Monthly Money Check: How Rich Spends $2,000 On Food — February 2017

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Hola Pennita,

You cut 3 years off your student loan debt! Well done. Now cozy up in your hygge quilt, pour yourself some glogg, and take a gander at my finances. As with last month, I’ll start off with a net worth update before moving on to my expenses, particularly my .

My goal is to have a million dollar net worth at age 45. Specifically, before I turn 46 in September 2021. When I started tracking this in September 2015, I had a net worth of $455,169.63. Today I’m at $568,367, a gain of $113,197.37!

Pretty good, but I’m not quite on track with my goal. To reach the goal I needed to average an increase of $7,600 per month, but so far I’m only averaging an increase of $6,658 per month. Doh! Consequently, I’m $16,002.63 behind the curve. Here’s a graph showing my progress. The blue line is the pace I’m on, while the black line is the pace I need.

Click on image to enlarge

Reasons for hope: Mrs. Rich and I both got promotions in the past year. Our retirement savings alone get us close to $7K per month, and certain gains tend to come in chunks (like our business LLC). Reasons for despair: Every month that we’re off the pace will make it harder to make up ground.

Here’s a breakdown of our net worth as of the end of February.

Click on image to enlarge.

So far in 2017, our average increase is $7,293.53 per month, thanks to January. February was an anomaly and our net worth went down. The culprit was that we paid a $12K preschool bill. I expect March to be a big gainer because we get paid 3 times in the month. April will be a wild card because we will have a tax bill, but at the same time we might record increases in our LLC (illiquid investments in farmland and commercial real estate). I’ll write a post on those sometime.

One final note on net worth. The excellent blogger over at Make Wealth Simple says I’m not calculating my net worth correctly because I’m not including valuables, vehicles, and pensions. I’d get a big bump if I started including those: my car + valuables total around $35K, and my wife and I both have pensions. So, maybe my true net worth is higher, but for the purposes of this blog I want to reach my goal without taking those items into account.

Okey Dokey, moving on to the monthly expense nitty gritty. I did a comparison on January and February, and once again we spent more than $2K on food! Incredible! Check out this comparison chart and that loooong line at the top.

Click on image to enlarge.

Food! For readers who don’t know me, I’m not a fat man. So what gives? Well, our grocery bill appears to be stable at $1200 per month. At first I thought it might be because we’re living overseas, but I confirmed this number is on par with what we spend in the States. We pay for quality, fresh food. Currently, one third of the total is spent at our local fruit and vegetable place, one third at our local grocery store for basics like bread, eggs, and cheese, and the final third goes to specialty items we buy from the local deli or order online. When we eat at home, it’s usually homemade and healthy. We’re not going to change this to save money.

As for the restaurant portion, we came in at a whopping $1,062.49. I know exactly why — my best friend visited in February and we spent $500 on 2 meals. They were worth it, as I noted in my latest Happiness Report! To answer your question about restaurant reputations Penny, I’m glad you enjoyed the Outback, but chains like that (Chili’s, Denny’s, Friday’s, Applebee’s, Stinky’s, etc, etc) don’t do it for me.

This is not about being snooty, I just don’t like the food … or the atmosphere … or the huge portions … or the feeling in my stomach after I eat a Bloomin’ Sriracha Blast Super Chicken Stuffed Slider Cheese Popper.

Incidentally, I loved Olive Garden when I was younger. Who doesn’t like butter? But when I got older I experienced some GREAT Italian food — not always fancy or expensive, just authentic and delicious — and Olive Garden doesn’t please my taste buds anymore. Have you ever had something so good that it ruined your previous experience of something else? It’s human nature. I don’t blame anyone for thinking Olive Garden is great Italian food. I just can’t do it, I’ve seen the light. As Plato wrote in The Cave, “How could they see anything but the shadows if they were never allowed to move their heads?”

So that’s the deal with food and restaurants. I also had to rent a car during my friend’s visit, so that’s the bump in transportation. Here’s the complete list of income and expenses for February.

Regular expenses clocked in at $4,630.25. That’s a decent number for us because our salaries bring in $12,000 (during a month with 2 pay periods). It helps that we don’t pay for housing while living overseas.

Irregular expenses fluctuate bigtime. As you said, it’s always something, eh Penny? Last month it was preschool, this month it’s the dentist and a plane ticket for my mom AND YOUR MOM to come visit! However, I’ll be reimbursed for both these items, so they’re temporary expenses.

