2017 Spending Summary and Analysis

[friar1610]

Man! I get tired just looking at the level of detail in some of these summaries. I could easily dig out all the info but don't see the need to. Do I have more in the port than last year? Yes? Then fine. Are we still reinvesting (or giving to charity) our RMDs? Another good sign. How about the SS checks - still banking most of them? Great. That's the level of detail I deal in. Not criticizing anyone who keeps meticulous records but it's not my style.

That said, if a bill (say, car insurance) seems high, I'll go back and check it vs. the past few years and try to understand why and whether or not there's anything I can do about it.

 

[UtahSkier]

I wonder if “Groceries” is the sum of “Groceries:General” and “Groceries:Spirits”?

Yes. Items with a semicolon are sub categories.

And yes groceries is the catch all category for everything purchased at Walmart, Costco and grocery stores.

 

[cranberryjoe]

Just a tiny quibble, even if you pay cash for the car, I'd probably break it out of my budget or put a reasonable deprecation number each year I used it. The car is obviously not worth zero so you really didn't spend the entire purchase price.

True. I don't track the current value of assets like car or home. I used to try, but I didn't find it useful to me. I'm in the fortunate position that a few thousand here or there makes no difference, and I don't really care about tracking the potential trade-in value of a car until I actually trade it in.

I actually do have sub-categories of Automobile expenses in MoneyDance that I didn't break out in the first post:

Auto Insurance $1174
Car Payment $36993
Gasoline $861
Liability Insurance $119
License $86
Maintenance $1279 (spent mostly on the old car)
Other $439

With this break out I can see I spent more on gasoline this year than last, probably from more road trips in the new car, and the new car gets slightly lower city gas mileage than the old one. That "Other" category is larger than usual, mostly with one-time purchases related to the new car.

 

[bobandsherry]

I think this applies to other categories too, eg Auto and Vacation. It would have been clearer if those category headings had been offset or bolded.

Yes, that does seem like a lot of groceries. Presumably it’s not just food, but household cleaning products, etc.

I'm not going to be critical of format for anyone who's willing to share.

My spend for groceries includes cleaning products as well, basically anything that we buy as we go shopping for groceries and would include liquor. Can't say we've gone hungry, have fridge and pantry full of food (too much as I keep telling my wife), and we've spent just over $5,000.

 

[audreyh1]

I think this applies to other categories too, eg Auto and Vacation. It would have been clearer if those category headings had been offset or bolded.

Yes, that does seem like a lot of groceries. Presumably it’s not just food, but household cleaning products, etc.

That looks like the Quicken report format. Quicken has subcategories but also gives the category total.

 

[Meadbh]

For the first 3.5 years of ER, I itemized all expenses every month and could have produced tables like these. By that time I had become sufficiently familiar with my spending patterns that I didn’t feel that level of detail was necessary any longer. Nowadays I just document NW, total spending and WR at the end of the year. If I have concerns about the sustainability of my portfolio, I can always resume tracking the granular data. For now, my NW has increased by almost double my cumulative expenses since RE, so it’s all good.

 

[cranberryjoe]

Man! I get tired just looking at the level of detail in some of these summaries. I could easily dig out all the info but don't see the need to. Do I have more in the port than last year? Yes? Then fine. Are we still reinvesting (or giving to charity) our RMDs? Another good sign. How about the SS checks - still banking most of them? Great. That's the level of detail I deal in. Not criticizing anyone who keeps meticulous records but it's not my style.

If you've been using software like Quicken or MoneyDance for years to track account balances and bills, and if you pay for most things with credit cards rather than cash, the categorization is pretty much automatic. I download the credit card transactions, MoneyDance automatically assigns a category based on past spending history, which is correct 9 times out of 10. I examine each downloaded transaction to be sure I recognize it, and adjust the category if necessary (usually not). If I want to compare spending with last year, it's one click.

Expense categorization was most useful to me when I was preparing for retirement. A simple report in MoneyDance showed my spending by category for the past several years. I looked at the trends, guessed how they might change after retirement, and used that to make an informed decision. Otherwise, the categorization is mostly for curiosity.

Not trying to convince you or anyone to change. Whatever works for you is great. I was a data geek during my working career, so exploring data and looking at trends was a natural thing for me to do. Obviously there are plenty of us here!

