How much do you live on?

[bbbamI]

Ah, I forgot to put qualifiers on the $60K that I thought would be OK for most people.

Oh yes, don't ya know we must clarify every post.... Of course then again if we did that, we'd be on the forum 24/7. As for yours truly, that won't be happening because I have to catch up on recorded episodes of 'Desperate Housewives'.

 

[Amethyst]

Disbelieved, I can see, but criticized? For what? Not having a mortgage? Not spending scads of $$?

You gotta find a new audience! Oh wait, you have one here
​

Amethyst

I am getting criticized and disbelieved when I say that for my family - 2 people, with no mortgage on house and health care by my employer (~400$ mo excluded) we spend ~30-35K.

Can you vote on the poll please?

Regards

 

[youbet]

In our case we live on less than double what it costs to live as a single in the following areas:

1) We now only have 1 car We still have our own cars.
2) The gym membership is only 50% extra for husband & wife than single That's a good deal.
3) Cooking for 2 is cheaper I suppose this could save a few bux. But the primary entree incredients still double.
4) when we eat out we nearly always by a single entree and split it We don't do that. But we do use a lot of 2 for 1 coupons.
5) My retiree health insurance is only 50% extra monthly premiums to add DW and the $500 deductible is the same as for a single person. I assume this is a deal through your past employer. Not available for us.
6) Vacations - hotel rooms cost the same for a single person as for 2 We do do that although you could do that with a friend as well.

Good examples Alan. I've thought this through a bit and although I don't keep records that would prove it, I suppose we probably save a few bux per person living as a married couple vs living independently as 2 singles. Perhaps we save 10% or so...... We've just preferred to keep our personal amenities and activities intact throughout our 40+ years of married life. And this comes at a price.

Of course, even if we live to be 234, we'll never come close to making up for the fortune we spent raising the family no matter what we save by living as a couple!

 

[scrabbler1]

I live on about $22k a year. About 1/3 is housing, the maintenance charges (includes property taxes) for my co-op apartment and my small HO insurance policy. About 1/3 is health insurance and small dental expenses, the former continues to rise a lot. The rest is everything else, from income taxes to food to entertainment to utilities to car expenses.

Single, no kids, no debts, no mortgage (paid off in 1998). I come and go as I please, the same way as when I was working (P/T and F/T), except that I don't work any more!

 

[Alan]

Of course, even if we live to be 234, we'll never come close to making up for the fortune we spent raising the family no matter what we save by living as a couple!

You can say that again

We were talking about this over breakfast today. We are "cat sitting" at present in Austin while DW and SIL are away on vacation for their 30th birthdays. They have been married 9 years, doing very well financially and have no plans for children. This is not a financial decision on their part, they just love their freedom and they have also said that they won't have any more pets once the last cat pops its claws.

 

[Khan]

I voted 20-30K per year but my actual expenses are less than that and could be even lower if I didn't pay people to do house and yard work.

No spouse, no kids, no mortgage, small house on small lot...

 

[itsmyparty]

I voted the $60-$80 for 2 people, no debt, have pets. This year overall expenses will be more as we bought new vehicle($35,000), mine is a 07. Have always paid cash for cars. We live pretty simply (same house 26 yrs...no 'moving up', although could have). When DH retires fully at end of year (I retired 10 yrs ago), we're planning on spending alot more on vacations (currently at least 1 cruise and several "trips" a year)....no direct heirs to be concerned with...so plan on enjoying the fruits of our LBYM's efforts. We too are concerned about what health care will cost in future. Neither of us elgibile yet for medicare...but I've had no-cost premium coverage for both of us for about 8 yrs.....last year company I retired from started charging about $160/mo. for coverage for us both...and of course expected an increase this year. Was surprised that it's gone up to approx. $400/mo. for us both (includes dental and vision) for a PPO. Could choose the HMO option with no cost...but has alot of limits. So..this looks like it will be our major expense going forward. Frankly just feel lucky to have what we've got and plan on enjoying it! But both of us have, in our lifetimes, lived on a lot less and am sure we could again if we had to!!

 

[Independent]

If you look at the average for all two person families, and remove mortgage, RE taxes, rent, and health care, the result is just under $3,000 per month.

