Our 2021 Spending Breakdown

As we put 2021 out of its misery and begin our trudge into 2022, it makes sense to reflect on the prior 12 months and see where we stand, financially. This post will focus on our 2021 spending.

See also: Our 2020 Spending Breakdown, and our monthly Net Worth Updates

2021 was our first full year as a family of four. It was our first full year in a new state. It was another full year of living and dealing with Covid disruptions. Yet despite all these changes, our spending breakdown actually doesn’t look very different from past years, except for one glaring exception.

A note on our spending report: I’m a minimalist when it comes to sorting our spending into categories. I love tracking and analyzing data, but separating every miscellaneous expense into a separate category is mostly a waste of time. As you folks know (and will become immediately obvious here), just a few categories account for most of peoples’ expenses.

2021 Spending

2021 spending

We spent $95,835 as a family of four in 2021. Holy crap. That easily sets a new record high for us, as it shattered our 2020 spend of roughly $76,000. Our 2015-2019 yearly spending average was in the $50-60k range, so this has been quite a departure from the norm. As we look closer, it’s not very hard to figure out where the increase in spend comes from.

Folks, we’ve got a classic Pareto distribution on our hands.

As you can see, we spent approximately $35k on childcare in 2021 (36% of total spend), and our housing costs were an additional $27k (28%). In other words, those two categories alone account for nearly two-thirds of our expenses. Yikes.

Let’s dig a bit deeper into the details of our 2021 spending.

The Big 3

It’s widely known that average consumer spending is concentrated in three areas, dubbed The Big 3: Housing, Food, and Transportation. According to the Bureau of Labor Statistics Consumer Expenditures Survey, American households spent roughly $39,000, or 63% of their expenditures, on these 3 categories in 2020. We spent $40,797 on these categories in 2021, which makes us average Americans, I guess?

“The Big 3” Spending Categories

Omitting our childcare expenses, these categories would account for 66% of our 2021 spending. That actually sounds appropriate to me: housing, food, and transportation really represent the true “necessities” of life, so this is where our spending should be concentrated.


When comparing 2021 to 2020, our housing situation is obviously the biggest change. We changed states (and regions), from Connecticut to Virginia. We sold our house, and traded homeownership for renting. Finally, we traded 3+ acres, well water and septic for 0.25 acres in a denser suburban neighborhood (with city water/sewer!). Yet, all-in-all, our housing costs didn’t change too much, increasing approximately $2,000.

Our mortgage costs in CT were significantly subsidized by our basement rental, so in reality things will be cheaper in VA. And once we move into the house we just bought, the fixed costs should come down a bit more.

Our utilities are slightly higher now than they were in CT, but that’s also misleading. We installed a solar energy system at our prior home that significantly reduced electricity usage, and I shoveled free firewood into a stove all winter to keep the home warm. We also had ‘free’ well water and took our own trash to the dump when we were up north, both of which are monthly utility bills in VA.

In other words, we spent a lot of money up-front and busted our asses to lower our utility bills in CT. I’ve really enjoyed the convenience of trash pickup and no water supply issues over the past year. And my septic hasn’t backed up once!

Looking forward to 2022, our housing costs should be in the $2,100/month range, including mortgage, taxes, insurance and utilities. Maintenance costs will push this number up a bit, but overall I’m OK with roughly $25,000 per year on housing expenses.


Our food spending increased by approximately $1,200, or 16%, in 2021. This was almost entirely due to increased grocery cost, as our take-out spending was essentially the same.

I think I complained in every single net worth update last year about our grocery spending. It’s kind of a pet peeve of mine, because we’ve made a great effort to optimize our food spending. In reality, $550/month on groceries for a family of four isn’t that bad. It works out to $1.51 per person per meal, which is actually quite reasonable.

My final analysis of our increase in food spending?

  • 10% increase because we no longer have our preferred low-cost grocer, where we bought tons of past-date produce (“used foods”).
  • 5% increase due to our cumulative family mass growing by 5% (kids weigh more and eat more).
  • 5% due to inflation.

I promise, I’ll stop bitching about groceries. $550-600/month is just the new normal.


Our transport expenses were 25% lower in 2021 than in 2020, but the difference is marginal in actual dollar terms ($1,500 decrease). Our 5-year average has been in the $4,000/year range.

As mentioned previously, our cars (5 and 8 years old) are paid off, so we have no monthly car payments. I drove approximately 3,000 miles in 2021, and Mrs. BF drove about 12,000 miles. She commutes to work every day, and we took her car to Connecticut 3 times in 2021.

Taxes, insurance, and fuel are all modestly cheaper in Virginia than they were in Connecticut, but not significantly so.

If you read our December update, you know that just bought a used minivan. I didn’t include this expense ($15,500) in our yearly spending breakdown, because I look at it more as Capital Expenditure.

Looking forward to 2022, expenses will surely be higher. Insurance will be about $400 more next year, and there will likely be additional maintenance costs. We will drop back down to two vehicles when our new roommates move on, whenever that is.

