I received an email not too long ago asking if I could write a blog post about how RD and I manage our household finances. As you may know, we keep our personal savings and retirement account separate and I’ll never blog about RD’s personal finances (so this post is really an incomplete picture of our overall financial management), but we do have joint accounts for managing our everyday spending. And that I can talk about. :)
Just a few notes about us if you’re new to this blog:
- We are in our mid-30’s with no debt other than our mortgage
- We make roughly the same amount of money
- This is obviously just what works for us, and is not necessarily going to work for every couple.
Before we combined our finances
When RD and I first moved in together, we kept our finances separate for the most part. RD would write out our monthly rent cheques, and we would put all of our joint expenses (groceries, household, travel, etc.) onto my credit card because of the rewards points. Then, at the end of every month, we’d reconcile all of our transactions, and one of us would transfer money to the other person depending on how the expenses came out that month. I liked it this way because I had a record of all of our everyday purchases so that I knew exactly how much we were spending. And RD liked this method because he wasn’t super interested in any of that information. :)
We kept our finances like this for the first 18 months we lived together. It was an easy system to work with, and also it gave us a sense of financial protection should our relationship not work out. Not that we were planning for the worst, but we both felt strongly about maintaining a level of financial independence, especially in a new relationship.
Related: We are home owners!
Creating our budget
When we decided to buy a condo together, that’s when we decided to open up a joint account for our shared expenses. I wanted to have a set amount of money that we deposited into this account bi-weekly – that would cover our mortgage, maintenance fees, property tax, insurance, groceries, household expenses, as well as a decent amount of buffer money that would also act as our joint household savings account. And because we had 18 months worth of data to draw from, I did what I do best, and created a spreadsheet. Ok, multiple spreadsheets. :) I averaged the last 18 months of our joint expenses, probable mortgage and housing costs, included a buffer, and came up with a magic number that we would each auto deposit into our joint account on payday.
Related: Why I don’t want to burn my mortgage
In the last 6 months, we’ve adjusted our magic number once – by just $20 – because our condo maintenance fees increased after our AGM, and we have another mouth to feed ever since we adopted our beautiful cat Zoey from the SPCA. :)
Who manages the money?
Me. This actually works out perfectly because you know I love budgeting and spreadsheets and numbers. Nothing makes me happier than burying my nose into a good spreadsheet or reconciling purchases and paying bills. It’s not because RD isn’t good at this type of stuff (he’s never had debt and he always pays his bills on time), but I like taking a more in depth look at our money. It was actually a huge step out of his comfort zone having me take on his part of our joint finances, and I appreciate that.
I also tend to take on any paperwork regarding our joint finances and negotiating any bills that need to be negotiated (like our internet), but only because I have a more traditional desk job and access to a phone on a more regular basis.
We do make sure to check in regularly with our finances, and he has access to our joint accounts so that he can see our balances and transactions whenever he wants.
Who spends the money?
Me, mostly. :) We have that joint credit card that he puts gas onto or if he buys anything for the home, but I do almost all of our joint household shopping for groceries, cleaning supplies, toiletries, pet stuff, etc. This falls into our division of chores, because I like shopping and comparing prices and products. I also feel a sense of satisfaction in having our pantry and linen closet stocked with essentials. I also pay our credit card balance every month, and any other random bills that might come in, but most of our household bills are automatically deducted from our joint account.
I’m curious – who manages and/or spends the money in your relationship, you or your partner?
This past weekend, I went home for the first time since February. It was really nice to catch up with friends and spend time with family. On the Saturday night a group of us went out for dinner and drinks. We’ve been friends for about 12 years, and were reminiscing about how different our lives are now. It was so interesting to hear my friends openly talk about personal finance – mortgages, savings accounts, and credit card rewards. These were things we would have never talked about even just a few years ago. And when we were in school? Even though they were my closest friends, I remember trying very hard to cover up my debt and what a financial disaster I was.
I can’t believe it’s been 10 years since we graduated from college – that means it’s been 10 years since I actively started taking care of my finances, and 9 years since I got myself out of debt. Looking back at who I was 10 years ago, I can barely recognize myself. I was a self-serving, arrogant, entitled brat who spent her way into $20k worth of debt. I’m proud of who I’ve become and how much I’ve matured, but I know there’s a lot more growing and learning to do on my part.
A couple weeks ago I went hiking with my blogger friend Cait. We were talking about (of course) blogging, and I mentioned that I don’t write on this blog as often as I used to. It’s not from lack of things to write about (my content calendar is full of blog ideas) – it’s the decision to prioritize my time doing other things instead. I’m also not as engaged on social media, but I try to be present and post things at least once every couple days. I’ve also been struggling with how much information to share on this blog. I know I shouldn’t have been surprised by this, but it recently came to my attention that a lot of my friends and family in real life do actually read this blog. I even know of vague acquaintances reading here, and while that’s amazing and I appreciate their support, I’m also very aware that my partner has no social media or blogging presence (and values his privacy). So I guess you could say I’m struggling with how much to share while I respect him and his desire for privacy.
Anyway, those are a few things that I’ve been thinking about lately. As for my finances? Things are running smoothly for the most part. Here are a few notables that have happened in the past month or so:
- Thanks to an increase in my RRSP contributions last year (and a decrease in my freelance income), my tax refund for 2015 comes out to around $520. I’m going to have to do some calculations for this year, but since I’ve already more than doubled my freelance income from last year, I’ll likely have to pay taxes when it comes to filing for 2016.
