A Year’s Worth of Groceries & Other February Expenses

Is it already March?! February certainly flew by. I can’t say that we accomplished too much since January, other than spending way too much on groceries. “A year’s worth of groceries” may be a stretch… but we’ve got enough to eat for several months.

Mr. RFL’s approval to work remotely finally ended, so he had to return to the office for work. I definitely enjoyed the extra family time and ability to take a mental break from parenting every now and then while it lasted. Back to early retirement homeschool parenting.

Let’s just jump right into it. Today, I’m sharing our February finances, with all the details of this month’s spending on groceries & other expenses, passive income, savings rate, investments, and changes in net worth..

Why share the details of our spending and finances?

Because I’m nosey. Seeing the inner details of other bloggers’ spending habits and net worth gives me a thrill. You, too? I won’t tell anyone.

Everyone’s financial situation is unique. As such, you probably shouldn’t judge your own financial progress based on what others have achieved. However, I do believe there is value in sharing information for context.

We’ve been motivated by the number of people in the FI community who’ve happily embraced simpler lives. Seeing others succeed 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.

If you’re looking for the frugalist of the frugal, you won’t find that here. Life is short and we have no problem splurging on things that make us happy. However, while we spend freely in these value areas, we’re trying to ruthlessly cut back everywhere else. We call this “value-spending.”

Sharing this information each month helps us stay accountable to our goals, and hopefully provides you some context as well.

Other information useful in reading this report

Did we just buy a money pit?

We took a risk and bought a complete fixer upper in late 2018… with a toddler. When we moved across the country for Mr. RFL’s job, we chose to live close to his work for a shorter commute and better quality of life. Unfortunately, real estate is expensive here.

When we found a great deal on a fixer upper that had a lot of potential, we decided to go for it. 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 this is a whole home renovation, the costs are significant and non-recurring. We don’t include the costs in our monthly expenses budget as we have cash set aside for this in a renovation SINK fund, but I do share the amounts each month.

How we define an “expense”

Outside of renovation costs, the table below shows all expenses for the month. Principal payments on debt are not included. As a former accountant, I don’t view principal payments to be “expenses” since they directly reduce debt and increase net worth. Our current plan is to have all debt paid off by the time we fully retire.

FEBRUARY FINANCES & NET WORTH UPDATE

Net Worth

We calculate net worth by subtracting total debt & other liabilities from total assets. We include cash, investments, home equity, and an immaterial amount of other assets in “total assets”.

Our net worth grew by 3.5% this month, and 4.1% year-to-date. The growth rates are slowing down a bit, but that’s to be expected as our net worth and investments continue to increase. The dollar amount of growth; however, should increase most months, absent any negative market swings.

I really enjoy tracking our net worth over time and seeing the progress we’ve made on this journey. Our net worth has increased by 21.7% since February 2020, and 52.5% since February 2019.

Investments

Our Financial Independence portfolio, which consists of cash and investments, excluding our renovation SINK fund and daughter’s 529 Plan, increased by 4.9% during the month of February.  

We invested $11,015* this month into our FI portfolio, including company matches, and finished the month with a balance of $729,000…or 58.3% to our FI Number. We were briefly at 60% in mid-February, but the market dip at the end of the month brought us back down.

If you’d like to learn more about our investments, check out the recent post on Our Investment Strategy & Portfolio Allocation. 

_{*If you follow me on Instagram, I accidentally excluded some investments in my post on February investments, which is why the amount invested there is lower.}

Debt

We ended February with $209,800 in debt, $196,200 of which relates to our mortgage. Consistent with our investment strategy, we paid an extra $2,000 towards the principal in the month of February when Mr. RFL received his annual bonus.

For the most part, we no longer make additional principal payments during the year, as we shifted our priorities to investing once we got the balance to $200,000 and refinanced to a lower rate. However, we decided that we will still contribute a portion of any large windfalls (>$5,000) to paying down debt for diversification purposes.  

