Welcome to Rich Frugal Life’s June 2024 financial results! Before we get into the numbers, here’s what we were up to last month.  

Relaxation and escaping the Arizona heat

Staying cool is the number one goal for summer around here, where temperatures tend to hover between 105 and 115 degrees from June through early September. It may be a “dry heat,” but I don’t enjoy feeling like I’m roasting in an oven. Humidity arrives with monsoon season in July, which makes going outside even less pleasant.

To reduce the misery, most people try to escape town for as long as possible while school’s out of session. Mr. RFL still works in an office setting and we are naturally homebodies, so this typically ends up being 3 – 4 weeks max for our family.

This year’s summer adventures began in late June, with a trip east to Charlottesville, Virginia (and the Blue Ridge mountains).

As I’ve mentioned on the blog before, we don’t plan on staying in Arizona long-term. For the past few years, we’ve been evaluating potential future hometowns and planning for our next move once Mr. RFL is ready to leave his current job.

Charlottesville has been on our radar for a while now. Despite the fact that neither of us have ever actually visited the area, it seemed to check off most of the boxes on our wish list. There are so many pros, but still a few cons. One being that the city is a little smaller and more isolated than some other places we’re considering. We decided it was time to check it out. I think we were both sorta hoping that Charlottesville wouldn’t live up to our expectations so we could cross it off the list and narrow our choices down… but we absolutely loved it.

Charlottesville was just the first stop on a 16 night vacation. I’ll share more on our trip and the related costs in July’s recap.

Q2 Dividend Payouts

Quarter-end months are always strong, but June and December contain additional payouts from funds that only pay out their dividends semi-annually.

We made $6,834 in dividends and interest during the month of June. That’s 53% higher than last year!

Year-to-date, we’ve earned $18,954 in total investment income (interest and dividends), which represents a 41% increase over last year.

With Mr. RFL still working, we continue to pour money into our brokerage accounts, so I expect to see these numbers to continue to climb until he retires. It’s comforting to see the significant passive income stream that we’ve already amassed, which will cover a good portion of our expenses in retirement.

Changes up ahead….

Once again, it was really nice to have a formal break from the (self-imposed) obligations of blogging this summer.

If I’m being honest with myself, I haven’t enjoyed my time here as much over the past year as I did in the very beginning. Life has gotten busy. While I love writing, this is not my priority anymore. It’s been challenging to find the time just to keep up with the monthly recap posts, which has left no time to write about the topics that I’m more passionate about. Spam comments annoyed me to the point that I just shut down the comments section, which has further made it harder to connect with readers.

I’m not ready to abandon the blog, but I am going to try to reformat the monthly financial updates so they take me less time to write. Maybe with that free time, I’ll find my passion again to explore other FIRE and personal finance-related topics. Either way, thank you for reading.

Without further ado, here are our June 2024 financial results, with all the juicy details of this month’s spending, passive income, savings rate, and investments.

Why share the details of our spending and finances?

Because I’m nosey and enjoy reading about other people’s spending habits and net worth.  Maybe you do, too.

Everyone’s financial situation is unique.  However, I believe there is value in sharing information to provide context and normalize the discussion of money.

Seeing other people happily embrace simpler lives gave us the confidence to begin our own journey to financial independence and a lifestyle we believe will be healthier, happier, and more fulfilling.  I’m just trying to pay it forward.  Sharing our finances each month also helps us stay accountable.

Other information useful in reading our monthly financial results

Did we just buy a money pit?

We bought a complete fixer upper in late 2018… with a toddler.  When we moved across the country for Mr. RFL’s job, housing costs were much higher than we were used to.  So, we decided to just go for it when we found a great deal on a fixer upper.

We’ve been working on projects ever since, trying to do as much as we can ourselves to learn some new skills and save money.  Since the costs of a whole home renovation are significant and non-recurring, we don’t include them in our monthly expense budget.  However, we do share renovation costs each month for full transparency.  

How we define an “expense”

The table below shows all expenses for the month, excluding renovation costs.  Principal payments on debt are not included.  As a former accountant, I don’t view principal payments as “expenses,” since they directly reduce debt and increase net worth.  We don’t anticipate having any debt in retirement. 

June 2024 Financial Results

Investments

We made net investments of $20,725 into our financial independence portfolio during the month of June.

A portion of these investments came from leftover cash from prior months’ options sales with the rest being funded by our current income and savings.

Our reported investment number includes employer matches but does not include reinvested dividends and interest.

Here’s a break-out of the new investments we made this month:

Debt

We currently have $148,100 in debt, all of which relates to our mortgage.

Our mortgage has a fixed interest rate of 2.5%, which is a lot less than the 4.25% our high-yield savings account currently pays.

We’re taking advantage of the interest rate arbitrage while it lasts and won’t be making additional principal payments anytime soon.  

Savings Rate

Our after-tax savings rate this month was 67%.

Although June was a high dividend month, we experienced higher than usual expenses during the month related to travel and a couple one-off charges.  

We calculate our savings rate after taxes, because we believe this gives us the best insight into our true cost of living.

Including taxes would skew our expenses and savings rates when comparing over time. Although we currently pay a lot in taxes each year, that’s because we are still earning a high income. We expect to earn and pay much less in early retirement.

