I’ve analyzed my expenses for the whole year of 2013 and I’m ready to admit where my money goes! But first, a preamble:
My employer gives me a non-taxed benefit of 3% of my salary for our “Flex Benefits” program which can only be used for health, disability and life insurance. I pay 4.9% of my total salary package for all of these benefits, so I pick up the additional 1.9% myself. Of course, the health insurance is really just supplementary health insurance because public health pays for most costs.
As a public sector worker, I pay 10.36% of my salary into the mandatory pension plan. I pay the required fixed amounts into the Canada Pension Plan and Employment Insurance programs.
I have been guilty of saying I pay 39% of my income in taxes, but that’s not true – those are my total payroll deductions, but only 22% goes to taxes.
The Money Pool
I report on all the money I control, which is all of my salary and the money that Rom gives me for shared household expenses. I set the “Housekeeping Budget” by taking the previous year’s expenses for the running of the household and dividing it by 2. Rom pays me that amount in monthly installments, and I pay all the bills. Yes, it is my choice and he hasn’t asked for a turn! He keeps the rest of his money. We each decide on our own savings rates. Whenever we have unexpected shared expenses or want to save for a shared goal, we work it out between us. We both have high savings rates so we don’t worry that one of us won’t cough up their share of an emergency bill! Rom has a discretionary spending amount which I don’t track, and he doesn’t pay any attention to mine. We are both frugal and have no debts. You can read more about our financial decision-making here.
My personal savings rate this year was 18%.
I will follow the pattern set by A Boomer Girl’s Guide and report percentages by category. All the percentages are based on my take-home pay, minus my savings, plus Rom’s share of the housekeeping budget.
I am in the fortunate position of owning a house with no mortgage, but housing costs still made up almost 22% of our budget. Only 1% of that was on discretionary spending like new cookware or furniture. The rest was for heat, electricity and water, property taxes, home insurance, repairs and maintenance. Our house is 17 years old and has not required any major repairs or system replacements yet. The only unusual expense is that I prepaid the insurance up to Nov 2014 to save service charges. Without the insurance pre-payment, housing expenses would have been 20.1%.
I bet you’re surprised this category ranks as #2! This is the first year we decided that entertainment was a shared expense, and budgeted accordingly. Previously we each paid some, and I only tracked my own. This category includes Internet and cable TV, our cell phones (non-essential), dining out and visits to cafes, concerts and movies, and buying books, music and DVDs. The amount includes 3 “one-time” costs for me: a new DSLR camera, a new elliptical exercise machine, and a pair of inline skates.
Food and Consumables 12.1%
I was pleased that our grocery bill hit a new low of 10.7%, including any snacks and junk food that we buy on grocery days! The rest was for paper goods like tissues and toilet paper, cleaning supplies (or ingredients to make them) and toiletries for both of us.
Car and Child – tied at 10.9% each
I had saved to pay for Link’s university expenses, but since they’ve left school, they’ve been transitioned off parent support! This was the change-over year, gradually reducing pay-outs and encouraging self-sufficiency. Our income level allows us to pay for Link’s trips home, and to be generous with gifts. We also helped out with Link’s cross-town move this Fall.
Car expenses are a little higher this year because, as with home insurance, I pre-paid car insurance up to November 2014 to eliminate service charges. My Nissan Versa is just a year old so I had no repair bills. I look forward to low gas costs this year since I’ll be walking to work – I used to commute 45 minutes each way at my old location.
Please be kind and don’t assume I value my child and my car equally, LOL!
Rom and I spent a week in the UK (London and Sussex) and a week in Toronto this year. This amount includes our airfares and other transport costs, lodgings, meals and vacation entertainment (Musicals! Museums!) But any vacation shopping I did was shuffled to the appropriate categories, such as clothes or leisure.
I’ve mentioned in other posts that in my family (of origin), everyone still buys for everyone, rather than just kids, or drawing names. This goes for birthdays and Christmas. No one seems to be stressing about it, and we all enjoy it, so I don’t expect any change in 2014.
Hmm, now that I see 3.7% in print, I am inspired to inch it up to 5%!
Now this is a real catch-all. It includes cat food, litter and kennelling at 1.3%, and all incidentals such as bank charges, blog fees, minor work expenses, and hair cuts. At year end I had $56 that I was completely unable to account for! But since that’s less than $5 a month I will let it go 🙂
I had some uninsured dental and prescription costs.
Although I budget for clothes and try to contain costs, I do buy all year long and try to look somewhat professional for work, and somewhat sparkly for holidays.
Looking at the year, I am reminded of how much my life changes are reflected in my budget: no daycare costs, no mortgage or car payments, lots of leisure and vacationing. I feel very privileged to live where I live and have the things I have. I know we trade our “life energy” for money, as they say in Your Money or Your Life, and I am liking the balance right now.
How do you feel about yours? Any big changes in the works?