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Re: What do you tell people you do?
Old 01-17-2004, 06:26 PM   #21
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Re: What do you tell people you do?

John,
Perhaps you can help? I am interested to taking an informal poll here regarding how much one spent last year excluding a house payment or car payments if they have them...couples or singles...

Not sure if a new link needs to be created? but I am on the move alot and cannot always get online, so I thought you might be able to help...

"I'll tell you mine if you tell me yours"

suggestions?

thanks Billy
Web-site http://www.geocities.com/ba264

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Re: What do you tell people you do?
Old 01-18-2004, 03:00 AM   #22
 
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Re: What do you tell people you do?

Hello Billy and friends. Re. Billy's question
(what we spent last year), that requires guessing as
we have no budget. But, we also have no house
payments, car payments, or other debt. Assuming
we spent 100% of our income (a pretty safe bet),
then we (a couple) spent about $24,000 pretax.
But, this includes some unusual non-recurring items,
so a "normal" year could be significantly lower. On the
other hand, I'm not sure we ever have a "normal" year.

John Galt
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Re: What do you tell people you do?
Old 01-18-2004, 05:05 AM   #23
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Re: What do you tell people you do?

Thanks John...
We too spent about 24K...and have for the past three years plus or minus a little....also, we do not have a budget...but do monitor spending using "money".

thanks I am interested in hearing from others..

Billy
Web site http://www.geocities.com/ba264
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Re: What do you tell people you do?
Old 01-18-2004, 05:13 AM   #24
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Re: What do you tell people you do?

This is interesting. I have several budgets I've made for when I do retire, and 24K is my "magic" number. It is enough money to have fun, but not so much that one needs a massive (read 2+ Million) stash to generate the income.

Does the 24K figure for those who have answered also include health insurance costs ?

panhead
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Re: What do you tell people you do?
Old 01-18-2004, 05:59 AM   #25
 
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Re: What do you tell people you do?

Our 24K covers everything including health insurance
but excluding house, car and debt payments as we have
none. In our case and at this time, 24K is plenty.
I expect others would find it onerous, especially if
they are used to living as I once did. I enjoyed my former
(big spender) lifestyle but suffered no angst
making the switch. I am struck by how many posters
on this site are dedicated savers/investors at a relatively early age. Good for
them! I didn't do it but it worked out anyway.

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Re: What do you tell people you do?
Old 01-18-2004, 10:32 AM   #26
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Re: What do you tell people you do?

I just re-ran my budget for the last two years.

My fixed costs including food, gas, utilities, health care, and all miscellaneous expenses rounds up to about $18k. No debt, so no home or car payments included. My "discretionary spending" for the last two years ran to about 6k per year excluding some one-time expenses (like an engagement ring...I sure as heck hope THATS a one time thing...).

I've shaved that 18k down to the point where I doubt I could reduce my base costs any further. If I moved into a smaller easier to heat/cool house, dropped cable tv and internet access, sold my car and bought an old one that I only took minimal insurance on, and ate a lot of pasta I might shave about $2.5-3k off of it. Not worth it.

Considering that up until 3 years ago I made six figures every year and spent most of the salary, this represents quite a lifestyle change, of which I dont miss a thing.

I'm tracking to cut that "discretionary spending" roughly in half this year. Pretty much just thinking 3 times before buying any non-essentials.

Seems to be something magical about that $24k number...
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Re: What do you tell people you do?
Old 01-18-2004, 10:49 AM   #27
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Re: What do you tell people you do?

Wow, are you guys including taxes in your expenses? My taxes alone exceed your "magic number".
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Re: What do you tell people you do?
Old 01-18-2004, 01:58 PM   #28
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Re: What do you tell people you do?

Quote:
Wow, are you guys including taxes in your expenses? *My taxes alone exceed your "magic number".
ONe of my prime reasons for ER'ing as early as I did was because I was tired of paying so much in taxes. I live now on a fraction of what I used to pay in taxes each year...and because I have a large family(lots of deductions running around), I don't owe any federal taxes any more and almost no state(maybe even zero this year). It is a nice feeling. No debt and no taxes, other than property taxes(which I haven't figure out how to get out of).

