Finance · Lifestyle

The 5 Changes With the Biggest Impact

Besides being on a journey of financial independence, I’m also searching for ways to simplify and improve my life. In today’s post I’ll talk about the changes I’ve made that have had the most impact.

#1: Automating My Savings

This comes as no surprise to anyone with any kind of exposure to personal finance. Automating your savings is the easiest, most painless way to accumulate wealth. What you don’t see, you don’t spend. It’s as easy as that. I’ve always contributed to a 401(k) from the first day I started working my first “real” job out of college. Admittedly, sometimes I was only contributing 1% (when I bought my house, for instance) but I was always contributing.

The side effect of automatic savings is that you avoid lifestyle inflation. Anytime I get a raise, I either change my 401(k) contribution or the amount that is automatically moved to my taxable brokerage account each payday. Even though I don’t spend much money, I don’t live in deprivation. Instead, it’s made me really think about what I value the most so my money goes towards only those things.

#2: Tracking My Expenses

Prior to 2014, I didn’t bother tracking my expenses. Outside of my mortgage, I was debt free and living within my means, so what was the point? In 2014 I started using Mint. Mint made it easy because all my accounts are linked and I can split transactions into multiple categories. This makes it easy to be very specific about what each transaction was for. While I did most everything using the app, it’s the desktop version that’s the most helpful. Since I rarely used the website, I started tracking my expenses in Excel instead. Excel is free for mobile devices and I use Dropbox so that I can view my files on both my iPhone and Android tablet. It does take more diligence to track expenses this way, but I find it works best for me, as I can easily see a running total for the year as well as month over month.

Until I started tracking my expenses, I had no idea how much I spent annually on anything. Sometimes it’s surprising ($4,000 on my cats!) and other times it’s embarrassing (only $500 in donations?). While it hasn’t caused a major behavior change yet, I do feel more in control knowing exactly how my money is being spent.

#3: Smaller Wardrobe

In 2016, I took a very serious look at everything in my closet and dresser. Anything I hadn’t worn in at least a year or I didn’t feel comfortable in was donated to Goodwill. I now have 5 short-sleeved shirts for summer and 5 sweaters for winter and the same black pants to wear to work year-round. There’s never a question of what to wear, which has made my weekday mornings so much easier and efficient. My weekend clothes are for comfort, with a couple extra pieces in case I go out and need to look presentable (e.g. not a sweatshirt and jeans situation).

There’s now space in my closet so the hangers can slide around and my drawers aren’t stuffed full. Everything is clearly visible so there’s no digging around to find a piece of clothing. It also has the added benefit of making laundry easier: I do the same loads each week and know exactly how long it’ll take to get it all done.

#4: Keeping a Food Diary

I wrote about this at length in this post, so I’ll just briefly talk about it here. I’ve never been too concerned about the number of calories I consumed but instead worried about the sugar and sodium content. I’d suspected it was bad, since those two things are added to everything, but it was shocking to see just how bad it was. After just one day, I completely changed what I was eating. This change will definitely pay off over the long run.

#5: Meal Planning

This is closely related to #4. By planning my meals for the week, I’ve reduced my grocery bill by about a third and cut down on food waste immensely. I used to have tons of food in my freezer and cupboards, just in case I was craving something. Similar to a smaller wardrobe, meal planning ensures that it’s much easier to find exactly what I’m looking for, without digging through a bunch of stuff.

Now that I’m more aware of my sugar and sodium intake, meal planning guarantees that I don’t eat a combination of foods that would put me over my limits. Prior to this, I’d eat whatever I felt like, without thinking about the content.

 

What changes have you made that have had the most impact on your life?

Health · Lifestyle

Why I Keep a Food Diary

In January, I decided to start keeping a food diary. Was I worried about calories? No. I really don’t eat much so I know I hadn’t been overeating. What concerned me was the content of the food: sugar and sodium, specifically. These two things are in almost everything and I’d become worried about how much of each I was consuming.

Why?

Now that I’m 40, I need to be more careful about my diet. While I’ve never had problems in the past, there is a family history and I need to take my health seriously. It’s easier to prevent health problems than be treated for them down the line.

