2009 actuals v/s budget

[walkinwood]

It will be great to hear how your budget (SWR v/s actuals) fared in 2009.

In response to 2008, we had reduced our 2009 budget by 13%. We came in at 83% of that reduced budget. But what makes me ecstatic is that our expenses were just under 4% of our portfolio value on Jan 1, 2009.

I can't tell you what a great confidence boost that is! I feel we can pull off this ER thing. However, we'd rather spend a little more and we're both going to work a bit in 2010 & maybe even after that.

We didn't travel much after we put on the brakes in Feb though we still got in a couple of nice vacations. We watched what we bought for ourselves, but we ate & drank well, entertained freely and had a great time close to home.

We spent some time during the latter half of the year looking for work. I've managed to land a job that has the potential to be ideal for my current situation, and DW has a few promising leads.

All in all, 20 months after leaving our full-time jobs, I feel great about our finances.

Please share your financial experiences in 2009.

Happy New Year!

 

[ziggy29]

Thanks for reminding me to check. I was tighter than usual last year, so we spent about $12,000 under budget despite spending nearly $5,000 on a new roof.

2009 was a scary and insecure year for us financially, but in retrospect it was probably the best year we've ever had financially considering income, cash flow and investment performance. Odd how that works. Then again, that has to come with a cost: a j*b.

 

[73ss454]

Since we got hit hard at the end of 2008 we planned on using the 95% rule. DW and I needed a bunch of Dental work (14K) so our plan didn't work out so well. After retiring in 2006 I took a part time job last May to help out a bit during the down turn. This worked out pretty well and I'm about to re=retire at this point. We ended up spending about 5K more in total than 2008 but with the PT job I made enough to cover most of our expenses.

60K in 2008 and 65K in 2009. That was with using $400 a month for taxes as part of the calc's.

 

[bbbamI]

Oh gawd...I knew someone would create a thread on this topic.

j/k....

I'll git back wif ya in a few days when my cc statements come in.

 

[easysurfer]

I spent about $1800 under budget for 2009.

 

[Moemg]

I do the 4% of portfolio for my SWR so of course my amount was reduced last year . Amazingly I came in $11,000 under budget even with a few large purchases (appliances &furniture ),travel , car repairs and a few large gifts and lots of little gifts . Since I retired in 2008 I felt better using the 4% than my orginal amount plus inflation .

 

[FIREd]

It was much harder to keep a lid on expenses in 2009 than it was in 2008. Call it the wealth effect. With the strong market rebound in the second half of 2009 and a big pay raise in the spring, it became harder to justify our austere spending plan. We clearly let loose in the second half of the year and ended the year 25% over budget.

The culprits can readily be identified: new sofas, too many far flung vacations, too much helping others financially and especially "too much" charitable giving. Oh well... Everything else was pretty much on target and our 2009 spending remains below the average for the previous 5 years, so what the heck.

 

[W2R]

Somehow I always feel like my posts to this type of thread seem like bragging. They aren't intended to be! But OK, here goes.

My 2009 spending was 1.94% of today's nestegg (Vanguard+TSP). However, I just got my first tiny federal annuity (=pension) check this weekend.

So, my 2009 spending was 1.43% of my net worth if I subtract that pension "take home" from my spending.

My planned 2010 SWR in retirement is 3.45%. Guess I'd better stop goofing off and having such a good time, and instead put my nose to the grindstone and get busy stimulating the economy.

 

[mews]

W2R, I hear that going on Ebay while having a glass or two of wine can do that!

ta,
mew

 

[walkinwood]

Since we got hit hard at the end of 2008 we planned on using the 95% rule. DW and I needed a bunch of Dental work (14K) so our plan didn't work out so well. After retiring in 2006 I took a part time job last May to help out a bit during the down turn. This worked out pretty well and I'm about to re=retire at this point. We ended up spending about 5K more in total than 2008 but with the PT job I made enough to cover most of our expenses.

60K in 2008 and 65K in 2009. That was with using $400 a month for taxes as part of the calc's.

I also follow the 4%/95% rule for SWRs. Bob Clyatt, in a post here, advised against my taking the 95% option in my 2nd year of ER given that I was 48 at the time.

