Our 2017 Household Spending: Reaching FIRE Without Feeling Deprived

Welcome to our annual detailed household spending report! We’ve been publishing our expenses since we launched this blog.

Now that 2017 is so last year, we are able to get this post out. Spending reports usually do well with our readers, so we’ll keep publishing them on an annual basis. We’ve been tracking our household spending for many years, and this is a great way to analyze it and see how it’s trending.

Tracking expenses feels very different from budgeting. There are no constraints, per say, when you’re just tracking things. You see where the chips fall and analyze how things played out. In budgeting, you’re trying to stick to a number, which I recommend wholeheartedly if you’re beginning this journey and need to make it work on a tight budget.

What surprises me is that we don’t really look at our “budget” and think: are we okay making this purchase? We continue to spend based on what we need and the value something has, and that has become the norm for us. We don’t have to put ourselves on shopping bans because shopping is not an obsession that kills our financial progress. In the end, we tend to stick to our overall budget, even if we are over or under in some categories.

I’m sure that after we retire we’ll be even more mindful of a budget only so that we don’t overspend as we get used to not having bi-weekly paychecks.

How we categorize our expenses

We divide our expenses into three buckets: Essential, Discretionary and Gift/Donations.

Essential expenses are core expenses that we mostly can’t avoid. Could we reduce them in bad times? Maybe by a little, for example we could avoid luxury grocery items in a bad recession, but most of the expenses are fixed.

Discretionary expenses can be slashed in half or even close to $0 in bad times. Entertainment, restaurants and travel are easy things to cut out of our budget if we need to. These are expenses that we’ll be able to lower during recessionary times in early retirement.

Essential Expenses

Category / Line  item

2017

2016

Comments

  Home
Net Rent$5,367$2,358$13,800 (gross rent) – $8,433 (profit from rental property).
Home Supplies$745$915
  Bills & Utilities
Electricity718$717
Trash & Recycling$30$112
Internet$348$348We pay $29 a month for high speed internet.
Mobile Phones$840 $840Cricket plan of $70 a month for 2 lines.
International Calls $30$30
  Auto & Transport  
Auto Services, Parts, Registration, Other$8391,150
Auto Insurance$671$647
Fuel $853$975
  Food & Dining
Groceries$6,233$5,346We tend to buy lots of organic produce, wild-caught fish and coconut water in bulk. We’ll need to keep an eye on it since that’s a 16.5% increase from previous year.

Total

 $16,674

$13,438

We spent $16,674 on essential expenses.

Groceries

We spent 16.5% more on groceries last year. An explanation off the top of my head is that since we are drinking less alcohol, we started consuming other products, such as coconut water and tea, more often. We also added Udi’s gluten-free bread as a staple item and that bread is not cheap! Add a few delicious ready-to-bake crab cakes from Wegmans and there’s our increase.

We save money by buying the ZICO coconut water at CostCo in bulk, but they haven’t been carrying it lately. Coconut water is an awesome natural drink as is and we prefer this brand because it doesn’t have added sugar.

We try to go for high-quality food at the best prices because we understand that without health nothing else matters. You have to make a long-term investment in your health if you want to enjoy your golden years without a suitcase full of pills.

household spending

We enjoyed checking out the farmers’ market in St. Petersburg, FL on a recent trip.

 

Net Rent

We usually apply our rental property income to this line item and that’s why it shows so little. Our rent is $1,150 a month. We had to make more repairs than usual last year on the rental, so we had less income than the previous year as a result.

