First million is enough

[Koolau]

Now that Robbie is gone, Car-Guy will have to be the new BTD guy around here.

Heh, heh, big shoes to fill for Car-Guy but I think he's doing well so far!

 

[TheWizard]

This discussion seemed to get diverted. If you have at least a million in investable assets, why would you choose to live on 16K to 30K per year?

My new F-150 cost $55k eight years ago.
My new Mustang cost $47k last November.
My 30-day domestic road trip last October cost at least $200 a day on average.

So yeah, I wonder about people who claim those low numbers...

 

[razztazz]

My new F-150 cost $55k eight years ago.
My new Mustang cost $47k last November.
My 30-day domestic road trip last October cost at least $200 a day on average.

So yeah, I wonder about people who claim those low numbers...

Funny, I do the same thing. I also wonder about the people claiming the high numbers

 

[jim584672]

My new F-150 cost $55k eight years ago.
My new Mustang cost $47k last November.
My 30-day domestic road trip last October cost at least $200 a day on average.

So yeah, I wonder about people who claim those low numbers...

Still running the '07 Japanese econobox that I bought new for $18K.

 

[Jerry1]

Still running the '07 Japanese econobox that I bought new for $18K.

There’s no doubt that transportation is a big factor in spending whether that’s high spending or low spending. We all know Car-Guy spends money on cars. I too appreciate new vehicles. If I needed to save money, cutting down to one car and driving something that could be insured for just liability would be one of the first things I’d do.

 

[scrabbler1]

Still running the '07 Japanese econobox that I bought new for $18K.

I'm still driving my 07 Corolla I paid $18k for new. I might hit the 50k mileage mark next year, too!

 

[jimbee]

That is just beyond my comprehension. I'm closer to 16k a month (with hobby cost) and that estimate may be a little low. We just went grocery shopping yesterday (for a two week supply) and that was ~$400 which equals $800 mo. And my gasoline bill averages over $700mo. Even more if I take any long trips. Of course walking here is out of the question. Nearest signs of civilization (to buy stuff) is ~15 miles away.

Most people in the U.S. don't make $16,000 a month, let alone spend at that level. I don't know why you're surprised.

 

[Ronstar]

That is just beyond my comprehension. I'm closer to 16k a month (with hobby cost) and that estimate may be a little low. We just went grocery shopping yesterday (for a two week supply) and that was ~$400 which equals $800 mo. And my gasoline bill averages over $700mo. Even more if I take any long trips. Of course walking here is out of the question. Nearest signs of civilization (to buy stuff) is ~15 miles away.

I can see spending 16k a month with an expensive hobby. And I can see $800 a month on groceries. But $700 a month on gas is mind boggling.

That’s more than twice my average monthly gasoline bill, and I thought that I drive a lot for a retired person at 20,000 miles per year.

Congrats on truly BTD!

 

[Dtail]

We spend 8k monthly.
Pre retirement working on Wall Street, our highest spending year was 19k monthly in 2014.

 

[TheWizard]

I can see spending 16k a month with an expensive hobby. And I can see $800 a month on groceries. But $700 a month on gas is mind boggling.

That’s more than twice my average monthly gasoline bill, and I thought that I drive a lot for a retired person at 20,000 miles per year.

Congrats on truly BTD!

As mentioned above, I did a 6600 mile 30-day road trip from New England to the Four Corners area and back last fall.
My F-150 gets around 20 mpg, so 330 gallons of regular gas, ruffly.
A bit less than $3 a gallon back then but let's call it $1000 for that month.
So I beat Car-Guy!!!

 

[aja8888]

We spend 8k monthly.
Pre retirement working on Wall Street, our highest spending year was 19k monthly in 2014.

The last time I spent ~$20,000 a month was when I was in the middle of the California divorce and had to pay both attorneys!

I'm a lot wiser now (and poorer).

 

[Car-Guy]

I can see spending 16k a month with an expensive hobby. And I can see $800 a month on groceries. But $700 a month on gas is mind boggling.

That’s more than twice my average monthly gasoline bill, and I thought that I drive a lot for a retired person at 20,000 miles per year.

Congrats on truly BTD!

I'm averaging about 2000 miles a month between my two daily drivers. My new truck only gets 12 to 13 mpg on the highway "if" I drive the speed limit and it takes premium gas. My other truck get a little better (maybe 15) but uses regular gas. Adds up quick at gas prices these days.


