Monthly Financial Progress Report Series: December 2019 -

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Welcome to our December Financial Progress Report!

Back in February 2018, we started this journey of recording our progress towards Financial Freedom. It was important for us to find a way to document our journey and to help us hold ourselves accountable to our goals. This moment is what created our monthly Financial Progress Reports. The progress that we have seen through this journey has amazed us as we continue to find different ways to decrease our debt, make more money and increase our savings options.

Each month we intentionally review and update our financial data after we have received all our final financial statements. Our financial progress reports are then created from the financial data of the previous month. This typically falls within the middle of the month as some bills fall on the 1^st of the month and many others towards the end of the month.

In our Financial Progress reports, you can expect to see an outline and progress updates for our debt, savings, investments, expenses, and income. Also, we will include a small snippet of what we did or what we need to do to improve each area. As time goes on, you can expect these progress reports to evolve and improve as we learn more about taking control and cultivating our money.

Budget

We have been using Dave Ramsey’s Everydollar website as our main budgeting tool. We just love how simple and easy it is to use! Below you will be able to see the main categories that we have chosen to represent where we spend our money. A couple of months ago we added investing as a new main budget category. We have found it important for us to continue to analyze and adjust our budget categories as we develop new financial goals.

Now, what you may not see in this graphic are all the other subcategories that feed into the main categories. For example, our Insurance category includes our multiple insurance policies and their premiums for auto, home, and life insurance. This gives us the ability to learn how much we spend on each insurance policy separately while also gaining an overall total spent on insurance altogether. By taking a few extra tracking steps, we are providing ourselves with knowledgeable information. Especially when it comes time to shop around for better policies. How do you create your budget categories? Have they served you well?

Tacking It A Step Further

In our June 2018 Financial Progress Report, we provided a small snippet of the methods behind our monthly budgeting and tracking. Each month we review our previous month’s expenses and evaluate where we need to adjust the amount we budget for. To keep track of our monthly bills so that they are inputted in our budget correctly, we keep a list of all our fixed bills, their amounts, and their due dates. We make sure that our bills are listed in order from the earliest due date to the last due date in the month. Then, as we pay each bill, we will check off by dating each item paid.

The pay periods for our earned income varies throughout the year. My employer follows a bi-weekly pay schedule consistently throughout the year. However, my SO’s pay schedule transitions from bi-weekly to weekly and then back to bi-weekly. Due to these transitions, it has been important for us to stay organized and continue keeping track of every bill and expense that needs to be paid between pay periods. Doing this ensures that we are paying bills on time or sooner which also saves us money by avoiding late fees and unnecessary interest.

To keep track of every bill in between pay periods, we break our bills down into a weekly duelist. Since our pay schedules vary, this has helped us tremendously in our ability to manage our money. Keeping track of our spending on a weekly, monthly and yearly basis gives us so much knowledge and insight into our spending habits and staying accountable to our money goals.

Now that you have some background knowledge on how we budget, let’s take a look at the overall monthly progress made in October towards our goal of Financial Freedom!

Debt

November 2019 Total Debt: $139,049.51

December 2019 Total Debt: $138,717.55 (-$331.96)

Credit Card Debt: $13,397.20 (-$107.32)

Auto Loans: $14,383.78 (-$224.74)

Student Loans: $110,936.57 (+$0.00)

Despite the holiday season that comes with December, we still managed to decrease our overall debt while also cash flowing Christmas gifts. We are starting to see more progress towards our debt repayment compared to previous months. As we move forward into a new year and decade we really hope to start seeing some gazelle intensity again with our debt repayment goals.

Our path towards debt freedom has really been one of slow and steadiness lately. These past few months have taught us some lessons on accepting the different seasons of our debt-free journey. We understand that not every month will allow us to be gazelle intense but we are surely hoping to experience far more of those in the coming months. During the season of slow and steady, we have continuously been working on methods that can help us transform our money mindset. At the end of the day, we are thankful to have gone through these seasons of financial growth. These seasons continue to remind us that this journey will be worth the freedom we will gain.

Finding the best debt repayment plan

Over time we have learned how to alter our methods and find solutions for our money woes. Every few months we like to evaluate our current debt repayment strategy. When it comes time for us to review our current debt repayment strategy we head straight over to undebt.it.

