# A real look at inflation

— 9 min

We have all seen it in the news, and we are feeling it in our own pockets. Things are getting more expensive. I was also quite shocked recently to see that a beer now consistently costs more than 5€ in restaurants, no matter where I go.

However, as a proper conspiracy nut, I do not trust the official numbers at all. So I have my own numbers. I started tracking all my expenses and finances in quite some detail in 2014.

I use gnucash for that, which allows me to categorize things, and create reports from all the data. I can highly recommend keeping track of such things yourself.

I have also been living in the same apartment ever since, so the numbers should be fairly constant. Similarly, my consumption habits have not changed that wildly over the years, and I have always been a fairly stingy person that is not throwing money around.

So lets have a look how things look from my very own perspective. For comparison, I use the official Austrian VPI (Verbraucherpreisindex) numbers.

To summarize, the official numbers say this:

YearChange YoYCumulative Change
2014-100%
20150,9%100,9%
20160,9%101,8%
20172,1%103,9%
20182,0%106%
20191,5%107,6%
20201,4%109,1%
20212,8%112,2%
20228,6%121,8%
2023~5,5%~128,5%

Some NOTES on this table:

• It looks like austria resets the statistics every 5 years, there is VPI 2010, VPI 2015, VPI 2020, etc.
• Since I started my own accounting in 2014, I count the cumulative change from that year.
• There is no official numbers for 2023 yet, and I just approximated it at 5,5%.
• This approximation is based on the VPI 2020 in December 2022 which was 116,1 and the November 2023 which was at 122,1.
• I just assume a growth to 122,5. Doing the math (122,5 - 116,1) / 116,1 gives me 5,5%.

I’m not a statistician and this is just based on my assumptions and some crude math, so I’m curious when the official numbers for 2023 will be released.

Another thing to note is that my wife moved in with me in 2020, and I am tracking our combined expenses. And quite obviously, two people spend more than a single person, so expect a jump in expenses in 2020/2021.

## # Fixed expenses

Here is my expenses related to housing. I live in an apartment block and I own my apartment outright. This number is all the expenses related to that, like maintenance, cleaning, insurance, repair fund, etc.

YearAbsolute NumberChange YoYCumulative Change
2014824€-100%
20151070€29,9%129,9%
20161050€-1,9%127,4%
20171068€1,7%129,6%
20181056€-1,1%128,2%
20191140€8,0%138,3%
20201351€18,5%164,0%
20211886€39,6%228,9%
20221991€5,6%241,6%
20231992€0,1%241,7%

I’m actually surprised this was quite stable or even went lower in some periods. But the grand total change a lot.

Lets take a look at electricity:

YearAbsolute NumberChange YoYCumulative Change
2014364€-100%
2015299€-17,9%82,1%
2016305€2,0%83,8%
2017343€12,5%94,2%
2018360€5,0%98,9%
2019341€-5,3%93,7%
2020387€13,5%106,3%
2021564€45,7%154,9%
2022486€-13,8%133,5%
2023328€-32,5%90,1%

Again, I am quite surprised to see that the numbers have been fairly constant over the years, except for a hard squeeze in 2021. The austrian government implemented a cap on electricity costs at some point, and it looks like I am profiting from that, as the total yearly expense has been going down the last two years.

On to heating:

YearAbsolute NumberChange YoYCumulative Change
2014381€-100%
2015345€-9,4%90,6%
2016323€-6,4%84,8%
2017391€21,1%102,6%
2018367€-6,1%96,3%
2019378€3,0%99,2%
2020372€-1,6%97,6%
2021758€103,8%199,0%
2022727€-4,1%190,8%
20231.034€42,2%271,4%

Now there was a steep hike in 2021, but that is rather explained by more people in the household taking more warm showers. Feel free to insert a joke about men not showing often enough here.

Now the internet and mobile:

YearAbsolute NumberChange YoYCumulative Change
2014359€-100%
2015388€8,1%108,1%
2016432€11,3%120,3%
2017428€-0,9%119,2%
2018423€-1,2%117,8%
2019431€1,9%120,1%
2020505€17,2%140,7%
2021559€10,7%155,7%
2022593€6,1%165,2%
2023613€3,4%170,8%

The years 2017-2019 are interesting because I summed up the internet and mobile expenses. The mobile expenses declined, while the internet got constantly more expensive. Again, the jump in 2020 can be explained by now paying for two mobile plans instead of one.

