Is this Amount of Income Enough to Retire Early On?

[plex]

My grandfather did the same thing exact thing Oldtrig, but a word of warning, be careful with ladders. My grandfather fell off a ladder in his late 70s once, but was fine. He kept climbing ladders. Shortly after, he fell off a ladder, again, fine. He kept climbing ladders. He fell off a ladder again, he wasn't so fine after that.

 

[79protons]

People don't realize there is so much of the world out there that is free or low cost (parks, libraries, museums, etc.) because they are too busy in their expensive virtual world tweeting about the latest video of a housecat wearing a tutu on their $200 a month plan Iphone, usually while driving their nearly new latest "green" car in stop-and-go traffic to get to their job so they can make enough cash to stay in the virtual world.

Is big city life really THAT entertaining?

 

[haha]

Martha, I plan on working everyday at the shop I own. I can weld, work on small engines and believe it or not I taught myself 12 years ago to repair and network computers. I worked in this shop for almost 30 years before I give it up 14 years ago to take the job I have now.

When I lived in farm country I had an old buddy who retired from a career as a career farm welder/iron worker. He would sometimes work 20 hour days for weeks, repairing broken down pea viners in the field.

When he retired he was able to get an old milling machine and some precision saws and do just about anything involving iron in his farm shop. He was never bored, because in a rural area there are plenty people who have stuff to be repaired or made for a decent price. He made me a great spit to barbecue whole sheep and a whole lot of other things. I was in awe of his skill and resourcefulness.

This kind of retirement beats a lot of other possibilities.

Ha

 

[haha]

People don't realize there is so much of the world out there that is free or low cost (parks, libraries, museums, etc.) because they are too busy in their expensive virtual world tweeting about the latest video of a housecat wearing a tutu on their $200 a month plan Iphone, usually while driving their nearly new latest "green" car in stop-and-go traffic to get to their job so they can make enough cash to stay in the virtual world.

Is big city life really THAT entertaining?

Well not to disagree with your thesis, but usually

(parks, libraries, museums, etc.)

are found in big cities. And the best ones, in the biggest cities.

Ha

 

[NW-Bound]

Is big city life really THAT entertaining?

My main house is in the suburb of a metropolitan area with more than 4 million people. We have not been to the movie theater in perhaps 3 years. We have not set foot in a shopping mall in longer than that. My other place is in the boonies, where I have to drive 30 mi to get groceries. Up there, I miss a "real" library, choices of grocery stores like Trader Joe's and Fresh-n-Easy.

I have not lived in my boonies home for several months at a time to see if I would get bored. I would get Internet though, to get a window into the world. Else, there may be a pandemic flu wiping out half the world population and I might not know. I would also want to make sure I would not get bored. It is already bad if one feels the need to hit the bottle, but growing one's own ingredient for "cookies" for self-entertainment (special cookies that I just learned about in another thread) would be something I definitely want to avoid.

But living in the center of a really big city is never my cup of tea. When visiting Manhattan, I thought to myself that they would need to pay me really big bucks to live there, leave alone for me having to pay more than $1M or $2M for a little condo.

 

[oldtrig]

You know I will probably keep the internet. I was typing without thinking when I typed that one. How would I fix someones computer if I did not have internet The phone and TV I can do without. Someone please tell me what is on TV that is fit to watch anyway??
I made a promise to myself years ago that when I got older I would help people for nothing in return. I cannot stand to see young business people take advantage of older people. I also understand quite well there are also older people that will beat you out of things so I watch real careful who I am dealing with. Being self employed for 20 years in my early life taught me a lot about that.
I live in a rural area and could not even think about big city life. Things here move at a much slower pace and I like that.
oldtrig

 

[veremchuka]

seems to me a phone is more than a luxury. how do people reach you, they must drive over. and what if you are injured and need help? i'd keep the phone too.

as far as tv to each his own. i never was a big tv watcher but there are some very good programs on however you'd need cable or satellite tv to get those channels. the crap on abc, cbs, nbc, fox entertainment and many of the cable/satellite channels is trash, that i'd agree with. however, history, discovery, national geographic, nat geo wild, animal planet, sometimes amc or tcm for movies, fnc for news, science channel, these are my favorites. the vast amount of interesting and informative and educational shows i watch on these channels are something i'd never give up. i've learned so many things i never would have had exposure to that i just can't understand how someone can say they would not be interested in this programming but then some are transfixed on sports and i'd rather drag my finger nails on a blackboard than watch that. to each his own.

