How much did you spend in 2006?

[Nords]

I thought I'd encore Soupcxan's expenses thread.

Here's the Nords numbers:

825 Kid's Allowance (more for clothing & toiletries)
1500 Kid's school (mostly Kumon, bus passes, & school supplies)
1925 Kid's sports (mostly tae kwon do and some home exercise equipment)
150 Kid's toys (a paintball blowout and USNA souvenirs)
225 Adult clothing (including Navy uniforms)
875 Computer (monthly DSL, new graphics card, more RAM, printer ink)
2000 Dining
250 Entertainment (mostly movies & ice cream)
175 Surfing (safety fins & ding-repair supplies)
3200 Dad's tae kwon do (tuition, tournaments, orthopedic knee braces)
500 Gifts given
5800 Groceries
250 Pets (bunny food & vet bills, vacation care)
275 Tchotchkes (spouse nearly tripled this from last year!)
2200 Home Improvement (master bedroom carpeting, a bit of solar equipment)
750 Car insurance
900 Home insurance
650 Personal property & liability insurance
250 Investment expenses (books, magazines, ER board's server fund)
1200 Medical & dental (mostly TRICARE premiums & dental visits)
18300 Mortgage interest
4800 Mortgage principal
6200 Federal taxes
4425 Property taxes
1400 Gas (more surfing this year)
2600 Car repairs & service (100K checkup & A/C overhaul on '94 Taurus wagon)
425 Electricity (down 45% from last year!)
350 HOA dues
350 Phone
525 CATV, although this should probably be entertainment
850 Water & sewer
5800 Vacations

$69,925.

Not as much as last year's $83K but clearly feeling this year's wealth effect.

We're still carrying the mortgage for retirement-portfolio arbitrage so that's an extra $23K. My tae kwon do expenses were out of control this year to the tune of another $2K but hopefully 2007 will settle down (and this time I really mean that). Without those expenses the annual spending drops to $45K. My $36K pension is covering the basics and like other ERs we still have room for belt-tightening.

[Martha]

Thanks Nords.

One of my new years resolutions is to keep track of what we spend. So should I download quicken or go buy a copy?

[DRiP Guy]

Quote:

Originally Posted by Nords I thought I'd encore Soupcxan's expenses thread [snip] We're still carrying the mortgage for retirement-portfolio arbitrage so that's an extra $23K.

First, Happy New Year to all!

Second, Thanks, Nords and others who are sharing their budget info, and have done so in past -- very intriguing and enlightening for me.

Finally, just a comment -- I recently paid off $33K I had left on a 5.375% mortgage, and I did it not for pure financial reasons but for 'clean up and trim the sails' organizational and psychological reasons, mostly. I figured I could beat that easily with net investment returns, but this is one area where my gut won over.

It looks like your own decision to carry a 5.5% mortgage is a decent one. Assuming you bought and held IJS for the little over two tear period, since Oct 2004, that is a capital-only price appreciation of 6.8% per year, so I wonder if you ever do a 'net' on just that one budgeting choice. Adding in the tax advantage of having the mortgage, but closing costs, charges, etc... I just wonder what the 'big picture' bottom line numbers would be.

I am not second guessing your own choice, I guess I am wondering how much my own (and many others) decision to pay off might cost them assuming today's rates of investment return, tax, and of course mort interest rates.

[saluki9]

I don't have the free time patience of Nords to type out all of the line items from this year.

Total spending was up 9% to 96,511.08. Some interesting (to me at least) side notes

Taxes made up almost 45% of my spending.

My employee portion of health insurance was $4451

My hobbies were all kept in check except for electronic stuff. Maybe buying a new computer, digital SLR, and LCD TV in one year was a bad idea?

People need to tell me if I dress like a slob. Only $500 on new clothes in the last 2 years.

[JDARNELL]

Quote:

Originally Posted by Nords I thought I'd encore Soupcxan's expenses thread. We're still carrying the mortgage for retirement-portfolio arbitrage so that's an extra $23K.

Just curious your thoughts on why you carry the mortgage?

Tomcat98

[mmg2681]

I do not track my expenses, but this is the new year.
I am going to start... as of today.

I will have to go do research with my Money program on the computer.

Thank you, everyone, for the motivation! I'm going to need it throughout the year!

~M

[saluki9]

Quote:

Originally Posted by Tomcat98 Just curious your thoughts on why you carry the mortgage? Tomcat98

Well, because he thinks he can earn a higher return on investment by investing the money instead of paying off his mortgage.

[dm]

I don't have everything itemized, but I do track the monthly checks written.

This year we went through $125,000.

