Picking Up Trash and March 2023 Financial Results

Welcome to Rich Frugal Life’s March 2023 financial results.

Before we get into the numbers, here’s a little bit about what we did last month. 

Finding purpose in giving back

While most discussion about charitable giving in the personal finance community revolves around giving money, giving your time can be just as impactful.

Since leaving my corporate career 3 years ago, I’ve been looking for ways to better connect with and give back to my community. It’s a personal value that Mr. RFL and I have identified as being important to us, but where we felt like we were lacking.

Giving money is great, but I often feel disconnected from the process. While I know the money we give benefits the charities we support, studies show that giving boosts your sense of well-being more when you can see actually the impact of your efforts first-hand.

In pursuit of this goal, I joined three local non-profit organizations this past year, two as a board member. While it took a little while, I’m finally beginning to feel the purpose and joy of spending my time helping to better my community. Maybe this was some of that “purpose” I had been looking for.

In addition to these formal roles, we’ve enjoyed supporting our local “Buy Nothing” group over the past few months. Giving something to a neighbor feels way better than the couple bucks we might have earned selling that item, or just dropping it off at a donation box.

We’ve also recently started taking “trash walks” around our neighborhood and surrounding trails, picking up litter as we go. This was actually our 6-year old daughter’s idea, which fills my heart with joy. This month we bought her a trash grabber (affiliate link) to reduce the ick factor of our neighborhood beautification walks. It’s also upped the fun factor significantly.

Overall, I love this feeling.

So many dividends (and interest)

Quarter-end months are the best months… at least when it comes to investment income.

March marks the end of the first quarter of the year, so there was a big payout this month. We made $4,211 in dividends and interest!

Our quarterly investment income was $7,116. That’s enough to cover 61% of our actual year-to-date expenses!

Any expenses that we can cover with investment income will lower the amount of investments we need to sell to fund our lifestyle in early retirement.

Some of this income is from our retirement portfolios, so will continue to be reinvested (and inaccessible) in early retirement. However the majority (75-80%) is from non-retirement sources. We’ll be able to use it right away when the time comes. It’s exciting to watch this number grow each year as our portfolio grows.

Without further ado, here are our March 2023 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 an 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. 

March 2023 Financial Results

Investments

We made a net investment of $21,300 to our Financial Independence (“FI”) portfolio during the month.

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

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

Debt

We currently have $163,200 in debt, all of which relates to our mortgage.

Our mortgage has a fixed interest rate of 2.5%, which is LESS than the 3.6% our high-yield savings account currently pays, so we have no plans to make additional principal payments anytime soon.  

Savings Rate

Our after-tax savings rate this month was 81%, which is about average for us these days.

March was a more expensive month than last, but the quarterly dividends received on our portfolio this month helped to offset most of the increase.

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 a period of time. Although we currently pay a lot in taxes each year, it’s because we’re still earning a high income. We expect to earn and pay much less in early retirement.

March 2023 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, as we don’t share that information publicly. While we do budget for donations each year, we don’t like to treat charitable giving as an “expense” against our budget (to encourage more giving.)

Housing-Related – $790

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. 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 – $1,065

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.

This month is higher than usual because we paid the annual premiums for our general liability and umbrella insurance.

Food – $1,186

March was an expensive food month for us!

We continued to overspend on restaurants, but it doesn’t bother me much, because it has all been intentional and in line with our values. This month’s restaurant outings included three dinner/lunch dates, a visit to our local craft beer pub, a coffee date, a family lunch outing, a “mom’s night out” event, and supporting a couple local food trucks at community events.

Our grocery spending was also above average this month, but that is after a couple below average months. Plus, I made an expensive (as usual) trip to Costco.

Household Consumables – $73

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

Spending this month was primarily for Costco-sized toilet paper and other consumables.

Utilities – $244

Utilities includes electric, water, gas, and security. Winter is our cheapest time of year here in Arizona.

Entertainment & Learning – $55

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

This month our spending included the cost of our regular streaming services (Spotify, Hulu, Amazon Kids+ and Disney), as well as the entry fee to a community event.

Travel – $0

Flights have only increased from their already too-high prices, so we still haven’t booked the airfare for our larger summer vacation.

All the research says that prices should come down as we get closer to the date (and we’re tracking flight prices on Google). However, prices have only been moving in the wrong direction so far. Buying flights at weird times or with connections seems to be cheaper, but we’ve decided that the savings aren’t worth the extra time and hassle to us when travelling with a kid. At some point we may just have to bite the bullet and pay the ridiculous prices.

Clothes – $36

Undershirts and a couple tank tops.

Child Care – $233

Prepaid for after-school care through April. This is an optional cost for us, but our daughter seems to love the extra play time after school so we decided to let her stay another month. 

Kid Activities & Other Purchases – $140

Monthly dues for Gymnastics classes and several pairs of summer shorts from Target.

Furniture, Tools & Other Home Purchases – $89

In addition to the trash grabber (affiliate link) we bought for our neighborhood trash walks, the rest of this month’s spending was for plants, seeds, organic pest deterrents, and potting soil for my garden.

Other Spending– $94

This month’s miscellaneous costs primarily include software renewal fees and investing fees related to Mr. RFL’s equity compensation.

Cash Back Rewards

We received $117 in cash back rewards this month.

Since these ultimately represent reductions of the purchases we make, I decided to reflect them as a reduction of expenses this year, rather than as income.

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

March 2023 Financial Results: Other Income

While the majority 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.

The total non-employer related income earned this month was $4,364. Here’s a breakout of how that money was earned.

That’s a wrap on our March 2023 financial results. How’d your month go?

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