What’s that saying about the best-laid plans? I seem to only recall people saying “best-laid plans…” with a sort of shoulder shrug when something doesn’t go right.
Well, that’s how our March went: typical in the unexpected yet inevitable expenses that always seem to pop up right when I don’t want them to.
We decided to sell our house after years of renting and waiting for the market to rebound. This turned into a roller coaster of emotions as we faced the prospect of duel mortgage/rent payments with no rental income. First came the apprehension, then the confusion (the realtor decided to let the renters stay month to month), then dread (the realtor texted that the renters “are not clean” and had to go), then frustration mixed with relief (we had to give a 60 day notice, so we’re kind of in a holding pattern but at least we’ll have rent coming in) and finally sadness (since listing our house, the Zillow value has dropped by almost $20,000!?).
Needless to say, the Zillow drop has affected our net worth number substantially. But if you invest in property or stocks, ups and downs are to be expected.
So how about our income vs expenses? That’s the area I’ve most been interested in tracking and improving. I really want to know that we’re living within our means, not just assume we’re good because I can pay the bills.
Since I did a budget refresh in January, my numbers were a little off due to the actual posting date of payments, versus the recorded date. For example, I paid our rent in December, but it didn’t post to our account until January, so it looked like we had 2 January rent outflows in our income vs expenses report.
February looked much better, jumping from a negative $1,100 to a positive $67. Not where I want to be, but digging into the numbers, almost $500 of those “expenses” were transfers to investment accounts (which are tracked separately), so not too shabby.
March’s numbers are much more…interesting. On the surface, we were back in the red, negative $250 for the month. But our budget was in the green. We didn’t have any overspent categories. How can we have spent more than we earned, but not have gone over budget?
Simple. We had to tap into our sinking funds.
Remember when I pulled money from a generic emergency fund and spread it across our sinking fund categories? Well, here’s where it paid off. We had 2 categories that saw a huge spike in expenses this month: medical and car maintenance.
Those were two of my funded sinking goals. We knew there’d be some expense there, we just didn’t know when. Well, turns out it was last month.
I have mixed feelings about March. On the one hand, I don’t like all the red: our net worth dropped and our spending outpaced our earnings. Yet I’m thankful for the data I’ve been gathering since it shows me we’re still on the right track. I’m also thankful I didn’t feel that sense of dread, of being punched in the gut when a big unexpected expense happens. I wasn’t happy about the $300 car bill, but when I saw I had money in the budget to cover it, I felt a sense of relief.
While my plan to save money for the eventual loss of our rental income didn’t really pan out, my planning for the unexpected got put to the test and passed. So still a win.
So at the end of March where do we stand? Well, comparing our numbers to January (since I forgot to do it in February), our net worth took a giant hit (-$22,498), as did our sinking funds. Which means April is shaping up to be a rebuilding month. We need to start adding back to our sinking funds and continue to build our mortgage buffer. Fingers crossed we don’t have too many surprises this month.