30K a year

[ikubak]

I have often joked with DW about being able to retire. Many years ago I would joke that we could retire immediately if we wanted to live in a trailer in Mexico. And I've always looked at retirement like that. I could have retired 3 years ago if I were willing to live less expensively.

A few days ago, I ran Firecalc and got a 94% success ratio spending 30K per year. Personally, I could live off that. We are debt free in all respects, so monthly bills are for utilities, insurance, food, etc. DW is a little more high maintenance. She would like to have more $$, so we are going to keep at it a while. My question is whether there is anyone out there living comfortably on 30K in this forum. If so, is it difficult or not? Do you spend more or less than when you were working?

 

[Sarah in SC]

That is about our intended FIRE budget ($32k actually), we are living on approximately that now, as most of our earnings are earmarked for savings. We may inch up closer to $36k by the time we actually pull the plug in 10 years.

One suggestion is to try it for six months, now, while you are working. See if it works for you. Like full time liveaboard boaters always say: you'll spend as much as you have!

 

[DallasGuy]

I'm estimating that I can live off $30k per year, but I'm single. That includes 2-3 trips per year and not living particularly super-frugally. I'd say that would be quite an accomplishment for a couple though. Included in my $30k are taxes of about $9-10k (property taxes and income taxes) and $4-5k for health insurance so thats approximately 1/2 of my expenses with just those 3 items...those amounts could vary a lot from one individual to another though. But I think it could be done by living frugally.

 

[ikubak]

I'm estimating that I can live off $30k per year, but I'm single. That includes 2-3 trips per year and not living particularly super-frugally. I'd say that would be quite an accomplishment for a couple though. Included in my $30k are taxes of about $9-10k (property taxes and income taxes) and $4-5k for health insurance so thats approximately 1/2 of my expenses with just those 3 items...those amounts could vary a lot from one individual to another though. But I think it could be done by living frugally.

Everybody has different expenses. Property taxes are low in my area. Tax on my house is less than $1K/year.

 

[maddythebeagle]

http://www.early-retirement.org/forums/f47/faq-archive-how-much-enough-30818.html

 

[OAG]

We live on a tad under 30K (2007 is going out at approximately $29K and 2006 was out at $28.3). We used to get by on less down in Florida but we moved to Ohio and RE taxes are a LOT more, so we anticipate the 30K level for the near and reasonable future. We drive a 05 Luxury (Lexus SUV), live in a $350K Condo, and have no debt whatsoever. We are older than the average and have medical care covered for life so we have a bit of an advantage in some ways. We do travel but it is usually by car to relatives and/or things we can see "on the cheap". This is for two of us who have ALWAYS LBOM; early on from necessity and later by formed habits.

 

[SecondCor521]

For the last year I have very consistently been spending at a rate of about $66K per year. That is according to Quicken, which I put everything into.

Of that $66K, approximately 2/3rds is directly related to my kids and the interest expense on my mortgage. So once my kids are grown and my mortgage is paid off, I would expect to be able to live like I live now on about $22K (in current dollars). My next biggest expense after kids and mortgage interest is taxes, which includes property taxes of about $1K per year and income/SS/medicare of about $10K per year.

I live quite frugally, single person, one medium sized house, one old car, a few inexpensive trips per year. I am 38 so my medical expenses are not very much now either.

2Cor521

 

[unclemick]

12k - 89k, age 49 -63, jan 1993 - jan 2006: up and down with spikes largely due to remodel bursts. His and hers, no kids.

Being frugal/saving hard during the later work years - meant stepping off into ER caused little budget adjustments - we stayed under 20k a lot of yrs in the 90's.

Could I get under 30k today? - maybe but early on cheap bastardhood and the 90's stock market says in my 14th yr of ER - lighten up and spend some more - you aren't getting any younger.

heh heh heh - being really cheap used to give me my jollies - trying to kick the habit - a little.

 

[kat]

I live at under 30k a year, supporting myself, a house in the city and a house in the mountains I love. No debt, driving an old reliable Honda.

I don't find it difficult at all, so I always say it simply depends on how you want to live.

