Household Budget My Spreadsheet Reveals That I

Household Budget

My spreadsheet reveals that I am not spending too much per year. It shows that my spending is roughly aligned with my income. My savings rate is just over 4%, which is a low rate, but still higher than that of the average American. That I am able to save anything is a good thing, given that I am earning relatively low income in this scenario. By cutting some expenses, such as on rent, I am able to get by.

My single biggest expense, not surprisingly, is my rent. Thankfully, my rent is inclusive of utilities other than communications, which are billed separately. In every month, my rent was my most significant expense. There were some months where other expenses were also fairly high, such as December when I went home for Christmas, but the rent is always the highest.

There is a fairly high degree of variability in some of my discretionary spending. There are a few different categories of spending that are usually discretionary. Eating out and alcohol are always discretionary, and therefore there are months when my cash needs to be used for other things, and these categories are relatively low. Incidentals are another area where my expenses can be flexible. Not all incidentals are discretionary, however, for example if something breaks and needs to be replaced. Clothing and toiletries is another category of discretionary spending. This is a little more predictable, with upward fluctuations in clothing expense in particular when seasons change. Many other expenses are relatively steady. The car insurance and car payments are stable, as is the rent. I have ensured that I have an unlimited use plan for my communications so that there is stability in that bill as well. I also keep my credit card payments to a stable level, to ensure easier budgeting. I don't use the cards much anymore, so that this level of payment can easily be maintained.

I appreciate the fact that the budget gives me insight into what spending categories can be reduced. For example, the discretionary categories add up to anywhere from 10-20% of my total in any given month. This creates a lot of flexibility in terms of improving my savings. I can cut out a fair amount of alcohol and eating out in particular. Gas can be flexible, as can groceries, but I need both of those things. I cannot get to work without my car and I cannot eat without groceries. I also would not cut much from the clothing/toiletries budget, since one must buy new clothes every now and again, if only to replace old ones gone ragged.