Almost every penny of money of I make goes into my pocket, not the governments....and I do everything I can to make sure it stays that way...all legally.
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Re: What do you tell people you do?
Old 01-18-2004, 02:52 PM   #29
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Re: What do you tell people you do?

Just did a Quicken analysis for 2003. Here's my spending by category. I left out medical expenses since I'm still employed and my employer pays most. I paid $3,008.34 for premiums and $800 out of pocket. Were it not for the employment, my medical expenses would probably be about $15,000 - $18,000. We own the house, two cars, and have no debts. This is a husband, wife, and two kids still at home. Here's the breakdown:

Expenses:

APPLIANCES-------------------------------113.08
CABLE TV-----------------------------------374.25
CAR REPAIR/PURCHASE -----------------516.75
CAR INSURANCE---------------------------915.00
CAR LISCENSE-----------------------------234.00
CHARITY----------------------------------1,033.00
CHRISTMAS GIFTS-------------------------668.92
COLLEGE (APPLICATION FEES)---------100.00
CLOTHING-----------------------------------872.65
DENTAL--------------------------------------362.17
FOOD--------------------------------------4,999.49
GENERAL\MISC--------------------------6,460.85
HOUSE INSURANCE-----------------------379.00
HOME MAINTENANCE-------------------3,080.82
INTERNET-----------------------------------551.40
LIFE INSURANCE ($100,000 each)-----311.00
NATURAL GAS (HEAT)---------------------917.30
PHONE--------------------------------------301.43
PROPERTY TAXES---------------------------939.00
UTILITIES (elect, water, garbage)----1,940.39
TRIP TO LAS VEGAS----------------------1,518.89

TOTAL EXPENSES BEFORE TAX------26,589.39

TAX (FICA, FEDERAL, AND STATE)---7300.00
(Most of this is FICA which I won't have in ER. I haven't done the state return yet, but this is close. I'll pay only $1,086 federal tax.)

TOTAL EXPENSES AFTER TAX--------33,889.39
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Re: What do you tell people you do?
Old 01-18-2004, 06:39 PM   #30
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Re: What do you tell people you do?

Hmm, that is a magic number. I'm not retired but I spent $24759 last year. That excludes the mortgage and car note, but does include property taxes and all insurance. It also includes three vacations, one of which was a worthwhile but expensive boondoggle.
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Re: What do you tell people you do?
Old 01-18-2004, 10:18 PM   #31
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Re: What do you tell people you do?

hmmm, I knew we were not pinching pennies, or even counting them, but our expenses are a bit higher. Now we have me, wife, 2 teenage girls, and one younger boy; not that much more than Bob Smith. If I exclude the mortgage, which is paid by our real estate investment income, we spend just about $50k. Car insurance alone is $1800 with a teenage driver. Some expenses I know are double or triple Bob Smiths - Property taxes are triple, and other housing items are about double. I know we have a big house, and that is a luxury;I would peg about $10k to $15k of the difference to housing related expenses. I think for just me and my wife, in a smaller house, $30k a year wouldn't be a problem; maybe even less.

Budget expense may be relative also. I have almost always saved 25% of my gross salary, and as it went up both the savings and spendable part went up. Although we are thrifty compared to some of our friends, we aren't compared to some of the people on this board.

Wayne
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Re: What do you tell people you do?
Old 01-19-2004, 03:37 AM   #32
 
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Re: What do you tell people you do?

In addition to no debt, we have almost no income taxes
to pay. Truly, at this time the 24K income (for 2) is easy
for us.

John Galt
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Re: What do you tell people you do?
Old 01-19-2004, 07:06 AM   #33
 
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Re: What do you tell people you do?

Hello Jarhead. Yeah, I thought that "easy" remark would yield some comment.

Nope, no mutimillionaire here. I do have a survivalist
streak, but living on the 24K truly is easy for us. Look at it this way. I am convinced we could scrape by on
$50.00 per day ($18,150 yr.) So, 24K gives us a $6,000
cushion. But, we buy used/cheap whenever we can and shop like crazy for everything else. We sell off
anything that is just laying around and I add to this by
buying and selling odds and ends when I know I can
make a buck. This is not included in the 24K, but I never
"work" at it and it does not add a lot to our available
cash. We dial down the heat in the winter, go without
air conditioning until we get uncomfortable, do a lot of fishing (supplements the groceries), buy cheap wine,
forgo cable, new books, new magazines, movies at the theater, and don't go
nuts on gifts at Christmas, birthdays, etc. Personally
I'd rather get something inexpensive that I could
actually use. We live in a low cost part of the state
which helps. And, we only have ourselves to worry about (plus 4 dogs). We have insurance but take
the minimum with high deductibles on everything.
We have 2 vehicles, 12 and 7 years old. I would guess
90% of household furnishings/appliances are used, from flea markets, auctions and garage sales. Sooooooooooo,
yes it is easy for us, but we're almost on ER autopilot.