How I Started

I’m a huge fan of Excel so of course I chose this method of recording everything I was eating and drinking. Excel has the added benefit of making it easy to copy and sum data so I’m not doing the same calculations over and over,  which is perfect since I have a fairly steady rotation of meals that I eat. Just copy and paste and excel automatically sums to give me the totals.

What I Tracked and the Metrics Used

For each day, I’d write a description (one line per meal or snack), the grams of sugar, milligrams of sodium, and total calories. While sugar and sodium were my focus, there was little added effort to include calories. It reaffirmed that my calorie intake wasn’t excessive, which was great to see. My goal was to keep any added sugar (e.g. whole fruit omitted) to 25 g and sodium to 1500 mg. My calories typically come in around 1500-1700/day so anything higher than that would raise a red flag.

What I Found

Yikes. I was right — the amount of sugar and sodium in my diet was excessive and appalling. On day 1 (a Monday) I was consuming 43 g of sugar and 1905 mg of sodium! The scary part is that I don’t drink soda and didn’t have any alcohol. This was just food. I made changes starting the next day, including cutting out the sugary oatmeal and opting for lower sodium foods I had on hand. Day 2 I came in at 24 g of sugar and 1330 mg of sodium. Much better.

Challenges

Grocery shopping that first weekend, after tracking my meals for 5 days, was really tough. It’s hard to find low sodium and low sugar options. My body doesn’t tolerate artificial sweeteners so the only option is to cut out sugar completely. I was able to find low sodium condiments and chips but these still have more than I’d like and choices are few and far between.

Eating out is also a big problem. Restaurants aren’t required to post nutritional information on their menus so it’s kind of a guessing game as to which items appear to be low sugar and low sodium (or at least low compared to the rest of the menu). I only eat out once or twice a week so I consider those to be wasted days, as far as data is concerned, and try to do the best I can.

End Result

This has created a huge lifestyle change. I finally read food labels and actually know what they mean. It’s also beefed up my meal planning, to ensure I stay within my limits for each day. At some point I’ll stop recording my meals, since I’ll get a rotation down and have a better feel for which meals are higher in sugar and sodium than others, so I know which foods shouldn’t be eaten in the same day. While I don’t feel much different, my hope is that I stave off any future health problems by making these small changes now.

Have you ever kept a food diary? If so, what surprised you most?

Finance · Investments

Allocation by Account Type

Happy Valentine’s Day! Since a lot of personal finance bloggers are writing about frugal tips to celebrate the day, I thought I’d do something different and talk about asset allocation. Romantic, right?

Just over a year ago, I wrote this post that explains why I don’t max out my 401(k), even though it’s widely touted in the personal finance community as a must when working towards financial independence. Physician on FIRE recently wrote a post that discusses his allocation by account type, and how much each is really worth in today’s dollars. Reading his post certainly helped validate my decision to invest the way I’ve chosen to. Freedom is Groovy wrote a follow-up post that is also well worth your time. So in today’s post, I thought I’d do something similar to PoF, and show you a breakout of my assets.

Tax Deferred: 53%

This consists of my 401(k) with my current employer and my 401(k) rollover IRA. Every time I’ve left a company, I roll over the 401(k) to the IRA. As you can see, this makes up the largest bucket within my assets. I currently contribute 10% of my salary and receive a 4% employer match. I hesitate to invest more than that since taxes will be due on this money when I retire.

Real Estate: 22%

This consists of my primary residency — a townhouse I’ve owned for almost 16 years. I’m not planning to invest in real estate or upgrade to a more expensive house, so this percentage will decline over the years. I wanted to include it for two reasons: 1. To illustrate that a majority of my assets is held in investments and 2. This is available in the event that I ever have to sell it.

Taxable Brokerage: 13%

This is where a majority of my money has been going over the last year and that will continue for the foreseeable future. I’m a fan of the fact that I can withdraw funds whenever I’d like and only have to pay taxes on any capital gains. This account will fund early retirement, if I decide to go that route.

Roth IRA: 11%

This is partially due to the low contribution limits ($5,500/year) and the fact that I’m not great at maxing it out. Going forward I plan to max out my contributions to help bump up the amount I can withdraw tax-free during retirement.

