2014 In Review: Spending

Now, let’s talk expenses. I spent $48,018 when everything was tallied up this year. I gave a small gift to my sibling to help out with something and I don’t count that in my spending. It certainly puts things into perspective the fact that I can’t even tell by looking at my net worth which month I did that.

2014 Spending

This pie chart looks pretty similar to 2013’s version, except that travel is a much bigger chunk of the pie. In my 2013 year in review, I talked about what I thought my 2014 spending/savings might look like. Let’s check in with that:

1) My boyfriend and I are working on a system to split some expenses more so than randomly because we’re working on incurring more shared expenses than we had this year. For now, the plan is to make it easy to transfer money between each other’s accounts since we use the same credit union for our primary checking accounts.

SUCCESS! We set up the transfers between each other’s accounts and near the end of the year, we set up a joint account that we’ve slowly started using. For now, we’re just using it for groceries. We’ve also talked about getting a joint credit card at some point.

2) I plan to contribute more to charity in 2014 than I did in 2013. The plan involves getting my donations up to 1% of my gross income, including my bonuses. I have a few annual contributions set up and will continue to donate to the random causes that my friends participate in. When my bonuses post, I will transfer 1% of the gross amount to my checking account, add that amount to the donations budget and then figure out where to go from there.

SUCCESS! I’m calling this a success because even though I only donated $30 more in 2014 than I did in 2013, I set aside the 1% of my gross income from every paycheck and bonus and the reason why it’s under is because I’m going to make a big donation in January 2015 and I wanted to have the money set aside for that. Near the end of the year, I moved the balance of this budget item to a savings account at my credit union in an attempt to separate it from my normal spending plan.

3) Overall insurance costs should be about $1,000 cheaper in 2014 because I had been paying monthly through July 2013 and then paid for a full year in August.

SUCCESS! In 2013, I spent $2,670.67 on insurance (auto, condo, and umbrella). I spent ~$1,800 on the same policies in 2014, a savings of ~$900. The new company raised my auto policy rate in 2014 by a decent chunk that I will probably try to shop around again in 2015.

4) I think that I will spend less on electricity. I spent about $700 in 2013. I’m hopeful that I can get that figure down to around $440 for the year, but we will see how things play out!

PASS! The average in 2014 was 0.33 kWh/day more than in 2013. I hadn’t planned on my boyfriend moving in this year when I set the goal to reduce electricity costs. All things considered, a 0.33 kWh/day increase for a second person isn’t too bad. I’m hopeful that with some of our new energy saving light bulbs, we should not increase our electricity consumption in 2015.

5) HOA dues went up a small amount for 2014. I have been budgeting for property taxes to go up about 3% per year, but it looks like my property value went up by much more than that for 2014 and so I’m guessing that they will go up by closer to 20%, putting those two items at about an increase of $800 in 2014. I don’t have much control over those items without moving though.

These two items ended up going up by about $700 in 2014. It looks like my property taxes may go up an additional 20% in 2015, which I’ve budgeted for since they sent me a notice with my new assessment value for the 2015 tax year a few months ago.

6) I think that I will spend less on my household goods and toiletries items because there were a lot of cleaning products and different items that I stocked up on that should last for a long time – I shouldn’t have to re-buy very many of those items.

SUCCESS! This was accurate on household goods. I spent $342.23 in 2013 and only $197.10 in 2014, a savings of about $145.13. I spent $347.89 on toiletries in 2013 and only an additional $24.87 in 2014 of $399.76. That’s not bad.

7) I will spend around $400 more on recreation in 2014.

SUCCESS! I spent $882.01 on recreation in 2013 and only an additional $97.43 in 2014 to $979.44. Looks like I underspent on recreation! This is definitely true – I didn’t exercise nearly enough in 2014.

8) I will probably spend around $1,500 less on shopping in 2014- fewer condo projects.

