In , I went through my annual ritual of carrying around a notebook and keeping track of every time I spent money, with an eye to making sure my spending is sustainable under my deliberately limited income.
I took the numbers from what I explicitly spent this month and then added in a few more items: estimates for my utility bills based on those from previous months, and some regular expenses that I didn’t happen to spend anything on this month but that I do spend money on throughout the year and so I felt I should include in the tally. Here is what I found from this year:
|Category||Daily expense||Monthly expense|
|Utilities & internet||$3.99||$121.38|
|California state taxes||$0.61||$18.58|
|Food (eating out)||$0.00||$0.00|
(The numbers may not all add up quite right due to rounding. Also, I adjusted the 31-day October totals to correspond to the average 30.4-day month.)
Here’s how my current burn rate compares with past years (I’ve had to rejuggle the numbers a bit so that the categories remain the same from year to year; and in many past years I didn’t account for sales tax separately, which probably messes up the numbers a bit):
|Internet (hosting) fees||$15.23||$7.53|
|Food (eating out)||$34.35||$0.00|
Not included in any of the above totals were any business expenses (since I write these off against my business income), my health insurance premium (which, as a self-employed person, I can also write off), or any medical expenses that I paid for from my pre-tax Health Savings Account. I started separating California state sales tax into its own line item, and I have combined that with my expected California income tax bill (I don’t resist my state tax, just as a matter of picking my battles).
A $13,985/year burn rate is quite sustainable given my current technique of staying below the tax line by keeping my adjustable gross income below $17,750.
Here are the results from years past, if you’d like to compare: