Let's all get real about the #'s

[GTM]

Don't really want to beat this subject up but
I think we are all familair with the original $50 per day rule introduced to potential retirees by Paul and Vicki around 1988. (not really vaild anymore due to inflation).
Now remember that was supposed to be $50 a day for everything.

So if we take our current living situations and estimate a cash value to substitue for everything we currently have how much per day are we at.

Ok you have a paid off 2002 Toyota. How much per month would it cost if you had to make a payment on that car? in addition to all the other expenses associated with it it.

Nice home I'm sure so take the equity out and figure what a mortgage on that amount would cost per month. Try that with all you household belongings as well.

In addition to the other obvious living expenses like food, clothes, utilities, lets account for vacations, fee's to organizations, parking tickets, eyeglasses, medical insurance, co-pays and prescriptions, Dont forget new purchases such as when your computer goes etc etc.

Gifts on holidays and occassions. I'm sure nobody goes to a wedding with an empty envelope.

Just look at your bank and credit card statements and you will get a clearer view.

Now that $50 a day may be $87 a day today and I am sure alot of people live on $87 a day but my guess is not many on this board.

I say at least double that.

What do you think?

[retire@40]

And don't forget to gross up your expenditures to include income taxes.

And don't forget that $XX per day needs to be stated as a per person amount. A couple living under the same house gets to divide the fixed costs like the real estate taxes, while a single person must account for the entire amount.

[MRGALT2U]

We are a couple living on about $70 per day.
That's everything, including taxes. $50.00 per day
(for us) would still be doable.

JG

I think it's mostly inflation that is talking here. In the early 1960's a family of 4 could have a middle class lifetstyle on $10,000 per year. Of course a house cost about $15,000. - This would break down to about $27 per day.

I think if you took the average home price of about $200K - It is about 13 times higher than the 15K home in the early 60's. A salary of 13 times the 10K per year would be about 130K per year - Which today would be an average middle class lifestyle for a family of 4 (except the average salary is not 130K) - Yup! - The middle class is getting poorer!

130K would break down to about $350 a day. - So while this would seem like very high on hog, it is not that much, if you are just starting out with no assets. For a retired person with a paid for house with furniture and cars - $350 a day would be plenty!

[kat]

I can do $50 a day, but I have no debt and no large expenses. I'm not suggesting it's easy, and for a lot of people it's not feasible. No mortgage or car payment makes a huge difference, as you pointed out.

[unclemick]

Cut-Throat

Yah you right! Inflation - plus the tide of rising expectations. I'd get killed if I suggested going back to some the beater cars of yesteryear, doing without A/C or electric heat, getting rid of our electronic toys, cutting back on living space or some of my 'more creative frugal moves of the past.'

If I went back to $50/day - I'd be shot, or severly ostrasized, or institutionalized.

Now, if I were single again? Hmmm - nope, not going there.

"You are going to take it with you."

Poop! Heh, heh, heh.

[BigMoneyJim]

I was living on about $95/day including taxes during debt elimination. I believe that included a small car payment, and of course it included my rent and utilities. I'm spending more now, and I'm not sure if I'll go back to $95/day (or its inflation-adjusted equivalent) anytime soon.

EDIT at 10:20am: This $95/day number does not include health insurance because that's provided through my employer. In a retirement situation the health insurance would drive that number up quite a bit.

[MRGALT2U]

This "dead horse" is almost battered unrecognizable.
Still kind of fun though.

No mortgage or other debts
Very small house in the boonies
Newest vehicle is 8 years old
No cable, no cell phone.
Lots of clothing, furnishings, appliances were
bought used or picked up for free.
Everything is self insured to some extent.

You gotta put it in perspective. A lot of stuff that most
US citizens consider a necessity in 2005 were not available even
to the wealthy 100 years ago, and are not available
to most of humanity today.

I have posted my $50 per day budget before. We could still do it easily.

An aside. Did any of you read the new AARP magazine I posted about? People are living on just their SS check
and not bitching about it. They are way below $50 per day, but they found a way to make it work.

JG

[Jarhead*]

Cutthroat:

I told my wife just the other day, that if green fees kept going up, she was going to have to find a job.

[gayl]

This is similar to another post several months back. I too posted my budget at that time, and I also stated that $50 a day is not do-able for this single person. [thanks for the post re: fixed expenses such as prop tax / prop ins]

My current pension is 2092 per month before taxes... 8 for health/dental ins. Have additional income of around 7k and can only manage to save 3k per yr. Works out to spending almost 80 a day. And I have no car payments! If I had to cut back to 50 a day, I'd probably look for part-time work. Life is too short to scrimp that drastically

[kat]

I hear what you're saying, JG. My expenses (or lack of expenses) are very similar. Living inexpensively is so very easy for me, after finding it more enjoyable than having all the extras filling up my life. About six months ago I tackled one of the last issues: too many telephones. My office is in my house, so I had a business line, fax line, cell phone, and house phone. I cut back to one, sick and tired of all the taxes, and found it to be the right decision. And cable never interested me, so I dropped it a long time ago. Air conditioning where I live is handled well by some tall trees. My favorite activity is hiking in the mountains nearby. I love to spend money on travel, and I have the money available.

