The Money Mustache Community
General Discussion => Welcome and General Discussion => Topic started by: accolay on March 08, 2015, 10:53:15 AM
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First time post, besides introduction.
I actually signed up to the forum to throw out a WTF about this article I came across: "This couple's budget shows how retirees can live on $31,000 a year" http://finance.yahoo.com/news/couples-budget-shows-retirees-live-162607137.html (http://finance.yahoo.com/news/couples-budget-shows-retirees-live-162607137.html)
I think one of the other big take homes from this (besides the other obvious WTFs in the budget) is that many many boomers are in this exact same situation: little to no savings, didn't own their own home outright by retirement.
Oh how I do not want to end up like that. Thanks for listening!
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It seems like there was another thread about that article.
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I live on $14,400 a year and I live very comfortably. In fact, I would say my life is quite luxurious.
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I live on $14,400 a year and I live very comfortably. In fact, I would say my life is quite luxurious.
By Jove, you've beat me, MoneyCat. My basic living expenses run me $15,000 a year. And, yes, I would say (just as you have) that that amount of money buys me a very nice and comfortable lifestyle.
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Our family of 3 lives on $2,000 a mo if you don't count the principal we pay towards our mortgage. We live very very well in a nice house, have nice cars, etc.
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My spouse and I are both retired and live in The Villages Florida. We spend about 50k per year. Lots of golf.
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We can get by on approx $18000 per year up here in Canada for bare bones living. Now...that is not what we are planning to retire on - that is a different question. We are aiming for 30 to 35k per year which would cover the basic stuff plus travel, car replacement and home repairs.
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I was a little shocked & saddened that they were making $75K when working... yet their combined savings upon retiring in 401k was just $20k. What?
My take home thought was: They've proved they can live on $31k/ year now, if they'd done that while still working, they could've socked away $44,000 each year into savings!
Stuff like this fires up my frugal muscles!! Not only is it great practice for ER, but really increases the stash while the income is still flowing in!
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Hmm let's see. When I throw out school fees, travel budget, bicycle startup costs, gifts, charity..
$16665.69 last year. Rent being $11759.
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I live on about 22k, last 365 days running. There is a lot of fluff between extra spending on trying to balance experiences and expenses. I often host friends and family over weekends maintaining relationships. I could easily cut a lot of fat, but for now would rather have the experiences with them.
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I'm not ready to share my numbers. I'm at a very high cost stage of life - two kids in daycare, and very aggressively paying down the mortgage.
Once I'm not paying for daycare, or paying down thousands a month on my mortgage, my numbers won't be bad at all. But right now, they are scary. :p
Thankful for two well-paying jobs.
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Under $20k/year, $9480 of which is rent. I'm actually shooting for < $19k this year.
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I've gotten out the calculator and tried to work the numbers on this several times. With three rental units (and two mortgages between them), our overhead looks pretty high on paper. If I subtract the rental income from our overall budget, things look much more palatable. We don't have plans to FIRE anytime soon, so we are counting on these being paid off before we need to look at how much return we'll need on investments. However, the interest rate on one of them is 2.8%, so we're in no hurry on that one.
That said, our overall budget for everything as of this day in time: 44k (Whoa.)
Factoring in rental income (thus paying for themselves), ending child care, and paying off SL (in the next few months): 16500 (much better.)
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I guess we are wasteful. I figure $65k in retirement, we don't intend to live poorly. Hubby worked all this time so we could enjoy life. Our basic expenses aren't high, we have no debt of any kind, $500 a month covers our property tax, car ins, motorhome insurance, and house insurance. But I want us to each have plenty of discretionary money for things we want to do. I figure after everything is paid $200 each per week for whatever. Also added extra in for gas and items like that. We may use the RMD we pull out each year, just have to see when we finally pull the plug.
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I'm not ready to share my numbers. I'm at a very high cost stage of life - two kids in daycare, and very aggressively paying down the mortgage.
Once I'm not paying for daycare, or paying down thousands a month on my mortgage, my numbers won't be bad at all. But right now, they are scary. :p
Thankful for two well-paying jobs.
In Ottawa? Why do you need a house like that?
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I can easily live on $20k per year including my $600 per month 15 year mortgage and not really even feel like I'm being very frugal. I seriously sometimes wonder what people do with all their money. I don't consider myself very mustachian, because I spend a ton of money traveling, eating out, and going to concerts (I'm a music professor, so some of this is at least tax deductible). But even doing all that, I live on half my income and never spend over $35k in a year....that generally includes international travel and not very mustachian car...serious...how do people blow so much money? My dad's advice to me as a young adult was to buy the things you need...have everything you need, and then stop buying stuff...that's served me pretty well.
Btw, not to derail the thread, but Accolay are you a violinist?
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Once I'm not paying for daycare, or paying down thousands a month on my mortgage, my numbers won't be bad at all. But right now, they are scary. :p
In Ottawa? Why do you need a house like that?
Well, overpaying. I'm doing the same, because I have multiple mortgages that I'd like to be rid of. Once I'm not pointing $1k/week at overpaying the mortgage, I'll have a ludicrous savings percentage of like 90%.
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Once I'm not paying for daycare, or paying down thousands a month on my mortgage, my numbers won't be bad at all. But right now, they are scary. :p
In Ottawa? Why do you need a house like that?
Well, overpaying. I'm doing the same, because I have multiple mortgages that I'd like to be rid of. Once I'm not pointing $1k/week at overpaying the mortgage, I'll have a ludicrous savings percentage of like 90%.
Exactly - overpaying to get the mortgage paid down quickly. It is not a mustachian mortgage by any means though - my regular payment (without the added money I throw at the mortgage) is $1k/bi-weekly.
And TBH, as anti-mustachian as it is.....I love my place. I'm in what would be considered rural Kanata, but I can walk to a transit stop, easily bike to a grocery store, and yet I get to enjoy the space, quiet and tranquility of country living. I previously owned a semi-detached place in Crystal Beach (in retrospect, would have been smart to stay there as it would be paid off, and I'd be able to bike 10 km to work on paths), and a 4-bedroom home in Morgan's Grant (which I despised). I never plan to move again though - this place is where I plan to grow old.
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I lived on 20K a year while in grad school. I didn't get to travel as much as I wanted. As a result, I would say 23K would be my maximum.
My wife and I currently live on about 50K and that includes about 7K worth of student loan payments. Once those are gone, that would bring it down to 43K. Once the house is paid off, that would bring it down to 38K for the both of us.
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I can easily live on $20k per year including my $600 per month 15 year mortgage and not really even feel like I'm being very frugal. I seriously sometimes wonder what people do with all their money. I don't consider myself very mustachian, because I spend a ton of money traveling, eating out, and going to concerts (I'm a music professor, so some of this is at least tax deductible). But even doing all that, I live on half my income and never spend over $35k in a year....that generally includes international travel and not very mustachian car...serious...how do people blow so much money? My dad's advice to me as a young adult was to buy the things you need...have everything you need, and then stop buying stuff...that's served me pretty well.
Btw, not to derail the thread, but Accolay are you a violinist?
I guess this is a lot how I feel. I waste money on a lot of things. I don't consider myself very mustachian either by all the badassery around here. Where does the money go?
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Once I'm not paying for daycare, or paying down thousands a month on my mortgage, my numbers won't be bad at all. But right now, they are scary. :p
In Ottawa? Why do you need a house like that?
Well, overpaying. I'm doing the same, because I have multiple mortgages that I'd like to be rid of. Once I'm not pointing $1k/week at overpaying the mortgage, I'll have a ludicrous savings percentage of like 90%.
Exactly - overpaying to get the mortgage paid down quickly. It is not a mustachian mortgage by any means though - my regular payment (without the added money I throw at the mortgage) is $1k/bi-weekly.
And TBH, as anti-mustachian as it is.....I love my place. I'm in what would be considered rural Kanata, but I can walk to a transit stop, easily bike to a grocery store, and yet I get to enjoy the space, quiet and tranquility of country living. I previously owned a semi-detached place in Crystal Beach (in retrospect, would have been smart to stay there as it would be paid off, and I'd be able to bike 10 km to work on paths), and a 4-bedroom home in Morgan's Grant (which I despised). I never plan to move again though - this place is where I plan to grow old.
Hello fellow Ottawa person! I'm in Kanata north doing the same thing - aggressively paying down mortgage which amounts to multiple thousands of dollars each month. And I think the myth that having the house that you want and the house that gives you the most enjoyment, if expensive, is "anti-mustachian". It's your life, do what makes you happy!
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20k/yr like a few others upthread, 11,040 of which is rent. But looking to have 20k/yr income on top of housing expenses in post-FIRE.
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Hey all i am new on this forum. It is a good question. Well mine answer is For middle class person 5000$ per month.
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Excellent question. I suppose super, super bare bones, I'd probably need around $600.
Expenses would be as followed:
- ~$500 for rent for a studio in a dumpy part of a NYC outer borough; there are occupied mainly by college students and are super small (think 150 sq. feet.)
- $75/month for bare necessity food (I get free breakfast at the gym + plenty of fruit/lunch meets/cheese/oatmeal, which I can use to cover most of my meals.)
- $13/Month for the gym, for said free breakfast + workouts
Living that close to the college campus would knock out my transportation to work expense (free shuttle to the ferry, and I can walk from there), but definitely would increase my commute.
Phone, I'd drop and default to a wifi-only Google Hangouts VOIP.
Amazing to see how little one actually needs to survive...
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I'll call it $24k and half of that would be housing/utilities
$20k would be pretty bare bones for me
$18k and under i'd be living off ramen noodles and candle light
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A hair under $21k, roughly $10k of which goes toward rent.