I think the part-time job is the way to go. Since our SWR can handle the bulk of expenses, it doesn't take much to fill in the 'gap'.

We have an emergency fund with about a year's expenses and had planned to use some of it to augment the 4% withdrawal. I don't count the emergency fund or the funds I have set aside for our mortgage (principal + Int) payments while determining our 4% SWR.

 

[tmm99]

My 2009 actual was about 10% lower than the budgeted, but that was due to not taking a major vacation. Otherwise, it would have been about 3% lower than the budgeted.

 

[KB]

My 2009 budgeted included moving once....not TWICE. So my actual vs budgeted was way off. I'm tightening things up for 2010 and expect to remain within budget.

 

[W2R]

W2R, I hear that going on Ebay while having a glass or two of wine can do that!

ta,
mew

I am probably the last person on earth who has never bought or sold anything on e-Bay! I'll have to look into the possibilities....

 

[Moemg]

My planned 2010 SWR in retirement is 3.45%. Guess I'd better stop goofing off and having such a good time, and instead put my nose to the grindstone and get busy stimulating the economy.

Don't worry taxes and healthcare costs will help you meet your goal !

 

[W2R]

Don't worry taxes and healthcare costs will help you meet your goal !

They might! The healthcare costs were included (deducted from my pension before I ever saw it), though the taxman might get me. Including taxes and health, it comes to almost, but not quite, 2%. So that still leaves me with some spending to do if I am going to get up to 3.45%.

 

[aaronc879]

I am probably the last person on earth who has never bought or sold anything on e-Bay! I'll have to look into the possibilities....

You're not alone. As far as I know no one in my family has ever used e-bay. I wouldn't even know how if I wanted to. I've browsed but never considered actually buying anything and I don't buy "stuff" therefore have nothing to sell.

I've never kept track of my expenses or made an official budget before but I figure last year I averaged <$1200/mo so i'll budget myself $1250/mo for 2010 and keep track of everything I spend.

 

[W2R]

You're not alone. As far as I know no one in my family has ever used e-bay. I wouldn't even know how if I wanted to. I've browsed but never considered actually buying anything and I don't buy "stuff" therefore have nothing to sell.

I've never kept track of my expenses or made an official budget before but I figure last year I averaged <$1200/mo so i'll budget myself $1250/mo for 2010 and keep track of everything I spend.

Sounds good! I kept track of every penny I spent last month, just out of curiousity, and I was really surprised at some things. I'm not sure I would know how to buy or sell anything on e-bay, either.

 

[bbbamI]

Hoo Wee...there are some thrifty folks here. I was going to give my numbers later showing essential and discretionary expenses, but y'all will think I'm a party animal.

I think I'll just lump all of it in one total...wouldn't want to give the wrong impression...

 

[aaronc879]

Hoo Wee...there are some thrifty folks here.

Based on things I read in another thread, I decided to buy some vitamin D3 today when I went grocery shopping. I couldn't believe that 1 bottle costs $9. It's a 200 day supply but it was very hard for me to spend that $9. I've been thinking about it all afternoon. "Was that $9 that I needed to spend?" is what I keep asking myself.

Then there are the people on yet another thread who talk about putting $3000+ per month onto their credit cards. I barely even take home half that much per month to cover all my expenses. I can't imagine how people can spend so much when they are trying to retire early.

There are extremes on both ends but they work for those invloved. Everyone has a different way to get to their goals. Don't feel bad if yours are different than someone elses.

 

[W2R]

Hoo Wee...there are some thrifty folks here. I was going to give my numbers later showing essential and discretionary expenses, but y'all will think I'm a party animal.

I think I'll just lump all of it in one total...wouldn't want to give the wrong impression...

Aaron is the King of LBYM, I think!! Pretty impressive. I am sure I will make up for my spending inadequacies later on. I have that car to buy. No way am I as thrifty as folks like Aaron - - I spent a lot more than he did and some of it was on discretionary stuff too. In a few years he is going to be so glad that he watched his pennies.