But I've never felt inclined to criticize anybody who spends their money differently and chooses or must find other ways to go. I had (and still have) some terrific teachers -- my parents -- and that's an asset that's hard to match. They gave me good instincts.

kate

Quote:

Cutthroat: I told my wife just the other day, that if green fees kept going up, she was going to have to find a job.

Now this is Hilarious!

[MRGALT2U]

Hi gayl! Because life is so short is probably the main reason we would be willing to "scrimp that drastically".
It's all about time. OTOH, we don't really see it as
"scrimping". We prefer to say cutting back, or downsizing. I do understand why not many would do it.

Just think, I made between a million and a million five while I was
working and now I'm willing (if necessary) to live
on (pick a number...........$50 a day or less?) just so I will
never have to work again. Plus, a lot of my working life
was not all that unpleasant. Interesting........

Right now I am going to walk my dog through a state forest.
Won't cost a dime other than the gas to get there.

JG

[unclemick]

Then of course:

There are those really, really cheap SOB's who get their jolley's off on frugal. Not to mention any names of course.

A cruise, European vacation, Bahamas,Mexico, dining out in four star restaurants - was required once in a while to keep the peace and balance out shutting off the electricity and other more estoric experiments.

I don't think part time work as a suggestion to pay for the A/C would be benefcial to my health.

Greens fees would be safe since I don't golf.

Good one.

[JonnyM]

There is always a car payment. I don't get the calc's that characterize a "paid-off" car as no car payment. One can't plan based on a car having no maint cost, and no replacement cost. You have to pay the piper.

[ordway]

I'm sure I could probably spend $200/day, but I'd have to work at it.

My husband and I live on about $25k-35k (higher end now that we're in a pricier area) without counting taxes. Add in taxes on *that* amount (no fair adding in the expense of taxes on the 60% of our income that we're saving) and toss in another few grand to make up for the health insurance that's partly paid through the job, and maybe we'd get up to $45k or so. That's still just $123/day for both, or $61 per person per day.

Last I checked, I wasn't living in a hut (a nice condo a block from the beach, actually) or depriving myself of fun things. My husband just bought a cool new digital camera, for instance, and we're taking a weekend trip to Las Vegas in a couple of weeks. (I'm in a big fencing tournament. Wish me luck!)

I'm not sure I'd even know how to spend $350/day, on things I actually enjoyed!

[Blackhills_Bob]

The two of us are spending 30 dollars a day. So it is possible. We put $1700 a month in the account and pretty much spend it down. This is with three cars, horses, satalite TV, health insurance, and internet, and various motorized toys.
Vacations on this budget are pretty much a lost cause. But we live in a vacation paradise so there is not much need to leave. We don't eat in restaurants much but party all the time with the neighbors.
For us, having control of our lives is more important than having new stuff. We have tons of stuff, its just not new.
Two years ago we had high paying jobs, Mc Mansion, luxury cars ect. But the jobs were killiing us.
I would not trade the freedom for any big ticket item.
Reducing spending will get you part way there. But the big item is reducing taxes and insurance. Our little farm house has low taxes, income tax should be zip, and liability on old cars is reasonable in the country.
Having all the free time allows you to take up interesting hobbies like roofing, plumbing, fencing, shed building, wood cutting, salvaging, and shoveling manure.

[preben]

Ah the eternal question; how much is enuff!?

For a single guy living in Bangkok $1000/mth is ok (1 bed room apt/travel in area), $2000/mth (includes nice apt/travel) is good and $3000/mth is VERY good (bring on the dancing girls!).

Health insurance is cheap - even for the global cover ones.

So; $3k/mth; fine by me!

[gayl]

Quote:

The two of us are spending 30 dollars a day. *So it is possible. * We put $1700 a month in the account and pretty much spend it down.

That 1700 per month after taxes works out to be 56 a day, not 30. And many fixed expenses are the same for one and two [internet / utilities / housing]

I live in the SF Bay Area, close to the Napa Valley wineries and walking distance to a state preserve and national park .... yet I still feel the need to take several long trips per year [inc 2 cruises], Starbucks on Mondays and Thursdays with one set of friends, long lunches each Monday with my sisters on 1825 after taxes, 7k each Nov 10th for prop ins / taxes / next years travel money. So I am frugal .... just not that frugal.

[MRGALT2U]

It's kind of interesting to consider how easily I slipped
back away from the frugal ER life after I went back to work FT in 1994. I had been semiretired for less than a year, but still................as soon as I was drawing a
paycheck again, I bought a Cadillac Seville and rented
an apartment in the priciest complex in the Dallas area.
It was not until I hung it up for good that serious
spending cuts were implemented. Thus, I never
did use LBYM until I had actually retired. Pretty lucky that
I was able to pull it off at all.

JG