Winding Down Summer and July 2023 Financial Results

Welcome to Rich Frugal Life’s July 2023 financial results! Before we get into the numbers, here’s what we were up to this month.  

Summer is over and I’m back!

School is officially back in session, which means that summer is coming to an end. Well, not the hot temperatures. It will stay above 100 degrees here for another month or two (unfortunately).

This summer, I did something a little different… I actually unplugged and spent time with my family.

If you regularly follow this blog, you may have noticed the lack of blog posts. While I did feel the self-inflicted pressure to publish more often, I knew that this summer it was more important for me to slow down and spend some quality time with family.

Your kids are growing up before your eyes

There is a statistic I’ve seen floating around the internet lately that says, by the time your kids are 12 years old, you will have spent 75% of all the time you will ever spend with them. By age 18, that percentage increases to 90%. Pretty sobering, right?! I can’t find the original source, but it seems like a reasonable approximation.

Our daughter recently turned 7, which means our time with her is limited.

After reflecting on this, I started making more of an effort to spend quality time with her, even if it means not accomplishing all the things I think I should be doing.

Sometimes I get caught up in everything I want to accomplish, instead of focusing on what is most important. Afterall, one of our primary reasons for pursuing FIRE and for my early retirement was to be actively involved in our daughter’s life and spend more time as a family.

And you know what? Despite blogging less and not accomplishing much on my own “to-do” list this summer, slowing down and focusing on my kid made me feel whole lot better!

Someday, I’ll find my perfect balance, but this was a good step in the right direction.

That said, with more free time on my hands now, I’m excited to spend time blogging again.

Another family vacation

This month, we took a week long road trip to southwest Colorado, staying in Durango and Telluride.

It was wonderful to escape the heat one last time before school started.

Southwest Colorado is beautiful and we really enjoyed our trip! There’s too much to share here, so I’m giving this trip it’s own blog post later this month. Stay tuned…

Public Service Announcement: Don’t trust strangers on the internet

Recently, it’s come to my attention that my Instagram account has been cloned by at least one fraudster pretending to be me. I think copycats are supposed to be a sign that you’ve made it, right?

They blocked me, so I had no idea. Who knows how many other fake accounts are out there. Nonetheless, fake accounts are both annoying for creators and dangerous for unsuspecting followers.

Many of these fake accounts copy the Instagram account they are pretending to be. They follow and message followers of the copied accounts trying to scam folks into making sketchy investments or providing other personal information.

I will never message you to promote any investment schemes, especially not sketchy ones. Nor should any other self-respecting public figure in the personal finance space.

You already know that we prefer “boring” investments, like total stock market ETFs. Keeping it simple is probably best for most investors. It’s certainly helped us surpass our FIRE goals.

Not everyone is as honest as we are though, so this a your friendly reminder: Don’t trust strangers on the internet. And, if you are friended by a suspicious imposter account, please block them and report it so the account can be taken down. Thank you.

Without further ado, here are our July 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. 

July 2023 Financial Results

Investments

We made a net investment of $11,176 to our Financial Independence (“FI”) portfolio during the month.

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

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

Debt

We currently have $159,200 in debt, all of which relates to our mortgage.

Our mortgage has a fixed interest rate of 2.5% since we refinanced multiple times when rates were low. That is way less than the 4.3% our high-yield savings accounts are currently paying!

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

Savings Rate

Our after-tax savings rate this month was 77%.

That’s pretty close to our average, despite taking another week-long vacation during 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.

July 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 – $783

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 – $451

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 – $356

Food spending was way under budget again this month. Yay!

We went to Colorado for a week, so that accounts for one week’s worth of eating (recorded within the Travel budget).

The rest of this savings probably came from only buying what we need at the grocery store (it’s too hot outside to stock up) and using my ButcherBox referral credits to pay for the meat/seafood we purchased.

Mr. RFL and I enjoyed one date night out this month at one of my favorite local restaurants. However, only $40 of the bill hit this month’s expenses since we used a previously expensed gift card to pay for the rest. We also went on one coffee date.

Household Consumables – $91

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

This month I bought some new makeup and toiletries. Even though I rarely wear a full face of makeup these days, most of what I had was a couple years old and needed to be replaced.  

Utilities – $256

Utilities include electric, water, gas, and security. 

We were gone for half of June, so our air-conditioning bill wasn’t too bad this month. It will be much higher in August.

Internet – $55

Our internet promotional deal with Cox expired this month, sending our potential bill much higher. Mr. RFL took care of it though, getting a new deal to reduce our internet bill again, with just a few minutes of effort.

Fuel & Car Maintenance – $264

We both filled up our cars once at home this month, spending $100. Any gas fill ups during our road trip went to the Travel budget.

Mr. RFL also renewed the Arizona registration on his car for two more years this month.

Alcohol – $215

After not spending much in this category over the past few months, we stocked up on wine during an awesome sale at Fry’s. This amount purchased us 21 bottles of wine and a couple 6-packs of craft beer!

Travel – $937

This covered the remainder of the costs for our week in Southwest Colorado.  

More details about this trip in a future post.

Entertainment & Learning – $25

This category is for TV, 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).

Self-care – $209

I purchased new running shoes this month. It’s been a few years since I replenished my beloved Brooks. I’ve been a loyal fan of the brand for years, although my running mileage is admittedly much lower than it used to be. These are my favorite running shoes, but I need the added support for running since I overpronate, so only use them for non-running activities.

Mr. RFL also bought a new pair of running shoes, as well as another pair of sneakers that will stay clean and be used for workouts done inside the house. We are a no shoes in the house kind of family. (affiliate links)

Since these purchases were strictly for the purpose of exercising (and we have other sneakers for casual wear outside the home), I decided to recorded them under the self-care budget.

Clothing – $207

A good portion of our clothes shopping this month was (surprisingly) for Mr. RFL. We did a full restock of his casual tee shirts this month, swapping out for his more worn items.

I also did some shopping this month (unsurprisingly), picking up another hoodie, pair of shorts and sports bra during Vuori’s summer sale. I’ve been slowly replacing my older/frumpy casual wardrobe with new clothes that I love. And I love Vuori!

I’ve already made a couple more discounted purchases from Vuori in August, so you’ll see another high spending month for clothes in next month’s report.

Yes, this time I’m including an affiliate link. Vuori lowered their general new customer offer to 10%, but you should be able to get 20% off your first purchase of $150 of more with this link.

Kid Activities & Other Purchases – $415

This month, we shelled out $119 for gymnastics classes, as well as $125 for a week of summer camp.

We also spent $145 on back-to-school supplies, including a new backpack, lunch bag, a few Bentgo lunch boxes, and the required school supply list for our daughter’s school (affiliate link).

Cash Back Rewards

We received $98 in cash back rewards in June.

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.

July 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 $2,340. Here’s a breakout of how that money was earned:

I show referral credits from my ButcherBox review here in the “Other income” section for transparency. However, since those credits are received as discounts on my future orders (i.e. they reduce grocery expenses), I don’t actually treat them as income within our budget or use them when calculating our savings rate.

That’s all for our July 2023 financial results. How’d your summer go?

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Featured image by Rich Frugal Life

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