FWIW, I don't understand some of the low expense numbers I see posted here. We have been gradually slashing expenses over the last couple of years and are getting close to the point where we have reached the maximum of milk for the minimum of moo. That said, I would have a really hard time getting our expenses under 60k. This is for a family of 4 (and 2 dogs) in a mid-cost area of the country with a $1200 mortgage payments (including escrows) and an exchange health insurance policy. Aside from the mortgage, I assume the really low numbers I see are either not real, failing to account for certain infrequent items, for smaller families, or for very low cost areas.
And for me, I don't know how I would spend $60k a year. Right now we spend under $30K per year with 2 adults, 2 teenagers, and occassionally another teenager, she is away at university, and 2 cats. Plus we like to invite people over for supper, we go through alot of food. Mind you I am in Canada so I don't have to pay medical insurance, although I do through my employer $46.73 biweekly, and I likely pay more in taxes. We occasionally travel, although I travel for work so sometimes other family members tag along, but we do travel on our own dime most of the time for vacations. We live in an area where homes are inexpensive, but other costs such as groceries, oil, insurance are expensive.
I think the difference is housing. We spend $60-65k/year, but we have a house payment. If we didn't have a house payment, our spending would rival Pete himself.
My spending (for a family of two) over the last 12 months was $48k, but that included $12K of student loan repayment and $6K of mortgage. If I had no student loan debt and my house were paid off, my spending would have been almost exactly $30k/year.
Out of curiosity, are you including things like depreciation on vehicles, periodic repair/replacement on house/appliances/etc., having to meet deductibles on health and other insurance policies some years, etc.?
Sorry, I missed this reply before.
No, the $30K I posted was for my actual expenses over the last 12 months. However, I generally assume that, on average, a proportional amount of that kind of stuff is "built in" anyway. In other words, even if any particular relatively-large expense happens only once every couple of years,
some large expense probably happens once a year.
My vehicles are pretty much fully-depreciated. My daily-driver is 25 years old, and my newest car is 17 years old. (Actually, my daily-driver is a bicycle... which is also 25 years old, LOL.)
I have some house-related expenses coming up (notably a roof replacement, which I actually plan to turn into a larger remodel involving adding a porch), but did not include that as it'll turn into more of a "capital improvement" than maintenance. Most house repairs are pretty cheap anyway because I DIY: for example, I've fixed roof damage twice in the last five years for only the cost of a square of shingles, a tube of roofing sealant, a roll of tar paper, a roll of 4" butyl tape, and a box of roofing nails (and I still have enough left for another couple of repairs). For me, an appliance replacement means spending $100 for something off Craigslist, not $1000 at Home Depot.
My insurance deductibles are small enough that I'm not overly worried about budgeting for them.
This practical exercise is for the purpose of calculating FIRE or Financially Independent Retired Early status. I can assure you that in FIRE you will need cash to pay your student loan, so that counts as an expense.
Not if the student loan is paid off.
How many people here have a FIRE plan that involves not amortizing all major debt?
A few choose to leave the mortgage, as long as enough funds are invested at higher rates of return to pay for it, but that's the only common exception.
Oh sure, I always assume FIRE comes with no outstanding debt other than perhaps, a mortgage.
Eh, it depends on the interest rate. My ~5%+ loans will certainly be paid off before FIRE (in fact, they get paid ahead of schedule, prioritized right behind tax-advantaged investments). My wife's ~3% loans, though? Not so much. We'll be keeping those until after FIRE, unless they amortize naturally first.