Budgeting for and during ER

[wildcat]

What kind of expenditures did the ER crowd eliminate or scale back during the first phase of retirement? Or what sort of expenditures were sliced to get to ER?

 

[cute fuzzy bunny]

Cleaning and lawn services.

All the crap extras on the phone I didnt need.

Whimsical buying of expensive crap I'd fiddle with once and then throw in a closet.

Exotic vacations I didnt need anymore

Dining out at expensive places.

 

[laurence]

I'm betting the dining out will be one of the big ones for us. We alrady don't like a steak out near as much as a steak grilled at home. It's just a time/lazyness issue.

 

[Marshac]

We alrady don't like a steak out near as much as a steak grilled at home.

And they never get it right! I said 'medium', not shoe leather! When time permits, I will send a steak back.... Usually this will prompt the manager or matre 'd to come over, apologize, and comp my meal...

 

[laurence]

See now, somehow I'm only selectively good at confrontation. I can battle in the boardroom, but I freely admit I've suffered in silence in a resturant! One thing I will get in a resturant is Prime Rib. We have a rule that we try to order stuff we'd never make at home.

Expensive Travel will still be there for me, travel is a driving force for ER, can't do more than take a two week tourist trap style visit now, looking forward to a month in an exotic place, getting some "local flava",

 

[Marshac]

See now, somehow I'm only selectively good at confrontation.

I chickened out valentines day a few years back..... I was pissed, but should have been MORE pissed... My girlfriend and I went out with a friend of mine and his date to dinner. Loads of fun at an expensive place ($100/person expensive). Our waitress sucked all night (I think it's because we were the only ones without grey hair) and had a bit of an attitude.... then the check came- almost $500. I picked up the check, looked at her, and said "uh, we would like two tickets".... that's when she REALLY got an attitude and commented that we should have told her at the beginning..... whatever. Even to this day, i'm still pissed I should probably let it go.... breathe....

 

[laurence]

I try to avoid actual holidays for going out, the crowds always make the service terrible and the food abysmal. My mother in law insisted on going to a Mexican brunch on Mother's day, by my third(attempted) trip to the buffet, it looked like the U.S. embassy in Siagon, last helicopter already warming up.

 

[cute fuzzy bunny]

Our waitress sucked all night

Nope...not gonna do it.

Eating out was probably my biggest controllable expense. I used to blow through 30-50k a year eating and drinking out. Not kidding.

Laurence...I have your prime rib fix. Mix some minced garlic (out of a jar is fine), dry mustard, dry italian seasoning, salt and pepper...about 4 parts garlic, and one part of everything else...with enough olive oil to make a paste. Rub all over a nice 3-4 rib rib roast I get on sale for $3.99-4.99 a lb. Set the oven to 450 degrees. Put the roast in and let 'er fly for about an hour. This is going to make a little smoke, so have a fan ready. Drop the temp to 350. Should take about 15-20 minutes per lb total, check with a meat thermometer when you get to the 15 minute/lb part. Remember the temp will rise 10-15 degrees after standing for 15 minutes. Cut with an electric knife.

You can also do this on the grill. Put a little less of the 'rub' on it, grill over medium-high heat turning on all sides until its pretty brown. Set it on some aluminum foil and turn the sides on the foil up to hold au jus. Turn the burner off thats under the foil. Close lid and test the temp every 20 minutes.

Next morning, either do prime rib and eggs, or my prime rib hash...cut the prime rib into chunks the size of the end of your thumb. Put some chunky frozen hash browns in a pan and cook as directed. Add chopped onions and bell pepper. When the onions and pepper are done, a spoonful of minced garlic. Add in the prime rib. When the prime rib is well warmed, shake worcestershire sauce into the pan until everything is well coated...you dont want it swimming but you do want a fair bit of the stuff. Poached egg on top. Drizzle of hollandaise.

Perfect poached egg: Allow eggs to stand in shells on counter until near room temperature (while you make the hash) or put in a bowl of warm water for 5 minutes. Heat water in a skillet until boiling, remove from heat, add 2tblspoons of white vinegar and break eggs gently into water, cover and leave for 5-8 minutes, checking yolks at one minute intervals starting at 5 minutes until they're done to suit you.

