Projecting a deficit for May

There’s the last headline I wanted to write. Especially the second month in a row.

Truthfully, I knew two months ago that May might be dicey. I have a rental property, and my current tenants gave me notice they’d be out at the end of May. When they first became my tenants three years ago,  I collected first and last month’s rent. I have no idea where the last month’s rent went. So, I’m on the hook entirely on my own for the mortgage and taxes for the rental property.

Lesson learned in my new reality: when I get new tenants, park last month’s rent in high interest savings, and forget it’s there until it really is the last month.

Considering the revenue loss for that one item is $1295.00, my projection of about a $250.00 deficit isn’t bad.

Since I saw it coming, I did make a few changes. I took away my $50 for gardening. That hurt a bit. Also cut my public transit budget by $75.  We managed just fine. The nicer weather meant we walked a bit more.

Other hits against the budget included a dishwasher repair of $95.00, and a last minute invitation to a family 80th birthday party, which meant an expenditure of $80.00 for our brunch bill. I wouldn’t trade the working dishwasher or the brunch with family.The family dinner is really my ex-husband’s family. I haven’t seen most of them in over five years. A special invitation was extended to me to attend. On the drive home the youngest said “how much was brunch?”  When I told her she then asked “how much did we have in our dining out budget?”  When she heard me say “nothing” she gave me a funny look. It gave us a good opportunity to talk about priorities and how to identify the things that truly are important, rather than stuff that we’d forget about in a week or two.

I was hoping that the mortgage switcheroo for the rental property would have been a done deal in May, which will mean a windfall of about $1900.00. Doesn’t look like it’s likely to shake down for May. I haven’t projected that $1900 in my cash flow because it isn’t a done deal, at least not yet.

I may be holding the rental without tenants in June as well. We’ll just have to see. When I became a landlord, I accepted the notion that there may come a time when I have to carry the property for three months without revenue. I was prepared to do that then, and I am still prepared to do so.

So, for the second month in a row, there’s a couple hundred bucks spent that isn’t earned. The deficit doesn’t mean an increase in debt load. Back in February I met a short term goal of having a minimum balance in my chequing account to help shelter me from little storms. Although I used up some shelter last month, there’s still enough there to keep things on an even keel. I will restore that minimum balance by July.

There are no more months in 2010 where I’m projecting a deficit. Knock on wood. As of this morning, there’s $90 in the grocery jar to keep us going until May 31st. Time to dig deep in the freezer and get creative!  I know we’ll do it.

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