With June already a full month behind us, it’s the perfect time for a mid-year review of the Modest Millionaires family progress in terms of spending and investments for 2019.
Overview of our objectives for 2019 spending
For 2019, in our 2018 spending & investment review we set a target level of annual spending of $48,000. An additional expense of about $8,000 related to the major renovation project from last year will also need to be added on top of this.
We planned on focusing our efforts this year on:
- Food, by continuing to track our grocery expenses based on our mission to reduce our grocery spending with a goal is to spend $150 per week in groceries and less than $215 per week for lunches/ fast-food/ restaurant.
- Alcohol expenses, by continuing to ban alcohol during weekdays (except really special occasions).
- Holiday/Special events expenses, by watching my spending when celebrating holidays or special events with our kids (Christmas, Easter, their birthdays, etc.) as I deal with some money anxiety linked to this which can trigger extra-spending.
Overview of our spending for the first half of 2019
To simplify comparing with 2018 and our spending target, I chose to project out what this level of spending would look like if we maintain the same average over the next 6 months. I’ve included both a projection on a yearly and monthly basis.
| Category | Yearly 2018 | Projected Yearly 2019 | Projected Monthly 2019 | |
| Recurring fixed expenses | $11,228 | $11,258 | $938 | |
| Electricity | $2,294 | $2,333 | $194 | |
| Home insurance | $1,221 | $1,477 | $123 | |
| Car insurance | $636 | $724 | $60 | |
| Phone/Internet/Netflix | $1,656 | $2,164 | $180 | |
| Municipal and school taxes | $2,803 | $2,762 | $230 | |
| Public Transport | $1,921 | $1,095 | $91 | |
| Car registration/licences | $698 | $702 | $59 | |
| Health | $2,407 | $2,386 | $199 | |
| Pharmacy | $1,430 | $1,303 | $109 | |
| Health/Fitness | $977 | $1,083 | $90 | |
| Food | $20,772 | $18,999 | $1,583 | |
| Grocery | $11,810 | $10,244 | $854 | |
| Restaurant/Fastfood | $2,596 | $2,528 | $211 | |
| Lunches | $1,018 | $1,037 | $86 | |
| Wine/Beer | $5,348 | $5,189 | $432 | |
| Entertainment | $3,159 | $4,759 | $397 | |
| Cinema | $75 | $145 | $12 | |
| Shopping (clothing/Books) | $1,199 | $2,596 | $216 | |
| Travel | $95 | $369 | $31 | |
| Sport | $1,402 | $1,446 | $120 | |
| Other entertainment | $388 | $203 | $17 | |
| Kids | $6,033 | $5,742 | $478 | |
| Baby supplies | $14 | $0 | $0 | |
| Kids activities/Toys/Clothing | $1,756 | $1,452 | $121 | |
| Daycare | $4,263 | $4,290 | $358 | |
| Variable expenses | $11,520 | $7,457 | $621 | |
| Gifts/Donations | $2,230 | $2,046 | $170 | |
| Gas | $496 | $1,067 | $89 | |
| Home Improvement | $1,159 | $199 | $17 | |
| Home supplies/services | $5,861 | $1,732 | $144 | |
| Car repair/Parking | $571 | $1,215 | $101 | |
| Financial costs | $182 | $0 | $0 | |
| Pet food | $722 | $412 | $34 | |
| Pet health | $134 | $690 | $57 | |
| Other | $165 | $96 | $8 | |
| TOTAL | $55,119 | $50,601 | $4,217 |
How are we doing with our 2019 spending objectives?
Overall our current projections for 2019 show that we’d be just $2,601 over our $48,000 target for this year. That really isn’t so bad, especially considering that we have another 5 months to continue making efforts to lower our spending.
Food wise, we’re on target to spend $1,614 less in 2019 on grocery & eating out compared to 2018. We’ve been continuing to track our grocery expenses based on our mission to reduce our grocery spending which is helping and I’ve been sticking consistently with planning weekly menus, most of the time.
