This is either going to be YOUR TYPE OF POST or a complete snooze fest. If it’s the latter, feel free to skip today’s offering and come back tomorrow. If it’s your “thing” here are similar posts from Lisa, Kyria, and Rachel.
Every year there is something. Last year it was major home renovations, this year it was purchasing a new-to-us vehicle. All that to say, it feels like there is no strictly “typical” year in terms of financial outputs, but here is how things shook down in 2023.
HOW WE TRACK SPENDING
At the beginning of each month I download the transactions from our joint chequing account and our personal credit cards (one each). I move all the expenditures under the appropriate category and that same information is funneled into a summary spreadsheet at the end that gives running totals for each category, along with monthly averages.
That’s it!
HOW WE SPENT MONEY IN 2023
First, some notes:
- There are two categories that for some inexplicable reason will not show up with a legend: Life Insurance (top blue slice; 1%) and Clothes (just below Kids; 0.5%).
- This does not include personal taxes or investments in anything other than the house (so saving for future education in an RESP – which is partially matched by the Canadian government, GICs, RRSPs, TFSAs, or our stock equity in multiple companies that John has worked for).
- Since we manage our own business, phone and internet expenses are covered by our company + we get a portion of money spent on Household and Household Investments back since we maintain a home office. Those rebates are not factored into this pie chart.
- We do NOT track cash. If we find $20 on the street or I sell something at a consignment store and get a payout, we do not classify that as income. Likewise, if we buy something in cash (unless it’s a large purchase with a receipt), I don’t track it. So if I send a child into the store to buy a bag of apples for $5.99 and I give them a $10 bill, none of that transaction will show up in our spreadsheet.
Our biggest category in 2023 was Auto at 33.5% and our smallest category was Clothes at 0.5%.
AUTO (33.5%) | Last year auto was 6.6% so this is a big jump but it includes buying a new-to-us vehicle in cash (so there won’t be any carryover payments in 2024), insurance, gas, any repairs, and things like tire and oil changes/car washes for both vehicles.
HOUSEHOLD INVESTMENT (24.8%) | This includes our mortgage payments, any prepayments (we’re paying our mortgage down aggressively and can put up to 10% of our original mortgage against the house each year without penalty) and the significant landscaping work we had done.
HOUSEHOLD (9.5%) | This includes things like property taxes, home repairs, heating and water costs, and general home purchases (like furnace filters, home decor, and our water heater/propane tank rentals).
CHARITABLE (9%) | Various causes we support; one of the most special is helping to cover school expenses and basic living costs for a child L’s age in Kenya and a child A’s age in Ecuador. They love communicating via letter with these children who we’ve sponsored for about 5 years now. It is very special to watch our kids grow up at the same time.
GROCERIES (5.8%) | While this is a lower percentage of our spending in 2023, the actual dollar figure went up by almost 20% in 2023. Thanks inflation. What a blessing to be able to afford the food we want and need; it breaks my heart to see the price of things at the grocery store and know so many can’t afford even the basic necessities.
HEALTH (4.2%) | Most medical procedures are covered free of charge by the Canadian medical system (my ablation in February, for example, cost me exactly zero dollars). But we don’t have private insurance, so things like eye care and dental are only covered free for our kids. I had a wisdom tooth out in April, laser eye surgery in May, and A got braces (which is NOT covered for free unless it’s more than cosmetic) – of which about 50% is paid for up-front – in October. So Health was a much bigger spending category than usual for us.
TRAVEL (2.7%) | I don’t include gas costs (those fall under Auto), so this would be flights, meals, and entertainment on vacations. The biggest chunk of this was our trip to Rome, but this also includes our flights for Barcelona since we booked them – and paid for them – in 2023.
MISCELLANEOUS (2.6%) | Sigh. This is not great categorization. It mostly represents purchases from the Dollar Store, Walmart, and Amazon. I am too lazy to pull things apart, so this is a mix of household, groceries and gifts.
GIFTS (2%) | Self explanatory, but really a chunk of Miscellaneous belongs in here…
KIDS (1.8%) | This is things like haircuts, school fees, and other activities (summer camp, recreational sports leagues).
MEALS AND ENTERTAINMENT (1.5%) | This covers any restaurant meals, takeout, subscriptions (Spotify, Netflix, Disney+, and John’s monthly Oura ring fee).
LIFE INSURANCE (1%) | Self explanatory.
THRIFTING (0.9%) | This is the amount of money we spent at our favourite chain of thrift stores (Valu Village). This encompasses household, gifts, and clothing. I don’t tease out specific purchases, but John will also sometimes buy electronics that he refurbishes and sells for a profit.