 

[scrabbler1]

I live in a co-op apartment so many of my housing expenses are combined; I don't receive the co-op's annual report until March or April. Many of my other expenses, especially the smaller ones, are paid in cash. This leaves me with far fewer easily quantifiable categories than what many others have posted here.


That being said, I have some rough estimates of my larger and more easily quantifiable categories of spending in 2017 (1 person).




$7,852 - Medical expenses including health insurance and dental costs, including ACA subsidy I have to give back for 2017 after going over ACA subsidy cliff.
$6,968 - Housing, from co-op maintenance payments (includes property taxes net of state property tax rebate) added to personal HO insurance.
$4,684 - Federal and state income taxes owed, not including payments for 2016.
$2,216 - Utilities, including electric, cable TV, Internet, and landline phone.
$1,929 - Car, including insurance, repairs, registration (not gas).
$3,007 - Everything else (mostly food but also includes square dance fees).


$26,656 - Total

 

[bobandsherry]

For the first 3.5 years of ER, I itemized all expenses every month and could have produced tables like these. By that time I had become sufficiently familiar with my spending patterns that I didn’t feel that level of detail was necessary any longer. Nowadays I just document NW, total spending and WR at the end of the year. If I have concerns about the sustainability of my portfolio, I can always resume tracking the granular data. For now, my NW has increased by almost double my cumulative expenses since RE, so it’s all good.

For me, not a lot of work. I use Quicken, download my transactions and put in the categories (almost all are now automatically filled), a few minutes a couple times a week. Summarizes my spending without any additional effort.

Worth the few minutes for me as I also get my portfolio info and more importantly for me, my taxable income (just to be sure I don't hit the ACA cliff) without any other effort too. I also ensure there's no fraud on my account by quickly identifying any "probes" as I have full view of my transactions. Another benefit is not having to maintain a stand along check register.

 

[Danmar]

I only budget after income tax spending because that’s the only ones I can predict and usually control.

Income taxes are driven by our investments and wildly unpredictable from year to year. So I don’t put them in the annual budget.

So you don’t budget for income?

 

[skywalker]

Here's 2017. Been averaging around 50k annual spend the past five years. Fyi...HCOL area.

	2017
Property Taxes	$6,949.13
Home Upkeep & Improvement	$7,567.00
Insurance (home + Umb.+EQ)	$1,460.00
Heating	$1,408.00
Internet/TV (CC)	$679.00
Phone (CC)	$1,427.00
Water/Garbage (CC)	$1,793.00
Home + Utilities	$21,283.13	42%
Auto & Transport	$525.00
Auto Insurance	$775.00
Gas	$1,176.00
Auto & Transport	$2,476.00	5%
Doctors	$2,253.00
Pharmacy	$171.00
Misc	$543.00
Health	$2,967.00	6%
Groceries (CC)	$3,641.00
Restaurants (CC)	$3,367.00
Food & Dining	$7,008.00	14%
Shopping general	$4,053.00
Clothing	$3,997.00
Shopping	$8,050.00	16%
Entertainment	$1,588.00
Travel (CC)	$5,909.00
Charity	$1,200.00
Ent. Travel	$8,697.00	17%
Total	$50,481.13	100%
Per Month	$4,206.76

--------------------------------------------------------------------------
About the time I can make ends meet, somebody moves the ends.

 

[braumeister]

Changes in total spending (or percents) might be interesting, but I always get the impression that category breakdowns are useless because everyone categorizes things differently.

My spending categories are unique to me, because I keep things simple, and wouldn't equate to anyone else's. I have only seven: Auto, Cash/Food/Entertainment, Hobby/Travel, House/Utilities, Medical, Miscellaneous, and Taxes. I seriously doubt that anyone else does it that way, but it works for me, just as your categories work for you.

 

[W2R]

Just a tiny quibble, even if you pay cash for the car, I'd probably break it out of my budget or put a reasonable deprecation number each year I used it. The car is obviously not worth zero so you really didn't spend the entire purchase price.

As long as it is included in spending somewhere, it seems OK to me. After thinking about it a lot last night and doing a lot of soul searching, I'm planning to include what I pay to buy my future new SUV (minus what I get for the old SUV) in my 2018 spending instead of dividing it up between 2017 and 2018 as I had previously planned.

My reasoning for this is that it is easier for me to understand and I like to keep things as simple as possible to avoid and eliminate any possible wishful thinking errors. Spreading the cost out over two years was getting too complicated. The full SUV purchase price (minus what I get for the Venza) will fit in my 2018 expenses with my spending still under 3.4% so I think that for me, this makes the most sense.

