Here’s How We Spent $40,885 (2019 Annual Spend)

Our 2019 budget reveals how we live luxuriously, with a mortgage! A deep analysis of how we—two 35-year-olds in an MCOL city—spent $40,885 in a year.

Ah yes, the annual spending review. Jenni and I have been tracking our spending independently and comparing it for nearly a decade. Surprisingly, our pre-retirement budget has trended downward over the years. We feel we lead an exceptionally luxurious life as two 35-year-olds jet-setting around the world!

→ See our newer FIRE Budget

While we rather be frugal than cheap in our spending, neither of us feels constrained. We have saved, invested, or paid down debt with more than 50% of our income for more than a decade. 2019 is our last pre-retirement spending year.

Since 2016, we’ve been more intentional about tracking expenses. We’ve combined our spending into shared categories so we can track our annual outlays together. It helps us understand where our money is going and identify any trends developing—like if our restaurant spending has been on the rise. With this information, we can make some adjustments to account for changes. Sometimes those adjustments are as simple as increasing our forward-looking projections. Other times, we look at ways to reduce or sustain the spending at current levels.

If you enjoy this deep dive, be sure to check out future budgets (update: latest FIRE Budget).

We hope you can find some tricks in our spending to help you live below your means. We’ll go through all the numbers again and pick our tips and tricks to achieve FIRE, stay tuned by signing up for our newsletter and you’ll know when we drop the latest edition!

2019 Annual Budget

Budgeting and expense reviews don’t have to feel like pulling teeth! We often incorporate conscious spending in our annual budget, increasing budget categories we find more value or happiness in like travel or cultural experiences. That makes for a more positive financial discussion and planning time as a couple.

It’s one of our secrets to progressing through the 7 steps to financial freedom.

Before we get started on the details of our annual budget, let’s take a look at a high-level overview of our spending. The pie chart below will give you a bird’s eye view of our annual budget.

Understanding our expenses

The expense table below is grouped by parent categories (leftmost column), subcategories within that parent (middle column), and the amount spent. Parent categories are totaled on their row, summing all of the subcategory expenses below it. Parent category names are linked to a short discussion about that category which follows the table.

As a point of reference, we live in a medium cost of living, medium-sized city in Virginia, in the United States. We chose city life over country life: we generally walk to entertainment, parks, and stores.

2019 Categorized Expenses

CategorySubcategorySpent ($)
Home 20,349.98
 Mortgage Principal3,873.84
 Mortgage Interest5,813.31
 Property Tax3,312.00
 HOA Fees4,200.00
 Lawn & Garden0.00
Food & Dining 8,193.70
 Fast Food439.40
 Alcohol & Bars582.33
 Coffee Shops50.44
Travel 1,633.52
 Air Travel(786.54)
 Rental Car/Taxi279.40
Health & Fitness 5,030.55
Bills & Utilities 1,719.31
 Mobile Phone207.87
Auto & Transport 2,076.13
 Gas & Fuel355.78
 Service & Parts721.85
 Property Tax149.88
 Public Transportation117.04
Entertainment 667.14
 TV & Movies74.10
Shopping 600.28
 Electronics & Software281.77
 Sporting Goods32.49
 Toys & Hobbies31.00
Gifts & Donations 508.00
Personal Care 106.39
Fees & Charges 0.00
 Bank Fees0.00
 Service Fees0.00
Major Unbudgeted Expenses1  
 Car purchase, cosmetic surgery, yacht, etc.0.00 
Subtotal2 31,197.85
GRAND TOTAL 40,885.00
4% SWR Basis3 1,022,125.00
(1): Large, unplanned and unbudgeted expenses can come up but should be infrequent.
(2): Defined as all expenses minus mortgage interest & principal—if we paid the mortgage off this is what we’d have spent.
(3): In order to maintain this level spending, we’d need this much in appreciating assets to meet the classic “4% rule” (25x our annual expenses, the Grand Total number)

Budget Breakdown

The numbers are only half the story. Each parent category from the budget table is broken down below. We hope it offers some detailed insight into each category—and subcategory—of spending. There are certainly some morsels of sneaky spending strategies buried in these paragraphs. If you’re not interested in those details, skip down to our overall review of our 2019 expenses.


