Finances: 2014 Debacle; 2015 Budget

I just reviewed the shambles that is my 2014 finances, by way of designing a new budget for 2015.

My God. Things were going to Hell on a skateboard, that much was obvious. Last year I gave up tracking every teensy little expenditure in Excel. That hair-tearing task was making me crazy. Result: I knew a lot of extraordinary expenses were happening, but I had no idea how HUGE those expenses were.

Nor did I realize how overbudgeted I was (luckily) for 2014. Last January I drew down $13,000 from savings and then broke even on December 31. But absent the brain-banging number and size of unplanned expenses, I really would have needed only about $3300 from savings.

Between the recurring urinary tract infections and the outrageous amount I was charged to spay her, Ruby’s first year casa mia cost me $2,726.51.

I got ripped off several times by household repair providers: by a plumbing company, an air-conditioning company, and a pool company. If you live in the Phoenix area, I suggest you avoid Lawson Family Plumbing, Premier Air Conditioning, and Love Pools. The total gouge there came to about $500.

Uncharacteristically, this year I decided to make some charitable contributions. That figure, which would normally be close to nil,  came to $764.48. This would have been fine if it hadn’t been for all the OTHER outrageous costs, which included $680 for tree trimming (which needs to be done again, in a big way), $600 for eyewear, another $385 to the Mayo, and about $2500 for a table I figured I could afford.

In fact, I could afford the table handily…under normal conditions. But 2014 was far from normal! I was getting hammered from all directions. All told, total extraordinary expenses came to $9723.26!

This year I have to get a grip on expenses, so it’s back to the month-by-month expense tracking drudgery. I can hold the ordinary discretionary expenses down, but I can’t imagine what I’m supposed to do about things over which I have no control. Obviously, I didn’t need to buy the table, nor did I need to buy a puppy. And I certainly don’t need to contribute money to the church, considering that I have no credible source of income other than raiding savings.

On the other hand, I had no way of predicting that Ruby would get sick….again and again and again. I can’t do without functioning glasses — I couldn’t see to drive through the pair I had. The cancer scare was not something that came to me by choice. It was a good thing I had the trees thinned before last summer’s windstorm roared through here and ripped down trees all over the ’hood. Keeping the car running wasn’t cheap, but repairs and maintenance were a damn sight cheaper than 30 grand for a new Sienna.

In 2015 we are not drawing down from investments until December, when I’ll be forced by federal law to take money out of the big IRA. With any luck, though, most of that will simply be rolled into the taxable Fidelity account and reinvested. I had a cushion of $11,000 in the bank, and, since I broke even on last January’s drawdown, that amount remains intact. We’re hoping I can make it through to the end of 2014 on that plus teaching income plus Social Security. And if somehow I manage to dodge the hammer this year, that may happen.

Based on 2014 figures, average monthly nondiscretionary costs come to about $657. That’s counting the housekeeper and the lawn guy as fixed monthly expenses.

I allow about $1200 for monthly discretionary spending, which includes everything from groceries and dog food to those nasty surprise expenses. Sometimes I can keep it to under $1100, but not often.

Total net funds available to cover living expenses in 2015 come to $30,269, after taxes & insurance are paid. The resulting budget looks like this:

I think that’s highly optimistic, because you can be sure at least some unplanned expenses will come along to clean out those apparently left-over funds. For one thing, I’d be very surprised if a thousand dollars will suffice to keep the dog chariot running this year.

I’ve decided, by the way, to keep the Dog Chariot for another 20,000 miles, if it can be made to operate that long. In 2015 I’ll need to keep careful tabs on business vs personal mileage. There’s an outside chance that, what with the SBA meetings and the junkets to meet clients and subcontractors, I might be putting half or more of my mileage on business trips.

AND there’s a far outside chance that I can sell the boob book to a real publisher. If that happens, I’ll get an advance of something between $15,000 and $30,000, which will go into the S-corp. And if that happens (note the extravagant number of ifs we’re working with here!), then I could justify having the S-corp buy the new car and running its operating costs through the business.

In the far more likely scenario — none of those ifs comes to pass — then at least I will have put off disbursing 30 grand for another year or so.

Seventy-nine hundred dollah seems to me like a wildly extravagant budget for extraordinary expenses. I’ve never spent this kind of money on side disasters before. Horrible, horrible experience!

If things settle back down to normal, that $7950 (or whatever’s left of it) will go a long way toward supporting me in 2016.

Hope springs eternal, hm?