Poopsie and I have always considered ourselves pretty frugal. We knew we spent more than we wanted to, as we lived five hours drive apart and therefore were technically maintaining two households. This meant two lots of rent, two electricity bills and two grocery bills. That starts to add up, but we still thought we were saving a fair amount, certainly more than most.
However, in early January, after returning from my trip to Tasmania, I sat down to do my usual monthly wrap up for December. As discussed in My No. 1 Piece of Advice for Retiring Early, I use PocketBook to track our expenses, categorise them and then calculate our savings rate.
I didn’t start doing this until April 2015, so I didn’t have a full year of data to deal with. However, I found our average savings rate since April 2015 and was astonished at it.
We saved 29% of our combined incomes in 2015.
Sure, I didn’t think we would hit above 70% like The Frugalwoods, but I thought we would come close to 50%.
This was a pretty humbling experience for Poopsie and I. While we did have the two households to take some of the blame, I also knew we had spent a lot of money in areas we didn’t need to. Our eating out budget was consistently around $300 a month- even though we had agreed to only eat out for our birthdays and anniversary. Somehow, we had fallen into the trap of regularly eating out without even noticing it.
I was surprised to learn that instead of being aspiring early retirees, we were in fact spending fairly closely to the average- which all of us in the early retirement community agree is wasteful and unnecessary.
Poopsie and I are now living in the same place, which should cut most of our bigger bills in half. However, to reach the savings rate we aspire to, we have a lot of cutting back to do.
Thank goodness I started this blog. Now, we have somewhere to not only provide advice and the occasional travel post, but somewhere to be held accountable and to increase that savings rate. Will you help us to stay accountable?
I intend to publish our expenses for the previous month in the first week of each month, showing what we spend our money on. Hopefully with the feedback received on this blog (or punches in the face as MMM says), we will get there sooner than we think.
Have you had a humbling experience on your road to early retirement?