What do folks forget when making a retirement budget?

[youbet]

I discussed this issue in a thread early last year, and remain convinced that I don't want to own a single-family house longer than I can do DIY work.

https://www.early-retirement.org/fo...ppens-when-i-cant-be-the-handyman-107696.html

DIY for home maintenance is a bit more complicated than "on or off." DIY house and car maintenance is more of a transition. I used to do most of our maintenance on the house and cars. At almost 75 and with some issues, I have cut back on anything that involves ladders, heavy lifting or learning something new, complicated and perhaps risky. But I'm still pretty savvy on what and how I want things to be done and I've tracked down some good pro's. I'm OK living here currently.

When the time comes that I'm incapable of doing almost anything around here, and especially if I have a longer list of things I don't understand how and why they should be done, it's CCRC time.

 

[ncbill]

I discussed this issue in a thread early last year, and remain convinced that I don't want to own a single-family house longer than I can do DIY work.

https://www.early-retirement.org/fo...ppens-when-i-cant-be-the-handyman-107696.html

Yep, my in-laws have lived in their home since the mid-1960s which has a huge front & back yard & still do all their own landscaping.

Though given they're both now in their 80s that probably won't be continuing much longer.

 

[W2R]

When you start hiring contractors for work you no longer DIY, your budget can take a big hit.

Mine won't, because instead of DIY, I have a good handyman that I hire to get things done. I have always done this. It's been amazing to me how little it costs, and how seldom I need to call him.

 

[skyking1]

I have rolled my own on virtually everything. I think the same as out of steam, when I can't do it anymore and don't want to hire it, we will downsize accordingly.

 

[NW-Bound]

I know I can't predict all the unplanned expenses. It's too much work to think of all these things, price them out, and tally them up. The only way I know how to cope is to maintain a low WR.

Of course it is easier for people who maintain the LBYM philosophy from the pre-retirement life. It was how I dealt with financial uncertainties while still working.

 

[RunningBum]

But there is a silver maple on the front lawn that has had about 20% of its branches not green up this spring. Knew it was a short-lived tree, but didn't expect to have to take it down so soon.

I have a maple that didn't look like it was doing too well last year. Smaller leaves, and not as many of them as normal. I have a good contact in the local nature foundation and he saw it and said that sometimes they just have an off year, but the roots look great (some are above ground on the downhill side). This year the tree is looking much better and things are still greening up here on the mountain. So you might give it another year.

 

[Out of Steam]

I have a maple that didn't look like it was doing too well last year. Smaller leaves, and not as many of them as normal. I have a good contact in the local nature foundation and he saw it and said that sometimes they just have an off year, but the roots look great (some are above ground on the downhill side). This year the tree is looking much better and things are still greening up here on the mountain. So you might give it another year.

I plan to leave it alone for this year, but have taken pictures of the tree canopy from three directions for future comparison.

 

[Out of Steam]

DIY for home maintenance is a bit more complicated than "on or off." DIY house and car maintenance is more of a transition. I used to do most of our maintenance on the house and cars.

I've never been an enthusiastic DIY car maintainer, but do very little automotive work now because of arthritis in my hands. I either can't adequately tighten/loosen things or snap them off.

 

[kcowan]

I suppose the financial support of kids and grandkids has been our biggest unplanned item.

Medical items have been a bit lumpy but average out OK.

 

[Navigator]

We had our normal expenses estimated pretty well, but missed how much unexpected costs would be. This includes things like helping our sons buy houses, paying for medical equipment not covered by insurance, numerous weddings of nieces and nephews, emergency travel and paying for people to take care of our lawn and clean inside our house..

 

[tsoispf]

We didn't realize that there was a state penalty in addition to a federal penalty for early withdrawal from an IRA. It just never dawned on me. The 10% federal penalty is often talked about. A possible state penalty, not so much.

 

[pacergal]

I suppose the financial support of kids and grandkids has been our biggest unplanned item.

Definitely hear you on this. Yes, its our choice, but so far it hasn't hurt our day to day living.
Nasty, unexpected divorce, emergency C section and medical care for sick newborn. Mom/Grandma is not going to not step in and help if I can afford it.
Kids never asked, we offered.

 

[marko]

Personally, I think it’s a mistake to get too granular in budgeting. You have your core expenses like utilities, taxes, insurance and such and then a lot of variables.

You never want to be so detailed that you whip out a calculator in a restaurant to figure if you're going to go over your dining out allotment and choose a salad instead of that filet. (Yes, I actually saw someone do that once! "Oh dear! This place is more expensive than I thought!)

We plan on our core expenses and then have a big chunk for lumpy, variable, unexpected spending.

 

[skyking1]

^ life is lumpy. We like it that way

 

[RobbieB]

I forgot to make a retirement budget.

Oouuups -

 

[NW-Bound]

^^^ That's right. Budgeting is for the birds.

When the market goes up a lot, you simply spend a lot.

When the market goes down, well, you just spend a little less.

 

[RobbieB]

Yup.

Now selling one boat and one motorcycle to pay for new boat -

 

[Out of Steam]

Here's a budget item I didn't plan for. That I would wear out hiking gear quickly (and want new gear items) simply because I'm out more often.

 

[Bryan Barnfellow]

Here's a budget item I didn't plan for. That I would wear out hiking gear quickly (and want new gear items) simply because I'm out more often.

But offset, one hopes, by lower out of pocket lifetime health care costs!

-BB

 

[Out of Steam]

But offset, one hopes, by lower out of pocket lifetime health care costs!

-BB

Hope so!

 

[aja8888]

Yup.

Now selling one boat and one motorcycle to pay for new boat -

Don't you really mean to pay for part of the new boat?

 

[Rustic23]

Like others have said, the big ticket infrequent (not annual, 5-20 years) items are the most overlooked in retirement budgets. Replacing the roof, repainting the house, replacing the furnace and/or AC, replacing cars, replacing appliances (washer, dryer, oven/cooktop or range, refrigerator, microwave, disposal, dishwasher, sump pump, de/humidifier), replacing furniture (definitely mattresses if nothing else), remodeling, landscaping, deck maintenance, desktop/laptop/tablet/smartphone. I’ve been retired for 11 years and I planned for 20% for infrequent big ticket items - and that’s been about right. It will fluctuate quite a bit, $5K one year and $30K another. Of course you can delay some expenses, but you can’t avoid most of them for 20-30 years, so it’s important to budget something :

+1
Our singing fund is between 10 and 15 thousand a year. Auto replacement every five years is the largest item, and it is controllable.

 

[FIREarly]

Fun. Obviously, it's a pretty controllable expense...but if you suddenly find yourself with an extra 40+ hours a week where you have a decent amount of energy you can easily wind up spending more ( or a lot more!) on travel, activities, and hobbies. Ditto for all the projects you may have been putting off " until you have more time".

Gym membership OR adjustable dumbbells (DB set) and adjustable bench... much less expensive and uses up energy.

Careful, if done well, it might create MORE energy!

 

[jr6035]

Emergency fund. We add to it automatically every month. Pays for a new car every 5 years, thats about it. Nice to know it's there.

 

[SDHiker]

Wine!