Cash: 1%

I currently don’t hold much in cash — really just enough to cover emergency expenses — but this will change over the next 10 years. I’m going to slowly increase my cash so that I have at least 2 years worth of expenses by the time I (possibly) retire in 10 years. I plan on doing this by automatically transferring a small amount each payday and also putting all future bonuses in a specific savings account.

I’ve decided that this is the best way to allocate my money given my goals, timeline, income, and tax bracket. How does your asset allocation look? What strategy have you decided to use?

Career · Finance

How One Job Made Me and Broke Me at the Same Time

Since I have a degree in something other than my chosen profession, although closely related, my climb up the corporate ladder has been slower than most of my peers. Things changed drastically once I was offered an associate financial analyst position at a large corporation in 2005.

I’d been working as a senior accountant for a family owned company, making around $36k/year. While I was learning a lot, as the finance department was just the CFO and me, there was nowhere for me to move up to. A friend of mine was working for a well-known and well-respected company and mentioned to me that they had a lot of finance openings. I hesitantly passed along my resume, figuring nothing would come of it. Incredibly, I got an interview and was offered a job. It was entry level, despite my 6 years of experience, but my starting salary was $44k/year — an increase of $8k just for moving to another company. This is the beginning of how this job made me.

My manager in that role was great — she encouraged me to get my MBA (which I did, with tuition reimbursement), and she gave me a promotion to financial analyst just one year after I was hired. This promotion bumped me up to $55k/year. I was finally on par with my peers in regards to salary and I obtained a graduate degree, paid primarily by my employer. There’s no doubt that this set me off on an incredible trajectory and it completely changed my life. If I hadn’t taken this job, I wouldn’t have my MBA and would likely be making less than $50k to this day.

But all good things come to an end. Shortly after my promotion, my manager accepted a new internal position. After that came a string of less than stellar managers, as well as a culture shift that made working there very difficult.

This is the part about how this job broke me. The culture at this company became such that they really believed that treating employees horribly would make them work harder. Instead, the good employees chose to leave the company, while the bad employees remained.

This was a culture where failure wasn’t an option. Mistakes were unforgivable and the environment was extremely tense. Every day I’d walk out of the building and think to myself, “This job is going to kill me.” They’d eaten away at my self-esteem so much over the years that I questioned my self-worth and really started to believe that I wasn’t good enough to find a job elsewhere. Fortunately I found the strength to leave and I’m thankful every day that I did.

This is a well respected company and when people hear that I worked there, they always ask what it was like, expecting to hear me confirm all the great things they believe to be true. This company provided great benefits and pay, but rarely is the culture ever discussed and people are shocked to hear of my experience. While I’m grateful that this company significantly increased my base salary and paid for my most of my MBA, I’m so happy that I don’t work there anymore.

If you’re in a position where you’re doubting your abilities and self-worth, I hope you find the strength to take the steps needed to better your situation. Don’t ever give employers or anyone else the power of deciding what you’re capable of.

Expenses · Finance

January 2017 Expenses

Where did January go? It’s hard to believe that tomorrow will be February already.

I started the month by celebrating New Year’s day with brunch at a friend’s house and ended the month with a brunch to celebrate another friend’s engagement. We sure do love brunch 🙂 The rest of the month was fairly mundane, filled with work and errands.

Since I don’t plan to spend any money today, I thought I’d get ahead and post my January expenses today, rather than waiting another week. Without further ado, here’s how January panned out.

*Just a reminder that I don’t use affiliate links (not that there’s anything wrong with that). I’ve only included the links in case you’re curious about the specific items I reference.

Financial independence is really important to me and it’s currently my main financial goal. I’m trying to keep my monthly spending to $1,667. This is very reasonable, coming in at $20,000/year.

I’m sharing my monthly expenses to illustrate that it’s not difficult to have a great life while spending far less than the household average. I’m fully aware that I’m able to do this because my mortgage is paid off and I don’t have a car loan or credit card debt. It was a long journey to get here and now I’m reaping the benefits.

Although I use Mint and Personal Capital to keep an eye on all my accounts, I use Excel to track my expenses. I’ve found that this works best for me, since I can easily compare months and see a running total for the year for each category.

