Happy New Year!
In a change from my prior posts, I’m going to share some actual numbers in my financials with you. I normally present the monthly data in percentages for privacy, but I feel that it’s important to share the real numbers with you so you can see just how well I live off a small amount of money.
I’ll be the first to admit that I’m able to get by spending less than the average person for two reasons: 1. I’m single with no kids and 2. My mortgage is paid off, with no other debt owed. But my hope is that you can look at these numbers and still compare them to your spending, factoring those two items in.
My total spending for 2015 amounted to $17,671.11. This total doesn’t include the amount I spent using gift cards or credit card rewards. Adding those in, the total would still be less than $18,000 for the year.
To illustrate how important it is to keep expenses low, I’d be considered financially independent at this level of expenditures once I have $441,778 saved (25x my annual expenses). However, I expect my medical expenses to be higher once I retire and I’d like to create a buffer to account for inflation and any other possible changes in expenses. Because of this, I’m planning to save at least $750,000 (25 × 30,000) before I even consider retirement. The closer to $1M I can get, the better.
My largest expense for 2015 was for groceries and restaurants, totaling $2,898. No surprise there – a girl’s gotta eat. After that, I spent $1,956 on my homeowners association dues, since I live in a townhouse. Next was $1,415 for electronics, which was due to replacing outdated and broken items. Rounding out the four figure category was travel for $1,172. In all other categories, I spent less than $1,000 for the year.
If I lived a more frugal lifestyle and removed the electronics, travel, and restaurant spending, my total for 2015 would be $14,230 . But I’m quite impressed that I’ve been able to live such a great lifestyle while spending under $1,500/month.
What can be improved for 2016
- My home phone line is something I debate keeping. By canceling this, I could save $360/year. Sounds small, but if that was invested over the next 10 years it would amount to around $6,000.
- I love gadgets and new technology but should focus on reigning in this cost. New toys are fun, but the lifespan seems to get shorter with each new generation. All but one purchase in 2015 was to replace broken and/or outdated technology and I’m hoping that I won’t need to replace anything in 2016.
- For a car that’s 7 years old (and was paid off more than 5 years ago), it seems like I pay a lot for car insurance. I have a ton of coverage, though, since I’m a worst-case-scenario type of person. I should probably spend some time pricing out the same coverage with other insurance providers and determining just how much coverage I need.
What I’ll spend more on in 2016
- It might be time to replace my fridge and oven. They’re approaching 14 and 15 years old, respectively, and have started making some strange sounds. If I get a decent bonus from my employer, this is something I’m going to seriously consider.
- I plan to travel more than I did in 2015. My 40th birthday is this year (whoo hoo!) and I have a couple trips planned with friends. My brother and sister-in-law live out of state so I’d also like to visit them this year, which I didn’t do in 2015.
How was your 2015? What changes are you making for 2016?