 

[FinanceDude]

I couldn't live on that now, but maybe in retirement. Maybe I am different, but I don't want to HAVE to live on $30,000 a year, I want to CHOOSE to live on $30,000, but have the ability to spend more if I want to.......

 

[Maurice]

30k INCLUDING taxes? Wow, if I add taxes into the mix our expenses are more than 30k per month. I definitely intend to reduce that though before retirement.

 

[FinanceDude]

30k INCLUDING taxes? Wow, if I add taxes into the mix our expenses are more than 30k per month. I definitely intend to reduce that though before retirement.

I heard Bill Gate's expenses are $30,000 a month.............

 

[maddythebeagle]

30k in taxes a month...my hooker and crack bill is that alone...

 

[Khan]

My yearly income (pension) grosses just under $30K. I spend (including taxes and med ins) about $25K. I put the remaining $5K into the MMA.

I was spending about the same amount my last several years at work.

Pulled out a large chunk from MMA this year to buy a car (the 1989 vehicle wore out).

If you average the car in over the last several years, I still spent less than $30K annually.

I could cut back even more, but there's no reason to.

Dayton OH area, small house, 2005 car, one person, one cat.

 

[haha]

I'm single. Not including income taxes, I still am north of $30,000/yr. I might be able to do it, but I would prefer to work harder to up returns. For me, life goes downhill if I have to be super careful.

Ha

 

[Goonie]

I'm estimating that I can live off $30k per year, but I'm single. That includes 2-3 trips per year and not living particularly super-frugally. I'd say that would be quite an accomplishment for a couple though........But I think it could be done by living frugally.

The 2 of us live on a total of about $24K to $30K per year, all expenses included....property/sales/utility taxes, utilities, groceries, ins, autos, upkeep/repair, etc....the major variant year to year is the number of vacations taken...we average 3 vacations a year. We don't necessarily live frugally, we just don't have extravagant tastes. If we want something, we buy it.....we just don't want much! And we certainly eat pretty high on the [-]hog[/-] cow!!!

Everybody has different expenses. Property taxes are low in my area. Tax on my house is less than $1K/year.

Same here!

30k INCLUDING taxes? Wow, if I add taxes into the mix our expenses are more than 30k per month. I definitely intend to reduce that though before retirement.

$30K per month?! Hokey Smokes!

 

[FinanceDude]

My taxes alone are $400 a month, and I don't have a McMansion............

However,if I had no debt of any kind,I think $30,000 a year is doable.........as long as no kids in the house..........

Some of our bills:

$400 a month grocery
$150 a month gas
$120 a month utilities
$300 a month various insurances

 

[maxer]

Hi All,

It seems like quite a few (most respondents, actually) seem reasonably comfortable with 30k/yr. Its encouraging but at the same time unbelievable - no, I wont call anybody a liar - bit its just incredible!

I am seeing some exceptions like health is covered or property taxes of around a grand - in the US? where? what kind of property?

I am in Illinois and live in a fairly "high prop Tax" area and am seriously considering moving out. So Goonie or anyone else, any suggestions on low tax locations and reasonably good quality of life and a somewhat smaller town in Illinois (or elsewhere for that matter?)

Thanks,

Maxer

 

[dm]

Our budget is $65,000 after taxes. $11,000 of that is medical insurance. No debt. My downsizing, and having no fun budget, is $26,000 after taxes including insurance. I'm just recently retired, but I don't think I spend any less than when I was working, maybe more. I had a vehicle and gas furnished, and insurance.

 

[FIREd]

We currently live on 65K a year. Fixed expenses are about 38K per year, (including 10K in mortgage payments), the rest (27K) is fun money. So once the house is paid for and once we retire our fixed expenses should drop to about 28K (including health insurance). However, that does not include taxes and fun money. So 30K would be a bit tight given our current lifestyle.
However we are planning on trimming many fixed expense categories upon reaching retirement: sell the (horribly expensive to maintain) german car and buy a japanese car instead. Trade our current home for a smaller, maintenance-free and energy-efficient home, so I think that we could probably reduce our fixed expenses to about 23-25K per year (including health insurance but not taxes). So in retirement, we could possibly live on 30K a year, though it would not be much fun.
That's why we are saving enough to be able to draw 60-65K in retirement income per year from our portfolio because, as FinanceDude said, even though we COULD retire on 30K per year, we don't WANT to.