- We’ve been living together for over 6 months now, and things are going really well. We have really made this little place into a cozy little home, and I don’t think either of us want to leave once our 1-year lease is up. That being said, I am keeping a very close eye on the rental market in the neighbourhood. I’d love to live in a laneway with a balcony or some sort of private outdoor space, but for the price we’re paying compared to how much those cost, I think we’re okay for now (a 2-bedroom laneway with a balcony a few streets over is renting for $2,600 – that’s $950 more than our place!).
- Speaking of living together, we’ve come up with an okay system for splitting shared expenses. We take turns paying for groceries, and reconcile at the end of each month right before one person sends an Interac money transfer to the other person when rent is due. It works for now, but I’m slowly moving towards the idea of having a joined chequing account to streamline this process a bit more. Neither of us has had a joint account with a partner before, so it will take some talking to figure out if it’s the right move for us.
- My goal of only spending $500 on clothing/shoes for the year is dead. :( I had already bought new rock climbing shoes this year, so I ended up going over my $500 budget on the weekend when I bought a hoodie to replace one I bought 5 years ago (the cuffs were all frayed), as well as new workout tights (because I split the inner thigh seam on the ones I currently own – don’t ask). I’m actually okay spending the money because these are items I wear multiple times each week, so I wanted to make sure I was buying good quality items that were going to last me years to come.
- I’ve mentioned before, but freelancing has been going quite well this year. I’ve made over $20,000 in freelance income so far this year, and have saved most of what I’ve actually received in payments. This means my savings rate has gone through the roof, and I think I’m hovering at about a 65% net income savings rate. I’m extremely happy with this, but I’m going to have to take a really hard look at my short term vs. long term goals. Right now I don’t think I’m saving enough outside of my Retirement Portfolio. RD has a much larger down payment at his disposal, and if I toned down my retirement savings, I could save at a faster rate to try and match that (for when we do eventually buy – likely years from now). But since early retirement is my number one financial goal, I’m not sure I want to do that. Some thinking has to be done.
Anyway, that’s it from me over the past couple weeks. :) I’m making it my goal for this week to wrap up a few unfinished blog posts that I’ve been working on over the last month, so be sure to look for those. In the meantime, it’s a short 3-day work week for me, as I’ll be headed to the Sunshine Coast on Friday morning for a camping adventure with Cait. :)
Wow, I can’t believe it’s been weeks since I last wrote here. It’s been a nutty, stressful month at work – lots of overtime, and surprisingly a lot of freelance opportunities have also come up. But aside from work, any free time I’ve had has been spent enjoying the outdoors and with friends and family. Here’s a quick update on the happenings around here:
I’m currently writing this post from Tofino while RD surfs and I rest my tired running legs. I haven’t been here since 2011, and can’t believe how much fun the trip has been so far. It helps that RD and I had the same sort of vacation in mind – to be outside and active as much as possible.
Thursday night we took the ferry to Vancouver Island and drove straight to Tofino, arriving pretty late at night. It was a crappy drive, but waking up Friday morning already in Tofino was pretty great. RD went out for a morning surf, and I did a slow 8.5km run on Chesterman Beach. In the afternoon, we went on a couple long walks – one to Schooner’s Cove, and the other on Chesterman. By the end of the night, my legs had covered 21km of ground. :)
Saturday morning started out much like Friday – RD went out surfing, and I went for a 9.5km run on the beach. After that, we headed into town to run a few errands, explored Tonquin Park, and then met up with my friends for a walk on the beach and then dinner at a pub on the pier. My daily output was 18km of running and walking.
Sunday morning (today) we drove down to Ucluelet to tackle the Wild Pacific Trail. I didn’t realize it was rated Trip Advisor’s #3 attraction on Vancouver Island, but the views were pretty stunning. :) The round trip hike was just 9km of easy hiking, but I really enjoyed it. Tonight we plan on hitting up Tacofino, and will try to catch the sunset at Chesterman Beach. Tomorrow we’ll be packing up and visiting my uncle in Nanaimo before heading to Powell River to visit with RD’s friends and his grandma for 2 or 3 nights. Hope your Easter long weekend has been filled with fresh air and family! :)
Freelancing has been going well. I banked $4,350 in freelance income so far this month, with another $700 to be paid out in the next week. I’ve also secured a couple more contracts for next month, which should bring in about $3,000. I’m really pleased with securing both repeat clients as well as attracting new companies I’ve never worked with before. :)
As for my full-time job, I received a small 2.5% raise last week. It’s not much, but nice to see a little boost to my salary. In terms of workload, it’s been busy. A major person in our marketing team moved across the country and is now part of the eastern team – so our little group has to absorb her workload for a while until we can determine if/when we need to replace her. That has resulted in overtime every day for me, but the good news about that is I’m banking more hours (which means more vacation time).
- I’ve been indoor climbing 3x/week lately, and it has been really fun. We’ve been making progress up to 5.10d and 5.11a routes… although RD will be gone for an entire month for work starting in May, so I suspect our progress will be severely stunted. :)
- We are planning an epic road trip for October. We have both individually wanted to travel north for years, and with the dollar keeping our vacations within Canada this year, it seems like the perfect time to go. So we’ll likely be taking 3 weeks in October, loading up my car, and heading north. I’m very excited to hike and explore the Northern BC and Yukon area. If you’re from the north or if you’ve traveled there, I’ll be calling on you for travel tips and suggestions, as I’ve not been farther north than Dawson Creek!
- As a side expense to this road trip, I’ll finally need to invest in new tires for my car (and maybe a full-sized spare one for the trip) = $$$
I have so many blog post ideas (seriously, you should see how many drafts I have lined up here), and I can’t wait to start writing them and getting back into a blogging routine. :)