FAIL! I spent $3,538.94 on shopping in 2013 and $3,383.68 in 2014. So yes, I spent less, but not $1,500 less like I had predicted. Where did all of the shopping money go this year?

  • $1,666.59 painting and second half of closet install
  • $411.38 small furnishings: picture frames, a pizza stone, a nice knife and some other kitchen things, new sheets, artwork, a temporary desk, and some wood swatches
  • $354.37 a new camera
  • $301.59 small electronics: batteries, a new router, a speaker
  • $267.54 fixing my laptop (includes shipping costs)
  • $141.07 plants and a container
  • $123.69 three hats and a scarf
  • $108.13 new thermostats
  • $20.22 a case for my cell phone

9) I will spend a lot less on taxis and nothing on tolls.

PASS! I spent $52.83 on tolls in 2013 and only $30.00 in 2014. I spent $259.25 on taxis in 2013 and only $63.85 in 2014. Since I own our one car and pay for that, my boyfriend tends to pay for taxis when we’re going somewhere together.

10) I will increase my overall savings rate to 85%.

FAIL! Hah! This would have required my income to be in the higher end of my estimate and to have spent much less.

11) My current forecast is about $38,500 in spending in 2014, which would be about a $7,000 reduction from 2013.

FAIL! Hah! I spent $48,000 or about 25% more than my forecast. Oops! It was a good year though :)

Comparing 2014 to 2013:

  • I spent $619 more on housing (internet, condo insurance, electricity, HOA dues, household goods, mortgage loan fees, property taxes, required mortgage payments).
  • I spent basically the same amount on clothing/shoes (~$1,900) and personal care (~$800 on hair cuts, eyebrow waxes, toiletries, and make-up).
  • I spent $697 less on entertainment in 2014 than in 2013, for a total 2014 cost of ~$2,500.
  • I spent $109 less on eating out by myself in 2014 than in 2013 (almost all of my eating out these days is with my boyfriend or with friends rather than by myself).
  • I spent $354 more on groceries, which was to be expected since I’m eating out a lot less and we also cook meat a lot more at home than I was on my own. This amount is less than the decrease in entertainment and eating out though and still under $200/month so I think this is fine.
  • I spent $863 more on work lunches since I didn’t take my lunch very much in 2014, for a total 2014 cost of ~$1,800.
  • I spent $637 more on presents.
  • I spent $671 less on health (medical, dental, and vision) than in 2013. I estimate I’ll spend even less in 2015 since my premiums are lower with the new job.
  • I spent $155 less on shopping.
  • I spent $1,448 less on transportation.
  • I spent $3,082 more on travel – a whopping $7,558.45 on travel in 2014!
  • Overall, I spent $2,736 more in 2014 than in 2013.

Where would I say my $9,500 over my spending goal went?

  • $3,558 to travel (a $900 bachelorette party for a friend and our upcoming month-long trip to New Zealand)
  • $1,344 in unplanned shopping spending
  • $907 of unplanned medical/dental/vision spending (partially an increase in premiums)
  • $1,094 in unplanned clothing spending
  • $1,026 in unplanned food spending
  • $229 in unplanned personal care spending
  • $1,338 in other miscellaneous unplanned spending that I’m too lazy to research since my budgeting isn’t really that thorough

Basically, I spent the exact same as I did in 2013, plus I spent an extra $3,000 on travel. Lifestyle deflation is apparently really hard and I think I should try to make fewer sweeping lifestyle deflation changes going forward. I was too optimistic for my spending in 2014! I recognize that $48,000 is a large sum of money to support just one person. I try to instead remind myself of the fact that I saved 68% of my net income in 2014 and to evaluate whether I enjoyed the purchases I made throughout the year and so long as I did, then my spending is fine. I also don’t want to regret not going to a friend’s wedding because I thought the price was too high to go.

How do I think my spending in 2015 will be different than 2014?