The remaining debt is for a small project loan for replacing our HVAC systems last year (0% rate), and my student loans (0.75% rate). We only pay the minimums on these balances since the rates are easy to beat.

Savings Rate

Our after-tax savings rate was 77.3% for the month, which is a bit higher than most months as it’s “bonus” month. However, this year’s bonus was quite modest. As usual, we went over budget in some areas, but under in others to offset and ended the month slightly above our budgeted savings rate of 75% for February.

FEBRUARY SPENDING – GROCERIES & OTHER EXPENSES

Ok, full disclosure time! The table below shows our spending on groceries and other expenses for the month of February, along with some additional thoughts (and excuses).

_{*Does not include monthly spending for home renovation from Reno SINK fund of $1,367, or charity contributions made (which we don’t share publicly).}

Housing-Related – $881

Housing-related costs include mortgage interest paid, property taxes, insurance and HOA dues. These costs made up 18% of spending in February.  

We refinanced our mortgage in November to take advantage of lower rates. We paid $855 to lock in a rate of 2.5% on our $200,000 mortgage, which will save us money over the 15-year term. We’ll receive the full benefit of the lower rate this year, saving around $100 in interest each month during 2021.

Insurance – $975

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

We are on a high-deductible health plan that is subsidized by Mr. RFL’s employer, and as such, health insurance premiums are withheld from each paycheck.

We pay our other insurance plans annually or biannually. Because auto insurance is pretty significant, we allocate that out to the budget each month. However, premiums for life and liability insurance are expensed in the months they are paid. Expenses were higher in February as certain annual premiums were paid this month.

Student Loan Interest – $3

Though my parents helped to pay for my undergraduate degree, I graduated with two degrees and $40,000 in student loans. The loans have a low interest rate (only 0.75% for the past several years). Since high-yield savings accounts have historically paid better rates than this, I only pay the minimum. Just one more year and $2,800 left on this loan. Mr. RFL graduated debt-free.

Groceries & Restaurants – $1,207

So…. I accidentally spent too much on groceries again this month. Oops!

We celebrated Valentine’s Day at home, spending $57 on take out from a favorite local restaurant and a nice bottle of wine that we already had on hand.

The rest of the money was spent on groceries!

We continued to order groceries online for pick up or shipping this month, which makes it easier for me to overspend and “stock up.” Just to set the record … we do not eat $1,200 worth of food each month. However, sometimes I buy that much. We currently have a fully stocked pantry and kitchen, as well as two freezers filled to the brim with frozen grass-fed/pastured meats, organic veggies and other freezable staples. In theory, it’s probably enough to meet most of our food needs for the next few months. I’ll keep buying the sales regardless though.

In addition to our normal stock ups, we gave ButcherBox a try this month (referral link – $30 off your first order). The order from ButcherBox cost $150 but included a number of freebies that made at least the first box well worth it (I’m still deciding if we’ll continue to use it). We also stocked up on staples for my new diet from Vitacost (i.e. alternative flours, paleo condiments and other ingredients).

On a positive note, I’ve been cooking up a (healthy food) storm. A few photos included in this post to make your mouth water. I expect spending on groceries to finally be a lot lower in March, as we primarily purchase fresh produce, dairy and some sale items.

Alcohol – $0

We temporarily cancelled our expensive wine club membership and have continued to cut back on drinking, so didn’t spend anything on alcohol in February. Don’t get used to it, though!

Household Consumables – $43

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

We got toilet paper this month! It was so exciting… and then a little sad that finding available toilet paper is something that I now categorize as exciting.

Utilities & Mobile Phone – $296

This includes electric, water, gas, security, internet, and cell phones.

Winter is the cheapest time of year for basic utilities & services in Arizona, and we spent $196 on these.

We were able to get a discount on our internet bill to $42/month last year.

