Author: Mr and Mrs DDU.
We are big believers in living below our means; spending less than we earn. We try to only spend money on what is essential or makes us happy. Nearly everything society spends money on is fleeting: food, holidays, a movie ticket etc. Most of it is forgotten about by the next day and we look to the next thing to keep us entertained.
Every month we track our income and expenses to see how much we’ve saved/not spent. This helps us see how we’re going, as well as motivate us to continue saving. Hopefully over time, our savings rate will increase allowing us to invest even more.
We want to show that even on a modest income, it is possible to save hard, invest and become financially independent. We post any articles about our money savings choices or habits here.
July 2017 Savings Update
Regular Income: $6,188
Blog Income: $0
Total Income: $6,209
Savings Rate: $1,617
Savings Percentage: 26%
During July we invested a total of $1,103 of our savings into shares, which we will post about next.
Savings rate including Superannuation: 26%, this is the net amount after the superannuation contribution tax of 15%.
(We count superannuation savings when a payment is actually made, usually every 3 months).
Any month where we save more than 25% of our income should be considered as a win. July was the second most expensive month of 2017 and so it turned out to be the second lowest savings rate, more on that below. Let’s compare to last year:
July 2016 rate: -45.3%
July 2017 rate: 26%
This was a gigantic improvement for us. The increased earnings and continuing frugality saw us go from having to dip into our savings by $1,491 overall last July to actually saving $1,617 this July, an improvement of $3,108 in one year. Last month we said we wouldn’t see such a big increase, but this was another big month.
Dividend Income – A pretty small amount this month but it helps nonetheless and will keep growing as the years go by.
Regular Income – This is the after-tax figure if you’re wondering. It is the combined figure of both our incomes plus any bank interest we have received.
Blog Income – We count this payment when we receive a Google Adsense payment into the bank account. We didn’t receive anything this month.
Here we go, non-regular expenses that happened this month:
Car Insurance – We identify annual expenses when they actually occur during the year, not on a monthly basis. We paid $869.55 for our annual car insurance during July. We were happy with this amount for what it covered us for and with the provider we wanted to go with. Without that we’d have had a savings rate of 40%.
Stocking up – With the baby getting close we wanted to stock up on items that we have to get every so often. Buying cat food, litter and other household items in advance should hopefully mean we don’t have to make many shopping trips in the first several weeks of our baby being born.
We are pleased with how much our savings rates are improving compared to last year. With the way things are going we may be able to achieve a positive savings rate every month of the year, but no promises on that!
Thanks for reading this article about our financial journey Down Under.
Onwards and upwards!