October 2011 shall be known henceforth as the month that the levee broke. In September, we had about $2,000 positive cash flow, but we gave it all back this month and then some.
| Income | October | September |
| Mrs. RB40′s paycheck | 2622 | 2984 |
| rental income | -3,104.00 | 468 |
| side income | 360 | 2222 |
| dividend, interest, P2P lending, stock | 568 | 278 |
| Total income | 446 | 5952 |
| Expense | ||
| Housing | -1,992 | -1,992 |
| food | -177 | 0 |
| cash allowance | -560 | -860 |
| transportation | -72 | -153 |
| pet | -54 | 0 |
| baby* (not counting daycare) | -144 | -42 |
| bills (electric, insurance, internet) | -257 | -246 |
| medical | 0 | -89 |
| entertainment | -132.00 | -34.00 |
| misc (IKEA) | -641.00 | -455.00 |
| Total expense | -4,028 | -3871 |
| saving (Income – Expense) | -3,582 | 2,081 |
*There is a bit of fuzzy accounting here because I didn’t count the cost of baby daycare. We paid $1165 a month, but it is covered with DCAP from my paycheck. It is already deducted pre-tax and we wouldn’t have seen it anyway. Also, once I quit work, then I’ll be home to take care of the little guy so I think we can zero it out as we look forward to the future.
** I don’t count my paycheck here because we are trying to live on one paycheck.
Income (Target > $5,000)
Rental Income – I changed the accounting method here and I’m now showing all income – expense. The property tax is also baked in now.
We sent in $3,000 to repair the roof, chimney chases, and the crawl space. These repairs were deferred maintenance from the previous owner and they were expected. We also had 2 plumbing calls and a stove replacement costing about $700. Cleaning fee, year end yard work, and the leasing fee wiped out the rest of the rental income.
All in all, we came in at -$3,104 in October. It was not a good month, but things are looking up for November. All 4 units are now rented out. The section 8 payment from the city came though at the end of October, but didn’t make it into the October statement. We’ve been seeing the rents from only 2 units because the section 8 renter arrived in the middle of September and the first section 8 payment takes extra time to process (according to the property manager.) We should see positive cash flow here in November and onward.
Side Income – Took a step backward, but this is not unexpected because online income is not stable.
We actually made about $1,000 online in October. However, I purchased a laptop, phone, flash for the camera, and helped out with two giveaways. I haven’t withheld any tax this year and I want to minimize tax by buying any business related equipment in 2011. October was probably not the right month to do this, though.
$400 laptop with the latest Intel Core 2 CPU!, $140 flash, $80 phone, and 2x $25 gift cards add up to an expensive month for business expense.
A bit more detail as requested.
We ended up with a net of $360 after the purchases. ($1,030 – $670)
The income this month all came from direct advertising.
We got banned from Google Adsense and they stiffed us our check for the last two months – $130. Thanks Google. I knew this was common after the first check from Google, but I was hoping it wouldn’t happen to us. I’m trying to get the ban remove, but I don’t have high hope. We had a bad malware attack in August and that probably led to some bad clicking. I’m trying media.net instead and it’s not doing that well so I will investigate other avenue. Yes, I’m bummed out, but life goes on.
Dividend, Interest, P2P lending, and Stock - The total for this one looks deceptively large.
Dividend – $12
Interest – $18
P2P – $17
I invested $1,000 with prosper.com. We’ll see if this works out in the long run.
Stock profit taking – $521
Took profit on some stocks.
Expense (Target < $4,000)
Housing – The housing expense is very high, but it’s stable at this point.
Food and Cash Allowance – I think about 90% of the cash allowance goes toward food, specifically groceries and eating out. My parents are visiting until the end of November so the food bill is going to be higher for a while.
Transportation – Kept it under $100 this month. I’m happy with this.
Baby – We purchased a bigger car seat for him. Diaper and food rounded out the rest.
Bills – stable.
Entertainment – This one is a bit high in October. Mrs. RB40 sent in her Toastmaster membership fee (she belongs to two clubs) and I spent $45 on 3 used XBOX games.
Misc – We got a new closet from IKEA. You can read all about it on the $440 baby gate post if you missed it. This category should go down next month.
October Cash Flow
All I can say is I’m glad October is gone. Our income falls way short of the target, but at least the expense was in the ball park. I don’t have a good feeling about November and December though. These are high expenditure months and I hope we can minimize the spending somewhat.
How about you? Did you have a good October? Did you know Halloween is the 2nd most expensive holiday now because everyone spends so much money on costumes?
{ 42 comments… read them below or add one }
You reminded me to buy a laptop before the year closes out.
There should be some nice sales on Black Friday. Do you guys do that in CA?
Your story is a reminder that investing in your future costs in the present. There are always going to be some upfront costs… but here’s to future income where you can sit by and have it roll in! P.S. Have you found a tenant for unit 4 yet?
Yes, all units are filled now. TGIF! Vacancy is the bane of any landlord’s existence.
I second Kevin’s point. I’ll purchase a laptop next week (it’s time) and some relevant educational materials. You are stimulating the economy with a post
I’m glad to help the economy in anyway I can. Maybe you should wait for Black Friday sales?