However, we might fall short of our target to spend $150 per week in groceries as we are currently at a $180 average for our weekly grocery spending. On the bright side, summer and fall are the best seasons for some yummy and lower priced local produce, so I’m hoping this will help continue lowering our average to bring it closer to our target. As for our target of less than $215 per month for lunches/ fast-food/ restaurant, we’ve been spending a bit more with a projected $297 per month therefore we must keep up efforts in this area as well.
Our wine and beer expenses have dropped a tiny bit compared to 2018 but I’m pretty confident we can improve this further over the next 6 months.
As for our holidays & special events spending, although it’s a little hard to clearly see the differences as those expenses are split up between the gifts/donations, shopping, kids activities/toys and food categories, I believe we have improved somewhat in approaching those events.
While we still have one kid’s birthday to go in the Fall, as well as the mother of holiday in our family which is Christmas, we plan to keep up the efforts of not spending too much on things that don’t bring extra value during those days. Mr. Mod is also helping more with the food planning for those events as this is one category where I end up buying too much while he has better skills at knowing how much our loved ones will eat. Yay for teamwork!
All of this being said, we may still end the year with spending a bit over our $48,000 target for this year, especially considering that I just bought my plane ticket to FinCon (yay!) so this will add on a good amount in our travel category. We shall see what the next 6 months brings, but I’m still really happy with the improvements over 2018 spending!
Other notable changes:
I was hoping to see a reduction in our recurring fixed expenses as I no longer need a bus pass for commuting thanks to my new teleworking arrangement, but this $826 of saving was quickly eaten up by an increase in our insurance as well as in or telecommunications services. We did decide to upgrade our internet to fiber so that was somewhat related to my new working arrangement but the insurance increase and other fees in the telecommunications category were unrelated to it.
A reduction in our variable expenses was expected as we had a lot of home supplies purchases last year, however we had not expected some health issues with our almost 9 year old dog. That’s one of the hard parts to predict when being a pet owner, and I think I will be raising our projections over the next few years to prepare accordingly as she gets older and may face more health problems.
Finally, a big increase in the shopping category was largely due to me finally buying some new clothes after doing a big clean up of my closet. The fun part of this shopping spree is that it’s all comfortable clothes, since I don’t really need any uncomfortable office clothing thanks to remote work.
I chose good quality clothing that should last me quite a while and only a few strategic pieces I truly needed as I now keep a detailed inventory of all my clothing items. My plan is to only renew the pieces once they are damaged in the future, while maintaining this amount of items as too many clothes is simply overwhelming and unnecessary.
Value of Investments in July 2019 :
According to our 2025 plan, in July 2019 we should have a total investment of 52% of our FI# (does not include the value of our home), however, that amount accounted for our plan to only pay off our mortgage in 2021 or later but, in February 2017, we decided to take out a portion of our investment to pay off our entire mortgage.
Here is a brief history of the value or our investment and where we stand in comparison to our 2025 plan:
| Month/Year | Objective 2025 Plan | Total Value Invested | Note |
| January 2015 | 19% | 21% | |
| January 2016 | 24% | 23% | |
| January 2017 | 36% | 34% | We decide to pay off our mortgage at that moment by withdrawing about $100 000 from our TFSAs |
| July 2017 | 39% | 28% | With a house fully paid as well 🙂 |
| January 2018 | 42% | 36% | |
| January 2019 | 49% | 39% | |
| July 2019 | 52% | 51% |
After a decline in the markets at the end of 2018 which resulted in our lower January 2019, they have been performing pretty amazingly for us this year with our total investments reaching 51% of our FI# in early July. This is pretty significant as we are close to catching up to the level at which our investments would be, according to our projections, if we had only waited to pay off our mortgage in 2021 instead of doing so in 2017!
Looking forward to seeing how the rest of 2019 shapes up for our spending and investments!
How’s your spending looking now that 6 months have already passed by for 2019?
