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The good, the bad & the ugly: My 2011 expenses

December 27th, 2011 at 11:53 am

Some of you may know I keep meticulous track of my expenses, all year long. Income too, of course.

Here is the big reveal of my ranked expenses for the year, a few days ahead of schedule, along with a few side notes:

1. Mortgage/taxes: $14,177
This doesn't include a lump sum payment of $17k I took from savings.

2. Vinyl siding: $13,789
Even going with the lowest bid last summer, the results of which I'm very happy with, this was still enormously expensive. This also came out savings.

Something needed to be done as the house was peeling again and it's difficult to prep asbestos shingles the way you should when paint is already peeling, so I opted to remove it once and for all and go with vinyl. The 1/2 inch foam insulation was well worth it, IMO, as I've noticed it helps muffle outdoor noises and I feel pretty comfortable with indoor temps of 62 days/57 nights, which in the past would be on the chilly side.

3. COBRA and out of pocket medical expenses: $6,807
This figure just makes me cringe. It represents a 64% increase over what my medical expenses were last year. That's because last year I enjoyed the federal COBRA subsidy, which went away in 2011.

$835 of this is for out-of-pocket co-pays. One thing I've learned is that when an insurer tells you "it's 100% covered," it's really not. This was all routine check-ups except for a stubborn yeast infection and Lyme Disease that had to be treated.

4. Food: $2,591
On the plus side, I spent just about the same amount on food last year. This works out to an average $215 a month for a single person. I'd like to do better, given that it's my #4 expense, but when the average person goes grocery shopping at least 52 times a year, it's hard to shop smart each and every time.

5. Heating oil: $1,117
This represents a 20% decrease compared to last year, but I think most of the savings can be attributed to the fact that I skipped my annual furnace tune-up this year.

6. Home maintenance: $959
I regret forking over $360 to a couple of guys who removed a foot of snow off the roof of my house after one heavy snowstorm. Everyone was doing it after the news repeatedly showed the shallow-pitched roofs and the roofs of old barns caving in from the weight of the heavy, wet snow. Another big chunk of this was miscellaneous small handyman jobs I had someone do, part of it related to damaged caused by the ice dams in the gutters from the same storm.

I have since purchased a snow rake and intend to get out and use it as soon as there's more than a few inches on the roof so the same thing doesn't happen again, especially since I also spent money getting paneling in 2 closets damaged by the melting ice.

7. Cats: $837
This just boggles my mind, considering neither of my 2 cats had any health problems this year, except I did take Waldo in for what turned out to be allergies. The vet is enormously expensive. Still, this figure represents a 40% decrease from last year, when I think there were more trips to the vet. On the plus side, i purchased an extra YEAR'S worth of cat litter at Costco this year because I won't be renewing my Costco membership, and they have very cheap cat litter.

I love my cats dearly, but I don't think I would again adopt a 2nd cat so lightly.

8. Household: $827
I was shocked that this figure includes $350 spent on an upholstered chaise lounge for my sun room. I remember that I'd been wanting to get something comfortable for the room once it was finished 2 summers ago, but I haven't been working f/t for 2 years. Then I remembered that my work at Big Company was in the last quarter of 2010, so no doubt I was feeling "flush" with cash and decided to indulge. And there was a time when I was quite sure I was going to get an offer for a permanent position there, since they let the other 2 contract writers go and kept me to the end, and I kept getting good feedback. But it didn't work out that way.

9. Electricity: $744
Connecticut is known for having some of the highest electric rates in the country. Remember, I use oil to heat my house. Fortunately, I'm signed up to receive a $100 to $200 credit on next year's electric bills, compliments of CL&P after most of us went without power for 7 days during Irene in August and the snowstorm in October. The exact amount depends on how many people sign up for it. Why we should have to sign up, I don't know. The power company knows who was out of power, so why make it contingent on someone hearing about the credit or not?

10. Sewers: $738
This is high because it includes ongoing usage fees as well as payments on a mandatory $9,900 loan residents in certain neighborhoods had to take out to pay their share for a new sewer treatment plant. I should be through paying off that stupid (2%) loan in another 5 years.

Those are my top 10 expenses, ladies and gentlemen.

Then there's the:
Homeowners insurance: $691
(reflects $5,000 deductible)
Paneling 2 closets: $644
Phone and Internet: $586
Gas for car: $571
This represents a 31% decrease from last year. I've been successful in consolidating errand trips! Plus, I guess prices have come down.
Washing machine: $514
Auto insurance: $447
It keeps creeping up despite a 12-year old car with no collision and a perfect driving record!
Car tax and AAA membership: $280
Water: $196
Car upkeep: $195
Borough taxes: $165
Dining out: $82
Dump sticker: $80
Cable TV: $62 (cancelled it entirely in August)
Clothing: $62
Haircuts: $58
Gardening: $47
Vacations: $46 (this was cost of gas to visit dad on Jersey shore)
Gifts: $29 (Yup, that's all I spent on Christmas this year)
Bird feeding: $15
Subscriptions: $10 This was a special they had on a year's worth of Sunday newspapers. I thought I could recoup the cost from grocery coupons. Don't think it was worth it.
Entertainment: $6 This was 3 movies I saw at the $2 movie theater.

Total Expenses: $48,222
Not including the vinyl siding: $34,433

Next: My income, analyzed

7 Responses to “The good, the bad & the ugly: My 2011 expenses”

  1. Ima saver Says:

    Gosh, you keep great records!

  2. CCraw Says:

    Very impressive record keeping!

  3. Dido Says:

    So how do you keep track of your expenses? Do you use one of the dedicated programs like Quicken, or what?

