BiggerPockets Money Podcast - 276: Carl and Mindy’s Spending Summary: Why Did We Go So Over Budget in January?

Episode Date: February 18, 2022

Emergency funds, frugal experiments, free photons, and “thoughtful spending” were just a few things that came to light during Carl and Mindy Jensen’s January 2022 budget recap. If you didn’t know already, Mindy has been publicly tracking her expenses and budgeting for BiggerPockets Money listeners (and the world) to see. But of course, as soon as Mindy shared her public budget, things started to go awry. Nothing says “let’s start the month off right” like car repairs, furnace replacements, and sky-high gas prices. But, Mindy isn’t a quitter! Even with some big emergency expenses, she and Carl have managed to stay within budget for most of their costly categories in spite of life's fun financial curveballs.  Carl and Mindy discuss their January “frugal experiment” including hotels and air fryers, how “dry January” became “moist January”, and why this financial powerhouse has opted out of the traditional emergency fund. If you’re starting this year with a few budget busters like Carl and Mindy, don’t let it keep you from hitting your overall 2022 spending goals. Track it, stick with it, and shoot for FI! In This Episode We Cover How expense tracking inadvertently stops you from overspending  Using money in the most efficient way possible so you can increase your “thoughtful spending”  Budgeting wins (and challenges) that Mindy and Carl faced this January  Preparing from unexpected budget busters and whether or not an emergency fund is necessary  How to allocate large bills throughout the year so you don’t go over budget  Splurging on things you truly enjoy while keeping everyday costs as simplistic as possible And So Much More! Learn more about your ad choices. Visit megaphone.fm/adchoices

Welcome to the Bigger Pockets Money podcast show number 276, Finance Friday edition, January spending recap edition. No matter how much you have, even if we had $100 million, which we don't, I would still track it, I think, because I like to think about efficiency, and it's not about frugality. It's about using money in the most efficient way possible. And even if I had all the time in the world, I would still plan my trips to be most efficient in the car to not go during.

rush hour. So I think about efficiency all the time, and that's what it comes down to for me. It's using money in the best way possible. Hello, hello. Hello. My name is Mindy Jensen, and with me today is the host of the Mile High Five podcast and the creative genius behind 1500 Days.com and all of the dinosaurs and fart jokes you find over there. Also, we've been married for like 20 years or something. It has not been 20 years. How long has it actually been? almost 20 years. It's like 19 years and 11 months, right? It's like 19 years and 11 and a half months right now. Nobody wants to listen to us complain and argue over how long we've been married.

It's been a while. If we keep arguing like this, we might not make it. So we got a lot of positive feedback from our first episode. I am very excited to talk about our spending. if you've been following along at biggerpockets.com slash Mindy's budget. You will see that we have blown our budget kind of out of the water. Oopsie. So we're going to talk about what happened, what went wrong, what went right. The normal disclaimer for Finance Friday doesn't really apply today, but I'm going to read it anyway.

The contents of this podcast are informational in nature and are not legal or tax advice, and neither Carl nor I nor Bigger Pockets are engaged in the provision of the legal tax or any other advice. You should seek professional advisors for tax. Oh, I don't have this memorized. And I don't have it. I'm not reading it in front of me. You should seek professional advice for legal tax and any other advice that you need. But we're not giving advice. We're just telling you what we did and what we did wrong. So anyway, on to the show. Tax season is one of the only times all year when most people actually look at their full financial picture, including income, spending, savings, investments, the whole thing. And if you're like most folks, it can be a little

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So, Carl, welcome back. Thank you for having me. You're welcome. Thank you for allowing me to force you to come back. we're going to bear our financial misdeeds to all of my listeners. But first, let's talk about this. We started tracking our spending for the first time in, it's got to be years. Like every January, we're like, we're going to track our spending in like January 2nd.

Never mind. And how did it feel to track the spending this year? It feels pretty good. I really enjoy the exercise because, so I'll back up a second. we do is we have an app on our phone and every time we purchase anything, we have to enter it on there. So the very act of doing that, it's kind of like quantum mechanics. You can't observe the phenomenon without changing the phenomenon. Any science nerds out there? So the fact that I have to record the purchases actually changes what I purchased because it's like coming back after you got

an F on a test and having to tell your mom when you were in elementary school. I don't want to buy something stupid and have to enter it on there. for the world to see. I'm trying to think of an example of something I bought or did not buy. Like beer, I think we hardly purchased any alcohol in January. I don't want to, uh, yeah. It was dry January. It was. We weren't completely dry. We were moist January, I would say. Ew, you can't. That's gross. Yeah, moist January. You heard it here first. But yeah, it changes our behavior. And I think it makes me better because I have to pay attention. And, um, I do less stupid things if I'm forced to acknowledge everything I purchase.