By the way, my mom LOVES Outback Steakhouse. Unfortunately for her and fortunately for me, there are no Aussie-Tizers in this country.

The most surprising thing to me is how little we’ve spent this year on everything other than food. I’m pleasantly surprised, actually. Granted, all this will spike when we we move back to the States in August and start paying for housing again.

So, what do you think? Is my food spending out of control? And a couple questions for you: If you started making more money, at what point would you start to lose benefits like the Earned Income Tax Credit, food support, or low cost internet? On a more hypothetical level, what would you do if you had no student loans and made $12,000 per month? What do you think would change about your spending?

Rich

13 Replies to “Monthly Money Check: How Rich Spends $2,000 On Food — February 2017”

  1. If there’s one thing that has consistently brought joy and happiness to human beings over thousands of years, it’s gotta be Food! Seems like you’re carrying on a long tradition in your household, that’s a good eating month! Since net worth is generally not linear, I’m certain you’ll be reaching your goal in no time, congratulations on the discipline and focus! Max

  2. If I was bringing in 12,000 a month, I’d be buying multiple houses in my area and look to build passive income. Once I replaced my income, I’d quit my day job and work on my business, write a book, etc. Is the 12,000 post or pre tax?

    Right now, I’m bringing in about 8k a month, so I’m getting there, but have to stay focused if I want to get to my goals!
    Erik @ The Mastermind Within recently posted…Blog Traffic and Income Report – February 2017My Profile

    1. Good thoughts Erik and good question. The $12K is post tax.

      I love the idea of passive rental properties — but it would probably be more work for us than our regular jobs! We get some passive income from our investments in farm land and commercial RE, but it’s not enough to live on.

      My wife and I are both lucky because we like our careers, which provide solid income as well as opportunities to see the world. We’re not trying to retire too early (more like mid-50s).

      Actually, the way I look at it, we are trying to live our ideal lifestyle as much as we can while still working. I’d love to write a book too — I don’t have the time to do it quickly, but there’s no reason I couldn’t start tomorrow if I felt ready …
      Rich @ pennyandrich.com recently posted…The Squirrel Story: How Rich Plans To Increase His Giving (And Not Be An A-Hole)My Profile

  3. Hey Rich, Nice Net Worth tracker. You guys are doing awesome.

    I wouldn’t say you are spending too much on food as such because I think you need to pay extra for good food and people generally don’t spend enough on food. Now 2000 $ that is a lot, but depends also on where you are based :-).

    I guess the question boils down too, how much are you willing to trim fat to reach your goal of 1 million by 45. Because there is no doubt in my mind that you can pull this off with a few tweaks.

    Nice month of Feb !

    1. Thanks MWS — I enjoy thinking of new ways to create charts for my finances. Nerd alert.

      I’m not willing to trim too much fat (or fruit), to meet my goal, probably because the goal will not result in a life change (like retirement). Maybe it’s the wrong goal!?

      However, I do think we have a good shot at increasing our savings rate as we increase our income over the next 4 years. It’ll be a challenge, which is okay … I kind of like the goal being slightly out of reach.

      Of course if I calculated net worth correctly as you suggest, I could meet the goal sooner but it’d feel like cheating 🙂

      Thanks for the comment.
      Rich @ pennyandrich.com recently posted…Book Review: Tribe — Rich Digs The Modern FoxholeMy Profile

  4. First I wouldn’t count your home, cars, or valuables in your net worth unless you plan on selling them. They don’t generate passive income that can sustain you and unless you plan on selling them you won’t be able to use them to pay a bill later on.

    It looks like your doing decently. You could save more by lowering expenses in areas, but that depends on your goal. If your goal is not to retire early you appear on good track to retire at a normal 65 with no issues. That’s obviously a personal choice.
    Full Time Finance recently posted…Getting Others to Change their Mind through Active ListeningMy Profile

    1. Yes, I agree it’s all about goals and personal preference. I think I’ll be able to retire in my mid-50s with 1.5M in retirement and a pension, but I’m not in a hurry. We are trying to live our ideal lifestyle as much as we can while still working. That said, I would like to gradually increase passive income in case I turn 55 and all of a sudden have the urge to get out fast.
      Rich @ pennyandrich.com recently posted…Book Review: Tribe — Rich Digs The Modern FoxholeMy Profile

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