Despite the 6% decrease in my net worth in October, my income and expenses were healthy. My income was at my expected level for both my salary and “extracurricular” income. October’s expenses were a little higher than expected, but still within an acceptable range.
Each month, to accompany my balance sheet, I publish my income and expense report to keep myself motivated to make decent decisions about the management of my money. I’ve done a good job of using Consumerism Commentary to hold myself accountable. As my income increased, however, I’ve allowed myself more leeway while continuing to spend less than I earn.
To see my progress, continue reading this post. Click on the thumbnail for a larger version of the income statement.
My salary and benefits consist of the paycheck I receive from my day job as well as my 401(k) matching contributions. 25% of my paycheck is invested in my 401(k) and starting in November, the percentage will increase to 50%. I will not max out my contribution this year, but I will next year after adjusting my percentage again. Also, 10% of my paycheck is diverted to my company stock purchase plan, which lately has not seemed like the benefit it once was due to the lackluster performance of my company’s stock.
The “Other Earned Income” category lists the income I receive from other activities such as writing online. At this point, I’m able to determine that changing my policy earlier this year to not accept text link advertising on this website has set my income back about one year. I mentioned last month that I am still considering leaving my day job to pursue my other interests full-time. The latest analysis claims that next year will be tough for those who earn money through advertising, so I’m going to continue taking a cautious approach.
Although I was able to save money on food and groceries last month, my expenses this month seem to have made up at least part of the difference. The recent decrease in gas prices is also helping to ease my expenses. My utilities expense was higher in October because my September electricity bill ($125) was paid in October as well as my October electricity bill ($90).
This month, I initiated a sustainable membership with WNYC, a public radio station affiliated with National Public Radio. I listen to the station during my commute in the morning and the afternoon. Each month, $10 will be deducted from my credit card (paid off every month, of course), and included in the “Charitable Contibutions” category. WNYC is a large organization with an operating budget amounting to millions of dollars. Usually, I like my charitable contributions to make more of a difference for the organization, but I’m continuing to re-think my strategy for giving.
Every year, I travel to visit family on the west coast over Thanksgiving. I purchased tickets for my cross-country round-trip flight last week, finding a decent deal on JetBlue. I decided to pay an extra $60 to reserve seats with extra space on both ends of the vacation.
Expectations for November
I expect a decrease in my outside income in November and going forward, but I might make up for the coming month’s difference thanks to freelance writing for a major magazine. I should manage to also decrease my expenses in November. Stock market performance, with the largest effect on my net worth, is a primary concern, but I need to spend more time focusing on decreasing my expenses and increasing my income.
In November I plan to experiment with a cash-only payment option. Where possible, I plan to use only cash rather than credit cards to see if the change has an effect on my level of spending. This is will be somewhat difficult when I purchase gas for my car; I’ll need to make sure I withdraw enough from the ATM. This will also limit my ability to purchase items online, which is unfortunate due to Amazon.com‘s low prices when compared to local stores at which I usually browse. It will be an interesting experiment.
Updated September 16, 2009 and originally published November 3, 2008.