We’ll work on reducing mobile costs, currently $58/month, by switching to an MVNO provider. You’re probably tired of me saying this… someday I will actually get around to doing it! Getting a new iPhone first.

Transportation (excluding insurance) – $15

We just had one gas fill up this month (1/2 tank), which included a $0.80/gallon discount from our Fry’s card.

Medical – $438

It’s official, we’ve now blown way past our medical budget for the year and last year’s annual medical spending with a year-to-date total of $1,567. Our medical budget for the whole year is only $780!

The worst part… I haven’t even had the expected pricey procedures, nor found the cause or solution to my ailments yet (loud sigh…). I suspect our total medical costs for the year will be at least double this.

This is one of the downsides of being on a high deductible plan. We don’t have a choice as it’s the only one offered by Mr. RFL’s employer, and usually it isn’t an issue as we’ve generally had lower medical costs. However, let this be a reminder of why you should have an adequate amount of cash reserves (or emergency fund) to cover unexpected expenses.

Entertainment – $13

This category is for television, streaming music, books, games, concerts, and happy hours. We cancelled most of our television streaming last October and have been staying at home during the pandemic, so these costs remain low. Monthly spending was again just for Hulu and Spotify.

Travel – $600

Unfortunately, 2021 is likely to be another minimal travel year as we await the end of this pandemic, or at least vaccination.

Mr. RFL and I did book an anniversary trip for later this summer to Bryce Canyon and Zion National Park. Travel spending this month was for the hotel deposits, though are fully refundable until the week before our trip. These national parks are drivable and we already have an active National Park pass so the entrance fees will be FREE.

Shopping – $304

This month, we purchased a new memory foam mattress topper, chest freezer for the garage (which is already full), and some tools for Mr. RFL’s home projects. These were partially offset by the return of a couple items from last month. We also now have an extra newish refrigerator to sell that will hopefully cover the cost of our new freezer.

FEBRUARY OTHER INCOME (Non-Employer Related)

While the majority of our income comes from W-2 wages and related employee benefits (i.e. 401k match), we continue to build on our passive and other income streams. The total earned this month was $432.

Dividends

Only $94 in dividends this month. We exchanged a few investments this month (some by choice and others due to retirement plan changes). As a result of these changes, we now expect dividends earned to be lower this year than last year. The new investments pay lower or no dividends but will hopefully provide better appreciation over time.

Interest

We earned $109 in interest this month, primarily from our high-yield savings account and interest earned on Mr. RFL’s deferred compensation investments.

Reselling

Only made $2 this month, which is below my monthly goal. Guess I’ll need to pay more attention to this category and get back into decluttering next month.

Cash Back Rewards

We earned $227 in cash back rewards this month, $103 of which was from normal cash back activity on our credit cards. We always pay the cards off each month.  Additionally, we earned a $100 bonus on a new credit card we opened last month after making our first purchase.

We also received our “big fat check” from Rakuten (formerly Ebates) this month for $24. The big fat checks are smaller now that we don’t spend as much, but I’ve earned $1,607 in cash back over the past 5 years by using Rakuten (referral link).The best part is that I’ve also been able to earn cash back on my credit cards for the same purchases.

If you’ve never tried Rakuten, I highly recommend checking it out! The cash back amounts change daily and can sometimes be as high as 10% or 20% for major retailers. Just be careful that you don’t let the “deals” lead you to spending on things you don’t need. I now only go to the site before making an online purchase. If you use the link above to sign up, you’ll receive $20 after your first purchase of $20 through the site of $20 or more (and I’ll be super grateful).

There you have it… all our spending on groceries and other expenses and a detailed look at our February 2021 finances.

March is the month we’re going to finally spend less on groceries! What are your goals for next month?

Note: This post contains referral links for Rakuten and ButcherBox, two websites we personally use. If you sign up and make a purchase using the referral links above, you’ll support the blog (thank you!) and receive the cash back bonuses mentioned at no cost to you. These links will only work for a limited time after this post goes live.