May 2020 Spending and Net Worth Update

Pre-tax Savings Rate: 56.0%

For details on savings rate calculations and budget category breakdowns, see my Guide to Net Worth Updates.

Income (+64.37%)

Why heeeellllooo full-time employment! It feels SO GOOD to get back to receiving a paycheque after subsisting on side hustle income for the past two years. I’m tracking my gross income, including all employer benefits, because I want a good feel for what I’m getting out of being a wage slave. When you look at net pay it feels like so little; honestly looking at my full compensation before tax has been a little humbling. Yeah, I know it’s not that high an income, but after coming off of two years of frugality at about 33% of what I’m taking in now, it’s a pretty big leap.

While I am no longer receiving CERB since I’m back to work, my husband is still eligible, as our side hustle is still on the bench due to COVID-19 restrictions on social gatherings — not a big demand for birthday party catering right now. Also we got a one-time $900 bump to our Canada Child Benefit as part of the government’s COVID-19 response, so that’s $2900 of additional government income above the norm this month.

Decluttering income is higher this month because I discovered I had cash languishing in my paypal account from a few things I sold on eBay… I’m pretty bad at not checking my online accounts. In January I had almost $500 languishing in a Square account. Oi. I think I got them all now.

“Other income” this month was people paying me back for shopping I did on their behalf (captured in this and other months under the “misc” expenses category), and for insurance paying back a portion of my health expenses.

Category This month Last month Difference
FULL-TIME JOB 6,496.97 6,496.97
SIDE HUSTLES 127.50 (127.50)
GOVERNMENT 4,077.42 6,352.70 (2,275.28)
DECLUTTERING 171.06 10.00 161.06
INVESTMENTS 53.63 81.62 (27.99)
OTHER 228.78 137.19 91.59
TOTAL INCOME 11,027.86 6,709.01 4,318.85

Expenses (+58.12%)

While my income went up, so did my expenses, to the tune of over $2k. This is all due to paycheque deductions… contributing to my defined benefit pension plan and CPP, group health and dental insurance, and other employment expenses (EI, long term disability insurance, life insurance, union dues… the fees go on and on). And, of course, taxes. It’s friggin’ expensive to be an employee.

Housing costs were slightly higher this month as the weather was nice and that means house repairs. We didn’t have too many repairs to do; just needed some wood to repair some sections of fence.

Transport costs were slightly up compared to last month, but still down compared to what we usually spend (we filled the car ONCE, after not filling it at all in April). Considering I’ll be working from home 4/5 days a week until at least the end of the year, I can’t see us buying a lot of gas in the months to come.

Food costs were lower, and closer to what I’d like to pay each month. We have a lot of pantry supplies still, so we’re mostly buying fresh and frozen food to supplement the pantry. Misc expenses this month were loaning money to others by doing their shopping and being paid back later.

Business expenses continue despite COVID-19; our fledgling Research & Development business currently lives in our workshop, so we could keep pecking away at it during the pandemic.

Category This month Last month Difference
TAXES 852.20 852.20
SHELTER (incl. insurance) 885.15 779.72 105.43
TRANSPORTATION 390.75 330.01 60.74
FOOD & CONSUMABLES 950.88 1,513.82 (562.94)
UTILITIES 414.31 414.31
INSURANCE (health, life, data) 418.69 418.69
HOUSEHOLD 20.13 128.66 (108.53)
CLOTHING, SHOES, ACCESSORIES (not work related) 22.98 22.98
HEALTH 86.10 74.13 11.97
EDUCATION 524.46 (524.66)
PET EXPENSES 12.35 12.35
ENTERTAINMENT 14.18 9.19 4.99
GIFTS TO OTHERS 28.74 11.64 17.09
BUSINESS EXPENSES 171.08 193.79 (22.71)
DB PENSION + CPP 1,646.20 1,646.20
MISC 123.35 97.10 26.25
TOTAL EXPENSES 6,500.77 4,111.30 2,389.47

Balance (+74.27%)

Well, last month I said I didn’t think I would ever save as much as I did that month, and here we are socking away an additional $1,929.38 above last month! Now I kind of want to keep pushing that barrier and save even more next month… but that’s not a game that can go on forever, lol. We’re pretty frugal already, and with no side hustle income due to COVID-19 I can’t really push the income side of things. But who knows!

Category This Month Last Month Difference
INCOME 11,027.86 6,709.01 4,318.85
EXPENSES 6,500.77 4,111.30 2,389.47
BALANCE 4,527.09 2,597.71 1,929.38

Net Worth (+2.60%)

MILESTONE ALERT! Our net worth has passed the $200k barrier! Woohoo! That’s the highest it’s ever been since I started tracking in August 2018, almost 2 years ago. Granted, 89% is in fixed assets (house and car), but it still feels pretty good.

With the extra savings, we’re implementing our plan to contribute as much as possible to RRSPs to maximize our CCB payments next year. I have about $35k of contribution room, and want to get as close as possible to maxing it out this year and claiming an epic deduction.

Category This Month Last Month Difference
ASSETS 293,889 289,547 4,343
Liquid (Cash, HISA) 18,371 16,981 1,389
Semi-Liquid (TFSA, RRSP) 3,828 710 3,118
Fixed (house, car) 271,690 271,855 (165)
LIABILITIES 92,061 92,842 (781)
Auto Loan @ 3.99% 7,904 8,207 (303)
Mortgage @ 2.69% 84,157 84,636 (478)
NET WORTH 201,828 196,704 5,124

Assets Not Counted in Net Worth (+2.40%)

As a new addition this month, I’m going to add assets I don’t count in my net worth: my pension plan and my kids’ RESP.

Why the pension? Well, if I FIRE I’m going to take the commuted value out of my pension and put it into a Locked In Retirement Account (LIRA). They’ll give me the amount of money that would need to be invested in a tax-sheltered account today to grow to the amount needed to give me the pension benefit I was entitled to at retirement age. It’s a messy calculation that depends on market conditions at the time it is calculated. For now, I’m just going by what my employer and I put into the pension plan each month; the commuted value may be more or less than this, but it’s a solid number I can use, at least.

Why the RESP? Well, because I want to see how it’s growing over time as well, and it will offset any future education costs I would’ve had to pay for my kids. And if the doodoo hits the proverbial fan, I can always withdraw the funds I originally contributed, even though I’d lose the government match. I can’t see myself ever doing this though. In my mind this money is long gone to the kids already.

Category This Month Last Month Difference
PENSION ESTIMATED VALUE 91,221.84 90,119.98 1,101.86
RESP 19,485.72 19,534.43 (48.71)

Your Money Or Your Life Wallchart

I’ve been diligently looking at my wallchart each month, even though this is the first update where I include a picture of it. I find it incredibly motivating to see the income and expenses lines diverge, knowing that the gap between them is leading to my freedom. I look at the chart several times a week, and it definitely motivates me to both increase my income and reduce my expenses.

The FIRE income estimate line is a bit of a bummer though… it’s barely off the x-axis. This is the line that I need to cross with my expenses to reach financial independence. Right now my liquid/semi-liquid investments would give me $74/month. To make even a blip in the chart (to get it to, say, $500) I’d need to invest another $127,800… oi.

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