Welcome to my year end review for 2023! In this post, I review all my family’s earnings, expenses and savings (literally everything!) over the past year.
Feel free to check out my last year end review for 2022.
Consider subscribing to my newsletter if you’d like to receive my easy-to-use Expense and Net Worth Tracker spreadsheet. I use it every month!
December in Brief
December was expensive, with the Christmas holidays, presents, and eating out with family and friends all contributing to us saving less than normal. In total, we saved around $4,000 which is well below our average for 2023.
Despite this, the stock market continued to co-operate and our investment accounts increased by $8,600. Add our mandatory pension contributions and mortgage paydown, and our net worth managed to increase by $15,000.
Quite a strong end to 2023 and we couldn’t be happier!
Cash Flows for 2023
Okay—now let’s look at 2023 overall.
Here’s my master Sankey diagram I created for last year which includes all of the income, expenses, savings, and investment account contributions we made in 2023. All numbers are post-tax.
Unlike in 2022, we didn’t have a huge “Other” one-time income stream (left purposely vague for privacy reasons) to juice our finances. Instead we only had tax refunds totaling $12,500 to account for. Pretty much all of our tax refunds came from RRSP contributions we made in 2022.
We were fortunate to increase our income by $15,000 compared to the previous year. This helped us make some huge contributions to our registered accounts, maxing both our TFSAS (again) and getting very close to maxing our RRSPs. By the time RRSP season wraps up, I expect both of our RRSPs to be maxed as well.
In total we had $92,000 in expenses which is much more than last year’s $85,000. Some of this is from the inflation we all experienced throughout 2023, but most is actually from “lifestyle inflation”—things like travel, gifts, eating out and more.
Housing continues to make up the bulk of our expenses. In total we spent $48,800 on housing including our mortgage, property tax, heating, electricity, maintenance and home items.
How our Expenses Changed
Our fixed expenses (phone, internet, heat, mortgage, insurance, and property tax, etc.) only increased 3.5%. However, our variable expenses increased by 15%, which is where most of our new spending came from.
The biggest changes were both related to our home. Purchasing home items—things like furniture, appliances, kitchen utensils, and etc.—decreased to $2,000 from $5,000 in the previous year. On the flip side, home maintenance increased from $1,000 to $7,000 in 2023.
Other big increases came from health spending (+$2,500) , gifts (+$2,800), and travel (+$1,800). Here’s a few more categories of interest:
- Groceries +15%
- Eating out together +70%
- Fast food +175%
- Coffee +24%
Each of the above four expenses are things we’d like to reduce in 2024. We plan to cook more at home, start meal prepping again, and cut back on the excessive amount we spent on gifts last year. If we can accomplish this we expect to reduce our expenses by $5,000.
Even though our expenses increased a lot in the past year (up $7,000!) our income managed to increase even more. As a result, our savings rate came in at a cool 43%.
This number excludes mandatory pension contributions and our tax refunds. It’s just based on the money we can actually hold in our hands from working. Including our tax refunds would push the number up to 47% and including pension contributions puts it in the 50% range.
Investment Accounts and Performance
Okay, now let’s get into the really fun stuff. Here’s a high-level view of how our investment accounts changed in 2023.
The first thing you’ll notice is we made huge contributions to our RRSPs. Some of you will remember that my goal for 2023 was to maximize these accounts after successfully maxing our TFSAs in 2022. As a result, we really focused on my RRSP which had a lot of leftover space.
You’ll also notice our investment returns were stellar this year. In 2022 our accounts returned around -6% on average while our accounts this year returned around +15%.
This makes sense when you consider VEQT returned 14.79% in 2023 and our portfolio is a mix of ETFs that largley overlaps VEQT.
Thanks to our consistent saving and investing, 2023 was our best year so far when it comes to dividend income. We earned a total of $7,134 which is an increase of 46% compared to the previous year.
I was hopeful we’d increase our divdends by slightly more but for some reason our monthly dividend ETFs (XDIV and XDG) didn’t hit our accounts in December. Oh well, this just means we’ll get off to an even better start in 2024!
Note that although we aren’t overly focused on dividends, it is fun to track them. My wife especially has a passion for seeing those little “paycheques” hit her account every month. Anything that keeps you motived to invest is a great thing!
Total Net Worth
Here’s the number that really matters: our total net worth. As you can see our total net worth has increased consistently since starting my blog, AnotherLoonie.
The biggest increase on this chart came from February 2022 when I accounted for some of the home appreciation we experienced as new homeowners. I haven’t done another accounting like this since as the market has been a little more shakey and uncertain—although our home has increased in value since then.
In the last year, we had no big property value increase and no unexpected income. Just steady saving, investing, and some great stock market performance helped increase our net worth by $165,000 in 2023.
This is a seriously wild number. About $62,000 of this increase came from our investment gains, $14,000 came from mandatory pension contributions, and $16,000 came from home equity (paying down our mortgage). The remainder came from saving our employment income.
Assets and Liabilities
Here’s a look at where we stand when it comes to our assets and liabilities.
On the asset front, the biggest change is our investments. We now have $502,000 invested in the stock market compared to last year’s $366,000. Most of this is investments we own outright, while about $114,000 is investments backed by debt.
Liabilities haven’t changed significantly compared to last year. Our HELOC is a little higher as we’ve been capatailizing its interest. And each month we pay the interest on our other loans so they’ve stayed quite flat.
The number I’m happiest with is our mortgage balance. It has decreased by $22,000 compared to the same month last year.
Looking Ahead to 2024
There you have it! All of our numbers for 2023!
Looking ahead to 2024 makes me excited. Some of our goals include making those final contributions to our RRSPs for this tax year, and then keeping both those accounts and our TFSAs maxed going forward. I’m not sure what we’ll do with money we have leftover but paying down our mortgage more aggressively has crossed my mind.
With some minor changes to our lifestyle habits, we’re hoping to reduce our spending on take out, coffee, gifts and other niceties in 2023—hopefully reducing those expenses by a total of $5,000.
On the back of those reductions, and some income gains, I hope to maintain our 40% savings rate in 2024.
Thanks for Reading
Thank you if you made it this far. Please drop a comment below with any comments or critiques you may have over my 2023 numbers. I am also curious how you did in 2023, and if you met or exceeded your saving and investment goals!
If your interested, check out my past few net worth updates, or read some of my other popular posts like my guide on closing costs in Canada and my how-to article on getting cash back from your realtor!
Consider supporting my blog by sharing or joining me in using any of my recommended services: