Personal FUNance

“Financial fitness is not pipe dream or a state of mind it's a reality if you are willing to pursue it and embrace it.” ― Will Robinson

2016 year in review

Okay, the time has come to summarize our financial year in review. There’s some good, some bad, and lots to look forward to this year.

So for us, budgeting and spending has always been the big issue. There is no graph that will show that better than this one right here:

Income vs. Expenses

Looks pretty bad, huh? Any time the Expenses line remains consistently above the Salary line that implies one is massively overspending. Well on a month to month basis that’s true. But let me give some insight into how we look at and analyze our spending, as there’s more to the story.

Both my wife and I work in jobs that pay us every two weeks instead of twice a month. This means that we get paid 26 times a year and two months out of the year we each receive 3 paychecks in one month. My wife and I get paid on the same day so that means each month we get paid two extra times per month twice per year. When we look at our spending and create that graph, it is based only on two pay peroids per month and does not include either of our three pay months. It also does not include any bonus payments. In my job I get an annual bonus and had the final part of a retention bonus paid out. All of that was excluded as well.

We also exclude some expenses from our monthly spending – those we categorize as “Life Events”. So far that has involved spending associated with our wedding and the down payment on our home. Now we got married in 2015 so none of those expenses flowed through in 2016, but we did purchase our home in 2016, so our down payment was excluded. You may be asking what the logic of this is. I try to look at it like this – if we purchase a house again at some point in the future it won’t be coming out of month to month paychecks, it will be coming out of the proceeds of selling our current house or our personal savings.  The same goes with our wedding.  These are important expenses to consider when managing your personal finances, but they can dilute the picture when trying to assess how you are doing when trying to stay on a budget. We do account for these “Live Events”, we just do so when we start looking at our long term planning for FIRE.

So, when factoring in three pay months, bonus payouts, and “Life Event” expenses we actually broke about even, which to me is kind of where you want to be. We have all our savings automated so that’s taken care of before our paychecks are direct deposited into our bank accounts. If you take out the cost of purchasing a home, then we actually came out about $13,000 ahead on our spending. A couple of high/low lights:

  • Our food budget is astronomical and out of control. We averaged around $930 per month on food. We include groceries, fast food, Dream Dinners (a service that we purchase meals from monthly similar to Blue Apron), and pizza as our food budget. That’s a lot for two people. We even split out restaurant costs into our entertainment budget because we when we go out to eat it’s usually because its Saturday night and we want the experience of eating out at a restaurant.
  • We paid off around $31,000 in debt last year, not including any principle on our mortgage. We paid off our credit card (which started with about $17,000 in debt), and the rest was put towards our cars and my student loan. Getting the credit card paid off was a huge relief for us. One of primary personal finance goals was to get out of credit card and stay out.
    • Side note: Between 2015 (when we started to do any tracking of finances) and last year we have paid off over $64,000 in debt (excluding mortgage). We still have about $96,000 left between my student loan and what remains on my wife’s car, but we’ve made good progress
  • Other costs, which can seem like a lot during a given month, tend to even out over the year. There are days where my wife will come home with a shopping bag from Target and it hurts because we spent a couple hundred dollars on what are usually things we need (cat litter, cleaning supplies, etc). Those shopping trips hurt when they are cluttered around each other, but over the course of the year we only averaged $140 per month on these trips. Gifts is another example. With birthdays and weddings it can seem like gifts are a huge drain on our budget some months, but really we average about $60 per month on spending. With a large group of friends and a moderately sized family this really isn’t so bad.
    • Side note: We do tend to spend too much on amazon compared to other stores. It’s only $50 per month but it adds up and I often wonder what we purchase. I am probably most guilty of this. It’s just easy with the one click purchasing they have!
  • Our average cost for our home was around $653, but this isn’t as bad as it seems. As I’ve alluded to, we bought a home in late April last year and moved in May. We paid for movers (I don’t care what anyone says, paying for movers is money well spent), bought a new TV, picked up some new furniture for the house and some supplies we didn’t have in our condo. So we expect this to go down even with some of the additional maintenance of owning a home.
  • We allocate $500 per month for personal spending. Each of us gets $250 and we can use that on whatever we want. With daycare moving in, we are going to need to re-evalute this.