2011 will be the year i live without a mortgage payment (paid it off this year) so by this time next year i'll really see what i live on. i may be surprised but i can't see me living on $20k and i lbmn, well below and i'm in a rural area but a very expensive part of the country.

 

[aaronc879]

2011 will be the year i live without a mortgage payment (paid it off this year) so by this time next year i'll really see what i live on.

Same here. I was planning to have a budget of $800/mo or $9600/yr but I decided to keep it the same as it was this year: $1000/mo or $12000/yr. That will allow me to take a nice vacation to Florida and maybe up my entertainment spending a little. Without the Florida trip i'm sure I could stay under $10K/yr but i've earned that trip. It'll be the first real vacation in my adult life after about 12 years of full time work.

 

[NW-Bound]

You've sure earned that trip. Enjoy it. But be aware that leisure can be addictive.

 

[oldtrig]

My only option at my shop would be a business phone because it was a business in the past. Way to much money to pay for something I could do without. Cell phone service is awful there so thats out. To many of my friends calling me and wasting my time is another reason. Sometimes people who are already retired call me because they are bored. That will soon stop.
At my home I might just put up an antenna. Like I said there is not much worth watching anyway. I can always pop in a DVD if I want to watch something. It will be free. I am tired of watching politics, problems around the world and in general anything that is negative. There is nothing I can do about any of those things anyway.
Heck, if I could write I could write a book on how to live in the US for $20,000 a year. It would not be something someone could do all of a sudden. It would take several years of planning. Everything would have to fall in place as planned.
My wife and I have saved for 40 years where we can do this. I have no doubt in my mind about it.

 

[aaronc879]

You've sure earned that trip. Enjoy it. But be aware that leisure can be addictive.

I'm sure it is. If I continue to keep my current j*b, then I will likely escape to Florida for a week or 2 every winter from now on. I won't have enough time off to do much additional leisure.

 

[kyounge1956]

I sure would like to see a line item budget from some of you folks who live or are planning to live on $20K a year or under. Maxing out my retirement accounts the last couple of years has resulted in a spendable income approximately the same as my pension would be if I were already retired. It's over $30K/year and feels uncomfortably tight. I can only think of three things in my current budget that will be reduced or go away altogether after retirement—P & I on my mortgage, buying lunch at work and charity (I tithe, and 1/10 of my pension will be less than 1/10 of my salary). But even taking these decreases into account, I am still well above $20K, and that's not allowing for the fact that at least some of these decreases will be offset by increases in health insurance and some other costs.

I am not a huge spender, or at least I've never thought of myself as one. I don't wear designer clothes or drink lattes. I don't have cable TV, a cell phone, or an expensive hobby like golf. I don't commute long distance, dine out frequently, travel extensively, buy a new car every 3 years, or leave my windows open during the winter. In spite of all these abstemious habits, my bare-bones budget is between 1/4 and 1/3 more than you uber-frugal types say is ample for your needs.

How do you guys do it? What are you leaving out of your budget that I'm keeping in mine? Or is the extra 25-30% just the price I pay to live here in the NW?

 

[79protons]

How do you guys do it? What are you leaving out of your budget that I'm keeping in mine? Or is the extra 25-30% just the price I pay to live here in the NW?

Bingo. The NW is about 20% to 30% higher cost of living than the cheapest places (like the deep south). Add to that the 10% you tithe (I worship at the house of me), and there you go.

But I don't think anyone feels that living on 20K a year wouldn't be tight...but it is probably doable in the right area, especially with subsiized health care.

 

[kyounge1956]

Bingo. The NW is about 20% to 30% higher cost of living than the cheapest places (like the deep south). Add to that the 10% you tithe (I worship at the house of me), and there you go.

But I don't think anyone feels that living on 20K a year wouldn't be tight...but it is probably doable in the right area, especially with subsiized health care.

