Salary and saving moning

[Palmtree]

I would like someone help me to understand many things about my husband' salary.
First, I would like to say that English is not my first language and I still learning it, so please sorry for my spelling mistakes.
My husband gets 130.000 per year, He is an enginner.We have a 8 years old child. We do not save any money at all, these worry me,however, we are so frugal people.
He said that we spend too much, but I do not know where because we do not have vacations, we spent for food $150 per week, we eat out once a week, he give me $300 dollars per month to pay for my clothes, haircut, everything except medical bills.
We have pay $ 2,000 per month to the bank for the morgue. We do not pay for cars. He says that he save just the 2% of his salary for his retirement.

I am asking this because I need some dental treatment $3.000 and he says that we can pay it but it would be very difficult because we are saving anything.

I am a professional as well as him, but I have been taking care of my child, now it is time for me to come back to work out of home.

I want to be fair with my husband, and I do not want to spend money. Is it possible that 130.000 os not enough salary to save money?

Please, my question, is it possible not to save money even though the income is 130000 dollars per year?

Thansk in advance.

[jpg7n16]

Well, it's possible, but not advised. And in your case, you can easily save money. I can virtually guarantee your family is overspending.

Your only expenses are not food and housing, there are many more expenses than just that. Would you be able to post a complete monthly budget, please?

Please include the following:
-Monthly salary after taxes (what amount is deposited to your bank account each month)
-All monthly expenses
-Balances and rates of any debts owed ( ie. mortgage $212,000 owed @ 3.75%, etc.)
-A short listing of major assets (current market value of house, value of any cars, total amount in retirement accounts, etc.)

[DebtFree&Broke]

You need to ask your husband to teach you about your family's budget. You need to know about everything jpg posted. As a couple you should be planning how you spend and save the money. Talk to your husband today. We are trying to save $200 a month on $47000 a year, so you should have no problem saving money on $130,000.

[disneysteve]

Welcome.

There is clearly a problem here and the two of you need to sit down together and figure out where the money is going. My wife and I (and our 16-year-old daughter) earn just about the same amount as you. We currently save and invest 25% of our gross annual income. There is no excuse, other than overspending, to explain you only saving 2% of yours.

You say that you are frugal, but the numbers you've provided say otherwise. You need to look at your budget and identify where every dollar is going. If it isn't going to savings, it has to be going to spending.

[FPipitone]

I am of the opinion that everyone can (and should) save 10% of their gross income and invest it/put it towards retirement.

The financial scenario you describe simply does not add up. As others already said, you need to sit down with your husband and get informed on where the money is truly going. With that salary and the expenses you describe, 2% for retirement is just unacceptable.

You and your husband need to communicate and work out these financial issues. I'm not sure anyone can give you advice on this. This sounds like a marital issue rather than a financial one. Good luck.

[Palmtree]

monthly budget

Thanks to all for your interest. I am the husband of Palmtree. Here are our monthly net income and expenses. The difference is $18,312 / yr
but we are not saving anything. A few times a year we might experience a few unexpected
expenses (appliance breakdown/replacement, larger car repairs, etc) but nowhere near $18k.
I don't know what I am missing.

Net income: $7500 per month

Expenses (per month):

Mortgage (PI&T&Haz): $2,242
Utilities (gas/elec): $275
Cable/Internet: $166
LL voip phone: $25
cell phones: $63
Car Insurance: $161
Supermarket: $736
gas for 2 cars: $275
ADT alarm: $44
YMCA membership: $64
eating out/rest: $350
BJ's wholesale: $140
misc insurance: $67
piano lessons: $83
birthdays +
holidays +
misc. gifts: $325
car maintenance: $83 (avg)
support for inlaw: $200
wife allowance: $300
husband allowance: $300
House maintenance: $75
------------------------
Total expenses: $5,974/mo

[mcsmith76]

Palmtree and Husband,

My wife and I are earning a very similar net salary of $7,600 from a gross of $12,600 and we are saving a significant amount of our monthly net salary (about 4,500). From examining your expenses compared to ours, I will offer my perspective on some things that you may want to consider in your effort to save more money and achieve financial peace of mind.

1. Your home is costing you a significant amount of money compared to your income.
2. Your food costs are considerably high.
3. You like to give a lot, maybe even too much for now.
4. Your car(s) seem to be a problem.
5. I am not sure what you are giving each of yourselves a $300 allowance for.

That said, the biggest problem is that you do not understand your expenses as well as you should, thus the reason why you do not know where the $18,312/yr is going. These unexpected expenses are one major reason you are not saving. This leads me to believe the current estimated expenses you listed are either low or not entirely followed.

We currently allocate two types of expenses:
1) fixed expenses (mortgage/rent, insurance, utilities, etc.), and
2) discretionary expenses (food, lessons, entertainment, gifts, etc.).

