2015 Spending

ExpensesI know this post is a little late in coming, but better late than never right? Now that 2015 is in our rear view mirror it’s time to see how our spending went for the year.

We didn’t start tracking our expenses in detail until February of 2015, so I’m just going to use the average of the other 11 months to represent January.

As you know, we bought a house in 2015. I’m going to include the expenses related to getting the mortgage (things like closing costs and inspection fees), but I’m not going to include the down payment.  Since the down payment counts as equity in the house, I’m counting it more on the “investment” side of the balance sheet.

Without further ado, here are our numbers from 2015:

Total amount spent: $34,476

Average spent per month: $2,873

Those numbers are pretty spendy for us, but they’re fine considering we increased our net worth by about $80,000 last year, not even counting the ~$13,000 in equity we put in our house.

Our definition of financial independence is $600,000 in liquid investments and a paid off house.  That amounts to $24,000 a year using a 4% withdrawal rate (which is based on the Trinity study).  You don’t have to be the sharpest tool in the shed to realize that we spent more than that (by quite a bit) in 2015.

However, we also visited Portland Oregon (twice!), spent 24 days in Belize, had a few months of double rent while transitioning to the new abode, paid off the balance on my student loans, and had a few thousand in expenses related to buying our house.  Also, the $24,000/yr assumes we don’t have a mortgage payment, which we certainly did in 2015.

Of course, if we continue to spend this much every year, we will have to adjust our FI assumptions, which is why it’s super important to track your spending.

Since I love these types of details on other blogs, below I’ve included a monthly average for each spending category (rounded to the nearest dollar):

Housing (rent and mortgage): $945

Groceries: $412

Utilities: $196

Cell Phones: $46

Netflix: $9

Gym: $8

Restaurants/Bars: $ 148

Insurances: $64

Gas: $40

Home Improvement: $204

Travel: $375

Healthcare: $26

Hobbies: $23

Gifts/Charity: $27

Education: $14

Goblins: $193

If you add all those up, you might realize that it doesn’t add up the monthly average above because I’ve excluded the mortgage expenses and one-time loan payments we had at the beginning of 2015.  It just doesn’t make sense to list them as monthly averages.

Looking at these numbers a couple of things jump out at me.

  • Our mortgage payment plus home improvements is less than we were paying in rent before buying the house.  Plus we are building equity.  I like that. 🙂
  • We like to travel. It’s one of the places we don’t mind spending extra money and that definitely shows up in this breakdown. While almost $400/mo seems a little high, it’s nice to see that our spending matches what we think is important.
  • The goblins category is too high.  Goblins is basically a catch-all which means the money there didn’t really get tracked.  If you read the expense posts from last year, I got a lot better at accounting for every dollar as the year progressed.  Hopefully next year this category will be a lot smaller because I really don’t like spending $193/mo on random stuff.  That’s way too high.
  • The food spending (groceries + rest/bars) was pretty high, but not outrageous.  We could definitely improve in this area, but most of the eating out expenses came during travel.  Not great, but not terrible either.

There you have it.  Our 2015 spending laid bare!

How do you think we did? Does anything jump out at you from looking at the monthly breakdowns?

The Hoard: February 2016
Expenses: February 2016

4 thoughts on “2015 Spending

  1. Goblins…. Great idea to track the untrackable in that way.

    As we have a fun money budget, a lot of our spending falls in the Goblin category. For us, it works, as we have a pre-defined amount of money we want to save/invest.

  2. Re: the goblins. Can you break them out into categories, instead of just lumping them together like a junk pile?

    I found the “miscellaneous” category to be the final bastion of heedless spending in my household budget. Once I separated everything out, and crafted new categories when I needed them, it got much easier to deal with the leakages.

    The leakage is back, in a sense, now that I’ve got a separate “discretionary” category for my wife, who resists the tracking but otherwise stays within budget on the whole. That’s a price I’m willing to pay for domestic tranquility.

    • What you are suggesting is essentially exactly what happened throughout the year. In each passing month expenses that might have been lumped into the goblins category got broken out into their own categories. Things like hobbies and entertainment got broken out separately, etc. And, hey, as long as “discretionary” has it’s own budget line it’s not really leakage right? Domestic tranquility is priceless. 🙂

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The Hoard: February 2016

Every good dragon has a hoard.  You know.  The collection of gold, jewels, and other valuables that the dragon guards...