Got some free time? Help me build a budget for

[Scrooge]

Quote:

Originally Posted by astromeria I don't understand your classification of drugs. Shouldn't that be either Medical or Entertainment? 8)

Good point*

For better or for worse, I stopped keeping track of cash expenses years ago when I decided that it was more trouble than it was worth. So many places take credit cards these days that I just grab $200 whenever I run out, once a quarter or so, and then make a note of the ATM withdrawals at the end of the year. Hence there is no way of telling how much of it was spent on drugs (a $10-15 deductible depending on the insurance), snacks and other minor expenses.

Oh, and if you factor in my car costs, it would add about $1,250/year based on their lifecycle. A basic $15-17k Japanese sedan is an amazingly reliable and undemanding workhorse* 8)

[Sam]

Quote:

Originally Posted by Scrooge Sure thing! Here it is (July 2005-June 2006):

AMAZING!

Did you miss your phone bill, or is it paid for by your client/employer?

How about clothes, shoes, socks...

$2,500 for food.* I venture to say that most of your lunches are also paid by your clients, correct?

Your tax bill (fed, ss, med, and state) is problably 150% of your expense.

You must enjoy your job a lot, because making money appears to have no relevance for your situation.

I have a friend who stays single until 49 (6 months) ago.* He makes very decent money, but is also very frugal.* He was my hero, but no more.* You just took his place*

[Sam]

Quote:

Originally Posted by Scrooge One caveat is that I don't count new cars in my calculations. I have a separate fund for one car to be bought at age 55 and one at age 70.

A Ferrari at 55 and a Rolls Royce at 70?* Not sure if you like those, but I have a feeling that you can afford them*

[dmpi]

Quote:

Originally Posted by Scrooge Sure thing! Here it is (July 2005-June 2006):

First off, I admire a guy that's cheaper than me.
Your numbers are very similar to ours. By the way, I didn't see phone cost on your list.

We spend about $26K/year total & I thought we were cheap....
We spend about $45/week = $2340 on food. Plus DW make sure we eat out at least once a week, that about $1500/year.
Plus we also give our parents (& in-laws) some money ($2K) to help them out.
We also give to United Way at work ($2K) *

[73ss454]

DMPI,

You guys spend $45. for food a week and still go out to eat?

What's the name of the restaurant? I think I might want to stay out of there.

[Sam]

dmpi,

WOW!

[Scrooge]

Quote:

Originally Posted by Sam AMAZING! Did you miss your phone bill, or is it paid for by your client/employer?

I don't have a land line any more. I carry a cell phone around -- paid for by my employer, as you correctly guessed -- but I hardly ever use it. If I need to make a phone call at home, Skype.com is free until the end of the year and then it will be just $0.02/minute.

Quote:

How about clothes, shoes, socks...

I buy new socks (4 for $5 or so), pants ($10-15 per), white shirts ($10-15 per), shoes ($20ish), etc every couple of years, but it's pretty insignificant and gets counted as part of "toiletry". State of the art razors are significantly more expensive, which I am not crazy about, but my skin insists.

Quote:

$2,500 for food.* I venture to say that most of your lunches are also paid by your clients, correct?

Oh no, I just bring a $1-2 lunch with me. Supermarkets frequently have frozen meals on sale and it's easy to grab 20-30 at a time. Subprime luncheon meat (ends, random pieces, etc) is $2.99-3.99 and works well too.

Quote:

Your tax bill (fed, ss, med, and state) is problably 150% of your expense.

That's a pretty good estimate, especially if you consider that interest is taxable as well.

Quote:

You must enjoy your job a lot, because making money appears to have no relevance for your situation.

I used to enjoy my job, but things have changed in the last couple of years My NW is about $750K+ right now, so I could theoretically retire tomorrow, move to a smaller place in a less expensive part of the country and live on $13-14K/y plus health insurance. However, it would leave me somewhat exposed and who knows what will happen with the health care system in the next 24.5 years (when I become eligible for Medicare)? And who knows how Medicare will evolve in the intervening years? Besides, my once dazzling IT skills are slowly becoming obsolete and if I have to go back to work 10 years from now (I have seen 2 people forced to go back), it could be nasty.

I figure it is better to be safe than sorry, so Plan A is to continue working for another 3 years or so and feather the nest some more while trying to figure out what I want to do with the rest of my life.

Quote:

I have a friend who stays single until 49 (6 months) ago.* He makes very decent money, but is also very frugal.* He was my hero, but no more.* You just took his place*

No need to dynamite his pedestal just because he got married -- it happens to the best of us *

Quote:

A Ferrari at 55 and a Rolls Royce at 70? *Not sure if you like those, but I have a feeling that you can afford them *

For shame! * Of course they will be sensible reliable low-maintenance mid-size Japanese sedans, most likely a Corolla or a Camry. A Camry if I estimate that I have a good chance of getting in an accident (depends on the area), a Corolla otherwise.

What helps make my lifestyle not only bearable, but actually enjoyable, is that most of the things that I go without, from fancier cars to eating out, are of no value to me. The only expensive habit that I found hard to get under control was my book habit. Oh, and it also helps that I did a ton of traveling earlier in life, so for now I am OD'd on traveling and am quite happy to stay at home enjoying my books, movies and the internet *8)

[dmpi]

Quote:

Originally Posted by 73ss454 DMPI, You guys spend $45. for food a week and still go out to eat?* What's the name of the restaurant?* I think I might want to stay out of there.

Yes. We live a state that has *no sales tax on food. We also shop at the asian markets & the gas station turned vegi-market. So our food cost is real low. Also we don't eat a lot of meats. Most of the time we eat out at a Red Robin or Applebyees or something like that. Yumm...

[Scrooge]

Quote:

Originally Posted by dmpi First off, I admire a guy that's cheaper than me.

