Jacob at Early Retirement Extreme is having a 30 Day Early Retirement Extreme Makeover. One of the goals of this makeover is cut your expense level to $10,000 or less a year. I thought I was close to this goal already since I try to keep my monthly expenses at $1000 a month or less and I knew I was below that level a few months this year. After reviewing my expenses for the year I realize I’m farther away from the $10,000 goal than I thought. Although I did have some months below the $1000 level I had more months above the $1000 level. I’m estimating that my total expenses will be about $15,000 for this year and my total income at about $12,000. This is not as good as I thought but that is part of the reason why I track my income and expenses; so I can review them and tell how I’m doing.
Looking at my expenses my budget busters are transportation and entertainment. The transportation category is somewhat misleading because I drove my car delivering pizza most of the year. Some of that expense should really be a deduction from income. Still there is plenty of room for improvement in the transportation category and I will be making some major changes there. Some of the increase in my entertainment expenditure is from having a GF but most of it was just the result of stupid decisions on my part. This expenditure can easily be reduced just by choosing more free or low-cost options for entertainment.
Since the new year is almost here I’ll go ahead and set a couple goals now. The first is to have my expenses under $10,000 next year. The next is to have my income higher than my expenses. These are reasonable goals and I will be planning specific measures to achieve them.