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Old 03-27-2019, 04:50 PM   #101
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I still donít really understand how couples can live, travel, pay taxes, medical expenses, utilities, etc. spending less than $10, 20 or $30K a year. Even if you live in a state with no income tax, sales taxes and RE taxes tend to be high. Even assuming they have no taxable income (no 401Ks, Ibonds, etc), live in a remote area, own a paid off home with no debt of any kind, how is it possible to live comfortably with that low level of spending? I understand cutting the cord, having one very low cost cell phone, no trash, electric or water bills, growing your own food, but how many people really live like that. And why would they with $1M in savings? No interest or dividends? Never sell any of the assets?

I know I would not want to live that way. We travel a lot, including internationally, pay over $40K a year in SALT plus federal taxes a year (and, of course another $7K or so in Medicare, Medigap and associated medical and dental costs).

So we are nearly at $50K in those fixed costs without taking into consideration utilities, repairs/maintenance for car and house, food, clothing, etc. We prefer to use a washer and dryer, microwave and stove which all use electricity. In the summer we use A/C as 95 degree temps with 90% humidity is not tolerable. In the winter, it can get very cold and snows on occasion - oil heat costs less than electric heat, but it still isnít cheap. We do live in a HCOL area, but we have always lived in one and still managed to accumulate decent savings. The only times I can remember living on less than $15K a year were in the very early Ď70s, when I was stationed overseas in the Army and housing and utilities were free and I was driving a beater Ď63 VW bug. But I also made less than $15K a year, so spending more wasnít an option for me.

To those who live extremely inexpensive lives, more power to you. Itís just a lifestyle thatís not for us and one we would never strive for.
2 people, 1 dog. 5BR/3BA house, 2900sqft. Car, pickup, 3 motorcycles.
Arizona climate = heavy use of the A/C in the summer.
33K spending quite comfortable with room to cut if needed (2 smart phones, Cable TV, drop vehicles, etc.)

Food & Dining $6,082.91
Bills & Utilities $5,931.45
Auto & Transport $4,289.08
Insurance $3,486.51
Property Taxes $2,764.62
Health & Fitness $2,455.09 (had a root canal and a MRI)
Home $2,250.18
Entertainment $2,133.00
Gifts & Donations $2,042.88
Travel $1,034.23
Shopping $615.85
Pets $326.60
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Old 03-27-2019, 04:55 PM   #102
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it does depend on how you count.
Exactly. And there was nothing "wrong" with the way you did it. It's just that we all have to look at each other's numbers to understand if there are "qualifiers" needed in order to make the advertised spend possible.

For example, if someone has low housing costs it would help to know that he/she owns a $150k home in great condition making that possible. If you don't have one of those, better get ready to add rent or house payments.

Or if you have kids in college or private school and are paying for that expense out of a separate bucket (or maybe grand parents are paying), then someone without that separate bucket or generous parents would need to figure out how to solve that.

I saw a case where the poster had very low utilities. It turned out she had a roommate that paid one half of those. That's fine. But if you don't have a roommate to do that, better add that half back in.

Etc.

Not knocking your accounting at all. Having read dozens (hundreds?) of your posts, I admire how you've handled things and your positive attitude.
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Old 03-27-2019, 04:56 PM   #103
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Living low cost is not necessarily living a life of deprivation. We can easily spend $200 for an evening out for dinner and a play with friends. Alternatively, the same $200 would pay for […][…]
Or, you could just not spend that $200 at all, and instead, focus on truly FREE entertainment opportunities. I know that you are very good at finding out what is available for free, and probably do that a lot too.
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Old 03-27-2019, 05:47 PM   #104
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To each his or her own

I always get a kick out of people on the boglehead forum who from their posts you know they have a lot of money but they brag about cutting out cable or eating bread and water for dinner.If you live that way and you do not have to,congrats,but you have issues.Sorry,all the rationalization in the world will not convince me otherwise,unless it is based on some spiritual journey.
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Envious of low property taxes
Old 03-27-2019, 06:10 PM   #105
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Envious of low property taxes

As I read posts by folks who share their budgets showing how they live spending $15, $20 or $30K a year I see that property taxes average $2500 to $4000 a year or so. Wow. Here in Oregon, a 2600 sqft house in a Portland suburb will cost >$8000/year with the paid in full 3% deduction. Dang, maybe Arizona is the place I ought to be.
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Old 03-27-2019, 09:12 PM   #106
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Exactly. And there was nothing "wrong" with the way you did it. It's just that we all have to look at each other's numbers to understand if there are "qualifiers" needed in order to make the advertised spend possible.

For example, if someone has low housing costs it would help to know that he/she owns a $150k home in great condition making that possible. If you don't have one of those, better get ready to add rent or house payments.

Or if you have kids in college or private school and are paying for that expense out of a separate bucket (or maybe grand parents are paying), then someone without that separate bucket or generous parents would need to figure out how to solve that.

I saw a case where the poster had very low utilities. It turned out she had a roommate that paid one half of those. That's fine. But if you don't have a roommate to do that, better add that half back in.

Etc.

Not knocking your accounting at all. Having read dozens (hundreds?) of your posts, I admire how you've handled things and your positive attitude.
Again, thanks for the kind words, and I agree with everything you wrote.

My intent with my posts is to challenge the conclusion that because someone lives either in a big city or a coastal area, then people who live elsewhere on half that are somehow depriving themselves by eating bread and water or not using air conditioning or wearing clothes made of dryer sheets or whatever. Sometimes circumstances prevent it, but often it is possible to live well on less. That's all.

