FIRE with a family
The best of a bad situation
Hey all you cool cats and kittens! We're back for another life update from March 2020.
What a crazy month this has turned out to be. It was our darling daughter's 7th birthday (she's spent more than half her life in Canada now!), Carole Baskin got away with murder, and who could forget what we're still living through - the COVID-19 pandemic.
It's pretty average to have to tell your daughter she couldn't have a party or invite her friends around to help her celebrate the day she entered the world. In the beginning the kids didn't fully understand why we were confined to our home, or why we weren't having friends around to visit. In saying that, it only took them a few days to start saying "We can't do that because of the virus".
I think most people would agree that COVID-19 has changed the way we live in this world. Country borders closed to all non-essential travel until further notice, Virgin Australia collapses into administration among other struggling airlines, and millions of businesses forced to close their doors for an indefinite amount of time.
A scary event for us was our workplace choosing to shut down for 2 weeks to protect the health of safety of our surrounding communities. We were lucky enough to still receive full pay during the shut down. Others around the globe haven't been so lucky and are going through some pretty hard financial times. The chart below illustrates the hardest hit industries according to CNBC as of May 8 (yes, I'm writing this on May 8, giving you an update for March. It is what it is)
You can see 'Mining and logging' is 13th on this list, and while they are nowhere near the hardest hit sector, we still feel the effects in our community. Social distancing is now the new norm with only a limited number of people allowed in a shop at once, sales of facemasks and disinfectant have gone through the roof, and toilet paper is arguably the world's hottest commodity right now.
Every area is different, some affected more than others, although I suspect many families would be experiencing the newly added joy of homeschooling. Isn't it fantastic?! That was a hint of sarcasm there if you didn't pick up on it. In all seriousness, we have a deeper appreciation for teachers and all they do for our children. Trying to teach our 9 year old son long division was definitely a stretch of everyone's patience, especially with his critique being, "Why does division have to exist? It doesn't even make sense!".
Being locked at home hasn't been all bad though. We've had to force ourselves to find new, creative to entertain ourselves which usually turns into a great bonding experience for all of us. Having all this time on our hands provides ample time for reflection and also allows us to cut back - or completely eliminate - some things we'd usually spend money on.
Savings update - another 11% closer to our annual goal
Some areas of spend started to see a decrease, while others like groceries and iTunes movies have increased slightly. All in all we came in pretty close to our original March budget as the impact of COVID-19 only started to have an effect toward the end of the month.
We managed to exceed our savings target for the month and creep 11% closer to our annual goal of having 50-60% of our combined net income saved. To be clear, when we save 50-60% of our combined net income we will have reached 100% of our target.
So far we're trending ahead of our savings target and we plan to keep it that way. If you read our last post (if you haven't, go do it now) I mentioned that our next milestone was to have 6 months of living expenses saved by June. Surprise update, we'll have that smashed by April 15. You beauty!
Oh, and one final update. March was the first month where we made any meaningful interest from the cash sitting in our high interest savings account. Our money made $40.95 without us doing anything with it. That is still a pretty low amount, I know. But it's passive income! This means I didn't have to do any extra work to earn it. This is a real-life example of what interest - when compounded -can do for you, and if you want to build wealth this becomes you're best friend.
Blake & Allanah - FIRE with a family