That’s exactly what my wife said. I guess I’m a little impatient since the one I primarily use for blogging crashed on me on Saturday
Sorry to hear that. You should search for a good deal now then. Business comes first!
And your side income came down – I’m sure it’ll bounce back quickly. Since you’re waiting on a renter, you’ll probably have one particularly good month to report on in the near future.
I think November will look a lot better.
Arghhh…I hate having to pay for maintenance issues, but the longer you wait, the more expensive they become.
I agree. It’s expensive now, but will get a lot more expensive if left untended.
I have been thinking of buying some equipment as a business expense. Thanks for the reminder.
Let us know what you purchased.
I know you purchased the laptop etc, but can you dive deeper into the 2k drop in side income? I don’t know if you include blogging income in this figure or not?
Updated per request. The revenue dropped from around $2,000 to $1,000. The income dropped even further due to the business expense so total income is only $360 this month. I expected online income to be up and down so this doesn’t surprise me much.
Sucks about Adsense. Don’t expect to get your account opened back up. And if you open a second one (even with your wifes google account) they will detect it and shut you down again. I know this because I had this happen to me in the Android Market.
I don’t have high hope, but I do know one person who got her account reinstated – Suba!
I’ll have to find a good alternative to Adsense if they don’t reinstate the site.
I need a laptop to blog when I’m away, I know TigerDirect got some good deals though:)
I’m sure there will be tons of good deals on Black Friday.
Nice month!
I bought a laptop a few months back, but I still need a cheap (but decent) camera and eventually a decent phone…
I’ll probably buy the camera in the next few week, but I might hold off on the phone until next year.
Good move taking some profits, the markets are looking more scary all the time!!!
Look at that side hustle income! I love it. Hey did you check on the section 8 payments and their timing? Also, make sure you have your property manager send you the actual section 8 contract. The contract will let you know the exact amount you should be receiving.
I’m going through city and section 8 inspections now for my recent purchase. Those things are a pain in the rear. But, I already have a tenant in my home just need to pass the inspection to get checks. This tenant gets 100% assistance from the government.. Winning!
The property manager said the tenant moved in mid month September and it takes some time for the section 8 payment to come through. I talked to him at the end of October after I received the monthly statement and he said the check came in and I should see it in the next statement. I’ll ask him to send me a copy of the contract.
100% payment from the city is a nice win.
Good idea to get those blog expenses in now. October may not have been a great month to do it, but November and December probably wouldn’t have been any better.
My October was kind of ugly too. I had a major car repair that I felt okay about because we used our emergency fund, but now my accounts have frowny faces.
You’re right. The last quarter of the year is always expensive. We have to pay property tax in November so I don’t have a good feeling for this month either.
You got attacked by a malware AND banned by Google? What the hell happened?
You are trying to live on one paycheck. This is one of my long-term goals!
Yeah, I got 3 malware attacks over the summer. The last one brought in tons of traffic, but I think those also generated some clicks. I changed theme and things seem to be better for now.
Joe did the letter from Google say ‘Improper clicks’ or ‘you are risk to our customers’ or “not abiding by google” policies? In my very early stage I was risk to their customers. I now think that would be probably due to missing privacy page and having more than three add blocks on front page.
It really hurts
I got significant risk. I’m still suspecting the malware attacks. I’ve had the privacy policy page up way before I started adsense.
Man, I hear you on rental expenses. Sucks man.
There’s a lot better income generation than Adsense. Not to worry man.
I like Adsense because it’s very passive. I’ll have to find something to replace it. Oh well…
I jump through way too many hoops for G too…with zero payback so far. It’s ironic that our sites would probably look a whole lot more appealing to paying advertisers without the clutter of Adsense.
They have a monopoly, what can we do….
You are the 6th blogger that I’ve seen get banned after their first check. Maybe its a systematic policy.
I too want to purchase a laptop, but I do think I’ll wait until Black Friday. My husband thinks Apple’s the only way to go, but for my purposes, I think a PC could work.
Good luck on your search. PC is still so much cheaper than an Apple laptop.
Looks like you had a rough go in october joe. Glad that everything is rented out and things are on the up-and-up with your rentals./
That sucks about adsense, hopefully they will let you back in
Thanks! Hopefully things will start to look up next month.
When it comes to rentals, those expenses will be there. In general, we all have months where we have to spend a considerable amount of money. It’s just the way it is, be it home repairs, car purchase, vacations, etc.
With the online income, that’s up and down, but it looks like you had a better month in September – which tells you what’s possible.
I’m thinking this is just one of those months, the way it looks on paper, and next month will look better. You guys are doing great, it seems!
That’s true. I have to learn more about fluctuating income before I leave my day job. I guess we’ll have to have a bigger pile of cash on hand.
I love that you purchased a reasonable laptop…I consistently fight with my friends about this topic. My argument? Most people don’t do anything on a computer outside the word processor, listening to music and streaming some videos and almost any laptop on the market can do that today!
I have a powerful desktop already so I don’t need another powerful computer. All I use on this laptop is MS office and internet browser. I wouldn’t want to spend more than $500 for that.
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