I think that tracking our spending is really important because it makes you conscious of your day-to-day spending because it's so easy to just swipe your credit card. I mean, how do you make purchases? I don't even, I mean, I do have cash, but I spend very little cash. It's always just swipe a card. And it's so easy to swipe a card without thinking about it, you know, towards the end of last year as we were talking about tracking our spending publicly, I would find myself at the grocery store, you know, just, and I don't even swipe anymore.

It's a chip card. You just stick your chip in the thing as you're gathering up your groceries, and then it does its thing. You don't even look at the total, really. So this is causing me to become more conscious of my spending. And because we had, spoiler alert, some budget blowouts, it caused me to be even more conscious of my spending. Ooh, we spent so much in these categories.

I really want to be conscious in other categories. The groceries was something that I was sure we were going to just completely blow out of the water. And I was very, very conscious of how much I was spending at the grocery store and really tried to make meals out of what was already in the pantry. So your friend, J.T. Hi, J.T. asked us an interesting question. Do you want to, we had them over for dinner.

in January. What did J.T. ask us? We had a well-per-inner in December. Oh, December time. And I had already talked about doing this spending tracking. He's like, why are you tracking your spending? You know, you don't really need to. And the reason that I wanted to track spending is because it has gotten so out of control. And it grows over time. You don't start out thinking you're going to spend $40,000. And then you spend, you know, $75. It's, you know, it's, it grows over time. You don't start out thinking you're going to spend $40, it starts off. You think you're going to spend 40 and you spend 41. Whatever, no big deal. And then you spend 45 and then you spend 55. And then all of a sudden you're planning for spending 40, but you're spending 80. And if your investments have grown and doubled, you're okay. But if you are

in the middle of a stock crisis or if you haven't had the successes that have allowed you to keep up with that spending, you could find yourself running out of money. So I wanted to make sure that we're not going to do that because you're unemployed. That is correct. I am. I want to stay unemployed. I'm sorry. Do you have a job I don't know about?

I bring in money. I am vastly underemployed. Purposely unemployed. For those of you listening, we're thinking, wow, that was really weird, Mindy. No, I teased him about this all the time and we have spoken about. this. He doesn't feel bad. You don't feel bad, do you? No, no. And for those who don't owe me, I worked for a long, long time

and Mindy did not work, and we kind of just traded places. Yeah, it was a stay-at-home mom while our kids were little, and now he is a stay-at-home dad. Yeah. And tile setter, hence all the injuries on my hands. Yeah, he's been working on the

bathroom. But back to JT's question for one second, I think no matter how much you have, even if we had 100 million dollars, which we don't. I would still track it, I think, because I like to think about efficiency, and it's not about frugality. It's about using money in the most efficient way possible. And even if I had all the time in the world, I would still plan my trips to be most efficient in the car to not go during rush hour. So I think about efficiency all the time. And that's

what it comes down to for me. It's using money in the best way possible. I don't want to, I don't like wasting anything. Like when I see people throwing off food at a restaurant, that just tries me nuts. I almost want to get a doggy bag. That's what they used to call and, like, take their food. Like, those french fries, man, you throw them in the air fryer and it rejuvenates them. You're not taking somebody else's food. That's gross. I've never actually done this, but I've thought about it. I used to work at a steak restaurant, and at the time I was dating a guy who had a dog, and people would leave their steak on their plate and just, like, walk away, so I would take the steak home for his dog. But that's the only time I wouldn't eat that.

But yeah. Yeah. Not right. Don't take other people. food, especially in the age of a pandemic. Yeah, we digress. Way, way, way digress. You're a huge nerd, by the way. As you were saying, you want to be the most efficient with everything. I'm like, wow, what a nerd. I own it.

Should we talk about quantum mechanics more? No. We should talk about our wins. Yeah, let's go. Our wins and our challenges. Do you want to go with wins first or challenges first? Let's get the bad part out of the way. Okay.

