Friday, February 3, 2017

Income & Expenses For January 2017

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 are my income and expenses for January 2017. You can see all my monthly budgets here.
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Jan 2017
Income
Wages$10,296.36
Dividends$945.15
Other Income$249.63
Total Income$11,491.14
Expense
Federal Income Tax$735.83
Federal Tax Pmt/(Refund)$5,500.00
FICA-SS$427.02
FICA-Medicare$99.87
Housing$450.00
Student loan repayment$160.47
Food$103.43
Gasoline$26.64
Car Reg/Tax/Maint$281.54
Cell phone$12.87
Electric$38.82
Clothing/laundry$10.00
Other Expense$102.85
Total Expense$7,949.34
Ex-Tax Total Expense$1,186.62
Surplus/(Deficit)$3,541.80
Before Tax Saving Rate30.82%
After Tax Saving Rate74.90%

Income
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: $12,786.23, up 6% from $12,041.15 last year. 

Expense
Expenses are significantly higher this month. I had to spend $281.54 to replace brake pads and rotors that had worn out. A quick check online reveals this was actually a bargain for the work that was done, so I am grateful it did not cost me twice or even thrice as much. I also prepaid $5500 to IRS for federal income taxes + $102.85 (1.87% pay 1040 service fee) to redeem my credit card rewards. Typically I file my taxes in late March/ early April when all my tax documents become available. I estimated I owe around $6000 +/- 400. Paying $5500 now leaves me around $500 +/- 400 balance to pay when I file my 1040 later. The other expenses are fairly typical.

Total expenses for the trailing twelve months: $8,811.78.
Dividend to expense coverage ratio = 1.45, reaching an all-time high. I like how the gap between my dividend income above and expenses below is widening, as depicted by the graph below.

Savings
My after tax saving rate was 74.90% for the month of January 2017. This is the lowest savings rate since I started tracking in January 2014. My savings were significantly reduced by the $5500 federal income tax payment, which is a non-recurring expense. I am optimistic that my saving rate will get back up above 90% for the remainder of the year.
Thanks for reading. 

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