If you have questions regarding how much I spend on groceries, my cell phone, etc., feel free to drop a note in the comments and I’ll happily provide those details. You can also check out my 2016 total spending by category here.

Here are my January expenses:

I spent $507 on fixed costs (e.g. association fee, utilities, insurance, etc.). No surprises here. It was exactly what I was expecting, as fixed costs tend to be. This spring I’ll be paying my property taxes and condo insurance, both for the entire year. Until then, my fixed costs are nothing out of the ordinary.

I spent $1,241 on variable costs (e.g. food, gas, house supplies, gifts/donations, etc.). There were a few large expenses this month: my cat’s annual check up at the vet ($152), car maintenance ($291), the purchase of a new printer and supplies ($105) – which was on sale at the time, and an air purifier ($113). I also stocked up on coffee ($55), which should last about 5 months and is purchased with a discount through Amazon’s Subscribe and Save program.

Best news this month? My cat, Moe, got a clean bill of health at his vet visit and only needs to go in for annual exams here on out, unless he’s showing symptoms of his glucose being off. This is a huge change from the many glucose checks he had during 2016 and we’re both looking forward to a much longer stretch of time between vet visits.

Total spending for the month was $1,748.  which has slightly exceeded my goal of monthly spending of $1,667 or less. No surprise given all the extra expenses over $100 this month, but not bad with all things considered.

How did your January go? Any challenges?

Finance

Why I’m Leaving Betterment

Last March I wrote this review of Betterment, a robo-advisor, which I’ve been using for my taxable brokerage account. The main draw of having an account with them was their tax loss harvesting feature. After having my taxable account handled by Betterment for the last year and a half, I’ve decided to close my account and move the funds into a new taxable brokerage account with Vanguard. Here’s why.

Reason #1: Consolidation of Accounts

Since my 401(k) rollover IRA and Roth IRA are both with Vanguard already, it makes sense to move my taxable account to Vanguard as well. It’ll be one less login and account to keep track of, and it’ll be much easier to move funds around when/if that time comes. I originally created a brokerage account with Schwab, due to how little it takes to start investing (vs. Vanguard’s $3,000 minimum for mutual funds). But Schwab made transfers from my bank account to my brokerage account, and then investing those funds, very cumbersome. I then moved the funds to Betterment, which did make transfers and investing much easier.  But now that I have more than enough in my brokerage account to invest in whatever Vanguard funds I’d like, now is the time to open a brokerage account with them.

Reason #2: Performance

While I’m not necessarily disappointed by how my account has performed over the last 1.5 years, I’m also not blown away. In fact, my rate of return for 2016 was slightly lower than the two Vanguard accounts that I manage myself (and rarely touch in regards to reallocation). If I’m going to pay an advisory fee, I’d like to see a better return than I can get on my own.

Reason #3: Excessive Account Activity

Because a robo-advisor is constantly reallocating your account and doing tax loss harvesting, there’s a lot of activity. I first realized this a year ago, when I was working on my 2015 taxes. With only 6 months of activity, the tax form was 16 pages. While I haven’t gotten my 2016 form yet, I’m guessing it’ll be even longer. Fortunately, I can upload the data directly to my tax prep software. Even then, I’m required to ensure each line was loaded correctly. It’s time consuming and something I’d prefer not to do going forward. I’ve also heard that this excessive activity can impact ACA subsidies. While this is something I’ve taken into consideration, it’s not relevant at this point since I don’t plan to retire for at least 10 years and we have no idea what health insurance will look like at that point.

I’m sure that people can provide even more reasons why I should leave Betterment (or not invested with them in the first place), but these are my main reasons for leaving. Overall it was a fine experience, and I’m glad I tried their service, but I had hoped for something so much better.

A Note On How I’m Transferring the Funds

To prevent paying capital gains taxes, I’m doing what’s called in in-kind transfer. This means that I’ll remain invested in the exact same funds, and only the brokerage will change. Since Betterment has me invested in 19 different funds, I’ll likely start selling off some of them to invest in Vanguard funds instead.

Have you ever used a robo-advisor? Would you ever consider it?