Here are the "official" averages for two person families according the the BLS

Age Group ----------------- 55-64 65-74
--------------------------- ----- -----
Food at home ---------------- 320 321
Food away from home ------- 257 198
Mrtg Int, RE Tax, Rent ------- 614 424
Other Housing --------------- 973 863
Clothing --------------------- 164 140
Transportation --------------- 874 747
Healthcare ------------------ 369 510
Entertainment --------------- 281 279
Personal care prod & svcs ------ 58 ,55
Alcohol / Tobacco -------------- 79 ,58
Reading / Education ------------ 88 ,43
Contributions ----------------- 259 213
Personal Insurance ------------- 49 ,49
Other ------------------------ 114 ,69
-------------------------------------
Total --------------------- 4,497 3,969

Net of Mrtg, RET, Rent,HC - 3,515 3,034

You didn't say if you were being criticized and disbelieved because people thought you were too high or too low.

 

[oneils]

I live on about 3100 a month or 37K a year. That is with 1520 a month (18K/yr) going to PITI. Points of clarification:

- I'm single
- have a small freehold townhouse
- have 10 years until the mortgage is paid off.
- I have no car
- Do not have to pay for health insurance premiums (I'm in Canada).
- I have about 20 years to go until retirement.

When the mortgage is payed, I could see my expenses dropping to about 2200 per month.

What problem do people have with your expenses? Are they in disbelief because they think are too low? Its as someone said above, it mainly comes down to "lifestyle and location."

 

[youbet]

I live on about 3100 a month or 37K a year.

What would you have to gross pre-tax up there in order to net the $37k you need to cover expenses? I'm assuming your source of funds is ordinary earned income.

 

[oneils]

What would you have to gross pre-tax up there in order to net the $37k you need to cover expenses? I'm assuming your source of funds is ordinary earned income.

Yes, my source of funds is ordinary earned income.

As a single who is under 65, and in my province, I would need about 49K pre-tax to earn 37 net.

Right now I earn more than 49k. I just did not include my savings as an "expense."

edit- if you are curious about Canadian taxes, you could check out this tax calculator: http://www.taxtips.ca/calculators/taxcalculator.htm

second edit: there is a calculator for Quebec on that site as well, but its not included in the calculator I linked to.

 

[jayc]

Maybe, but I think focusing on absolute basics may encourage people to aim short of their needs. I would not wish to ER with an income stream that was anywhere near "absolute basics." I think that is something that happens to you if you don't/can't plan, not something to aim for.

Where did I say to 'aim' and 'encourage people' because my basic costs are $1580/month. He asked what people live on. I like to know what it takes for me to be on this planet with no frills. I did not encourage anyone to live on more or less. I consider someone with an income stream able to cover their absolute basic expenses to be FI and well on the way to RE depending on lifestyle.

 

[tmm99]

Agree. I guess $40-60k for a single person with zero debt, or $60-80k for a couple with zero debt also is perfect.

I fit right in the range

 

[Rich_by_the_Bay]

Good poll, but whether you include income taxes (say, in the 15-20% range) and health insurance (in our cases $12K per year) can make a huge difference in your reply to the OP.

I would favor treating both as expenses which need to be included since that's what happens in the real world. Maybe the next version...

PS: the tax thing is especially confusing since once my post-tax money runs out, my withdrawals will go up some 20% just to cover income taxes on IRA distributions. Shortly thereafter, SS will start kicking in, etc.

 

[wanaberetiree]

Great feedback, thank you all!
I will need time to digest all of it, but it sound that I am not crazy

 

[NW-Bound]

If you don't mind my asking, how did you arrive at the desired 2.1% SWR? Is this an approximation of dividends and interest, or some other calculation?

Not at all.

The 2.1% SWR was simply from an article that was the subject of a recent gloom-and-doom thread here:

http://www.early-retirement.org/for...om-long-term-real-returns-of-2-1-a-52878.html

Being a naturally pessimistic guy, I thought I would lower my expectation so that I would not be disappointed.

Regarding a couple together not spending double that of a single person, I would think that is usually true. The house does not have to be double in square footage, and two can travel in an RV for the same fuel cost, etc...

But think about it some more, if I were by myself, I would just buy an empty lot in the mountain, then park a small motor home there and call it home. Would that not be cheaper? Being a recluse should bring even more savings that I have not thought of at the moment. No?