You may want to consider splitting your expenses in these two categories and then drill down into subcategories from here. If you use a spreadsheet to do this it works great as long as you are honest with your discretionary expenses. The fixed expenses are easy to list because they do not change each month. My feeling is that you could cut back on a few fixed expenses, but that it is your discretionary expenses that are really hurting you. Still, without knowing where the other monthly expenses are going (likely discretionary expenses) it is difficult for me to assess any further.

[sblatner]

I would suggest that you write down everything you spend in a month - both of you honestly. It is easy to spend cash and not know where it is going. Or, if you don't carry credit card balances, charge everything and then all your expenses are on the credit card statements. I use Quicken. A lot of people like Mint.com. It is difficult to fix spending habits if you truly don't know where the money is going.

I keep track of every penny we spend. This is especially valuable when there are kids involved. Our kids are teenagers and it seems like they are always asking for money for various activities at school, etc.

[jpg7n16]

I would honestly recommend a program like YouNeedABudget or www.mint.com if you don't want to create your own spreadsheet to track.

These programs can help you monitor all expenses big and small to find out where every dollar is going.


There's no way you should be going through life with $18,000 of unknown expenses/year. That is 20% of your take home pay. So a fifth of your money is vanishing, and you don't know where it's going. That's kind of a big deal.

A simple budgeting program could solve that issue for you.

[disneysteve]

I don't know what I am missing.

The cure for that is paper and pencil. Each of you needs to write down every penny you spend on absolutely anything for 30 days. At the end of that period, sit down and see where the money really went. $18,000/year is $1,500/month or $50/day that you can't account for. That's a lot of money going missing every month.

As for your budget, there is a lot of room for improvement. Your food costs are extremely high. You are spending over $1,200/month on supermarkets, restaurants and BJs. I realize some of that may be on non-food items like paper goods and such but still, that number is crazy high.

What costs are covered by the personal allowances? That number probably can be trimmed. Your cable bill could be lower. Do you really watch all of those channels that you pay for?

[Eleanor]

Since everyone else is talking about the income-vs-spending aspect and the major expenses, I'll put in my two cents about the more minor issues. I think you could pretty easily reduce your eating out budget and your grocery budget. Eating out only once a week can make a big difference. Try to plan your meals more efficiently to reduce your grocery budget, every little bit will add up quickly.

Also, this is a small expense but do you need a home phone if you all have cell phones? Also, do you need to spend so much on cable? Unless you watch a lot of shows on specialty channels you can definitely reduce your cable bill or just cancel cable altogether. Consider going the Netflix or Hulu route.

[LivingAlmostLarge]

Your budget is incomplete. why are you only netting $7500 from $12.6? and really only saving 2% of the 40% gone?

[Banimal]

Your budget is incomplete. why are you only netting $7500 from $12.6? and really only saving 2% of the 40% gone?

Actually making 130k a year gets you 10.8k a month. 7500 is reasonable. Which is around ~30% worth of taxes which seems about right for federal and state tax witholdings.

But yeah their budget is incomplete and 2% is really low. Keep track of every penny (literally) for an entire month and your eyes will be opened.

[papa_squat]

Everyone here has already commented on the obvious; a budget doesn't do you any good unless you are tracking your ACTUAL expenses each month. My husband and I keep a spreadsheet and enter in each expense (Date, amount, where it was spent), categorize our expenses, and who spent what (i.e. my spending in pink, his in blue) and each month, we sit down to discuss the results. If we have expenses that are missing, we double-check the math, receipts and our memories to make sure every penny is accounted for. We programmed it to compare each catergory to previous months' categories to see if we are spending higher or lower in certain catergories and note trends. If our restaurants catergory has been high and we haven't had a lot of people visiting, we know we need to work on eating out less. Tracking the expenses helped us find our average spending in those categories and budget better for months to come. Sitting down together once a month also helped us discuss and anticipate upcoming expenses (a friend's wedding, upcoming birthdays and holidays, etc).

Definitely keep track of cash as well. If either of you take out cash, keep track of who took it out how much and where it is spent. Cash can create a massinve hole in your records when budgeting because there's no paper trail to follow.

Lastly, you should definitely be saving more than 2% for retirement. Put away 15-20% of your income in savings at the beginning of the money to essentially "pay yourself first" for retirement. That way, the money doesn't have any chance to get "lost" or be spent frivilously. If you had only one income while PalmTree (the wife) was at home, you should have budgeted extra retirement savings for her as well. Just because there has only been one income, that doesn't mean that she won't need retirement savings as well.

[Sham12345]

Salary and saving moning

Yes i agree with jpg points you must prepare a budget plan for a month if you follow your own budget , you will easily recover from your problems.