When did gas get so expensive? Okay. Back on episode 243, Rameet Sati came on and talked about how he just wants to live a rich life and, you know, spends on things that are important. It doesn't like pay attention to prices. And I'm paraphrasing, I have never paid attention to the price of gas because I can't stock up on it. I need it when I need it. I can't like shop around. It might be five cents cheaper across town, but I'm not driving across town to say five cents a gallon.

And my car holds about 10 gallons of. gas. So if I drive all the way across town to say five gallons on five cents on a gallon of gas, I've saved myself 50 cents, but I've cost myself like 20 minutes. So 20 minutes of my time is worth way more than 50 cents. So I have never really paid attention to gas. Therefore, I said, oh, I'll spend about $100 on gas this month. And we spent a lot more on gas than just $100. Part of that is real estate agent work. I am a real estate agent. I was driving around all over the place. And the way that real estate agent reimbursement works is I can claim, is it 55 cents per mile on my taxes? I have no clue. Wow, you're the one who does the taxes. Anyway, I can claim

some amount on my taxes. So I go with mileage instead of deducting the actual cost of gas. And that seems to work out better according to Natalie Colity from colotax.com, who told me that that's the better way to do it. So I just track my mileage and I just happened to be driving a lot in January. So we blew the budget on the gasoline. Yeah, I have a solution, though. We have free gas that lands on our roof like every hour during the day. Do you know what I'm talking about? Is that photons for the solar panels? We do. She even knows the word, probably because I was talking about it last night in bed. All the time. Oh, dude, that sounds gross. It was hot. Our photon talk. Family-friendly show. Oh, it was photon. It was photon.

We weren't doing anything else. I don't even remember how that topic came up, but we were talking about photons, right? What was the context of our conversation? I don't know. You were talking about the sun. Oh, you were mad because I turned on the electric blanket because it was freezing. Oh, it was like, I don't know, 68 or 70 or I don't know what temperature it was. But for $10 worth of electricity, you can go 400 miles in an electric car, 10 cents a kilowatt hour times 100.

Oh, do we own an electric car? 10 bucks, and then you could go about 400 miles if you have an efficient electric car. Do we own an electric car? We do not. And why do we not own an electric car? Is it because your wife tells you not to buy an electric car, or is it because your wife tells you to buy an electric car and you keep not buying an electric car? Hypothetically.

Probably the former hypothetically. That's not true at all. Oh, does somebody love Tesla? Yes, that would be you. And does somebody want a Tesla? Yes, that would be you. So go buy a car. Yeah, someday we'll get one and then we won't pay anything else for gas

because it'll land on our roof every day. For free. Yeah, photons. And then we'll be better with our expenses. So we had more issues with cars in January. We sure did. So we have a car that we bought brand new in 2003 and have put almost no money into this car.

We had something, Tim's Toyota fixed something on it a while ago. Yes, it's 2003. We've probably spent about $1,000 in repairs. I've done all the maintenance myself. It had an exhaust manifold that rusted out and the radiator went. I blame both on the Midwest salt that they put on the roads. But in January, we spent more than we've spent in the first 19 years of the car's existence. And we had two things going wrong.

The first one was the windshield wiper pump broke, and you absolutely need that as I found out driving around in a snowstorm if you can't operate the wipers. And when the pump breaks, you can't... The wipers don't do much good because the windows get all crappy, super quick. And these kind of things drive me nuts because I looked up the price of the part, and I could fix it myself. I think the price is like $13.

But I can't stand working on cars. I just despise it. So I called up a place. Like, yeah, we could do it. It'll be like 250, like 120, 130 for the part because they mark up the part that's part of the business. And then the labor, like $129 an hour, I think. So we ended up actually having to pay someone to do it. I had too many other things going on, and I don't want to fix a car in sub-zero temperatures.

So that was like $200 and something. And then? And then, so I'm in my late 40s, and I had not cut. caused an accident in my entire life. So accident-free until January when I was driving around in a snowstorm. Ice storm. Ice storm, yeah. And it was very bad conditions.

I'm a pretty cautious driver. But the car split out and I hit a curb and damaged much of the front-right suspension. And that set us back, I think we're on $1,000. Yeah. And I had budgeted $100 for automotive, just, general automotive upkeep and repairs. I didn't think we would use it. And I have continued to budget about $100 over the course of the year.