So from a spending standpoint it’s pretty clear what caused us to (kind of) go over budget. Debt payments, food, moving, and some lifestyle choices that are going to change out of necessity because we had a baby (less going out to eat, more meals at home, etc).

From the investing side? Our investments are almost all automatic through our 401k’s. I do some investing in an HSA a couple times a year, but that’s about it. But here’s the year over year view:

  • On December 31, 2015 the total value of our retirement accounts (401k’s, Roth IRA’s, and HSA’s) totaled $126,218.45
  • On December 31, 2016 the total value of those same retirement accounts was $172,517.61
    • That’s a total gain of $46,299.16 year over year
    • Total contributions for the year was $31,305.84
    • That means that investment gains totaled $14,994.16
    • Breaking out contributions vs. market returns shows that my market return was approxiately 11.9% last year
      • Vanguard’s 500 index returned 9.54% last year which means you could argue I beat the market
      • I want to emphasize beating the market is not my goal, and I hold some asset classes (small cap value, emerging markets, and international small cap) that I know are a bit riskier than just the Total Stock Market Index or the S&P. I am guessing that those are the reasons for the higher return. Either way, I am more than content with that return.


So overall I consider this to be a fairly successful year. We still have a ways to go on spending, specifically food, but we paid off a ton of debt. We had a good return on our portfolio and were able to grow our retirement accounts substantially. We have some new challenges going into 2017. But overall, life is good. One step closer to FIRE.

Debt reduction success!

My  company pays out its annual bonuses during the first pay period in March each year. This year the month of March is also a “3 pay month”. Since we get paid every two weeks instead of bi-monthly that means twice a year we get 3 paychecks a month. Personally, I like bi-monthly paychecks more as I value the consistency of a steady stream of income versus the extra cash twice a year. What I would like to do is get to a place where we live off for two paychecks a month and save the extra money from our three pay months or use it for a travel. But we aren’t quite there yet.

Either way, the point is that the month of March is giving us an influx of cash that we don’t normally have. While I would like to take that money and toss it in a Roth IRA or use a chunk of it to save for travel, we really need to clear out some of our debts. We owe on taxes this year, have two car loans, and have my student loan. So what we have decided to do is pay off one of our cars (about $4000 worth), pay our taxes  (about $1750) and pay off a chunk of our other car (about $6000). All in all this lowers our actual debt by about $10,000. But more importantly (for us) it frees up cash flow. The car we paid off was costing us about $310 per month so that’s now money we have available monthly. With our house, student loan, and daycare we were in need of some cash flow relief as our fixed costs are really high right now. 

I am waiting until the end of the month to see what our savings looks like before making a decision to fully pay off car 2. Right now there is about $2000 left on the loan. We could afford it, but I just want to see where our emergency fund is at the end of the month before dipping into it to fully pay off the car. We are having some other issues with major appliances that may need to be replaced soon (AC, hot water heater, and possibly dish washer) so I don’t want to be cash strapped if we suddenly need to replace one of those.

So it’s been an expensive month, but a good one. We’ve increased our monthly cash flow by $310 and eliminated $10,000 in debt and we may fully pay off our second car by month end. I’ll take it! Most importantly, it’s one step closer to being debt free!

Budgets, Newborns, and Future Plans

It’s been a while since I last posted on this blog. I had a feeling when I started it that it would be hard to keep content going since my wife was expecting a baby shortly after I had started the blog. I do apologize for that as it has been close to three motnhs since I last posted anything. I wanted to take this post as an opportunity to really circle back on what’s been going on and what my plans are going forward for this blog.

So let’s start off with what’s been going on. My wife and I had a baby back in November. November 28th, 2016 to be exact. Since Avery was born there have been many ups and downs. The first month was not a very pleasant month to be quite honest and blunt. Thankfully I was able to take a ton of time off work and help out at home. I only worked 8 days between Thanksgiving and January 3rd. That made a world of difference. Our daughter was a crier, especially during that first month and she did not sleep more than a couple of hours at a time (if that). And when she did sleep, she almost always had to be held. We couldn’t put her down. When we weren’t fighting to keep her asleep we were constantly having to console her as anything more than 10 or 15 minutes of her being left alone was too much for her to handle. So keeping this blog going and focusing on personal finance wasn’t a huge priority for me. I also want to add that I am not in any way complaining about my daughter and parenting. I am just saying that for us it was a very trying and challenging experience that shifted our priorities and focus even more than we thought it would. We knew that having a child would require a shifting of priorities and certain things would be put on hold, but the sheer volume of time we had to spend consoling our daughter was unexpected. There were some really awesome moments in all of it, but it was very trying too. Thankfully she has gotten better at sleeping and worked through her crying phase. It has made all the difference in the world at home!