Is living in an inexpensive part of the country pretty much the whole secret of the sub-$20K budget? Too bad for me if it is, because I don't know of anywhere else I'd want to live. If push comes to shove, I guess I am willing to pay extra to live in WA.

 

[aaronc879]

I sure would like to see a line item budget from some of you folks who live or are planning to live on $20K a year or under.

2011 Annual expenses
property taxes: 75/mo
condo insurance: 12/mo
car reg./AAA: 13/mo
　
2011 budget
annual expenses:100/mo
electric: 100/mo
condo fee/maint,: 125/mo
cable/internet/phone:175/mo
Car-gas/maint/ins.: 125/mo
groceries: 225/mo
enter./misc.:150/mo

Total: 1000/mo

I will come in at just under $1000/mo average in 2010 even with paying a mortgage for half the year. I rounded up on many of these and will almost certainly come in under $1000/mo average even with a planned 2 1/2 week vacation to Florida in February.

 

[kyounge1956]

2011 Annual expenses
property taxes: 75/mo
condo insurance: 12/mo
car reg./AAA: 13/mo
　
2011 budget
annual expenses:100/mo
electric: 100/mo
condo fee/maint,: 125/mo
cable/internet/phone:175/mo
Car-gas/maint/ins.: 125/mo
groceries: 225/mo
enter./misc.:150/mo

Total: 1000/mo

I will come in at just under $1000/mo average in 2010 even with paying a mortgage for half the year. I rounded up on many of these and will almost certainly come in under $1000/mo average even with a planned 2 1/2 week vacation to Florida in February.

oooh, thanks!!

Right off I am seeing two more items in my budget that aren't 1n yours: gifts & pet expenses, but I don't spend enough on these to explain the whole difference. In the event of really tight finances, I'd eliminate the gifts, but I just have to have a cat! I'll have to look at this more closely later on.

added later: do you have a pot of money that you set aside for replacing your car and other large infrequent expenses? What are "annual" expenses (first line under "2011 Budget"?

 

[52andout]

additional expenses we have looking at our last few years of tracking expenses

medical: insurance and co-pays over $6000
insurances: auto and house much higher
property tax: much higher
travel: visits to kids, grandkids and MIL- overseas every few years and national park visit on off years.
gifts: we help fund 529's for grandchildren and also give gifts to kids for Christmas/Birthdays
hobbies: yearly quilt show trip, sewing stuff, tuition at Wooden boat school in Maine, expanded rose bed last year etc.
house maintenance: replace and repair of various things averages several hundred a month
charity: gifts to library, fire department, boy scouts and other local charities we believe in.
auto: several hundred each month goes into a repair/replace fund

 

[FUEGO]

Here is a copy/paste from my expense tracking spreadsheet. Comments below the line items.

2. House - repairs/maintenance (incl. appliances/repairs) 98
3. House - insurance/taxes 81
4. Utilities-Gas/Electric 137
5. Utilities-Water/Sewer/Trash 66
6. Utilities-Cable TV 0
7. Home Furnishings/ Furniture 0
8. Communications - Phone/Cell Phone/Internet 56
9. Auto-maintenance/insurance/taxes/license/regis. 113
10. Auto-gas 150
11. Medical/Dental 25
12. Clothing 63
13. Groceries/Household (Walmart, Target, Grocery Store) 484
14. Student Loan Payments
15. Education/Training/Prof Fees
16. Childcare/Afterschool care
17. Dining out 70
18. Entertainment/Toys/Fun (incl. ABC store) 57
19. Vacations
20. Electronics 101
21. Gifts 79
22. Charity 0
23. Misc. 5
24. Cash 1

total: $1586/mo or $19,035/yr

Mortgage expense was excluded, as was student loans, childcare, education, and vacations. For me, the above spending reflects my average monthly bare bones core expenses I want to have no doubt of being able to fund during FIRE. This is our actual data from the six month period of April-September 2010. I'm at work so I don't have the updated expense tracking spreadsheet through Dec 1 2010, but I can tell you our expenses have crept up to an annual rate of $20,600 for the first 8 months of tracking (large med/dental expenses are probably the culprit). There is also no reserve fund for car replacement, so that could be another $1000-3000 a year. This is for a family of 4 in a city in the southeast US.

