Current Retirees Spending Actuals vs Estimates (How Accurate)?

[Rustic23]

of course, since he's an adult now he has to work hard to convince us to keep helping him , no free lunch.

Les

Les,
Best plan I heard on this was from an A.F. Chaplan. He told his kids, "You go to school on student loans" when you graduate I'll pay off the loans. If you don't the dept is yours. One son went to college dropped out. When the dept came due, he ask his dad if the deal was still good. He now has a degree and is doing well.

 

[Lsbcal]

Rustic, sounds like a nice idea. I'll talk it over with the DW . Thanks!

Les

 

[novaman]

good poll. Interesting to see that almost all were either on target or underestimated, but virtually no one overestimated.

 

[MooreBonds]

Just curious as to how you factor in major non-emergency lump sum expenses (car, air conditioner, driveway, etc.)?

Seems like a $30,000 car would be treated as something other than an expense, at least for this poll. Do you keep a "major expense" fund, slice it directly from the nest egg as needed, or diligently set aside from monthly "allowance" for when the time comes (in which case maybe it is a traditional expense).

I'm not FIREd yet...but I would budget for these expenses the same way I budget for them now:
--Estimate lifespan of item (or frequency of purchase)
--Divide total expenditure cost by above # of years
--Enter the annualized fractional share into your annual budget.

That way, over time, you'll encounter a few major items sooner than estimated, you'll encounter a few items later than estimated, but it should all average out to be approximately on-time, and you'll have the funds saved up for them and won't have to worry about taking out too large of a percent of your stash one time to pay for them.

 

[kcowan]

I'm not FIREd yet...but I would budget for these expenses the same way I budget for them now:
--Estimate lifespan of item (or frequency of purchase)
--Divide total expenditure cost by above # of years
--Enter the annualized fractional share into your annual budget.

That way, over time, you'll encounter a few major items sooner than estimated, you'll encounter a few items later than estimated, but it should all average out to be approximately on-time, and you'll have the funds saved up for them and won't have to worry about taking out too large of a percent of your stash one time to pay for them.

This approach makes sense while you are working. But when you are living off your savings there is no rational place to put an annualized fractional share. Better to just plan for it when it comes and liquidate appropriate assets at the time. It might even make sense to lease for a while if the market is hot at the time.

 

[Judsen]

I've been retired 10 yrs but single now for 3 yrs. My expenses are less than SS so i'm not yet depleating savings. I just began RMD so will soon add equities to taxable savings, but being a retired facility maintenance engr. I still enjoy finding ways to save energy and extend the useful life of car, home, etc. Passive investing helps too.