Our second quarter was filled with 3 fun mini-vacations and of course the start of summer break! I was laid off (planned seasonally) the first week of May. This is a blessing in that it gives our family a lot of time for summer fun and saves us from even having to consider the massive summer daycare costs for 2 – 3 of our 4 kids. The downside of course is that I don’t have any income coming in.
Total spending for the year so far ended up at $29,400. This works out to $4,900 per month, over $1,600 per month over our target. Yikes!
Here’s a breakdown of our top 3 categories:
Health: Right at the end of the quarter healthcare spending took a big hit as we found out we needed to start our 9 year olds orthodontics earlier than expected. I had hoped we could hold off until he was around 12, at which point our oldest would be done with orthodontics and our house would be paid off, or at least really close. This was $695 to start and will be around $200 a month for a year…for phase 1. Our oldest should start his phase 2 sometime this year, doh! So far this year we have spent $5,109 on medical expenses, not including our insurance premiums. This has been a rough year for medical costs.
Groceries: Our Grocery expenses so far are at $5,304. The first half of this year I have done a poor job of separating out grocery, gas, and general merchandise expenses. We do a lot of shopping at Meijer and everything gets coded in Personal Capital as grocery. I think the true cost of actual groceries is closer to $4,500.
Entertainment: $2,300 for tickets to Disney! Completed funded through saving the earnings from this website. I also paid the $293 for our tickets to the Kennedy Space Center. There were a few smaller expenses in here to for zoo trips, movies, etc. Total for the category is at $2,850 for the year.
Once I finished up my spring outage season I upgraded our backyard monkey bars to include 2 flip bars and a pull up bar. The kids love it and it only cost around $50. I then built a Gaga ball pit in the backyard for the kids, mostly from reclaimed lumber I got for free. Total cost for this project was $42.
We took a trip over Memorial day weekend to Toledo, OH. One the first day we drove from the other side of Michigan and visited the Imagination Station Science Museum, followed by Nickel World, a nickel arcade, and then we went to Bellvue, OH and visited Jungle Junction. Admission to Imagination Station was free with our membership to The Museum and Science and Industry ($80 savings). The museum is a lot of fun and I highly recommend going there for anyone within driving distance. It’s not nearly as large as the Museum of Science and Industry, but they do an extremely good job with their exhibits. We spent around 3 hours there. We packed a picnic lunch and ate at our van in a nearby parking lot.
We left the Imagination Station and drove to Nickel World, a nickel arcade in a strip mall. There is a $2.50 admission fee to get in, but all games are either 5 cents or 10 cents to play. Best of all? They have a free games section on the back wall which includes Area 51, one of my favorite games from my childhood (that cost 2 quarters per play back in the mid 90s). All of the games were in functioning order and the staff were very responsive to any issues.
After spending a couple hours at the arcade we took the kids on an hour drive to Bellvue Michigan to Jungle Junction, a massive indoor playground. Think of a large McDonalds playplace, but 5 times bigger. The cost for admission is only $6 per kid and free for adults. The kids had a blast here. My only complaint is that the area is set up to be a large with air cannons in the middle on all levels to shoot foam balls out. The air system that powers the vacuums for sucking up the balls to the second level and powers the cannons on the upper levels was not functioning.
We then drove to the Hampton Inn in Bowling Green, OH, which is about 30 miles south of Toledo, OH. This hotel was 15,000 points to redeem, which is on the low side for Hilton brand hotels. My employer typically books us at Hampton Inns, so I rack up a lot of these points. We got 1 room and we have these 2 small air mattresses that I take with and the little kids sleep on. The hotel was clean and they have a pool. We went swimming in the morning before taking our trek to the Toledo Zoo.
Never, I repeat, NEVER go to a zoo on a Holiday weekend, especially with high temps. This place was insanely crowded and HOT. I thought this might be a good training mission for the kids for Florida, however when we went to Universal Studios you would receive a respite from the heat if you went into a building. Not so at the Toledo Zoo. I’m willing to bet that it was actually hotter inside the Aviary and Reptile house at the Toledo Zoo. A northern Ohio zoo is not built for 94 degree days. Most of the animals were lethargic due to the heat and people were in our way everywhere. Overall the zoo looks really cool and they have some animals we don’t get to see very often, most notably Elephants and Bears. I’d like to go back on a mild weekday sometime.
