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Sunday, February 26, 2017

Frugal Vs Frugal

Posted by Tim Stobbs on September 4, 2008

Frugal Trader over at Million Dollar Journey just posted his annual expenses.  So I thought what the hell, let’s do a little comparison between us.   This is mostly for entertainment value and also to show frugal is a completely a personal decision.

Expenses (on an annual basis): FT numbers are first and mine are second.

Housing Expenses: FT $24,500, CD $22,050

  • Mortgage: FT $14,300, CD $13,300
  • Property tax: FT $3,000, CD $3400
  • Maintenance/Furnishings/Upgrades: FT $3,600, CD$3000
  • Utilities: FT $3,600, CD $2350

Car Expenses: FT $6,280, CD $2450

  • Car payment: FT $0, CD $0
  • Gasoline: FT $3,600, CD $1400 (also includes bus pass)
  • Maintenance: FT $2,400, CD $1000
  • Registration: FT $280, CD $50 (license only, registration is included in insurance)

Home Essentials: FT $2,010, CD $1430

  • TV/Internet/Landline phone: FT $1,440, CD $1300
  • Cell phones: FT $570, CD $130

Food and Booze:  FT $7,800, CD $3600

  • Groceries: FT $6,000, CD $3600
  • Entertaining/Eating Out: FT$1,800, CD $0 (Included in spending below)

Insurance: $FT 3,590, CD $2000

  • Home: FT $460. CD $800
  • Automobile (for 2): FT $1,750, CD $800 (one car)
  • Life: FT $420, CD $400
  • Disability insurance: FT $960, CD $390

Spending: FT $3,600, CD $7000

  • Personal spending/shopping: FT $3,600, CD $7000 ($3800 us, $2800 kids, $400 misc)

Other Expenses: FT $3,200, CD $1500

  • Charity: FT $2,000, CD $0 (This comes out of spending above)
  • Gifts: FT $1,200, CD $1500

Total Annual Expense: FT $50,980, CD $40,030

Wow that was entertaining to put together.  I noticed right off FT and I tend to break up our money a little differently hence some of the differences (like my spending is higher, but FT has a eat out catagory).   We both don’t have childcare costs (I won’t for a while until my wife decides to stop running the daycare out the house).  Also the daycare requires additional insurance so I get stuck with a bit more of an expensive home policy.

The obvious differences are my food spending is cheaper, I don’t have a second car, I only have one cell phone and my utility bills are cheaper.  Also I would guess on an overall basis FT give more to charity than me ( I don’t track a exact number but likely a couple of hundred dollars a year when FT is a couple of thousand).

What is most interesting to me the rest is very similar.  We both spend most of our income on housing so when you pull kid costs and mortgage costs out during our early retirements we should both be able to live off a fairly low income.  So there you go folks a plan for early retirement.  Keep your costs down.  Or you could do like Jacob over at Early Retirement Extreme and move into a trailer to save half his living costs.

Comments

13 Responses to “Frugal Vs Frugal”
  1. That was very entertaining! One thing I didn’t add to my expenses was the cost of raising the little one.

    I still can’t get over how little you spend on food! I need to take some lessons from you guys.

  2. Canadian Dream says:

    FT,

    Perhaps I need to run a series of posts on eating for pennies.

    I know also it’s partly what you like to eat and where you live (for example, milk here is so cheap that powdered milk is only cheaper by a couple of pennies).

    Tim

  3. CD, $3,600 annually on food!? Are you living on KD and dented cans? ;)

  4. Canadian Dream says:

    MGL,

    No, KD or dented cans, but everyone keeps asking questions like that and I keep trying to give answers, but it never seems to sink in.

    So I’ve talked to my wife and we are going to do a little bit more of an open examination of how we eat for the next month with some recipes. Hopefully that will help everyone else out.

    Tim

  5. Yeah, that food expense level is pretty good for a Canadian, right? I hear food is very expensive up there.

  6. Sarlock says:

    It’s very impressive. So far this year we have spent over $6,500 to the end of August for a family of 3. This combines food and household items (soap, toothpaste, etc). Our annual expenditure lands around $55-$60k per year.

    Do keep in mind that part of your mortgage payment is principle, if you haven’t backed that out. Only the interest is a “true” expense item.

  7. Four Pillars says:

    Awesome comparison – I’d love to do something similar except that we don’t track our expenses all that closely.

    I’d be interested in more frugal food posts for sure!

    Mike

  8. Canadian Dream says:

    ERX (Jacob),

    I wasn’t aware food was that much more expensive in general in Canada. Then again it has been a while since I’ve visited the US.

    Sarlock,

    Oh, yes that $300 does include soap, paper towel and other things like that.

    Technically yes, you are right I should only put the interest amount for an expense. In that case we would currently be at about $7050 for interest in a year. So my yearly grand total drops to just over $34,000.

    Mike,

    I’m already working out a draft for next week. This should prove to be interesting.

    Tim

  9. Dave says:

    I don’t see how paying less on your mortgage has anything to do with being frugal. I was actually surprised by how little Mortgage is costing you per year. What is your reasoning for this? I am currently going very aggressively at my mortgage so I’m doing $750 P&I per week. But I see myself as frugal on many other items, but definitely I could not match your frugalness!!!

  10. Canadian Dream says:

    Dave,

    The reason my payments are where they are at is I really don’t need to pay it off any faster. Other than a couple extra payments in the next 15 years it will be gone when I pull the plug at 45.

    So that leaves me time to start doing some selective stock purchases and start some DRIPs.

    Then if I can’t find anything I want to buy I can just pay off the mortgage faster.

    Tim

  11. tom venner says:

    My wife and I probably average about $100 a week on groceries ($4800/yr). We look trough flyers to find items we buy regularly on sale, but do not scrimp on produce in particular (don’t like the quality at no frills, price chopper etc).

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