Reviewing Our 2015 Expenses

Tracking what you are spending money on is probably the most important thing you can do to improve your finances if you aren’t doing it already.  I started tracking pretty much every dollar we spent back in 2014 and it’s been eye-opening to say the least.  Our current spending strategy is not based on specific budgets for different categories, but instead we just try to stay conscious whenever we spend money and hold ourselves accountable by reviewing our expenses every month or so.  This combined with paying ourselves first by maxing out each of our 401k accounts (so we never even see a portion of our incomes to start with) has allowed us to stay on track with our goals without too much overhead.  With the help of’s export feature and a big excel sheet I maintain for tracking our finances, this strategy has worked pretty well for us so far.

Looking back over a full year’s worth of expenses makes some big numbers show up in places you might not have expected, but I think it’s an important step towards keeping a handle on future year’s expenses and making sure we’re still on track for our bigger goals.  In the interest of keeping ourselves accountable and setting a baseline to improve on years going forward, we’ve decided to share our expenses with the world.


Opening up this aspect of our finances wasn’t a decision made lightly, but I think we’ll be able to handle whatever comments come up.  What’s funny is that I can imagine reactions all the way from “You live like kings!” to “How do you even enjoy life?” and everything in-between based on what we’ve decided to spend our money on.  At the end of the day, everyone has different goals and desires and decides to spend their money in different ways.

Our number one goal is to just keep improving year after year, and that doesn’t always mean spending less.  Sure, there are a ton of savings opportunities and we’ll do our best to take advantage of them going forward, but it’s really about happiness and enjoying life along the way.  We’d happily spend an extra thousand dollars a year (or more!) if it made our lives significantly better in some way.  Remember, it’s less about the price paid and more about the value gained from every transaction you make.

Alright, that’s enough delaying on my part, let’s get down to where our money went in 2015.

Total 2015 Expenses – $66,674

This is actually really close to the average household in our area (Seattle) which came in at a $64,933 average over 2013 and 2014.  Unfortunately, it’s not really practical to compare this to our own 2014 expense numbers because of all the unique expenses that came with buying a house among other things in the previous year.  This does however set a very reachable goal going forward in which we can try to improve on.  As I’ll explain near the bottom, this overall expense number is a bit higher than our “real” costs because of my conservative accounting practices, so don’t get too caught up on it yet.

The Big 3 – Housing, Food, and Transportation

These three components make up the three biggest categories for the average household across the entire US and it remains mostly true for us.  We’re way ahead of the curve on Transportation, but seem to give it all back when it comes to food.

2015 Housing Expenses – $29,466

  • Mortgage (includes taxes and insurance) – $25,887
  • Maintenance and Improvements – $1,121
  • Utilities (including internet, not including cell phones) – $2,458

This is one the biggest expenses we’re working on right off the bat in 2016.  We recently applied for a refinance to remove PMI AND lower our interest rate which will lower the mortgage number by ~$4,100 per year going forward!  The refinance itself comes with a cost, but the lower payment will make up for it before the year is up and keep paying dividends in the years ahead.

Maintenance and Improvements was mostly us redoing our front yard this year which was more than worth it and we did it all ourselves!  The amount we spent on the yard this year will probably be replaced by an appliance breaking or something else going forward, so I expect this number to stay about the same.

For Utilities, we switched our internet provider away from Comcast (and the shenanigans that required constant attention to keep our rate down) to CenturyLink high-speed DSL.  I was skeptical at first, but the speed and quality has been superb so far and it’s saving us $20/month or so.

Our DIY yard transformation that made our small yard much more conducive to hosting.

2015 Food Expenses – $11,498

  • Groceries – $4,906
  • Eating Out – $6,592

That large number is just for the two of us and brings our daily average to right around $16 per person.  The main reason being that over half of it was from eating out at various fast food and restaurant establishments!  There’s certainly a lot of room to start saving money if we cook more of our own food, but going out to eat is something we enjoy, especially with friends and family.  There’s certainly a middle-ground to be found in here somewhere.

One note is that we don’t bother breaking out food from household goods (paper towels, cleaning supplies, etc.) in the “Groceries” category, so not all $4,906 went towards food.  That might help our $32/day number slightly, but doesn’t change the fact that we’re still spending a lot on food.

