2017 was really smooth in terms of our shared finances. We’ve come up with a system that works perfectly for us, in that I can be as detailed with my money management as possible, while RD can learn as much (or as little) as he wants to learn, while knowing that all the bills are being paid (and we’re even saving a little bit in our joint accounts too!).
Related: How I saved 50% of my income in 2016
Last year was the first time I’ve done a spending recap before, but since the numbers continue to be easy to extract, I’m going to keep on with the trend – and now I’ll get to compare 2017 data with 2016, which makes me extra excited. :)
What I spent in 2017
Note that the lines in orange are expenses that we share 50/50 – and the numbers you see below are my portion of the expenses.
I had seriously grand ideas of spending less than $30,000 in 2017, but then life got in the way. Just looking at the chart, I can see exactly what I bought that put me over budget, as well as well above what I spent in 2016. It’s not horrible, but it’s really not that great either.
Related: Here’s how I spent $34,700 in 2016
Now, just for fun, let’s compare what I spent in 2017 with what I spent in 2016:
(Rent/Mortgage, Utilities, Strata Fees, MSP, Insurance, Cell Phone, Internet)
Everything looks about normal. I’m super proud of lowering my Shaw internet bill though, saving me $105 from last year. Not that it mattered in the overall scheme of things, haha. It was just a one year price, so I’ll have to call again in the next few weeks to see what else they can do to keep me. There’s so much competition now that even if they can’t give me the promotional rate again, we can just go to another company with pretty much zero issue.
(Food, Household, Entertainment, Clothing, Travel, Car/Transportation, Personal Care, Fitness, Gifts)
Ok it’s not that bad. I mean, if you take out the $4,500-ish that we spent on closing costs and moving into our condo, my total spending was almost exactly the same as in 2016. Moving is not cheap, and those expenses include hiring movers, buying new furniture, painting, and pro-rated property tax for the year. So, actually that makes it a lot better.
The cat was more expensive than I thought it would be (her costs are in the Household section of our budget). After our initial start-up costs (which weren’t that cheap), I’d say we spend about $100/month on her food, litter, treats, and toys.
I’m embarrassed at how much I spent on Entertainment and Clothing though. I bought a winter coat, so that took up at least 40% of my clothing budget, but Entertainment? That’s a lot of money spent keeping me entertained during the year. I guess 2 or 3 film festivals, a couple concerts, and a few dinners out each month would do it. I seriously want to cut this down in 2018.
Other than that, my spending looks *fairly* normal. My cell phone was over budget a little bit because I bought a roaming package when in Portugal.
What I saved in 2017
Overall, I saved 45.4% of my income in 2017, and increased my net worth by $47,645. I think I would have been able to save more throughout the year (because my savings rate is 4.6% less than 2016), but we are putting down more towards our mortgage than necessary. This helped me increase my net worth, but didn’t do anything for my bank account. :)
Speaking of the mortgage, you may recall that our purchase price was $468,000. We had a down payment of $115,000 which meant our mortgage was $353,000. After the first 6 months of payments, our current mortgage balance sits at $345,700. I’d like to be more aggressive with our mortgage in 2018, however I think our wedding might get in the way of that. More to come about how the wedding will affect our budget and spending in the next 8 months.
And that’s it! Any questions?
Was 2017 what you had expected financially?
Most of you know that I live in Vancouver, and housing in Vancouver is bananas. Like, it’s legitimately insane. The average price for a detached house sold in Greater Vancouver was $1,830,956 in May (!!!), and the average price for a condo? $656,919 – up 15.1% from 2015.
When RD and I bought our condo a few months ago, we managed to combine our savings for a 6-figure down payment. $125,000 to be exact. Neither of us got help from our parents. We didn’t receive any sort of inheritance, and while we both have good full-time jobs, we still live in the middle-class.
So how did we do it? For me personally as a natural spender, it was a lot of hard work balancing needs vs. wants, but also making savings a priority for the better part of the last decade. The bulk of our savings was done individually before we met each other, so when we did eventually move in together and our housing expenses decreased, we just kept the savings train moving along.
Here are a few main reasons why we were able to save up a 6-figure down payment:
Eliminated all debt
Long-time readers of GMBMFB will know that this blog was born because I was on a quest to get out of debt. My main goal after graduating college was to get out of debt as fast as possible. I knew that debt would hold me back from every major goal I wanted for myself – to move out of my hometown, to take chances when it came to my career, to travel, and to buy a home – and I didn’t want to regret missing out on opportunities because I couldn’t afford to take risks.
RD has always been good with his money – even when he didn’t have much. His parents were (and always have been) good role models when it came to frugality, and he left University with zero debt because he worked hard tree planting every summer. 10 years later, he’s extremely debt-adverse and while he definitely has things that he splurges on, he is way, way more frugal than me.
Avoided lifestyle inflation
I’ve worked hard at trying to curb lifestyle inflation, but of course my budget has increased in the past 10 years. So the way I keep my overall costs down is by prioritizing my purchases and stopping myself from spending money on stuff that doesn’t bring value to my life. For example, I don’t really put value on make-up or beauty products, and I also don’t care for nice cars, jewelry, alcohol, or going to fancy restaurants – so I spend very little money on those things. Instead, I focus my spending on what I love to do. I’d rather put my money towards traveling, the occasional splurge on concerts or event tickets, and buying quality ingredients when I cook.
But I have a serious weakness for Anthropologie and anything at MEC, and sometimes I get lazy with cooking, so it’s all a work in progress. :)
Banked all extra money and windfalls
I’ve never had a big salary from my full-time job, but I’ve always had multiple streams of income. At the beginning, it was to get myself out of debt as fast as possible, but then it was to save money for a future down payment, as well as for my retirement. I’ve done a lot of crappy jobs over the years to earn money, but it helped me set up a good financial foundation for myself. Almost all of my freelance income goes towards some form of savings, and whenever I get a raise, I make sure to increase my savings rate accordingly.
There was that time I worked two full-time jobs at the same time … I also took on freelance graphic design contracts, started freelance writing, sold stuff on eBay, worked minimum wage part-time jobs for YEARS, and of course started this blog (not with the intention of making money, but has ended up being a decent source of income). I may not have always enjoyed hustling so much in the short-term, but it helped me achieve some pretty big goals in the long-term, and it got me to a better place in life. So it was worth it for me, and I look back on those years with gratitude that I had enough foresight to work as hard as I did.
A “Savings First” lifestyle
I used to save my money at the end of every month, if I had anything leftover after paying my bills. But the problem was, I almost never had anything leftover. So I decided to switch up my strategy and build my budget backwards – with savings as a line-item that was just as important as my rent. If I found I wasn’t able to put away that amount into savings and balance the rest of my budget for the month, I looked at ways I could cut expenses or earn more money. This strategy meant I was almost always hitting my savings goals – whether it was for retirement or shorter-term purchases.
Understanding that saving for a down payment is a long-term effort
Buying a home is a long-term decision, so saving up for one should be as well.
I get it, saving for a down payment can seem really intimidating. Especially when you’re faced with crazy real estate prices. But if you keep your home expectations reasonable, and realize that saving up that kind of money is a long-term process, it can be done. It took me 5 years to get out of debt and save for the down payment on my first place. But it’s not just about being able to save the down payment – it’s also having a strong emergency fund should anything happen in the future, and also being responsible enough to understand that buying a home is a huge responsibility and not one that should be taken lightly. I don’t think I would have been mature enough to take on home ownership when I graduated college at 23 – or even a few years afterwards. And honestly looking back, I’m glad I spent the rest of my twenties renting and saving money. Because even at age 28 when I bought my first place, I still wasn’t fully settled.
It was never my intention to use my savings for a down payment this year (I thought I’d be renting for the next 10 years+ of my life). But when the opportunity presented itself, and RD and I were in the right place in life and in our relationship, I felt extremely grateful and lucky that we were able to go through the home buying process without any real financial strain. And that was because of the “savings first” lifestyle we have both been living for the past 10 years.
Are you currently saving for a down payment?
Usually when you think about moving outside of the city, you think about being more reliant on your car. But one of the best things that has come out of our new neighbourhood is the ability to move down to a one-car household.
Since I switched to our downtown office back in January, I haven’t actually been driving my car. 95% of the time, my car has just sat there unused. And since RD’s work has a very good carpool program, most of the time he wasn’t driving his car either. The only time we actually use our cars is when we’re together on the weekends.
Being within a 5-10 minute walk of a SkyTrain station was a requirement when we started looking for condos, and luckily we now live approximately 10 seconds away from one. So in the next couple of weeks, we’ll be selling RD’s car and putting that money into our joint account (which likely end up as an additional payment towards the mortgage – but that’s another post for another time).
Our transportation expenses will end up going way down because now we’ll be sharing the cost of insurance and maintenance on just one car. We’re still figuring out how we will share gas expenses, as RD will be doing most of the driving with his commute to work.
But of course there’s a downside to not having two cars, and it’s that we don’t have two cars. If it’s RD’s turn to drive the carpool or if he’s working a longer day than normal, that means I don’t have access to a vehicle if I need to go somewhere that isn’t practical by public transportation (for example my doctor is in Port Coquitlam!). So I’ve been contemplating joining a car share program for a while now.
In New Westminster, I had three options to choose from – Modo, ZipCar, or Evo.
- $10 one-time registration fee
- $8 monthly fee
- $8 per hour (max $64 per 24 hours, $24 max between 7pm-9am)
- $25 one-time registration fee
- $70 annual fee
- $7.75 to $9 per hour ($73-89 per day)
- $35 one-time registration fee (waived for BCAA members)
- $2 annual fee (donated to charity)
- $0.41 per minute, $14.99 per hour ($89.99 per day)
I ended up going with Evo because even though the hourly rates were better with Modo and ZipCar I don’t think I’ll need to use a car enough to justify Modo’s monthly fee or ZipCar’s annual fee. Plus, I was at an event last night where I got the $35 one-time registration fee waived and 45 minutes of free driving time. :)
A huge bonus of being part of a car sharing program is the ability to drive to the airport without spending a million years taking transit downtown and then back out to the airport, or spending the money for a taxi. And conveniently, there’s an Evo parking lot just outside of our building. I’m really looking forward to seeing how car sharing fits into my lifestyle, and how often I actually end up using it.
Does anyone else use a car sharing program? Any experience using Evo?