I think that we will end the year, hopefully. We will end the year under budget because this was $1,000, but, or maybe it was $1,300. Maybe we'll still end the year slightly over budget. But we probably won't have to do anything else to the car. Knock on wood. Knock on wood. Knock on wood. Okay.

Yeah, it does have new tires. We won't need to do that. I changed the oil myself, and I already bought that last year. So, yeah, that should be it unless something else happens. Cue the ominous music. Okay. One last challenging category we had was household. This is a general catch-all category, and we basically just kind of ran

out of everything in January. So we ran out of laundry soap. We ran out of like bar soap. We ran out of pump soap. Kind of all of the soap. We ran out of all at the same month. So we went to the store and we bought a giant thing of soap and a giant thing of more soap and a giant thing of a different kind of soap. So we spent more than we thought we would, but I really believe that this will come in under budget next month. But who knows? We will, we will see. That is like I said, catch-all category. And I do think that for February, I'm keeping a lot of my numbers the same, just to see how it went in January. If January was just a fluke, then we'll continue keeping them the same. But if it turns out that household spending really is that much, every single month, I will increase it for March.

Let's move on to the wins. Yeah, what's the first one? You have groceries on there, and I did not check the list, but we actually went over on groceries, so I'm unsure why that's a win. Okay. First of all, you need to be more supportive. Second of all, we went $50 over the projected $650 grocery budget. I completely guessed at the grocery budget. I really thought that we were going to go significantly over.

We've had months where our grocery spending was $1,000 or $1,200. And, you know, some months you just run out of everything so you have to buy and stock up again. But other months, you just aren't paying attention. This month, I was hypervigilant. I really tried to eat out of the pantry and out of the cupboards as much as possible. And we came in at $700 for the month. And I thought that was fabulous. I'm super excited to continue that going forward.

I have put $650 for our February spending. goal as well, and I'm really hopeful that I'll be able to hit that. We do have three fewer days in February than we do in January, so fingers crossed. Yeah, we'll see. One thing I notice, one observation is, to back up a second, both our children, are vegetarians. And a lot of that, I'm fully supportive of that, but a lot of that vegetarian stuff costs normal than actual meat, which is quite surprising, and maybe that'll change over time. And I don't mind buying it for them, but you go buy a bag of those fake nuggets or fake corn dogs. And yeah, they're not cheap.

They cost more than a bag of regular chicken nuggets. Have you noticed that? I haven't. And I do need to pay more attention. I also try to stock up on that stuff when it is on sale. You can get it for $4 a bag or sometimes you can get it four for $5. So sometimes I will stock up when I see it on super sale. But yeah, you're right.

it can get really expensive. I would like to get them more into just vegetables and tofu. And that's the problem they don't like tofu. The little one doesn't like tofu. The big one will eat too of tofu. But then we've got to make two different meals. So I'd like to just introduce more fresh fruits and vegetables into their diet. Yeah.

Yeah. Our vegetarians do not like vegetables. So, yeah. Yeah, they're crackertarians. Yep. Yeah. Well, let's talk about moist January. Ah, moist January. So our friend, the mad scientist, came into town, and we were going to do dry January. And right after we announced dry January, he said, hey, I'm going to come into town and I'd like to see this brewery that's near you called Weldworks, which is really delicious.

And we're like, yep, it's going to be a not dry January when he's into. So we went and had some delicious beer with him. And then we were dry. for the rest of the month, right? Yeah, it was mostly dry. And we had football playoffs, and it was actually a really enjoyable experience. I have decided that maybe we'll have, like, slightly, I don't want to call it Moist February. Moist is such a gross word. Moist February, I guess I'm going to have to call it that now, thanks.

We have to find some alliterations, so March should definitely be moist, and maybe May too, like March, moist March. moist March madness that basketball thing they've got going on yeah so we have two different categories on our spending tracker one is for tap rooms

one is for alcohol maybe we have one for beer I guess beer that we buy at Wyatt's is going on the alcohol and tap rooms there we live in a city that has 13 microbreweries

and there's a huge microbrewery kind of community up and down the front range of Colorado, which is where we live. So we go to a tap room as a social event. Yeah, sometimes. But, you know, you can sit down and have a $5 to $8 glass of beer over the course of a couple of hours and still enjoy your friend's company. It doesn't have to be a super expensive engagement.

