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Old 07-30-2013, 10:40 AM   #121
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Do most of you early retirees still keep two cars? I've always assumed we'd only need one and have planned to budget approx $200/month to replace it every six years.
I am bad here.... I keep 3. One for DW, One for me and one for fun. as mentioned it is my only weakness.
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Old 07-30-2013, 11:02 AM   #122
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tiuxiu - you have solved my future!
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Old 07-30-2013, 11:05 AM   #123
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One car but plan on getting a bike - I will be living in a bike town. My biggest expense, besides my car payment, has to be my four animals, two who require expensive meds. But I would not give them up - as they transition to that "farm" out in the country, I will probably stay with a one animal friend policy. Now that I think about it - when I was 5 my parents told me that our dog went to live in the country...trauma!
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Old 07-30-2013, 11:20 AM   #124
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Three cars (I am a car guy of sorts):

2013 Hyundai Santa Fe Sport - DW's runabout and vacation carriage

2005.5 VW Jetta turbocharged diesel with tuned ECU - nice, fast, sporty, as economical as a "Prius appliance", but still not my old Corvette

2002 Dodge Ram 1500 pickup - old, 225,000 miles, A/C broken, sucks gasoline and just sits around waiting for one of the kids to need it. Minimal cost - $400/yr insurance.

With my oilfield w*ork continuing until later this year, we need at least two vehicles. After I LR (late retire), we will still want them all.
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Old 07-30-2013, 01:17 PM   #125
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I recently read a blog written by an individual named Darrow Kirkpatrick who retired at 50. His blog is called "Can I Retire Yet?"

He cited a figure that most retired couples live on $4,000 a month on average. He even stated that couples that had incomes in 6 figures prior to retiring only spent $4,500 a month on average. I don't recall where he got these statistics but when I read this I remember thinking the source was credible.

I've not retired yet but I am getting dangerously close. I know what my wife and I spend now but there are things in retirement we want to do that will most likely drive up our spending at least in the early years.

With this said, for those of you in retirement, does the $4,000 spending per month seem plausible?
Yes - we live on $4800 per month. Our prim. home is paid for and we have
a mortgage on a lake house. This does not include vacations.
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Old 07-30-2013, 01:42 PM   #126
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We still keep two vehicles. But we live on a rural area. Most of DH's destinations are west; most of the time I go north. It would be very inconvenient for us to have only one vehicle. Doable, but inconvenient. I imagine we will have two vehicles until we are on our late70's or so.
+1 rural area and it seems DW and I are either heading in different directions or in the same direction at different times. I can't imagine making do with only one car.
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Old 07-30-2013, 01:56 PM   #127
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I am bad here.... I keep 3. One for DW, One for me and one for fun. as mentioned it is my only weakness.

I was doing the same thing until I retired last month. Now I am selling one of the three cars....but keeping the fun one that won't go in snow deeper than an inch or so (with winter tires and wheels that I plan to purchase with the money from the sold car). We "usually" have mild winters, and if we don't, I guess I'll be begging DW for her car that has 4-wheel drive.
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Old 07-30-2013, 01:59 PM   #128
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I guess that it depends on where you live and what your individual activities.

We have two cars. One be going to my son. We live in a large city-near good public transit.
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Old 07-30-2013, 01:59 PM   #129
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We did OK on one car for over ten years. We recently became a two car family. We loved having one car because it was so so cheap. Inconvenient, but cheap. We expect to go back to one car when we FIRE. We also have two bikes. . and a riding lawnmower.
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Old 07-30-2013, 02:14 PM   #130
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We have 3: his, hers and a truck to pull the camper. When we get over the camping urge (no sign of that yet) we'll drop down to 2 cars. Our schedules make it a pita to have only one car so, as long as we can afford it, we'll go with 2.
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Old 07-30-2013, 02:24 PM   #131
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You will find people on this site who spend a lot less that $4k per month and those that spend a lot more than $4k. Depends on a variety of factors....mortgage payment, yes or no. Retiree health care...yes or no. I could go on and on.
And it depends on what you mean by "spend." I'm always surprised when folks leave out expenses like taxes or discretionary spending like vacations or dining out.

IMHO, if a couple is going to state that they can live nicely on $48k/yr in retirement, they should mean $48k gross covering ALL expenditures they'd prefer to make for life to be "nice." And even with that level of consistency in defining income and expenses, other factors such as supporting capital (paid for house, room for a big garden etc), skills (do all home maintenance and car repairs yourself, etc) or health needs come into play.

DW and I could not do it on $48k here in the Chicago suburbs. We understand how we'd do it if we had to, but we wouldn't have retired early (55 and 58) for that lifestyle.
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Old 07-30-2013, 02:32 PM   #132
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And it depends on what you mean by "spend." I'm always surprised when folks leave out expenses like taxes or discretionary spending like vacations or dining out.