Lifestyle

Virus of the Mind

A new year often means resolutions. Did you make any resolutions for 2017? I tend not to make resolutions because I know myself all too well — I may start with a lot of passion but end up becoming bored and dropping it altogether. I’m definitely one of those people who likes to try lots of things but sticks with hardly anything. Instead I try to come up with small habits or lifestyle changes, since those seem much more attainable.

In today’s post, I want to talk about the one resolution/lifestyle change you should definitely make for this year.

Be True To Yourself

This is the one thing I wish for you this year. We live in a culture that is dominated by advertising. Every day we’re bombarded with messages regarding what we should look like, how to define success, and what type of life we should live to be considered “normal.” While it took until my mid-30’s to truly be comfortable with who I am, I’ve worked really hard to be true to myself without giving in to peer pressure to appear normal to other people.

As a 40-year-old woman who is single and childless (and has no problem staying that way), I know the struggle all to well. It isn’t just the media telling me that I’m not normal, but friends and family as well. I’ve lost track of the number of times (and people) who have given me a hard time for my lifestyle choices. My favorite comments include: “When you meet the right person you’ll definitely want kids” and “Well, you can always adopt after child-bearing age.” For some reason, people just can’t accept that I’m not exactly like them. Isn’t it better to know beforehaving kids that I don’t want to be a mom and be responsible for raising children?

Another example is when I bought my house. I opted for a 960-sq ft townhouse, over a larger single family home. The perception was that this would be my starter house (as so many of my friends have done), but I’m still here 15 years later, with no plans to upgrade to something bigger/nicer. Now that people see how much extra money I’ve been able to invest, due to a small mortgage paid off in less than 14 years, the questions about when I’m upgrading have subsided. They finally see the benefit.

This is also a common theme in the FIRE (financial independence/retire early) community. To accomplish something so extraordinary requires that you don’t care what people think. Could I have a nicer house and car? Absolutely, but I’d rather have the option of retiring when I’m 50 instead of working until 65. It takes a lot of determination to tune out the voices that tell you it can’t be done or it’s not a worthy goal.

When I think about how much influence outside sources have on our beliefs and self-esteem, the song Virus of the Mind by Heather Nova comes to mind. The lyrics talk about how these outside sources are really a virus because they infiltrate our thoughts and prevent us from being who we really are and living lives that make us happy. Here are the lyrics (courtesy of Google Play Music):

While I was watching this talk show the other day
And on it there was this guy
And he was saying “When you let other people tell you what’s right
When you leave your instinct and your own truth behind he said
That’s a virus of the mind,
That’s a virus of the mind”
Well I guess it’s kinda like loosing your sight
For a second you think that they might be right
And it feeds the doubts that you have inside
It almost starts to feels like a crime
To follow your own rhythm and rhyme

I’m pretty happy, living in my
My own sweet time, living in my
I’m pretty happy, and I don’t need your
Virus of the mind
Your virus of the mind

Well I went to this party thing last night
A lot of people I hadn’t seen in a long long time
And they wanted to know about my life
But making me feel like it wasn’t quite right
Like “Where’s is your kids?” and “Where is you car?”
I said “I don’t have either but I have a guitar”
And I ended up feeling like I was a freak
So I found some wine and something to eat
I talked to the dog to pass the time
I told myself “I’m doing just fine”
It’s just a virus of the mind

It’s just a virus of the mind
I’m pretty happy, living in my
My own sweet time, living in my
Yeah I’m pretty happy, and I don’t need your
Virus of the mind
Your virus of the mind

It’s in the deep of your soul, it’s on the tip of your tongue
It’s the feeling you get, when you feel young
It’s in the sound of a beat, it’s in the base of your spine
It’s in your gut reaction, yeah every time
But they tell you what you should have, they tell you who you should be
It’s in the pictures and ads and in the magazines
I’m kicking it off like a bug in the breeze
‘Cause is anyone out there inside me
I say “Is anyone out there inside me?”
I say “Is anyone?”

I’m pretty happy, living in my
My own sweet time, living in my
Yeah I’m pretty happy, and I don’t need your
Virus of the mind

I’m pretty happy, living in my
My own sweet time, living in my
Yeah I’m pretty happy, and I don’t need your
Virus of the mind
Your virus of the mind

Whenever I feel like I’m not normal or keeping up with the Joneses, I repeat the chorus to myself. After all, I am pretty happy for the life I have and try to remind myself that I am not them and they are not me. It’s ok (wonderful, in fact) that there are so many different ways to live your life. Why not live the life that makes you happy?

