The Time in the Market expense report – November 2017

Happy Holidays, it’s almost time for Christmas and the roads outside look like an ice skating rink after a night of sleet and freezing rain; that means it’s the perfect time to look at my savings rate and expenses for last month!

I’m not looking forward to walking my dog in a few hours and will have to make sure to put on my ice cleats before going out. Still, I suppose I shouldn’t complain – it could look like this!

One of the takeaways from my Q3 goal review was that I was behind on my savings rate.

It was already well into October when I wrote that so there wasn’t much I could do to impact that month. That means that if I want to hit my bronze goals in the savings rate area, I needed to buckle down and become a frugal Joe for November and December.

Who’s frugal Joe? It’s a guy that’s frugal and the goal for November and December was to emulate him and get that savings rate as close to 50% as possible.

October turned out pretty decent with a 39.8% savings rate which was above my Q3 total but still below my 40% target for the year. That means that November and December will really have to pick up the slack if I’m to hit my goals this year so let’s see how things turned out in November.

One thing to note is that I wanted to change up this month’s report a bit so I’m trying one of those newfangled Sankey diagrams that everyone is in love with these days when looking at my expenses and savings rate. 

Gross Income Savings Rate

On a gross income basis, I saved 39.4% of my income which is one of the best months I’ve had this year. Only February was better and that was because that’s the month I receive my bonus. I generally I bump up my 401k contributions to 50% whenever that happens to really drive the savings rate up and get a big head start on maxing out my 401k.

The addition of employer contributions brings this number up to 44.41%!

The 2017 bronze goal here is 30% so that’s a good deal above that. I was at 28.1% after Q3 so this number will certainly help drive me closer to that goal.

Savings Rate and Expenses

My savings rate for the month clocks in at an impressive 54.58%. Again, that’s the second best month behind February.

That’s a big improvement over last month. It will go a long way to help hit that savings rate goal of 40% for the year.

The savings rate jumps to 61.5% when I adjust for employer contributions.

That’s an awesome result. I’m pleased that I was able to get this number so high without trying all that hard. It all came down to cutting back on some common expenses like going out to eat.

The best part about these results is that I didn’t feel like I was limiting myself.

I still did most of the things I like to do but was more thoughtful about expenses that may impact my savings rate. I was also lucky in that I didn’t have some expenses that have marred the previous months like some high doctor bills and vet costs but it wasn’t all luck as I adjusted for some of the things I can control like restaurant expenses.

Let’s take a look at what drove the savings this month by utilizing the Sankey diagram to visualize the expenses and savings.

I used my actual income below since it better illustrates exactly where the money is going. In future iterations, I may remove the amounts.

The Sankey is pretty great in that it shows exactly where my money is going. It helps me visualize the actual impact of various costs.

One thing of note is that I’m still getting income from my writing side hustle which is cool to see. That’s despite being ultra lazy and not writing much since my last update which spoke of my struggles with sticking with it. It’s definitely something I plan to get back into in 2018 to try to generate some extra income.

Through the Sankey diagram, I can see that most(>50%) of my money is going to savings which is good to see and makes me feel good about this month.

In prior updates, I broke down the expense category on a % basis of overall expenses. However, that’s not a great way of looking at it because it can overstate certain costs. This diagram lets you see exactly how much certain things cost and how that relates to the net income.

As an example, rent made up 38.1% of my expenses this month. That may make people think I spend too much on rent but $956 in a HCOL area isn’t bad. The only reason I’m able to keep it that low is that I split the rent with my fiancee.

The car is my second highest expense making up 18.1% of the overall expenses. That expense is due to my car loan which has about two years left. I’ve been tossing extra money at it here and there. I may actually try to pay off the entire thing in 2018. I have about $7000 left and that will mean I only have to throw about 2k extra at it to get it out of the way. That’ll free up extra cash flow for 2019.

Groceries were next and made up 9.6% of the expenses. That’s probably one of the higher totals this year and coincided with the reduction in restaurant spending.

I’m a frequent visitor of Trader Joe’s and actually love grocery shopping and finding new things to try.

Lately, I’ve been a huge fan of their new almond butter based salad dressing. I’ve been eating a lot of salads for lunch. Greens + nuts + lots of cheese + salad dressing/olive oil = my idea of a good lunch.

The rest of the costs aren’t surprising.

Some key takeaways are that I pay too much for parking since I work in the city. Undauntedly, my company doesn’t offer free parking. On the subject of benefits from work, my health insurance is low these last few months of the year. I got a premium credit late in the year so it’s impacting these months in a bigger way as that’s generally something that’s credited every paycheck.

My entertainment bill was entirely due to Netflix and my Apple Music subscription.

I generally avoided most black Friday sales but I did make a few purchases. There was my girlfriend’s Christmas gift. I also spent a bit of money on clothes this month getting two pairs of sweet Puma sneakers to replace my old ones. The sneakers were on sale from their standard $60 MSPR to $29.99.

Pet expenses were entirely food related. Those are going to jump next month as we had to make a vet visit and put our beautiful doodle on some prescription food to see if we can help her with her allergies. Poor thing is itchy all the time!

The side hustle expenses are related to my blog costs.

Looking forward to the holidays, my family doesn’t do gifts except for the things we get for the kids in the family. That’s great for my savings rate so December might be a solid month as well.

My fiancee and I don’t make a big deal of out Christmas. We prefer small things anyway so the cost there isn’t huge any given year. The older we get, the less we seem to want. The things we want are all things money can’t buy.

That’s it for November’s update. I’m looking forward to see what December looks like. It’ll be interesting to see whether I can use these last two months to help me reach those 2017 goals. I’m a bit behind but November is certainly a good start towards that bronze goal.

Please let me know how you like the Sankey diagram and whether there’s any other information you’d like to see. If you’d like to make your own Sankey diagram, you can check it out here. It’s pretty simple to use and a great visualization tool. If you like the Sankey diagram, please check out others from some fellow bloggers like JumpStartFromScratch, Othala Fehu, GetRichSlowly, Biglaw Investor, Atypical Life, Military Dollar, The Frugal Gene and 99to1 Percent!

As always, thanks for stopping by and I wish happy holidays to all!