2015 Transportation Expenses – $3,155

  • Car Related – $2,632
  • Public Transportation and Ride-Sharing – $523

The “Car Related” category is a pretty much even split between gas, maintenance, and insurance along with a few smaller items like car washes and parking fees.  We’re still keeping Becky’s 1999 Honda CR-V going and have yet to even reach 100k miles on it.  We ditched my car when we moved out to Seattle a couple years ago.  I made the decision to take the bus to work every day and we specifically picked housing that made it convenient for me to do so which has worked out great.  Sticking to one car and using a lot of public transportation has allowed us to come in way under the average on Transportation expenses versus the rest of the area and nation.

The Ride-Sharing part is primarily Uber with a little bit of Lyft and Car2Go thrown in.  I’ve found Uber to be amazing if I need to get to or from somewhere and either don’t have access to our car or don’t want to drive in the first place and it ends up way cheaper than if I had a car of my own after insurance, gas, and everything else.  Plus, we don’t have to worry staying sober if our own personal driver is picking us up at the end of the night!

It’s worth noting that my employer does pay for my bus pass on a monthly basis that would otherwise cost ~$80/month in bus fares.  For the most part, I like to keep expense in terms of financial independence and I won’t be commuting to work if retired, so I’m not worried about including it here.

Other “Necessities” – $3,413

Aside from the big three expenses listed above, there’s only a couple other items that I include under the other necessities.  These of course aren’t absolutely necessary expenses in the strictest of terms, but are ones that I probably wouldn’t try to cut out completely in the event of a financial emergency.

  • Our Dog, Bogey – $1,257
  • Cell Phones – $1,189*
  • Personal Care, Fitness, and Medical – $967

Our pet expense is a bit high because we spent a few hundred dollars on dog-sitting early on this past year.  Since that time, we’ve made some amazing local friends that are willing to watch him for free when we go on trips!  We of course offer to return the favor whenever they might need it.  We also probably buy him way more toys than he needs… But just look at him:

Our corgi, Bogey, is definitely a bit spoiled
Our corgi, Bogey, is definitely a bit spoiled

I added an asterisk to the cell phone part because while we “paid” that much this past year, my employer reimbursed $600 towards the expense because I also use mine for work.  As I mentioned above, I like to keep our expenses in terms of financial independence and while I’ll no longer be commuting to work, I will be using a cell phone after retirement so I include the full expense here.

The Fun Stuff – $19,142

Every spending category up until this point has been fairly necessary.  Certainly not to the extent that we spent on each of them, but it’d be rather difficult to eliminate any of them entirely.  On the other hand, everything in this category could certainly be chopped down to bare bones levels if absolutely necessary.  We don’t plan to do that in the near future, but it’s nice to know what kind of buffer we have if things ever got really tough on us financially.

  • Travel and Vacations – $7,424
  • Entertainment – $2,133
  • Shopping – $1,993
  • Gifts and Charity – $1,723
  • Bars and Alcohol – $1,779
  • Wedding – $3,829
  • Other – $261

Our biggest category here (and our 3rd biggest category overall) was definitely spent on our travels.  The majority (~$4,500) went towards a 7-night Alaskan Cruise and an awesome dog-sledding glacier excursion.  Certainly an amazing experience overall and we love cruising, but we’ll probably hold off for a couple years now that we’re big into travel hacking to get trips for very little cost.  In fact, the rest of the Travel/Vacation total (~$3,000) paid for 8 days in NYC, a few nights in Vegas, several flights home to see family, and MORE.  Not to mention, that same $3k also includes trips booked for 2016 including 4 All-Inclusive Nights in Cancun, a flight to Hawaii, and our 16 day honeymoon to New Zealand and Fiji in which we’ll be flying international business class for the first time!  Needless to say, I don’t think our travel budget will hit $7k+ again for a while.

Dog sledding on top of a glacier in Alaska = best excursion we’ve ever done! Also one of the rare pictures where you’ll find me not in shorts of some kind.

Entertainment is a mix of movies (several free and heavily discounted using these tricks), several sports leagues we participate in, and PAX tickets for 3 people because my brother joined us last year.  I’m fairly happy with how this budget turned out and we’ll probably shoot for a similar number going forward.

Shopping is a healthy mix of clothes, board games, and other miscellaneous items like golf club luggage and a couple video games.  Once again, I think this number is pretty good and we’ll probably end up close in future years.

