balancing income vs expenditure.... how do you do it?

[drcolleen]

Perhaps this is not "women" issues but I think the mom guilt is certainly a factor for me.

- How do you balance your retirement/education savings, cost savings to your budget and spending for your family's today happiness?  Small example, I want to cut back on expenses like TV but if I lower my package further we lose Disney and Nickalodeon (we're already below the Jrs) and I can't do that to my stay at home most of the time husband.  Large example, we just had #4 and realized how hard it will be to travel (live rural, 6 plane tickets $$, we don't fit in a hotel room legally) so we bought a travel trailer RV despite having mortgage debt.

 

[conniebird]

I do not have a family yet- but I was told to take care of you and your spouse first - so max out those retirement plans, save accordingly etc. If you have that handled, then the rest is "discretionary". Difficult to comment without more specifics about your situation.

[RocDoc]

drcolleen wrote:

Perhaps this is not “women” issues but I think the mom guilt is certainly a factor for me.

– How do you balance your retirement/education savings, cost savings to your budget and spending for your family’s today happiness?  Small example, I want to cut back on expenses like TV but if I lower my package further we lose Disney and Nickalodeon (we’re already below the Jrs) and I can’t do that to my stay at home most of the time husband.  Large example, we just had #4 and realized how hard it will be to travel (live rural, 6 plane tickets $$, we don’t fit in a hotel room legally) so we bought a travel trailer RV despite having mortgage debt.

 

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conniebird wrote:

I do not have a family yet- but I was told to take care of you and your spouse first – so max out those retirement plans, save accordingly etc. If you have that handled, then the rest is “discretionary”. Difficult to comment without more specifics about your situation.

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I agree with conniebird. Most of the retirement blogs mention to make you self and spouse the priority. They often mention that "your children can get student loans but you and your spouse can't get loans for retirement."

[Hatton]

Fund your retirement first. Then you save for your kids education.  I think we all get upset with expenses like ever escalating cable and cell phone bills.  I personally try to make myself call to renegotiate stuff like cable bills once a year or so.  I hate doing it but otherwise they take advantage of you.

[Quan]

I agree with recommendations to fund your retirement first.  My wife and I have 3 kids under 4yo.  Our kids don't watch much TV at home except for 30 minutes on Saturday and Sunday.  Between video rentals at the library, Netflix subscription, youtube, and Amazon Prime we have more than enough shows to keep our kids entertained.  This likely depends on how much TV your kids watch.

Otherwise, most of our travel has been places that have been drivable.  House rentals like AirBNB and VRBO have housing a family of 5+ easier since you don't need squish everyone into a single hotel room.  Also having all the home amenities (fridge, stove, oven, and washer and dryer) makes it easy to save on meals as well as nothing having to pack so much for each kid.

[drcolleen]

Particulars- I'm 35, an employee so I max my 401k, do a backdoor roth, send a few hundred into a random mutual fund each month, fund daycare with pre-tax money (3 kids will go only 2-3 days/week and we pay hourly so it's not bad) and fund the 529s x4 only the $8k that is tax deductible in my home state.  Husband is on a semester by semester contract so no retirement plan.  Our only debts are 3 mortgages ($85k, $124k, $370k, only the last is tax deductible) and for the RV ($32k, interest is tax deductible as second home).  We've got a ~$250k in tax advantaged retirement savings, ~$75k liquid, $45k in taxable investments.  I know we should fund 529s in a different state to reduce tax burden in that state, I want to pay off the rental houses mortgages, I know I should put more away in after tax funds..... but I guess we all have excuses on why we spend our money instead of saving.

[Zaphod]

drcolleen wrote:

Particulars- I’m 35, an employee so I max my 401k, do a backdoor roth, send a few hundred into a random mutual fund each month, fund daycare with pre-tax money (3 kids will go only 2-3 days/week and we pay hourly so it’s not bad) and fund the 529s x4 only the $8k that is tax deductible in my home state.  Husband is on a semester by semester contract so no retirement plan.  Our only debts are 3 mortgages ($85k, $124k, $370k, only the last is tax deductible) and for the RV ($32k, interest is tax deductible as second home).  We’ve got a ~$250k in tax advantaged retirement savings, ~$75k liquid, $45k in taxable investments.  I know we should fund 529s in a different state to reduce tax burden in that state, I want to pay off the rental houses mortgages, I know I should put more away in after tax funds….. but I guess we all have excuses on why we spend our money instead of saving.

