2016-Oct YTD Financial Update

I have a confession to make.  I hate working on our finances.  Well, “hate” might be too strong of a word, but I reeeeeeally don’t like doing the monthly process I’ve built.

I especially don’t like balancing our actual expenses to what is on our bank statements.  I use Quicken, so 90% of the time it’s really easy.  But there is 10% of the time where it doesn’t reconcile and I have to spend 2-3 hours figuring it out.

Well, I procrastinated about it for the past few months and finally did it.  And here are the results.

Income Statement (as of Oct 31, 2016 YTD)

  • Income
    • I’m about 0.86% off from the W2 income I budgeted.  So, that’s good validation of my budgeting assumptions.
    • But total income is about 3% less than budget.  Mostly because my bonus came in way less (~40%) than expected.  Fingers crossed that it goes the other way next year.  But that also resulted in a lower tax and tithing expense.
  • Expenses
    • YTD we’re about 0.70% less than budgeted but I’m projecting that we’ll be a about 2.3% less than budget by year end.  Mostly due to an error I found by which we have been tithing more than 10%.  Closer to 15%.
    • The lower expenses are due to
      • I budgeted for $100/mo for home repair and we’ve been fine with $50/mo.
      • Our mortgage payment dropped because the servicing company had been over funding the escrow account.  Sounds like a monopoly card.
      • On the other end of the spectrum groceries have come in a fair amount higher due to more children and one being a baby.  Baby food is expensive.
      • Recreation expense is coming in slightly higher than expected.  But that’s due to swimming lessons.
    • All in all, our budgeting has been pretty dead on so far this year other than those categories I mentioned.
  • Operating Income
    • YTD operating margin has been 49.99% versus budget of 51.66%.  Our goal is to be at about 50%, so we’re doing a little worse than expected but in-line with our overall objective.  I’m projecting that for the full year this will come in at a little less than 51%.
    • Note that this is better than last year where we finished at 48.6%.  As our income goes up and we control expenses, this percentage should increase.  Unfortunately, with kids in school, it’s been hard to control expenses.

Balance Sheet

  • Assets
    • Total Assets are flat from the last month, but up 19.2% over last year.
    • Cash balance is pretty flat.  We have our long-term emergency fund, short term emergency fund and our “buckets account”.  And that makes up the bulk of it.
    • Investments are down 1.2% for the month, but 25% over last year.  Note that includes contributes and returns.
    • House and cars stay flat because I don’t adjust them except for once per year.
  • Liabilities
    • Total liabilities are down 15% over this time last year.
    • Student loan is down 50% from this time last year.
    • Mortgage is down 2.6% from last year.  Argh.
  • Net Assets
    • Up 37.3% YoY
    • Another measure, which I call True Net Assets (which excludes house and college accounts) is up 34.6%.
  • Asset allocation
    • 19% – Investments
    • 6% – Cash
    • 54.4% – House Equity
    • 17.8% – Rental Equity
    • 2.7% – Cars



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