  1. I will spend $3,035 less on housing with my boyfriend moving in. I don’t know what the property tax bill will look like yet, but I’ve estimated for a 20% increase. There’s also a small special assessment due. I justify not caring about this by how much cheaper owning is than renting (~$14k to own my two bedroom condo last year versus ~$39k to rent a similar place).
  2. I am planning to spend less on clothing, but who knows how that’ll actually end up going.
  3. I think I’ll spend about the same on entertainment, dining out, and personal care.
  4. We’ve each set up automatic transfers for $200/month to the joint account to cover groceries. I’m reasonably sure this will be sufficient, but it may be more than we need.
  5. I’ve estimated to spend about the same in 2015 on work lunches, but I’m going to see how the new job goes, how much the cafeteria costs, and then see if I can reduce this at all.
  6. I estimated in my budget that I’ll spend less on recreation. My new employer will cover a certain amount of fitness related expenses. I haven’t decided whether I’ll count the funds as income or a reduction in spending. If it’s taxable income, I’ll probably count it is a income. That’ll affect what this category looks like this year.
  7. I’ve estimated only $500 for shopping compared to 2014’s $3,400.
  8. I estimate spending about $400 more on transportation. Hopefully that’s not the case and car insurance will go down!
  9. I’ll spend about $500 less on travel.
  10. Overall, I plan to spend about $9,200 less in 2015 than in 2014: 33% of that is housing, 10% clothing, 13% health, and 31% shopping.

Readers, how was your 2014 spending?

Advertisements

13 thoughts on “2014 In Review: Spending

    • We were thinking it might make some things easier to split? I don’t know. We haven’t decided to do that yet, just thinking about it. The joint checking account is working quite nicely for groceries, much better than our previous method of each of us paying randomly. The joint credit card might be nice for not having split costs paid for in a variety of different ways. We’re figuring these things out as we go.

      The joint credit card would be helpful for shared trips. For example, our trip to New Zealand, we’ve been keeping a spreadsheet with the costs already paid and transferring money around as things are paid for and then the plan is to put all the costs during the trip on one credit card and figure it out when we get back.

      • Maybe that’s why my parents have it. They have sort of a “his, hers, and ours” system going. Whereas DH and I have a joint pool with him getting an allowance. We have separate credit cards, but I pay them both each month out of our joint savings.

        I do like having a separate credit history from my husband’s. Not that that probably matters these days.

        • Slowly joining finances in some form or another when you’re both already established results in a “his, hers, and ours” system. I’m really curious to see how our systems will evolve.

          He added me as an AU on a new card he got recently and our intention had been to use it for joint spending, but Chase won’t give me online banking access, so I refuse to use it for joint spending. I want a jointly owned one that we can both see if we’re going to use one for joint spending. Oh yeah and then that card showed up on my credit report. It seems to have not affected my score at all, but WTF Chase!

        • That’s a good point– my parents got married in their 30s (or close to 30s in my mother’s case)… My husband and I got married at 22! There wasn’t anything to slowly combine.

    • Joint cc’s make life easier for us. Fewer balances to pay, plus we can both make returns for the other without receipts. But there’s no his/hers to our money, so no need to separate it if that’s part of the reason to have separate accounts.

      • We’re really enjoying using the joint checking account to pay for groceries. We’ve also been known to borrow the other person’s credit card for returns or to buy gas for whoever’s turn it is. I definitely am with N&M that making sure you have separate credit history of some form from your spouse is a good idea.

  1. Interesting. I’ve always been amazed at your level of detail in tracking expenses. I think it was you who motivated me to track not only my monthly electric bill, but to track even the kwh a month!

    The only problem I see is the bf increasing your kwh by .33 daily. This is just unacceptable. I would get a hold of this before it becomes a real problem. I mean, what if it goes up to .41 kwh a day? Be careful! :-) I hope the playful nature of my comment is obvious.

    Safe travels on your upcoming trip.

