2016 Spending

Although I saved a substantial sum in 2016, I definitely overspent in many areas. It was the year of my wedding so even though my parents contributed a sizable sum to the event, I splurged and spent too much on it outside of their contribution. We did a small “mini moon” which also cost something, but in 2017 we will splurge on a bigger international honeymoon. Here is a quick overview of how my spending went into 2016…

Income (after tax and 401k): $112.4k
Spending: $81.2k
(remaining / savings: $31.2k + $18k  (401k) = $49.2k saved)

Auto & Transport: $5.1k
Bills & Utilities: $1.5k
Education: $2.2k
Entertainment: $1.37k
Fees: $443
Food: $11.7k (yikes)
Gifts: $1.67k
Health: $5.4k (not counting insurance)
Home (rent and home things): $17.3k
Personal Care: $4k
Shopping: $14.8k
Wedding: $9.6k
Travel: $6.2k

While saving $49.2k over the year is nothing to shake a stick at, it is sad that I spent $81.2k over the year. Yes, I spent a lot on my wedding and then things related to my wedding that are covered in shopping (dresses to wear to various wedding-related events and such) but the year was rather costly. Luckily I obtained a job with very high income which covered these costs.

This year, I’d like to substantially decrease my expenditures in most areas. I know I say that EVERY year. Here is my 2017 budget that i will try to stick to:

Auto & Transport: $2k (-$3k) — how? walk to train everyday
Bills & Utilities: $2k (+$500) — work no longer covering phone bill
Education: $0k (-$2.2k) — i don’t need to spend money on education
Entertainment: $1k (-$370) — would like to enjoy life before kids!
Fees: $200 (-$243) — cancelled BOA, don’t need more checks
Food: $10k (-$1.7k) — food is the hardest to change, but we will eat out less
Gifts: $1k (-$670) — no planned friends weddings this year except owed $400 gifts
Health: $12k (+$6.6k) — fertility treatments this year will likely be expensive, plus I want a gym membership to lose weight
Home (rent and home things): $20k (+$3k) — new living room furniture and bed plus standard rent, which will go up in may
Personal Care: $2k (-$2k) — this includes my makeup budget so I will significant cut back on that in 2017. Hair cuts, nails, massages for stress relief to help with fertility will add up still. Might be able to get down to $1.5k
Shopping: $5k (-$9.8k) — cut back significantly on buying clothes and other things!
Wedding: $2k (-$7.6k) — have to send tips that we forgot to send out, plus gift for parents
Travel: $10k (+$3.8k) — probably won’t spend all of this, but we want to take a good honeymoon (I have miles and such so it won’t be that bad) and if this is my last year before children I want to travel a bit  if possible.

Budget for 2017 total: $67.2k

This is an interesting exercise. I’d like to spend less than $67.2k this year, of course, but I am budgeting based on the reality that I am not good at being frugal and I tend to spend more money than I should – but still cutting back significantly in areas like shopping and such (somehow I still have nothing to wear ever.) This would increase my annual savings by $14k OR make it possible to take a job where I make $14k less and save the same amount. (The later is more likely unfortunately but good to know.)

I really would like to save $25k more next year, so I have to find ways to cut back. Some is obvious (annual travel even with honeymoon can be $5k not $10k for my half of our travel costs) but then it will get harder. Here is a more frugal budget that is still realistic:

Auto & Transport: $2k 
Bills & Utilities: $2k
Education: $0k
Entertainment: $1k
Fees: $200
Food: $10k
Gifts: $1k
Health – General: $2k
Health – Fertility – $5k (*if the first cheaper fertility treatments work)
Home $17k (no new furniture)
Personal Care: $1k
Shopping: $2k
Wedding: $2k
Travel: $5k

“Frugal” Budget: $50.2k

So even with a nice honeymoon and such I could spend $48.2k, leaving me with $80k in savings, which gets me very close to my $500k goal prior to having kids (if I keep current job or find replacement with same salary.)

My choice now is how hard to do I fight to keep my current job with my current income for the year. If I do that, and I spend my 2017 budget or less, I can save at least $63k next year, adding to $410k and getting to $473k in networth without any investment growth (close to my $500k goal before I give birth to my first child!) So. I feel more and more like I should try to stay and just do my best and see how long I can make it. If I can keep my income at $9.3k a month after taxes for 6 months ($56k) and reduce it to $7k for the last 6 then I’d have $98k income for the year and, well, math obviously gets us to that I’d have $13.8k less savings, or about the $14k that I’m saving by minimizing my splurges in 2017. Or I just find another job that pays the same, but that is very challenging right now and maybe impossible. The only potential thing I could do is find a job that pays less but also covers fertility treatments, so then I would save $10k on that, but that only really helps in the year(s) I need fertility treatments to begin with, and maxes out anyway. Hmm.

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One comment

  1. Looks like you have a very sound plan for the year. Even if expenses down the road (medical) may be hard to estimate. Not too many individuals have their financial goals in order. Good for you.

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