Nearly instant hollandaise: melt two sticks of butter in a small measuring cup or heatproof glass. Drop two egg yolks into a blender. Add a couple of tablespoons of lemon or orange juice. Blend. Start drizzling the hot butter through the hole in the blender cap until you get a smooth thick emulsion. While it continues blending, add a few drops of tabasco, some ground pepper, plenty of salt, and a little dry mustard if you have it. Taste and add lemon/orange juice to suit. Make this at the last minute or place in a sink or bowl of hot water and reblend before you serve.

Use tarragon vinegar instead of lemon juice and add a few tablespoons of minced shallots to the above to make instant bearnaise.

If either sauce isnt as thick as you'd like, put it in a bowl and microwave for 20-30 seconds at a time, stirring vigorously between nukes until it comes to the consistency you like.

 

[charlie]

Lyn and I eat out a lot ..... about $80 - $100 per week average.
This is one area we can cut back a lot if necessary.

Cheers,

Charlie

 

[Nords]

What kind of expenditures did the ER crowd eliminate or scale back during the first phase of retirement?  Or what sort of expenditures were sliced to get to ER?

Things we cut out:
Sea pay.
Office expenses ("Hey, it's your turn to...").
High-stress socializing with co-workers (in & out of the office).
Afterschool childcare.
Weekly housecleaner service.
Rush hour.
Bicycle commuting (and see laundry below).
Paying for parking.
Weekend shopping.
Weekend dining out (except with employed friends).
Vending machines.
Stopping at convenience stores on the way to/from home/work.
Most convenience foods.  (Neither one of us particularly enjoys cooking, but now we can prepare & eat food pretty much whenever we want.)
Store-bought tomatoes.  (I never knew it was so easy to grow our own.)
Canned/bottled beverages.  (More water, less soda, beer about the same.)
Paying for cups of coffee.
Drycleaning.
Washing office attire.
About half of our other laundry (like socks).
Shoes (still wear sneakers occasionally).
Haircuts.
Shaving cream & razors.  (Twice a week whether I need to or not.)
About two-thirds of the car's miles, gas, & repairs.
The occasional carpet cleaning, tree trimming, & green waste hauling services.
Roof repair contractors (if TH can do it then I can learn too).
Buying mutual funds-- pretty much all retirement-portfolio investments.
Two tax brackets.  (We went straight from whatever's above 25% to 10%-15%.)
Investing ignorance (I've learned a lot by due diligence that I would have learned by trial & error during my working years).
Life insurance.
Dental insurance.
A whole slew of subscriptions to professional magazines.

New expenses:
Surfing.
Tae kwon do.
Ibuprofen.  Lots of it.
SCUBA diving.
More lunches out.
Chasing down bargains in the classified ads (well, the chasing part is free but the catching can get expensive).
Browsing Saturday-morning garage sales.  (Well, browsing is free but...)
Home improvement projects that we didn't have time for when we were working.  But these usually pay for themselves in utility savings or quality of life.
The power tools I've always deserved needed.

Sacrifices for ER:  Nothing comes to mind.  We still have a kid (but ask about our low monthly rental rates!), we live in a fairly high cost-of-living area, and we bought expensive real estate.  We've always practiced LBYM and our ER flowed from that.

 

[retire@40]

At semi-retirement, my budget has stayed about the same with a slight increase in the "travel and entertainment" category and a decrease in the "income tax expense" category.

My feeling is that a budget is like a diet.  If you think you are going to go from a frugal budget to an extra-lean 100% fat-free cheapo budget, chances are you won't make it, or you will have a miserable retirement.

 

[wildcat]

Seems like it would be hard to project retirement expenses b/c as Nords pointed out retirees have "new" expenses. Might have an idea of how much but not exact amount. Nords do you budget or place a max on the new expenses to help keep things reasonable?

 

[Nords]

Seems like it would be hard to project retirement expenses b/c as Nords pointed out retirees have "new" expenses.  Might have an idea of how much but not exact amount.  Nords do you budget or place a max on the new expenses to help keep things reasonable?

I track EVERYTHING in Quicken (except for the spare change we pick up off the streets) and run the numbers.  I used to do it monthly (for review comments like "Hunh.  OK.  Thanks!") but I've cut back to quarterly and may go semi-annual.  Next month I'll run the budget too and see what the forecast looks like.  But just the mechanics of tracking expenses in Quicken helps keep everyone more attuned to the money flows. 

Our lifestyle just doesn't require much money.  Usually the kid spends a bit more on school supplies, our groceries get a bit cheaper due to more home cooking, and our budgets for entertaining/dining out are half of when we were working.  So there's not much room for improvement.

We've been steadily cutting some retirement expenses because we have the time to focus on it and because we enjoy the challenge-- installing a PV array, researching & doing a couple mortgage refinancings, doing our own chores & repairs, tweaking the water sprinklers, & so on.  That's driven by personal preference/interests and not by any fear that the SWR will eat the portfolio.  Without the kid's dressage bills we're spending less money this year than previous years so I doubt that any talk of "budget caps" will survive the family's collective laughter.

Perhaps you marrieds would say that I should've seen this coming, but I've been telling spouse since day one of my ER that her Reserves income isn't necessary to the budget.  (She's having a hard time turning off her competitive turbo-boosters and I don't want her to think that she's doing it to support the family's beach-bum surfer lifestyle.)  Of course now that she has the time to pursue classified ads & garage sales (let alone single-handedly jump-starting Thailand's retail economy) she feels entitled to match her expenditures dollar-for-dollar to her takehome pay.  At least the discussion about starting the kid's Roth IRA has slowed that down a little.

We occasionally discuss some major HGTV "Before & After"- or "Groundbreaker"-style home improvements-- new backyard steps, overhauling the backyard sun lanai, installing French doors in the livingroom, adding a pergola to the sidewalk alongside the house... but those tend to take care of themselves since we rarely have the time to tackle more than one or two a year.  She's a serious bargainhunter anyway-- we overhauled our tenant's kitchen cabinets on the cheap (we did the demo & plumbing, they did the refacings & new doors, we paid cash), we did our own bathroom rehab, I cleaned & replanted the back hillside, and we used a moonlighter for our new Corian kitchen countertops (after the kid did the demo).  So even those "big-ticket" items aren't really subject to budget review.

I think the biggest expense discussions we've had in the last five years have been (1) sending the kid on two-week school field trips for a couple thousand bucks of educational experiences and (2) pumping another $3K into our 1990 Honda Civic before the engine control unit crapped out and we decided to sell it.  Pretty exciting stuff.

Now when we're empty-nesters-- that's a separate challenge.  Beginning 2010 I'd suggest buying stock in airlines, tour organizers, and diving retailers.  And anything related to Thai retail...

 

[Dreamer]

TH, I am truly impressed!! Is there anything that you don't know about or can't do?

Dreamer

 

[KB]

Thanks for the Prime rib recipe. I love prime rib but have never cooked it. When I buy steaks, I always buy rib steaks....love the flavor. I will try this.

When I lived in Tuolumne county, the best prime rib in the county was at a little place in Mi Wuk called Diamond Jims. It had herbs similar to your recipe and was wonderful. I don't know if it is still open, haven't been there in years...

 

[cute fuzzy bunny]

TH, I am truly impressed!! Is there anything that you don't know about or can't do?

No.




Ok, I dont bake. No cookies, pies or cakes out of me unless they have meat in them or can be covered with a cream sauce.

I also sort of stink at caulking, but I got better at it after doing all the caulking at my wifes old house.

 

[cute fuzzy bunny]

Thanks for the Prime rib recipe. I love prime rib but have never cooked it. When I buy steaks, I always buy rib steaks....love the flavor. I will try this.

No problemo. Its EASY. Its a big fat thick rib eye steak. Thats all. Trick is to get a nice crust on the outside and then drop the heat until its done in the middle.

