Income & Expenses For December 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 inspiration for your own budget.

Below are my income and expenses for December 2017 and full year 2017, as well as those of 2016 for comparison. You can see all my monthly budgets here.

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	Dec 2017	Dec 2016	% Change	Cum 2017	Cum 2016	% Change
Income
Wages	$13,171.36	$10,061.76	30.91%	$135,806.32	$148,180.63	-8.35%
Dividends	$2,516.89	$2,051.67	22.68%	$16,086.72	$13,391.84	20.12%
Other Income	$341.96	$2,827.20	-87.90%	$1,614.01	$17,627.66	-90.84%
Total Income	$16,030.21	$14,940.63	7.29%	$153,507.05	$179,200.13	-14.34%
Expense
Federal Income Tax	$1,500.27	$1,019.16	47.21%	$11,938.15	$15,473.37	-22.85%
Federal Tax Pmt/(Refund)				$6,149.66	$3,609.15	70.39%
FICA-SS	$427.02	$418.22	2.10%	$5,124.24	$4,755.60	7.75%
FICA-Medicare	$99.87	$97.85	2.06%	$1,198.44	$1,112.20	7.75%
Housing	$500.00	$450.00	11.11%	$5,500.00	$5,400.00	1.85%
Student loan repayment	$35.70	$160.47	-77.75%	$891.78	$1,919.76	-53.55%
Food	$101.27	$108.35	-6.53%	$1,211.61	$852.37	42.15%
Gasoline				$130.68	$79.24	64.92%
Car Insurance				$285.68	$257.65	10.88%
Car Reg/Tax/Maint	$21.50	$20.00	7.50%	$486.14	$79.99	507.75%
Cell phone	$12.28	$12.87	-4.58%	$178.73	$189.59	-5.73%
Electric	$42.40	$27.92	51.86%	$466.45	$396.75	17.57%
Clothing/laundry	$7.50	$10.81	-30.62%	$96.62	$76.31	26.62%
Donation				$45.00	$13.00	246.15%
Amazon sale costs				$2.63	$9.01	-70.81%
Ebay fee				$10.90	$3.50	211.43%
Other Expense		$156.18	-100.00%	$369.12	$310.67	18.81%
Total Expense	$2,747.81	$2,481.83	10.72%	$34,085.83	$34,538.16	-1.31%
Ex-Tax Total Expense	$720.65	$946.60	-23.87%	$9,675.34	$9,587.84	0.91%
Surplus/(Deficit)	$13,282.40	$12,458.81	6.61%	$119,421.22	$144,661.97	-17.45%
Before Tax Saving Rate	82.86%	83.39%	-0.64%	77.80%	80.73%	-3.63%
After Tax Saving Rate	94.85%	92.94%	2.06%	92.51%	93.78%	-1.36%

Income
Wages remain my primary source of income by far. Wages this year has gone down 8.35% compared to 2016 due to timing of bonuses. Dividend income, on the other hand, has increased 20.12% this year compared 2016, and is now slightly over 10% of my total income.

Here is a chart of my dividend income by month for the past 13 months:

Total dividends for the trailing twelve months: $16,086.72, up 20.12% from a year ago.

Expense
Expenses were kept low this month, limited to essentials. $21.50 was paid for annual car registration fee (sneaky DMV tagged on $1.50 fee this time).

On a year-to-year basis, food expense rose 42% to $1,211.61 from $852.37, due to a combination of higher food costs, increased consumption, and timing of bulk purchases. Student loan repayment dropped significantly as I had consolidated my loans into a new 10-year loan at a fixed rate of 2.5% back in May this year, in anticipation of interest rate increase, as my old loans were of variable rate. Car expenses went up significantly due to increase usage and maintainence costs (brakes and tires). Electric costs went up 18% (higher cooling and heating costs). 

Total expenses for the trailing twelve months: $9,675.34, up 0.91% from a year ago.

Dividend to expense coverage ratio = 1.66, making a new all-time high!

The chart below shows my TTM dividend (red line) versus TTM expense (blue line) since I started tracking in 2014. One is financially independent when the the dividend (red) line exceeds the expense (blue) line, which happened around June 2015 for me. Ideally, the dividend line should stay well above the expense line and increase with time at a faster pace than the expense line. On this metric, I have been making significant progress, but would like to put some more distance between the two lines in order to afford me more freedom and room for error.


Savings
My after-tax saving rate was 94.85% for the month of December and 92.51% for the full year of 2017, exceeding my 90% saving rate target. Yay!



Thanks for reading!