I am a little behind schedule on this post but here is my analysis of my monthly income and expenses for January 2019. As per usual, below I have listed a running three month look for comparative purposes.
First, here are the numbers:
|Category:||Nov 2018||Dec 2018||Jan 2019|
|Total Monthly Gross Pay:||100%||100%||100%|
|Diverted to Investments Account:||4.92%||27.14%||36.2%|
|Diverted to Savings Account:||0%||24.34%||0%|
So, looking at this month’s numbers, there are a few things for discussion. First are the taxes withheld jumping from the previous month. This is due to the fact that the calendar turned to a new year and therefore, I must contribute to Social Security withholdings once again. This contribution has a maximum value per year and once you hit that, money is no longer diverted to this fund for the remainder of the year. Late last year I hit that limit and therefore in December I did not have these monies removed from my paycheck.
Also, of note is the jump of 401K withholdings. Once again, last year I was able to max out my 401K contribution. This occurred in early November. That can be seen by looking at this line above. In November I had a small contribution that topped of that contribution for the year and then in December there were no contributions. Now that we are into a new year, those contributions start back up again. At present I am contributing 12%, but I will look for opportunity to increase this in small increments any time that I think I can do so without impacting my monthly budget.
Lastly, I was able to divert quite a bit to investments this past month. I have regular automated contributions that are scheduled to occur on the same day as I receive my paycheck. I was contributing $525 per pay period to start December but by the time of the second period, I had moved that up to $550. I will continue to look for opportunities to increase this amount anytime I can permanently eliminate a recurring expense to ensure that I can lock in those savings for the long term. In addition to my regular automated contributions, I found I had more cash in my checking account than I needed for my regular budgeted expenses. I took advantage of this by diverting that additional money to my taxable investment account. I am working on creating a more comprehensive budget and once I get to that, this type of situation will be eliminated since my plan is to use a zero-sum budget where every dollar is accounted for. At present, while I do “budget” for most of my monthly expenses, I still feel that I am mostly reactive and increase payments to savings or investing vehicles based on the balance in my checking account. In the future I plan to be much more deliberate to ensure that I can capture all savings and ensure that each dollar is put to the best use.