Looking at our money and our budget, there are a few things that have changed over the recent months, and it will require some change in planning on how we approach our money. One of the things we'll have to look at it how we allocate extra money.
Where Is This Money Coming From?
Everybody will define this differently, but for us the extra money boils down to a few different areas.
- Credit card rewards. Most of our spending is done on cash back rewards. As such, we'll have a few hundred dollars in rewards after cashing in all of our rewards.
- Tax refund. Last year we had to pay on our 2014 taxes. This was largely because of a few things: I switched employers and our witholding didn't cover us as well as I'd anticipated due to some changes in insurance coverages and such. We also realized some stock gains, and also cashed in some savings bonds that had fully matured. In 2015, we should get a refund, as our withholding was adjusted, we didn't do so great in the markets, and didn't cash in any rewards. Our taxes are still out to our CPA, but a back-of-the-envelope estimate shows that we should get a couple of thousand dollars.
- My wife's side hustle. My wife runs a really cool shop on Etsy where she designs custom invites, thank yous, wall arts, and similar products. Up until recently, pretty much everything went to funding our recent Disney World trip.
- Pet expenses. Our cat recently passed. We are going to give ourselves some time before even considering whether to get another pet. Still, this will help our budget as his food, vet, and medicine bills were not cheap.
So, these are the four areas that we see working in our favor in terms of cash flow. Some are one-time things and others will be more ongoing.
So, what to do? What to do?
A Couple of Needs, Some Wants, and Looking Toward The Future
Honestly, there are a few things that we will probably do with the money. Not all of it is flashy, but it's all (OK, mostly) helping us strive toward goals like saving for retirement, saving for big purchases, and being able to do enjoyable things without taking on debt.
Here are a few ideas about our extra money. The splurge type stuff first:
- New wireless router. Typically our credit card rewards money has funded our purchase of new electronics . We've purchased all of our TVs with new flat screens by using credit card rewards. Along these lines, we're looking for a new wireless router. The one we have now is at least 7 years old, doesn't provide the latest security, and the coverage kind of stinks compared to what's available today.
- Vacations. Even though we aren't piling as much into our travel fund as we did to fund our Disney trip, we'd still like to take a family trip every couple of years. We liked Florida and have never taken our kids to the beach, and so we're considering saving a smaller portion of my wife's business toward a trip to the Tampa / St. John's Pass area.
- Other travel. We do most of our traveling with our RV. Every couple of years, my wife and I like to consider a small anniversary trip in the fall. These aren't extravagant or largely expensive, but stashing a few hundred bucks goes a long way.
- Entertainment. We both used to be pretty frequent concert-goers but kind of stopped once we had the family. We have done a few concerts and really enjoyed it, so we've decided to try to do 1-2 concerts per year. Putting some money toward a specialized entertainment fund is a good goal that will let us buy tickets and a night out without guilt.
- Furnace Fund. Last year we found that our furnace is starting to fail. We've taken some measures to slow this and are very carefully monitoring the device. Eventually it will have to be replaced. Continuing to save for this or other big purchases that might come up is important to us.
- Retirement. Bumping retirement contributions is never a bad idea.
- Kids Activitie. We set aside money for some of the big things that our kids like to do. Summer camps, swim lessons, dance lessons, etc.
- Replacement Car / RV. We are proud that our two cars and our RV are from model years 2006, 2007, and 2004 respectively. However, the bottom line is that eventually they may hit the end of their useful life. We save for this and could likely replace one without having to take on a loan. With all three at that age, it could be that more than one would need to be looked at in a shorter period of time. We will definitely be upping the allocation here. We don't want something to leave us unprepared.
So, that's really about it.
Readers, I'm curious what you think of our plans for extra money? Have you had any favorable (or unfavorable) budget changes over the past months? How have you worked to incorporate them into your spending plans?