 

[Shawn]

I've never kept track of my expenses or made an official budget before but I figure last year I averaged <$1200/mo so i'll budget myself $1250/mo for 2010 and keep track of everything I spend.

In most years, I tabulate my annual expenses by going through my checking account and credit card statements on December 31. While this is an effective approach, it is incomplete since I pay most of my day-to-day expenses with cash. So in 2009, I tracked all my expenses to the penny. The last time I had done this was in 2001. I find this a good way to understand and control costs since it causes me to really think about each purchase.

I spent $23,878.13 last year. Not counting my mortgage ($9K), property taxes ($3K), and charity ($5K), $6973.99 was spent on general living costs (food, utilities, gas, home and auto insurance, home and auto repair, vet bills, and other items). Normally I spend about $10K for these items.

Notably, I was curious if I could spend less than $1000 on food for the entire year. By year end, I had spent $883.35, or $2.42/day. That includes everything (nutritious food, milk, juice, junk food, fast food, soda). And yes, except for a few freebies at work and 2 meals that were paid for me, I bought all my own food. It wasn't that difficult, although it's still a little hard for even me to believe that I could average only $2.42/day for the entire year.

Since I have yet to retire, I don't really have a SWR. However, if I was retired, I would have withdrawn about 0.82% of my total assets in 2009 (taking into account my financial assets, the cash value of my pension, and making adjustments for paying off my mortgage). When I do retire, I'm mentally preparing for a withdraw rate of about 1% (not including income taxes, which may add another ~0.5%). I don't know what the future will bring, so I'll be reluctant to spend more.

 

[ziggy29]

Notably, I was curious if I could spend less than $1000 on food for the entire year. By year end, I had spent $883.35, or $2.42/day. That includes everything (nutritious food, milk, juice, junk food, fast food, soda). And yes, except for a few freebies at work and 2 meals that were paid for me, I bought all my own food. It wasn't that difficult, although it's still a little hard for even me to believe that I could average only $2.42/day for the entire year.

Nice. There's got to be a book in there somewhere...

 

[aaronc879]

Notably, I was curious if I could spend less than $1000 on food for the entire year. By year end, I had spent $883.35, or $2.42/day. That includes everything (nutritious food, milk, juice, junk food, fast food, soda). And yes, except for a few freebies at work and 2 meals that were paid for me, I bought all my own food.

Food is the 1 area I feel I overspend but am not willing to reduce spending. I'm 6'6" and barely staying above 160lbs. I don't want to give up any of my food money. Because I include household items in my food spending i'm not sure exactly what I spend but I think it's at least double what you spend so that would be about $150/mo maybe more.

 

[NW-Bound]

Aaron is the King of LBYM, I think!! Pretty impressive...

And in the other corner, we have...

Notably, I was curious if I could spend less than $1000 on food for the entire year. By year end, I had spent $883.35, or $2.42/day. That includes everything (nutritious food, milk, juice, junk food, fast food, soda).

It's tough to know who wins. While Aaron's performance is impressive, I suspect Shawn's ratio of total expenses to income is pretty low, considering how much he said he made in some much earlier posts.



Also winner ...


NW-Bound and his memory.


Er, about my expenses, well, I have to ask my wife who keeps track of that.

But I know my portfolio. It's up 24.7% in 2009, and to me that's more important. Hurrah!

 

[W2R]

Notably, I was curious if I could spend less than $1000 on food for the entire year. By year end, I had spent $883.35, or $2.42/day. That includes everything (nutritious food, milk, juice, junk food, fast food, soda). And yes, except for a few freebies at work and 2 meals that were paid for me, I bought all my own food. It wasn't that difficult, although it's still a little hard for even me to believe that I could average only $2.42/day for the entire year.

Food is the 1 area I feel I overspend but am not willing to reduce spending. I'm 6'6" and barely staying above 160lbs. I don't want to give up any of my food money. Because I include household items in my food spending i'm not sure exactly what I spend but I think it's at least double what you spend so that would be about $150/mo maybe more.

I don't economize on food. Last month I spent $188 at the grocery store, and $297 eating out, for a total of $485 on food. But gosh, it was great food. Love those little New Orleans Cajun/Creole/Italian neighborhood restaurants.