CLOTHES (0.5%) | This also includes thrifting, but most would be from a single thrift store (Funtastic Frenchy’s for anyone local!); this is also where I would put any clothing or footwear we might happen to buy new.
And there you have it!
Your turn. Do you track your monthly or annual spending habits? If so, what was your biggest category in 2023? Smallest? Do you track cash (in/out)? What category would you like to see go up (i.e. more going toward travel) and what category would you like to see go down?
Header photo by charlesdeluvio on Unsplash
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Melissa
I do track monthly spending, but I need to do an overhaul to 1. get up to date and 2. match our categories to the form our bank gives us every year for the overdraft associated with my husband’s company. Our major expense categories last year were travel and the house (only because we did add some built-in furniture and the awning). We also like to eat out. It’s so different now from when the kids were home. We had a very sizable chunk of our income go towards schooling and activities for them so everything else was constrained.
Elisabeth
Yes, we now have ZERO preschool or childcare costs which is a major change from when the kids were younger and going to preschool! I don’t miss that expenditure.
Diane
I love these posts.
I’ve always been intimidated by tracking my spending because I feel like I wouldn’t know how find all our expenses and how I would want to break all the expenses down into categories. You make it seem pretty simple and unintimidating. (I tried to do it one year via Mint and then there was a big snafu with my unemployment check one month – I deposited the money, but the check bounced because it was too old, and they had to reissue it – and Mint kept thinking I lost money when I didn’t have it in the first place, and I couldn’t pick myself up after that.)
Maybe this is one of those I shouldn’t let the perfect be the enemy of the good because I know it would be super helpful, especially to help budget on a freelancer’s income.
I’m sure our biggest single expense is childcare.
Elisabeth
I use an accounting software (Wave; it’s free!) for our small business and did track personal spending in it for a while, but I find my Google Sheets approach works better for tracking monthly expenditures. I just copy and paste the values from the .csv transaction download into the correct category. I’d say it takes about 10-15 minutes a month. On the summary page I also summarize our total assets each month – investment accounts, remainder on our mortgage, equity in the business etc.
We don’t budget so much as we track. And we monitor what we measure so I think we naturally make some adjustments without clear intention based on the feedback we see when we track expenditures? And yes – I think I’ve done this about as simply as I could and I have ZERO desire to make it more complicated!!!
Rachel
Of course I love these posts! We should be doing more charitable giving – I need to add that as a category. Perhaps I will add it in once nursery fees come out. Also, we bought a car this year but didn’t include it in our yearly summary – that would have been 1/3 of our spending. I didn’t even think to include it.
We also don’t include money coming in (from selling things). Although I do try to track cash.
So interesting that you combine meals and entertainment. I haven’t thought of doing it like that but it’s a good idea as dining out is a form of entertainment.
I totally agree with this: “What a blessing to be able to afford the food we want and need; it breaks my heart to see the price of things at the grocery store and know so many can’t afford even the basic necessities.” When I focus on gratitude, having a house of food I can afford and like eating comes in at the top. I’m so thankful that I can spend what I want on groceries.
Thanks for sharing!
Elisabeth
We don’t eat out very much so to me it really does feel like a source of entertainment. I think if we did a lot of eating out I’d likely separate the categories! Clearly our money does not go toward restaurants and movie theatres since all entertainment TOTAL is 1.5%. I’m okay with this…especially as the cost of groceries steadily rises 😐
Kyria @ Travel Spot
I love these kinds of posts! A few things I found interesting were (1) you rent your water heater!? Is that common in Canada? We have to buy ours, but we are also in a city so gas is piped in. However, my parents live in the sticks, and they do have propane and they have the option to buy or rent their propane tanks (but not their water heater). I also had to buy my fridge/stove/dishwasher/washer/dryer. If you rent, depending on where you are, those are generally included, but some rentals make you buy your own fridge (weird right?) (2) Dentistry and eye is not covered by national health at all? Or do they only cover preventative? Usually insurance in the US covers preventative, so cleanings, exams and yearly check ups are free and anything else is $$$! (3) I love that meals and entertainment are one category and it is still very small!
Are you using Excel to make your pie? If so you may need to go to “format data labels,” “label options” and click “category name.” Sometimes it does not do it automatically at first.
Elisabeth
Most people do buy their water heater; when we bought our house, it came with a rental agreement for both the water heater and the propane tank. Now you have to buy them outright, but the rental agreement means that if anything goes wrong, it gets replaced (we’ve already had our water heater replaced once!).
