It is just less than three weeks to the end of the year.
Time to do some reviews. I will start with expenses first, before touching on income in the next post. I will then do my usual review on my investment performance.
Money is the means, not the end. It is important therefore to ask ourselves what are we saving or using the money for? With that in mind, I renamed the expenses categories during the year, so that they are meaningful to me.
I am glad to say that not only did I not burst my budget, I am spending on average $1k less per month.
The figure is just slightly higher than the $6,693 figure from the LKYPSS study on minimum income standard for partnered parents with two children, one aged between seven and 12 and the other aged between 13 and 18.
I found the report interesting but I do not agree to the use of the words “minimum” and “basic” in the report, as that blurs the line between what are wants and needs. I am with the ministries’ stand that the report should be interpreted as “what individuals would like to have”, instead of basic needs.
The word I use is “simple”. When asked by friends/colleagues why I am brave to give up my regular salary, one factor that I often mentioned is that my family lives simply, like what is mentioned in the report.
Breakdown by categories
The actual spendings in most categories is less than budgeted amount. That is expected as I normally include some buffer when budgeting. Two categories have spendings more than the budget – “feeling and looking good” and “contributing to the community”.
There were a few exceptional items such as LPA for spouse and myself that wasn’t planned for last year, and also I needed a new pair of progressive lens! For the other category, it is not that I am more generous this year with my donations, but income tax for 2022 is higher than what I have expected. I probably hit the next tax bracket due to a one-off bonus.
I spent a lot less for “creating a lovely home” as some of my appliances and furnitures survived another year. Spending on them are inevitable as we had them for a long time. So it is likely they will be replaced next year.
Insurance by right should not be different from budget, but a change in payment date resulted in the adjustment. I am still considering on downgrading my private hospitalisation plan. A few more months to do that before premium is due next year.
Next year, some expenses such as income tax, daughter’s braces and piano lesson will be dropped. However, some expenses such as vacation and buying of appliances and furniture will increase. Also, with the recent increase of tariff for electricity and water, and another percentage increase for GST, expenses are expected to go up.
Hopefully, I can keep to within $7.5k per month.
Coming up in the next post will be how I fund my expenses.
Referral
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Trust Bank (code: 1X9DDP1V, additional $10 Fairprice voucher)
Keppel Electric
FSMOne (code: P0003528)
StocksCafe (code: TFI)
Moomoo
Webull