Welcome to Rich Frugal Life’s April 2023 financial results!

Before we get into the numbers, here’s a brief update on the month.  

Oops… I forgot my anniversary

No, not the one that I share with my wonderful husband. I’m talking about the 3rd anniversary of my early retirement! It officially passed in March and I completely forgot about it until now.

Three years is a long time, but it doesn’t feel like it’s been that long since I ditched my corporate accounting career for financial freedom and a simpler life.

Perhaps I missed this milestone because I was so busy with my part time, seasonal gig last month. Or maybe it’s because early retirement and the changes it brings has become less of a novelty and more of a way of life.

While I have typically written an early retirement update post each year, I don’t feel like I have a whole blog post’s worth of things to say this year. So here you go…

Update: My third year of early retirement

I am still beyond grateful to have the freedom to choose how I spend my time, without worrying about a paycheck. I have found no shortage of ways to fill my days and still have a “want-to-do” list longer than the time I have available.

In this third year, I remained focused on health, although I backslid a little and gained back a few of the pounds I’d lost in that first year of early retirement. The money situation has remained a non-issue, as we’ve continued to save money at a high rate, even after reaching financial independence last year.

Increasing my involvement in the local community this year has helped me to find more purpose in every day life. Finding purpose in early retirement is something that I struggled with all three years. It’s also the reason I decided to give it a go with the above mentioned part-time job.

However, I’m finally beginning to see things a more clearly as I enter my fourth year of early retirement.

More on my semi-retirement experiment next week…

Without further ado, here are our April 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. 

April 2023 Financial Results

Investments

We made a net investment of $21,800 to our Financial Independence (“FI”) portfolio during the month.

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

This month, we moved some money around to better align with our targeted portfolio allocation after our first quarter review. Recent changes to the holdings offered in our 401k plans held with a previous employer have reduced real estate and international stocks below our targeted range.

During April, we moved some money within our other retirement accounts out of total stock and total bond funds into these asset classes to get closer to our target. We’re probably still out of range but will reassess our allocation again in June.

Because of these changes, the chart below is a little skewed, as we ended up with a net outflow of taxable bonds which is not clearly reflected herein.

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

Debt

We currently have $162,200 in debt, all of which relates to our mortgage.

Our mortgage has a fixed interest rate of 2.5%, which is LESS than the 3.75% our high-yield savings account currently pays, so we will not be making any additional principal payments anytime soon.  

Savings Rate

Our after-tax savings rate this month was 63%, which is actually pretty low for us.

April was a more expensive month than usual. This is primarily due to the airfare costs for our upcoming summer vacation. The extra spending was planned and we’re still saving far more than we need to, so I still feel good about where we landed for the month. 

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.

April 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. Although we 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 – $788

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 – $449

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 – $746

After blowing the budget in March, we came in under budget for food in April.

This month’s outings included two fancy family lunches and two coffee dates.

Household Consumables – $200

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

I was actually surprised to see how high this number was for April. This month, I received a huge Amazon ‘subscribe and save’ order, filled with earth-friendly kid toothbrushes and toothpaste, various sunscreens, deodorants, as well as body wash, face wash, and serums from my favorite “clean” skincare brand (affiliate links).  

I like to stock up on heat sensitive items, such as skin care products, pantry staples and wine before the weather gets too hot here. Things delivered during the summer in Arizona often arrived melted and/or spoiled. 

Utilities – $207

Utilities include electric, water, gas, and security. This was officially our cheapest month of the year.  The air conditioning is now on… it’s all going downhill from here.

Fuel & Car Maintenance – ($124)

This category was a bit strange in April because I received a mileage reimbursement from work. Mileage reimbursements are intended to offset the costs of fuel and car maintenance. However, we had no charges in either of these categories this month, so the result was a credit (income).

Entertainment & Learning – $32

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 addition of Apple+ TV. We’ll keep this service for just a couple months to watch the newest season of Ted Lasso (love that show!) and anything else that seems interesting before we cancel again.

Self-Care – $25

I joined a local pickleball club in April. This is real, folks.

Travel – $1,831

The ridiculously high price of three airline tickets to North Carolina this summer.

We could have saved a little money if we had purchased a flight with stopovers or during odd hours. Although I wish airline prices weren’t so high right now, the convenience of flying direct and during the day is worth the added cost to us… especially when travelling with a 6-year-old.

Clothes – $405

While there were a few items for Mr. RFL in here, the majority of our clothing purchases this month were for me.

This is one of those cases whereby calculating the “real” cost of anticipated purchases actually led to me buying more things. Oops!

For the last two summers, since losing 30 pounds during the first year of my early retirement, I’ve continued to wear my cheap, oversized workout tops and shorts every day in the summer.

I recently decided that I don’t want to feel frumpy anymore! When I wear clothes that don’t make me feel good, I tend to make poor decisions with regard to the things I eat and how I use my time.

So, this summer, I decided to eliminate all my clothes that are too big, too old, or that just don’t make me feel beautiful. I bought a few pairs of shorts, tank tops, and tees in my current size to replace these items.

I also bought a couple of cute pickleball skorts, because they make me feel happy and confident when I hit the courts.

Child Care – $99

We scaled back on after-school care for May, but have kept a few days for our daughter to enjoy the extra play time with friends before school gets out.  

Kid Activities & Other Purchases – $445

This month’s kid costs were primarily spent on monthly dues for gymnastics and enrollment in a week-long summer camp.

We also got our daughter a couple 20oz stainless steel water bottles and let her buy a Disney princess toy she really wanted, although we had her use money from her piggy bank for that one (affiliate links).

Furniture, Tools & Other Home Purchases – $804

We took the plunge and bought a wood console from Costco for our living room. I’d been lusting after it for months.

“Didn’t you just buy a living room console a few months ago,” you ask? Why yes. Yes, we did.

Unfortunately, this frugal girl talked herself out of the more expensive piece at the time, thinking she’d (maybe) be just as happy with something way cheaper from Wayfair. While there’s nothing “wrong” with the first console we purchased, it is much more casual and cheaper looking than the what I really wanted for our living room. I’m in my 40’s now, so I feel like it’s okay for me to want real furniture.

This is your reminder that cheaper isn’t always better. We ultimately ended up with the piece that I wanted, and I love it! However, it cost us an extra $200 more than if I’d just bought this one in the first place. You live and you learn.

Cash Back Rewards

We received $141 in cash back rewards this month.

Since these ultimately represent reductions in 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.

April 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.

Total non-employer-related income earned this month was $1,285. Here’s a breakout of how that money was earned.

I expected to see lower dividends and investment interest this month.

What I didn’t expect when pulling together our April 2023 financial results, was to see the big increase in referral income earned from the blog. It’s Rich Frugal Life’s highest earning month yet. This income all came from my ButcherBox review, which I updated for 2023 last month. Technically it’s not taxable income, since the bonus is a cash discount off future purchases, but it saves me money off food I’m planning to buy anyways so I’m thrilled. If you are one of the people who used my link to give ButcherBox a try, thank you!

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

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Image by Peter Dargatz from Pixabay

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