Don't hate my job just would rather do what
I want to do than work doing what others want me to do.
Some (not all) expenses. I realize that I will get much abuse over these amounts!
- Food $1100 mth (groceries $800/mth - company over alot, dining out 300/mth- usually 3 people/meal)
- Total utilities $1000/mth (including 3 cells phones w/internet access)
- Home $675/mth (taxes & routine maintainence- I mow my own grass!)
- Cars $1050mth (3 cars - payments, gas, maintain)
- Vacation $300/mth
- Entertainment $250 mth (tickets, golf, fitness club, etc)
- Healthcare $1250/mth
- Gifts $125/mth (I know - alot, but DW ethnic family enjoy gift-giving)
- Cash - $400 mth don't know where it goes
- Insurance (car/home, umbrella) - $500 mth
- College/Daughter expenses - $1000
- Houshold expenses $100 mth
- home improvements budget $500 mth(eg. - new roof last year)
- Clothes $125/mth
- Charities $450 mth
Others have weighed in, here are 2-3 things to consider for RETIREMENT when expenses probably deserve some attention
Food $1100 mth (groceries $800/mth - company over alot, dining out 300/mth- usually 3 people/meal)
Having company is a good thing
Eating out is a good thing
If you had more time, would these expenses change? Hunting around for cheaper foods, possibly not needing to eat out, possibly daughter not eating with you as much?
Look for $100 in saving here... maybe even $200. Do not hold back on yourself or take something away you want, just look to do what you do for $100 less. Maybe a different restaurant, maybe a different eating style.
Total utilities $1000/mth (including 3 cells phones w/internet access)
Break this down...
water...
electric...
gas...
cell phones...
cable...
Not suggesting anything get removed, suggesting that as you work less, you might shower less, might not have AC cranked at night or heat cranked at night or something which suggests this goes down. Even if you find $100 to save here, that is less you need to cover down the line. If downsizing a house is an option (even in 5-10 years) you will need to revisit this anyway.
Home $675/mth (taxes & routine maintainence- I mow my own grass!)
Can you itemize this? Are your property taxes $7200/year?
Are the home improvements listed in this as well? Can you itemize those costs?
Cars $1050mth (3 cars - payments, gas, maintain)
This is the big one to me...
Its OK to have 3 cars... its "not OK" to have 3 car payments. In addition car payments are a temporary expense. They should exist for 2-3 years, then go away. There is a thread here on the car behavior of the board.
http://www.early-retirement.org/forums/f28/cars-some-questions-for-you-48509.html
My suggestions here would be to cut this budget into 2 aspects (car cost and maintainance).
The maintainance is $50 an oil change times 8 changes per year is $400. I realize oil changes are cheaper than $50, the idea is that if you spend only $250 per year, the other $150 is there (year over year) for the eventual $500 job to fix brakes or do other less frequent maintainance.
The car cost you have (I am guessing) is about $500 per year. This means you spend $72,000 every 12 years on the acquisition of a new car. If that number seems high ($72k is high) then lower it. $250 per year might be more like it ($36k every 12 years on acquisition of a new car). That could be 18k every 6 years, one 30k car and one 6k used car... you get the idea I hope.
I believe you can cut this cost in half, and my thought is "later" in retirement you will see this expense drop or tail off more than the others. How soon it tails off depends on lifestyle, I just don't see many 70 year olds driving cross country anymore.
Cash - $400 mth don't know where it goes
Try to track what you spend this on, its possible you are spending more than you realize.
[*]home improvements budget $500 mth(eg. - new roof last year)
$6000 per year for house improvements...
I assume some of this might be a hobby? Can you itemize what needs to be done?
Here's my thought...
add in the needed costs of next 20 years...
new roof (10k
)
new HVAC ($2000
)
new driveway every 10 years ($1000 each??)
and whatever else might be done while you still live in the house... (say 20 years)
then add that up ($14,000 is the list above) and divide by 20 (years) and spend $700/year on those projects. If you do not spend money this year (on a new HVAC) bank the $700 so when the $2000 bill arrives, you have the cash to pay for it.
If you do this "right" and also like remodeling yourself, add a fudge factor into this (like $100/mo or $1200/year). What this means is you budget $2000/year for house repairs and improvements (for example) and you spend most of this money each year... knowing that if HVAC needs replacing, that might reduce the next year's budget or change some plans (for example).
**edit to add**
if your current house is a fixer upper, and repairing it is not a hobby, have you considering moving? This could cut costs drastically.
Do not look for one single expense to make the difference... but if you cut $100 from each expense listed (for example) you can retire now with a higher firecalc success rate. It's easier to cut expenses than to increase savings.