This month I was a little late posting our budget and investment income. Hopefully, I'll post this update a lot sooner than the 15th of the month.
Each month, I’ll be posting our budget as well as the income we receive from our investments. Investment income includes dividends, interest, and rent payments(if any). This has to be one of the toughest aspects of being financially transparent. It shows whether we really practice what we preach about being faithful stewards, or if we are squandering the resources God has given us. It’s a little frightening to be honest, and can be a little disheartening. Being put under a microscope is never easy, especially if you think you’re the one holding the microscope. The truth is, God already knows whether we have been good stewards or haven’t, and His grace can even forgive our lack of stewardship. It also helps to keep us in check, as far as keeping our expenses low since we will be posting how much we spend each month, but it also helps us remember a couple of things:
1. Everything we have is the Lord’s, and he has graciously given us the abilities we have to earn and be good stewards.
2. Our identity isn’t found in our possessions or lack of possessions, so we shouldn’t be afraid of posting either.
3. Our motivation isn’t to boast, and yes, it is possible to boast about not having or shunning possessions. Since everything we posses is only “ours” for a time, the stewardship of what we have is what’s most important. Our faithful stewardship is still attributed to God, because He is the one molding us, strengthening us, and our faithfulness is a gift from him anyway! All the glory belongs to him from start to finish.
Ok let’s get started:
November was a big improvement for many reasons. At this time, I’m currently transitioning from one job to another, so our income was significantly lower than it would normally be. For the first time since this transition, our budgeted expenses were below our income. This means that our (budgeted) expenses are falling below our income, and if we can stick to our budget, we would be able to save/invest/give even more generously once my transition is complete. We spent just $40 more than our total income, a HUGE improvement. Although our income wasn’t high, we had some left over savings that we used to cover our expenses. Hopefully we won’t have to withdraw from our savings account in order to cover our budget in the future, now that our expenses have fallen. Last month we were under budget by $564 and spent $4557. This month we spent $4,079 and were under our budget by $366. Last month, I was pretty upset about the lack of generosity in our giving. This month, we were a little bit more generous, but there is still room for improvement. I'm starting to see how posting our progress online has helped us improve our financial health in so many way. We've got a long way to go, and we definitely need to be more generous, but it's exciting to see the upward trend.
We didn't pay down as much debt as I thought we would. In the next couple of months we'll be focusing on decreasing our debt in order to help us be more financially secure.
Now that we’ve got the painful and hard part out of the way, let’s look at our investment income as well as our savings rate. Our long term goal is to have enough income from our investments so that we can both quit our jobs and use our time more wisely and with more purpose than simply collecting a paycheck. Not saying that work is wrong, or that being an employee is unfruitful, we would just rather use our time in other ways. In order to get to that point, we need to save. Increasing our savings rate will increase the amount we can use to invest which will increase our investment income.
For the month of November, our investment income was(DRUMROLL PLEASE)…
Which isn’t much now, but since this portion of our portfolio is $3,074, our annualized return is 12.6%, which is not bad. 97% of the income came from interest in our lending club account, so we will definitely keep adding to that account as well as our dividend portfolio. The price of the stocks in our dividend portfolio declined, resulting in a 1.92% decline, but we don’t plan on selling these stocks so this isn’t too big of a deal as long as we can keep collecting the dividend checks.
We also bought The Lion's Fixed Income motif (purple in the portfolio analysis). We bought this motif to increase our monthly passive income, and will be adding money to this motif and to The Lion's Share's motif (in green). You can invest in these motifs as well by opening a Motif account and investing in one of the portfolios to the right of the screen.
Our savings rate this month was a little lower this month at 16.4%, from last month’s rate of 17.5%. This is the amount we deposit into our retirement, emergency fund, savings, and investment accounts. This is different from the amount of money that is carried over into the next month. These are deliberate deposits into these accounts in order to plan for future events. Debt has been a major hindrance to our ability to save, as well as poor budget management and stewardship, but we are growing, learning and improving. This month was a bad combination of lower debt payments and lower saving. Although we were able to improve our net worth, we need to make sure we aren't just increasing our asset base. We need to also decrease our liabilities. This was such a difficult task, but I do think it can continue to be very fruitful. Hopefully next month we continue to be better stewards of what God has given us. I hope that you’ll be challenged to do the same!