We're rethinking the alcohol, though, because now I'm starting to get headaches and drink it. Yeah, it'll be much less. I feel like such an alcohol is having two different categories out. What do we have like 25 categories and two of them are alcohol? Woo-hoo. Winning. Tax season is one of the only times all year when most people actually look at their full financial picture, including income, spending, savings, investments, the whole thing.

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In communities across Canada, hourly Amazon employees earn an average of over $24.50 an hour. Employees also have the opportunity to grow their skills and their paycheck by enrolling in free skills training programs for in-demand fields like software development and information technology. Learn more at about Amazon.ca. Let's talk about our frugal experiment for January. January's frugal experiment. We love the symphony, which is not frugal at all. We already bought tickets a while ago. We went to see Danny Elfman from Oingo Boingo, and he was having a conversation where it was kind of like a live podcast recording where he sat down with the conductor from the Denver Colorado Symphony Orchestra and they just had a chat.

And then afterwards, we went out to dinner and came back and saw the symphony play the music of Danny Elfman from Tim Burton movies. It was a super fun time, but we didn't want to spend a lot of money on a meal in Denver. Plus, there was not that much time between the two performances, shows. Yeah. Experiences. So we went and got blue pan pizza, which we picked up and had and brought back to our hotel room. And we have pictures of our frugal experiment. Do you want to describe it?

Yeah, and this was all my idea. So don't. 100% his idea. Yeah. And these are fun experiments. We don't normally do these kind of things. But I like chicken wings with my pizza. And if you go to a restaurant,

like 15 or 20 bucks, and I don't think this place even had that as an option, although I'm not sure. So what we did is we have an air fryer, and air friars are awesome. It's not quite as good as actually frying food, but it's almost as good. We brought the air friar with us.

We stopped at Costco, which is on the way down, and we bought a big bag of chicken wings. And when I went to pick up the pizza, you threw the wings in the air fryer. And by the time I got back, they were done. So we had budget chicken wings with our air fryer. What did you think about the experiment? How did you like the wings? And would you do this again?

I would totally do it again. I thought it was fun. The girls were super embarrassed that we were bringing an air friar into the hotel. I don't think that the hotel even knew that we were bringing an air fire in. I'm pretty sure they didn't care. I thought it was a fun, frugal experiment, and part of tracking spending is now I'm looking at it as a game. How low can I get my expenses while still enjoying my life? We could cut our expenses so much lower than we're doing.

But it would be kind of an unhappy existence. Like I could just eat beans and rice all day long and, you know, peanut butter and jelly and just not enjoy what we're doing and only stay at home and never do anything fun. But this was a fun way to have what we wanted without spending a lot of money on it. I would do it again, and I'm looking forward to February's frugal experiment. Yeah. Do we have any ideas for the February frugal experiment? Oh, I don't have any.

If you have any ideas, please email Mindy at biggerpockets.com, or you can post in our Facebook group. I will write a question, post a question in the group, which can be found at facebook.com slash groups slash BP money. You know, I have an idea. Are you ready? I'm ready. I know you like your toilet brushes, but we don't need to buy 15 of them every month.

So why don't you repurpose some worn-out household items into a toilet brush? For example, you could take an old toothbrush, tie it to a stick, and scrub the toilets with that. take a long time, but you'd be saving a couple bucks on toilet brushes and helping to save the world, too, if you want to look at it that way. So send me your ideas to Mindy at BiggerPockets.com or answer the question in our Facebook group. Or you can use a broom. Ew. Ew.

Ew. Gross. Okay. Next. Goals for February. Got any good goals for February? I have a great goal for February. How about we don't spend a lot of money on?

a stupid expense. Oops, too late. So we're recording this on February 8th. And if you follow along on our Facebook group, you saw that we have already had a budget buster yesterday. What happened? This kind of incidents tear me up inside because our furnace broke. I woke up and it was making a horrible screeching sound.

I'm pretty sure I knew what it was. I got out my multimeter. I verified the capacitor was okay. I verified that the motor was getting voltage. So I knew it was the Voltor. I knew it was the motor. I fired the thing back up and it went, it made this horrible, horrible sound.