It’s up to you to determine what that happiness looks like. No one can make that decision for you. But my wish for your 2017 is that you take whatever steps needed to live a life in which you are true to yourself, as that’s the only way to truly obtain happiness.

Expenses · Finance

2016 Total Expenses

Hi Everyone!

Hope your January is going well. Thought I’d share my total expenses for 2016 for anyone who is interested.

Let me preface by saying that the total came in higher than I expected. It’s a good reminder that you can only plan so much and a savings account is invaluable. No credit card interest for this girl!

In total, my 2016 expenses were $21,299.03.

Without further ado, here are my 2016 expenses by category:

Fixed Expenses = $6,613.08 (vs $6,197.67 in 2015)

This is up slightly over last year, mainly due to the cost of internet. Sadly, this cost will be my most expensive utility in 2017, estimated to be $840. Ouch. This is what happens when there is only one option for broadband, even though I live mere miles from downtown Minneapolis.

As for the other expenses: I have a townhouse so my monthly association fee includes lawn, snow removal, garbage, and insurance. The homeowners insurance I pay is condo insurance. Since I don’t really have property, my property tax is relatively low, considering Minnesota is a higher tax state. The taxes owed are from filing my 2015 tax returns; I purposely set my withholding so that I’d pay in, rather than receive a refund.

My house is heated with natural gas, and my water heater uses gas as well. The city I live in started imposing a $7 “city fee” for both gas and electric bills in 2016 so these are both higher than last year and that trend will continue. Since I don’t have a lawn to water, my water expense is quite cheap. I canceled my landline earlier in the year so this will be $0 for 2017. I use Virgin Mobile for my cell phone, which is only $33/month for unlimited everything. I realize that my car insurance seems high, but I have great coverage and I’m happy with the company so I’m not going to mess with it just to save a few dollars.

Variable Expense = $14,685.95 (vs $11,473.44 in 2015)

Most of my variable expenses are quite boring so I won’t bother to talk about gas, groceries, etc. Instead I’ll focus on the big items.

Pet expenses came in about $3,000 more than I expected. It started in January when my cat, Moe, was diagnosed as diabetic. That lead to glucose checks (at $32.50 each), insulin, syringes, and prescription food. Poor guy went in for a dental cleaning in August and ended up having teeth pulled (to the tune of almost $2,000). In October, the focus switched to my other cat, Rocky. Unknown to me, he was suffering from kidney failure and we ended up euthanizing him because it was so advanced by the time he started showing symptoms. While I’ll still be caring for my diabetic cat during 2017, I’m hoping that there aren’t any additional health problems. We’ve both been through enough to last us years. The emotional toll has been far greater than the financial.

The electronics I purchased this year include a Doxie scanner, an SSD for my laptop, new cell phone and a small TV and Roku stick for a spare bedroom. The scanner has made it possible to get rid of a majority of the paper in my house, although I still have a lot of files left to scan. The SSD has made my 4-year old laptop much faster and easier to use. The last two were indulgences for sure, so I won’t even try to justify those.

My medical costs are paid for out of my HSA but I include them in my expenses so I can monitor just how much it is each year. It includes prescriptions for chronic health problems, my annual lab costs for blood tests, and eye exams.

Although I no longer exchange birthday or Christmas gifts with friends or family, I did buy a new laptop for my parents (as they were using my old one, which was more than 10 years old), as well as some small gifts for friends since we’re all turning 40. A milestone birthday deserves a little something. The only gifts I give every year are to my friend’s two kids — I put money into the custodial brokerage accounts I created for them for birthdays and Christmas. This will continue until they are at least 18 (they are currently 3 and 5).

Admittedly, the donations category is lower than I’d like it to be. I’d definitely like to bump up how much I give going forward.

Other Observations

Because my mortgage is paid off and I live in a small townhouse, it only cost $4,804.16 ($400.35/month) to live in my house during 2016. Sadly, I’ve spent well over $200k on my house in the 15 years I’ve lived here, but the average cost per month and year will decline each additional year I live here.

