#14 75% of 2017 Was Spend On 3 Things

This was an expensive year.

We upgraded to a new house which increased our mortgage payment by $240 every two weeks. We incurred all the expenses that come with buying/selling a house (land transfer tax = $22,000, lawyer fees = $900 x 2, realtor commissions = $22,000, and staging = $2,100). And we renovated our new house = $55,000.

Excluding these one-time house costs, our 2017 normalized expenses were $61,000.

The bulk of these expenses fall into 3 main categories.

1. Housing (mortgage, property tax, maintenance, utilities/gas/water/waste, insurance)


2018 is going to be a little bit more expensive since our new mortgage on an annual basis is $6,000 higher (thankfully half of it is going to the principal payments)

2. Food 


We break this down into 7 categories including coffee = $875, snacks = $300, grocery = $4,000, fast food = $425, regular restaurants = $4,300, high-end restaurants = $1,235, and cake = $115

What I noticed about our spending is that we only spent $250 on entertainment in 2017. We get most of our "entertainment" from eating at restaurants, which is why our regular and high-end restaurant expenses are quite high. This is equal to about 2 meals out per week.

I remember when I was growing up, my parents only brought us out to eat maybe once a week, but most usually on special occasions like birthdays and their anniversary.

This is certainly a category we could find some savings in but we choose not to because this is where we get a substantial amount of happiness in our lives. It's worth it.

3. Travel


We travelled quite a bit this year, going to Taiwan to see my wife's family twice. Both trips included side trips to Japan. We also made a road trip to Montreal. We also booked a trip to Vancouver in 2018 as well as another trip to Taiwan and China in 2018. This pulls forward a substantial portion of our 2018 travel expenses into 2017.

These 3 categories make up 75% of our expenses.

The next 10% is from Transportation and Telecom (internet, cell phone plans)

The last 15% is a mish-mash of categories. Exercise (tennis), clothes, entertainment, books/education, extended health (massages), donations and other miscellaneous expenses that are larger and expect to happen infrequently (like buying our coffee machine).


A large chunk of our expense is discretionary, meaning they are for pleasure rather than necessity.

Housing is almost 100% necessity.

Food is about 50/50. If we mostly cooked at home, we could probably cut our total food expense in half, saving about $6,000. My wife would not be pleased though, so I think it's worth the $6,000 a year. Happy wife, happy life. 

Travel you could argue is a necessity, as we do not live in the same city or country as our families. Seeing our parents, grandparents, siblings and their kids is an important part of our lives. But in reality, if we didn't have the money to travel, we would have to live without this luxury which we spent $11,750 on in 2017.

Transportation is a necessity. We do not have a car, so we are already saving substantially on transportation expense.

Internet and cell phone plans are necessities. Information and knowledge are critical to living a rich life. Especially for those trying to get ahead, without access to the internet, this really handicaps your efforts. Just don't pay for more plan than you need.

Among the remaining categories, I'm sure we could have found cheaper or free alternatives to many of them. Instead of buying books we could have borrowed from the library. We didn't need to get massages. We could have bought clothes from less expensive stores. We didn't need to buy an espresso machine but so far we have gained a lot of enjoyment from it and great lattes and tea lattes. We could have saved maybe $1,000 to $2,000.


If we were just living for the sake of living, we could survive on $40,000 of expenses with more than half of that going towards our house expense. Our intentional spending costs us an additional $20,000. These are our luxuries.

I think $20,000 is a fair amount of money to spend on your happiness if you can afford it. 

I wouldn't spend this extra $20,000 if


Tomorrow is the first day of the New Year when we breakdown our budget for 2018. 


Save Money Retire Early is written by Jon Lo, a barely 30 something change optimist, and personal finance guy. I believe anyone can be rich or poor, it's what you save that makes the difference.

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