Longer-term, I expect that our transportation costs will continue to decline. Over the past 10 years, I’ve reduced my daily commute from 50 miles, to 40 miles, to 3 miles, and now 0. Mrs. BF has a few more years of full-time work, but after she leaves the full-time grind, the majority of our transport costs will be associated with leisure.

Other Core Spending: Childcare and Medical Costs

Now it’s time to address the elephant in the room: we spent over $34,000 on childcare in 2021, which represents an $18,000 (113%) increase over 2020, and by far our largest household expense.

Why the huge increase? In 2020, we only had 8 months of part-time care. Mrs. BF was on maternity leave part of the year, and my family contributed two days a week of daycare duties. Now in Virginia, we’re paying for full-time care, and it ain’t cheap.

Honestly, there’s not much we can do here until I leave the workforce. The cost-benefit analysis says I should keep working, for now at least.

When looking at the big picture, we only have 1.5 more years of 2x full-time daycare in the worst case scenario. After our daughter goes to kindergarten, daycare costs will be on the order of $15,000 per year, which is an easier pill to swallow.

Debt: I’ve mentioned a few times on the blog that Mrs. BF is still carrying some student loan debt. Due to the pandemic, we haven’t had any student loan payments since March 2020. Unfortunately, this changes in May. This could be another impetus for me to leave the workforce, as our new debt payment should be increasing.

The reason we’re still carrying the student debt? Mrs. BF is enrolled in the Public Service Loan Forgiveness (PSLF) program. Assuming all goes according to plan, her remaining debt will be erased in 2024.

Medical: Medical costs were down almost $3,000 versus last year. We spent $4,000 on the birth of our son in 2020 (babies ain’t free). In 2021, our costs normalized a bit, although we did spend about $700 on pediatrician appointments and Covid testing.

Spending on Shopping / Goods

This category is a menagerie including all expenditures that I deem necessary in our household.

Consumables: includes toiletries, cleaning supplies, diapers/wipes, dog food and the like. This category was roughly the same as 2020.

Durables: includes furniture, appliances, electronics, or other semi-permanent fixtures. Last year, I had to replace our CO2 tank for seltzer production ($230), I bought a smart watch ($250), a new iPhone after Mrs. BF’s died ($600), and an additional used bike ($450). These four expenses cover most of durables category.

Clothing: This is the outlier, and the cause of the 27% spending increase in this category. Sure, some of the clothing cost is keeping up with kids that won’t stop growing. But roughly half of the spending was mine. As I mentioned in my August update, I revamped my closet significantly in 2021 after I finally left the laboratory that been destroying my clothes for 15 years. I bought two pairs of shoes, some pants, and some new outerwear. I don’t expect our 2022 clothing costs to be anywhere near this level.

Flexible / Discretionary Spend

My flexible / discretionary category covers everything that we don’t need, but we buy because we like it.

Alcohol: Here’s maybe the biggest shocker in this post: I cut my beer spending in half. What gives? Well, my ‘casual beer drinking’ took a significant hit last year. To make a long story short: when your wife works in hepatology and watches people die from liver disease on a daily basis, it’s hard to convince her that 2 or 3 beers a night is ‘fine’. So my beer drinking is now reserved for social events and occasional evenings. It’s obviously the better move: for my sleep, my mood, my general wellbeing.. and my wallet! The only thing that really sucks is this puts my homebrewing hobby on hiatus. I might have to change the blog name!

Entertainment: After 2020 spending collapse, we’ve reflated our entertainment spend. This category includes $860 to join the community pool, $186 on my daughter’s birthday bouncy castle rental, and $140 for her first soccer league. The rest of the spend is on occasionally going out for drinks, and tickets/entry to some events.

Misc: this is a catch-all category. including shipping costs, random services, domain hosting, etc… $1,200 of the costs in 2021 were for multiple visits to veterinarian, dealing with our dog’s breathing difficulty.

Subscriptions: much like groceries, subscriptions are another pet peeve category of mine. Even though many of these costs are less than $20/month, they can add up – hence death by a thousand cuts.

Here’s the breakdown of subscription costs in 2021:

  • Streaming (Netflix, Disney Plus, HBO Max) – $320
  • Reading (Audible, Kindle, Digital Newspaper Subscriptions) – $285
  • Memberships (Amazon Prime, Costco, mlb.TV, Sam Harris podcast) – $459
  • Music (Spotify) – $158

We use Disney/Spotify every day, so I don’t feel bad spending on this. I probably won’t renew Audible in 2022, as I don’t see the need to purchase any more audiobook credits right now. It’s not really worth cutting much beyond this.

Travel: Our travel spending increased significantly in 2021, but really 2020 was the pandemic-induced outlier. Last year we made three roadtrips to Connecticut to visit family and friends, and one long weekend in Virginia Beach. We spent approximately $700 on lodging, $500 on dog boarding, and the rest on gas, EZ Pass, and food during our vacations.

Other Costs

Last year, I created a special category dedicated to goods I purchased as a result of our move. For example, we sold off most of our furniture and home appliances in CT, and repurchased certain items when we arrived in VA.

