I have had REALLY big swings year to year which is why I am doing a 5 year average. One year I buy a new car, do a home renovation, then my furnace dies. The next there is nothing big at all.I endorse this message. I never found the "line item budget" (like the OP) to be overly helpful. Invariably something gets left out, or the numbers (rounded to nearest hundred) either overestimate or underestimate actual expenses.What I do is look at "total spend". How much leaves my bank account (paying off my credit cards and direct pay utilities, etc) - add it up for the year - divide by 12. Only takes a few minutes to dump my transactions to a spreadsheet and do the math. It is a good sanity check if you are only estimating by categories. I do this now for retirement planning - average over the last 5 years and then assume some percentage increase for inflation. It is far easier than working thru all the categories (I stopped entering nickels and dimes in quicken years ago).
In our case, everything ultimately comes out of bank account, including credit cards, direct pay, etc. Bank provides a total debit on each monthly statement. I back out items that don't really belong in cost-of-living (e.g., reimbursed travel for work, one time transfers of cash to Vanguard, etc). The remainder goes in spreadsheet. Takes about 15 minutes to record for entire year.
I was surprised to see how consistent our total spending was from year to year, despite monthly ups and downs. And now I can see how it is changing in retirement, increasing due to travel in the go-go years.
Statistics: Posted by GoldStar — Thu Oct 02, 2025 4:45 pm — Replies 120 — Views 4933