Example of 2/3 fill-up recently.

 

[mathjak107]

I'm averaging about 2000 miles a month between my two daily drivers. My new truck only gets 12 to 13 mpg on the highway "if" I drive the speed limit and it takes premium gas. My other truck get a little better (maybe 15) but uses regular gas. Adds up quick at gas prices these days.


Example of 2/3 fill-up recently.

i bought a 2023 lexus rx500h which takes premium so i pay a dollar a gallon more . but because it’s a hybrid it gets 22-25 mpg .

so i put in about 8-10 gallons a week .

not to bad .

 

[Flieger]

This thread definitely shifted gears! (no pun intended).....

Flieger

 

[aja8888]

This thread definitely shifted gears! (no pun intended).....

Flieger

Always happens when we discuss money, cars, or relationships.

(I mean, what else is there!)

 

[wmc1000]

I think a lot of the living costs are based on what you have to spend versus what you do choose to spend. I prepare a budget based on regular ongoing expenses every year.

For 2024 the total cost for our routine living expenses is under $24,000 per year which includes property taxes and all insurance costs. Everything we own is free and clear so no mortgage or loan costs on vehicles.

Now, having said that, we don't necessarily end the year at that level because we choose to spend on other things that are not in the base budget. Typically, unless we do some major purchase we end up around the $40-45K level and SS is more than even this amount so while we have spent some of our savings, especially in 2023 when we spent significantly more, our true retirement investments have yet to be accessed.

Our NW at the time I retired, (DW left employment at age 55), was just under $1M with retirement funds totaling about 3/4 of the total.

We feel very blessed with our circumstances.

 

[5Miler]

DGF and I dump money each month into a joint account for household expenses which includes utilities, taxes, insurance, lawn care, pest control and the like. Together we put a total of just under $16K in this account.

We each pay our own auto insurance, health insurance as well as hobby/indulgence spending. Our insurance for auto/health is about $12K/year rounded way up.

So probably about $30K very conservatively for basic needs. The house account is way over funded as the balance continues to grow despite spending excess on larger maintenance items each year.

After this we start blowing money. We did a cruise with friends in March, currently on a $16K 5.5 week diving vacation we take each year, going to visit both of my sons in the summer, Alaska cruise set up for September with friends and at least one more cruise in December on our own. It has been a few years since I have taken a withdrawal from my retirement funds and DGF leaves ACA behind in July so can finally gain more access to hers.

 

[Surewhitey]

DM spends less than SS from her and SF. He's immobile now and after Covid, she's a prisoner of circumstance. They didn't spend much before too. They're living in their own world and seem content as long as we are visiting them off and on.

Pre-covid they were saving most of her SS. I have to believe this is changing with food being so high. They do have a paid for home and practically no property tax & 1 car. We take care of needed maintenance and occasional furniture upgrades. They've always lived simple.

Guesstimate is they may have had a total of $200k savings at their peak, but never a mil. They are 75 & 81 now.

 

[FIREd_2015]

WSJ article - "You Don't Need to Be a Millionaire to Retire"

"...Among seniors with $50,000 to $99,999 in savings, 86% were doing OK or living comfortably...The median retiree who reported “living comfortably” had $100,000 to $249,000...Why, then, do seniors report such high levels of security...One reason is that Social Security benefits are more generous than people think. An average couple retiring in 2022 received...nearly $46,000...Conventional financial planning also overstates the income seniors need...average household spending drops by roughly 40% from age 65 to 90. Seniors aren’t running out of money...

https://www.wsj.com/articles/you-do...wsuuhj539mo&reflink=desktopwebshare_permalink

 

[mathjak107]

WSJ article - "You Don't Need to Be a Millionaire to Retire"

"...Among seniors with $50,000 to $99,999 in savings, 86% were doing OK or living comfortably...The median retiree who reported “living comfortably” had $100,000 to $249,000...Why, then, do seniors report such high levels of security...One reason is that Social Security benefits are more generous than people think. An average couple retiring in 2022 received...nearly $46,000...Conventional financial planning also overstates the income seniors need...average household spending drops by roughly 40% from age 65 to 90. Seniors aren’t running out of money...

https://www.wsj.com/articles/you-do...wsuuhj539mo&reflink=desktopwebshare_permalink

the thinking that spending drops. is not exactly correct .

the studies showed that those who had discretionary spending tended to spend in a smile shape .

so a lot of what wasn’t done or bought tended to pay for a lot of other stuff they did do and use

however those who didn’t have much discretionary spending to stop doing or cut back on did not see spending do anything but go up as their spending just rose.

