If you had to...?

[Tom52]

We could do it for a couple of years, but a 10 year old car does not last forever and will need replaced, then you said nothing about the $30,000 being inflation adjusted, so, long term no.

[ejman]

The median household income in the community nearest where I live is $33,000 so I would think that $30-$35k is very doable since 1/2 of the community gets by on less.

[Fermion]

I could do it in our RV pretty easy. Casinos and BLM land are usually free to camp. No property tax, no utility payments. ACA paying pretty much all your healthcare costs. Food, Fuel, Vehicle insurance/registration.. On $30k I could eat steak three times a week, buy a few bottles of decent wine, and still have about $10,000 left over to blow on a two month trip each year to Costa Rica. Makes me wonder what we are going to spend our $45k budget on...

edit:

As an example, this past Sunday we saw the weather on the Washington Coast was gong to be 65 and sunny. We put the motorcycles in the rear pod on our home built RV and headed to the coast. We parked at the Quinalt Beach casino, which has a huge RV lot right on the beach for free. We stayed 4 nights and just came back. Diesel at Costco was $1.85/gal and we used about 30 gallons on the round trip. We bought some pork tenderloin, salad, and other stuff at Costco for $30 and cooked it during the trip. The 1100 watts of solar kept our battery at full charge with no generator use. The whole trip to the beach was under $100 for five days.

[ShokWaveRider]

I do not think this is as hard as some folk make out, at least ball park. If I go to my spreadsheet for last year and take what we spent It breaks down like this:

We Own our own house (Value about $800k) and have no debt, we lease a car every 3 years (need to or not).

Mandatory Expenses, Insurance, Utilities, RE Taxes, etc.: $14,470.93

Car Lease: $7,000

Discretionary Expenses: Includes Food (I know but we pay for that with Credit cards for convenience), Credit Cards: ~$15k

There is probably a lot in Discretionary that is waste and not really accounted for.

That is ~$36k

Not that much more and we really do not cut back on anything.

[rbmrtn]

I live on less than that now. House is paid for, so no mortgage or rent, starting over having to pay housing would add some to the total.

[ShokWaveRider]

I see some folk saying they are retired, but home is not paid for yet. This does not seem to make sense (to us), unless your retirement plan includes not owning but renting permanently.

If our home was mortgaged I would still need to work to afford it. When we chose to retire early, the first thing on the to do list was to pay the house off.

I guess some mortgages are sort of like rent. But it seems like any form of loan (in retirement) is like throwing money down the toilet. I know money is cheap at the moment, but still........

Although, I can talk, we lease cars which is sort of like renting I suppose. Although I will argue forever that if you change cars every 3 years or so, it is hand down cheaper than owning these days, not to mention worry free driving.

We are not in such a tax bracket where a mortgage even makes sense, that does influence our opinions.

[dand76]

Months 1 - 6: $35k - DW and I could survive.
Months 7 and beyond: $30k (now single) No problem.

[hnzw_rui]

Quote:

Originally Posted by ShokWaveRider I see some folk saying they are retired, but home is not paid for yet. This does not seem to make sense (to us), unless your retirement plan includes not owning but renting permanently. If our home was mortgaged I would still need to work to afford it. When we chose to retire early, the first thing on the to do list was to pay the house off. I guess some mortgages are sort of like rent. But it seems like any form of loan (in retirement) is like throwing money down the toilet. I know money is cheap at the moment, but still........

Given condos and townhomes in our current area are $450K+ and single family homes are $600K minimum, we're just renting now (got lucky that we found a place with cheap rent before prices bubbled up). Unless we get another real estate bust, I expect we'll continue renting while working.

I'll probably just buy property in a cheaper area maybe 5 years prior to retiring so I'll likely be one of those who carry a mortgage in retirement. I've played a little bit with the math between paying cash (will likely have to come from tax deferred accounts) vs carrying a mortgage and the nominal cost is around the same. If paying cash, then I'll have to pay a ton in taxes upfront for the distribution. If getting a mortgage, then I pay mortgage interest but at least the hurt is spread over several years.

[Katsmeow]

Quote:

Originally Posted by ShokWaveRider I see some folk saying they are retired, but home is not paid for yet. This does not seem to make sense (to us), unless your retirement plan includes not owning but renting permanently. ..... Although, I can talk, we lease cars which is sort of like renting I suppose. Although I will argue forever that if you change cars every 3 years or so, it is hand down cheaper than owning these days, not to mention worry free driving. .

I guess it just depends on your situation and how you look at things. I can't imagine a situation where I would think it made economic sense to lease a car (I've looked at it, but it seemed to be very costly). But, we don't change cars every 3 years either.

