How We saved $50,000 in One Year.

Pay yourself first.

Whaatt??? That’s not new. I know! It’s been around for years!

As my dear regulars know, I’ve attempted no spends, low spends, etc. for years trying to save money. My goal was always to stop my impulse spending and to be able to save some cash. Usually, it worked for a couple of months, but then I would ditch it, which in turn, made me feel like a failure.

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This past year, I attempted the Low/No Spend idea again, but got bored with it and fell off the rails. However, we were still able to save a little bit of cash, and in June, my husband and I purchased IBonds with the savings we had in the bank. The IBonds were paying 9.6%!

It was then that I had one of those light bulb moments. I decided to stop focusing on what I couldn’t buy (the spending) and focus on how quickly I could pull together large chunks of money (savings) to take advantage of the new higher rates of CDs.

This new focus changed the way I did the monthly budgeting. I started sending money I wanted to save to Ally Bank before I even paid my bills. Then, after fixed expenses, whatever was left was what we could spend, without guilt. As each month went by, I tried to up the savings amount and lower the spending amount, which in essence turned out to be a low spend anyway (with the added bonus of not beating myself up for buying a lipstick!)

Once the desired savings amount was in Ally Bank, I quickly transferred it into a non-penalty CD. (Interest rates aren’t huge for the CDs, but they are finally adding dollars (and not pennies) to the bottom line.) And, because it was in a CD, I was less inclined to pull the money out for something I really didn’t need. It absolutely worked, because after 12 months, we now have an extra $50,000** dollars in our cash savings accounts!

Our plan is to retire in early 2024, and I’m excited to keep up with my savings goals!

Have you been taking advantage of the CD and savings rates?

**Having said all of the above, I must mention we are empty nesters. We do not have college tuition payments (anymore!), or other child expenses. My husband is at the top of his game with income. This is our last push towards adding to our savings before my husband retires in 2024. Also, I say ‘I’ a lot because I’m the one who handles the bills. The savings would probably be $100,000 if it was up to my husband because he spends literally NO money. 😉

Sometimes plans change.

And in this case, our timeline for retirement. We originally had planned on retiring in early 2023. However, in the course of the last 9 months so much has changed.

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We, like many others, rode the wave of the stock market that was on the rise for the past two years. And in a blink of an eye, two years’ growth was wiped out. We originally had planned to move the money to safer funds but decided to continue to ride the wave instead. We are still far ahead of the game, being that savings rates have been dismal.

History tells us that the market will come back. In the meantime, we have decided to save cash and use some online savings accounts, CDs, and I Bonds, to secure 3 years’ worth of expenses. We also plan to pay off the mortgage within 18 months. That will put us in a much better position if it takes a little longer for our retirement accounts to recover.

However, in order to complete the above plan, we will need to add a year or two to our timeline for retirement. (As you can see from my header, I am no longer putting a definite timeframe on our retirement.)

I know we are fortunate to be able to make that decision. There are retirees out there who don’t have that choice. Hopefully, most of them have secured their savings in safer investments. I know we will start doing that with our investments little by little until we feel secure in the amount we have to live on.

Could we still retire today if we so chose? Yes. But it wouldn’t feel nearly as secure as it did just nine short months ago.

Anyone else holding off their retirement date?

A July Challenge Update….a little late.

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I apologize for this late update, a lot of unexpected stuff came up and my blog fell to the wayside. I closed out July on Saturday, and thankfully it wasn’t as bad as I thought. Spoiler alert: I did not meet my challenge goal.

Let’s just get right to the numbers–

July’s spending:

• Groceries/Eating Out: $623.00
• Personal Care: $182.00
• OTC/Medical: $74.00
• Clothes & Accessories: $395.00 (hubby bought a few items too!)
• Gasoline: $32.00
• Gifts/Spontaneous giving: $352.00
• Mom &Dad: $80.00
• Pet: $66.00 (dog food and misc. accessories)
• Travel (road trips and misc. travel products): $665.00

Total: $2,117.00

I was $1,367 over my goal of $750.00. I can honestly say I do not regret any of the spending. After analyzing the different categories and amounts, I realized that at least $1,000 of the $1,367 overage was for my trip to Italy this September. Planning this trip has sparked so much joy, that I’m not the least bit discouraged from failing this challenge. I’m actually energized and excited for more opportunities to travel, especially in retirement. 🙂

I know some of you were doing the challenge with me, and have been successful! Congrats! Please let me know what you are going to do with all that extra money you saved!

How was July for you?

June Spending: Adding it up.

Every Monday during 2022, I am posting an update on what I spent for the week (variable spending only) as a way of keeping myself accountable for my impulse spending. Also, to see my true savings, I am tracking items I was tempted to buy but didn’t.

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(I thought I would post this a day early)

June is in the books, as well as the first half of 2022. It’s hard to believe how fast this year is going, and also how slow. (I’m anxious, for many reasons, for this year to be over!).

This week’s spending is rather high, mainly because of gift-giving. I was late in getting wedding cards out (to weddings we didn’t attend) and a family friend’s baby. I decided to just get it down all in one fell swoop. Ouch. I also filled up my gas tank on the 30th, and both categories felt a bit like ‘cheating’ before going into July’s challenge, but I wanted to be fully transparent.

Here is the spending for June 27 – 30th:

• Groceries: $121.31
• Eating out: $45.00
• Personal Care: $7.00
• Gifts: $506.00! (2 family birthdays, two weddings, and a baby shower!)
• Gas: $41.65

Total: $720.96

June’s recap of spending by week:

• June 1-6: $1,660.73
• June 7-13: $321.13
• June 14-19: $724.52
• June 20-26: $384.66
• June 27-30: $720.96

Total Spending for June: $3,812.00.

Not the best month, but pretty consistent with my average spending. Hopefully, I can whittle that down to at least half going forward.

How was June for you?

A July Savings Challenge and beyond!

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Anyone up for a good challenge? I am! Especially after reviewing my numbers from the year’s first half! I was shocked to learn that I have been averaging about $4,000 a month in variable spending. Although that average was skewed by April’s unusually high month, it is just too high and does not reflect how we hope to spend our money when we reach retirement.

Since we are tentatively nine months away from our planned retirement, higher cash savings will be key. We have saved quite a bit of money so far this year, but there is room for improvement.

So..I’ve decided it’s time to super-charge our cash savings. For this July Challenge, I would like to limit variable spending to only $750.00. Then, going forward until April 2023, I would like to spend no more than $1,500.00 a month.

That includes the following categories:

• Groceries/Eating Out
• Road trips (excluding actual vacations)
• Gas
• Vet/Dog Food
• Personal care/household
• Gifts
• Clothes
• Personal spending

Spending only $750 in July will definitely be a challenge. I’ve been looking over the categories and trying to plan out where the $750 will be spent.

We have a trip to NY planned, as well as a birthday celebration. Gas for the trip will take up nearly $100 of the $750 (even if we take my husband’s hybrid).

I don’t need clothes, make-up, household items, or gifts in July (just a family party gathering) and I already have hair color to take care of the grey roots.

As far as the dog, I won’t need to purchase dog food either. I still have plenty of kibble left, plus I can supplement with boiled chicken and brown rice. We just need to take care that he stays healthy because vet bills are outrageous. Last month Auggie had a double ear infection that cost us $500. We do have insurance on him, but we have not yet met the $1,000 deductible.

I feel ready for this challenge, but July is a long month. We will have to find things to do that won’t cost money, or at least not very much. (Any suggestions or ideas you may have on how to make July fun while spending very little would be welcomed!).

As usual, I’ll update every Monday with the week’s spending.

Anyone else want to save money with me?