We love using their FREE debt snowball calculator to track our journey! You only need to have a list of each of your debts, their current total balance, your monthly minimum payment, and your current interest rate. After you provide that information, the calculator will do the rest. You can determine which method will get you closer to debt freedom faster. It is hard to say where we would be on our finance journey if we had not stumbled upon undebt.it. They have helped us gain more focus and clarity when it comes to our debt-free journey.

Overall, this month may have seemed unsuccessful as we added more debt to our balances. However, we choose to look at this as a temporary setback and that our decision making and mindset have changed so drastically. We are still on course to have our credit card debt paid off within the next 15 months and perhaps sooner. Have you ever had to add more debt back to your total balance during your debt repayment journey? Share your story and how it impacted you.

Savings

November 2019 Total Savings: $12,555.40

December 2019 Total Savings: $13,260.70 (+$705.30)

Emergency Fund: $5,856.89 (+$115.24)

Sinking Funds: $1311.79 (+$124.60)

Her Retirement Fund: $6,092.02 (+$465.46)

December allowed us to get back on track with contributing to our savings and seeing positive growth. This is a great relief has it has been hard having to utilize some funds to cash flow unexpected expenses. However, this is a great improvement compared to just a few years ago. Back then, we would have used whichever credit card had the most available credit and continue to make minimum payments until the next unexpected expense popped up. Needless to say, it is amazing to realize how far we truly have come on this journey towards financial freedom.

The last couple of months have helped remind us how much self-restraint we have gained and the amount of positive growth our savings accounts are beginning to have. I truly believe had we not been contributing to savings while also paying back debt, the unexpected occurrences we have had could have had a negative impact on our monthly bill payments. We are so thankful that over time the desire to be truly debt-free and financially independent is helping to guide us in learning more and actually changing our money habits.

Gaining Control of Our Savings Accounts

In May 2019, we moved forward in opening our first high-interest online savings account. The process of getting the account established, making small deposits and setting up automatic transfers has been seamless and practically effortless. We are so glad that we took action in setting up this account as these small actions have led to better interest earnings than any of our other savings accounts combined. Did I mention that this account has a smaller balance than my other savings accounts?

As we enter into the next year we will be moving forward with setting up additional high-interest savings accounts for our various sinking funds. Some of the sinking funds are really savings plans to allow us to cash flow needs or want guilt-free like a vacation or getting Invisalign. To help us stay on track and remain accountable, we plan to set up automatic savings contributions to each designated sinking fund. We are excited to continue to see growth in our savings contributions. Finally deciding to set up automatic transfers to deposit into our savings accounts has been the best decision so far. How did setting up automatic contributions impact you!

We are just so thankful for the opportunities that we have been given to develop better money habits. Our development efforts have started to help us make smarter financial decisions. We look forward to continuing to find ways to save more money and grow our savings passively.

Investments

November 2019 Total Investments: $158.38

December 2019 Total Investments: $173.55 (+$15.17)

Stash: $114.99 (+$9.40)

Acorns: $58.56 (+$5.77)

Earlier this year I decided to start learning more about investments. Since I find myself to be a hands-on learner, it seemed like utilizing micro-investing apps would be the best fit for the time being. I found two micro-investing apps in particular that provided built-in resources and tips for learning more about the investment world. This seemed very helpful especially for someone like me who has limited experience and knowledge on investing and its process.

As much as I was taught about personal finances growing up, I wasn’t taught much about investing beyond contributing to employer-sponsored retirement accounts. Additionally, I wasn’t able to take advantage of the economics classes due to other required class schedules. So due to my lack of experience and knowledge in investing, I wanted a low-risk but educational way to invest my money.

After some research, I found that there were many investment apps available. However, the Stash app and the Acorns app gained my attention the most. They both provided a simple and user-friendly process for investing and buying stocks and mutual funds. The two apps share many of the same features like setting up automatic contributions or enrolling in round-ups. However, they both have slightly different features that make it hard to choose just one of them. Why choose just one, though? Why not contribute to both? As you can see, I decided to contribute to both! So, slowly, I am learning what to do and what not to do while minimally increasing my portfolio.

