Friday, June 3, 2016

Income & Expenses For May 2016

Since 2014, I have been tracking my monthly income and expenses. You can see a breakdown of every penny I earn and spend. For perspective, this budget is for a household of two in a small US city. By documenting my journey, I aim to demonstrate the feasibility of saving a significant portion of your income and provide some ideas and inspirations for your own budget.



Below is my income and expenses for May 2016. You can see all my monthly budgets here.


May 2016
Income
Wages$8,676.82
Dividends$384.50
Other Income$1,376.82
Total Income$10,438.14
Expense
Federal Tax$380.00
Federal Tax Pmt/(Refund)
FICA-SS$371.89
FICA-Medicare$86.97
Rent$450.00
Student loan repayment$159.53
Grocery$66.60
Cell phone$12.88
Electric$33.23
Clothing/laundry$6.00
Ebay fee$3.50
Other Expense$95.36
Total Expense$1,665.96
Ex-Tax Total Expense$827.10
Surplus/(Deficit)$8,772.18
Before Tax Saving Rate84.04%
After Tax Saving Rate91.38%

Income
Dividend income fell to new 12-month low of $384.50. Wages remain my primary source of income by far. Here is a chart of my dividend income by month for the past 13 months:

Total dividends for the trailing twelve months: $12,264.73, up 19% from $10,285.64 last May.

Expense
I had to spend $95.36 to buy a new laptop to replace my old one that got broken.
All other expenses are typical. 


Total expenses for the trailing twelve months: $9,568.73. 
Dividend to expense coverage ratio = 1.28. I am encouraged to see an uptrend in this ratio, which has consistently been above 1 year-to-date. This ratio was 0.91 last May, which meant my dividend income was not sufficient to cover my expenses, but it is now. If this ratio gets above 3, I would be comfortable retiring. If it gets above 5, retirement relying on dividend income would pretty much be bulletproof. I still have a long way to go.

Savings
My after tax saving rate was 91.38% for the month of May, which is again above 
90% after the dip last month due to one-time large tax payment. I expect to meet or exceed my 90% savings goal this year. 

How's your budget? Did you save as much as you wanted to? On track to meet your savings goals for the year? 
Thanks for reading.

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