So, this year's spending was 1.58% of my 12/31/2016 portfolio, and next year if I spend the same and include the new SUV it will probably be around 3.3% of today's portfolio. Or, it could be less depending on the SUV purchase price.

Like many of us I am in a good financial position at the present moment, thanks to the long term, strong bull market for the past ~9 years.

 

[rodi]

I'm stunned by your DH Medicare costs, was that for the whole 12 months?

It was - and I think I missed a tag somewhere... it should be closer to $2500.

$134 medicare B
$60 medicare F+ (high deductible F)
$17 medicare D

Medicare has been a huge savings for us.

We chose the F+ policy in large part due to advice/discussion here. The high deductible only applies to the remainder after the medicare B (first 80%). And the deductible is half the value of the HDHP individual deductible the boys and I are on which applies from the first $ (vs 20% of the first dollar.)

Also - in the interest of fairness, transparency, and honesty... My education column was off by $100. I forgot to account for the check I am writing this morning to our piano teacher. ($50/hour x2 for both boys weekly piano lessons.)

And - as others discussed... my groceries tally is for all items purchased at "grocery" stores: Vons, Sprouts, Costco, Trader Joes, Ralphs, Ranch 99, Zion Market, Pacific Seafood, Harvest International Market, etc. So when I buy printer paper and school supplies and sweatshirts at costco... it goes in the groceries category... and when I buy Shawarma takeout at Harvest international it goes under grocery rather than restaurants. It's too much trouble to break out the sub items on the receipts.

 

[bobandsherry]

As long as it is included in spending somewhere, it seems OK to me. After thinking about it a lot last night and doing a lot of soul searching, I'm planning to include what I pay to buy my future new SUV (minus what I get for the old SUV) in my 2018 spending instead of dividing it up between 2017 and 2018 as I had previously planned.

If you are just showing cash inflow/outflow then your approach is fine. However, your way to me overstates what your expense are, especially compared to other years. I'd show the spend as an asset and then take depreciation (estimate) each year. Not that much more complicated and is actually is more reflective of your actual expenses. Just my input, ignore it as you see fit.

 

[athena53]

Here are my major items- one person LCOL Area.


Travel $27,000 (about $12,000 is for 2019 and 2020; $3,000 had been reserved at 12/16)
Charity $21,000
Taxes $21,000- Includes about $5K underpayment on 2016 taxes.
Health Insurance $8,700 (Medicare starts tomorrow- Woo-hoo!)
Home improvement/maintenance $9,500 (about $6,000 reserved at 12/16). I've now done all the improvements I planned so this should slow down.
Mortgage $8,400




Some areas where I'm pretty cheap:
Alcohol $840
Restaurants $1,200 (sometimes included DS and family)
Utilities 4,200 - Google Fiber + Netflix, keep the HVAC system off when I can.
Clothing- $540.

 

[RetiredGypsy]

Not criticizing anyone who keeps meticulous records but it's not my style.

My credit cards and bank statements come as easily copied and pasted spreadsheets, so my meticulous records is just a matter of copy/paste and sort, with a few math functions thrown in to sum it up.

 

[robnplunder]

2016 - 85k

2017 - 111k

• Most of the increase was due to supporting DS's graduate school program, which was an unexpected expense. That will continue for 2018.

• Reduced expenses on number of areas like dicontinuing DIsh subscription. Whatever I've saved through reduction, I spent it on 2018 traveling expense, paid in advance.

 

[W2R]

I have to say, I find this thread refreshing. I figured you were all millionaires, so it's nice to see some down to earth living expenses.

Absolutely! Early Retirement Forum members have a wide range of living expenses, as you can see. Some here are millionaires, but don't spend that much, and vice versa.

In my case, I have no dependents at present. If I did, I'd probably be spending a lot more.

Location can make a huge difference, too, since the cost of living is dramatically more in some parts of the US than it is in some others. And extensive travel or expensive hobbies can add a lot to one's spending.

 

[W2R]

If you are just showing cash inflow/outflow then your approach is fine. However, your way to me overstates what your expense are, especially compared to other years. I'd show the spend as an asset and then take depreciation (estimate) each year. Not that much more complicated and is actually is more reflective of your actual expenses. Just my input, ignore it as you see fit.