    • :) I am an incredibly detail-oriented person. This is much less detailed than my personal report. I have a pie chart for where all of my clothing spending went, broken down by the type of clothing (athletic wear, bottoms, bras, dry cleaning, dresses, jewelry, outerwear, pyjamas, shoes, socks, swimwear, tops, and underwear).

      54% of my entertainment spending for the year was on date nights (I have a pie chart for that too). I also have a pie chart for presents by receipient, where all of my housing money went (spoiler: most of it was the mortgage) and personal care (surprisingly ~1/3 of the spending was on hair products and $1.10 was spent on loofahs).

      Some of my spending is elevated because it’s stuff I’ve paid for for both of us (dry cleaning) and some of my spending is lower than reality because my boyfriend paid for something or toiletries got lumped into groceries since that’s easier to just count all splittable household stuff as groceries. Other than that, I can tell you down to the penny what I’ve spent on pretty much anything going back to mid-2004.

      It’s funny that I motivated you to track your monthly electric bill! I was motivated to do that by the year-over-year chart my electricity utility gives me with my bill and the fact that they only do it for two years. I’ve been in this place long enough that year-over-year hides old data! So it’s nice to have my own charts. I’m curious to see how our electricity usage goes in 2015 – we have even more electronics now than I did by myself and I thought I had a lot!

  2. I wouldn’t worry too much about your spending. I mean, nearly half of it was housing costs in a high COL area which will go down tremendously once you pay off your mortgage. That leaves only around $27K of which $7K is super exciting travel and $5K on food (both, of course, areas near and dear to my own heart where spending is fully justified). And sure, maybe you could save a couple thousand dollars shopping less or whatever, but at the same time your savings rate is sky high so the little indulgences you allow yourself can’t be hurting you that much.

    • My mortgage isn’t quite as high as you think it is, but I get your point ;) Of the $48k, $12.3k was my mortgage. $3.6k was HOA dues that my boyfriend is now paying for. I figure that so long as we’re not upgrading to an expensive house, my expenses are mostly fine. If all that shopping was stuff I never used, that’s another story, but I’ve used pretty much everything I bought last year.

      It’s definitely taken me a reasonable amount of effort to come to terms with the amount of money I make and have at my age. At the very least, I’ve been mostly consistent in spending an average of $45k/year in my five years post-college, so I’m not really increasing my lifestyle much and thank goodness we’re not renting or housing would be even more!

  3. Lifestyle deflation is definitely harder than just preventing lifestyle inflation. =) We get used to nice things and convenience and want more of it!

    I wonder if you’ll realize even more economies of scale as you and the bf live together longer or integrate finances more fully. Stuff like family discounts to the gym, sharing cell phone plans, etc. Not as huge as sharing rent, but it adds up!

    • The little things are definitely nice as well. I’m curious to see how those add up going forward, but we’re already seeing some of them.

      * Sharing internet and electricity is nice! We have super fast internet (~100 Mbps) and my half is only $33 which is what I used to pay for 20 Mbps of internet.
      * And the dreaded January electricity bill that’s usually ~$240 is now only ~$120! :D
      * I’ve never seen family discounts for gyms around here, but I just found one that does have a family price :)
      * My cell phone has been paid for by Ting referral credits from this blog for almost two years now (that’s the only money I “make” off the blog at all) and my boyfriend’s is paid for by his work and it’s a cheap prepaid one anyways.
      * I think we’re definitely getting the benefit of shared groceries since we’re spending each about what we were before, but we’re getting better meals out of it. We can buy larger quantities of items without worrying about them going bad before we finish them.
      * We also only have one Amazon Prime plan, one Netflix account, etc. though I didn’t have either of those myself when we started dating. I acquired myself my own Netflix profile on the account pretty quickly after watching one too many romcoms on my boyfriend’s Netflix while he was gone at Christmas :D
      * We will probably join insurance policies at some point, but that would limit which companies we can go with so long as we are unmarried, so I’d rather hold off on that.

Comments are closed.