2019 Spending Summary and Analysis

[GravitySucks]

$5k more than 2018 which is pretty cool since I had to put on a new roof, gutters, tree service and fencing of about $16k.
That doesn't count the used Miata, that $$ came from selling the RV in 2018.

Withdrawls were 88% of my safe max.

 

[Lawrencewendall]

72k for 2019, not counting taxes. Empty nesters in the Baltimore/Washington corridor.

 

[Golden sunsets]

I can see that it is and it isn't. I don't include car purchases and such in in spending... but they are obviously withdrawals.

I view spending as normal recurring expenses of the lifestyle to which we have been accustomed.

But at the same time, that lifestyle includes replacing our cars every 5 years or so. So what to do?

I depreciate our boats and cars in Quicken and considered that depreciation as spending when I assessed whether we had enough rather than providing for a big lump every 5 years and that depreciation is included in my spending.

I think both ways of looking at this have merit. The way that we handle this conundrum is to view 1) core living expenses, 2) federal and state taxes, and 3) lumpy expenses, as three separate comparisons. By handling it this way, we can compare our core expenses (or perhaps "regular" is a better word) from year to year, to get a side by side comparison. Then federal and state taxes as a separate category and finally lumpy(or non regular expenses) as a final line item. Regular expenses are inclusive of all the normal frills, like travel and entertainment. Federal and State taxes have varied for us as we have defined benefit plans and then DH first started RMD's, then SS for each of us in different years and then RMD's for the second of us. So we really need to view our spending exclusive of taxes. And the lumpy category varies wildly from year to year and includes things like weddings, major gifting to children, major home improvement costs and for us in 2020 a new vehicle purchase to replace a 10 year old vehicle that we are gifting to DD, so no trade in value. And we quite pamper ourselves with our autos as we keep them for so long, the extra cost when spread out over a 10 year period is minimal.

Viewing these three spending buckets separately, our core/regular expenses have been surprisingly constant over the past 5 years at between $100,000 and $116,000 per year. Once we add taxes and then lumpies, the number is quite large, but then we are blessed with two cola'd pensions and two SS's, so our SWR for 2019 was a paltry .25%. Next year I expect our SWR to be 1.2%.

 

[DrRoy]

Spending was up 18% over '18, including $34K for 14 weeks of travel, and another $11K for the Viking cruise this year. Due to the great market last year, we are prepared for 20-25% more this year, to include some modest remodeling in the house and a major deck project.

 

[marko]

For the two of us here are the big ones:
Weekly spending/allowance $20K (covers gas, groceries and misc)
2 Car leases $14.5K
Health Ins $16K DW only
Dining out $10.4K
Prop taxes $12K
Travel $22K
Boat maintenance/storage $11K
Fed/State taxes $30K
Handouts to layabout neice/nephews $10K

Top nine total: 146K
Total spending: $170K

 

[scrabbler1]

I usually split out my spending into 3 broad but roughly equal categories (before creating sub-categories): Housing, Medical, and Everything Else. But for 2019, the Everything Else category has a spike due to income taxes spiking from the late December liquidation of a stock mutual fund (and then buying into a comparable index fund) which had been pushing me over the ACA subsidy cliff the last 3 years. I had to realize a $50k cap gain on top of a $20k cap gains distribution. While this will cost me about $10k in added income taxes, I will get most of it back in 2020 thanks to a lower tax bill and qualifying for an ACA premium subsidy of $5k, both of which will save me money in future years.


Excluding the extra income taxes, my spending remains in the $25k-$29k range (one person).

 

[RonBoyd]

Shouldn't this thread have a Poll function?

 

[mrfeh]

Not gonna bother posting details, but our total spend for the year (family of 3) was $53K.

Of that, $37K is what I consider core expenses (expenses that I know will occur every year).

 

[Toocold]

I use personal capital to keep track of our spending, and it was 91k last year. The three biggest categories are: general merchandise (target, amazon, sam's club), travel, and groceries/restaurants. This makes sense given that we have a paid off house and cars.

How do people go about breakdown target, amazon, sam's club, costco spend, given that it's a hodgepodge of stuff?

 

[Gumby]

Not counting income taxes, we spent $136k in 2019, although $36k of that was buying a new car for cash, which I don't anticipate doing again anytime soon, if ever.

Our anticipated spending for 2020 is $99k. (my predictions are usually accurate to within +/- $1k). Almost a quarter of that is for travel.

 

[mrfeh]

How do people go about breakdown target, amazon, sam's club, costco spend, given that it's a hodgepodge of stuff?

We use mint. For such debits, we manually categorize them, which is easy to do if you review them every few days.

 

[Lawrencewendall]

I use personal capital to keep track of our spending, and it was 91k last year. The three biggest categories are: general merchandise (target, amazon, sam's club), travel, and groceries/restaurants. This makes sense given that we have a paid off house and cars.