June 2024 Financial Results: Monthly spending

Ok, full disclosure time! The table below shows our expenses for the month, along with some additional thoughts (or excuses).

*Does not include charitable contributions made. We don’t share that information publicly and prefer not to treat charitable giving as an “expense” against our budget to encourage ourselves to be more generous (since we tend to want to manage and reduce “expenses”).  Additionally, approximately half of our annual giving is now made from the Donor Advised fund we opened in 2022, which is already excluded from our net worth.

Housing-Related – $789

Housing-related costs include mortgage interest paid, and a monthly allocation for property taxes, insurance, and HOA dues. 

We’ve refinanced our home several times over the past few years down to a rate of 2.5%. Because of this, and since we had been paying extra all along, our loan-to-value ratio and mortgage payment are now quite low.

Insurance – $463

This category includes our premiums for auto, term life, personal liability, and health insurance.

Health insurance premiums are withheld from Mr. RFL’s paycheck, but all our other insurance plans are paid annually or biannually.  We allocate an amount for auto insurance each month since the cost is high, but other insurance premiums are included here only when they’re actually paid.

Food – $363

We came in way below our food budget for June!

This month, I challenged myself to minimize shopping and use up the food already in our pantry and freezers. Grocery purchases for the month were only $256, which was primarily for fresh produce and dairy.

We left for a 17 day long vacation near the end of June, which helped keep food costs a little lower as well.

Restaurant spending was only $107, which we spent on one family dinner outing, one night of take-out, fancy ice cream, and a coffee.  Because we tend to (guiltlessly) over-indulge on vacation, we intentionally kept our dining out and drinking lower during the first three weeks of the month in preparation.

Household Consumables – $14

This category includes most of the non-food consumables used in our household, such as toilet paper, shampoo, skincare, laundry detergent, cleaning products, etc. 

Utilities – $207

Utilities include electric, water, gas, and security. 

Home Maintenance – $219

Most of this money was spent to have the carpets throughout our house professionally cleaned. We also picked up a few maintenance items from the home improvement store.

Car Maintenance – $1,013

After years of hardly any maintenance or repair costs, my car has cost us quite a bit this year. This month was the latest challenge. The air conditioning in my car stopped working so we brought it in for a repair. It was the compressor, so not a cheap repair or one that we would even want to attempt to DIY. Air conditioning is not optional in Arizona.

My car is now over nine years old, so higher repair and maintenance costs are to be expected. And I’m still happy with how low they’ve been so far.

Medical – $11

Prescription to ease my anxiety for our upcoming air travel. I have a terrible fear of flying, and can’t believe I waited so long to ask for something to help. It worked perfectly.

Alcohol – $68

This month we paid for our Cooper’s Hawk wine club membership and some local craft beer.

Travel – $2,532

Travel costs for our summer vacations continued in the month of June. We paid the remaining lodging costs for our trip back east, along with food, gas and activities for the first 8 days of our vacation that occurred during the month

Entertainment & Learning – $45

This category is for television, streaming music, books, games, concerts, and other family activities.

We paused Netflix this month due to our planned vacation but did pay for our regular streaming services from Spotify and Amazon Kids. Mr. RFL also bought a new book he had been wanting.

Self-care – $30

Cash tip for a facial I received this month (the facial was previously paid for).

Clothes – $24

Bought some undergarments.

Kid Activities & Other Purchases – $236

This month we paid for gymnastics and Girl Scouts. Our daughter was thrilled to finally get out of her car seat and move into the big-kid booster seat that we purchased (affiliate link). We also bought her a kid’s watch (analog) and pair of sandals.

Furniture, Tools & Other Home Purchases – $12

My only home purchases this month were a cheap pink beverage tub (bought while aimlessly wandering the nearby stores during a kid’s birthday party) and reuseable travel bottles for our trip.

Cash Back Rewards

We received $118 in cash back rewards this month.

Since these ultimately represent reductions in the purchases we make, we now reflect them as a reduction of expenses (rather than as income). Travel hackers are always bragging about how little they pay for vacations, but the reality is that they are making a trade-off between earning cash back and earning points to pay for travel. That’s not to say that the trade-off isn’t better for anyone who travels a lot and has the time to maximize points. It’s just different, so this is how I like to view the trade-off for our personal finances.

We strategize the timing of expenses and charge everything we can to maximize credit card rewards. However, we always pay the full balance due each month.

June 2024 Financial Results: Other Income

While most of our income still comes from W-2 wages and related employee benefits (i.e. 401k match), we’re continuing to build our passive and other income streams.

Here’s a summary of our Non-Employer Related Passive & Other Income for the month:

The referral credits from my ButcherBox review were $350 this month, which is a lot higher than recent months. While I show these referral credits above for transparency; I don’t treat this money as income within our budget or when calculating our savings rate. That’s because credits are only redeemed as discounts off my future ButcherBox orders, which effectively just reduces our grocery expenses.

That’s a wrap on our June 2024 financial results. Hope your summer has been amazing!

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Featured image by Rich Frugal Life (Views from a hilltop orchard near Charlottesville, VA)

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