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Old 01-02-2011, 11:24 AM   #101
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...the house is the last big debt expense...........
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Then you will be, in classic Dave Ramsey fashion, "DEBT FREEEEEEE!!!"
2032...
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Old 01-02-2011, 11:34 AM   #102
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Why not post one?
And make the answers dependent upon Audrey's formula.
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Old 01-02-2011, 11:40 AM   #103
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....All said, though, 2010 was an expensive year, starting with a major remodel, new roof, new chimney, new girlfriend... But these expenses were budgeted for a number of years, and came from savings, and hopefully most of them won't be repeated anytime soon. Well, except the GF......
Eh, just do what businesses do for extraordinary expenses--claim the expenses as a one-time charge against earnings. Repeat annually as needed for the new girlfriend (and congratulations!).
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Old 01-02-2011, 11:41 AM   #104
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As mentioned above, all of my spending falls within my 3.5% SWR.

The set-aside for the car may have seemed confusing but it is just simple arithmetic; most of us do not include our entire net worth when computing SWR. Money for the car was set aside years before retirement, and was never considered to be part of my ER nestegg in my retirement computations.
Same here.

Accounts not included in the SWR are a Roth IRA dedicated to LTC expenses and we pay into that every year, plus we have bank savings accounts that are used to save for major purchases such as cars. Some years expenditure will be well over a target budget, but exceeding the target SWR of 3.5% will be avoided if at all possible.

There are many ways to manage your money and this happens to be our way.
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Old 01-02-2011, 11:44 AM   #105
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When I prepare our estimated retirement budget, I include monthly phantom payments to a sinking fund for predictable major expenditures (home painting, new car purchase, etc.)
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Old 01-02-2011, 11:48 AM   #106
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Exactly how much do you budget for a new girlfriend ?
You can't put a price on love...
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Old 01-02-2011, 11:53 AM   #107
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It'd be great to have a tripwire when you whip out your smartphone or credit card-- "Amount remaining this month on 'entertainment' category: $7.43"

Otherwise it's being able to limit yourself to one meal out a week or one article of clothing shopping or some other reminder that's vaguely related to the size of the category.

I think their best advice is to carve off the savings/emergency-fund amounts before anything else even lands in the checking account.
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Old 01-02-2011, 11:55 AM   #108
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I am single, no kids, no mortgage or debt. I live with my SO which means some common expenses are shared, lowering my overall expenses. In 2010 I spent $15.5K, not including income taxes. I still do some pt w*rk, otherwise I'd be paying very little income tax.

I include a "bucket" in my budget every year for unexpected large expenses and/or accrual for major purchases. So I typically budget between $20-22K, but hope not to spend that much. Some year when one of those large expenses hit, I will hopefully remember all these years with leftover $ in my budget before I pass out.
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Old 01-02-2011, 11:55 AM   #109
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I think there is a lot of creative figuring going on . I only spent this amount but it doesn't include this or that . That is fudging the facts . You total up all your expenditures and the number you get is reality . Anything else is a fantasy !
While this thread is about expenses, they can't be looked at totally in a vacuum. If an expense such as income taxes rises because the income itself rises, then it is not very relevant to the overall expenses because the money to pay those increased income taxes will always be available to pay them from the increased income.

If the income source is not a recurring one (which for me was an large, unexpected short-term cap gains distribution from a bond mutual fund), and was not part of the budgeted income, then I am not concerned about the taxes somehow busting my budget. I do have to be more careful about planning how and when to pay the additional taxes via estimated tax payments and the annual April tax payment the following year (to avoid any tax penalties).

And W2R, it is interesting how close our expenses are to each other's.
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Old 01-02-2011, 11:57 AM   #110
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I was only joking about our spending without a budget. A rough budget is important. However, for years we have been practicing LBYM with lots of money left over for savings. Even now, I still bring in enough part-time income to live on, but I do not anticipate that to continue until I die.

So, at some point, I must be sure that I really live within the boundary of my investments. I have been a bit cavalier about it, because I know that I can go into Uncle Mick's mode if faced with hard times (though I would rather not). So far, it appears that if (that if again) I do not count the one-time charges for toys, and time-limited expenses like my children college costs, I should be doing well with 3 to 4% SWR, even without SS which I expect to get some.