How do people go about breakdown target, amazon, sam's club, costco spend, given that it's a hodgepodge of stuff?

I use AceMoney and download transactions about once a week. It's pretty good about categorizing spending but I still review them to make sure they are accurate while the purchases are still fresh in my mind.

 

[Gumby]

I use personal capital to keep track of our spending, and it was 91k last year. The three biggest categories are: general merchandise (target, amazon, sam's club), travel, and groceries/restaurants. This makes sense given that we have a paid off house and cars.

How do people go about breakdown target, amazon, sam's club, costco spend, given that it's a hodgepodge of stuff?

I run virtually all my spending through a single credit card. When the monthly statement comes, I go through each entry, assign it to a category and set it out on a scratch pad. I sum the amounts in each category and then put the total in my spreadsheet.

Most of the items are self evident from the place where the charge was made - like a charge at the gas station or a restaurant or the pet food store. As for those stores where it may not immediately obvious, I can usually remember what I bought since last month. I also usually tend to buy certain things at certain stores. For example, I only ever buy shooting supplies at Cabelas. And sometimes, but not always, I have saved the receipt in a basket. For things we bought on Amazon (which is a lot), I pull up my order history online and categorize from that. One shortcut I also use is to classify anything bought at a grocery store or the drug store as groceries.

 

[RonBoyd]

How do people go about breakdown target, amazon, sam's club, costco spend, given that it's a hodgepodge of stuff?

You probably don't want to hear this but... the only way I have found to do it is manually. You can, of course, take the Credit Card's WAG or one's memory but neither is very reliable. I use Moneydance.

 

[street]

If I may ask to the ones itemizing every penny and categorizing to a specific account, why?
Not a criticism to you or what your method is, but how do you use that info each year and do you change what you are doing when you see the results?
My dad did this type of bookkeeping and I beleive, he did it more from habit and for fun to see where money went.

 

[ckelly78z]

This year is going to be a saving year with less big expenditures (no more DD weddings or DS college expenses). We also eliminated some of our cable options, and will be saving $100 a month for something neither of us watched much. My daughter's expenses look better also, so they can resume payments for the diesel truck/camper we sold them last year before the wedding.

By Dec 2020, we plan to have no outstanding debt, and be able to make a clear budget with no kids remaining under our roof. My DW wants to work 2020, and 2021, so 2021 will be a -H U G E- saving year hopefully.

 

[Nemo2]

If I may ask to the ones itemizing every penny and categorizing to a specific account, why?
Not a criticism to you or what your method is, but how do you use that info each year and do you change what you are doing when you see the results?

You must've read what passes for my mind......I was wondering if someone spends X+1 on food this year and considers it too much, will they attempt to spend X or X-1 next year?

 

[kgtest]

I only care about the categories that are increasing in 2020, and the WHY they are...

Mortgage - I refi'd from 30 to 15 in '19 so the payment is bigger
PropTaxes - They get you one way or another, record levy passed for the district in '19
Gas/Elec - I am budgeting for a colder winter, and hotter summer...global warming and such
Water - The Util Co raised the rate slightly
Trash - The Trash Co raised the rate slightly
Medical - Our premium went up, DW is pregnant and delivery costs ~$6k
Formula - New Baby
Diapers - New Baby
Daycare - Rates stayed same but 3 kids now

All other costs projected to go down, even food *eat out less, we are swapping one BIG vacation this year for a local water park trip instead and travel costs will be low as our other 2 lodging is paid for us.


I projected my inflation rate was around 1.5 to 2% for this year. There is always wiggle room and categories I could cut back if needed.

 

[Gumby]

I still track and categorize my spending mainly because I have done it for about 20 years. We don't really budget per se. We spend what we want. But it does keep me mindful of how we spend our money and suggests areas where we could be more efficient.

For example, I noted that in 2019 our cable TV bill exceeded both our natural gas and electric bills. So I asked the young wife what she watches on TV (I don't watch at all) and the vast majority of it is Netflix or Amazon Prime. I did a little research, just bought an OTA antenna and will stop cable once I'm sure we can get adequate reception. I'm waiting for a nice day to go up on the roof.

 

[kgtest]

How do people go about breakdown target, amazon, sam's club, costco spend, given that it's a hodgepodge of stuff?

I lump it together in a best estimate. This is our wiggle room category. Groceries are easy for me to guess, we spend $70-100 weekly... all the one off target, home depot trips etc it's tougher.

For me the equation is NetPay - KnownExpense = UnknownExpense... then I look at that Unkown Expense # and know hey, I have more, or less available than the prior years Unknown Expenses. This only works well in accumulation and most large expenses can be understood prior to them occuring. IE there are RARELY surprise expenses over the 5 to 10k mark...unless you are extremely unlucky (surprise doc bills, bail, litigation).

 

[MrsHaloFIRE]

[
How do people go about breakdown target, amazon, sam's club, costco spend, given that it's a hodgepodge of stuff?[/QUOTE]


I break down amazon by item and type of expense. $18.99 gift. $32 clothing. $100 pool supplies.

Sam's for us is almost 100pct groceries. Wal-Mart I might split into 2 categories. $100 Wal-Mart. Becomes $60 household maint. $40 grooming (toiletries)

 

[SumDay]

We (I) use Quicken, and the Split Category option comes in handy for Costo trips where you may buy a block of cheese, a bag of dog food and an air purifier. I'm on Quicken daily, and while I may not split such shopping trips to the penny, it's a good approximation.

Quicken tells me we spent $136,061 during our first full year of retirement, which includes taxes. This is significantly more than we spent while working, but still under our SWR. Pension and SS are about 40% of our incoming $.

Here's a rough breakdown
Taxes (Fed, State & Property) - 19%
Insurance (LTC, my Retiree Med, DH's Medicare, Cars, Home, Umbrella) 10%
Medical (Dental, Vision, Copays, Rx, HSA contribution) 6%
House (Mortgage, HOA) 7%
Household (New HVAC, Sump pump, water heater & garage door opener along with other general household upkeep) 16%
Charity 5%
Utilities 6%
Travel 5%
Gifts Given 4%
Groceries 5%
Eating out 3%
Allowances 6%
All other categories come in under 3% and aren't worth taking up space

Interesting exercise, thanks for starting this W2R!

 

[jfn111]

I just looked at the aggregate-or and it says we spent $79,000 last year. This included a $10,000 gift to the daughter to help with her kitchen remodel.
We had a 1.9% withdrawal rate and a budget of $6,000 per month so pretty much on track.

 

[corn18]

2019 was epic for us. Made a lot, spent a lot. Analysis shows we blew a lot of dough, but managed the base budget ok. Need to get food and clothes in line and I think we will be ok.

Blow that dough was $85k for travel and the rest was spent on the new house.

 

[Cobra9777]

I use Fidelity Full View, which automatically accumulates and categorizes all of our spending transactions. Only effort by me is to scroll through, validate everything, and correct a category occasionally, which I usually do every 3-4 days.

Spending was pretty high in 2019 for DW and myself at $128K. But in our 6th full year of ER, we're finally closing in on the FIRECalc 95% figure. The first few years were quite conservative by comparison at about 25-30% below.

But it was a strange year, spending-wise. No travel at all. Usually travel is the bulk of our discretionary spend. Instead, we bought a 2019 Subaru Forester... our first new car since 2001. We added a bike rack, a rooftop cargo carrier, and went camping at many of our favorite Texas State Parks. I think we hit 6 of them this year, with lots of biking, hiking, and swimming.

Also, we finally took care of a major plumbing repair that we've been deferring forever. We replaced all the slow-leaking, 50-year-old cast iron drain pipes inside the house with PVC. There are two upstairs baths, so lots of plumbing between the two floors. I did some of the demo myself and hired out the rest of the plumbing. We also hired out the rather extensive drywall repair that followed. But I did all the finish trim work, painting, and some minor electrical.

We also finally finished our master bath remodel, which we had stopped about half way in once we realized the severity of the problem with the old cast iron pipes.

Finally, this is also our first year with LARGE Roth conversions, which will drive roughly $20K additional federal tax, although that expense will happen in 2020 so it's not included in the $128K.

For 2020, we've already got some international travel booked and we plan to do even more camping/biking/hiking, which is not expensive at all. We'll take a break from major home renovations except for some minor stuff I have planned for the kitchen and maybe some new lighting fixtures. Also have a new 15" planer picked out for the woodworking shop. Even with higher Roth tax, we should be in the $120-125K range in 2020.

Here's the 2019 tally:

Category​

|$K|
New car|

28​

|2019 Subaru Forester
Plumbing|

9​

|replace all cast iron drain pipes
Drywall|

5​

|repair drywall after plumbing demo
Master Bath|

5​

|finish master bath remodel
One-shots|

47​

|subtotal

Prop tax|

11​

|main house only, excludes rental
Fed tax|

6​

|small Roth conversions
Health ins|

6​

|medical and vision, no dental ins
Other ins|

4​

|auto, home, umbrella, excludes rental
Med OoP|

6​

|deductibles, copays, co-ins, dental, prescript, vision
Utilities|

5​

|electric, water, waste, nat gas
Tech|

3​

|cell phones, internet, streaming, security, cloud
Groceries|

8​

|includes wine and some household supplies
Entertainment|

6​

|sporting events, concerts, movies, eating out
Transport|

5​

|gasoline, car service, tolls, registration, Uber
Other|

21​

|clothes, Amazon, household, pool, gifts, misc
Ongoing|

81​

|subtotal

Total|

128​