I blinked and July disappeared. At least, that’s what it felt like. The news cycle blares bad news and rising COVID-19 cases every day, and I sometimes feel like a straight-faced duck– calm and serene above the water but paddling like crazy underneath. As you know by now, we moved cross-country and spent a good hunk of money doing it, so I was hoping to see costs settle in July.
Unfortunately, this month’s expenses (spoiler alert!) are the highest I’ve had in a while. In fact, the total is the same as the cost of moving in June, and higher than any expense report in 2019. When I got to my final total, I’m pretty sure I had a similar reaction to Tituss Burgess on the late show with James Corden:
Is this going to be the new normal? If so, I might have to crunch more numbers to see if I’m still on track to reach $1.2M by the age of 32, or if my article about being able to retire next year at the age of 28 is just a lie.
Let’s get to the expense report and see where this crazy high spending came from.
July 2020 Expenses
Note: This is the spending for just me. I report expenses when I pay them, so you may not see insurance or other bills until the month that I pay them.
|Rent||$1,320||As expected, rent nearly tripled after moving to a high cost of living area. Goodbye $500 rent, I will miss you dearly! This is the most I’ve ever spent on rent. Luckily, we love our little house.|
|Furniture and household goods||$290||Yes, we thrifted a lot, but that doesn’t mean it was all free. This is the total for everything we bought off of Facebook Marketplace, Goodwill, and Craigslist this month, including our 55” Smart TV, dining room set, porch furniture, coffee table, carpets, kitchen utensils, plants, and other household goods.|
Edit: Originally, I forgot to halve this expense, and thought I spent $580. This is much more agreeable!
|Groceries||$230||We are getting back in the swing of things now that our kitchen is fully restocked. Hopefully we can trim this back down to $108 per month, but we might have to be a bit more intentional if we want to do that.|
|Donation||$100||The American Civil Liberties Union (ACLU) “Black people are being murdered and brutalized by police with near impunity. Act with us to end police brutality, demand racial justice, and defend our right to protest. Your donation will fuel our legal battles and urgent advocacy efforts.”|
|Gifts||$40||Two July birthdays!|
|New bedspread||$40||The cat needed a bigger bed.|
Just kidding, but we did need a new bedspread.
|Home improvement||$26||Stuff we bought at the hardware store like plug adapters, tools, and plant-care.|
|Internet||$20||Our new internet is $40 per month or $20 each.|
|Fuel||$21||Fuel is much more expensive in California and we have been driving much more to buy things around town. I hope our driving goes down (especially when I finally buy a new bike) but we will see if this becomes the new normal.|
|EZ-Pass Toll Road||$13||Oops, I forgot to return my EZ-Pass, which North Easterners will know is the highway toll pass that sticks to your dashboard and lets you fly through toll stops. Apparently we need to mail it back. Hopefully I can haggle us a refund when we cancel our account.|
|Restaurants||$30||We went to In-and-Out, ordered take-away Thai food, and ate at the famous McConnell’s Fine Ice Cream shoppe.|
|Laundry||$5||After multiple years with in-unit washer and dryer, we are sad to go back to coin operated machines, but there are worse things.|
|Last July was my lowest expense month, totaling an unbelievable $255. Funnily enough, this July is my most expensive month so far! I want to dig a bit deeper below.|
How Much Of The Difference In Spending Is Due To Rent?
I wonder if rent is the big change here, I thought at first. In Portland my rent was $930 a month, while in the Albany-area it was just $500. That means I’m spending $390 more than in PDX and $820 more than in New York!
So how much did I spend if we ignore rent? Without my rent factored into July’s expenses, my total would have been $810. In 2019, my expenses not including rent averaged $348 per month. That’s a difference in spending of $462. That’s a big difference in discretionary spending!
That calculation shows that it’s not just rent that’s causing the spike. Of course, we do have one large line item as we furnished our house, but I struggle to dismiss it all as a one-off, as I find that every month ends up with a “one-off.” In the end, there’s always something that sneaks into my monthly reports that I don’t expect to stick around for long. So while I hope expenses will go down now that we have finished furnishing our house, I still need to keep an eye on lifestyle inflation.
What If This Becomes A Pattern?
“So what?” you might be thinking. In 2018, the average monthly spending of one ‘consumer unit’ in America was $5,102. If you count the Mechanic household as one consumer unit, we still hit just below average.
However, to become financially independent, you have to do better than average. With my previous spending levels, I could be FI next year. If I continue to spend over $2,000 a month, my new FI number balloons from $500,000 to $720,000!
California Dreamin’ or California Screamin’?
Luckily, my original savings plan still covers these spending levels comfortably. But this is a good reminder of why tracking your spending is important. It would be very easy for California Dreamin’ to become California Screamin’ if I weren’t watching my wallet. In fact, if this level becomes the new normal, I could start looking into ways to bring in a bit more income to cover the difference.
Now that I live in a bustling city again, I have reinstalled dog walking/sitting apps like Rover and Wag!. If I can get out and get some exercise while earning a bit of ‘fun money,’ why not? All in all, I feel lucky to live in such a beautiful place with blue-bird skies and shining sun and a gentle breeze. Is it worth the extra cost? We’ll find out this year!
What about you?
How were your July expenses?
Have you moved from a low cost of living area to a high cost of living area (or vice versa?)
What are your thoughts on this all-time high expense report?
Share in the comments below!