John Galt
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Re: What do you tell people you do?
Old 01-19-2004, 10:41 AM   #34
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Re: What do you tell people you do?

Hi Wayne,

We live in a three bedroom, one-bathroom home that we paid $40,000 for 21 years ago. It would sell for around $80,000 today. That has helped to keep our expenses down.

We live in a small town of about 7000 and property taxes are low relative to most locations. There is no crime here to speak of - it's very much like it was in the 50's. The schools are good. I can get to work in 5 minutes - there is no traffic. On the downside, we have cold winters and there isn't much to do for those who enjoy the things a city can provide. And there isn't much natural beauty here. No mountains, few lakes, no ocean - just fields.

The median wage here is $10.12 per hour. So there are many families who are getting by on $24,000 per year, and someone making that wouldn't feel poor here, and they would be viewed as living an average lifestyle.
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Re: What do you tell people you do?
Old 01-19-2004, 05:27 PM   #35
 
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Re: What do you tell people you do?

Hey Bob_Smith..............your situation sounds very similar to ours (size of town, little traffic, 50s atmosphere, good schools, weather,
etc.). We do have outstanding scenery here and lots of water though. Plus, we are 90 miles from Chicago,
although I never ever go there. Not for any reason.

John Galt
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Re: What do you tell people you do?
Old 01-19-2004, 05:48 PM   #36
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Re: What do you tell people you do?

Thanks to all that have posted...

It would be great to have more feedback. Anyone else interested?

Thanks, Billy
Web-site http://www.geocities.com/ba264
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Re: What do you tell people you do?
Old 01-19-2004, 08:02 PM   #37
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Re: What do you tell people you do?

I retired last year (April 2003) and my wife did not retire for a couple more months. No kids. Not counting income taxes, we spent $47K. Although our spending varies significantly from year to year, that is as close to a typical number as I have seen. Over the past 6 years our spending has ran from a low of $38K to a high of $66K. Taxes always at least double that number (but not after this year) .

Our spending is dropping in retirement. Since retirement, we are spending at a $36K annual rate. That is far below the $64K budget I anticipated in my planning.
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Re: What do you tell people you do?
Old 01-20-2004, 12:04 AM   #38
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Re: What do you tell people you do?

Hello,
I'm a new poster. Retired at age 53 a year ago. When people ask me what I do I say "Whatever I want!". It brings a smile to most faces.
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Re: What do you tell people you do?
Old 01-20-2004, 04:42 AM   #39
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Re: What do you tell people you do?

Since I took a separation package last November and have not returned to work, I tell people that I'm semi-retired and am looking forward to dropping the semi. I'm not sure that full ER will be possible for me at my present age of 54.5, so may do some consulting/part-time work for the next 5 years, while gradually trying to cut costs.

My expenses are embarrising compared to most on the board, running about $82K, with me, wife, two kids, dog, two cats and a big house and two college tuitions on the horizon. If I could pare expenses down to about $50K, I would be much more comfortable with totally pulling the ER trigger now, but as it stands, I plan to continue to do something so that we can stay in our current home until my daughter graduates high school in another 5 yr. We live in North Texas and between property taxes and insurance, cost cutting isn't easy without downsizing.

Doug
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Re: What do you tell people you do?
Old 01-20-2004, 05:16 AM   #40
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Re: What do you tell people you do?

We had it cranked down to around 18k/yr - 93 to 98 wherein I took my early pension at age 55 and promptly lost any budget discipline - don't keep track anymore but probably running mid to high twenties with eat out/take out, remodeling, entertaining visiting relatives, etc. accounting for the upward drift along with putting some more money in my 'hobby stocks'. Three(me,girlfriend,widowed mom).
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