As I already stated, I think I will ignore it, thanks. I don't think that honestly including everything I spent buying a car in the year when I spent it, overstates what my spending is at all; if I spent the money, it is spent. That's reality, in my life anyway, whether I total the car in a month or keep driving it for 20 years. If I can buy something and keep my spending under 4% I don't see what the big deal is in owning up to having bought it that year.

 

[Ronstar]

Item|Amount|Notes
Auto| $41,132| (includes new truck payoff $32608)
Condo| $8,158| (includes HOA, utilities, taxes)
Travel and Entertainment| $5,492
Food & dining| $8,391
Health| $967
Home Imp| $8,023
Lawn & Garden| $3,573| (Includes $3000 tree removal)
Electronics and software| $5,462| (Includes $4248 TV)
Hobbies| $4,306
Misc| $4,496
State & Fed tax| $7,708
Real Estate tax| $8,102
Utilities| $3,012
Total| $108,822

DW and I keep our money separate. Above expenses are mine - I don't track hers, but she pays electrical bill, car and home insurance, charity and most groceries. And then spends whatever is left of her pension on herself.

 

[ivinsfan]

As I already stated, I think I will ignore it, thanks. I don't think that honestly including everything I spent buying a car in the year when I spent it, overstates what my spending is at all; if I spent the money, it is spent. That's reality, in my life anyway, whether I total the car in a month or keep driving it for 20 years. If I can buy something and keep my spending under 4% I don't see what the big deal is in owning up to having bought it that year.

There isn't a big deal, the thread actually does talk about 2017 expenses. I think some of us are confusing budget with expenses....

To know the exact cost of running your car per year in a budget you would need to breakout depreciation and not lump sum it. But in a cash out year expense, it would just another check written. When you sell your old car it's easy enough to subtract the new price from the used selling price, divide by number of years and there you have the actual cost per year..

 

[bigcmagor]

We had a tough year with lots of those lumpy expense items. Replaced a 15 year old car, launched DD who bought a condo and totaled her second Honda Fit, did $20,000 in household improvements and married off DS #1. Glad to get these out of the way prior to the paycheck stopping.


Auto $27,578 ($19,729 outlay net of trade for new VW)
Utilities/cellular $10,232 (two homes)
Property taxes $7,137 (two homes)
Boat/slip $12,409
Property Maintenance/furnishings/improvements $30,115
Clothing $3,400
Entertainment/travel $11,364
Groceries $12,566
Restaurants $7,285
Spirits $3,082
Gifts/Charity $8,065
Health/fitness $998
Medical $6,997
Personal care $2,911
Pets $5,384
Wedding $16,455
Daughter launching $42,927 ($37,000 of this is a loan)
Total $208,905 or $171,905 if the loan is deducted from spending.


This would be closer to $110,000 taking all of the lumpy expenses out. I suppose there's always going to be lumpy expenses, hopefully smaller lumps though.

 

[TravelAddicted]

My first post from Texas. I found this forum when looking for ways to help my DH ER. We are mid-fifty-somethings, empty nesters and still help our DD on occasion since the Fulbright Commission doesn't pay much. This thread speaks to me since I track our spending on Mint, so I am jumping right in with our 2017 expenses.

Husband is still employed, and we do fully fund retirement accounts and HSA. Employer pays most of our HDHP premiums; I am not including here.

Property Taxes $8,886
HOA Dues 1,510
Other home repairs, insurance, stuff 3,016
Travel 16,990
Grocery Store 7,189
Restaurants 6,017
Medical/health/dental 4115
Husband's running addiction 1,038
Pool/gym 479
Gifts/Donations 5,656
Auto Gas/Repairs/Insurance 4,257
Utilities Phones/Internet/Home 4,124
Clothing 2,008
Hair 467
Life Insurance 904
Umbrella Policy 148
Laundry/Drycleaning 314
Season Football Tix 875
Other misc 2,044

TOTAL $70,037

Nice to meet all of you!

 

[tmm99]

My total expense for 2017 was lower than my planned spending by about 26% mostly due to not spending the travel budget very much (This year's travel was already arranged the year before.) and not spending as much on living expenses (groceries/entertainment, etc) The total WR including the taxes I paid this year is about 2.57% of the initial WR when I retired over 2 years ago. The WR is lower if I use the current NW number since my NW has increased since my retirement.

If the USD:CAD becomes unfavorable, my WR will be much higher. For now, I will be socking away some of the unspent money for a possible less-favorable future.