Lots of Talk on Saving and Income, let's chat Spending

will888 wrote: ↑ That is pretty frugal. My budget is a little more generous that that. The miscellaneous category is wide in scope purposely for simplicity and compliance. The following are per month numbers.

Housing (utilities, telecom services, insurance, taxes, repairs): $2500
Food (groceries and restaurant meals): $1500
Transportation (gas, maintenance, insurance, replacement): $1500
Leisure and travel: emergency fund
Miscellaneous (anything not in the above categories): $1500

The housing and transportation file can have lumpy expenses if repair/replacement bill rears its ugly head. Otherwise funds not spent are allocated to the emergency fund which rises and falls over time. The emergency fund is heavily resourced because the PLC is included as a second level defense in depth. If there is too much cash reserve, it gets invested to improve future cashflow.

speedyforme wrote: ↑ How is food so high? I personally don't think we eat cheap but we do buy stuff on sale and stock up (we have a chest freezer). Would would you consider to be a high expense in food category for your food habits? Eating out or certain cuts of meat? Organic?

I may have forgotten to share we have 1 car only.

My transport of course doesnt budget long term things like a replacement car and things of "emergency" too like a new appliance if something breaks etc.

So can you imagine us trying to go from $4k a month to $10k when we retire? LOL

will888 wrote: ↑ That is pretty frugal. My budget is a little more generous that that. The miscellaneous category is wide in scope purposely for simplicity and compliance. The following are per month numbers.

Housing (utilities, telecom services, insurance, taxes, repairs): $2500
Food (groceries and restaurant meals): $1500
Transportation (gas, maintenance, insurance, replacement): $1500
Leisure and travel: emergency fund
Miscellaneous (anything not in the above categories): $1500

The housing and transportation file can have lumpy expenses if repair/replacement bill rears its ugly head. Otherwise funds not spent are allocated to the emergency fund which rises and falls over time. The emergency fund is heavily resourced because the PLC is included as a second level defense in depth. If there is too much cash reserve, it gets invested to improve future cashflow.

FarmerHarv wrote: ↑ Here's our current budget. Retired early(ish), no kids, no pets, living on the farm/acreage in the middle of nowhere. Might be some overlap between food and Costco after seeing you all discussing food prices, otherwise I think everything I pretty close.

FarmerHarv wrote: ↑ Here's our current budget. Retired early(ish), no kids, no pets, living on the farm/acreage in the middle of nowhere. Might be some overlap between food and Costco after seeing you all discussing food prices, otherwise I think everything I pretty close.

speedyforme wrote: ↑ Wow clothes and personal seem high. Thanks

smartie wrote: ↑ I am always fascinated by farmers life, just wondering do you still need hire temporary workers to maintain your farm? How do you plan to deal with farm when it's too big for you to maintain?

Thanks

FarmerHarv wrote: ↑ We never did get very large, only 1800 acres of crop so it was easy to manage and operate with myself and Farmerette, and father would come out for a few hours a day during seeding and harvest. The bigger operations (10-20,000 acres and up) look for help during those times, lots of Australian, Danish and some other assorted European accents can be heard in the local pubs in the spring and fall. The hundred thousand acre plus farmers have year round staff though to keep things going.

smartie wrote: ↑ Are those your budget numbers or actual numbers? If it's budget numbers, what's your average spending actually

Also, thanks OP, great topic

will888 wrote: ↑ The food item is quite accurate. Housing, transportation and miscellaneous is all over the map due to lumpy spending and the fact that spending has unplanned elements. I don't really concern myself with exactness when that can only be determined accurately after the fact. How do you plan an appliance or car breakdown? Long story short, I compare the budget to long term expected returns on investments. In any given year, the number is probably totally out to lunch. In the long run, it's about right.

smartie wrote: ↑ So it's your actual spending with emergency fund built in?

will888 wrote: ↑ Yes, the emergency fund does have cash. The target net income is designed to supply roughly the budget. It's the allocation for the lumpy spending items that allow the more predictable days to day spending to also be lumpy without impact. I don't think it's feasible or practical to have a budget with supposedly exact amounts in each and every category. That's a set up for failure.

DealRNothing wrote: ↑ Noted Dec Headline Inflation today... What's yours?

It's actually an interesting exercise for "Personal Inflation Calculations". Consumers, investors are bombarded with inflation data of various types (Core, CPI, PCE, etc) that may or may not reflect personal spending / effects. How many actually know "their" baseline Personal Inflation Rate?

If you go to StatsCan, there is a Personal Inflation Calculator (CPI compare base) to enter personal expenses and come up with "your" Inflation Rate. This might give you a better idea of how Inflation is personally affecting you. For example, inflation was led down by gasoline prices recently but if one takes public transit, did one's inflation rate go down?

The calculator is a useful tool in drilling down to personal inflation / spending categories and whether personal budget changes could mitigate.
Personal Inflation Calculator_StatsCanada

Likely some surprises (up or down) against headline reads.

will888 wrote: ↑ Yes, the emergency fund does have cash. The target net income is designed to supply roughly the budget. It's the allocation for the lumpy spending items that allow the more predictable days to day spending to also be lumpy without impact. I don't think it's feasible or practical to have a budget with supposedly exact amounts in each and every category. That's a set up for failure.

speedyforme wrote: ↑ 100% agree with you. My annual "budget" is basically a copy of the previous year spending with some "known" changes if I expect them like vacation costs or other things. Otherwise all we do is track spending as info.