The Home budget category covers all things related to our housing. Our home purchase in 2013 included a 20% downpayment with a mortgage for the balance with a 30-year fixed rate APR near 3.8%. With a low interest rate, we don’t try to pay off our mortgage instead of invest.

Our property taxes rose slightly due to a reassessment. Our home insurance is through Geico. The purpose of the coverage is to mitigate a total loss so it generally matches the dwelling replacement cost. We also have our vehicle insurance through Geico and earn a shareholder discount on the combined bill, though I’ve broken out auto & home insurance in our budget.

Approximately 1% of the value of the dwelling is budgeted for home improvement and services combined (so 0.5% per). According to the budget above, we anticipate $96 per month for each improvement and service. So, $192/month over 12 months means a total of $2,304 per year, equating to a $230,040 dwelling.

A lot of folks don’t properly plan for hidden homeownership expenses like maintenance and improvement when making the buy vs rent and invest decision.

Our monthly HOA fee may seem exceptionally high at a glance, but it covers a lot of expenses that are often separate. In addition, our HOA is managed internally by fellow owners and management does not take any sort of compensation. All fees just flow back to owners, usually in a more efficient way, through combined billing. For example, a single commercial water boiler provides hot water for everyone. The fee includes our heating, water usage, landscaping, common area maintenance, garage maintenance, gutter cleaning, and a few other small benefits. Our neighborhood was originally setup as a cooperative in the 1920s. Fortunately, we continue to have a good relationship with our neighbors.

Our other small housing-adjacent categories had low costs for the year. We didn’t add new gardening projects. New furniture was gifted or costs were negated by selling other pieces we already had. This often happens when we replace or upgrade something we already have. For example, we might buy an older hardwood bookshelf, fix it up, then sell a modern pressed wood bookcase and wind up with zero net expense. We frequently use websites to sell stuff locally to reduce our net cost and avoid throwing stuff in the trash. Supplies include cleaning items, paper towels, and so on.

Back to the expense table >

Food & Dining

Grocery expenses saw the largest year-over-year decrease for us within the food & dining category. We each made an effort to take better advantage of rebate systems like Ibotta that kickback a few bucks when buying certain products and submitting a receipt to prove it. When combined with digital coupons at our local Kroger, we often wound up with free food. That meant we got to try new things and add a few luxuries we wouldn’t normally buy. We routinely rotate credit card bonuses in the grocery category as well, which meant, sometimes we were getting paid to try new food overall. Our guide to saving money at the grocery store walks through all the details. It was a lot more work—we’ll see if we keep it up in 2020.

I’m often a little disappointed to see our expenses from eating out remain relatively high. We very rarely go to a restaurant with just the two of us—perhaps a few times per year. When we’re feeling lazy we might get takeout if there’s a promo going with the latest Uber-for-food app a few times per month. Most of our restaurant spending is really gifts or a way of saying thanks to friends and family on special outings like birthdays or holidays. It’s also a good way to say “thank you” when we stay at their place.

Saying “thanks” bleeds into our alcohol budget, too. But, we do make a couple trips per year to Total Wine and blow $100+ to stock up on hard ciders and boxed wine.

We’d estimate that roughly half of our restaurant expenses occur when we’re traveling. A key point of interest we establish for every new home base is the local grocer, but we like to experience the dining out culture of a new country or region. It’s a luxury we enjoy when we’re somewhere new.

Back to the expense table >


Our travel expenses look a lot lower than they really ought to be, considering how many places we’re lucky enough to visit annually. Here’s a quick list based on our photo library for 2019:

  • Flew to visit family in Rochester, NY for an extended weekend
  • Spent New Year’s in Williamsburg, VA celebrating
  • Sailed on the bay in Annapolis, MD for a weekend
  • Absorbed the end of the summer on Wrightsville Beach, Carolina Beach, and Wilmington, NC for five days
  • Trundled down the coast in an Amtrak Sleeper Car to tour Savannah, GA for an extended weekend
  • Hid from the world on Eleuthera in the Bahamas for nearly ten days with a couple of friends at a very fancy pants resort
  • Chris visited friends in LA, then drove off to Utah to spend ten days hiking Arches & Canyonlands national parks with skiing in Park City
  • Turned a friend getting married in Mexico City into a week long trip exploring Teotihuacán, Taxco, and San Miguel de Allende in Mexico

