In preparation for this year's taxes, I scoured through bank statements and the year's credit card reports looking at where and when we made donations as well as reviewing where we spent our money in 2020. It was a valuable analysis, one I recommend that everyone do.
What did this analysis show me?
College
Our biggest bill was our son's college bill. I believe that is money well spent since it is a terrific investment in his good living today and good opportunities for the future.
Home
Though mortgage payments were high overtime, our home has been a good investment. We would get back almost every penny we paid so far if we were to sell our house. If we were a bit more daring, we may have doubled that return, but given our income, we're not big risk takers when it comes to money.
Insurance
Overall I think we're paying too much for our multiple insurance policies including health, home, and car insurance. I have to revisit those policies and costs in the days ahead to reduce these costs.
Health
Our health expenses were quite high and as I reviewed those costs, it was clear that a good investment in healthy living will save you health dollars later on in life. Paying attention to time in the sun, the foods you eat, exercise, and regular doctors' appointments will save you health dollars and help you to live a long, healthy life too.
Food
Food is a regular expense, and dollars were wasted when we bought crummy food at the last minute. Though sometimes more expensive, the best dollars spent on food were dollars spent at local farm stands, orchards, and to grow food at our own home. Weekly care with grocery shopping and eating out or taking out at places where the food is exceptional also equal money well spent. As they say, if you carefully shop the perimeter of the grocery store, you're more likely to find the healthiest foods. Resisting overly processed, fast and packaged foods will keep you healthier and save you money too. Investing a few, quality kitchen tools and equipment will help you to make enjoyable meals at home as well. And, reading about recipes and food tips online regularly increases the quality of food you prepare and eat.
Recreation
A review of recreation costs demonstrated to me what I really enjoy when it comes to spending my money on good times. If we're traveling overnight, I like a quality, clean, and well-located accommodation. I like fancy places, but I can give up on a lot of the extras to save money. I mainly enjoy novelty and adventure so money spent on a summer boat ride, thought a bit expensive, was a great investment because we had such a great time. Accommodations on a lake front and a ferry ride to a beautiful island to bike were also good investments in wonderful times. Some pandemic travel costs were not worth it as the pandemic limitations truly limited what you could do away from home. Eating at crummy places while traveling also added up to dollars wasted. A good investment during the pandemic was visiting countless public natural spaces that afforded wonderful hiking, biking, swimming, and other adventures. You can have a lot of good times for little money if you're creative.
Contributions
A review of our contributions found me satisfied. Of course, I'd always like to give more and hope to in the future, but with the dollars we had to give, I was satisfied with the organizations we chose. Once our college payments are done, I hope to revisit this area of expenditure.
Media
Like insurance, we spend too much money on media--we have too many subscriptions and too many overlapping memberships to various communications groups and channels. I have to research this as it's easy to be cheated in this area. Someday soon I'll do a complete review.
Clothing and shoes
I think that most people saved money on clothing during the pandemic which means that there are a lot of good sales out there right now. Taking a look through your drawers and closet will help you to know what kinds of clothes you need and enjoy, and the clothing and shoes you've wasted money on overtime. There's money to save in this area.
Repairs, upkeep, and regular home/car costs
This is an area of life that demands review. In general, buying used cars in good condition is a great investment as long as you keep up with car care. Over time this has saved us a lot of money. Additionally doing the research about regular home updates can help you to save money too. For example, we replaced our heating system with a 0% energy loan, and that's saved us a lot of money and afforded us reliable heat--it was a good investment. Just like your health, if you keep up on car and home repair, you will save a lot of money and angst in the long run. Keep a running list, and attack problems step-by-step.
Further, we've had to hire a number of specialists to do repairs in areas where we don't have the knowledge or skill. We've spent time with those repair persons and learned a lot about how to keep up our house. This has been a good education and given us the skills to perform some of these skills in the future ourselves. So sometimes it's worth hiring the expert to do the job and learning from them.
Do it yourself
There's a lot of tasks that people hire others for that they can do themselves. Assessing the money you spend on outside experts and then determining what jobs you can do yourself can save lots of money.
Making more money
It's often worth spending your time learning how you can make more money rather to assess every penny spent. Can you make more money? Is it worth the time it will take? Should you invest in more education to reach the top of your pay scale or learn new skills that will lead to better jobs? Investing in your professional skills and ability to make more money is advantageous and can spell a better lifestyle down the road.
Summary
A good review of where and how you spend your money says a lot about who you are and what's a priority for you. For example, my husband and I have chosen to spend a good deal of money on our children's educations--that means a lot to us, and we're willing to sacrifice to do that. On the other hand, we don't spend a lot of money hiring people for household chores or having a fancy home--we'd rather save any extra money we can to take a trip now or then or host a family celebration as that brings us joy. Everyone makes different choices about how they spend their money, but everyone can profit from a yearly review of dollars spent as it's a good way to help yourself live a life that makes you happy. Onward.