Discretionary Expenses

Category / Line Item

2017

2016

Comments

  Home
Furnishings $905$0We gave in to the heat and bought two air conditioners among a few other items.
Renter’s/Umbrella Insurance$279$288
Dry Cleaners$48$60
  Auto & Transport
Public Transportation $296$168
Toll Fees$288$296
Parking$37$63
Auto SaleN/A-$1,497
  Food & Dining
Restaurants $3,689$3,806
Alcohol & Bars$1,146$1,726
Lunch at Work$506$231
Coffee Shops$152$88
  Health & Fitness
Pharmacy, Doctor Visits, Gym, etc.$1,036$710Wifey thinks I should put my gym subscription charges under donation.
Health Insurance$1,196$1,144Our contribution to employer-subsidized health insurance.
Dental Insurance$208$208
Vision InsuranceN/A$164Mr. Enchumbao gets it occasionally.
   Shopping
 Electronics & Software$743$1,535
Clothing$462$1,809
 Sporting Goods$7$1,114
 Shopping (other)$109$253
  Other Categories
Travel$4,431$5,734Mrs. E has done a great job with travel hacking, and we used credit card points to offset some travel costs.
Entertainment$1,520$7982017 was the year of concerts, one of our favorite natural highs.
Pets$453$101Mrs. E further upgraded Pushok’s food, aka asaroso, as I call him. He now gets to eat organic wet food!
Personal Care$376$778Fewer mani/pedis and spa visits in our lives.
Shipping/Office supplies$0$6
 Miscellaneous$151$305It includes $19 for data storage.
Education$0$0
Fees, Interest & Bank Charges$0$0

 Total

$18,038

$19,888

We spent $18,038 on discretionary expenses.

Entertainment

Concerts are one activity that we truly enjoy and we plan to continue checking out our favorite artists when they’re on tour in early retirement. We said it was going a year of concerts and it was indeed. We saw many Latin artists in concert and really enjoyed the atmosphere.

The events culminated with Marc Anthony, in Reading, PA, performing all his Spanish hits. That Salsa concert was phenomenal! Here’s a little video performing the song that catapulted him to stardom: “Vivir Lo Nuestro”. Please excuse Mrs. Enchumbao’s energetic hand throughout the video. LOL 🙂

Alcohol & Bars

Last year we decided to challenge ourselves on being alcohol-free for the year and we failed! We spent a good four months dry at the beginning, which was a great start. By May, the Latin concerts began with Ricky Martin, one of our favorites, and it was all downhill from there. Enjoying beers by the porch and the hot days by the beach, in good company and great music, made this challenge unbearable.

We failed with this challenge. We failed big time. Other circumstances also led us to be a little loose on this challenge.

However a few good things came out of it. We became very aware of how much social gatherings, no matter how big or small promote alcohol consumption. It’s like you can’t escape alcohol. In most U.S bars you either have a choice of carbonated drinks or fake juice. If you ask for a non-alcoholic version of a drink you almost pay the same for a sub par version.

We have, though, become more mindful about our health and drinking habits. We already lowered our alcohol spending by 33% in one year. There’s definitely room for improvement and we hope to report an even lower spending next year. The path that we set to no drinking for a full year wasn’t realistic after a few months into it, but we’ll continue on the path to lower our drinking to a minimum.

Celebrating 5 Years of Debt Freedom

2018 is when I celebrate 5 years of being debt free. Wow, time has flown by since I paid off my last debt. What a difference it makes when you no longer have to send a payment to a creditor and can instead send it to your brokerage account and grow your investments. Paying off everything I owed was the best move I ever made. Cinco años sin deudas! Five years without debt owed deserves to be celebrated.

We enjoy being on the receiving end, where corporations and the government pay us to borrow and employ our money. 🙂

Having $0 in the Fees, Interest and Bank Charges category is what allows us to spend more on fun categories and still come out way ahead. There are no car payments, no mortgage interest payments, no credit card interest payments, nothing that requires us to pay interest to someone else.

Let’s say you pay $3,000 – $8,000 in interest annually. Imagine what you can do with that money if you didn’t have to pay off your past purchases?

Shopping

My iPhone 6 died before the year ended. I was so disappointed with Apple that I ended up switching and getting an Android phone. I opted for the Samsung S8 and I’m really happy with my decision. The iPhone X has nothing on this phone and this one came to almost half the price, with my old phone trade in and rebates.

Zone of Tech did an awesome in-depth comparison covering the design, display, specs, camera, storage, features, and price of both phones. Check out the video if you’ll be shopping around for a top-of-the-line smartphone.

$2,230 worth in Travel Hacking

We took a few trips last year. We didn’t leave the continent, but still managed to have fun traveling to the Dominican Republic and other states.