Expenses

Total Expenses: Largest Spending Categories:

Debt: 18% (+5%)

Food: 17% (+7%)

Housing & Utilities: 16% (+0%)

In December, we saw an increase in expenditures for both our debt and food categories. These categories tend to always be our largest spending categories from month to month. This month, in particular, these expense categories dominate much of our discretionary spending. As my SO’s income decreased by half, I expected to see some expense categories spending percentages become inflated. What I mean is that we didn’t necessarily spend more on debt and food compared to the previous month but because we had less income this past month the calculations have showcased an increase in spending only. However, it wouldn’t hurt to continue to find ways to cut back on our food expenses.

Some of the little habits we do weekly is tracking our expenses manually. This process has humbled us and forces us to be self-reflective on how and where we are spending our money. We have expressed the desire to automate the process of keeping track of our spending to gain more energy and time. However, we wonder if by automating this process we will lose valuable insight on how to improve our spending habits. What is your favorite way to track your spending habits?

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Income

November 2019 Total Extra Income: $191.68

December 2019 Total Extra Income: $254.17 (+$62.49)

The month of December brought us additional miscellaneous income. This extra income really helped us lower our food expenses and keep us out of the fast-food lines. Before any grocery or shopping trip, I always review and clip any relevant coupons. I love using Dollar General’s Digital Coupons and Meijer’s mPerks coupled with Ibotta rebates!

Ibotta has also remained consistent in allowing us to earn extra income each month. We love that our family receives cash back on our everyday grocery shopping trips. Since we started using Ibotta well over a year ago we have earned more than $250. Have I piqued your interest in learning how you can maximize your Ibotta’s earning potential? If you decide to start taking advantage of cashback through Ibotta, we invite you to join our team here. By joining our team and redeeming one offer within the first month, you can earn $10.00!

Ibotta: $3.85

Mystery Shopping: $0.00

User testing: $0.00

Online Surveys: $0.32

Quora: $0.00

Misc: $250.00

Monthly Goals

Every year we set out to reach certain milestones. We have learned in the last year that when we set monthly goals that build into our long term goals we tend to see more true success.

Every month, we try to break down the 5 biggest areas that are priorities for us for the year into smaller and measurable goals. Many of our focus areas for the year 2019 were financial, personal development, health & fitness, family and career. Each month we intend to share our results of the goals that we set for additional accountability. Just below the results of our past month’s goals, you can expect to read a snippet of our successes and our setbacks during that month.

We continued to focus more on non-monetary goals in December with the Holidays. Overall, we were able to contribute more than the minimum payment towards our JCP credit and we were able to make more space in our home by decluttering. While we did not meet our goals of meal planning and prepping like intended, we have been attending a cooking class that has been really helpful in this area.

Additionally, we spent a lot of time with our immediate and extended family during the holidays which seemed to be just what we needed for the month.

We have really enjoyed using this process to commit and stay accountable to our monthly goals. This process helps us stay on track and helps to break our large goals down into smaller achievable ones. We look forward to continuing to do this each month. Check out our Instagram feed to learn more about our goal focus for the year 2020 and specifically for January!

Financial Progress Report Recap

December was another month we can close on a positive note. Despite all the changes and adjustments that we have been needing to make the last couple of months, we believe this was necessary to make us wiser with money. Now that my significant other is laid off, we will be adjusting our bill pay schedule to align with his unemployment. We believe this to have a great impact on our finances, However, we feel better prepared this year than any previous years.

Overall, our actions have been decreasing our credit card debt and improving our savings balances. We have noticed that we are gaining more control over our spending as our budget categories align with our goals. This month has provided us with the need for reflection and evaluation as we push forward with our next goals. Month to month we are continuously learning to new ways to adapt our finances to our life’s needs. Perhaps we are truly making progress in the right direction.

Previous Financial Progress Reports:

2019

2018

With every new month that goes by we are so thankful for the support that we have gained from the debt-free community. Additionally, we have improved our accountability by reporting on our financial progress. This has really allowed us to remain determined and confident in our abilities to keep meeting goals. As we move into not only a new month but a new year, we anticipate more positive change and progress towards financial freedom. This journey to financial freedom has helped us grow in more areas than just our finances. We have seen an improvement in our time management, our outlook on life, and the other little habits we make every day towards a better life.