2020 Annual Expense Review
Welcome to Saving Money with Andrew!
First, a good deal. If you’re a frequent user of DoorDash, get a $50 gift card for only $42.50 using code DASH2020 on Amazon. We order from DoorDash frequently and almost exclusively use gift cards we buy for 10-20% off. Whenever I see a good deal on a gift card, I buy it and add it to our balance in the app.
Next…annual expense reviews:
Each year around this time, we review all of our spending for the year. How do we do it? We use the methods in this post.
Why should you do it? Reviewing annual spending gives you more insight as to where your money is going and, most importantly, helps you identify “leaks” in your spending. These might include forgotten recurring subscriptions it’s time to cancel, opportunities to request new promotional rates on things like cable service, or even something as simple as putting a credit card on autopay to avoid late charges.
What did we find out from our annual expense review? This was a crazy year, and I expected to see some big changes. But surprisingly, we spent almost exactly the same amount of money in 2020 as in 2019.
The categories, however, were dramatically different. Unsurprisingly, travel, daycare, and babysitting fell drastically. Travel, normally about 7% of our annual spending, fell by more than half. Daycare, normally a whopping 20% of our spending, fell by a third.
Where did the spending go? Mostly to Amazon and food. At the worst points of the pandemic, Amazon has been our most reliable source for almost everything. And with our time extremely stretched with balancing work and kid responsibilities, we’ve been leaning more heavily on food delivery. And, of course, we’ve had a bunch of random COVID-related expenses, including masks, tests, home office items, and plenty of other things. Our challenge for next year will be to make sure to keep our budget in check, as our travel, daycare, and babysitting expenses will likely return to normal levels.
For reference, here are pie charts showing our 2020 and 2019 spending (courtesy of the awesome and free Google Sheets). I’d love to hear anything you have to share about how the pandemic has affected your spending patterns.
2020 Spending
For comparison, our 2019 spending:
And now…Andrew’s pick of the week:
Larissa MacFarquhar is one of my favorite long-form magazine writers. She’s also the author of Strangers Drowning, an excellent book about extreme altruism. In her latest piece, When One Parent Leaves a Hasidic Community, What Happens to the Kids?, she tells three stories of parents leaving devout Hasidic communities and the impact on their lives and families. A fascinating read.
I hope this has been helpful. If you liked it, please share it with a friend! Also, please send me your feedback, requests, and success stories.