So, I have been concentrating more on the investment side than tracking expenses. Being invested in individual stocks requires me to pay attention, and so far I still enjoy it. But at some point, the expense side will need some monitoring just to be safe.
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Old 01-02-2011, 12:07 PM   #111
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Eh, just do what businesses do for extraordinary expenses--claim the expenses as a one-time charge against earnings. Repeat annually as needed for the new girlfriend (and congratulations!).
I can say with some certainty that I will NEVER EVER participate in another major remodeling!

Roof again in 15 years or so, unless a hailstorm comes along at an opportune moment...

As for the new GF, having been around this block a time or two, I can say with certainty that nothing is certain. But she's cheap frugal like me...

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You can't put a price on love...
Couple hundred an hour?

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Old 01-02-2011, 12:10 PM   #112
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Crap, I just totaled all my spending for 2010, taxes, new car, everything. It was close to 150k. Next year my taxes should be about 12,000 less and I shouldn't need a new car for awhile, we were a little more generous than usual also. I think Ill just go back to watching my net worth and after tax spending. Thank god we don't have any debt.
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Old 01-02-2011, 12:42 PM   #113
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While this thread is about expenses, they can't be looked at totally in a vacuum. If an expense such as income taxes rises because the income itself rises, then it is not very relevant to the overall expenses because the money to pay those increased income taxes will always be available to pay them from the increased income.
This is why I look at both total spending and total spending apart from taxes.

If I look at the amount I need apart from taxes, I can get a rough idea about how much more than that I would need for taxes and add that to my total required pre-tax income when I retire. And the amount I would need for taxes is a LOT lower than the taxes paid now (and there would be no Social Security taxes, at least under current law).

We actually don't have anything resembling a budget. But I do look at our cash flow each month and as long as I'm satisfied with it, no action is needed. If it starts getting a little less positive than I'm comfortable with (and it's not because of a large, planned expense), then we cut back on spending a bit.
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Old 01-02-2011, 01:01 PM   #114
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After reading all these posts on how little is spent (IMHO) during the year, I feel like I should leave the forum ...

Assuming you get close to the maximum in IRA/401(K) contributions, along with such low expenditures, we must have a lot of current/future multi-millionaires posting here...
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Old 01-02-2011, 01:06 PM   #115
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That's quite the car. What did you buy?
I bought a 2010 Honda Fit. I base my expectation that it will last 30 years on the length of time my 1980 Toyota Corolla has lasted.
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Old 01-02-2011, 01:20 PM   #116
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After reading all these posts on how little is spent (IMHO) during the year, I feel like I should leave the forum ...

Assuming you get close to the maximum in IRA/401(K) contributions, along with such low expenditures, we must have a lot of current/future multi-millionaires posting here...
I'm with you, there are folks here that spent less on food last year than I spent last month. That includes going out to eat as well as shopping.
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Old 01-02-2011, 01:38 PM   #117
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Assuming you get close to the maximum in IRA/401(K) contributions, along with such low expenditures, we must have a lot of current/future multi-millionaires posting here...
Well, at least those of us who have no pension nor bennies -- not picking on anyone here, just telling the fact -- must really save hard if we expect to survive.
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Old 01-02-2011, 01:40 PM   #118
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Nords,

Thanks so much for being open and sharing this information - it helps my husband and I think realistically about the expenses we have/might have when retired and gives us a range of targets to meet with our income streams. I find this very generous of you towards this community and personally really appreciate it. In fact, I believe that anyone coming to this particular thread along with a few other selected ones would have a wealth of information on how to manage early retirement from many different perspectives.
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Old 01-02-2011, 01:49 PM   #119
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After reading all these posts on how little is spent (IMHO) during the year, I feel like I should leave the forum ...
That's odd interesting. I feel like I don't belong after seeing the excessively high amount that most people here spend. Most of the people here spend more per year than most people I know earn.
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Old 01-02-2011, 02:41 PM   #120
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That's odd interesting. I feel like I don't belong after seeing the excessively high amount that most people here spend. Most of the people here spend more per year than most people I know earn.
I'm amazed to see people spend ~5 times what I 'earn'.
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