As you can see we had another very good month. Some quick highlights are as follows:
Revenue vs Expenses
- In our Revenue we showed a nice pick up compared to prior month due to largely a triple pay period by my wife. We had planned at a minimum she would work through the pregnancy until t he end of June to take advantage of that third pay check before she went on leave. (She gets paid every two weeks, so it may “feel” like she got paid 3 times in June she really did work those 3 pay periods at some point)
- My income was slightly less this month compared to prior due to the correction from May in which 8 hours of my PTO time was not deducted from a previous pay period. So this is a neutral change, but does reflect on our June revenue statements.
- Expense management continues to be a high point for the month of June as we were able to come in our lowest month yet since we have been tracking our finances as shown in the below graph. This is doubly impressive as we were able to do this while still making a $735.60 payment towards our student loans.
- We made a small dent in our student loans this month paying down $735.60 towards the loans. The goal is to hit at a minimum $500 towards each month going forward and the minimum balance due is about $390.
- On a good note we have been approved for the “Diamond Program” in which our interest rate on both loans is reduced by .25% for each loan as long as we continue to make payments on time. While this won’t make or break the bank it is another example of how the world works in your favor financially when you have your moneys in order.
- You may also notice a large bump in our student loans as the new balances are $8,424.91 and $20,981.68. Now that all of our student loans have fallen out of the g race period it makes no sense to delineate between subsidized and unsubsidized loans as I did before. So the new number is much higher than the $17,000 and $3,000 broken apart, but the change is largely academic.
- June was a stable month in that we did no major money movement between accounts. We continue to keep out savings accounts at a minimum as they value is just not there at the moment.
- We again horded cash which is very important. We learned that our landlord needed to move back into her home and we needed to find a new place to live. We have until November to find a new home but after some discussion we decided that it would be in our best interest to move before the baby is born rather than after. So the extra cash we have built up will make this potentially stressful situation bearable financially, though still a stress producing situation. (I will make a future post on the cost of a rental move to give our readers an idea of what the simplest of moves can cost a family)
- From May to June we saw about a $400 improvement in our stock position with PDLI. Again, I am not to concerned as this is a late fall stock play for the special $0.50 dividend that will be presented. I am anticipating a gradual return in value which our break even point is at about $6.45.
- Over the past month both of our 401k plans made a small gain. What is interesting is a 401k plan my wife had from her previous job finally became fully vested so we noticed a $300 gain overnight in that account.
- My 401K plan peaked over $4,000 for a moment in June, but the market quickly corrected and pushed it back down. I am continuing to do a 6% contribution and largely ignoring the fluctuations in the market as retirement is a ways off.
We broke into the positive!
O.K. so maybe not 100% into the positive, but our Long Term Net Worth did break that Zero line which is exciting. We calculate our Long Term Net Worth as our liquid net worth (Checking, Savings, Stocks, Money Market Accounts) + long term net worth (401ks) – our liabilities (student loans in our case). So if one of us were to die tomorrow we could pay off our debts! Kinda a morbid sentiment, but still reason to celebrate.
This change in net worth is again due to largely building our cash assets by spending less than we earn. There was also some minor gains in our stocks and 401ks that helped push this over. This may bounce back under that evil zero mark as money is diverted to covering a new rental house (rent and deposits) and the medical bills from the baby’s birth, but was still an exciting blip non the less.
June was the final month in which we were true DINKs (Dual Income No Kids), as my wife quits her job on July 2nd, and we made every effort to capitalize on our changing financial dynamics by proactively reducing our expenses well before the big date giving us a decent cash cushion.
July will be an interesting month for our household as we go through an unplanned move. Since we did have the cash reserves already built up the stress will not come from the financial arena, but rather just the stress of trying to move while 8 months pregnant. The silver lining is it will be an in-town move and both my wife and I have made many friends who will help alleviate the moving stress.
Another goal of ours was to build up enough cash to cover the birth of our son in August (due August 19th). This is unnecessary as with the job I currently have the hospital bill is written off so we will only be liable for the physicians fees. I am figuring these cost to come in somewhere between $1,000 and $2,000. That will be further cushioned by our Flexible Spending Account which we proactively loaded at the beginning of 2010 with $2,000. Now by August the balance will be closer to $1,000, but that $1,000 will go a long way in covering the medical cost. Also it is fun to think that the government will be helping pay 25% of the cost due to the pre-tax nature of the Flexible Spending Account.
So expect from me in the month of July a brief run down of what those cost could be for the most basic of housing moves, rental to rental in the same city, and another financial update in early August.
Be sure to keep track of our progress by reading some of our older Month End statements below. Always fun to read over these again to see if your predictions come true.