It is the start of another year and time to share how much money we have spent in the last 12 months, revealing our spending habits in all of their immoderation. I divulge our expenditure for interest and accountability, as we aim to stay within the budget we set when we retired in 2017. Our spending is peculiar to us and comparisons are not always helpful but it does show you don’t need gold-plated pensions to have a good time. Any comments and observations are gladly received.
In 2017 we aimed to live on less than £27,000 a year for the foreseeable future and despite high inflation we spent under that figure for the fifth year running. In 2017, as new retirees, it was a generous amount for us that was around the average UK household spending but was less than we had spent while we were working. Although we had been tracking our spending for years, we didn’t really know how our retirement spending would pan out and, of course, as two vegetarians with no mortgage and a campervan there is nothing average about us! In 2020 we almost spent £27,000 but then there was nothing normal about 2020. In 2021 life was still strange but I am pleased that we have spent a comfortable £4,000+ below our budget. Our annual spending has tended to be a rollercoaster, with expensive years followed by frugal years and this trend, although it makes little sense, has continued.
As in previous years, expensive home improvements that we consider one-off are kept separate and not part of the headline figure. On top of the budgeted expenditure in the usual categories [see below], in 2021 we also spent £2,780 on new garage doors and a living room carpet. Even if this was included we would still have spent under £27,000, so I feel we have done pretty well. Our home improvements spending would have been more and we would have replaced our faded bathroom by now but have you tried getting a bathroom fitter recently?
Here is how our budget breaks down into my different categories:
Essentials – total £8,730 [38% of total spending] [2020 £9,833 / 38%]
Food – £4,142 [2020 £4,703] – We all know that prices have gone up in 2021 so I have closely monitored this spending line through the year and I am surprised it is lower than 2020. We continue to use discount supermarkets for the majority of our shopping and generally cook from scratch. The figures don’t lie and our supermarket spending seems to be inversely related to how much we spend in cafes and restaurants. In 2020 we hardly ate out at all and so food prepared at home was a bigger chunk of our costs. In 2021 we have spent more eating out so I suppose we could expect to spend less in our local supermarkets.
Utilities, insurance & service charges for a 2-bed 57.2 sq mtrs [615.7 sq feet] bungalow – £3,854 [2020 £4,463] – I am also pleasantly surprised that we spent less on our bills in 2021 than 2020 but there is an explanation that isn’t totally about being frugal. We now have two full years in the bungalow to compare our spending on this essentials category. In 2020 some bills were initially more as providers got used to the amount we would use, not realising how frugal we are! For example, our water bills started off at over £30 a month and have now settled down to £18 a month, a better reflection of what we use. We also paid more in Council Tax in 2020 as we had a few months when we didn’t pay anything in 2019 after moving. The January to April lockdown meant that we were home all the time, not something we would expect to do in a normal year. As soon as we were able we were away from mid-April to the end of June and so using no water or energy at home. We did manage to trim some of our bills in 2021 finding better deals for our mobile phones and our boiler servicing contract. In addition we complained to our previous boiler servicing company [British Gas] and received compensation after some shoddy service.
Our health [including tai chi classes] – £734 [2020 £667] – In lockdown we paid for some online tai chi classes to support our teacher and keep us healthy. In person classes re-started in September and we have attended when we can. Most of this money has been spent on new prescription specs and dental check ups.
The money we spend on the essentials above are, in theory, the minimum we need to survive, if nothing goes wrong or wears out and we didn’t own a campervan and never went anywhere!
Stuff (electronics, books, newspapers and other kit) – £3,170 [14% of total spending] [2020 £7,175 / 27%]
Household spending [everything from glue, newspapers and books to bird food, gardening stuff and parts for the bikes] – £2,506 [ 2020£6,189] 2020 was the year of DIY! 2021 has been more about getting out and about. When we do buy furniture we continue to try and buy second-hand and in 2021 we have sourced some fabulous items that will last the rest of our lifetimes. It is hard to call the G-Plan large chest of drawers a bargain at just under £200 but they are beautifully made and the drawers glide in place. A second-hand wine rack and a small cupboard were other good buys from our local GB Antiques emporium. We search out second-hand books in charity shops and the warren-like Pier Bookshop in Morecambe and, even better, when we can we borrow books from our local library for free!
