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Margin of error for expense
Old 04-25-2006, 10:54 AM   #1
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Margin of error for expense

Good morning all,

One of the critical component in the ER equation is the annual desired expense.* In my calculation, I make sure that everything is included.* After arriving at the final number, I couldn't help but to add 15% to it.* I scorn myself repeatedly for doing it, but am unable to remove that safety margin.

Do you have that problem?

Sam
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Re: Margin of error for expense
Old 04-25-2006, 11:14 AM   #2
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Re: Margin of error for expense

The spreadsheet I use has in the budget area a place for misc. expense/gifts. I run the sheet with all the other expenses at what I think they will be, and the e/g category there also. Then I will start playing with that category and the ‘one time expense’ category and see how high I can get these before I run out of money at give stock returns and inflation numbers. It gives me a warm feeling so far. That is if the spreadsheet is right.
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Re: Margin of error for expense
Old 04-25-2006, 01:51 PM   #3
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Re: Margin of error for expense

i pad each expense and then round up. then i pad the total and round that up as well. lastly i add vacation/emergency budget onto that. hardly scientific but easier for me to sleep.

i'm happy to report since re i've stayed well within my budget without even trying.
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Re: Margin of error for expense
Old 04-25-2006, 07:38 PM   #4
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Re: Margin of error for expense

Quote:
Originally Posted by lazygood4nothinbum
i'm happy to report since re i've stayed well within my budget without even trying.
Is that budget padded or not?

Sam
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Re: Margin of error for expense
Old 04-25-2006, 07:57 PM   #5
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Re: Margin of error for expense

Quote:
Originally Posted by Sam
Is that budget padded or not?
hehehe. there is so much padded room in that budget, i could bounce off the walls for weeks and never bump my head. and i'm pretty sure i already have.
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