$30,000 was for a car.
$12,000 for golf, I joined a new club so $5000 of this was a one time fee.
$5,000 for the wifes invisible braces
$10,000 for college classes.
$15,000 was given to kids.
$8000 went to taxes and insurance.

That leaves $45,000 that Im going to do a better job of tracking in 07.

Last year we spent about $75000 with two kids in college so we went overboard this year. The kids are out of school now and hopefully the kid expense will go down some.

[rmark]

Everything minus 10%.

[kumquat]

Everything plus 10%

[Alan]

this is the first year in 3 that I haven't tracked expenses to the line item, but I did track overall spending by recording every after tax dollar received and every dollar that went into savings accounts. Outside of long term savings I keep an emergency account which fluctuates throughout the year so I also include the annual net change in that. I have also used this method in parallel with the line item tracking to ensure I have a high correlation so that I can use the simpler method ongoing and only revert back to detailed accounting should I need to.

This year's expenses were $59,242, down $10K on 2005 because of lower school fees and expenses for our son. This is in line with previous years which is why I budget for $60K retirement needs.

I still track some major expenses which were:

16,336 - Rent, includes all maintenance, taxes, etc
15,150 - Son's college costs including pre-graduation gift of a car.
6,800 - Travel
4,285 - Health costs
2,800 - Insurance policies (life, accidental death, disability)
1,600 - Insurance - LTC


Son should graduate in 2 months, so expecting a nice big pay rise ;=) His 10 year old car pegged out this year so we splashed out $10K on a car for his graduation ahead of time.

[Nords]

Quote:

Originally Posted by DRiP Guy It looks like your own decision to carry a 5.5% mortgage is a decent one. Assuming you bought and held IJS for the little over two tear period, since Oct 2004, that is a capital-only price appreciation of 6.8% per year, so I wonder if you ever do a 'net' on just that one budgeting choice. Adding in the tax advantage of having the mortgage, but closing costs, charges, etc... I just wonder what the 'big picture' bottom line numbers would be.

Quote:

Originally Posted by Tomcat98 Just curious your thoughts on why you carry the mortgage? Tomcat98

Quote:

Originally Posted by saluki9 Well, because he thinks he can earn a higher return on investment by investing the money instead of paying off his mortgage.

I updated the thread over here. It's up a total of 40% over 27 months, or roughly 16% APY.

The money sure is nice, but what's even more attractive is the side effect of a bigger ER portfolio-- which FIRECalc deems more survivable. In terms of not running out of money during a prolonged bear market, bigger is better. If the stock market goes to hell in a handbasket we can cut our expenses way back and sell stocks if we have to, but no matter how bad things get the military pension deposit will still keep showing up in my checking account 10 days before the mortgage payment is deducted.

The odds of making money off this 30-year 5.375% arbitrage are over 70%, but I wouldn't try it without that gold-plated pension cashflow.

A 40% return looks pretty good so far, but I won't be feeling validated until it builds up at least a decade of reinvested momentum. I think I appreciate how you guys feel about selling your REITs last year, and I sure hope the small-cap value premium survives the reversion to the mean...

[Khan]

Gross was about $30k, and I spent less than that.


I'll work out the details later.

[Martha]

Quote:

Originally Posted by saluki9 People need to tell me if I dress like a slob. Only $500 on new clothes in the last 2 years.

I'm impressed. I spent that much on shoes the last two years. :P

[saluki9]

Quote:

Originally Posted by Martha I'm impressed. I spent that much on shoes the last two years. :P

Yeah, but did I mention I spent $8,500 on a new camera, TV, and Computer? :P

[Martha]

Quote:

Originally Posted by saluki9 Yeah, but did I mention I spent $8,500 on a new camera, TV, and Computer? :P

I feel better now.

[Nords]

Quote:

Originally Posted by Martha I'm impressed. I spent that much on shoes the last two years. :P

Well, of our $225 my spouse blew $55 on a pair of Navy Corfams and I splurged on a $25 leather wallet...

[grumpy]

I didn't bother to split out the charges on my credit card this year so the category breakout doesn't reflect all of the expenses for each category:

Auto $544
Cash $6557
Computer $845
Credit card $45907
Entertainment $574
Gifts $3289
Home repair $490
HOA Fees $2310
Household $868
Insurance $2427
Medical $4849
Taxes $13060
Utilities $5011
Other $1998

Total $88185

Grumpy

[d]

given all the talk of LBYM, you folks sure have a lots of means.

[Alan]

I am pleasantly surprised to see all the "high" spending done by some of the folks on this forum. I had been feeling a bit guilty about how much we spend, even though we save over 60% of a very high income.