As for a mortgage, we actually did get a mortgage a few years ago when rates were at 3.49%. I figured that we wouldn't see that kind of rate for long and it gave us a lot of flexibility. We didn't have to have to mortgage and we have equity that is more than 50% the value of the home. In a few years we may downsize some more and at that time I would expect to sell this house, pay off its mortgage and use the proceeds (since we do have a lot of equity) and pay cash.

[marko]

Quote:

Originally Posted by ShokWaveRider I see some folk saying they are retired, but home is not paid for yet. This does not seem to make sense (to us), unless your retirement plan includes not owning but renting permanently. .

Retiring with a mortgage is more a matter of retirement income than cost avoidance, I think. If you have enough to live on and pay your mortgage and retire, well....

Full home ownership is not necessarily a prerequisite for RE. But it sure does help!

[ShokWaveRider]

Quote:

Originally Posted by Katsmeow I guess it just depends on your situation and how you look at things. I can't imagine a situation where I would think it made economic sense to lease a car (I've looked at it, but it seemed to be very costly). But, we don't change cars every 3 years either.

I know, I get flak from all over the place about it, but it still works (for me). Without turning this into a car leasing thread, here is some of the logic. I use

Some givens are; a) It really only works if you do not plan on keeping the car till the year dot (<5 years), b) You like to drive a new luxury car, or a or car priced >$40 - $50k, c) You typically finance a car, but like to put a relatively large down payment on it, d) You do not typically drive more than 12k miles per year. (We average 6000miles per year and take 10k mile leases.

OK that said. Let us do an example this is one I have done myself:
, it is actually based on a car I owned a few years ago when interest rates were very competitive.

Total Car Value Retail: $65k
Negotiated Value (what you haggled for): $57k
Residual Value After a 27 months Lease: $44k
Interest Rate (Money Factor): 2.4% (Yes you can haggle that too)
Depreciation: $13k (you lose this regardless)
Rental Charge: $2,772
Monthly Lease Payment: $584

OK so the car actually costs you payment wise: $15,768 for 27 Months.

I pay my leases all in one Payment for the complete lease so I do not have to pay monthly, so it actually costs less overall ~$15k for 27 months.

In this example the car was NOT worth $44k it was worth $32k. So I saved $12k there. (Of course only if I sold it after the lease was over)

Remember the dealer just want to sell the car and negotiates on behalf of the leasing company. As long as he get what he needs out of it from the leasing company, he is happy.

If for some reason the car was damaged in an accident and repaired, (your fault or not) in today's day of CarFAX and other reports, you would NEVER be able to sell the car for a decent price, if at all. People are funny that way. Unless you manage to find a fool/buyer that does not check. Not likely to happen in this car's target audience.


With a Lease you simply give it back!!! worth EVERY penny in my books.

Not to mention, I only paid tax on the lease payments.

The difference in car value at the end of the lease vs Lease payment was tax free, I used $44k of the Leasing companies money Sales Tax Free!

[Ed_The_Gypsy]

To OP'S question: We better be able to!

Sent from my SM-G900V using Early Retirement Forum mobile app

[HadEnuff]

I could live on rice and beans.
Why would I want to?

[Dawg52]

Sell my beach condo and retire from golf..........yes I could do it. Going to wait a few years though.

[eytonxav]

Necessity it the motherhood of invention!

[Bamaman]

Quote:

Originally Posted by Fermion I could do it in our RV pretty easy. . . . . As an example, this past Sunday we saw the weather on the Washington Coast was gong to be 65 and sunny. We put the motorcycles in the rear pod on our home built RV and headed to the coast. We parked at the Quinalt Beach casino, which has a huge RV lot right on the beach for free. We stayed 4 nights and just came back. Diesel at Costco was $1.85/gal and we used about 30 gallons on the round trip. We bought some pork tenderloin, salad, and other stuff at Costco for $30 and cooked it during the trip. The 1100 watts of solar kept our battery at full charge with no generator use. The whole trip to the beach was under $100 for five days.

I'm part owner of a large deeded RV campground. For $425 per year, we can stay 14 days per month for free. All I need to do is purchase another $1500 membership, and I can stay year round for $850 per year total. That's hard to beat for housing costs.

After our first RV lasted 20 years, we replaced it with a new fifth wheel trailer last year. I could easily live in it permanently. We don't even have to own a tow truck as the campground moves our trailer for us.

[W2R]

Quote:

Originally Posted by Ed_The_Gypsy To OP'S question: We better be able to!

Yes, me too!