The most surprising thing for me is that the official statistics claim that communication services got cheaper over the years. That is definitely something I cannot confirm. Maybe the per unit price is lower in total. I was forcibly upgraded to a higher plan a couple of times during the years. I got faster internet, but also paying more. Another thing of note here is that especially in the early years the reliability of the internet was horrible. I was often playing multiplayer games back then, and I had to battle with periods of extreme pings and packet loss.

Maybe the official statistics reflect that you are paying less per MB/s than before, who knows. In total I pay a lot more.

Lets sum up and summarize these fixed expenses:

YearAbsolute NumberChange YoYCumulative Change
20141.928€-100%
20152.102€9,0%109,0%
20162.110€0,4%109,4%
20172.230€5,7%115,7%
20182.206€-1,1%114,4%
20192.290€3,8%118,8%
20202.615€14,2%135,6%
20213.767€44,1%195,4%
20223.797€0,8%196,9%
20233.967€4,5%205,8%

There you have it, I pay twice as much for all the fixed expenses than I did 10 years ago. Sure, there is now two people living in this household, and that is an obvious reason for the larger changes in 2020/2021.

## # Groceries and Restaurants

Lets do the groceries first. This is pretty much everything I spend in supermarkets. So this is not limited to just groceries, but also includes things like hygiene products and other household stuff.

YearAbsolute NumberChange YoYCumulative Change
20141.374€-100%
20151.857€35,2%135,2%
20162.148€15,7%156,3%
20171.492€-30,5%108,6%
20181.446€-3,1%105,2%
20191.259€-12,9%91,6%
20202.070€64,4%150,7%
20213.031€46,4%220,6%
20222.804€-7,5%204,1%
20233.813€36,0%277,5%

Again, I’m quite surprised by the dip in the middle, but I believe that can be explained by a phase where I was experimenting a lot with powdered foods. Or maybe by going to restaurants more, which is covered by the following table:

YearAbsolute NumberChange YoYCumulative Change
20141.549€-100%
20151.085€-30,0%70,0%
20161.745€60,8%112,7%
20171.046€-40,1%67,5%
20181.906€82,2%123,0%
20191.520€-20,3%98,1%
20202.761€81,6%178,2%
20212.741€-0,7%177,0%
20224.060€48,1%262,1%
20231.939€-52,2%125,2%

Another surprise here, we are spending way less money on going out than we used to the previous years. But okay, it also reflects the increase in spending in supermarkets.

Lets sum this up:

YearAbsolute NumberChange YoYCumulative Change
20142.923€-100%
20152.942€0,7%100,7%
20163.893€32,3%133,2%
20172.538€-34,8%86,8%
20183.352€32,1%114,7%
20192.779€-17,1%95,1%
20204.831€73,8%165,3%
20215.772€19,5%197,5%
20226.864€18,9%234,8%
20235.752€-16,2%196,8%

Well sure, obviously for two people, we generally spend more on groceries and going out, its obvious. In contrast to the fixed expenses, this is also something you can control more easily. Like not going out as often, which evidently we didn’t do, which case as quite a surprise to me actually.

# # The grand total

And here is it, the sum total for the cost of living, including housing and basic necessities:

YearAbsolute NumberChange YoYCumulative Change
20144.851€-100%
20155.044€4,0%104,0%
20166.003€19,0%123,7%
20174.768€-20,6%98,3%
20185.558€16,6%114,6%
20195.069€-8,8%104,5%
20207.446€46,9%153,5%
20219.539€28,1%196,6%
202210.661€11,8%219,8%
20239.719€-8,8%200,4%

You can clearly see that spending for two is a lot more than for one, obviously.

Also these numbers only reflect the absolute basics: a place to live and food to sustain oneself. These numbers do not include the wants, like fancy clothing, going to the spa, the cinema, traveling and vacations, or buying new computer hardware or paying for a car which is by far the biggest expense among them all. All those things would probably add just as much to the total as the absolute basics.

And again, I am very lucky that I own my apartment outright, and I do not have to pay any rent. Rent alone would amount for as much as everything else combined.

So all in all, we live a fairly modest life and really don’t spend as much on necessities. But this was also a very small glimpse into our expenses. There is a ton of stuff I left out from this analysis.

This concludes this small deep dive. You can see that the expenses we have more control over have a very high variability. Too much to draw some hard conclusions from. The fixed expenses however are growing at an alarming rate, which is much much higher than the officially reported inflation numbers. Those fixed expenses are also the ones that are best amortized with more people living in an apartment. Or in other words, the grows would probably be the same if I would still live there alone. Do with this analysis what you will.