I didn't take it as a knock, BTW. Just using your comments as a vehicle to explain more. I have a pattern of not fully articulating everything the first time around and so I appreciate the comments because it helps me understand what I missed. Thanks!
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Old 03-28-2019, 09:11 AM   #107
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I don't consider myself frugal but my annual base spending is quite low:

I am single and live in an expensive part of France.

HOA fees: $2,260 (I own a 540 sqft, 1-bedroom condo outright. HOA fees cover heating and maintenance / repairs).
Property taxes: $550
Other taxes: $1,800 (which get me health insurance in return)
Car and umbrella insurance: $1,008 (2017 Audi A3)
Food: $5,400 (lots of organic/local/artisan food)
Gasoline: $2,200 (~$6.70 a gallon) - almost all leisure driving
Home insurance: $290
Supplemental health insurance: $1,490 (very comprehensive coverage leaving very little out of pocket)
Electric / water: $904
Cell phone: $271
Internet & TV: $565
Banking fees: $226 (unavoidable in France, unlike in the US)
Savings for car replacement: $4,500
Savings for car repairs: $700
Savings for uncovered health expenses (like OTC medicine): $700

Total: $22,864

Travel, clothing, entertainment, and other discretionary spending come on top of that and my total spend is around $36K. I don't scrimp on anything. I don't particularly like to travel far (having done enough of that for 20+ years) and I have a lot to visit just within a day's drive. Nearby family and friends provide a cheap social outlet. The small size of my condo means limited opportunities to accumulate unnecessary stuff.
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Old 03-28-2019, 01:06 PM   #108
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As I read posts by folks who share their budgets showing how they live spending $15, $20 or $30K a year I see that property taxes average $2500 to $4000 a year or so. Wow. Here in Oregon, a 2600 sqft house in a Portland suburb will cost >$8000/year with the paid in full 3% deduction. Dang, maybe Arizona is the place I ought to be.
Your post made me laugh, we are your neighbors in Hillsboro. We built our house in 1978 on 2.3ac. We have a 1400 sqft house and pay 2600 property tax.
We came from AZ. .
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Old 03-28-2019, 04:16 PM   #109
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As I read posts by folks who share their budgets showing how they live spending $15, $20 or $30K a year I see that property taxes average $2500 to $4000 a year or so. Wow. Here in Oregon, a 2600 sqft house in a Portland suburb will cost >$8000/year with the paid in full 3% deduction. Dang, maybe Arizona is the place I ought to be.
My property tax + home insurance bill last year combined to be $2,263.20 (escrow). It went down another ~$40/month this year. Home is ~2,200 sq ft 3/2 on 1/2 an acre, less than 20 years old. I cringe when I think about the never-ending payments some people have to make even if they pay off their home thanks to their high taxes.
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Old 03-28-2019, 04:36 PM   #110
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I noticed oversoul never came back to explain how 2 people live on much less than 10k. I am assuming they live in the states.
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Old 03-28-2019, 05:32 PM   #111
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I noticed oversoul never came back to explain how 2 people live on much less than 10k. I am assuming they live in the states.
If his location info is correct, then he lives in Florida.
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Old 03-28-2019, 05:57 PM   #112
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If his location info is correct, then he lives in Florida.
Maybe he forgot a zero in his number.
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Old 03-28-2019, 07:45 PM   #113
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Originally Posted by davidfin View Post
As I read posts by folks who share their budgets showing how they live spending $15, $20 or $30K a year I see that property taxes average $2500 to $4000 a year or so. Wow. Here in Oregon, a 2600 sqft house in a Portland suburb will cost >$8000/year with the paid in full 3% deduction. Dang, maybe Arizona is the place I ought to be.
OK, here's an example for you. This 2600-sq.ft. home is on the market in the nice town of Scottsdale in the Phoenix metropolitan. Asking price is $570K. Tax is $3330.

Just be prepared for the summer heat.

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Old 03-28-2019, 08:39 PM   #114
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OK, here's an example for you. This 2600-sq.ft. home is on the market in the nice town of Scottsdale in the Phoenix metropolitan. Asking price is $570K. Tax is $3330.

Just be prepared for the summer heat.


No grass to cut!!
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Old 03-28-2019, 09:04 PM   #115
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I used to have a lawn in the back for my children swing set. When they reached pre-teen age, I just stopped watering, and the grass died. A few tons of decomposed granite like the above home, and there's no sign a lawn ever existed.

No weed can grow either because it's just too dry. However, my wife has grown trees and plants there that it could become a jungle if left unattended for too long. I indulge her because she does not care to spend money on anything else, and this gardening hobby is cheap.
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Old 03-28-2019, 10:30 PM   #116
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We have AstroTurf so looks green like Wisconsin.
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Old 03-30-2019, 01:47 PM   #117
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Or, you could just not spend that $200 at all, and instead, focus on truly FREE entertainment opportunities. I know that you are very good at finding out what is available for free, and probably do that a lot too.

Even when we get comp or discount tickets we usually buy overpriced wine or make a donation to support the local arts and culture communities. They get more than if the seats had gone empty and we get a discount off full price so we try to make it a win win situation. Plus we have to pay for gas and train tickets and usually pay regular prices when we go out with friends, so I think I have optimized our entertainment budget as much as I can without a lifestyle change at this point. But this weekend I did score some free beer festival tickets and we're seeing an air show at an Air Force base tomorrow so you are right we do have some freebies in our mix.
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