In 2021, I purchased a new electric lawnmower / leaf blower, a portable AC unit, and a miter saw, plus some other miscellaneous items. Technically, I could write off these expenses, because we sold over $5,000 of our stuff during the course of 2020 in preparation for our move.

We also spent $786 on gifts last year. Half of this total was gifts for the teachers at daycare, including catered lunches and Christmas gifts for the entire staff. $3,000 a month in tuition, and we still have to give them presents!?! I’m only half-joking: early childcare workers don’t get paid nearly well enough, so anything we can do to show our appreciation is good.

We also made approximately $6,500 in donations in 2021, primarily to Givewell.org. I didn’t include this in our spending total, because I consider it a form of investment (in the wellbeing of others).


Well that basically sums up our 2021 spending. As the years roll on, and we inch closer to achieving FI status, I have learned to stop worrying about every penny that goes out the door. We’ve clearly already reached Coast FI, so the real focus should be on maximizing our enjoyment of life. Slowly but surely, I’m getting nearer to that goal.

One of these days I’ll start laying out specific FI plans, and figuring out what our glidepath from Coast FI > Single income > Semi-retired > Fully retired will look like. Maybe I’ll write something up on this soon.

2022 Outlook

I added some embedded commentary on 2022 spending expectations for various categories above. Assuming I stay employed, 2022 will be another doozy in the spending department. We’ll almost definitely cross the $100,000 chasm for the first (and hopefully last) time. After 2022, childcare expenses will begin winding down as our daughter enters kindergarten, and I’m expecting my career will be winding down also. Hell, I didn’t even expect to be working right now – funny how things work out.

How did your 2021 pan out? Were you way over budget, or under budget? Were your expectations totally off, in one way or another? Let me know in the comments.

Featured image by cottonbro from Pexels

6 thoughts on “Our 2021 Spending Breakdown”

  1. it’s a good thing my wife doesn’t work in hepatology. she would be warning herself and me about our behaviors not being normal. sound the alarm! i’ll bet kindergarten can’t come soon enough for both kids. one thing also that stuck out to me is how cheap your car insurance is. we pay 114/month for our 2 paid off older cars. we have a 2012 and a ’14. i think it’s time i shopped that one around.

    95k sure is a huge amount but y’all still managed to save and invest so that’s great. you’ll be coasting soon and playing mr. mom! that’s a great movie.

    • Needless to say, I disagree with the medical definition of “heavy drinker.” But then again, ‘everything in moderation’ is usually pretty sound advice. I’m really looking forward to not paying $35,000 a year for childcare, but at the same time I’m not in a rush for the kids to grow up. I just wish it wasn’t so damn expensive. Yeah, our car insurance premium was under $800/year for a while, but the rates are starting to creep up again. I’ll probably shop for quotes in a couple months, after we close on the house. I keep trying to remind myself that we don’t really need to save anymore, and to not worry so much about costs. Old habits die hard, I guess.

  2. Nice roundup, Adam and thanks for sharing. I’m going to use your method of treating my new car purchase in 2021 as a Capital Expense which is basically is. I’ve always heard that child care is outrageously expensive, but not having kiddos, I never really have a sense of the actually numbers. This certainly puts things in perspective!

    I totally agree that at this stage it really is about enjoying life and not freaking about every single penny. Here’s to a great 2022 for you and the BF family!

    • Hey Mr. Fate. You came from the corporate world, one-off expenses should always fall under the CapEx category! Yeah, the childcare line item is nuts. Then again, it’s giving me the ability to continue earning. If I only made 50% of my salary, I would quit in a minute, but the pay/bonuses keep going up (not to mention the work from home gig is pretty nice), so we’ll hold steady for a bit longer. Let’s hope 2022 is a great year for all!

  3. Nice report. We’re also in the same ball park of spending as you guys, I’m barely under 100k. Actually nice to see someone else pursuing FIRE in my range. We did have a few outliers that took us above our usually 60-70 annual. I like the way you broke out the Big 3. That really is the beating heart of it all. Yeah man, I can attest to the benefits of cutting back drinking and overall feeling of well being. Plus, I wonder how much money I’ve saved over the last few years during my drinking hibernation. How do you project current known temporary expenses into retirement forecast? Like childcare? or is that too far off to bother with?

    • Hey Noel. I feel like all the personal finance bloggers I follow somehow spend $30,000 a year with a family of 4-5, and it feels impossible to do that. Then again, I shouldn’t anchor to those results, because they’re clearly outliers. I have rough projections for retirement spending, but honestly I haven’t focused on it that much, because we’re definitely going to have a gradual transition, and won’t ‘cut off’ the income in one step. I look at childcare costs as a total fixed value, because it’s not too hard to project. Our daughter has 1.5 years left of daycare before kindergarten, and our son has 3.5 years. At the current run rate, that’s roughly $22k more for her care and maybe $55k for him. Of course the costs never go away, and they just shift into new areas (sports and extracurriculars), but they’ll never be this high again (I hope). Like I mentioned, maybe I’ll put together some actual year-by-year projections at some point, but it doesn’t feel that urgent right now. Thanks for the comment!


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