Family Gap Year Post #14: The Budgeting Process

One of the hardest parts about planning a Family Gap Year was getting our house rented. It was hard because it was 1) scary and 2) uncertain and 3) a non-negotiable. We absolutely had to rent out our house in order to pay for our mortgage or else we wouldn’t be able to afford a Family Gap Year.

And it’s not something you can reliably do far in advance! We listed our house on Zillow at the beginning of April for a June 1 move-in date. We got a signed lease on May 7th. Phew! I’m glad that stress is behind us.

We increased the stress for ourselves because we recently did a cash-out refinance on our house. The cash-out refi increased our monthly payment by more than $500. So we needed to rent out our house for a cost high enough to cover the new mortgage.

I’m grateful that Zillow made the process pretty straightforward. This is definitely not a paid advertisement for Zillow, but they do make it super-easy to list your house, collect applications, and review people’s credit histories and criminal records. At one point I wanted to verify that the applicants paid their rent on time at their previous place, so I called their apartment complex. They said, “No problem! Just send over the form and we’ll get it right back to you.” I had no idea what “the form” was, but I agreed and hung up. And then I turned to my trusty friend, Google, to figure it out. It was very easy to find a free (fillable!) PDF that I emailed to the apartment complex to verify their history of making payments.

I’m glad that part is behind us!

Now I’m moving on to finalizing our budget. It’s not as expensive as you might think to fund a Family Gap Year! It all depends on how fancy you want to get and what kinds of income streams you can have while you’re on the road.

For example, when we live in rural Hawai’i for three months, we will be paying less in rent than we do in Austin! And we won’t be paying for internet, electricity, trash, water, etc.

Another thing that helped us was that we have been paying for a lot of things in advance. For example, many of our AirBnbs have already been paid for. Several of our one-way plane tickets have already been paid for as well.

So now I’m trying to figure out what we will need to pay for on a monthly basis moving forward. I broke the expenses into two categories: expenses that we have to keep paying at home and our travel expenses.

Expenses Back at Home

And then these are our other expenses:

Travel Expenses

I built a model in Google Sheets that balanced our Revenue with our Expenses. And I tried to set it up with a little bit left over for savings every month. It’s going to be really expensive when we get back to Austin and we need to buy a new car and get some new furniture for our house. We are selling or donating a lot of our super-old furniture to make it possible to use a smaller (and more affordable) storage unit.

Our revenue is coming from four sources: my job, our two long-term rental properties, and our one AirBnb. Matt may also pick up some photography gigs while we are traveling, but I didn’t factor his income into the equation in order to be more conservative.

My plan is to set up automatic transfers within our bank account to move the money at the beginning of the month. For example, the $200 we have going toward “Savings for House Repair” will automatically transfer into a savings account at the start of the month.

We will track the money that is left in our account (gas, food, excursions, etc.) by hand in a small notebook. I’ve definitely used apps before (like Mint) but I think a small little notebook will be perfect for getting the whole family involved. I have visions of the boys manually doing the math on each shave ice expenditure and checking each other’s work.

I’m reading a book about a family gap year right now. In the story, the mom is the primary “budget czar.” I’m happy to be the one that sets up the system, but then I want everyone else to help me run it. And I love the idea of squeezing in extra math practice every day!

We are leaving on our trip SO SOON! Please remember I will be decreasing the frequency of my blogging to once a month. However, I have started posting on Instagram every day and I’ll still be writing a personal newsletter every week.

Yikes!