Sorry. And I looked up the price of a motor and it was like $150 bucks online, but it would have taken a couple days to get there and I'm going out of town. And it was 13 degrees outside. So we had no choice but to call someone. And this always drives me a little crazy because how much did we have to pay someone to fix it?

I know a lot of HVAC people, so I know these people to be probably the cheapest and best. And they are very good. I don't want to, I can say their name, but they are very good and more affordable than other places I've heard of. But how much did we have to pay instead of the 150 bucks in a job that would have taken me like an hour or two? Was it $150? No.

Was it $300? No. They did come out right away. We were without heat for. less than six hours, but it was still $800. If it was me, I would have lived in the house for a week while waiting for the new one to arrive. Some of these parts are hard to get because HVAC is a closed industry and they don't want the common person to buy them. So they make it a little bit more difficult to get some of these parts.

But, yeah, I would have lived in the house called. How do you feel about living in a 40-degree house with a couple space heaters for a week until I got back from San Diego? But no, I feel that we have saved our money and invested our money wisely, and we can spend our money, even if it's $800 whole dollars on a stupid furnace part. We can do that easily, and we will, because I don't live in the 1600s, and I live now when we can have heat in the house. So as much as I hate to spend so much money on such a stupid, but it's like this big, too. As much as I hate to spend that much money, we did it. And now our goal for February is to make it more of a game and how little can we spend everywhere else? Because it is going to be an over month again.

Yeah. There's one thing I want to talk about. It is going out to eat. We did go out to one nice meal, and I'll back up a second. Last year we went out to eat a lot, and I think it was a reaction to how we were living because we were doing a ton of work on the house and COVID was going on, and all these other chaotic things happened, so it comes to the end of the day, and you're like, screw it, let's just go out some more pickup food.

And last month, we only did that one time, but I think the bill was like $100. bucks we went to a nicer place with better quality food. And I've got two observations about that. One of them was I really appreciated it because we hadn't gone out to eat a lot. I'm like, well, this is really good. It was really good. Yeah, it was really good. So we appreciated it more than we did last year because it just gets mundane and the hedonic treadmill. You get used to it and then it's not special anymore. But the other thing I thought it's like a hundred bucks, we could easily eat for a week on that. If we tried, we could have 21 full meat. meals on that are less than $100, I think, if we really went frugal and ate a lot of vegetables

and that type of thing. So I don't know where to go from there, but I think the answer is to do things like that less often because it makes them more special and will be better with our money for having done so. So what do you think? Wow. So last month, I budgeted $100 for restaurants and we went, I think we spent $325 on restaurants. So this month, I've been, bumped it up to $2.50. Okay. But still, that's less, and it would be an improvement. It's a lot less than what we were spending last year.

But I do enjoy going out to dinner and grabbing lunch. We don't have a lot of time to talk just the two of us, even though you don't have a job, I have a job. We're home together during the day when the girls are at school, but I'm working at that same time. And then when the girls get home, it's just a whole lot of talking. and we don't seem to have a lot of time to connect. So having lunch out once a week is something that I look forward to.

Yeah, I do too. And one final thing I'll say about that is it's good not having expensive tastes. I think my jeans have a big rip there. I don't care. I'm wearing some junkie t-shirt. But I think the $5 taco box from Taco Bell is pretty great. I think this came up last time or maybe it was a different podcast. We went to like a Michelin star-rated restaurant in Chicago one time.

I'm like, this is really good. It was really good, but it was like $200. Oh, was it a Frontera grill. Yeah, which is excellent. Oh, great, Molle, really good food. But the thing about it is, is I think the... I enjoy Taco Bell just as much as Frontera Grill. I'm sorry for Tera Grill.

I wouldn't say just as much, but it's like 80% is good for 140th or 120th the price, 100 bucks per person versus $5. So $120th of price, 5% the price for like 80% of satisfaction. And no waiting, no making a reservation three months ahead of time, no pretentiousness, no feeling like you have to get dressed up. So yeah, shout out to the $5 taco box and the Mexican pizza's coming back to. This show is not sponsored by Taco Bell. I am.

But Taco Bell, if you would like to, email Mindy at BiggerPockets.com. I'm cheap too. I'll completely solve for a $5 taco box. $5 box. So as I have been posting about my misdeeds in my budget, people have been suggesting that this shouldn't be coming out of my budget. These unexpected expenses should be coming out of my emergency fund. Do you want to talk about the fact that we don't have an emergency fund? You mean how we don't keep a lot of cash on hand?