Dental and eye is covered by national health in NOVA SCOTIA for kids. I think dental goes to 15 and eyes to 10 or 12. After that, if you have private insurance – which we don’t since I only work part-time and J works for a Finnish company that doesn’t have a Canadian entity or private health insurance plan – you can get a portion of these things covered. But without private insurance, it’s all OOP. Again, it’s a case of the rich get richer; most people working low-income jobs do not get private insurance plans, so they are the ones having to pay out large sums for dental and eye care (or they can’t afford to do this and their kids suffer). It’s tricky because dental and eye health are so wrapped up in larger medical health. Ditto alternative medicine; if you don’t have private insurance, you won’t be able to get free massages, therapy, chiro etc.
Doctor’s appointments, most medical procedures are completely free of charge for all Canadian citizens, though. Not a perfect system by any means, but I do feel fortunate that I never have to think about cost when I take my kids to an appointment.
We are very fortunate to be able to afford health needs OOP as needed, though I do miss the days when we had private insurance. I have avoided the dentist for over a year – I know, I know DEMERIT ALERT – because I just hate paying for a cleaning OOP.
I’m using Google Sheets. I fiddled around for about 10 minutes and then said I didn’t really care about two missing labels 🙂 Look at me being a satisficer.
Jenny
It’s interesting how different your categories are from ours (in part due to the fact you live in Canada- we spend SO MUCH on health insurance.) You’re also very good about buying things second hand and living a frugal lifestyle. I LOVE your charitable cause of sponsoring those children! It probably doesn’t cost that much (in the big scheme of things) but makes a tremendous difference in their lives.
We’re always struggling with tracking our spending, but my husband and I have a financial meeting coming up (with each other.) All you guys with your pie charts are inspiring me!
Elisabeth
We do love a good second-hand purchase. We’re fortunate to live in an area with many great options and also I feel like it’s very much part of Maritime living for people to not feel any shame about second-hand purchases!
L was still in preschool when we started sponsoring the two kids and we purposefully requested to be paired with someone that matched each child’s age to make it all feel a bit more “real” to them. I keep all the letters they send to us; it’s precious!
Beckett @ Birchwood Pie
I love seeing the deets! Like you I don’t track how I spend cash – I only count what I take out of the bank and it’s not very much. I don’t really try to manage my spending – we have teenagers so we spend a ton of money on food. Short of switching to a diet of oatmeal, rice, and beans there really isn’t a cost savings to be had there. I spent a lot on travel last year and every cent was worth it.
Elisabeth
Thankfully, I love oatmeal – even with all that oatmeal consumption in our house, grocery costs are rising. I guess we are eating more as the kids get older, but even staples have gone WAY up in the last 12-18 months.
Travel and general experiential events (tickets for a sport or arts production) are almost always lasting investments!
Sarah
Love these charts. Every time I read a post like this, I want to make my own charts, but I never follow through.
Elisabeth
I would LOVE to see a chart like this; I imagine spending varies a lot when so many kids are involved!! I can’t imagine your grocery bill!!!
M
Oh, I love this and all talk about financial planning, etc! LOL My husband and I are/were accountants so this comes naturally. Every morning, I read personal finance/invesment articles as I drink my coffee and relax/get ready for the day.
I love seeing others’ spending/tracking of expenses, etc. I am glad that there are people like you who are willing to share — some don’t like to talk about finances at all! But anyway, great job tracking your expenses…and I agree with your response to a previous comment — even though you don’t budget, by tracking, you’re made aware to see where you need to make adjustments.
I retired mid-year last year, as soon as I became eligible; my husband “retired” (I put this in quotes because in my mind, “retired” means you’re receiving some retirement income and he didn’t for 15yrs) a while ago. I have about a decade before I could qualify for Medicare so I had to wait for retirement eligibility so that my company would continue to provide the same benefits it provided while I was employed with my health insurance; I also have the option to carry my company health insurance as secondary to Medicare then. It still costs a lot (about $1K per month) but it’s a good insurance and something like this would cost 3X as much or more if we’re paying it all on our own. My son will be done with school in the spring and will hopefully get a job that will provide health insurance — it’s such a big expense/consideration!
I really admire your frugal lifestyle, like the thrifting and how you much you save with the travel arrangements you make! Great job!! I told myself that I won’t need so many clothes/shoes once retired…but maybe it’s still too new because I seem to be spending as much, if not more, on clothes. Maybe I’m thinking it’s a different lifestyle and therefore requires new outfits? LOL
Elisabeth
I had to chuckle that financial articles are your way of easing into the day!
Not having to pay OOP for most medical procedures makes a BIG difference, for sure. Though I do think taxes and COL are generally a bit higher in Canada? Definitely in the major cities! So there are always tradeoffs (again, unfortunately, it’s the people who are struggling to make ends meet that get the short end of that stick and affordable housing is at a tipping point in Canada right now)!
