Reducing the discretionary spend – December 2020 results

As it turned out, December was my second-highest month this financial year for discretionary spending. To a certain extent it’s to be expected – the festive seasons brings various social engagements, both work-related and personal, so naturally this month’s figures are higher. However, social engagements were definitely more limited this year due to the pandemic.

I also realise, looking at my projections, that I didn’t actually allow for added costs on this line – d’oh! That was stupid! Fortunately, though, December also brings with it my annual leave loading (Qld government employees are paid their annual loading in the first pay in December), so that helped to offset things.

I also had a few unplanned purchases – I think I’ve mentioned before that our family only does Christmas gifts for the children but this year I opted to buy a few small things for the adults, and I usually flick my niece some cash as well. While I’d budgeted for my niece and the kids, I hadn’t done so for the other adults, so that blew that line out a bit. I also had to replace a broken household item, although this one was a low cost one. January will not be so good though – my bathroom extractor fan shorted out and, when I got up on a ladder to make sure that the flames(!) I saw when it happened had definitely died, the fan and motor unit fell out of the ceiling and broke the wiring, so there will be an electrician’s bill coming soon. I do have a couple of small, non-urgent electrical jobs that I want done as well, so it will be convenient to just have them all done together.

Food and groceries generally was quite a bit over budget (this includes discretionary food items from the supermarket as well as any eating out and takeaway). I know I tend to splash out at Christmas time, but this was worse than I expected. And I only got takeaway a couple of times! I’m starting to think that my budgeted figure just isn’t realistic.

I have changed my budget this year to include all my finances, not just to be a tracker of expenditure, so this year’s spreadsheet includes the money that goes to superannuation, as well as tax paid both within super and directly from my pay. I was curious to see whether factoring in everything made a difference to my savings rate. I’m charting separately my actual outgoings alone and outgoings plus savings. The percentages are based on outgoings only, not on a percentage of income, so they’re probably not quite correct – I haven’t figured out how to do this with charting yet. While I do love a spreadsheet, I am not really all that au fait with charts. I need to spend a bit of time on the Microsoft support site to figure out what I need to do to get this accurate. (I’m actually hoping to develop some skills with Power BI – we have it available at work as part of the corporate Microsoft Office subscription, so if I get the time to learn how to use it, that could make a bit of difference with my charts.)

In looking at the two charts, it’s interesting to see that tax (dark blue) represents the highest figure in my ‘expenses only’ outgoings at 38.37%. If I wasn’t a lefty progressive I’d probably find that very offensive, but I have strong beliefs around taxation and the common good, so I’m not as peeved as I could be by it. When my savings (including superannuation) get factored in as outgoings, though, tax comes down to a much more reasonable-looking 21.15%. It’s also nice to see that my super and my scheduled savings represent over 44% of overall outgoings (not that this money is “going” anywhere, as such, but it’s not available for spending).

Household and Utilities would’ve been lower if I hadn’t splashed out on a Thermomix (and various accessories 🙂 ), but I have no regrets about buying it. It’s proving to be very useful and I’m enjoying making recipes that I would never have bothered trying otherwise. Car expenses are much lower than they would normally be, thanks to the pandemic and the subsequent working from home.

As the other categories are all very small percentages, I won’t go into these here.

Coming up next – the half yearly Net Worth Update!