(EDITED TO ADD: Oops, I already posted several times on this thread. Sorry! I have to admit that I love this type of thread, because it encourages me to analyze my spending. I have been letting myself spend more, because I can't take it with me. Still, I don't want to over-do.)

Being single, it shouldn't be too tough for me to cut back until spending is below $30K. It would be a lot harder if I was married or had a dependent child or parent to support.

I would rent a 2 bedroom apartment in a complex about a block away from my present location that is for rent right now. If the utilities cost in the rental would be a little less than at my present 2 bedroom dream home, which I think would be the case since the water/trash/sewage is paid, then I'd be under $30K and all set.

Otherwise I would need to cut back a little bit on discretionary fun stuff and doo-dads from Amazon. My Amazon habit is no secret here! ;D

[ABQ2015]

My big problem would be the 10 year old car. I don't/can't work on cars and in the past have had lots of problems with old cars being unreliable and requiring expensive repairs. I'd have to buy a new or lightly used car with a $300 car payment or so or go live in a very conservative west Texas town to be by my brother, the mechanical engineer who can fix anything.

Especially with my car payment, my life would consist of a small apartment, no cable, eating out limited to Mexican food or BBQ (my favorites anyway), an HMO where it takes forever to see any specialist, no kitty cats, skimping on cheap cuts of meat and groceries, haircuts at Supercuts, a serious reduction in my clothing allowance (but I would be retired and could live in jeans and yoga pants), no nice Christmas and birthday presents for my nieces and nephews, no vacations except to drive to see friends and family or day trips. I could do it but it would be tight and not much extra for emergencies.

I'm assuming that this does not include income taxes or health insurance premiums or an existing paid off home as the OP implied.

[Music Lover]

Quote:

Originally Posted by ShokWaveRider I know, I get flak from all over the place about it, but it still works (for me). Without turning this into a car leasing thread, here is some of the logic. I use Some givens are; a) It really only works if you do not plan on keeping the car till the year dot (<5 years), b) You like to drive a new luxury car, or a or car priced >$40 - $50k, c) You typically finance a car, but like to put a relatively large down payment on it, d) You do not typically drive more than 12k miles per year. (We average 6000miles per year and take 10k mile leases. OK that said. Let us do an example this is one I have done myself: , it is actually based on a car I owned a few years ago when interest rates were very competitive. Total Car Value Retail: $65k Negotiated Value (what you haggled for): $57k Residual Value After a 27 months Lease: $44k Interest Rate (Money Factor): 2.4% (Yes you can haggle that too) Depreciation: $13k (you lose this regardless) Rental Charge: $2,772 Monthly Lease Payment: $584 OK so the car actually costs you payment wise: $15,768 for 27 Months. I pay my leases all in one Payment for the complete lease so I do not have to pay monthly, so it actually costs less overall ~$15k for 27 months. In this example the car was NOT worth $44k it was worth $32k. So I saved $12k there. (Of course only if I sold it after the lease was over) Remember the dealer just want to sell the car and negotiates on behalf of the leasing company. As long as he get what he needs out of it from the leasing company, he is happy. If for some reason the car was damaged in an accident and repaired, (your fault or not) in today's day of CarFAX and other reports, you would NEVER be able to sell the car for a decent price, if at all. People are funny that way. Unless you manage to find a fool/buyer that does not check. Not likely to happen in this car's target audience. With a Lease you simply give it back!!! worth EVERY penny in my books. Not to mention, I only paid tax on the lease payments. The difference in car value at the end of the lease vs Lease payment was tax free, I used $44k of the Leasing companies money Sales Tax Free!

$15,768 for 27 months of car use is costing you $70,000 every 10 years....for a $57,000 car. And, at the end of 10 years, you own nothing.

Buy that $57,000 car and sell it after 10 years for $15,000 and you have reduced the cost from $70,000 to $42,000, a savings of $28,000.

[ShokWaveRider]

Quote:

Originally Posted by Music Lover $15,768 for 27 months of car use is costing you $70,000 every 10 years....for a $57,000 car. And, at the end of 10 years, you own nothing. Buy that $57,000 car and sell it after 10 years for $15,000 and you have reduced the cost from $70,000 to $42,000, a savings of $28,000.

I have never owned a car (in recent history) for more than 3 years, why would I start now. Leasing works great in our situation, it is not for all though.

However, I guess it all depends, in our circle of friends, about 50% lease and 50% own. The folks that own have older cars and the ones that lease have new ones typically every 2 - 4 years. The ones with older cars are forever complaining about the service costs (Tires, Service Etc.), but bragging about how they have owned their cars for XYZ years and they are paid for. While in the grand scheme of things, maintenance is not a lot, not having to worry about it is priceless. At least IMHO.