I think we got a lot out of our $4,431 travel spending, but that wouldn’t have been possible without the smart work from Mrs. Enchumbao to save us money on traveling. Her travel hacking efforts brought us about $2,230 in discounts. It’s great way to save money on travel if you’re disciplined enough to handle credit cards. We used points for many hotel stays.

Here are some highlights of our trips. You can click on the images to expand.

Virginia

In late March we went to Virginia for 9 days. We visited Luray, Charlottesville, Williamsburg, and Chincoteague Island. We booked most of the nights with credit card points. (Photos from left to right)

  1. Luray Caverns is a massive underground cave with 140-ft. natural columns, cathedral-sized rooms with ceilings 10-stories high, towering stone formations, colorful stalactites and many natural wonders.
  2. Mercedes-Benz, anyone? This is an 1892 Benz and one of the oldest automobiles on display in the United States at the Car and Carriage Caravan Museum in Luray. It boasts one cylinder and five horsepower.
  3. We toured the University of Virginia campus in Charlottesville and viewed the dorm room of Edgar Allan Poe. There so much history in this university that you can easily spend half a day just going through it all.
  4. The Fabergé and Russian Decorative Arts collection is on display at the Virginia Museum of Fine Arts in Richmond. This Fabergé collection is the largest public collection outside of Russia. It was absolutely stunning for me, and especially, for Mrs. Enchumbao, who could relate to the ethnic details. Plus, both the museum and the exhibition are completely free!
  5. We got to see the wild ponies and some wildlife at Chincoteague Island.

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Dominican Republic

In late May we took a 19-day vacation to Santiago and Punta Cana. That’s right, 19 days – not a typo. 🙂

  1. These are green bananas from my sister’s lot near my dad’s home in Santiago. Since we went to Santiago first and then drove to Punta Cana, we took some produce with us including green bananas, yuca, cilantro, papaya and passion fruit. These helped us save money by not having to buy everything at the grocery store once we got to Punta Cana.
  2. This is how we eat green bananas/plantains. We peel and boil them for about 15 minutes and then have them with a side of sautéed onions and fried eggs. If you’re into meat and dairy, then you can add fried cheese and salami. It’s a very typical Dominican dish.
  3. It’s very common to see a trio of musicians playing merengue tipico in the touristic areas. Even if you don’t understand what they’re saying, the drums will get you moving. This band was at first trying to compete with your bluetooth speaker and won. 🙂
  4. Macao Beach is one of our favorite places in La Altagracia Province, aka Punta Cana, because everyone calls the entire Province Punta Cana. We enjoyed our favorite fish with side dishes of fried plantains, rice, beans, salad and an avocado that we bought from our favorite beach restaurant.
  5. We spent several afternoons at Playa Juanillo. This beach is public but has no vendors. It’s a nice beach with great restaurants and free lounging chairs.

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Sightseeing in Philadelphia

In July, our niece from Florida came to visit and we showed her what the city has to offer.

  1. The Dominican flag adorning the Benjamin Franklin Parkway.
  2. The Korean War Memorial
  3. The Rocky Statue
  4. My niece attempting to run up the steps that used to lead to the Rocky Statue before it was moved to the side lawn.
  5. City art

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Labor Day break in Rhode Island

We also went to Rhode Island for 9 days around Labor Day.

  1. View of the Misquamicut Beach.
  2. Yummy lobster sandwich–a must-have when we visit New England.
  3. The lake at Lincoln Woods State Park in Lincoln, RI.
  4. Mrs. Enchumbao pondering as she takes in the view of the lake.
  5. Mrs. Enchumbao dancing with dad as we celebrated our old man’s 80th birthday. He’s an Energizer Bunny kind of dancer! Give him wine and music and he’ll dance all night.

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Florida

Visiting the Florida’s Gulf Coast was a great way to end our travel because we’re strongly considering Sarasota as our early retirement home and really enjoyed our “exploration”. We spent 18 days total in North Port, Sarasota, Saint Petersburg and Clearwater Beach and booked a total of six nights outside of North Port with points. We have family in North Port who we stayed with, and then we saved around $1,200 in hotel costs by using credit card points.