Without the cats, my annual expenses would have been $16,930. I find value in having pets so this expense is worth it to me and I can easily afford it. If you’re thinking about adopting a pet, make sure that you are aware of all the possible expenses beforehand.

Plans for 2017

Looking ahead, I have two goals:

  1. Make sure that I’m saving enough to cover some major house expenses coming up
  2. Focus less on stashing as much money as I can into investments and instead set a savings goal for the year.

Regarding the first item, there are a few expenses likely in 2017 that I want to be prepared for. My fridge is almost 15 years old and I wouldn’t be surprised if it went out any day now. Since my cat’s insulin needs to be refrigerated, I’d rather replace it before it dies so I’ll likely do that this spring. Another appliance that I’m thinking about replacing is my washer/dryer. The dryer is fine, but I have an HE front loader and I hate it. The set is 10 years old so I’m debating replacing this in the spring. Since my house requires a stacked unit, the dryer will have to go as well. The last item is my water heater. It’s almost 9 years old so it’s possible this could also go out any day. So, I need to make sure I have enough in savings to cover all 3 of these being replaced, which would be around $4,000.

For the second item, I’d like to be a little less stringent regarding how much I save and spend. My mentality over the last two years has been to spend as little as I can while saving as much as I can. Instead, I’d like to set savings goals for the year and enjoy the rest of my money. My hope is that I’ll focus less on my finances if I loosen the reins a little. The important thing is to hit the savings goals, and let go of the small stuff.

How was your 2016? Any big goals for 2017?

Expenses · Finance

December 2016 Expenses

Happy New Year!

December was a great month. I had plans every weekend and enjoyed spending so much time with friends and family. The first weekend, I did glass blowing and we made Christmas ornaments. It was something I’d always wanted to try and it didn’t disappoint. The instructor did a great job of explaining how and why things are done. And I have a beautiful ornament to show for it!

The second weekend was Christmas tea service with three of my friends. We consider this our gift to each other, rather than the exchange of physical presents. This was our third year and it’s a tradition we plan to continue.

The third weekend was brunch for a friend’s 40th birthday. She was out of town for work on the day of her birthday so we got together over the weekend. It was also the day where the temperature was -20 degrees (with a wind chill of -30). To make the most of being out, I saw a movie afterwards with one of the friends who was there. As a side note, Office Christmas Partywas hilarious, if you’re into the raunchy comedies.

I’ve been enjoying my time off from work. Outside of Christmas and New Years, I’ve mainly been trying to get things done around the house. Feels good to finally check some things off my to do list, including dropping things off at both Goodwill and our county recycling center. There really is nothing better than purging the items you no longer need. My house is looking pretty good 🙂

To prevent this post from getting too long, I decided to write separate posts for December expenses and my 2016 total expenses. The annual expenses post will be published next week.

So how did my busy December shake out?

On to the numbers…

Financial independence is really important to me and it’s currently my main financial goal. Like I mentioned in my August post, I’ve decided to increase my budget to allow for monthly spending of $1,667. This is still very reasonable, coming in at $20,000/year.

I’m sharing my monthly expenses to illustrate that it’s not difficult to have a great life while spending far less than the household average. I’m fully aware that I’m able to do this because my mortgage is paid off and I don’t have a car loan or credit card debt. It was a long journey to get here and now I’m reaping the benefits.

Although I use Mint and Personal Capital to keep an eye on all my accounts, I use Excel to track my expenses. I’ve found that this works best for me, since I can easily compare months and see a running total for the year for each category.

I’ll post my total spending in specific categories within the next week. In the meantime, if you have questions regarding how much I spend on groceries, my cell phone, etc., feel free to drop a note in the comments and I’ll happily provide those details.

Here are my December expenses:

I spent $448 on fixed costs (e.g. association fee, utilities, insurance, etc.). No surprises here. It was exactly what I was expecting, as fixed costs tend to be. My big annual expenses are all in the first 5 months of the year so the back half is relatively quiet.