 

[haha]

I have pretty well given up benchmarking my expenses against the more frugal memebers here. For example, I think I spent more than $250/mo on food 40 years ago just out of school.

For me at least, I am far from the point where the pleasure vs. spending line flattens out.

I totally understand doing whatever one has to do to make lemonade out of lemons, but I equally do not understand electing that pathway if others are available.

It is somewhat different with a young family. Kids are all the entertainment you need, and if you can keep down family expenses you can live fairly cheaply and still have fun, at least until they want ski-ing lessons, riding lessons, music lessons, soccer fees, Tai-Kwan Do ....

And then, if you find yourself alone you may well want more activity.

I do think it is possible that some do not understand what their lives really cost. For example, under modern standards of pet care, the life cycle cost of anything more than a goldfish or perhaps a guinea pig can be huge.

Ha

 

[bamsphd]

I do think it is possible that some do not understand what their lives really cost. For example, under modern standards of pet care, the life cycle cost of anything more than a goldfish or perhaps a guinea pig can be huge.

Amen. The dear wife spent $1k+ today to have one of our cats teeth cleaned, which is a recurring expense for all four cats and the dog, despite our brushing their teeth twice a day! I'm still amazed at how much pet care standards have changed. Nowadays, medically our cats and dog get almost the same standard of care as a human child.

If I didn't have to cover medical expenses for me, my wife, our dog and our cats, I would probably be able to retire today.

 

[REWahoo]

Amen. The dear wife spent $1k+ today to have one of our cats teeth cleaned, which is a recurring expense for all four cats and the dog, despite our brushing their teeth twice a day!

 

[veremchuka]

1, one, a single, cat. teeth cleaned @ $1000?

i never heard of cleaning a cat's teeth. that is a very large sum of money that if it was 1 time every 10 years i'd still question it but something tells me it is a lot more frequent than that.

 

[M Paquette]

i never heard of cleaning a cat's teeth. that is a very large sum of money that if it was 1 time every 10 years i'd still question it but something tells me it is a lot more frequent than that.

Brushing a cat's teeth isn't so bad. Getting them to floss, though...

(Disclaimer: I've never had dental problems with my cats. They're on a higher quality dry food, which may help.)

 

[SecondCor521]

I sure would like to see a line item budget from some of you folks who live or are planning to live on $20K a year or under.

...

How do you guys do it? What are you leaving out of your budget that I'm keeping in mine? Or is the extra 25-30% just the price I pay to live here in the NW?

Food $ 338.14

Insurance $ 327.87

Utilities $ 224.22

House $ 181.66

Auto $ 111.32

Tax $ 91.74

Recreation $ 73.52

Medical $ 27.45

Clothing $ 21.00

Misc $ 5.87





Month total
$ 1,402.81





Annual
$ 16,833.68


The above is a pro-forma monthly budget for me on 3/7/2014 based on my actual living expenses in Quicken the last six months. Fundamentally it is how I live now adjusted for things I know will increase/decrease in retirement, then adjusted for my mortgage and child support (for which I set aside separate sinking funds), then increased by my estimate for inflation. The above assumes living in my typical suburbia house in Boise.

It's pretty realistic, except where it isn't. I do believe in a pinch that what I have above is "do-able" for me personally. My plan is to continue working until I hit a 4% S(?!?)WR then take a more realistic look at things. Who knows, I still have some other thoughts and plans that if I follow them would result in a completely different lifestyle and budget.

No pets, no alcohol, no tithing (yeah, maybe I should change my user name), no spouse, no expensive hobbies, budding minimalist. Above budget specifically does not include sinking funds for car replacement and long term house maintenance, though.

2Cor521

 

[kyounge1956]

Amen. The dear wife spent $1k+ today to have one of our cats teeth cleaned, which is a recurring expense for all four cats and the dog, despite our brushing their teeth twice a day! (snip)

1, one, a single, cat. teeth cleaned @ $1000?

i never heard of cleaning a cat's teeth. that is a very large sum of money that if it was 1 time every 10 years i'd still question it but something tells me it is a lot more frequent than that.

Cats' teeth can need cleaning, and more often than once a decade, too, but I think bamsphd's vet is extraordinarily expensive. I would expect to be able to get two or in a pinch three cats' teeth cleaned for that kind of money!