........
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Old 07-30-2013, 05:14 PM   #133
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Our property taxes would eat up more than half of that. .
That's downright scary, simple math means you are paying somewhere around $25,000/year in property taxes - that's 4 time as much as what I pay for a 5BD house on almost 200 acres (in a rural part of New England).
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Old 07-30-2013, 06:57 PM   #134
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And it depends on what you mean by "spend." I'm always surprised when folks leave out expenses like taxes or discretionary spending like vacations or dining out.

IMHO, if a couple is going to state that they can live nicely on $48k/yr in retirement, they should mean $48k gross covering ALL expenditures they'd prefer to make for life to be "nice." And even with that level of consistency in defining income and expenses, other factors such as supporting capital (paid for house, room for a big garden etc), skills (do all home maintenance and car repairs yourself, etc) or health needs come into play.

DW and I could not do it on $48k here in the Chicago suburbs. We understand how we'd do it if we had to, but we wouldn't have retired early (55 and 58) for that lifestyle.
+1
If 48K was sufficient for us we would have retired 5 years ago. DW retired a year ago @59 and I plan to retire next March. Our retirement budget is 75k excluding income tax which would be minimal until RMD.
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Old 07-30-2013, 10:56 PM   #135
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I've been retired two years. My wife will work 3+ more years as an elementary school teacher. Per Quicken we have consistently spent ~$100K/year for the last four years.
Since I'm a fancy man we don't pinch pennies but honest to God we are not particularly extravagant. House is paid off. 1500 square feet, built in 1955. We drive two 10+ year old cars. Here's where it goes: We live in Los Angeles county. We have two teenage boys, age 15 and 17. I buy toys on Amazon, maybe $10K/year. We spend about $10K/year on vacations. My wife loves to eat out. I'm hoping when DW retires and the boys are out of the house we move to a sane state and get our budget down to ~75K/year in 2013 dollars.
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Old 07-31-2013, 12:26 AM   #136
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$4000/month is just fine......as long as my 2 rental properties continue to have good renters that pay each month.

Actually, $5k/month is a workable number for us. But we have several hobbies, and Amazon is my friend.

Home and 3 vehicles along with boat and camper are all paid for.biggest expense is health insurance.

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Old 07-31-2013, 12:42 AM   #137
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No mortgage. Truck payment (657). Few months on car loan (233) Long term health insurance payments (700). $3850 a month ( after taxes and after health insurance premiums taken out of pensions) just about covers everything essential. ( we're also covering a few things for son - insurance and a car lease). We could lose the truck, except it hauls the camper. It really is not essential.

$4k a month after taxes should be doable for a well prepared and frugal retiree, depending on where they live.
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Old 07-31-2013, 02:18 AM   #138
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That's downright scary, simple math means you are paying somewhere around $25,000/year in property taxes - that's 4 time as much as what I pay for a 5BD house on almost 200 acres (in a rural part of New England).
Yes, and its a modest home (~2400 sq ft) on 1/3 acre. Westchester county has the highest property taxes in the country. People pay it because of good schools and an easy commute to high paying jobs in the city. FWIW, 1/3 of that sum goes to local pensions.

In NYC my taxes were only 4500 on a property worth 3 times what my current house is worth. But there lots of people pay 30k per kid per year for private school, so the deal in Westchester starts to look like a bargain, especially with more than one kid.
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Old 07-31-2013, 06:53 AM   #139
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Yes, and its a modest home (~2400 sq ft) on 1/3 acre. Westchester county has the highest property taxes in the country. People pay it because of good schools and an easy commute to high paying jobs in the city. FWIW, 1/3 of that sum goes to local pensions.

In NYC my taxes were only 4500 on a property worth 3 times what my current house is worth. But there lots of people pay 30k per kid per year for private school, so the deal in Westchester starts to look like a bargain, especially with more than one kid.
But when comparing local taxes between NYC and an area outside of NYC, shouldn't you include the NYC income tax which is used to offset property taxes (and collect from the many renters in NYC)? You probably still pay more to Westchester anyway but it would make the comparison better. (I am assuming you do not live in Yonkers which has a small, local income tax; you would have to include that.)
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Old 07-31-2013, 07:16 AM   #140
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And it depends on what you mean by "spend." I'm always surprised when folks leave out expenses like taxes or discretionary spending like vacations or dining out.

IMHO, if a couple is going to state that they can live nicely on $48k/yr in retirement, they should mean $48k gross covering ALL expenditures they'd prefer to make for life to be "nice." And even with that level of consistency in defining income and expenses, other factors such as supporting capital (paid for house, room for a big garden etc), skills (do all home maintenance and car repairs yourself, etc) or health needs come into play.

DW and I could not do it on $48k here in the Chicago suburbs. We understand how we'd do it if we had to, but we wouldn't have retired early (55 and 58) for that lifestyle.
+1

Our target $100K/year budget is due to covering all of those factors. Estimate for taxes, mortgage, heath insurance premiums for us alone are over $3K/month, which on a $4K/month budget would leave $1K for everything else.
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