2017 End of Year Money Diary: Cost of Living in Los Angeles

The Origami Life couple made some progress in December 2017. We were able to save $5,172 in December 2017 and now officially have $32,228 (out of $40,000 goal) saved for our round the world trip savings. With less than eight months left until our big trip...we're getting really excited about our next chapter!


December 2017 Money Diary

 
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The Origami Household:

2017 Financial Year in Review


Ivan here.

Total household spending last year was $37,675, or roughly $3,140 per month. If you take out the $1,000 in charitable donations, the average drops to $3,056 per month.

$3,056 per month is the cost for a married couple in their late 20s to live exactly the way they want in one of the costliest cities in the world. At this budget, we never deny ourselves anything.

This is privilege and wealth above and beyond our contribution to society.  Our financial goal for this past year was to save over 50% of our income and spend $37,000 for the entirety of 2017. We succeeded in the first (57%), but overshot the second by $675. We’re not going to beat ourselves up over this. Life happens. Nobody’s perfect.

This year, we’ll do better.


A Closer Look at Our 2017 Expenses: 

Things We Prioritized and Things We Gave Up


 
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Jennie and I believe an effective budget includes priorities AND sacrifices.  If time and money are finite resources, prioritizing certain things means giving other things up.

Here’s a detailed breakdown of what we prioritized and what we gave up over the past year in each of our expense categories:
 

What We Spent On Rent and Bills:

$19,904 a year, $1,658 per month

 
 

We Prioritized Month-to-Month Flexibility

One of our goals at the beginning of the year was to move to a different neighborhood in Los Angeles that was: (a) more aligned with our way of life and (b) cheaper to rent.

At the beginning of 2017, we went to several showings of apartments in different neighborhoods. Then we ran the numbers, and concluded that the cost savings wasn’t worth the effort. In April, our current lease on our studio expired and moved to month-to-month. By some miracle, our landlord didn’t raise our rent this past year! With only 8 months left now before we leave LA to go on our round the world trip, we decided to prioritize flexibility over signing another one year lease.

We Gave Up (Most) Subscriptions

Outside of essentials like internet ($65 per month) and phone ($60 per month), we stay away from paid subscriptions of any kind. Ok, one exception was Costco ($55/year), but since Jennie got rid of her car, the savings on gas becomes irrelevant to us in 2018. Therefore, Costco is getting cancelled. 

The reason businesses love the subscription model is the reason we hate it. Paying someone for the privilege to consume (in time or money), with fees that are renewed automatically whether we’re using it or not? I’ve got a better idea: why don’t you pay me? Because unless your business offers something I couldn’t live without, you need me more than I need you.
 

What We Spent On Groceries:

$3,683 a year, $306 per month

 
 

We Prioritized Cheap, Fresh Produce

In Southern California, we have an embarrassment of riches in terms of cheap, fresh produce available at farmer’s markets year round: black kale by the bunch, every variant of orange and stone fruit (e.g. nectarines, plums, and pluots) in the summer, and avocados the size of softballs.

We Gave Up Meat & Poultry

If I were to give a rough estimate, I’d say we consumed 50% less meat in 2017 than we did in 2016. While I’d like to say this was for ethical or health reasons, the truth is far less mature and admirable: we just don’t like handling raw meat when we cook. It wastes time and makes us lose our appetites. We’ll still order meat when we eat out though.
 

What We Spent On Education & Investments:

$3,527 a year, $294 per month

 
 

We Prioritized Functional Investments and Passion Projects

Expenses in this category include the following:

  • Educational fees (eg. Ivan’s final CFA exam fee and immigration processing fees)

  • Jennie’s art supplies

  • Ivan’s books

  • Round the world trip gear that we’re steadily accumulating in preparation for September 2018

At the beginning of 2017, Jennie created a list of ALL the items we’ll need for our round the world trip (Jennie’s note: Because I’ve got foresight and I’m awesome). Then it was just a matter of setting up automatic price alerts (we recommend Honey) and waiting patiently for the right deal to be delivered to our inbox. Because we planned in advance, we were able to take advantage of retail pricing strategies, instead of letting retail take advantage of us. I follow a very similar approach for travel hacking and airline points. Our tip? Have a plan and work backwards. The longer you can wait on things, the cheaper you can get them for.

We Gave Up on Style and Fashion

Any sort of investment in style and appearances took a backseat in 2017. We spent less than $500 between the two of us on clothing this past year. As it turned out, nobody noticed - the staple items in our wardrobe worked just fine.
 

What We Spent On Eating Out & Entertainment:

$3,215 a year, $268 per month

 
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We Prioritized Mom and Pop Restaurants

Jennie and I define “fine dining” as any meal over $40 per person including tax and tip. As the Koreans in K-town have figured out, one way to increase the razor thin margins in the restaurant business and lower your overhead is to set up shop with your family.

We Gave Up Fine Dining and Social Drinking

Both of us feel uncomfortable being waited on for different reasons: Jennie because of her experience waiting tables when she was a teenager, and me because I like being left alone.

We’ve also stopped spending money on social drinking. Outside of a glass of wine, beer, or Soju to make food taste better (eg. spicy food, barbecue, seafood), social drinking is an oxymoron for me, since I grow quieter and less sociable the more alcohol I consume. Then I fall asleep. In Jennie’s case, her tolerance just isn’t what it used to be.  
 

What We Spent On Travel:

$3,106 a year, $259 per month

 
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We Prioritized Family and Domestic Travel

We went on 7 trips this past year:

  1. San Francisco (twice)

  2. Denver for family (twice)

  3. Taipei for family (Ivan only)

  4. Albuquerque for family (Jennie only)

  5. Camping in Yosemite National Park w/ friends

  6. Camping in Joshua Tree National Park w/ friends

  7. Cross country train trip across the USA (8 cities in 15 days)

Seeing as how both of us might be gone for a very long time starting September 2018, we prioritized family and North American friends this year. This had the unintentional benefit of saving us a lot of dough on accommodations.

We Gave Up International Travel

 
 

For now. We’re giving up international travel for now.
 

What We Spent On Other Miscellaneous Items:

$2,052 a year, $171 per month


We Prioritized Breakfast Together

On average, we spend $7 per day, five mornings a week, for breakfast and coffee together. Jennie and I have grown quite attached to the Cambodian husband and wife team that’s running our favorite donut shop, and we’ve made it our personal mission to transfer all of our miscellaneous budget to them.

It’s nice to walk into a place and be treated like regulars. The donut shop in the morning is also where we come up with most of our ideas for this blog.

We Gave Up Processed Junk Food

 
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Sort of. Jennie has a Shin Ramyun and Hot Fries addiction so she’ll buy a bag every now and then. For me, it’s all about gummies. Not for the taste or sugar - I just like to chew on stuff. My favorite is the Haribo Egg (Oeufs au Plat) Gummies I discovered on a trip to Paris in 2016. They’re tough and have the consistency of rubber (which is good because they last longer).

And that’s our financial year in a nutshell!

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What are some things that you’ve prioritized in 2018? 

What are the things you’re willing to give up for it?

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