If you like the stuff, about the time you drop the heat to 350 drop in a can of beef stock into the bottom of the roasting pan. After you're done cutting the roast, give it a nice hearty stir and pour it out into a gravy boat. Pour off most of the fat (or put it through a gravy separator). Salt to taste. Enjoy your au jus...the drippings and the bits of the rub that fall off season it nicely.

I also did a different thing once that worked out fine. Run the oven to 500-550...whatever it can handle. Rub the roast as above and put it in the oven, wait about 10 minutes for the oven to get back to peak temp and then shut off the heat. Dont open the door. Once you're sure you arent going to get any plumes of smoke or flames shooting out of the oven (about 20 minutes), forget it for about 4-5 hours until the oven is just barely warm. Your prime rib will be done to just about medium rare, maybe closer to medium if its a small roast and your oven can do 550+.

One other tidbit...I usually turn the roast sideways and carve the rib bones off with the electric knife staying close to the bone. That makes the roast easier to slice to a desired thickness, and the ribs disappear into the refrigerator for the cooks midnight snack

Oh yeah, and one other thing I forgot...let the roast sit out with the rub on it until it reaches room temp...about 60-90 minutes. Thats the big thing most people screw up...they take it out of the fridge and put it right into the oven. The meats cold as ice in the middle and stays raw while the outside of the roast burns.

Unless you have a GE fridge, in which case the meat is already close to room temperature when you take it out...

When you've mastered this, we'll talk about my process for deep frying a whole prime rib roast...

 

[wildcat]

Nords good response, thanks. Waiting for JG's response....

 

[sailor]

We've been steadily cutting some retirement expenses because we have the time to focus on it and because we enjoy the challenge-- installing a PV array, ...

Nords, just curious, how much you pay for a kWh in Hawaii, that your PV is cost effective?

 

[Mr._johngalt]

Nords good response, thanks.  Waiting for JG's response....

Well, I can't think of a single expense that has not been cut
(in some cases severely) in ER. I'm not kidding. Of course,
living on 25% of my pre ER income almost forces this. Still,
it was pretty easy for us. DW wishes we had been together
during some of my "glory years". OTOH, she is in better financial shape
now and so am I. But, the most important thing is we don't feel
deprived. Quiite the contrary.............

Prior to retirement (first marriage) I tried budgeting once or twice.
An almost complete disaster. Now, we don't budget at all
(financial affairs are pretty simple), but we may in the future.

JG

 

[laurence]

Thanks TH, my DW is pretty excited, the recipe is saved in our doc folder for a future special event!

 

[Mr._johngalt]

Well, I can't think of a single expense that has not been cut
(in some cases severely) in ER.  I'm not kidding.  Of course,
living on 25% of my pre ER income almost forces this.  Still,
it was pretty easy for us.  DW wishes we had been together
during some of my "glory years".  OTOH, she is in better financial shape
now and so am I.  But, the most important thing is we don't feel
deprived.  Quiite the contrary.............

Prior to retirement (first marriage) I tried budgeting once or twice.
An almost complete disaster.  Now, we don't budget at all
(financial affairs are pretty simple),  but we may in the future.

JG

Hey, I came up with two (2) expenses which are up. Dog food and toilet paper.
I'll keep working on it

JG

 

[BUM]

Since RE in January I've tried to take a top down approach to cost cutting...get to the big stuff first. Especially recurring monthly items.

Life ins....dumped most of it
Health ins. switched plans, saved $100/mo
Phones.... Had 3 land lines - now 1
Cellfones... kicked the kids off the plan
CATV.... cut services saved 20%
Cars... thats a problem. Dumped 2 out of the old biz fleet. Still have 2. Just inhereted 2. DW doesnt part with stuff easily

 

[Martha]

As I am coming on on ER, I find I am having urges to spend more money. Kind of like the last hurrah. Or maybe it results from my bout of HGTV watching. I have all this home improvment I want to do. I want to expand our apartment by annexing part of another apartment. I have all these redecorating wants. I know it drives my ERd spouse crazy whenever I talk about this stuff.

 

[Martha]

Hey, I came up with two (2) expenses which are up. Dog food and toilet paper.
I'll keep working on it

JG

Re the tp.

Not to be indelicate, but didn't you get married after you ERd?