 

[NW-Bound]

I don't know if one is virtuous in being extremely frugal. But I know it is hard.

I also know there is absolutely no virtue in spending a lot of money. It takes no skills, and if there is, it is not too difficult to learn. We have seen lottery winners learning to blow away millions of dollars in just a few years. It cannot be that hard then.

 

[obgyn65]

Hello youbet - in my opinion the figures I gave are optimal with zero debt. It's ok to disagree, this is America. Take care.

Can't agree. DW and I definitely spend double what either would spend alone. How are you getting by on less than 2X your single budget as a couple?

 

[rescueme]

That's why she's still working, isn't she? Smart woman.

Yes. I could not afford her lifestyle (she just left for Cairo this afternoon, with her "travel buddy").

I'm at home, with the dogs (I'm not complaining )...

 

[youbet]

Yes, my source of funds is ordinary earned income.

As a single who is under 65, and in my province, I would need about 49K pre-tax to earn 37 net.

Right now I earn more than 49k. I just did not include my savings as an "expense."

edit- if you are curious about Canadian taxes, you could check out this tax calculator: TaxTips.ca - Canadian tax calculator

second edit: there is a calculator for Quebec on that site as well, but its not included in the calculator I linked to.

Thanks oneils!

 

[youbet]

Hello youbet - in my opinion the figures I gave are optimal with zero debt. It's ok to disagree, this is America. Take care.

Thanks obgyn65. BTW, I wasn't disagreeing with the amount you are spending, just with the concept that 2 can live for much less than 2X the expenses for 1. At least that's how it works at our house. Our "married couple" expenses run close to 2X what either of our single expenses would be.

Alan and I discussed on the last page. He pointed out some of the tricks he and his DW use to keep expenses down as a couple such as sharing a single car, splitting entrees at the restaurant, etc.

 

[obgyn65]

Thank you youbet.

Just to clarify, these are not the amounts I am spending (I am still working, in accumulation phase, planning to retire in 2012 at age 47). The numbers I gave are those which in my mind are optimal. The results from the survey above and the average numbers provided by Independent above fit the ranges. I guess my range may be higher when I retire since I spend a lot of money each year supporting free clinics in the US and in Central America.

Thank you to Alan and you for discussing a few tricks to keep expenses down. Very helpful.

Have a good weekend.

obgyn65

Thanks obgyn65. BTW, I wasn't disagreeing with the amount you are spending, just with the concept that 2 can live for much less than 2X the expenses for 1. At least that's how it works at our house. Our "married couple" expenses run close to 2X what either of our single expenses would be.

Alan and I discussed on the last page. He pointed out some of the tricks he and his DW use to keep expenses down as a couple such as sharing a single car, splitting entrees at the restaurant, etc.

 

[oneils]

Thanks oneils!

You're welcome, youbet!

This has been an interesting thread. After thinking about it, I think my expenses may be a little higher than 3100 as I have a few things automatically deducted from my pay. The deductions are: a monthly bus pass, a small "death benefit", a dental insurance premium, and a premium for extended health coverage.

I think those deductions total about 120 a month, bringing my total expenses to 3250.

 

[Sam]

This thread reminds of something I read a few months ago.

Quote:
Reasons I do not Brag About Room Prices

1. It tells readers they are stupid, and they paid too much.
2. My Mother does not want me to be a braggart.
3. Readers do not believe me.
4. I have this hidden fear, that if I told readers, they would come and fill up all the rooms and I would not be able to return. I know this is wrong, they just refuse to believe.
5. There is this USA cultural thing, that bragging about paying a lot of money makes you appear rich, prosperous and successful, so I have in the past shown pictures, but not always the price.
6. People try to shame me, try to make fun, try to insinuate I am cheap, I know I am the smart one, but it takes a lot of work to fend off the idiots.
...
End quote.

Source: Brag About Your 200 Dollars Per Month Room

 

[ksr]

Not at all.

The 2.1% SWR was simply from an article that was the subject of a recent gloom-and-doom thread here:

http://www.early-retirement.org/for...om-long-term-real-returns-of-2-1-a-52878.html

Being a naturally pessimistic guy, I thought I would lower my expectation so that I would not be disappointed.

Thanks for the info and the link. Interesting reading, although a bit depressing. I consider myself pretty conservative financially, and may have to ratchet down a bit my max of 3% WR.