After the zoo we stopped at a park where you can dig for fossils, totally free and fun, unfortunately it was still ridiculously hot while we were there and we only rock hunted for about an hour, I could spend all day there.
Trip 2: Return To The Museum Of Science and Industry
This was our 3rd trip since starting our membership late last year. On this visit we went to the new Pixar exhibit and on the Coal Mine tour. I’ve literally wanted to go on the coal mine tour all my life. We went to MSI with my school 20+ years ago and on field trips we don’t do the “extra stuff”. Since then we had taken 2 trips to MSI, but both times were on a budget and we weren’t footing the bill for extras. Buying a membership is a great way to get these things included. All of the kids had a great time visiting the museum.
Trip 3: COSI Museum in Ohio.
At the end of the month we headed down to Ohio to visit my Grandma and great grandma in southern Ohio. On the way down we stayed the night in Columbus, OH at the Quality Inn + Suites. We got a 1 room suite that has 2 Queen beds and a sofabed. The stay was excellent and in the future we will be using Choice hotels a lot more. The room was only 12,000 points and the hotel was 15 minutes from COSI.
COSI is another Science Museum and is often at the top of “Best of” museum lists in the country. We got in free with our membership to the Museum of Science and Industry. This place is about as large as the Museum of Science and Industry however it seems possible to do all the exhibits in 1 day. We got there 20 minutes before they openned at 940AM and stayed to around 3. We skipped 3 exhibits, 2 being the special exhibits with extra costs. We also didn’t do any of the movies or the Planetarium.
We then went to my Grandma’s house in southern Ohio. She has a creek in her backyard and the boys love hunting for rocks there (as do I). I grabbed a couple 3 X 4 pieces of slate that I am going to make a couple outside tables from. On this visit I told the kids about how when I was little Grandma would always get us a box of donuts from Jolly Pirate donuts in Waverly, OH and the donuts came in a treasure chest box. They closed down several years ago, but after this conversation I did a Google search and found that they still exist with 5 operating locations. On our next visit we will make the extra hour long trek into Kentucky for some of the best donuts in the world served out of a treasure chest box.
Our total savings for the year is at $15,879. Here’s the breakdown:
- 401K: $8,295
- IRAs: $0
- Taxable brokerage: $0
- Extra On House: $4,800
- Increased Cash: $2,784
This quarter our savings was largely down due to me being off work for May and June. I am fairly confident our total yearly savings will be more than the $32,000 that it appears we are on track for. In the 2nd half of the year we won’t have nearly the medical expenses we have had so far because we have hit our deductible on our health insurance plan and we won’t be paying for a trip to Disney. I think it is likely we will hit $36,000 in total savings this year.
I’m holding off on putting more cash on the house until I know what my Fall work schedule is going to look like. It isn’t set in stone yet, so I want to be conservative with my cash until I know for sure how much work I will have.
Saving a large portion of our income comes from 4 basic decisions:
1. Keeping house expenses low: Our total housing costs are only 10.3% of our net after tax income. This is 20% below most guidelines.
2. Keeping vehicle expenses down: We pay cash for our vehicles are drive very modest vehicles compared to our income and net worth. Our total vehicle value is only 8.8% of net income and only 2.8% of our net worth.
3. Optimizing taxes: I use my tax planning spreadsheet to optimize our taxes. We contribute a lot to tax deferred accounts, which is able to keep our AGI low. A low AGI means a lower tax bill, lower Obamacare health insurance premiums, and the ability to qualify for the retirement savers tax credit.
4. Bank raises: As our income has increased we have saved the vast majority of those increases.
Our overall savings strategy is to ensure we hit a certain AGI target to avoid falling off an Obamacare cliff. To do this we need to put every dollar earned over that amount into pretax retirement accounts. All leftover savings then goes on the house. This should end up with us having a rough 50:50 split on total savings this year. We had to preload my 401K because the employer I work for in the fall does not have a 401K account available.
Our total net worth increased by $27,910 this quarter to $329,786. A big change here is the value of our homes. I hadn’t updated these in over a year and needed to re-evaluate them. A house very similar to ours just went on the market for $205,000, and it only has 1.5 acres instead of 11 acres, and has no river access. Properties in our area on average have increased 5.6% this year, so with these 2 data points I felt comfortable adding $10K to our home value.