So aside from adjusting to life with a newborn, I have been trying to keep things from my pre-baby life in place. This may sound weird to some people, but one of the things that was important to me going into parenthood was making sure that I was still me. As silly as it sounds I wanted to make sure I still made time to watch pro wrestling, play video games, exercise, and work on this blog. I have not been able to do those things as consistently as I’d like, or on my own terms like I used to be able to do, but I still have been able to find time with some flexibility. I now wake up at 5:30 in the morning to exercise instead of doing it after work in the evening. I play a lot more mobile games. Feeding the baby and holding her while she sleeps is a great time to watch pro wrestling. All in all, things are going pretty well at this point with parenthood. We are starting to reach the new normal and adjust accordingly.

What about our finances? I haven’t been able to spend a ton of time managing our finances since Avery was born, but I do think I have found a solution. The first part of that solution boils down to better time management. Avery is just over three months old now and sleeping better, which helps immensely. The other thing from a time management perspective that is making a difference is how I am managing our finances. Pre-baby I was downloading every transaction from our credit card and bank account, aggregating everything together, and categorizing things manually. Then I had an Access database linked to an excel spreadsheet that I was using to analyze and look for trends and details on where we were spending our money. It was fun, I enjoyed it, and it was a good way for me to stay on top of things. It just isn’t feasible with a new baby. I just can’t dedicate that much time to managing our finances. That isn’t to say I don’t want to. It’s just that pre-baby I could deal with the inefficiencies that I knew existed in our system. Now I don’t have the time to deal with them.

As I was coming to terms with the fact that my spreadsheets were going to have to be retired, I did a lot of research on what was available to help manage ones finances on a day to day basis. I was familiar with Mint, YNAB, and Quicken, but I did not realize how many other tools were out there to help you manage your finances and budget. I can’t even begin to tell you how many programs I looked at, but here is a list off the top of my head: The aforementioned Mint, Quicken, and YNAB. In addition to those three I discovered CountAbout, PowerWallet, GoodBudget, Home Budget, MVelopes, LearnVest, Personal Capital, Moneydance, and I’m sure a few others I am forgetting. Ultimately I decided that for the Funances, Quicken was the way to go. It gave me the customization I need and the ability to link all my accounts so that things download automatically to the system. It also spits out the analysis that I need to help me see where we are spending our money and auto-categorizes a majority of our transactions. It just works. We are supplementing our process of managing our money with Mint and Personal Capital. Mint for tracking the day to day spending just to make sure we don’t go over budget during the month, and Personal Capital just gives me the views into my investment portfolio that help me better understand my asset allocation and returns.

So what does this all mean for this blog? Well, first and foremost it means it will be easier for me to bring materials to this blog. One of the things I want to do is share our story as we work towards the path to financial independence. For us that is spending and our monthly budgeting. Doing that analysis in excel made it difficult for me to aggregate the data to share with this blog. With Quicken, Mint, and Personal Capital it will be much easier for me to present data to review and comment on. My whole process of updating and revewing our spending on a monthly basis is now probably an hour or two (tops) versus three to four prior. My goal is to use the time savings and easier aggregation of data to share more of our story.

Secondly, after spending so much time reviewing all these app’s and software programs that help you budget I feel like I should give feedback on them. I will probably spend some time writing my own personal reviews on some of these app’s. Some of them I did not spend a ton of time with so the reviews will be more high level, but with so many options out there I want to lay out the pro’s and con’s of each. What I liked about each one, and why I ultimately went in another direction if I didn’t use it. Full disclosure ahead of time: None of these companies is paying me a dime to comment on their product. I want to do this simply because I had the experience of reviewing them for my own personal use and want to bring that knowledge to anyone who finds this blog.