I spent $1,970 on variable costs (e.g. food, gas, house supplies, gifts/donations, etc.). Yep, this is way more than I would normally spend but includes the glass blowing ($48), tea service ($51), and all the other restaurant meals with friends this month. There were a few big items driving this total, though: A couple of donations to Donors Choose to support various classroom projects, renewing my Consumer Reports subscription for 5 years, the purchase of a small air compressor so I can fill my car’s tires in my garage (instead of a gas station), a small TV and Roku stick, and – the big one – a new cell phone.

A new cell phone was the big purchase I’d been debating when I wrote my November expenses post. Because I use Virgin Mobile, I paid for my phone outright, to the tune of $590. I’d had my other phone for just over 3 years and, since it was an iPhone 5, storage became an issue. 16GB isn’t enough, especially when the operating system takes up 4GB. I upgraded to an iPhone 7 and my parents are now using my old phone, which was a big upgrade from their super cheap Android. Win-win for everyone 🙂

Total spending for the month was $2,418. This year I’ve spent $21,299, with an average of $1,775/month, which has slightly exceeded my goal of monthly spending of $1,667 or less.

Coming up in my next post: I’ll share my 2016 total expenses, along with a comparison to 2015 and my thoughts regarding how the money was spent. I’ll also share my goals for 2017.

How did your December go? Any challenges?

Expenses · Finance

November 2016 Expenses

Happy December Everyone!

How’s your month going so far? Mine is still crazy busy, as I continued to do both jobs for the first 2 weeks of the month. Things are finally getting better and I’m now officially down to just one job! The new job is going great and I’ll even be able to take the last week of December off. Well deserved, if I say so myself.

December also brings with it many social events and I love seeing everyone. I’ll write more about this next month but  will say that so far December has not disappointed. Every weekend is booked, despite the cold and snow that suddenly hit us in Minnesota. There’s no doubt that winter has finally arrived, after an especially mild fall.

Tomorrow marks 2 months since my cat, Rocky, passed away. My other cat, Moe, has taken to being an only cat very well. Rocky demanded a lot of my attention over his 11 years so Moe is enjoying all that attention being directed at him instead. We’ll go to the vet in early January for his annual exam so hopefully all is well and 2017 is a much easier year for both of us.

On to the numbers…

Financial independence is really important to me and it’s currently my main financial goal. Like I mentioned in my August post, I’ve decided to increase my budget to allow for monthly spending of $1,667. This is still very reasonable, coming in at $20,000/year.

I’m sharing my monthly expenses to illustrate that it’s not difficult to have a great life while spending far less than the household average. I’m fully aware that I’m able to do this because my mortgage is paid off and I don’t have a car loan or credit card debt. It was a long journey to get here and now I’m reaping the benefits.

Although I use Mint and Personal Capital to keep an eye on all my accounts, I use Excel to track my expenses. I’ve found that this works best for me, since I can easily compare months and see a running total for the year for each category.

In early 2017 I’ll post my total spending in specific categories. In the meantime, if you have questions regarding how much I spend on groceries, my cell phone, etc., feel free to drop a note in the comments and I’ll happily provide those details.

Here are my November expenses:

I spent $450 on fixed costs (e.g. association fee, utilities, insurance, etc.). No surprises here. It was exactly what I was expecting, as fixed costs tend to be. My big annual expenses are all in the first 5 months of the year so the back half is relatively quiet. I’m currently reviewing my accounts and budget to ensure these will be easily covered for 2017.

I spent $786 on variable costs (e.g. food, gas, house supplies, gifts/donations, etc.). Finally – a return to normal. I had to get insulin for my cat and bring him in for a glucose check, which was less than $100 total. I also bought an SSD for my laptop during Black Friday. Other expenses included a few gifts for loved ones and a donation to Minnesota Public Radio. The Current is my favorite radio station and I’m happy to support them.

Total spending for the month was $1,236. So far this year I’ve spent $18,881, with an average of $1,716/month, which has slightly exceeded my goal of monthly spending of $1,667 or less. I’m counting this month as a win – close enough!

Coming up in next month’s post: Just how much do those social events and outings cost? I’m planning a big purchase for later this month, so I’ll talk about what that is and why. I’ll also share my 2016 total spending by category. Any guesses as to which was the highest?

How did your November go? Any challenges?