Next month my mortgage payment is going up by $200 thanks to an adjustment in the escrow account for city taxes I mentioned back in August. So I’m re-budgeting for the remainder of the year and thought I’d explain my budgeting system while I’m at it.
Continue reading “My monthly budget, v2.0”
An ounce of prevention is worth a pound of cure
I like including a quotation at the end of my posts, but today I included one in the title too as a added bonus. You can earn extra credit if you know who said it! I recently wrote about having an emergency fund and while writing it, my brain cell started to think, “is there anything I can do to prevent myself from having to use my emergency fund in the first place?”. It turns out there is, it’s called managing risk and it’s done all the time in project management.
An emergency fund is money that’s put aside in case of an emergency. That was easy wasn’t it? But how big should it be and where should you even keep it? Your answer is likely to be different than mine. But I realized yesterday that I don’t really know why I’m keeping 1 year’s living expenses in my emergency fund. It’s time to re-evaluate.
It’s the Fourth of July today which means it’s Independence Day here in the US! That’s as good a reason to talk about Financial Independence as any I can think of!
As a Brit living in the US, I usually joke to my friends that I don’t celebrate this holiday since it represents the legal separation of the original Thirteen Colonies from Great Britain back in 1776. But of course I do celebrate it, and I enjoy living here in the States. Although I am looking forward to visiting my family in the UK later this year!
Is it better to pay down your mortgage or invest more? I tend to go back and forth about this – I don’t like having a mortgage but I do like having an increasing dividend stream. And in a crisis, my investment portfolio can be sold but the equity from paying down my mortgage is harder to get at. My current plan is to invest all spare money after monthly living expenses and savings into dividend stocks in my taxable account rather than make a concerted effort to pre-pay the mortgage. But does this make sense? Let’s take a look.
Your budget is your most important guide on your personal finance journey. It tells you where you’re headed and how long it’ll take to get there. Like any tour guide, your budget must be honest and realistic to be useful.
I needed to re-calculate my monthly budget for the remainder of the year now that I’ve sold my second house. Here’s the result.
I attended a training course  at work last week – nothing too exciting. The class was being held in an older building which has seen better days. As I walked to the classroom I encountered a bucket placed in the middle of a corridor and right above it, a hole in the roof. Which made me think that Personal Finance is really about how best to manage a leaky bucket that’s collecting water from a leaky roof.