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DINK Dreaming

February 25th, 2009 at 01:32 pm

DINK, meaning dual-income, no kids

The underlying theme of my entire blog is how well we did before kids and how our life goal is to get back to that savings level. Days like this I am glad we had kids rather young. It's not like we have a large income to live up to since dh quit working so early on in his career (merely 3 years in?). If we had waited a few years we may have a smaller mortgage and bigger savings, but more income lost in the interim, etc. I think going young was the way to go.

We allowed enough time to save up that I stress when my efund is lower than 3 months' expenses and when I don't have enough cash to replace our cars, etc. IT's all relative. But once you have decent financial security, it is difficult to move backwards. I think also my biggest fear is we have been so lucky in our youth that I fear once we reach some DINK level we may just be kicked off by some outside forces; not by choice. (Job loss, natural disaster, anything).

I am reflecting on it much as we just reduced our expenses by almost $400/month by simply refinancing the house and switching preschools. Meaning, no change to our lifestyles, but wala, just about enough to fund an entire Roth!!

Anyway, the most dh ever brought home was $2500/month, so at our peak that was what we saved, in addition to 10% of my income to my 401k (about $5k). The $2500/month went to cash, where it eventually went to down payment on home, massive cash savings, cash for moderate car purchases, and a few thousand here and there into our IRAs over the years. Short-term savings (property taxes and the like), mid-term, long-term, all funded by dh's income.

So I am super excited as we near that savings level again. Though I have mentioned before, it is certainly not an apples to apples comparison.

For now we are at:

$1000/month short-term savings
$ 650/month cash savings
$ 350/month ROTHs
-------
$2000/month savings

Getting awfully close.

My increased retirement contributions, through my employer, and overtime, bring our savings level up by about another $500/month.

For a grand total of the magic number, $2500/month!

Of course, we have more expenses, and $2500 doesn't stretch as far as it used to. At least $3k/month is what we should aim for, to factor inflation. I guess that's the point where I don't care particularly if we have a second income while the kids are younger than teens. $3k/month to savings? - we're probably good.

We'll probably hit $2700/month once LM is done with preschool next summer.

Means merely another few thousand dollars a year in income will make a BIG difference.

WE actually just crossed over to the point where I feel like we are saving more than we "need" to in the long run. That certainly feels NICE. But we have things to catch up for. Building back up our cash savings, starting to think about college more, we will have a couple of cars to replace within the decade, AND we haven't put any money to speak of into our house since we purchased it 7 years ago - we have some work to do, etc. Beyond all that, we will err on the side of saving a bit too much cash in the interim because dh would like to go back to school to get a teaching credential or possibly upgrade his film/TV minor to a major. Whatever he does, he will probably go to school a bit to make himself more marketable. Of course we would like to pay cash (community college/state college is our aim - which is still quite affordable around here).

If the year is good we may be able to put $10k into cash this year - but you see we have a lot of competing goals. I wouldn't mind increasing the efund either.

Maybe it's eye opening to have so many of my clients coming in this year and "struggling" on one income in the $120k range. Sometimes I think we will always worry about money. We didn't so much when we were younger but I think it was due to being naive more than anything else. Ignorance can certainly be bliss.

But I do admit, aside from this whole catching up thing and trying to set aside $10k cash this year, I do feel significantly more relaxed with our current situation. No ill will towards those wil mortgage bail outs. They certainly can't feel my peace of mind and my freedom today.

It's funny though. The reason we decided we were ready for kids was when we bought our dream home in our low cost of living haven and we no longer thought we had to save $100k down for a starter home. That was precisely why we were saving so rapidly. We figured, "What do we need all this savings for anyway? Let's have kids."

Our expenses have stayed rather stagnate and my income has grown considerably over the years, which is why we are where we are at. But we do still have kids to support (orthodontics, piano lessons, college and the like) and I didn't know our medical insurance premiums pre-kids would grow by 8000% in just 3 or 4 years. I never expected we would last this long on one income and that dh would probably have to return to college to get a job.

Of course, if we expected all this, well, it wouldn't be life. Life isn't s'posed to be so easy, right?

But yeah, as we square away this whole preschool thing, it just hit me. Wait a minute, we didn't do anything but we are saving almost $400/month this year? Huh?

& I tell you, the extra overtime I can work with LM going to school by our house, instead of by my work when I used to drive him? I think preschool will just about pay for itself this year. Woohoo. Though I did play hooky yesterday to pick him up on his first day and figure since he will either arrive or leave in the noon hour (depending if he can get an a.m. class) I will have plenty of opportunity to go home at lunch (as I often do) and pick him up or drop him off once in a while. Arriving at work at 9 & having to leave at 4:45 always was such a time suck. Adding 15-minutes to a lunch once a week isn't as near of a big deal.

2 Responses to “DINK Dreaming”

  1. frugaltexan75 Says:

    MonkeyMama,

    You know, the WIA program I'm going through right now is a Federal program. There may be something like it in CA. To qualify for it, you need to either be laid off, or have been a main caregiver for children. So . . it may be something your DH might want to look into - if he's thinking about going back to school. (unless he's thinking more along the lines of another degree)

  2. monkeymama Says:

    That's good to know. Will have to keep that one in mind too! I might ask you about it again, later...

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