The two questions that had me worried when I first went FIRE were, will my expenses be under control? Will my income continue to outgrow inflation? Even with all the worst-case scenario calculations I’ve made with years of planning, trying to understand and cover all outcomes, some worries remained. After all, it is an unusual change in one’s life going FIRE at such an early age.

Here is a look at few key living expenses to see if there were any noticeable impact to costs over the course of FIRE lifestyle.

 

Electricity

2016 – $847.56

2017 – $837.86 (-1.1% decrease from previous year)

2018 – $883.70 (5.4% increase from previous year)

Surprisingly, my electricity costs didn’t move much. I assumed my costs would be higher being home more often but that was not the case. Generally, I don’t really use much electricity. I did replace a 15-year-old refrigerator, and 9-year-old washer and dryer, which are much more energy efficient that may have helped save energy. In 2015, the ancient condenser and furnace had some issue, so they were also replaced to more efficient units. Being an older home, with few upgrades when purchased, some of the lighting fixtures used fluorescent T12 bulbs (Highly inefficient) in the kitchen and bathrooms. They were upgraded to fit LED bulbs.

Doing the remodel myself helped save lots of money on labor costs leaving me with material costs in total of $406.68 for the kitchen. The bathroom savings were comparable. The lighting upgrades in and outside the house brought a noticeable drop in electricity costs from above $100 per month to below. Another fun way I save is through a site called OhmConnect. They pay you for saving electricity on scheduled days for 1 hour. What I really like from OhmConnect is the promotions they have periodically giving away free wifi plugs and nest thermostats to help you automate your savings.

 

Water

2016 – $729.05

2017 – $615.60 (-15.5% decrease from previous year)

2018 – $569.10 (-7.5% decrease from previous year)

Water costs have come down over the years. The only thing I can think of that may have contributed to saving water was upgrading my outdoor irrigation system with water efficient irrigation heads and drip system for the plants. In effort to save more water, I also planted more drought tolerant plants.

 

Gas

2016 – $418.72

2017 – $381.21 (-8.9% decrease from previous year)

2018 – $352.21 (-7.6% decrease from previous year)

Once again, dropping utility costs! This one is probably to do with cooking more often in my backyard using my portable bbq grill. I don’t like the house to smell when cooking certain foods indoor so I often cook in the backyard using my grills. Living in Los Angeles with its weather, I rarely use the heater if ever.

 

Trash

2016 – $418.72

2017 – $381.21 (-8.9% decrease from previous year)

2018 – $352.21 (-7.6% decrease from previous year)

In 2016, the trash company that serviced our neighborhood was replaced with another company due to neighbors complaining about rising costs. Soon after, prices noticeably dropped.

 

Internet

2016 – $659.88

2017 – $659.88

2018 – $687.77 (4.2% increase from previous year)

In 2017, the company servicing my home, Verizon, sold their customers to Frontier communications. Once the transition took place, they raised the price a year later.

 

Cellular

2016 – $1,660.93

2017 – $1,297.45 (-21.8% decrease from previous year)

2018 – $1,761.17 (35.7% increase from previous year)

I currently have a family plan with 3 phones. In 2017, I lowered my data plan to see if I can get by with 10GB’s of data. It saved me a lot of money but I felt the data limit was a little tight. So, I raised the data back up a tier in 2018. This year 2019, I lowered this back down to 10GB after seeing how much unused data I accumulated in roll overs. Hopefully, I can keep this at 10GB being more frugal in using Wi-Fi whenever I can outside.

 

Auto Insurance

2016 – $1,343.98

2017 – $1,574.90 (17.1% increase from previous year)

2018 – $916.16 (-41.8% decrease from previous year)

I went from owning 4 cars in 2015 to 2 as of today. In 2018, I sold a truck I used for my business. It was just sitting on my lot rarely utilized so I let the car go. That brought some savings on insurance as shown above. My coverage is for 100k/200k with collision and comprehensive. I haven’t had any claims as far as I can remember which brought my premium down dramatically after shopping around. I am currently insured with Geico.

 

Groceries

2016 – $5,422.43

2017 – $9,087.15 (67.5% increase from previous year)

2018 – $7,556.50 (-16.8% decrease from previous year)

I love food and clearly, it showed in 2017. My plans are to keep my annual grocery expenses around $7,000. It looks like I may need some discipline in this department this year.

 

Conclusion

Surprisingly, my utility costs have not dramatically increased overall. Perhaps 3 years is not long enough to notice much. However, I am definitely not complaining and hope my living costs don’t increase too fast. My projections for inflation regardless is 3% per year, but my goal is to strive for growth in cash flow around or above 6% each year at minimum.

What’s interesting is, investing in things around the house that raise efficiency may cost more on the front end, but the savings are notable at the back end. I have no idea how long I will enjoy the savings before I sell my home to move but nevertheless, it’s encouraging to see the savings.

Having a home that is paid off free and clear really brings another level of freedom. There are property taxes and insurance I did not include here but I will write more on those topics on another post.

Are your utility costs under control? How do you save on rising costs? I would love to hear from you guys! Thank you for reading.