Well, we don't have... Or in the budget, we don't keep one. In the budget, we don't keep one. So in the budget, in the line items, I had slush fund. Because in my mind, we were going to just kill it with our budget. And all the extra money that we didn't spend was going to get flushed into the slush fund so that should we in the future have a month that didn't come in under budget, we could fund that through the slush fund. But then we blew it month one, and it looks like we're going to blow it month two, five minutes into it.

So we don't have an emergency fund. We have never felt like we needed an emergency fund because we can cover any emergency. But I also talk to people every day about their finances and recommend an emergency fund for people who cannot swing the emergency fund. or swing the emergency. So we don't have any emergency funds should we get one? I don't think so. And I'll back up and say I'm a very, very aggressive investor. We also have zero money whatsoever in bonds over the long term.

Studies show that being 100% in index funds will typically beat a portfolio with any bonds. So I prefer to do that. The other thing is we still have income coming in. So if we did have a fuller, furnace motor die or if I smack our Honda element into a curb, we can cover it and it's not going to destroy us. But if those things were concerned for you or us 15 years ago or 10 years ago, when it would have been, when it would have impacted us severely, then I think we should have had an emergency fund back then. It just were the place that we're at in life. I don't think we really

need one at this time. Well, even 10 years ago, I will. wasn't working, but you were, and we weren't spending all of your income. We've never spent all of your income. Yeah. Yeah. Emergency things are a tricky situation. I would say, thinking out and now, you should think of the most expensive thing that could go wrong with your house.

And off the top of my head, that's probably, at least here in Colorado, a new roof, which would probably be $12,000 for us. Think of your most expensive expense. If that would break you, then you better consider an emergency fund. But for us, we'd be okay. We could sell some assets. The risk is you have to sell them in a down environment like right now, actually. But yeah, it's a very personal thing.

Yeah, I would just go sell another house. Like, as a real estate agent, not sell my house, which generates more income. But, yeah, we are fortunate to, and we're not 30. We're not 25. We're not, you know, we've, we've been working for all of our adult lives. Some of us, some of us took time off to be stay-at-home moms. Yeah. Which is working in a different way.

But we've been savers our whole lives. We've been investors, our whole adult lives. So we have places to pull from that somebody who doesn't have the same history may not have available to them, which is why we don't have an emergency fund. I do feel that I need to address that because it is something that we just pull from our budget. Yeah, you talked about how I was a nerd. And one other thing was. I think about what?

I am a nerd. So I have lots of, we have lots of backup plans and lots of levels of redundancy in our life. For example, we have multiple cars and we barely need one. If one of them dies or if one of them got destroyed tomorrow, we'd be fine because we have another one. and we don't really need multiple cars. If anything breaks, I don't have much of a job. I'm under-employed, not unemployed. So I would just attempt to fix whatever happened by myself and save money that way.

So, yeah, I like to have backup plans for my backup plans. I think that's fair. Yeah. What's the next? Did we ever get to any goals for February? Yeah, I think we did pretty good. I think we should just keep trying to do pretty much the same thing. thing as we did, I should smash into less curbs.

And the furnace, which is right next to us over there in the room behind us or in front of us actually, furnace behave, don't pull any more of that. Yeah, definitely don't break while he's gone. Yeah. We'll be calling Bob again. Yeah, let's do the same thing, maybe going out to eat a little bit less, hitting less curbs, and yeah, yeah, pretty much it. Something that I am going to ask in the Facebook group and would,

like commentary from people is how do you account for expenses that are future expenses, but you know that you're going to be paying them? We've got a couple of different ways of doing it. We have property taxes, and I know what they're going to be. January, I accounted for property taxes based on last year's bill or two years ago's bill. And we just got the new bill. So I have updated that for February and beyond. And we're accounting for that in our expenses. We're not actually doing anything with that right now, with that money.

But we're allocating that in our budget. And then when the bill is due, we just pay it. I'm not going to mark that whole bill. as paid in the month that we pay it, it's allocated over the course of the year, because it's an all-year expense. We joined a gym. We paid for a three-month membership in January, but that's a January, February, March, gym membership.