  1. Ca’ d’Zan, a Mediterranean Revival residence in Sarasota, was the winter home of the American circus owner, developer and art collector John Ringling and his wife Mable.
  2. Christmas decorations in St. Petersburg
  3. The Sundial in St. Petersburg
  4. Santa made of snow sand in Siesta Key.
  5. The Unconditional Surrender sculpture in Sarasota – a series of sculptures by Seward Johnson resembling a photograph by Alfred Eisenstaedt.

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Thanks to Mrs. Enchumbao’s diligence with travel hacking we were able to vacation for less on points.

Back to our expenses, the original topic of discussion, if you add essential and discretionary expenses, our living expenses were $34,712 in 2017.

household spending

The  chart above shows how our expenses have been trending since we started reporting it on the blog. Our total spending stayed very close to the previous years, so no surprises there.

Having all these years of tracked spending is helpful because we were able to draft a detailed analysis of our future spending in early retirement based on that data.

Gifts and Donations

  Category

2017

2016

Comments

 Gifts & Donations

$6,672

 $10,933

Most of this money goes to help our parents, some gets donated and some gets spent on thoughtful gifts to friends and family. $6,672 or 16% percent of our total expenses went to this bucket.

Three Christmases ago, we got everyone to unsubscribe from excessive gift exchanges for birthdays and holidays, and instead we spend time together with our loved ones. The holidays are not stressful for us, at all, and are kind to all of our wallets.

A recap of how we spent

household spending

So there you have it. 40% of our spending money went to necessities, 44% was spent on “fun stuff” and 16% went to help others.

Expenses for this year should be about the same. Some categories will be lower while others will be higher and some new categories will be created. It’s amazing how consistent our spending stays throughout the years after I paid off my debt and started spending mindfully. $40,000 was just about half of what I used to spend on my own back in 2010 when I had a big house with a mortgage and thought I’ll be working for corporate until 65. That seems like such a distant life now.

We had a great year financially, and it’s so awesome that even though we don’t spend over $50,000 a year, we are not deprived of anything. We probably splurge more than households that spend over $100,000 a year because we put our money into buckets that bring us pure happiness, instead of spending to keep up with others and follow trends.

Need to catch up on previous years of spending? Here are the report from the previous three years: 2014 Spending2015 Spending2016 Spending. Cheers to a great 2018. FIRE is coming!

How did you spend in 2017? Did you spend more or less than what you budgeted for? Where did you spend less or more and why?

Please like & share:
How Renting on the Cheap and Eating Out Less Aligned Us to a World of Opportunities
Admit That You Suck at Saving Money and Take Action Today

Mr. Enchumbao

Mr. Enchumbao retired at 44. He worked for 13 years at Vanguard, primarily as a Communications Project Leader in the Institutional Division, helping people save for retirement.

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4 Responses

  1. LW says:

    I absolutely LOVE your commitment to charitable giving. One of the things I see lacking in so many FI budgets is charitable giving. Time is a great gift, but money is what organizations and families need to keep operating. If we retire early with zillions of dollars, but don’t contribute to the greater good, then what’s it all really for? Thank you for your generosity and example of that generosity in a very public forum.

    • Hey LW,
      Thanks for your nice comment! Even after we retire we’ll still be committed to charitable giving. Besides helping others, it makes us feel really good as well. One thing that I realized about 7 years ago is that if I don’t start helping today when will I? I always had an excuse to not give such as a bill to pay and other responsibilities but once I started to eliminate debt and make room for other expenses I made sure to include donations and helping loved ones in there. My wife feels the same way about it so we do what we can.

      We also want to be more personally involved with charitable projects after we retire. We’re not making money off this blog since it’s just a hobby but if we do, in the future, we’ll most likely donate a percentage to charity and document it here. There are so many possibilities to continue helping. It’s the kind of projects that we’ll keep us motivated in early retirement.

    • Thanks, My Early Retirement Journey! I’ve always been really good with paying off my credit cards each month, so I was excited to learn that I could take advantage of the travel hacking approach. It’s not for everyone, and I only recommend it to people who are always on time and pay in full. It’s nice to be rewarded for being organized. 🙂 Are you doing any travel hacking? I’m always looking for new tips!

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