Words are all well and good. But without numbers, how much do they really mean? I’ve decided that in order to make this blog as valuable as possible for readers, I need to make it specific. As such, I’m going to give you a very intimate look at an important element of my personal finances. In particular, I’m going to show you what I spend on EVERYTHING. Obviously this is all specific to me, but to illustrate things more vividly, I’m going to go into detail on each of these “line items,” one post per week. Hopefully it will give some folks an idea or two on how to cut expenses without sacrificing anything that’s important to them.
Before I jump into the numbers, here is some basic information about me for context. I’m a male in my early thirties with no dependents (not even pets) and while I spend my share of time with certain young ladies, I live alone. The numbers below are average figures between what I spent in 2017 and 2018. In 2017, I lived in an upper middle class Milwaukee suburb with a relatively moderate cost of living. But for most of 2018, I lived in the Galleria area of Houston, which is pricier than almost anywhere in Wisconsin, but still very reasonable for a wealthy part of a major city.
I work as an outside sales rep in the commercial finance industry. That affects a couple of areas of my spending. First, since I expense around half a dozen restaurant meals most weeks, I don’t have much desire to eat at restaurants in my personal life and as a result, I spend almost nothing in that category. This also cuts down on my grocery spending somewhat, although I like to cook and spend fairly liberally on groceries for the meals I do buy. Second, in spite of my employer’s generous vacation policy, actually taking advantage of it would cost me much more in income than in any other way. Plus, I travel a lot for work, resulting in general travel fatigue, and I’m single. So this is just not an area I spend much in. However, I consider both restaurants and vacations luxury spending categories and thus, if one were trying to live as economically efficiently as possible, these numbers would still be very low.
As I said above, I’ll get more specific about what I do in each area in subsequent posts. But in general, my lifestyle (note, I said lifestyle, not spending; the difference between the two is the foundation of my financial success) is somewhere between middle class and upper middle class and I save over half my gross income. In other words, there is plenty of fat in my expenses since I pretty much do whatever makes me happy. No economic constraints limit my spending besides my desire to increase my net worth rapidly.
The first number in each category is what I actually spent; the second is about what I would spend if I needed to live as economically as reasonably possible. I will note that the most advantaged living situation is two productive people under one roof, assuming they can trust one another and are on the same page financially. When I lived with my ex-wife and we were working on paying off a mountain of student loans, we spent more than my bare bones total figure below but didn’t come anywhere close to doubling it (keep in mind the figure is for one person, not two). So it is definitely realistically achievable. If you are astute, you will notice that I’ve omitted one very large expense: taxes and fees. In the interest of keeping things at least somewhat private, I’ve decided to leave that exact figure out, at least for now. I’ll simply tell you it is less than the total of all my other expenses but not by much. Plus, there is only so much one can do to limit that number when the majority of your income is W2. I’ve been investing more of my time into improving that situation and if I find success, I may post about it at a later date. Anyway, here we go!
My Average Annual Expenses Between 2017 and 2018
- Auto maintenance/repairs: 1300 (500)
- Cash donations: 2100 (subjective)
- Clothing: 700 (100)
- Food – groceries: 1700 (1200)
- Food – restaurants: 500 (0)
- Fun: 2100 (300)
- Gas: 2800 (1200)
- Gifts: 1200 (200)
- Household expenses: 700 (300)
- Housing: 12,600 (6000-10,000)
- Insurance: 3000 (2000)
- Medical: 900 (0)
- Memberships: 300 (300)
- Other: 2400 (0)
- Supplements: 100 (0)
- Technology services: 500 (350)
- Utilities: 1100 (600)
- Vacation: 300 (0)
- Vehicle depreciation: 2100 (500)
Total: 36,400 (13,550-17,550)
How did I arrive at these numbers? And why the range in the housing category for the minimalist budget? You’re just going to have to stay tuned to find out…