Rochester, Eleuthera, LA, Salt Lake City, and Mexico City flights? Booked with miles. During family and friend visits, we stayed with them, often offering a restaurant or bar outing as thanks. NC, GA, and UT hotels? Booked with Marriott, Hilton, or IHG points and annual free night certificates. Mexico was a combination of Hilton (the first time we’ve used Hilton Experiences bidding, which was a once-in-a-lifetime experience in Mexico City during independence celebrations) and AirBNB. Amtrak’s Sleeper Car was paid with Amtrak Points earned from their shopping portal. The fancy resort on Eleuthera was paid with a Hotel + Air certificate from Marriott.

Even ignoring numerous additional small trips around Virginia, that’s a total of about 40 days traveling, mostly with two people. At a total recorded cost of $1,633.52, that’s less than $25 for each of us per day. Who said travel has to be expensive?

We anticipate much of 2020 will be limited to travel within driving distance. Fortunately, we have a lot of staycation ideas that we’d like to execute.

Back to the expense table >

Air Travel

We wanted to highlight the Air Travel subcategory since it’s shown as a negative value in our expense table. That may seem like an error. In this case it’s explained by a combination of two things: 1) our flights were paid with miles and/or points throughout the year, so they had no direct cost and 2) there were multiple instances of friends or family asking us to book their tickets along with ours, saying they’d reimburse us. With the second case, we still booked their tickets with miles and/or points and they reimbursed us with cash.

That makes for a wonky air travel budget. On the surface, it may seem like we’re charging people for our “free” points/miles. We are effectively charging for those points/miles, but they’re not free. Often their cost is reflected in the credit card annual fees we pay (which are in our expenses tied to the credit card category: a hotel card annual fee appears as a hotel expense). We also could redeem the points for cashback. We often insist on offering a small discount, too, so everyone benefits.

Back to the expense table >

Health & Fitness

Chris’ health insurance is reimbursed by his business but is still reflected in our personal expenses as its initially paid out of pocket. It’s for a grandfathered (pre-ACA) high deductible health plan (HDHP) that is HSA eligible. Dental expenses were primarily for dental insurance for Chris.

The Sports subcategory includes expenses for events like 10K race, obstacle course, or fun run registrations. It also includes membership to a rock climbing gym and fitness classes. All of those are certainly a luxury.

Jenni’s health, dental, and vision insurance were still paid for by her employer in 2019 (she’s made the jump to COBRA after analyzing early retirement health insurance options). Neither of us experienced significant health-related expenses in 2019.

Back to the expense table >

Bills & Utilities

Our HOA fee includes many traditional utilities or monthly maintenance fees like landscaping, water, and heating. The utilities subcategory includes our electric, gas (cooking), and wastewater bills. We tend to keep the A/C at 73-75 degrees during the spring-fall period, use ceiling fans, and try to use the windows as much as possible. A Nest thermostat helps us manage and monitor A/C usage.

We have two modern Apple iPhones and use pre-paid SIM cards for each. The provider tends to change as we switch between promos, but in 2019 we were both using 1GB FreedomPop plans that were $50 annually. There’s some extra expense for upgrades as we sell a slightly older phone and put the funds towards a replacement. We tend to do this every year or two.

We have no cable television and we use a local ISP for internet service. Sometimes, we switch ISPs to take advantage of new promotions. We had 100mbps service for most of 2019.

Back to the expense table >

Auto & Transport

Jenni works only a few miles from home and tries to bike when the weather is nice. Chris works from home, rarely driving. We do basic vehicle maintenance ourselves. We own two vehicles though one of them is likely a waste.

T-Tops and a manual transmission are a luxury a little tough to give up, though.

Our car insurance is through Geico with a combined discount from our home insurance and shareholder discount. We maintain low coverage levels for our vehicles themselves as they’re well used loved.

Our home city is a little weak with public transport (though improving!). We do use local public transport frequently when traveling to avoid the cost, and more importantly, the stress of driving.