So we spread it out over the course of three months. But the automotive repairs is something that's going to last us, I don't know, 400 months. I didn't allocate that out over 400 months. I allocated that for when we made the purchase. Same with, you can see in our budget, we've got the whole years worth of spending. March already has an expense. We are planning on a trip to visit some friends, and we purchased the ticket, the plane tickets in January, but we're allocating for them in March. So I'm not really sure how to work that.

I'm not an accountant, clearly, but personal finance is personal, and that's what works for us. So I mean, that works for you, right? That's what works for us, right? So I'm wondering how you handle your expenses like that. Do you handle it, do you allocate it for the month that you're paying it, even if it's a future month? like my travel in March, or do you allocate it over the course of several months like my gym membership? Everything's kind of just loosey-goosey.

And ultimately, I think as long as you are tracking your spending and, you know, figuring out where your money's going, that's what's most important. My spending tracker is courtesy of Mr. Waffles on Wednesday. I'm going to get him to make a video for us showing us exactly how to do that because I had him set up that whole spreadsheet. He's brilliant with it. He's like, oh, you want to do this and this? And he's clicking all around. And he's like, I didn't even know you could do all of those things.

So shout out to Google for making a lovely spreadsheet. Shout out to Mr. Waffles on Wednesday for actually doing all of the work for me. And you're nice too. Wow, thanks. I feel so special right now. shout out to you for filling out the forms. Yeah. Well, should we summarize?

We should summarize. You go first. Yeah. So we spent about 5,300, right? I should have looked at the spreadsheet before we talked. So we spent 5300, and I'd like to talk about that. On the surface, that sounds like a lot of money. A thousand dollars of that was due to my incident with a curb. So if I took that out, we'd be down to 4,300.

We choose to have a mortgage, which is a topic. for a whole other conversation that runs us about 1,300 a month. If we took that off, we would have had about $3,000 in core living expenses, which I think is pretty great. That comes out to 36,000 a year. We live in an expensive place, Boulder County, USA, which isn't cheap. But I think that's pretty good. Now, in future months, we're going to have higher expenses due to things like travel.

In addition to going to Seattle, we have a trip to Europe. in June, and that's going to cost a lot of money. We might spend $3,000 or $4,000 on that trip, but I'm okay with that. So the way I like to think about spending is we should keep our core expenses as efficient and as frugal as possible so we can allocate money to the fun stuff, but like the trip. And when thinking about it all, I just want everything to be thoughtful spending, whether it's food or a hotel in Germany, which is where we're going to. and France, Mindy has some fans in France, apparently.

I want everything to be thoughtful. And I never want to be cheap either. When we're staying with people, we always make it a point to take them out for a nice dinner or to do something really nice for them. But yeah, thoughtful spending would be how I want to summarize and how I want to live. That doesn't mean not spending a lot of money. It just means spending in a way that we've considered it and that we've appreciated the money and we haven't wasted it.

I think that's a really great way to phrase that. Thoughtful spending, conscious spending. It isn't about not spending any money. It's about not mindlessly spending because it's so easy to spend mindlessly. You walk into a store and swipe, swipe, swipe, swipe, swipe, swipe, swipe. And you walk out and you're like, you know, the next day, what did I even buy? Oh, I think I spent something yesterday and I didn't put it in the spending tracker. Uh-oh. Was it a toilet brush? Are you trying to hide? No, it was not a toilet brush, you big weirdo. Is there a support group for this? We might need to look one up.

Yeah, it's called everybody. Toiletbrush is anonymous, TBA? No, it's just about being conscious of where your money is going. And I think this is just something that is beneficial to people who, maybe have, what is it, I have more month left over at the end of my money. And I didn't make that up. Okay. I think that there's a lot of people who just don't realize that when the, like, this isn't

something that weighs on my mind all the time. I'm not always thinking about money, but I am more conscious of it now that I know that I am not only tracking my spending and having to share with you what I have purchased, but I am also spending money and tracking it publicly with everybody and having everybody say, oh, look at Mindy, she said she's going to spend this, but look, she's spending that. And nobody actually said that. But I don't want them to either. Thank you so much for joining us today.

We will talk to you again next month when we recap all of our hopeful successes, but probably failures too with our February spending. From episode 276 of the Bigger Pockets Money podcast, he is Carl Jensen and I am Mindy Jensen saying, may the force be with you. May the photons be with you. May the photons be with you.