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You're doing pretty well and young, as well as being fairly diversified with a buffer. Just keep plugging away towards your goals. I dont think dropping the disney channel is going to make a significant difference to your retirement lifestyle, nor a latte or three. Pick the things you enjoy, keep them and increase your use of those things. Find the things around that you have but may not enjoy, cut them out or stop contributing time/money to them.

[DMFA]

I think it was Buddha that said the elimination of desires is the key to life...?

[Hatton]

I think you are doing fine.  For a large family the RV makes sense.

[jfoxcpacfp]

drcolleen wrote:

Our only debts are 3 mortgages ($85k, $124k, $370k, only the last is tax deductible) and for the RV ($32k, interest is tax deductible as second home).

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Just curious - why aren't the 1st 2 mortgages tax deductible?

As to your original topic, I think what you intuitively realize is missing is a cohesive financial plan so that you can see how all of your various puzzle pieces fit together. Difficult to know how small and large decisions affect your long-term goals without one. If you want to continue to DIY, The One Page Financial Plan by Carl Richards is a good place to start.

[drcolleen]

They are houses we are renting out (in 2 different states separate from where we live) and we had been taking a negative income from them but this past year we went above the income level to write off the loss.  Does this sound wrong?

[RogueDadMD]

I have 2 kids who while not addicted to TV do enjoy their kids cartoons.  We cut satellite out when we moved houses a month ago. However I am using the Dish network login credentials of a family member (who will probably never cut their package), thus we have access to Disney Jr, Nick Jr, etc via my my Roku.  My kids could care less about the live channels -- we always just DVR'd several episodes of their favorite shows and that's all they ever watched from satellite.

We have been paying for Netflix for years as well as Amazon Prime (for shipping purposes primarily, we rarely watch shows from it).  We recently added Hulu for a single specific show my wife wanted.  However with Hulu comes a lot of the shows we used to DVR from satellite.  Now I've added digital antennas to the TVs,  so having a satellite package was overkill.  I'm a sports junky but am using my family members Dish credentials for ESPN, Fox Sports, etc.  Also I echo someone else who mentioned that Youtube has a ton of free stuff as well.

Plenty of kids content to go around without a full cable/satellite package if that's your only motivation for keeping it -- that's the easiest and cheapest stuff to find elsewhere.  Also you'll find that if you just tell the kids that their show is gone but you have some cool new ones for them they will be fine.  It's possible one of them could have a brief tantrum, then they move on like they always do.

[jfoxcpacfp]

drcolleen wrote:

They are houses we are renting out (in 2 different states separate from where we live) and we had been taking a negative income from them but this past year we went above the income level to write off the loss.  Does this sound wrong?

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The interest is deductible but is suspended as a PAL (Passive Activity Loss). In the year you sell each property, all suspended losses will be deductible. In the meantime, in years you show a profit, you can write off enough expenses to break even on the property and unused expenses will be carried forward with the rest of your PAL.

[Hatton]

Are you an accidental landlord like WCI or did you purchase properties in different states to be a real estate magnate?

[drcolleen]

hatton1 wrote:

Are you an accidental landlord like WCI or did you purchase properties in different states to be a real estate magnate?

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Accidental, one house outside Ft. Benning where I did residency and a second outside Ft. Leonard Wood.  We had dogs (including a pit bull) then dogs with kids so renting seemed difficult but would have been smarter.  We have a management company for each (at a 10% fee of course).  One day we'll sell though I'm not sure when, the Ft. Benning one always gets a new renter before the old is moved out so we'd take a loss if it sat on the market for 2-3 months to sell vs just keeping going gambling for a big repair bill.