Our rental house is another story. My brain is still stuck on 2011 when we had horrible luck selling our house. We originally listed it at $64,000 and got no bites. We dropped it to $58,000 and received an offer right away, but the deal drug on forever and then fell apart. In 2011 our county had 15 months of inventory on the market, today it has only 4 months of inventory on the market. Anyways when we refinanced in 2015 we had an appraisal come in at $76,000 which I didn’t buy, but it served its purpose. While looking for comparable recent sales and current listings there is nothing of this houses size and condition going for $60K, Honestly $70,000 to $75,000 is probably closer to accurate, so I updated my spreadsheet to reflect this.
Our cash is WAY down due to 3 issues:
- We just started Orthodontics for Kid #2
- We paid $2,300 for our 6 day Disney Tickets while they were on sale at Undercover Tourist.
- I have been off work for 2 months. When I am off work we tend to burn around $1,500 per month over our income.
I track my investments with Personal Capital and using my own spreadsheets and charts. All of my accounts are linked to Personal Capital, so I can quickly see how I am doing overall without having to log in to a half dozen different accounts. So far this year our return is only at 2%. Right now you can get a $20 Amazon gift card for signing up for a free Personal Capital account and linking at least 1 account to it if you visit through this link.
We have continued to pay an extra $300 per month on our house and will be making another large payment towards our mortgage early in quarter 3. I think a payoff date of December 2021 is our most likely finish on our primary residence with our rental house following 6 months later. We bought our home in the fall of 2011, so this plan has us paying off our home in 10 years total.
I track my mortgage payoff with a mortgage spreadsheet I created. With how long term the goal of paying off my house is, I made this spreadsheet to help keep me motivated. It shows me exactly how many months I have taken off my mortgage and how much interest I have saved to date. If I never make another extra payment I have already taken 10 years off my mortgage and saved over $40,000 in interest. The slight discrepancy between the end of month number on this chart and the total balance remaining I reported above is due to the actual date our extra house payments come out on.
Skymiles and Points:
Skymiles balance: I just cashed in virtually all of my Skymiles for hotel stays at our Disney trip. We don’t have a high demand for flights, as my employer directly pays for all my work flights and Mrs. C. has no desire to ever get on a plane. Add in that we would need 6 tickets to go anywhere as a family and our Skymiles are much better spent on lodging, even though the cents/mile is much better for flights. When I had previously looked into using my Skymiles for hotel stays it looked like I had way more than enough accrued because we could rent either a 2 bedroom hotel suite or a 3 Bedroom home for around 13,000 miles per night. Now the pricing is well over twice that, which greatly cuts into the utility of these miles, doh! We paid around 27,000 points per night for a 2 Bedroom hotel suite.
Choice Points: We are in the process of racking up Choice points for future vacations. Our Choice Privileges Visa card has no annual fee and we use it for virtually all of our expenses. After booking our hotel for our visit to the Kennedy Space Center, we are at 46,289 points.
Hilton Honors: We have 107,000 Hilton Honors points. Most Hilton hotels are in the 20K to 35K range for redemption. There are 2 hotels for 10K points that are strategically located for us. 1 in Bowling Green, OH which is perfect for trips to Toledo, Detroit, and Cedar Point, and 1 in Seymour IN which is a little past halfway to my parents house. Having 107,000 points then gives us about 5 – 10 free nights. I will continue adding to this balance as my employer often has us staying in Hilton hotels.
Action Economics Earnings is still lagging what I would like it to be, but is still pretty darn good for a mostly passive side hustle. and speaking of mostly passive, I will soon be dropping my posting frequency down to 1 post every other week from the current weekly posts I have been doing. This will take a bit of pressure off of me and should increase the quality of the articles as well. April was a low earning month due to fallout from when my website was hacked back in February.
April Total: $65.57:
- Amazon: $30.77
- FlexOffers: $34.80
- Google: $0
May Total: $257.56:
- Amazon: $89.56
- FlexOffers $0
- Google: $0
- eBates: $23
- Spreadsheet Sales: $45
- Sponsored Posts: $100
June Total: $369.88:
- Amazon: $115.15
- FlexOffers: $0
- Personal Capital: $20
- Google: $110.73
- Spreadsheet Sales: $24
- Sponsored Posts: $100
How has your 2018 been so far? Any fun summer vacations?