Back to the expense table >


We watch a lot of YouTube, but we occasionally find a promo for Hulu or Netflix. We like to visit our local 1920s movie palace that has cheap second-run films. If we’re itching to see a current movie, the nearby modern theater has $7 tickets on Tuesdays.

Amusements and Arts subcategories cover our tickets to festivals, theme parks, theater performances, museums, and memberships. This is an area we both like to spend on as a luxury.

Back to the expense table >


Apps and games (there are some video games that are good for you!) for our many digital devices provide ways to be productive, consume information, and even have some fun. We get great value out of these things but have to be careful they don’t become time vampires. Occasionally we need to replace a dead keyboard, mouse, or gadget, too. Chris uses a desktop workstation that has been slowly upgraded since 2011.

Chris’ clothing budget, at some point, was four digits when working downtown at a traditional employer. Now, those suits collect dust (and moths, sadly). T-shirts and jeans are a lot less expensive!

Jenni continued to work a full-time professional position requiring the occasional business attire purchase in 2019. Careful clothing care (hand-wash mode for your knits, hang-dry!) has greatly extended the life of our clothes.

Sporting goods includes sport-specific attire (e.g.: rock climbing shoes, harness).

Back to the expense table >

Gifts & Donations

A lot of our gifting winds up in other categories (restaurants, alcohol, groceries, and travel especially). We also net-out the gift budget when we receive a small cash gift.

In general, our donations continue to be fairly low in absolute cash terms, though that may change as we analyze the best way for us to “give back” and build a donor-advised fund.

Back to the expense table >

Personal Care

Chris cuts his own hair. Jenni occasionally goes for a luxurious salon experience, but it’s rare. Makeup and other bathroom-adjacent personal care items are included here.

Back to the expense table >

Fees & Charges

We maintain no-fee checking and savings accounts. Sometimes it’s worth bank service fees to receive signup promotions or other incentives. In general, we’re happy to see fees and charges at zero.

Back to the expense table >

Major Unbudgeted Expenses

Occasionally, very large expenses pop-up that aren’t frequent nor part of an explicit budget category. For example, if we purchased a yacht, that doesn’t fall in an existing budget category and would likely bust our annual budget. It’d also (hopefully) be an infrequent purchase so we tend to break these out. As a more realistic example, Jenni sold her daily-driver Scion some years ago. She upgraded to a used Prius.

Back to the expense table >

Budget Expense Tracking

Are you interested in tracking your spending like we do? Since 2007, we’ve used to track our expenses, income, and investments. It’s where all the numbers in the table come from. Nearly all of our spending is done with rewards-generating credit cards which makes it easy to digitally track every penny spent.

If you’re interested in the annual budget format presented, we’ve made the original Google Spreadsheet available to the public. You can make a copy of it to enter your own spending data and more easily categorize spending like we have. The spreadsheet is setup for tracking two people’s separate spending, which is then added together. You could easily use this sheet with one person (or shared accounts) by simply leaving the other person’s column zeroed out. You can also download a copy and use your favorite software like Excel or Numbers to make your edits locally.

2019 Spending vs our Budget

In general, we’re both quite happy with our spending from last year. We attempt to practice a conscious spending strategy. That means, we set budgets annually for things we want to spend on while meeting our other goals, then do so guilt-free. We both like to see the world and experience culture, so we set our travel and entertainment budgets higher than they need to be to encourage us to enjoy the fruits of our labor.

Comparison to Previous Years

Surprisingly, 2019 continues our year-over-year decline in total spending streak. Most of the decline is fueled by switching travel expenses to points/miles programs and leveraging rebate/promotional offers to reduce food expenses. Some may view this as we’re trading additional labor to cut costs. We believe it’s important to know that’s possible as an option, especially during times when belt-tightening is needed.

YearTotal Spending ($)
2020Read Our 2020 FIRE Budget

In terms of our 2019 budget set on January first, we simply wanted to meet or beat our 2018 spending ($42.958.89). We managed to cut nearly 5% out of our spending from 2018!