There are two other things I want to do with this blog. First, I want to produce content that has depth and meaning. I don’t want to just shove an article out that talks about why you should invest your money in a 401k instead of a Roth IRA (or vice versa). If I write that article (which I probably will one day) I ant to explain why, and provide the math behind it. Posts like that are going to have gaps between them right now simply because of the juggling act of working a full time job, raising a newborn, investing in my marriage, and other commitments I have take up a lot of time. And it will take time to produce quality content, and I want those types of posts to mean something.

The second thing I intend to do is really track our journey towards financial independence and talk about the ongoing successes and struggles that we experience on the road there. A couple things that this entails in my mind will be:

  • Overview of our monthly budget and spending with the intention of looking at wins/losses and struggles/successes on a monthly basis
  • Short term I want to spend time (as mentioned above) talking about some of the tools we are using to manage our journey to FIRE
  • Some commentary and general reflections on some of the things my family and I are dealing with that impact our road to FIRE. This is a broad topic and is meant to be and in my mind it ranges from talking about time management issues, to challenges we are facing at work.

More specifically, over the next few weeks and months here is what I am envisioning:

  • 2016 year with the Funances in review – an oveview of our budgeting, investment accounts, and net worth from January 2016 through December 31, 2016
  • What our budget looks like this year
  • Details on how I am using Mint, Quicken, and Personal Capital to manage our finances
  • A general overview of our spending plan and follow ups on how we are doing

This may all seem somewhat odd and scatterbrained, and to some extent I would agree that it is, but I wanted to take some time and and really scope out what my goals are with this blog, where things are at with me since I haven’t posted in a while, and give a sense of where things are at with the Funances, financially (pun intended there). Having a baby has forced me to really look at my goals and become more targeted and efficient. For me, that has meant a shift in focus on how I manage our investing, budgeting, and spending on a day to day basis. And as I have said, I want this blog to reflect that journey we are on to FIRE. So that’s where things are today. More to come in the coming weeks and I can guarantee the first thing I’ll be posted on is our 2016 year in review.

How a baby has impacted our finances in the first four weeks

So Mrs. Funance and I are about four weeks into parenthood. It’s been an up and down ride which I think most people would say after having their first child. Here are some reflections on the experience so far and how it relates to personal finance, FIRE, and money.

So far we are spending less money than pre-baby

This is perhaps the biggest surprise so far, but at the same time, maybe shouldn’t be. No longer are we planning to go out on Saturday night or even picking up take out to eat at home. We preparing a huge amount of food before our daughter was born and froze it so have been eating that. Plus, the holidays have been ongoing which has meant there is always someone in the family we are connecting with and having a meal with. This combined with the fact that we are just home all the time now has really cut down our spending.

This trend in lower spending won’t last

We will enjoy it while we can. Because once daycare kicks in when my wife goes back to work we will be looking at an extra $1100 a month out the door (roughly).

Christmas was cheap this year

We tend to overspend on Christmas gifts most years. Both on each other and our friends and families. Not this year. We have been focusing on adjusting to our new life as parents and, quite frankly, Christmas shopping got away from us this year. We really limited our spending to parents and close relatives in the form of giftcards. Using giftcards as our primary gift this year really limited our ability to overspend because we aren’t picking up that little trinket that costs only $15 and using it as a stocking stuffer.

Food costs are way down

I’ve alluded in prior blogs that our food costs have been our biggest source of consistent overspending. Whether it’s fast food, eating out, poor planning with our grocery store purchases. We consistently go overboard on our food expenses. So far we haven’t really done that post-baby. The biggest reason is that we prepared a ton of food ahead of time as I had mentioned above. But we also aren’t leaving the house a lot which is limiting the opportunities to buy fast food and quick convenience purchases. The one time we did go to Wendy’s it truly was a treat for us and we made it an experience, not too different from how we would have previously treated a night out at a fancy restaurant. I’m hoping this trend will continue into how we view food purchases in the future.

FIRE and most FIRE related items in my life are on hold

Or at the very least they are moving along at a slower pace than before. I just now am starting to update our spending report for November. Normally I do that the first weekend of the month. I haven’t thought about this blog in a few weeks between work and caring for our daughter. I haven’t checked our net worth lately. I definitely still care about these things. I just haven’t been able to prioritize them the way I’d like between our daughter (who has not been a good sleeper and been very fussy) and helping my wife adjust after a c-section. Slowly but surely these things are getting back on track.

