PoP Income Statement October 2012

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Kitty PoP has recently discovered that lizards hide from him in some of the potted plants… he’s working on fixing that problem.

Again, I must shamefully report that we overspent on food and gas this month. But Mr. PoP and I just talked about it, and there’s a new resolve to do better in November. Please hold us to it, PoP readers!

I also had a bit of a time deciding whether or not to categorize NPR contributions into Media Non-Subscription or Charity. I went with charity since technically it’s tax deductible if we itemize, but we have yet to ever itemize… But on the other hand, I tend to think of our contribution to NPR as paying for content we enjoy – the same way we pay for content from other media providers.

Either way it’s still money out the door, so let’s get down to what really matters – the numbers.

The Bottom Line

  • Earnings before principal paydowns and savings allocations of $5,318.

And here are the details…

Income

  • Wages and Salaries (after taxes, 401K deposits, HSA allocations, etc.): $7,438
  • Rental Income: $1,500
  • Miscellaneous Income (rebates, med reimbursements, etc.): $1064 ($765 of this is in credit card rewards for Holiday spending)
  • Total Income: $10,002

Expenditures

  • Groceries: $482
  • Eating Out: $484
  • Total Food: $966 – Ouch! Visitors and a work trip for Mr. PoP pumped this up, so some of this is reimbursable… still, pretty high though =/
  • Mortgage: $1,166
  • Home Maintenance and Repairs: $264
  • Total Home: $1,430
  • Gas: $593 – Like the food, part of the gas spending is from Mr. PoP driving for a work trip, but we’re going to work on this category, too!
  • Auto Repairs / Maintenance: $92
  • Total Transportation: $686
  • Bills/Utilities for Primary Residence: $383 – yay for using the AC less with cooler nights
  • Bills/Utilities for Investment Properties: $83
  • Total Bills / Utilities: $466
  • Interest Payments on Non-Mortgage Debt: $115
  • Car Loan Payments: $265
  • Total Interest / Car Loan Payments: $380
  • General Shopping: $382 – I’m tracking Holiday shopping separately, but we still record it as general shopping
  • Pet Supplies / Care: $0
  • Total Shopping: $382
  • Gym / Fitness: $73
  • Media Subscriptions: $25
  • Media Non-Subscription: $3
  • Total Fitness/Entertainment: $101
  • Travel: $123
  • Charity: $150 – I hesitate to put NPR contributions in charity, but I would also feel comfortable with this in Media Non-Subscription
  • Total Miscellaneous: $273
  • Total “Everyday Expenditures”: $4,684
Earnings Before Principal Paydowns / Savings Allocations (EBPPS)
  • EBPPS = $10,002 – $4,684 = $5,318

Principal Paydowns / Savings Allocations

  • Principal on HELOC: $3,500
  • Savings for Estimated Income Tax Liability*: $500
  • Transfer to IRA Holding Account: $1,000
  • Total Principal Paydowns / Savings Allocations: $5,500

Net Income = EBPPS – (Principal Paydowns + Savings Allocations)

  • $5,318 – $5,000 = $318 = Net Income

So all told, our cash accounts grew by $1,818 this month. ($1,500 to savings accounts, and $318 from net income.)

*We’ll be keeping back some extra for the next few months as I’m starting to get antsy about owing the TaxMan come April 15th. The goal is to set an extra $2,000 aside for an estimated tax bill. Not sure exactly how it’ll shake out in April, but this will let me sleep better between now and then. If we don’t need it, that’s great – but I’d rather have it just in case.

How’s your income statement looking this month?  What bucket would you sort NPR contributions into?  How nerdy is it that I really spent time thinking about this?

 

20 comments to PoP Income Statement October 2012

  • That’s a ton of rewards! Great job! Gas is always hard to predict with oscillating prices.
    femmefrugality recently posted..When Procrastination is Frugal: Free Shipping DayMy Profile

    • Gas is a bit hard to predict, but Mr. PoP also recently copped to driving around at lunch most days “just to get out of the office” the last two months. We figured out that new habit corresponded pretty strongly with the big increases in our gas spending the last two months so he’s now going to try and change that habit. *fingers crossed!*

  • That is a very detailed statement. I have yet to create one that in depth. We have a quarterly net worth statement, but that’s about it.
    And about the not itemizing, we don’t do it either. People at work look at me like I’m nuts, but our mortgage interest is too low to make much difference. We’re usually about 1k short of itemizing. Keep on paying down those mortgages early.
    Justin@thefrugalpath recently posted..Friday’s Fork in the Path: Posts that Kept me on Track 11/2/12My Profile

    • It’s actually not hard to keep track of the details since we do it in mint. Now that I’ve got it set up, it takes me about 5 minutes to double check the numbers and drop them in. I like the detail because we tend to have “lumpy” spending with relatively big things coming up every few months – next month it’ll be RE taxes!

      Yeah, we even hired an accountant for the first year ever last year to do our taxes (we wanted to make sure the duplex deductions were all on the up-and-up), and he double checked the itemizing bit. Even if we pay two years of RE taxes in a single year, we still might not have enough deductions to itemize – and I think it’s mainly because we bought a really reasonably priced house. That and we’re married. A single person with these expenses would be allowed to itemize and get a bigger tax benefit.

  • [...] Mrs. Pop and I discussed some ways to keep costs down in November. The frustrating thing about our October expenses was that the stuff we spent too much on was totally in our control. There were really no [...]

  • [...] subscribe to our RSS feed and we'll keep it coming!  Thanks for visiting =) When we reported our expenses from October, we admitted that we had gone a bit overboard on both food and gas spending.  And we resolved to [...]

