# Critique my budget, suggestions please



## summer (Jul 7, 2011)

We make decent money. We do save. No consumer debt.
I will not go into my income nor net worth. What I do know is that I could save more.

So, I will post SOME of my monthly expenses here so you can tell me what is way off track or where I can improve.
We spend on average between 10000-12000 a month. I could be saving so much more and am starting fresh in the new year.

First let me tell you, we are a family of 4. We have a large home (thus utilities are not cheap). We have a pool and hot tub. 2 cars.
No debt on cars. 

mortgage $1800
groceries $1100-includes alcohol, toiletries--we can lower this to 700
private school $1000
property tax $865
gas $600
Go train $177 
utilities 450
Bell- 200
cell phones 67
entertainment -60
general merchandise 400

insurance: life 66, auto 133, house 53

restaurants 300 --will lower to 100
cash-300
clothes 300
sports for family 300
vacations 600- we love to travel
personal care including hair etc 170

thats about 8600 above but then there are other items too.
Can you tell me you thoughts on the above items?

then there are car repairs, gifts, home repairs etc, new furniture as needed.


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## mcoursd2006 (May 22, 2012)

If you were willing to downsize your home and move to a location closer to your work you could reduce your utilities, transportation cost, and possibly property tax and/or mortgage. Maintenance of a pool and operating cost of a hot tub is quite expensive.

$200 for Bell, and this without the cell phone? Can you forego the landline and the cable package? 

And restaurant? That's a lot of eating out.

What's wrong with public school?

Heck you could probably cut your spending in half if you were willing to make some compromises. It's a good thing you didn't post this in the frugality forum. You would have been ripped to shreds with that budget. But heck, what's it matter? If you make decent money, are living within your means, make some savings at the time, and are happy, continue what you're doing. If you think you could achieve the same level of happiness with less, then you could think about cutting back.

We're a family of five and we spend less than a third of what you spend. The only category that comes close is the food/grocery.


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## steve41 (Apr 18, 2009)

My God! You could be Donald Trump or Larry Lunchbucket age 55 with $10K in the bank. How are we supposed to respond?


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## summer (Jul 7, 2011)

The Bell is for satellite, internet and home phone. Cell is separate.
Moving out of the area is not an option. Though down sizing could be an option.
Private school is benefiting our child so much. It's only for a few more years and definitely with the money to me.

Do you find the utilities too high?
Restaurants, we could cut down for sure. 
Groceries also.
Bell, we did downgrade the satellite package. Maybe we need to do more cutting.


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## mcoursd2006 (May 22, 2012)

Utilities is the least of your problems. What would you do? Dial down a couple degrees on the thermostat so you could save $10 a month on gas? Seriously?

But if you are serious, how about this:

1. Downsize your home. Either refinance the mortgage, or pay it off quickly. Don't buy another house with a pool or outdoor hot tub. Those are for people with more money than brains. Oh wait, sorry, you might be one of those.:biggrin:
2. Get rid of the V6/8 SUV, which I'm sure you have, and get a fuel efficient sedan
3. Lose the cable package and landline, and ditch Bell. Get broadband from another ISP (not Rogers either)
4. Stop eating out
5. Cut back on travel/vacation
6. Cut out 'General Merchandise', and what the heck is this anyway?
7. Auto _and_ car insurance?
8. $300 for clothes every month? Are you buying a new suit every month?
9. $170 for personal care? C'mon!

As I'm typing this I am shaking my head and thinking why do I even bother. But I guess I can't resist taking the bait.


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## summer (Jul 7, 2011)

The insurance, I edited, it is auto and house.
I sense rudeness from you, why the hostility?

General merchandise is dry cleaning, new curtains, school supplies, items from future shop, random household items.

We are quitting the eating out unless we have a wagjag or groupon.
Personal care: haircuts for two kids and hubby. 20 x 2 for kids and 25 for hubby. My hair is about 100 a month, plus 20 for eyebrow waxing.