I am more interested in my health than before

I think most people want to be healthly. Why wouldn’t you? I have long wanted to drop some weight but haven’t really taken the steps necessary to make that happen. I find my approach to making that happen a little bit different right now than I did previously. I don’t have the time to exercise like I had in the past so I am focusing much more now on eating better and calorie count. This is not easy around the holidays, but truthfully this is probably the way to go about doing it anyways for long-term results. To me, this is an indirect way to impact financial independence. One of our biggest long-term costs can be healthcare. And if I am a healthier person, with a healthier lifestyle, then that means I can hopefully lower one of my costs in early retirement. Plus, since I’m not able to devote as much time to side hustling or blogging, focusing on my health is a way that I am able to stay connected to my financial goals, even if it is indirect. And having that emotional connection to the bigger picture through day to day actions helps me stay engaged.

I am still the same person I was before

This isn’t necessarily related to finances or FIRE, but I think it’s an important thing that I want to comment on. Leading up to becoming a parent I read and heard all about how having a child changes your life and changes what matters to you. And I won’t deny having daughter has changed my life, but I still feel like the same person I did before she was born. I care about the same things. I still want to find time to watch wrestling and play video games. I still want to retire early. I still think my marriage is the most important relationship in my life (and my wife agrees). We both love our daughter and there moments of pure joy in raising her. But there is still joy in finding an hour to play Xbox or watch an episode of Monday Night Raw.

I guess the only reason I bring this up because I think having a clear idea of who you are is important no matter what stage of life you’re in. If you’re fighting for Financial Independence do it because you are running to something rather than away. I’m not necessarily running to a life of playing video games and wrestling, but those things and other priorities still remain to me. We just now have another person to share it with.

Merry Christmas and a Happy New Year to all.

I am thinking the next blog post will be a stereotypical “What are your financial resolutions in the new year?”. Stereotypical? Yes. But helpful, because it forces me to think about how I want to change and grow in the new year.


Babies and FIRE

A couple quick thoughts this morning.

My wife gave birth to our daughter last Monday and we made it home on Thursday after a draining week at the hospital. That combined with the Thanksgiving holiday the week before have made for an incredibly busy couple of weeks in the Financials household. As for me and this blog a couple thoughts and/or comments:

  • Tending to my daughter and wife are my top priority right now. There is only so much I can do to help care for them but I need to keep them as my top priority
  • My health is my number 2 priority. I have had struggles with weight gain the past several years and need to drop some weight as the weight gain has led to borderline high blood pressure and could be a factor in my sleep apnea. Having a baby makes this a higher priority
  • I am still going to be working on this blog, just not as frequently as I had hoped for. We will see how things pan out caring for my daughter but caring for her will eat up much of the time I had planned to spend on the blog
  • An overview of how the Funances spend their money is coming soon. This has been the biggest slowdown for more content for the blog. I have been reworking how we track out spending and analyze it monthly for a while now. I just got stuck along thwart and haven’t been able to finish it. But I am close and will share as soon as it’s ready.

Above all enjoy the holiday season. Don’t get too sacked into the marketing of the season! Instead buy someone an index funds and help them invest! Side note on that-one of the things I am most excited about doing is starting an investment account for my daughter in hopes that when she enters the real world I can give her a huge head start on investing and early retirement.

Enjoy the season and Merry Christmas!

Plugging away at the budget

Just a couple of quick random thoughts for today. Mrs. Funance and myself are waiting for the birth of our daughter. She is due in a week, but as many of us with children know that babies can come any time they are ready. We have been spending a lot of time preparing for her to come, and one of the things that we did ahead of time was prepare a lot of food that we could warm up in the oven so we wouldn’t have to go shopping or rely on fast food or pizza in the weeks after she is born. One of the things that my wife said to me when we were buying all the food to cook was “But, won’t this take us over our food budget for the month?” Of course, being a money nerd I smiled on the inside that she was thinking about our budget.

Yesterday I pulled together our spending results from October to see how we did. Even though I used the word budget in the title of this blog post I do try to avoid using that word too much when reviewing our finances. I try to think of it more as a spending plan where we have targets for various categories and assess how we do each month. Our biggest pitfall has been our food budget. So last month we did go over our food budget, but I feel better knowing that we did so in preparation for the baby.