While the amount of money we spend works for us, that doesn’t mean our numbers are right for you. Reaching FIRE is a marathon, not a sprint. It needs to be sustainable. You can prevent comparison from being a thief of joy in your life by running your own race, but still learning from the tactics and strategies we employ.

Paying off the Mortgage

As you can see in the primary expenses table, the Subtotal line shows what our expenses would be if we paid off the mortgage on our house. At $31,197.85, it’d cut our annual expenses by nearly 24% ($9,846.44 reduction). However, moving approximately $162,300 out of investments to pay it off doesn’t make mathematical sense for us.

We expect our investments to earn, on average, nearly 10% ($16,230 on the mortgage balance amount) annually. Our investments are in index funds rather than individual stocks, which should offer consistent average performance.

We continue to be able to take advantage of tax deductions for the mortgage. While that’s a simplification of the math, it’s easy for us to decide to keep the mortgage.

This doesn’t account for the psychological effects of debt and may not be true for others. We wrote an article answering when you should pay off your mortgage or invest if you’d like a deeper analysis of this question.

It’d certainly make for a better headline to say we only spent $31,197.85 last year, though!

Safe Withdrawal Rate

In general, we need 25 times our annual expenses in investments in order for us to pay those expenses from the growth of those investments. That reflects a Safe Withdrawal Rate (SWR) of 4%. This range is calculated based on an average investment return (around 10%) across a large history of the modern investment market, subtracting inflation during the same period (around 3%). The remaining 7% is then adjusted for safety where sequence of returns can cause adverse effects to investments.

For example, if you happen to retire and start withdrawing from your investments in the middle of a recession, you’ll be drawing your budget out of depressed assets. The Trinity study is well known for calculating historical outcomes for a range of SWR over 15 to 30 year retirement periods. The study also tested different portfolio allocations.

There’s certainly nuance to the 4% rule-of-thumb and cases where it doesn’t work. For the purposes of budget planning and expense review, we’ll stick to the 4% rate based on a mixed 80/20 stock/bond portfolio. A 4% SWR should offer an approximate 98% success rate in 30 year periods.

SWR (%)Required Portfolio Value ($)
Based on our 2019 $40,885.00 in expenditures.

Our forward-looking budget will work with a little headroom (perhaps approaching 3.5% SWR) to help ensure a high success rate as our retirement period should exceed 30 years. By the time we reached FI in 2018 (read our story of how to become a millionaire in 10 years (or less!)), we exceeded our SWR goal. The Trinity study also worked under the assumption that once retirement occurs, the retirees would never have a source of income beyond their portfolio. That may match a more traditional retirement or a certain personality.

It’s likely we’ll continue to earn a bit of side income from hobbies turned to businesses, ongoing consulting where we take special interest, and other pursuits. However, this isn’t our focus: we’ve reached the point of knowing how much money is enough for us. A little extra income does help account for surprises, mistakes, and adds slack to our 2019 budget.

Looking Forward to 2020

We expect 2020 to have a transitional feel to its expenses. We are both making adjustments to our work schedules, with Jenni changing from full-time to part-time work, to a very limited as-needed work schedule. That transition will occur between May and June (update: it did!).

I continue to narrow my projects to those especially interesting and fulfilling as I’ve asked myself why do people work in the first place. Making those adjustments will mean a bumpy few months of transition and establishing new habits or routines.

Our plan to enter a form of early retirement has been building for years and it just so happened to enter a serious new stage during the pandemic. We’d started the wheels in motion months ago. We were ready with our FIRE number and date, actively choosing to make serious changes now.

We’ll have our 2020 budget review ready early in 2021 (update: available here!), sign-up for our newsletter to get notified about it. The budget review will incorporate conscious spending strategies, spending goals, and some fresh tactics on the road from financial independence to early retirement.

Let us know if you found some neat tips and tricks to achieving FIRE in our FIRE budget in the comments below!

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By Chris

Chris began his financial independence pursuit in 2007 as he learned basic personal finance from Get Rich Slowly as an aspiring web designer and novice investor. After several missteps, he learned the secrets of financial independence and began his pursuit of freedom.

He reached financial independence in 2018 with $1.2M and two businesses. He began the process of transitioning to early retirement in 2020.

Learn more: Meet Chris.

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