The clothes are definitely getting cut right down.
Lose Bell and replace with what?


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## summer (Jul 7, 2011)

Do you think the mortgage is high?


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## nathan79 (Feb 21, 2011)

Hard to know where to start. You obviously wouldn't be happy with a lower middle class lifestyle, so it would be silly to suggest cutting too drastically.

Some things that do stick out... $600 for gas AND $170 for the train? I guess if you're driving 5 hours a day. 

Merchandise, restaurants, clothes, and vacations -- could probably cut all those in half.

It might help to start tracking and itemizing "cash" and "merchandise".


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## summer (Jul 7, 2011)

The GO train expenses will be lower now. DH will be driving more now. Long story.
A tank is 70, we go through at least a tank in each car each week. 70x8
I agree that we can cut on those items you mentioned.


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## mcoursd2006 (May 22, 2012)

summer said:


> The insurance, I edited, it is auto and house.
> I sense rudeness from you, why the hostility?
> Lose Bell and replace with what?


No. I am not trying to rude, but perhaps unintended condescension. It just seems obvious to me where and how you can cut. And my comment about the pool and hot tub, no disrespect intended if the house came with them. If you put them in after you bought the house, well then,..

It seems silly to be trying to save a few bucks on your internet when you can make a much bigger impact with, say, going to a single car. But here are the little things:

Replace Bell with Teksavvy, Comewave, or any of the other smaller ISP's that doing come with a ball an chain. A 300GB package starts as low as $30/month.

Start cutting your own kids' hair. A $40 pair of clippers from Costco pays for itself after one cut. It's not rocket science. It's actually pretty idiot proof if you use the combs.

Travel budget of over $7000/year is not unreasonable, but still a lot.

Again we're talking about small things here when there is a much bigger fish to fry, namely your big house. I am assuming you have a mortgage that's just under 400k. While that's not unreasonable, especially in areas like Toronto or Vancouver where 800k isn't going to get you more than a 1100sq.ft semi, it's still a lot of mortgage to carry. Do you have much equity in the home?

You have to take a look at what is important to you and your family. If doing all these things fills you with dread and unhappiness, then why go through the trouble? Like you said, you are making decent money. If you are serious about making wholesale changes, however, here's a good website: http://www.mrmoneymustache.com/

He goes to the extreme sometimes, but is entertaining, if nothing else.


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## summer (Jul 7, 2011)

You do realize that for many families, two cars are a must.
I don't even know a family with two parents and one car.
My DH has client meetings at times, he needs a car. I drive the kids to school then either do errands or work. In the evenings, at times the kids are in two different places needing pick ups. Heck, in the early eighties my parents had two cars.

The hair, my kids are teens, they do not want mommy cutting their hair.
We could certainly trim the vacation budget.
We have a lot of equity in the home.

Oh and we put the pool and hot tub in. While the utilities are higher, our family gets a lot of joy from it.
It's great exercise too. The kids have amazing memories.


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## DayTek (Sep 26, 2013)

Considering you have a generous income coming in and are saving with no consumer debt, it looks like you are doing well.

However, I don't know if your "saving" includes RRSPs/TFSAs or RESPs. I'll assume it does.

Things that I noticed could be changed:

-Mortgage: If it's possible to downsize while staying in your area, that would automatically lower other expenses as well...Property tax and Utilities for example.
-Groceries: Cutting this to $175/week is much more reasonable than $275/week you currently spend (With $300/month on top of that in restaurant eating too!).
-Clothing: This could be scaled back considerably. To what, I don't know? Depending on your children's ages, if they aren't growing like weeds currently, maybe set aside $100/month?

Those are the "big" things I notice. The categories you listed of Entertainment and Restaurants are included in my weekly cash spending on my budget. So if you really want to tighten up, get rid of those categories all together and just have a weekly cash allowance...It makes you plan out your spending a lot more (Example: "We can all go to the movies, but not eat out at that restaurant this week.") Once the cash is gone, that's it.