Part of my goal over the last few months has been to dive deeper into our budget to gain a better understanding of our finances so that we know where we can (and will) need to cut back when the time comes to pay for daycare. So that’s the next step. I’ve rebuilt our budget from the ground up probably 3 times in the last year after learning more about spending and budgeting from the personal finance blogging community, and I think I’ve finally reached the place we need to be to understand the data to make some informed decisions about our finances. So I’ll take that as a win, with the next step being a deeper dive into the numbers.

Money matters, but it isn’t everything

Over the past month or so I have gotten caught up in the Major League Baseball playoffs. That’s something I haven’t been caught up in for years. As I’ve gotten older I have had to find ways to better manage my time and enjoy the hobbies that I do have. Work, family life, and just general adult responsibility take up a lot more time than they did in high school, college, and my early 20’s. And that isnt a bad thing. These things add so much fulfillment to my life. But as a result certain things I have enjoyed immensely at various points in my life have gotten less attention over the years. I don’t read as much as I’d like too. I am perpetually adding shows to my netflix backlog and saying “I will get to that some day”. My video game backlog is literally hundreds of games long. With gaming I’ve reached the point where I probably won’t buy another system for myself unless it’s to play games online with friends. There are martial arts classes I want to take. Trails I want to hike. Volunteer work I want to do at the local animal shelter. But most (if not all) of these things are “nice to haves” in my life.

One of the things I have learned to do fairly well in my adult life is to accept my limits. What I mean by that is that I have done a pretty good job of living in a way that gets me through the day to day grind of work and then filling me free time with activities that help me recharge my batteries. Being an introvert, I am typically pretty burned out by the end of the week and to effectively recharge I need time by myself, usually at home, to prepare mentally and emotionally for the week ahead. That means I am often not engaging in the types of activities that are on my bucket list because I am focusing on taking care of myself. As part of my own efforts to grow personally that is an area I need to continue to work on, as I don’t want to go through life just waiting until that one moment that comes when I am financially free and can then start working on that long list of things I want to experience.

So getting back to baseball…..I guess for me that means that sometimes it’s better to get outside your comfort zone, or make a concentrated effort to enjoy something you’ve put on the back burner while dealing with the day to day of adulthood. Financial freedom will come one day, and money certainly matters when planning for it. But we don’t want to get so bogged down in the hustle, that drive for money, doing those things that are taking us towards that ultimate goal of financial freedom while not enjoying the ride along the way. There’s a lot of life to live on the road to financial freedom, not just when we get there. Don’t forget to roll down your windows and enjoy the ride while taking a few detours while driving. Otherwise you may end up at your final destination, look back, and realize that you missed out on some of the best parts of the trip along the road behind you.

It’s all about your expenses

When I first started taking control of my personal finances and planning for early retirement I thought investing was the number one thing that I needed to figure out in order to retire early. I would read personal finance articles on yahoo, or othe news sites and they would constantly post articles that had some variation of a title that read “How to save 1 million dollars by the time you retire”. I thought that was the only thing that matter when it came to retirement savings.

While I have always largely believed in passive investing through index funds, I would be lying if I didn’t admit that part of my plan to retire turned into finding that one fund, asset class, or investment that was about to outperform the market. Then I would put a portion of my portfolio into it and reap the rewards of being smarter than the market. I thought that even if I only used a small portion of my portfolio (5% or less), I would do so well with these investments that I kept finding, that it would propel me into early retirement and financial indepdendence. So I started developing these forecasts of my portfolio that included finding that one lucrative investment, and was focused on how that one investment would impact the value of all my accounts at different potential retirement ages. I was more interested in seeing a retirement forecast showed that I had $1.5 or 2 million dollars in it than anything else. I figured with that kind of money I would be able to retire no matter what.