I admire a guy who manages to stay married while living on $26K/y!

[Sam]

Quote:

Originally Posted by Scrooge I admire a guy who manages to stay married while living on $26K/y!*

I have been considering myself frugal for the last 15 years.* I wonder how many people have quietly laughed at me for being so naive*

[Scrooge]

Quote:

Originally Posted by Sam I have been considering myself frugal for the last 15 years.* I wonder how many people have quietly laughed at me for being so naive*

Well, this is an ER forum, which is clearly a minority pursuit/interest/hobby in America in 2006. So that makes the selection unrepresentative of the general population right there. And then you look at responses from (what looks like) the extreme LBYM fringe of the forum, so naturally you get a distorted picture.

Just because there are people who are even more frugal than you are doesn't mean that you are not vastly more frugal than John Q. Public. It's just that in a country of $300 million, there will almost always be someone better at X than you. Remember Ted Kaczynski, who lived on $300/year?

[dmpi]

Quote:

Originally Posted by Scrooge I admire a guy who manages to stay married while living on $26K/y!*

I use to be even more cheap, but I've loosen the wallet the past couple of years.
Actually I'm lucky because my DW dosn't like want to live simple and not have a lot of stuff.
Be she does like to eat out.... might have something to do with not cooking & cleaning.

Anyway... If you look at the average household median income which is about 45K. Subtract 6K income tax. Subtract 3.6K SSI tax. You can see the average household only takes home 35.4K. We paid off our house so we don't have a mortage. That's about 9K/year we don't pay. The average houselond has 2 kids, while we have none. What I'm getting is 26K/year may seem low, but we live at the standard of living most of America lives at.

[greg]

Quote:

Originally Posted by dmpi Yes. We live a state that has no sales tax on food. We also shop at the asian markets & the gas station turned vegi-market. So our food cost is real low. Also we don't eat a lot of meats. Most of the time we eat out at a Red Robin or Applebyees or something like that. Yumm...

Yes, I bow down to the Master too. May the FIRE force be with you.

[Sam]

Quote:

Originally Posted by dmpi Anyway... If you look at the average household median income which is about 45K. Subtract 6K income tax. Subtract 3.6K SSI tax. You can see the average household only takes home 35.4K. We paid off our house so we don't have a mortage. That's about 9K/year we don't pay.

Very true, but you guys are at least 3 times median!

Quote:

Originally Posted by dmpi What I'm getting is 26K/year may seem low, but we live at the standard of living most of America lives at.

How much do you spend on transportation?

[astromeria]

Quote:

Originally Posted by dmpi We paid off our house so we don't have a mortage. That's about 9K/year we don't pay.

While this isn't essential, it does help many of us FIRE. Our last mortgage (for a nice condo in a three-plex Victorian in San Francisco) was ~$24k/year, plus ~$8k property taxes and ~$2k HOA = ~$34k. But now we have no mortgage, ~$2k/yr prop taxes, and $350/yr HOA. Ditching the huge housing expense was the single biggest factor in our being able to FIRE. Other major factors include lower taxes (less taxable income), lower savings rate as we reached our "number," lower cost of transportation (no more long commutes), kids grew up and became financially independent, living in a lower COL area closer to family. The only bigger expense so far has been travel--but it's still only a third of the old housing expense. (OK, health care costs more, too.)

[perinova]

Quote:

Originally Posted by astromeria But now we have no mortgage, ~$2k/yr prop taxes, and $350/yr HOA.

astromeria
that's low prop tax what state are you in now? I see low country in your profile where is that?

[dmpi]

Quote:

Originally Posted by Sam How much do you spend on transportation?

We have two cars( one 3 years old & one 8 years old), we buy a new about every 12 years. So that's about 44K/12 years which works out to be $3.6K/year for new cars. I didn't count this cost in my 26K/year.
For gas, my wife & I carpool about 12 miles to work. We drive about 12K miles/year. that's about $1500/year for gas. Car licence is about $200/year. We have libility only insurance about $350 year for the two of us. Car maintance is about $375/year.
So, not counting the cost of the car, we spend around $2425/year.
When we FIRE ( around 10 years from now) might get rid of a car.

[Sam]

Quote:

Originally Posted by dmpi We have libility only insurance about $350 year for the two of us. Car maintance is about $375/year.

Thanks for the info.* $350 for 2 cars insurance is very low.* Which company do you use?* You did not mention repair, so I assume 375 is for both maintenance and repair, right?* Sounds like you work on your cars as well (I do too, whenever I can.)

[astromeria]

Quote:

Originally Posted by perinova astromeria that's low prop tax what state are you in now? I see low country in your profile where is that?

The Lowcountry is the South Carolina coastal area--I live just about in the middle of the SC coast in Charleston County (mclesters also lives here, on the far side of Charleston from me). To be more precise, our most recent property tax bill was $2100-something for a 2500 sq ft house on a small lot about 2 miles from the beach (as the crow flies) and 7 miles from downtown Charleston.

[jclarksnakes]

,,,,After reading all the posts on this thread I have a couple of opinons to voice.
1. The 3X rule of thumb the bankers are touting is evil. A little house with a stay at home mom or dad is likely to provide a much happier childhood than childcare and a Mcmansion.
2. 30 year mortgages are just dumb. 15 year mortgages are okay.
3. Car loans are dumb. Car loans longer than 36 months are insanely stupid. Most car leases are somewhere between these two but leaning more towards insanely stupid.
4. Buying any car other than a Toyota or Honda is a financial mistake.
BTW, I drive an 8 year old SS Camaro because I am a horsepower crazed maniac.
5. Mrsjclarksnakes and I are frugal but still spend more than we need to.
6. SCROOGE IS MY HERO!
jc