It sounds like your income is well over six-figures...My husband and I live off of at least 1/3 of that. So there's a lot that you choose to take on financially that we do not. Even if we did make that kind of money, we'd do a lot of things differently. But kudos to you for maintaining the lifestyle you do all without going into to debt! With some of the things you've already suggested plus other's recommendations, you'll start to see more savings this year! All the best to your financial endeavors in 2014!

P.S. - Make sure your husband is totally on board with some of the changes you plan to make. I'm our household's Chief Financial Officer, so hubby just goes with the flow, but if I, unbeknownst to him, started slashing expenses that resulted in some lifestyle changes, he'd probably be a bit ticked off, LOL!


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## Sherlock (Apr 18, 2010)

I don't understand why your monthly gas costs are so high if you use the go train to commute to work? I mean how do you use up $600 in gas each month if you don't even drive to work? My car takes $80 to fill up the gas tank from empty, and I commute to work with it daily, plus drive it places on teh weekend, and my gas costs are still nowhere near as high as yours.

Personally I've never been too concerned about how much I spend each month and what I spend it on, but rather how much I save. If you are saving enough to have a sufficient portfolio by the time you intend to retire, then who cares how much you spend.


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## summer (Jul 7, 2011)

Daytek, my DH is on board. 
Thanks for the suggestions.
We could downsize and stay in the area. That is something we may look at in the future.
You said you would do a lot of things differently, can you explain what?


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## mcoursd2006 (May 22, 2012)

I've suggested if you're living within, even below, your means, and you're happy, then there is no problem. However, what if something were to happen that greatly reduced your income, say job loss, disability, etc., what then.

Living below your means is great. Living well below your means is better. I means that you can build up a good financial cushion under you so that if something catastrophic were to happen you will still be fine. Just food for thought.


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## Synergy (Mar 18, 2013)

Start small, create a budget, pick a category, make measureable changes, add to your savings as your expenses come down, and repeat. Don't tackle everything at once.

Utlities - make sure you have a good programable thermostat - turn heat down at night, while away during the day, on weekends, etc. Close vents and doors to rooms not in use. Try setting the temperature during the day a few degrees lower than you're accustomed to, etc. Use cold water to wash your clothing, use your cloth dryer sparingly - hang your close to dry. Inside drying will add moisture to your house during the winter months, and dry clothing outside during the summer months. Turn off lights when not in use. Shut off / unplug computers, routers/modems, TV's, etc. when not in use - do a little research on phantom power. Small changes add up overtime...

Sports / Rec - Fitness tax credit for children could shave a few dollars off that part of the yearly budget ($500 / yr).

I would start with easy items like groceries, clothing, restaurants bills, utilites, etc. Once you've maxed out on the small items and still have an urge to scale back more, try tackling a few large items - types of cars you drive, size of house you live in, etc.

Most importantly, have fun with it , you'll eventually reach homeostasis!


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## steve41 (Apr 18, 2009)

This stuff is meaningless, unless we know the bigger picture (salaries, current savings, age....). For all we know these guys are living way too frugally..... their rotten kids will inherit a gazillion dollars when they die. Or they will end up sucking air at age 70.


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## Ihatetaxes (May 5, 2010)

steve41 said:


> This stuff is meaningless, unless we know the bigger picture (salaries, current savings, age....). For all we know these guys are living way too frugally..... their rotten kids will inherit a gazillion dollars when they die. Or they will end up sucking air at age 70.