Then about 18 months ago I had a wake up call. I had been reading the early retirement forums for a couple of years and every time someone would introduce themselves and list their assets and ask if they had enough to retire. Every single time this happened there was one question that would be asked in response: “What are your expenses?” And funny enough, despite hearing that time and time again, it took me a couple of years to actually “hear it” and look in the mirror and realize that I had some housekeeping to do in my own financial life. It wouldn’t matter how much money I had in my retirement accounts if I wasn’t managing my spending.  I could have $10 million dollars in assets, but if my annual spending is $1 million dollars year per than it’s highly unlikely I was going to have enough to sustain a 20-25 year retirement. In fact, I probably  would only have enough for 10 years of retirement. While this is an over simplification, it paints the picture of a key factor in the retirement equation.

This was an intriguing for me. I started to wonder if it would be a good idea to start tracking my expenses, if for no other reason to give myself comfort and reassurance that what I thought I had been spending (in my head) matched reality. I had always assumed I had a pretty good handle on what I was spending, or perhaps I should say I assumed I had a good handle on what I thought I should be spending. I knew how much money I was bringing home and what I was paying monthly for rent, student loans, and utilities. That gave me a general idea of how much I had left over to allocate for food, entertainment, gas and things like that. And I had a pretty good idea of what those things should be costing me. I knew I overspent a little bit on food, but probably $20 or $30 a month. Certainly not more than that.

What I found shocked me. As a single person, I was spending between $500 and $600 a month at the grocery store. Probably another $50 on fast food. I was dating my wife at the time and we had just moved in together so I also looked at what we were spending. The results terrified me. We were spending between $1200 and $1400 a month on groceries and eating out. I also realized that the overspending was more my fault than my wife’s. I was the one spending more money at the grocery store, and in many cases wasting food.

This also changed my outlook on retirement planning. I stopped worrying so much about finding that one investment that I was going to make with a small percentage of my portfolio that was going to beat the market. Part of the reason that had been so interesting to me was that it was fun and it made me feel like I could control how quickly I could accumulate enough money to reach financial independence. While I really do enjoy trying to find that needle in a haystack stock, mutual fund, or ETF that will outperform the market, I knew it had a low probability of success, and that the stock market is completely out of my control. Ultimately, it was a lie I was telling myself to help me feel like I could do more than I really could to reach financial freedom. On the other hand, managing my day to day, week to week, month to month spending was something I had complete control over. And if I could continue to get my spending under control, that could impact my savings rate, the only other factor that would influence the size of my investment portfolio that was within my control. Increasing savings rate through reduced spending also had the trickle down effect of reducing the amount of money I would need to reach financial freedom because lower spending means lower withdrawals from my portfolio.

There was something very liberating about this realization for me. No longer was (or is) it about investments. I know what I want my asset allocation to be. I know that I am going to rely on passive index funds. I know that I may take a small part of my portfolio to invest in stocks for fun. What the returns on those investments are is out of my control. Instead I can focus my energy on something I can control that will ultimately probably have a bigger impact on my ability to reach financial freedom: my spending. And that helps the days to financial freedom go faster because I know that when I am making decisions its actually making an immediate impact on my plan for financial independence. Even the small ones like whether or not to buy that latte. If I am thinking that through and making a decision not to buy that latte because it isn’t something that really adds value to my life then I am moving closer to financial independence. Not so much because I saved $4 on the latte, but because I have changed my behavior and made a decision that better aligned with my value system. And at the end of the day that’s what financial freedom is largely about – building a lifestyle to better align with what we care about what we value. So step back, enjoy those investments and savings. But also take a hard look at your spending. Because in the long run, there’s a good chance your spending is going to have more of an impact on your ability to reach financial freedom than your investments, and its something you can integrate into you daily living that gets you a little bit closer to that ultimate goal of financial freedom.

Who are the Funances?

I’ve written a couple things now about what inspired me to start this blog and pursue early retirement/financial independence, but I thought this may be a good opportunity to get a little more personal and provide some more insight into who Mr. and Mrs. Funance are, what makes us tick and what we enjoy doing.

So I guess I’ll start with the standard “what we do for a living”. Don’t you think it’s odd that when we first meet a person one of the first things we almost always ask that person, or share with them is what we do for a living? That strikes me as odd because how many of us truly define who we are by our jobs? I know that personally my work is only really a small piece of who I am. Even when I am in the groove at work and having a lot of success, there are other things in my personal life that mean so much more to me.

