I just looked at my annual living expenses from 2000 through 2011 - the 12 years I have been retired. I have always felt that my basic living expenses were more or less flat, or at least had only risen slightly and most of that in recent years.
From Dec 2000 to Dec 2012, cumulative inflation was
29.7% according to
InflationData.com's Cumulative Inflation Calculator
However, my basic annual living expenses only went up
2.3% over that time period. Yes - you read that right.
My basic living expenses include normal day-to-day expenses that occur annually which includes discretionary expenses such as travel, eating out, smaller toys and appliances.
It does NOT include expenses I consider "super discretionary" such as charity, gifting $$ to family, or large item one-off expenses such as buying a motorhome or the occasional computer or high-end camera body. Decisions to buy such things are made on a case-by-case basis when and if I feel I can afford them.
My year over year % change from 2000 in basic living expenses went like this:
Year YOY Since 2000 |
2001 -4.8% -4.8% |
2002 +8.5% +3.36% |
2003 -19.0% -16.3% |
2004 +16.6% -2.4% |
2005 -21.6% -23.5% |
2006 -7.9% -29.5% |
2007 +15.9% -18.3% |
2008 +2.6% -16.2% |
2009 -13.1% -27.1% |
2010 +9.0% -20.6% |
2011 +28.8% 2.3% |
Some things definitely went up over that time period like health insurance which more than doubled. So obviously other expenses went down over the same time period.
We spent quite a bit more money on travel tours during the first three years. Then switched to much more RVing type travel over the next several years which was lower overall, however spending on fuel, groceries and eating out and maintenance increased during that same time period. Finally, in 2010 we did less RVing, but we moved into a new home with higher baseline expenses.
Just FYI - thought folks might find my "personal inflation" story interesting.
Audrey