Savings rate challenge results – July 2019

One month down, eleven to go! (Of the Savings Rate Challenge, that is.)

July went quite well, all things considered. My budget is – in many ways – still a work in progress, as there are a number of items that can’t be predicted yet. There are quite a few projected figures that are just my best guess at the moment, but I expect over time my projections will get better as I gather precise data.

Despite spending about $480 more than expected, this was more than offset by July being one of the couple of months each year where three pay days fall within the month.

So, where did the variances come from? Personal and discretionary costs were the main culprits. As far as personal items go (e.g. clothing, cosmetics, hairdressing, and medical/dental), I haven’t really worked out projections for some of these as yet, so the variance will look significant until the budget gets refined. Discretionary costs were substantial due to there being a few birthdays among family and friends in July, so there were celebration costs. A little bit of eating out was also a factor – particularly for the French Festival at the start of the month! I hadn’t been to this before, but had paid for a ticket earlier in the year, so I was committed to going.

Pet-related spending was also a bit over. My beautiful old girl is experiencing more health issues and arthritic/rheumatic pain as the years go by, so the veterinary and medication costs are building now as the vet and I work to do what we can to minimise her pain and ensure she is as healthy as possible. This includes monthly injections as well as ongoing medications to manage liver and kidney issues (common in older cats). Still, she’s cost me very little for the majority of her life – just food and annual vet checks/vaccinations – so I don’t mind having to spend a bit more to keep her as comfortable as possible in her dotage. (Hopefully my one and only niece will look after me when I’m in the same boat!)

On the plus side, a little extra money came in via receiving additional pay for some higher duties I did in June, plus a little bit of interest on the savings accounts. I’m also saving 5% on most of my groceries and any items I buy from the Woolworths-owned shops, due to being able to buy their gift cards at a discount through the union, so that helps too. I’ve deliberately avoided using the heater as much as possible, opting instead for adding clothing items and a blanket at night while I’m watching TV, so that has helped keep the power costs below the budgeted figure (although I padded the projected amount a bit anyway to allow for any increases).

Speaking of interest on savings accounts, I decided to move my BISAs (bonus interest savings accounts) to RAMS. The shift to a ‘minimal spending’ mode this month, plus the use of gift cards for grocery shopping, resulted in it being impossible to meet the conditions around earning the bonus interest at my usual bank (a tap-and-go payment from the linked transaction accounts every week). The RAMS account I’ve opened only requires a minimum of $200 per month being deposited without any withdrawals (which works well for me). As an additional bonus, the total interest rate is now 0.2% higher than my usual bank’s bonus interest rate, so it was a no-brainer to make the switch.

The wash-up

Happily, at the end of the month my regular savings (i.e. money that I was already putting aside anyway) represented 38.05% of my income and the additional net cash flow left over represented another 25.62%, for a total savings rate for the month of 63.67%. (Naturally, these figures won’t be repeated in months with only two pay days, but at least I’ve gotten off to a good start 😀 ).