Anyways, that was a bit of a tanget. what do we do for a living? Well, I (Mr. Funance) work for a  financial services organization as a Risk Manager. I’ve spent the last 10 years of my career in risk in different arena’s in the financial services industry. I’ve had some ups and downs on this career path, but generally speaking the results have mostly been positive. One of the most surprising things to me about working in the financial services industry while being involved in personal finance is how different then two areas are. Most people assume that I am good with money because I work in the financial industry. And my experience has been that working in financial services does not make one good with money. In fact, I would argue there is no correlation at all! The skills and information you need to successfully manage your finances are not in any way correlated to what is needed to be successful working for an insurance company, bank, or even a hedge fund or investment firm. What about Mrs. Funance? Mrs. Funance works in healthcare as a nurse and has aspirations to become a Nurse Practitioner. Meeting Mrs. Funance has helped fuel my desire to FIRE, in part because of what she does for a living. Each day she goes to work saving lives and gets to see the results of her work. I have always had a hard time connecting my work to tangible results like that. That isn’t to say there aren’t tangible results, I am fortunate enough to say that my work does matter and I have seen proof of that over my career. It’s just not always easy to see.

So who do we share our life with? Our pets!


Not the clearest picture, but I think it tells the story of our pets! We have a cat (Stan) and a dog (Stella) who have brought so much joy to our life. Stella likes to think that Stan is her best friend in the whole world, but the cat isnt’ having it! Watching these two fight each other is something else! While they may fight with each other these two are so loving and kind to my wife and I. Nothing makes Stella’s day more than being able to curl up next to us on the couch while we watch some Netflix. And Stan has his nightly routine of hopping into bed with us to snuggle up between us before we fall asleep. There’s something about kind, loving animals that just warms your heart.

Video games. Yes, video games. I am a huge video game fan! Yes, even in my 30’s I still enjoy sitting down with Nintendo, Playstation, and Xbox to grind a way at Halo, Mario, and Final Fantasy. Games aren’t for kids like many people think they are (well I mean they are, but they are also for adults too!). So much immersion and such an inteactive way to escape and unwind for a couple hours. There are things that games can do that TV and movies can’t, and that’s why I love games. Another favorite of mine? Pro wrestling! Yes, now you are probably starting to wonder if I am a 30 something striving for financial independence or a teenager who isn’t quite sure if “wrasslin” is real! I assure you, I’m the former! But much like video games, wrestling is just another form of escapism. It’s a soap opera for men, a real life comic book in many ways. The entertainment value is off the charts. It’s still real to me!

In a similar vein, Mrs. Funance loves Harry Potter! Fun fact: before meeting her I had never read the Harry Potter books and only seen the first Harry Potter movie. Needless to say that has changed since we started dating. Every time ABC Family/Freeform has a Harry Potter weekend, that is what our TV is locked on. She is also a huge fan of The Walking Dead (I am too, but I think Mrs. Funance takes the cake on this one for me). We are dying (pun intended) to see the season 7 premire tomorrow to see who Negan whacked at the end of season 6 (my money’s on Abraham and/or Glenn). Mrs. Funance also took up running before she got pregnant with our daughter and has ran two half marathons! Words can’t describe how proud of her I am. She ran the second one while 3 months pregnant too! That is something I don’t think I could ever do.

We are also huge sports fans. Baseball, basketball, and football. Although we tend to be a little more focused on the college game than then NFL. Being a sports fan can be frustrating as it makes it a bit tougher to cut the cord on that cable bill, but we’ve found a few ways to make it cheaper!

Perhaps our biggest “guilty pleasure” if you will is how much we love going out to eat. That doesn’t always sit well in the financial independence/frugality world, but it’s one of the things we love to do. To us, it’s an experience to get dressed up, get out of the house and check out a new restaurant, take in the ambience, and try the food. While we’ve definitely cut back from when we first started dating, we still love to do it when we can. And with baby on the way, we are trying to take in a few more restaurants before we are bound to the house for a while! We enjoy cooking too, but haven’t quite come to master the food quality of what we can get out of the house. Maybe with the new baby we will be able to get there since we’ll be cooking more!

So that’s a little bit about who we are, what makes us tick, and how we spend our time as we work towards financial independence. And hopefully, when we do retire, we’ll have a lot more time to dedicate to these hobbies, and even develop some new ones 🙂


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