Gifts and Charity is 90% for other people, we didn’t spend a whole lot on each other this year.  Once again, we’re content with this number and don’t see the need to try lowering it much.

Bars and Alcohol is definitely a bit higher than I expected, but seems to mostly be tied to the fact that those sports leagues I mentioned are the type of leagues where you meet up for drinks both before AND after the games themselves.  Probably some of the most fun we had all year, so no regrets at this point!

The Wedding category is a new one this year with some deposits made and a dress purchased, and will blow up a bit next year as we hold and pay for the actual event.  We debated for a while, but ended up settling on a fairly good sized wedding to bring friends and family together.  The goal is to keep costs somewhat sane while still hosting a good party for a couple hundred people, so we’ll see where the dust settles.  At least the kick-ass honeymoon is mostly covered by miles and points!

Why Our “Actual” Expenses Are A Little Lower

Pretty much everything I track in our personal finances has a little bit of a buffer built in.  This mostly has to do with our goal of financial independence and how it ties to the amount of money we’ll eventually need to accumulate to live off of indefinitely.  That magic FI number is directly tied to our annual costs and I try to keep that in mind whenever I’m totaling up our expenses.  For that reason, the totals are more of a “worst-case” representation of what living the same year over again would cost us.

For example, I don’t count any cashback earned via credit cards against our expenses, but instead treat that money as a sort of “income” on the balance sheet.  So while we earned ~6% back on groceries to the tune of ~$300 this year, I didn’t subtract that out of our grocery expenses.  Along the same lines, assuming a conservative 2% cashback across the rest of our expenses that can be put on a credit card (everything but the mortgage), we essentially reduced our spending another $700 or so!

In addition to simple cash-back on credit cards, we also try to use discount gift cards whenever possible on our day to day purchases.  In 2015, this saved us ~$750!  For tracking our expenses though, I put the amount on the receipt towards our costs, not the adjusted amount based on the discount we got on the gift card.

Another thing I mentioned above is that my employer reimburses us $50/month for cell phone use, so that’s another $600/year that we’re not “actually” spending.

I might be leaving out something else, but I think you get the idea.  The total $66,674 number above is a little bit higher than we actually spent, but a pretty good representation of our past year’s expenses.

Looking Forward to 2016

Oh wait, 2016 is already here!  Anyway, there’s a lot of little optimizations and improvements to our spending that we plan to implement in 2016 to lower our expenses while maintaining or even increasing our happiness!  The first big one, as mentioned above is the refinance of our mortgage.  That’s an easy $4k right off the top going forward without any change in lifestyle!

In addition to the refinance, our 2016 Travel budget will mostly likely come in at under half of the $7k number we put up in 2015 due to some serious miles and point usage.  Despite booking a couple of international trips and spending more nights in hotels compared to 2015, most of the costs were already accounted for in 2015’s expenses.  Of course we’ll probably book some 2017 trips this year, so I guess our expenses may come down to where we decide to head off to next.

I think we’re too many years away from financial independence to lock in any kind of net worth goal, but at our current levels, a cool million and a paid off house would probably have us sitting pretty nicely.  We can’t say how many years it will take us for sure, but I think our goal of FI by 40 is still well on track!

4 thoughts to “Reviewing Our 2015 Expenses”

  1. I didn’t know you were a Seattleite too. Your summary makes me realize just how frugally I live.

    1. I’ve called Seattle home for the past few years since moving over here from the Midwest. Do you ever attend the Tuesday Frequent Traveler Meetups here?

      We’re certainly not the most frugal people, but we’re always working towards improving our spending habits to make sure they line up with what we value most. Lots of room to reduce spend AND increase happiness right now, so we’ll continue to improve. 🙂

      1. I’ve been abroad for the past 8 years though so I haven’t been to any meetups in the area. And when I do get back to Seattle, I usually just hang with family and friends despite actually planning on the meetup. The PNW brings out the lazy in me especially when it’s rainy/overcast.

        Don’t get me wrong, I live frugally, yet still spend on things that aren’t necessary. The evils of having disposable income I guess. And I agree about reducing spending and increasing happiness – in fact, most spending doesn’t result in happiness, especially the eating out part, since the simple stuff I make at home ends up tasting the best. Wife agrees with that one too. 🙂

Comments are closed.