially re-rent the properties.
In other travel news, we planned on visiting Spain for two weeks in October. It looks almost certain that we will have to cancel this trip given European travel restrictions for Americans. We have until the end of July to cancel the flights for free so we will make a decision in the next few weeks.
Monthly Expense Summary for 2020:
Summary of annual spending from all years of early retirement:
- 2014 – $34,352
- 2015 – $23,802
- 2016 – $38,991
- 2017 – $31,708
- 2018 – $29,058
- 2019 – $25,630
- 2020 (year to date) – $15,225
Net Worth: $2,063,000 (+$41,000)
June left us a bit wealthier than we were in May with a solid $41,000 gain. The month started out really well and we saw an almost $150,000 jump in our portfolio in the first week of June! It settled back down by month end to leave us with $2,063,000 in net worth. I include the portfolio value plus the paid off house value in the net worth calculation.
I didn’t make any investment moves in June other than watch all those quarterly dividend payments roll into our accounts. That’s the way passive investments should be!
We’re trucking right along over here at the Root of Good house. Everyone remains in good spirits. Except our super bored eight year old. But there is nothing anyone can do to alleviate his suffering!
This pandemic really messed up our normal summer routine. But I like to remain optimistic. We have a (paid off) roof over our heads, plenty of food on the table, and an ample supply of money to make life comfortable and entertaining. Unless you are eight and super bored!
Mentally, I’ve come to accept the uncertain future. In terms of traveling, I don’t know when we will be able to do any big trips overseas again. 2021 perhaps?
In terms of schooling, there is still a huge question mark for the August return to school. The school district moved up the first day of school to August 17th. We are less than six weeks away at this point. They just announced the official reopening plan last week.
Per the school district, the plan is to have a third of each school attend for one week. Then that third stays at home for two weeks for distance education. During week two, the next third of the school goes to class once the first group rotates to distance ed at home. Then the final third goes to class during week 3 (after the first 2 weeks of doing distance ed at home). Week 4 starts the whole cycle over.
It’s an interesting concept that could certainly help reduce the spread of the virus. But as our local case counts keep on rising I don’t see how any schools here will be able to reopen and have a chance at remaining infection free for long.
The district also offers a parallel education in the form of a fully remote “Virtual Academy”. We can sign up for a semester or the whole year. Since both of us parents are at home all the time anyway, this fully remote option is certainly tempting in terms of reliability, health, and safety. We haven’t seen a lot of info about any of our options yet. Now it’s time to play the waiting game.
It’s a lot to think about. This is another time when I’m very glad that we chose the route of early retirement. Having two full time stay at home parents makes the decision to go with the safer fully remote option a lot easier. Most parents don’t have the lifestyle flexibility that we do.
Regardless of which schooling path we choose, we will make the most of the experience. Life goes on, and we’ll keep on making the choices that make the most sense for our family.
Well folks, that’s it for this month’s update from Root of Good. Hope to see you again next month!
How is your summer going? Keeping busy and staying cool?
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