+1


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## Ihatetaxes (May 5, 2010)

mcoursd2006 said:


> Don't buy another house with a pool or outdoor hot tub. Those are for people with more money than brains. Oh wait, sorry, you might be one of those.:biggrin:


I would never own a house without a pool. Annual operating costs including running the pump, gas heat, minimal chemicals (salt water system eliminates the need for much) are in the neighbourhood of $700. Add in $300 annual budget for replacing pool equipment (my heater is 8 years old but I did replace a pump for $500 last year) and we are spending about a grand a year. My family uses our pool 6-7 days a week from mid-May to end of September. Average swim time of an hour (week nights sometimes only 20-30 minutes but some weekend days in for 3-4 hours. I would guesstimate we are well under $10 an hour for healthy, fun family time. My kids are awesome swimmers and could swim laps unaided at age 3.

We have another home with a pool but it brought in over $50k gross income in 2013 and the pool expenses are a deductible operating expense.

So not sure I agree with your comment above. I like to think I have lots of both.


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## cjay (Nov 7, 2009)

I just finished looking at our 2013 actual v budget. Sounds like we have similar sized family and expenses so it was interesting for me to compare. My travel budget is a lot bigger, maybe housing costs and transportation seem a bit lower.

Here is my big picture summary for all monthly expenses

Budget (2013 Actuals):
Fixed Monthly Expenses $3,850 ($3820)
Variable Monthly Expenses $4,150 ($5,500) :frown:
Monthly Savings $5,350 ($4,000)

Hope this helps, all the best in 2014




summer said:


> We make decent money. We do save. No consumer debt.
> I will not go into my income nor net worth. What I do know is that I could save more.
> 
> So, I will post SOME of my monthly expenses here so you can tell me what is way off track or where I can improve.
> ...


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## Plugging Along (Jan 3, 2011)

One thing you haven't really provided is what problem are you trying to solve?

You have no debt- good

You save you want to save more - who doesn't. Are you concerned with something such as not enough for retirement, kids schools, something else. Is there a goal that you are worried that you won't meet?

It sounds like you are generally happy with your lifestyle, so any major changes in here will be a waste of typing unless there is a reason. Small tweets are always fine, but is that what you looking for? If not, suggestions of major changes (selling house,going to one car) mean nothing without context.

Based on your monthly expenses. You listed above, you still have between 1600-3600 not accounted for. Also, no. Mention of your savings rate which is very important in these types of posts.

Our spending is right up there with yours, except we have no mortage, and spend $3000 in child are a month, but we also put an amount we are comfortable with at this time for savings. 

You may want to provide more info I terms of your goals, or where you feel there are gaps. How much more do you want to save a month.


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## Taraz (Nov 24, 2013)

Assuming Toronto property tax rates your place should be worth just under $1.4 million. If those numbers aren't at least close, I'd consider moving somewhere with lower property taxes, because you're getting gouged. Especially if you don't consider the schools in your area suitable.


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## summer (Jul 7, 2011)

The unaccounted expenses are random items
Such as
Car repairs were 4000 for the yr
Cousins wedding 1000
New mattress 2500
New kitchen chairs 1500
Sons confirmation 2500

Just random expenses.


My goal is to increase savings.
I hear so many people that save a lot more than we do so at times I feel guilty.
I guess we chose this lifestyle.


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## Plugging Along (Jan 3, 2011)

My advice would to determine really what your goals are. Saving more with out any purpose is like saying losing weight. Rarely will it work. 

Guilt is merely a trigger for one to look at what they are doing. Looking at others really makes no sense. Keeping up with the jones in term is saving make no more sense than keeping up with the jones for spending. If you are merely saving money because others are, does that really make any sense?

One point I did notice in your post is the you said 'I GUESS we chose this lifestyle' 

You either chose is or some one held a gun to your head. You did chose the lifestyle, so if you are happy with it and your results then , continue on the way you are, if not, then you need to own the choices that you have made, and decide what changes you want.


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## summer (Jul 7, 2011)

I guess my point is that I can't compare the lifestyle I chose to those who haven't chosen the same lifestyle.
I do enjoy my life.

I want to work on paying off the mortgage in the next few years.


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