  • Marilyn

    I commend your blog commitments, and particularly your courage in publishing such private details as your personal financial statements. But there is one thing that baffles me with your expenditures. From June thru Oct, your giving has amounted to just $150 for the single month of Oct. Correct me, if my observation is wrong, but your household is so blessed with such a high income, yet I can’t figure out why your giving is so low.

    • Marilyn,

      You’re not wrong, but it’s not quite the whole picture. Other giving that we take part in generally just gets lumped into the “Shopping” line item on the Income Statements – at the start of this post, I mentioned how I struggled with whether or not to categorize this NPR donation as charity or as media spending. In general, the reasons behind putting charity spending under “Shopping” in income statements are largely because the charities may not be 501c3 registered (like donations to cover a hospital or funeral bill), or the giving also provides us with some benefit – like a donation to run a race in support of a homeless shelter, purchasing a wreath to support a school group, or sponsoring some gifts for needy families at the holidays. The tax deductions on most of these are negligible, so we account for them as “shopping” rather than giving.

      That said, even when you add that all in our giving is still probably no more than 3x the $150 you found on our income statement. Which you’re right – is still relatively low in relation to our income.

      Mr. PoP and I have talked about this a fair amount, and while we do donate some time in addition to some money to causes currently, one of the goals of reaching financial independence early is that it would enable us to have more time to share with causes we care about. Our thinking on it goes something like this: Even at our relatively high pay, our employers still profit off of our knowledge, experience, and efforts. If we no longer had to sell them 40+ hours/week of our time – it would allow us to donate time whereby non-profits could “profit” from us in the same way our employers did – but even more so, since they wouldn’t have to pay us. In short, we think the time we can donate in the future is worth much more than money we could give today.

      We see many of our retired friends donate their time in retirement, and for many of those organizations the donation of their time and knowledge is invaluable. We look forward to being able to start giving that kind of time 20-30 years sooner than the typical retiree.

      That might not square with everyone’s thinking – I know that many follow strict tithing requirements as ascribed in their religions. But giving back over the long term is definitely a priority for us, and we think our current mode is more likely to provide more value to our donations over the long term rather than worrying about it all squaring as a percentage of our income in the short term.

      • Marilyn

        Thanks for explaining your giving priorities. This PoP blog is among several I have consulted since the summer, as I turnover a new leaf in managing my personal finance. And what I tend to do is look for the similarities in good PF trends, and look even closely at the trends that are either omitted from mainstream PF advice, or that are just very unique. Your giving priority jumped out at me, and that is why I commented on it.

        If I may comment further on your response, it seems that you are making a major sacrifice in the short term, that of delaying for yourself the highest gratification to obtain from one’s labour/sweat, i.e. selfless giving. Plus, like everyone else, you have no guarantee of being alive, nor knowing what your station in life will be in 20 years, or even 20 days. The saying goes “Today you’re here, and tonight you might be gone”.

        Therefore, why risk losing (i) an opportunity to create positive change for the less fortunate or for your favorite causes today, while (ii) gaining the reward of knowing that today while you have the means, you did your part to make a difference. It seems that your giving plan, a “long term” one as you describe, is heavily dependent on “tomorrow”; but remember, tomorrow is promised to no man.

        Back to me, and my renewed PF managing track, I am grateful to finally reach the point of positive cashflow in my finances. Its only been 3 months, but what I find most rewarding is not the growing amount of income, but the growing portion of that net income that is not mine, that which will fund some needy individual, or worthwhile cause or entity.

        I think I did myself a disservice by delaying this form of gratification for so long. Not any more though!!!

        • Thanks for your thoughts on giving and how rewarding you’ve found it as you’ve worked at managing your finances.

          You’re right, one or both of us may die tomorrow. In which case, we have enough life insurance on either of us that pretty much all debts would be paid off and the remaining person would be pretty close to financial independence. So it wouldn’t change that timeline for the remaining person dramatically – so the remaining PoP would still have much time to give in a few years.
          If we both die, we have beneficiaries set up on the accounts that understand our values and who we believe would act accordingly… but maybe we need to revisit this and be more specific in our desires to those beneficiaries.

          Like many other people, we don’t really relish the thought of imagining ourselves dead – but you’ve given us some food for thought on this that we’ll definitely keep in mind as our needs and priorities change.

          Thanks again for the thoughts and comments.

  • Marilyn

    And you have given me some food for thought too as, until now, I had largely looked at giving of my substance to be the principal thing. With the PoPs’ emphasis on giving of your time & expertise I see a new perspective that I hadn’t tapped into as yet, and one that I really want to discover. I’ll resolve to add this dimension of giving to my planning for the new year. Thanks for taking the time to share your thoughts with me.

  • Thank you, too! These are the kinds of discussions we were really hoping for when we started this blog, so you really made my day with this one.

    Would you mind if I used our conversation here as the basis for a post? I think it would be interesting to share with others and get additional perspectives on how different people view their charitable giving.

  • Marilyn

    … “my” musings …

    • Check the blog tomorrow, Marilyn! I’m posting our conversation – so hopefully it’ll spark some good discussions with more readers =)

      The post will go live around 6am Eastern tomorrow morning.

  • Marilyn

    Thank you. I’ll check it out!!!

  • [...] a PoP reader named Marilyn commented on a post that’s almost a month old – the PoP October Income Statement.  Marilyn asked some very pointed questions about the PoP charitable giving habits, and I found [...]

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