Clothes & accessories – £664 [2020 £986] – Again, I am pleased we haven’t spent more in this category. There have been a couple of essential purchases. My partner wore his hiking boots up lots of hills but eventually the sole lost contact with the body of the boot. Some glue kept them together during our holiday in Ireland but we did have to purchase more this summer. We both also needed new walking shoes and after mine caused massive blisters and bruising on my feet I complained to the manufacturer. They sent me replacement shoes but I am not convinced they were faulty and think it is a design issue and I haven’t dared to wear them yet. In the meantime I had purchased a pair of Vivo Barefoot walking shoes. I love their shoes but hadn’t tried their more substantial styles before and I am really pleased with them. This palaver does mean I bought two pairs of walking shoes in 2021! More frugally, while we were in Ilkley this summer I spent some time in the excellent charity shops in this well-heeled town and purchased some good quality second hand items I needed, including a soft and floaty summery frock for a few quid that is perfect for the four or five days a year it is warm enough to wear such a thing.
Experiences – £9,517 [31% of total spending] [2020 £8,336 / 31%]
Holidays [our favourite spending line] – £3,634 [2020 £2,834] – As well as plenty of nights on campsites, other holidays are in this category. Having had so many plans disrupted in 2020, we were determined to make the most of spending time with friends in 2021 and have had a couple of lovely weekends in hotels in the Lake District. In 2019 we paid for a self-catering cottage holiday with friends in Scotland for 2020. This was obviously postponed to 2021 and, due to another lockdown, has now been postponed to 2022. Is this a record for the longest wait for a holiday?
Restaurants & cafes – £2,225 [2020 £1,309] – After a woeful 2020, our 2021 spending in this category is nearer to our 2019 spending, although we haven’t got back to the regular meet ups and meals with friends in Manchester. We did manage a sociable night at Manchester’s Christmas Market and paying a small fortune for a mug of warming gluwein felt like a massive treat!
Running the campervan [servicing & insurance etc] – £1,280 [2020 £2,093] – It has been a cheap year for the van. No doubt the Blue Bus is saving up for some expensive new parts it wants in 2022!
Diesel for the above ‘van – £1,261 [2020 £1,227 ] – We travelled to northern Scotland and across Northern Ireland to Donegal but certainly haven’t put the miles across Europe on the campervan we would normally do.
Tickets for concerts, football & attractions – £589 [2020 £403] – By the autumn of 2021 we felt ready to attend events and gigs again. We attended a Manchester Literary Festival events and saw Chantel McGregor and Turbowolf live. I have missed live music and it was so amazing to immerse myself in it again for an evening. We have been to see Morecambe FC a couple of times too, where you win some and lose some. In the spring many venues weren’t open but by the time we travelled to Wales in September we could visit a bevy of castles.
Public transport costs – £528 [2020 £360] – Most of this is the cost of going to and from Manchester by train.
Giving – £1,352 [6% of total spending] [2020 £937 / 4%]
Gifts & donations – £1,351 [2020 £937] – Another discretionary spending line that we enjoy spending but try and keep under control. In terms of donations, we have given to some favourite local and national charities throughout the year. Our gift giving has been more extravagant in 2021 due to so many disappointments in 2020. The most expensive gift was treating our son and daughter-in-law to a weekend away in a Lake District hotel. The downside for them was that we came too! Time with them is very precious and worth every penny.
TOTAL SPENDING FOR 2021 – £22,769 – I am very pleased we have kept the spending low this year and still enjoyed ourselves and will indulge in a small pat on the back!
Over my five years of retirement we have spent an average of £24,744 a year.
We are gradually spending our savings but our expenditure doesn’t all come from the money we have squirreled away. As well as my side hustle travel writing income, in 2020 my small NHS pension began. This is based on my many years of part-time and full-time NHS work and is the equivalent to 12 years NHS service. These both help to reduce what we take from the ever-diminishing savings pot. Although retiring early was fantastic, for me, saving was never just about being able to give up work before we were in our mid-60s, it was also about us having the financial resilience to survive whatever ups and downs life threw at us. Let’s hope we continue to stay afloat and thrive.