In response to the original question of "how much does it cost", here are our budget numbers. My budget spreadsheet is fairly legendary (well...to me anyhow) in its detail, breadth and depth. It is very conservative...I go for the high end on ranges and add padding, tax and anything else I can think of.
Here are my particular parameters:
- Two adults, one baby. Baby costs about $1200 annually in incremental costs.
- Paid-for home, two paid-for cars
- Eat most meals at home, but we eat very good quality food
- No big vacations, mostly day trips to fun places
- Our "movie entertainment" is netflix and a cheap home theater setup
- No odd or unusually expensive hobbies
- I do about 98% of home and auto maintenance myself
These numbers include tires, oil changes, replacement cars and appliances, maintenance, painting, tissue paper, q-tips, soap...just about everything. We buy mostly at warehouse clubs and I while I use every manner of coupon, 10% off cose and zero payments/zero interest leverage, I dont include those in the budget.
It does not include medical insurance as thats paid out of my wifes paycheck, so you will need to add that in.
Monthly bills: $2382. This includes taxes, insurance, food, clothes, "stuff" I buy, utilities, cable tv, cable internet, etc. It also includes monthly 'miscellaneous' costs like soap, tp, paper towels, and all other manners of expenses. Even includes gas and oil for the lawn mower, bug spray, yada yada.
Annual capital costs (not inflation adjusted), including setting aside funds for cars, major appliances, furnaces, house painting and so forth: $5326
That makes our annual costs $2382x12 + $5326, or ~$34,000 a year. $93 a day.
So the bottom line is that a family of three can live in a very nice house with two very nice cars (initial capital outlay for those ~$300k) plus $34k a year if you do your own cooking, dont travel a lot, and do a lot of DIY work.
That means you can retire with $300k to pay off the house and cars and $850,000 @4% SWR to just squeak by. Fortunately I'm well ahead of the 'squeak by' numbers and the wifes monthly income more than covers our annual costs to boot.
As needed, add your medical insurance, your rent or mortgage, car payments and other debt, meals out and vacations you want to pay for, hobby expenses, expensive booze or other habits, and you should have a good approximate number to work with.
If you think I missed something, here are my 'categories':
Monthly bills:
Home Ins
Home Tax
Baby
Nat Gas
Water
Elec
Trash
CATV/BB
Phone
Car Tax
Car Ins
Gas
Food
Med
Misc
Movie rentals
"my misc crap that I buy"
The "misc" above breaks down to:
Shampoo
Conditioner
Soap
Lotion
Toothpaste
TP
Kleenex
Shaving Cream
Razors
Bandaids
Rubbing alcohol
Hydrogen peroxide
Deodorant
Wash cloths
Towels
Dog and Cat food
Dog biscuits and jerky
Costco/Sams memberships
Wormer/dog/cat meds/vet
Car maintenance
Bug killers
Fertilizer
Mower gas + oil
Drinking water
Books, music
Laundry det
Cleaners
Fireplace Logs
OTC meds
Vitamins etc
Paper towels
Foil
Plastic wrap
Small baggies
Big baggies
Dish soap
Dishwasher detergent
Garbage bags
Stamps
Batteries
I then add a 30% pad to this to cover little things, oversights, or occasional buys, plus 7.5% sales tax.
For capital costs, I include annual 'set-asides' for:
Car replacements
Water heater
Furnace
AC compressor
Housepaint
Refrigerator
Dishwasher
Range
Microwave
Washer and dryer
Car tires
Computers
Printers
Tivos/DVR's
Televisions
Living room set
Bedroom set
Gas grill
Clothes
Exercise equipment
Personal care tools (electric toothbrushes, etc)
Vacuum Cleaner
Steam Cleaner
Tools