2023 Spend vs. Budget
Code: Select all
High Low Actual
-------------------------------------------------------
Total $62,344 $46,588 $50,219
-------------------------------------------------------
Medical $12,442 $8,830 $11,809
Groceries $8,400 $7,200 $8,492
Discretionary $7,950 $7,950 $6,281
Dental $12,844 $5,944 $6,102
Taxes $5,745 $5,232 $6,050
Home $7,032 $4,949 $5,403
Utilities $3,449 $3,389 $3,338
Car $2,770 $1,955 $1,556
Pets $1,712 $1,139 $1,187
Annual Spend by Year
Code: Select all
Year Actual Inflation Adjusted - 2023 Dollars
----------------------------------------------------------
2023 $50,219 $50,219
2022 $43,284 $45,413
2021 $54,006 $61,197
2024 Budget
Code: Select all
High Low
---------------------------------------
Total $60,970 $53,321
---------------------------------------
Medical $14,527 $13,391
Discretionary $10,807 $9,807
Groceries $8,820 $7,938
Home $8,743 $6,243
Taxes $6,352 $6,054
Dental $4,344 $3,844
Utilities $2,976 $2,916
Car $2,687 $1,987
Pets $1,714 $1,141
Overall
The financial side of retirement works. Year end review took a couple hours. No surprises or stress. Of course - we're spending 10% more year over year. Raises don't hurt feelings. The 2022 market drop caused us to make drastic cuts. Those are unwinding.
The primary increase was medical care. I saw many providers in 2023 and expect more in 2024. During accumulation - my healthcare strategy was "life just be this way." It turns out there are better options. I have a lot of deferred maintenance to address. Some might curse their poor health, but I see this as investment in aging well.
I don't see us moving closer to ERE spend. We'd need to drastically reduce consumption around healthcare, food, fun or the home. Neither of us want to, and we can afford not to. One of my changes for 2024, is to stop chasing small money. A discount here, a used purchase there. The net gain is a couple thousand. Considering opportunity cost, the behavior is not rational. At times, it borders on mental illness.
Now that I have an identity beyond "employee", the need for growth is diminishing. I held a deep seated insecurity. I was running from my bad work experience. Much of 2023 was spent pursuing a performative lifestyle - aspiration to an ideal. That has faded. I'm playing more video games. Exercising less. Eating more flexibly. Volunteering less. Spending more. Even having the occasional drink.
Life goes in ebs and flows. I'm ending 2023 on a lull. It feels right. Maybe it's a life transition.
Random Thoughts
1. Aligning our annual budget with the calendar year worked much better. Society has a financial cadence. Between taxes and insurance, fighting it makes no sense.
2. Similarly - budgeting against annual categories worked much better than monthly targets. Especially with the forecasting I built. Expenses are cyclical, but smooth out over the calendar year. There's no point in stressing over small monthly fluctuations.
3. The budgeting process continues to simplify. Fewer categories. Simpler formulas. Less transactions. Rather than maximizing returns, it's all about minimizing mental overhead. In 2020 I would have said "That's it??? What about X, Y and Z!!!" Now, I think if that little stuff matters, the big picture is broken. Strategy over tactics.
4. My consumer spending continues to shift. A personal goal for 2024 is to separate from paid streaming services. I signed the Netflix account over to my wife and cancelled Pandora. Between Libby, Hoopla and Kanopy via my library - I think this is highly feasible. It's not that I cannot afford it, I just hate the all you can eat subscription model. The increasing prices and ads accelerated my decision.
5. I'm also trying to reduce services accessed via smartphone. A big one is my use of MyFitnessPal. I don't have reliable hunger or fullness signals. I solved the problem by abdicating to an app. It's been at least a decade. So I'm now trying to reign that back in. The tool works great, but I don't want to touch my phone multiple times per day. I can eyeball the nutrition of just about any meal, so I hope it's an unnecessary crutch.
6. I'm cancelling participation in my insurance company's wellness program. It nets out around $150 per year. But I cannot help but to optimize, play it for a high score. It manifests in my life as a really crappy video game. True to form - I'm waiting for the big points boost on 1/1, so I can cash out before closing the account.
7. I finally caught COVID. It wasn't bad. A couple days fighting a fever and intense sore throat. Two weeks tired and isolating. My wife even managed to avoid it. Still - the experience has me second guessing public gyms. When I go. Where I go. If I use one at all. I don't think opting out entirely is my best choice, but it is tempting. More likely I'll limit to low traffic times. At least through winter.
8. Credit card churning might stay. That's the best hourly return I've found on chasing small money. It nets out close to $100/hr, tax free. As we're close to the 5/24 limit, I may consider bank account churning as well. I don't need it, but saying no to free money is hard.
9. We never did hire a housekeeper. The service was also scrapped from our draft 2024 budget. We never got better at cleaning either.
10. The house is in a borderline state of disrepair. In an attempt to combat this, we doubled the home maintenance budget for 2024 - from $1k to $2k. The challenge is I neither care nor have the DIY skills. My wife is a little better, but it's hard to overcome inertia. I expect the budget to escalate further in 2025, as other one time expenses slow down.
11. We're finally biting the bullet for formal estate planning, with a real life lawyer. That's budgeted at $2k. We've reached the age where a death in the extended family is unsurprising. After watching that repeatedly unfold, my wife wants to minimize our burden on loved ones. I cannot say I'm eager to do this, but she's taking the lead.
12. Some of the medical care I anticipate leads to a lot of sedentary time. I'm debating how that time is spent. Part of me considers making a run at programming. I don't relish the associated computer time. But it might be engaging, and I might be really good at it. I could also be bored and mentally wandering, due to my recent COVID downtime.
13. Along those lines, I'm making a renewed effort to reduce the presence of big tech feeds in my life. Reddit. LinkedIn. News. Offer Up. Deku Deals. Instagram. This is a cyclical problem. I cut things out and then they creep back in. While resting during COVID, it got bad. 8+ hours per day on my phone. If I'm gonna stare at a screen, I might as well get something more out of it.
14. I'm also debating on making a stronger attempt at removing big tech services from my life. Replace gmail and google calendar with hey. Rip my audible books and delete the Amazon account. Transition from Windows and Office to an open source solution. Move my phone to LineageOS. This might be aspirational stuff, but it's on my mind. The services are all great, but I dislike being dependent and the privacy implications.
15. I've decided to buy video games once per year, during the holiday sales. Despite only spending a couple hundred on games per year, I like to constantly monitor for deals. Snagging games at the "lowest price yet!" has lead me to a 1000+ hour backlog. I'd much rather have spent that deal hunting time playing games. So I will. My library also has games to borrow, which I have yet to explore.