I include everything in my spending amount . Mainly because I am afraid to cross over that 4% mark so I include taxes ,remodeling and large expenses . I now see a lot of people do not do it that way so I concede that my way while rigid works for me but it's not for everyone .
I swear that this year I'll
really track all my spending...
It's complicated, and especially so because I'm lazy, and because I'm still slogging to the mines every day. I track all the major expenses - PITI (or is that PITA?), utilities (including water, sewer, refuse collection, cable, internet, mobile), auto fuel and insurance, med/dental insurance, haircuts, toll tag charges... I started tracking groceries last year, but fell off the wagon early. I do know that I spend around $25/wk on groceries, with 2-3 major Costco runs a year to stock up on meat, coffee, and such, that run around $150 apiece. This doesn't include a fair number of restaurant meals...
Also, started tracking med/dental expenses, but fell off that wagon too... I have the info, just haven't compiled it.
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...
Given what I make, and what I spend, while not precise by any means, I get a good feel for how much I need to FIRE. And, as I do now, if the bills are paid, including rainy day/new roof/new car slush funds, then all other money can be spent partying and/or traveling. Considering that a large chunk of current income is funding savings and retirement accounts, which I do not consider "expenses", if I can come close to the same income in retirement as I make w*rking, I should be golden.
Such is my rationalization for not tracking spending to the penny...