I think our general budget approach is let’s spend as little as we can while still really enjoying the best that life has to offer. So we say yes to the trips (finding ways to save lots of money), but no to new clothes because we prioritize different things.
Happy retirement shopping 🙂
NGS
I track my own spending, but we do not have a household budget. Because my husband and I have separate accounts, it’s harder to get precise numbers. I’m unwilling to ask my husband to log his spending the way I do, so right now I have only sort of superficial knowledge of what our spending looks like (I know it’s $X for the mortgage and $X for the car payment [but now that I think about it, I know my husband pays extra towards our car payment every month, but I don’t know how much], but I do not know about fluctuating bills or my husband’s spending on clothes, etc.), so this look at a total household is fascinating. I guarantee our health expenses would be more than that!
I do account for cash. I’m very persnickety. LOL.
Elisabeth
Persnickety – what a gem of a word.
It would be MUCH harder to track if we had separate accounts. We have separate credit cards, but I have his info (bwhahaha) and I’m the one that exports all the transactions. I also manage paying both CC’s (+ our corporate card). While he’s aware of everything and helps with any investment strategizing, I manage all the day-to-day monitoring.
Nicole MacPherson
I do track my spending, although we did fall off a bit over the past few months with the move, retirement, etc., etc. Food is a huge expense for us. Percentage-wise I’m not sure what it is but it’s enormous. I just recently started tracking my beauty spending, after Engie and Suzanne talked about theirs. I am curious but I already know it’s going to be way over the average. Maybe I’ll write a post about it in a year! Yay for content!
Elisabeth
I am already looking forward to that post – whether it takes a full year to get here. I will be reading!!!
coco
Very interesting to see your expense split. I think it reflects pretty well the stage of life we are and our priorities. I track monthly and yearly in excel sheets. Our biggest expense category has always been travel followed by kids activities. I am happy with this as they are aligned with our values. We spend more than average on groceries as we eat mostly at home, whole food, which I am happy about too.
For the future, I want to spend more travel/experience with friends. It’s not easy as all my friends live in other countries, but maybe it worth the effort to invest in those.
Lisa's Yarns
You know I love this kind of content! I use mint to track our expenses. I previously only had my credit cards/accounts on mint but then Phil would see my Amex bill and ask what in the world I bought the previous month. He was asking mostly out of curiosity but it felt like he was judging me (and it wasn’t like I was buying anything fun – it might have been swimming lessons tuition or diapers or what have you). So I gave him the login info to my mint account and he added all of his accounts so now we have a snapshot view of our finances that doesn’t require too much manual work out of either of us. Mint does a pretty good job of categorizing things, but I will have to go in and change the classification of an expense, like if an Amazon order was for gifts, etc.
Besides buying a car, childcare was our largest expense but it’s worth every penny. I don’t know when that expense will go away, though… We are away from the home for 10 hours when we go to work so I don’t think we can do without before/after care for quite some time… But I’ve kind of accepted that we have to spend a lot on childcare because of our jobs and eventually that category will really decline!! And then we can spend more on travel hopefully (we don’t need childcare expenses to go down to spend more on travel; it’s more so that when our kids are old enough to not need before/after care, they will also be at ages where travel is far more enjoyable).
Elisabeth
I DO know you love this sort of content and your post was the first to inspire me to do one of my own <3
Yes, we have very low childcare costs (I mean...it's basically zero), but that comes with other tradeoffs, of course!
Stephany
I love posts like these! It’s so interesting to see how people spend their money and how differently everything shakes out depending on what’s important to people. My biggest category is rent/household bills but my food budget comes in second. I spend a lot on food, but I’m okay with that!
Elisabeth
Food costs a lot!
San
I love these kinds of posts and I love pie charts and it’s all so fascinating to me.
I love seeing how other people spend and prioritize money and while I understand why people don’t share actual dollar amounts, I always marvel a bit at how different these percentages shake out. Our grocery percentage is HUGE… but then again, we don’t have some of the categories other people have, so maybe the actual money amounts are not THAT different. I dont’know… I haven’t done our breakdown for 2023 yet (although I downloaded the numbers) and I am curious about the grocery spending because I feel like EVERYTHING went up last year.
Elisabeth
Yeah – our grocery percentage went down but overall spend on groceries went up. I think it was about $800/month (which works out to $200/head/month) in 2023 and only about $650 in 2022?
Anne
I have been inspired by you, Stephany, Lisa, and Kyria to track my as-close-to-exact spending as possible in 2024. I want to know where my money is going.
I also need to hit up Kyria and Birchie for recommendations on money management for women… sigh.
Thanks for inspiring me/reminding me why I refuse to consider buying a car/house/anything until I can do so with minimal long-term impact on my finances. 🙂
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