80% of married men die married , 80% of married women die alone . so it can be back to one ss check for the most part at some point as well .


there is no such thing as a standard answer .. its like asking how long is a rope when it comes to how much do i need

 

[TheWizard]

I say baloney to retired people with only SS income and $200k or less in savings "living comfortably" nowadays.
What they are doing is "surviving" while hoping desperately that they never again need to buy a new set of tire or a new roof...

 

[Chuckanut]

WSJ article - "You Don't Need to Be a Millionaire to Retire"

"...Among seniors with $50,000 to $99,999 in savings, 86% were doing OK or living comfortably...The median retiree who reported “living comfortably” had $100,000 to $249,000...Why, then, do seniors report such high levels of security...One reason is that Social Security benefits are more generous than people think. An average couple retiring in 2022 received...nearly $46,000...Conventional financial planning also overstates the income seniors need...average household spending drops by roughly 40% from age 65 to 90. Seniors aren’t running out of money...

https://www.wsj.com/articles/you-do...wsuuhj539mo&reflink=desktopwebshare_permalink

The problem with the dual SS income couple is that most seniors will spend a significant part of their lives single. And most of them are women.
As a single senior, I am OK. But, that is because I knew what to do during my earning years and especially after my divorce. Many of these people are simply ignorant of how they can safely increase their earnings.

I help out older people like myself who need to squeeze every penny they can from their savings (personal and tax-preferred). I do that by telling them what I do, and then let them make the decision for themselves. It’s rewarding to see look on somebody’s face when they realize they can more than double their interest income by moving to a brokered CD ladder. Schwab and Fidelity should treat me to a nice steak and lobster dinner every year to thank me for the added business.

A few months ago I recommended that one lady see if she could get a senior discount on her property taxes. They’ve gone up a lot in the last three years. She is now saving $2000 a year. That makes me smile. Then I advised her to get the low-income energy rate on her gas and electricity. That will save her another $100 a year. But, she is still one big bill away from scrapping for pennies.

 

[Car-Guy]

There’s no doubt that transportation is a big factor in spending whether that’s high spending or low spending. We all know Car-Guy spends money on cars. I too appreciate new vehicles. If I needed to save money, cutting down to one car and driving something that could be insured for just liability would be one of the first things I’d do.

Well yes, I guess I do but maybe not as "much" as it seems. For the last decade or so, I've been buying at least one new vehicle every 12 to 18mos. BUT, when you are trading in a 12 to 18mo old vehicle on your new purchase, the trade typically covers most of cost. I really don't keep track but IIRC, in the past 10 years I have bought 8 new vehicles ranging in "list price" from the low 60's to ~120k. However my actually out of pocket cost has ranged from a low of "minus ~10k" (they paid me) to a high of plus ~35k. Several only cost me about 2k difference. So If you add all of that up, I doubt that I've spent 100k "out of pocket cash", on new cars in the past 10 years.

 

[FIREd_2015]

the thinking that spending drops. is not exactly correct...

The first thing that crossed my mind when I read that spending drops 40% was that doesn't apply to me.

...I help out older people like myself who need to squeeze every penny they can from their savings (personal and tax-preferred)...

Do you provide this help as part of a formal volunteer organization? Someone recently mentioned to me that they were trying to get to $100k in savings. I asked that person what interest rate they were getting on their savings and the response was something like 0.05%. I replied that you can get a little over 5% today in various T-bills and the interest is state tax free. They were surprised and said they would look into it. I was thinking I could volunteer if there was an organization in my area that provided money saving tips to those that wanted help.

 

[jimbee]

I say baloney to retired people with only SS income and $200k or less in savings "living comfortably" nowadays.
What they are doing is "surviving" while hoping desperately that they never again need to buy a new set of tire or a new roof...

I know one person that does just that, with a paid off house. I know another in a similar situation, although they also get a small pension of a few hundred dollars a month. Also with a paid off house. Both of these people have had a new roof during the past few years. One just bought a new set of four snow tires last winter.

It happens.