Last year I successfully tracked every penny spent and earned for the entire year! It’s been a goal of mine for a while now, so I’m really excited to be able to look at real numbers and not just my always-lofty estimates.
In future posts, I’ll delve into my process for tracking all of this, but for now, I just want to give you the hard numbers and some wins and some losses.
Before we jump in, I just want to note, if any of these numbers seem impossible to you, here are some reasons why:
- We have no kids
- Neither of us has student loans (we’re both college dropouts and were able to pay our fairly small debts back right away)
- We don’t live in an expensive area
- We only have 1 car that was fully paid for
- We both work from home
Average spent per month
- Food: $450
- Shopping: $560
- Travel: $240
- Entertainment: $58
- Giving: $320
- Medical: $68
- Car: $190
- Phone: $52
- Internet: $53
- Utilities: $94
- Rent: $1000
Monthly Total: $3,085 Year Total: $37,020
The biggest, most importantist number:
Savings Rate: 38%
This number is the only number that matters. It’s the number that determines how long until you are financially independent and when work becomes optional.
(I'm going to a dedicated post on this number, what went into it, and what it means for me - stay tuned!)
Phone Bill ($52)
Last year I made the leap away from an iPhone on Verizon to a Google Nexus 5X on Google Project Fi. Between Hannah and I, we were paying $120/mo. to Verizon, not to mention the 2-year contract we were bound to. It wasn’t easy giving up the iPhone, but it was well worth the ~$70 savings per month, or extra $840 dollars in our pocket at the end of the year.
We moved from a $1200/mo. Apartment to an $850/mo apartment. This was a big one. We went from a fancy pants industrial loft apartment in the city to an upper in the suburbs. This was a big leap for me and I really thought I would be less happy. Turns out, if you have a base-level of fanciness, like good natural lighting and being able to walk to everything, you can be just as happy without a spiral staircase and ridiculously high ceilings.
I know some of you are are shocked hearing me say the words “fancy apartment” and “$1200” in the same sentence. “Buffalo” is all I have to say to that.
We got rid of our other car a couple years ago just to see if life with one car was possible. Turns out, over time, it’s completely doable. Every once in a while we have to do something drastic (sarcasm) like borrow a family members car for the day, but mostly it’s just biking more and arranging our life close to our home.
This also means only 1 insurance payment, inspection, registration, a pair of snow tires, etc… I haven’t measured it, but I’m positive these savings really add up over time.
We went from eating out almost every day, to almost never eating out unless it’s on a date or with friends. We have successfully shifted into the mindset that eating out is purely a thing you do for social reasons, and even then, not on a regular basis. However, we also started eating better food at home which countered our savings a bit, but healthy food is one of the last things to optimize IMO. (still important to optimize though)
All last year we flew for free with Southwest points and the ultimate travel hack: The Southwest Companion Pass. Anywhere I flew last year (and the year before) I could take one passenger with me for free. Also, to earn this benefit you end up racking up tons of points, making the first person’s flight free anyways!
This is the biggest issue for me. When you hear me say: “I have a shopping problem”, don’t picture a guy with a pile of department store bags walking through the mall, picture a guy sitting at a standing desk with an iPad and Bose wireless headphones, or a guy backpacking on the cover of an REI catalog.
Even though I don’t consider what I’m buying useless crap, it’s still a huge problem for me. I get way too excited at the possibility of needing to buy something. I could write for days on all the consumer habits baked into my brain that I’m always striving for freedom from, but I’ll save that for another post.
Even though our car expenses are pretty low, there is always room to improve. There are lots of times I could have biked, and this year my goal is to really up my biking game - I’m pretty good at walking/biking for errands under a mile or so, but I could use to increase my radius to something more like 3-5 miles.
When I look at all these numbers from a birds-eye-view, my big goals for 2018 are:
- Buy fewer fancy things
- Get money out of savings and into investments
- Bike/walk more
- Hit $2500 in spending for at least 1 month
Btw, I’ve been working on a little app that would basically replace all my spreadsheets for measuring this stuff, if you’re interested in getting updates on it, follow me on twitter: @fancyfinanceman