    And why the extra 17K mortgage payment given your employment situation, if you don't mind my asking?

    The vinyl siding job came out nice, even if it was the "cheap" contractor!

  4. patientsaver Says:

    No, actually I've been tracking my expenses for so long that I long ago created my own system. It may be simple, but I know it well and it works well for me. I just created a template form in Word to track expenses monthly. It contains all my different categories of expenses on 2 pages and Income on a third page.

    At the end of each month, I tally everything up, subtract Expenses from Income and transfer the category totals to my Master income and expense sheet. Then at year's end, I use the Master sheet to tally up all expenses and income for the year.

    I made the extra $17k payment on the mortgage because I'm still paying 6% interest on this 30-year, fixed rate loan. I had refinanced twice in earlier years, but would not be able to refinance again due to my being out of work.

    I remember looking into it in 2009,when I was still working, but even then, the approximate $4,000 in fees was a turnoff. About $1,000 just for the attorney.

    Besides, even before I made that big lump sum payment, the mortgage balance was already under $50K, and I figured that a refinance costing about $4,000 wouldn't be worth it, and I found by calling around that some banks wouldn't even be interested in refinancing such a "small" loan. (Small to them, not to me.)

    I've also been very anxious to pay this down and pay off the whole mortgage sooner rather than later, because not having the mortgage would make meeting my monthly expenses much easier, especially if I'm still unemployed. I keep thinking about what could happen when my unemployment benefits finally run out (around April at the earliest...I'm not sure if the recent Congressional vote to extend benefits for another 2 months affects me or not).

    Add to that the fact that my taxable mutual funds aren't earning much these days, compared to the 6% I was paying in interest each month, and it seemed like the right thing to do.

    I still have ample taxable savings, although I certainly don't want to tap those if I don't have to.

    So, what do you think of all that? Do you agree, or not?

  5. Dido Says:

    Wow, that's amazing high fees for a re-fi. I guess those go up with the value of the home?

    I'm in the process of a refinance. My home value is about a third of yours (smaller house, much less land, and, mostly, PA vs CT), and the highest closing cost I heard was about 2K. But I'm doing it thru Wells Fargo, where I already have the mortgage, and, as part of a customer retention program,, there *are* no closing costs. (Nothing hidden. I actually went through the application last year all but actually sending it in, because, being underemployed at the time, I was worried that things would come back to bite me. I have the HUD statement, and while they list costs in one box, they also subtract them in another, so I do feel confident that it really is free. On the other hand, they offered me 4% on a 20 year refinance, and I did estimates from other places for 3.75% on a 20 year refinance. My loan balance is about 80K, so that's the difference there. But if I transferred my loan to another institution with lower rates, I'd also lose my waiver of checking account fees and the free security deposit box that I get as a benefit for having my mortgage with Wells Fargo...plus, I'd have to go through the hassle of getting another apprasial, etc. Here all they might ask for are copies of my pay stubs and tax returns because of the recent job change, plus of course they'll pull my credit report. All in all, I don't mind the extra quarter percent interest given the alternative. And I'm very happy to be able to simultaneously cut 4 years off my loan term, cut my interest rate, and cut my monthly payments by about $50 a month.

    I can understand about not wanting the mortgage balance in case you do run out of unemployment, but then why not pay the whole thing off with funds from the taxable account?

    The other side of debt is leverage, but 6% is a high rate these days so harder to take advantage of the potential benefit. I was really thinking about taking that extra $50/month I'll save when I refinance and keep paying it toward the house, but then I read Bert Whitehead's book on Facing Financial Dysfunction over the weekend where he talks about "mortgage aversion" as one such fear because of the opportunity cost and the fact that your assets then become concentrated in the real estate sector instead of being broadly diversified, so after reading that, I changed my mind and decided to up my retirement contribution by $50/month instead. But I'll be able to take advantage of the difference between the 4% loan and an investment that will hopefully pay more than that, and these days, you're right, it is much harder to get the benefit when you're already paying 6%.

    It's a hard balance between using the money to maintain liquidity vs to invest (whether in the asset of your home or in some other asset).

  6. patientsaver Says:

    Did, I don't think refi costs should go up with the value of the home; i think it's the individual bank, maybe, that simply decides they want to make more money off the re-fi.

    In answer to your question about why hot just pay the whole mortgage off then (good question)...i did consider that, too, but it has to do with striking a balance between moving toward my objective of paying off the mortgage and still keeping some liquid assets available to me should I need them. That taxable account of $67K is now all I have. I already tapped it to withdraw the $17K for the one lump sum mortgage prepayment, and withdrew another $13K for the vinyl siding. Should my 12-year-old car die unexpectedly, that's where the money would come for a new/used car. It's just another $10K, but i guess at this point I want to preserve those liquid assets and just be happy the whole mortgage will be gone in a little more than a year.

    when you're working steadily, liquidity is just so important, as I'm sure you know. I don't want to be caught short-handed should the unexpected arise. Murphy's Law says it will. One small example: my dryer dying on me, and the washing machine earlier this year. They're small potatoes, but when i have no way to replenish the funds, I don't want to keep pulling from it.

    I have to say, PA seems like an inviting place to retire due to the much lower real estate costs you've mentioned.

    I understand and agree that having a fully paid house could mean your assets are narrowly diversified. But owning the home free and clear is important to me. I am debt-averse, and mortgage-averse too!

    Once the home is fully paid, I'll be plowing more into savings (hopefully) and i won't be investing in REITs!

  7. patientsaver Says:

    I meant to say, when you're NOT working steadily, liquidity is so important...

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