 

[dm]

Some of our monthly bills are

$550 for food
$365 for RE taxes and insurance
$600 for Auto gas, insurance, PP tax. I need to move closer to the golf club.
$400 for Utilities/phone/dsl

 

[Coach]

There is astounding variation in property tax rates in this country. In Colorado Springs I pay about .5%, of my home value each year in property taxes -- around $600 on a house worth around $120,000.

On the other hand, I'll pay a few hundred dollars per year property tax on a new car for the first several years I own it.

Coach

 

[youbet]

ikubak.......

Everyones's responses are interesting and informative, but........

Be sure you filter the information to a common denominator. Does the poster have to pay expensive health insurance premiums? What are local costs of living including real estate taxes? Would you and DW be happy hunkered down and always on a frugal budget? Single or couple or couple with kids still in the house? Are capital expenses and major home repairs/updates being accounted for? Is there some gimmick involved, such as free rent for doing chores, and not being mentioned? Is the poster benefitting from extensive bartering of his/her personal skills?

Bottom line, $30K isnt always $30K in these discussions so check out the details. And be comfortable that your and DW's personalities are congruent with long term frugality.

 

[FIREd]

Youbet is right, we may need to provide more information about our particular case:

We currently live on 65K a year. Fixed expenses are about 38K per year, (including 10K in mortgage payments), the rest (27K) is fun money. So once the house is paid for and once we retire our fixed expenses should drop to about 28K (including health insurance). However, that does not include taxes and fun money. So 30K would be a bit tight given our current lifestyle.
However we are planning on trimming many fixed expense categories upon reaching retirement: sell the (horribly expensive to maintain) german car and buy a japanese car instead. Trade our current home for a smaller, maintenance-free and energy-efficient home, so I think that we could probably reduce our fixed expenses to about 23-25K per year (including health insurance but not taxes). So in retirement, we could possibly live on 30K a year, though it would not be much fun.
That's why we are saving enough to be able to draw 60-65K in retirement income per year from our portfolio because, as FinanceDude said, even though we COULD retire on 30K per year, we don't WANT to.

So the 28K in fixed annual expenses for a couple without kids living in AL include:
Auto repair and maintenance $2200 (2 cars, VW 2001 and Mazda 1997)
gas $1700
Car Insurance $1500
Car registration and Taxes $200
Tax service Fees $400
Groceries $6,600
Home Repairs and Maintenance $2,300
Property taxes and insurance $2,400 (Home is 2500 sq ft and worth ~ 235K)
Health Insurance premiums and copays $5,200
Cable TV $1,500
Telephone / Internet $2,100
Electric/water $1,900

Total $28,000

 

[Goonie]

I am seeing some exceptions like....property taxes of around a grand - in the US? where? what kind of property?

I am in Illinois and live in a fairly "high prop Tax" area and am seriously considering moving out. So Goonie or anyone else, any suggestions on low tax locations and reasonably good quality of life and a somewhat smaller town in Illinois (or elsewhere for that matter?)

We're out in the boonies of north central IL, not too many miles from the I-39/I-80 area. Roughly about an hour or less drive from Rockford, Bloomington, Quad-Cities, Joliet, and about 90 miles from Chicago. A few nice sized towns of 15K to 20K population. A lot of small to tiny towns around. Lots of nice State Parks. Lots of great food! Taxes and property values (for the most part) are fairly reasonable....depends on the town! Crime rate is LOW!!! You can live in a shack or a mansion, or anything in between. A lot of old homes and a lot of new construction.....lots of choice. In town, lots are 7500 sq. ft. and up. Out in the country, lots start at 1 acre.

Of course, you can always move to far southern IL, around the 'Little Egypt' area and live like a Pharaoh for CHEAP!