Friends and family think I'm depriving myself when they learn some of the finer details, but I generally feel that I live like a king. It's a damned good life.
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I thought the question was "How much do you need? I interpreted it as how much to sustain a bearable living, but I guess others interpreted it differently...
Barebones, probably around $10,000/year when factoring in random expenses.
To live comfortably, but not going overboard, probably $15,000. I am single, so obviously YMMV.
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about $17,000 per year.
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Suppose I should have included what I need too.
Living together with my fiance, after paying off some student loans, we'll be about $21,000. And we're living well with that. We will go cheaper once our finances are totally combined.
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Made it just under $24,000 last year. I can see being able to do $18,000 on a "good" year when there are no unexpected expenses (last year included some pricy house and car repairs). That said, I'm readjusting my estimated needs upwards to $32,000 a year to be safe. That'll bump out my retirement a few years unfortunately.
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House paid and wife pays for half the expenses. I happily live off $600 p/m. Includes $50 still going to a small RA, motor bike ride and breakfast every Sunday and one concert/jazz/comedy night a month. Do not have health insurance though and house is paid off. Have been retired for just over 6 months - loving it. Will eventually make some holiday money from hobbies - but as things are going so great there is no real push to do it.
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Do not have health insurance though and house is paid off. Have been retired for just over 6 months - loving it.
Uh do you live in the US?
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Single, 46, no kids, one dog.
As of right now, just absorbing MMM, I live off of $33,744. In about 3 months, I intend that to be $22,380 per year. In reality, I intend to retire within 10 years and live off $17,100 per year.
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Barebones for us would be $40,000 with 10,000 going for health insurance. We actually spend $65,000 which allows lots of travel & going to events, etc. Also 4 old dogs is pretty expensive.
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I'm guessing my equivalent life in retirement is around $16k including rent.
Last year I spent a total of $10k, including a $3.5k vacation, but food and rent were taken care of.
Next year, when I'm back in the states, I'm guessing I'll spend under $16k if you exclude work costs (commute, work clothes, ect.). I live in a low COL area, but I think I live pretty grand life :)
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Last year I spent $25,000 - but most of that was discretionary expenses, so I guess I actually need about $12,000.
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I agree this is a reasonable amount to live comfortably
Barebones for us would be $40,000 with 10,000 going for health insurance. We actually spend $65,000 which allows lots of travel & going to events, etc. Also 4 old dogs is pretty expensive.
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Barebones would probably be about $15000 a year (and I'd need to move to a cheaper place), less still if I was sharing again.
Currently I'm probably spending nearer $30K including rent.
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If my wife and I had no discretionary spending, but otherwise maintained our current standard of living (what I consider upper middle class), it would be around $40k/yr but we would have to sell our place and move to a cheaper apartment.
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around 25k with a high protein diet and international travelling. I consider myself to be living quite well. The only thing I really splurge on is about 2k per year on clothing. I live in a plain jane, blue collar neighborhood with a median income of about 40k/person
14k when I rented out my spare bedroom and wasn't interested in travel yet
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I have a family of five. That dramatically increases our total budget compared to some of the single people here, but on a per person basis it's not so bad.
Our minimum budget is about $20k per year, or $4k per year per person, excluding housing. Housing doubles that number. And right now we're paying another $13k per year in assorted child care costs, but that figure would potentially disappear if one or both of us were home all day.
So we currently spend something north of $50k/year with two full time working professional parents. That level of expenses buys us a lovely 2500 sqft home in a good school district with a view of the mountains and all of the trappings of modern consumer culture in a high cost of living area. Big tv, a bunch of cell phones, a fancy car with heated leather seats.
Honestly, I'd be hard pressed to figure out how to spend any more without doing something stupid. It baffles me that people who make twice that amount can claim they are barely getting by.
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Heated leather seats!!!
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My wife and I spend about $10,000 a month. We both retired somewhat early, 50, and can afford it so why not. We could of coarse live on much less. But we chose not to.
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Currently, 85-90 not including college costs ( currently 60K - but that goes away in a few years). Some other costs will go away soon, ie mortgage/car payment but may be replaced by medical insurance in retirement, so the aim is to support existing spend rate with a 3%WR.
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While I truly admire those that can live on $20K or less a year, for me that would feel like a life of constant deprivation. My number is much higher, in large part because DW and I like to travel a lot and eat well.
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Roughly $16.000 a year which would cater for needs + wants.
Needs only would be $12.000 tops.
If relocating to a low cost country numbers would be $8.000 and $4.000.
I am aiming for $16.000 and tempted by living luxurious in a low cost country.
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$16,000 a year. I have a roommate. My set costs (rent, utilities, wifi, $5 cell plan, insurance) are $676 a month.
But when I FIRE--I will have to pay for medical (although I should get subsidies of some sort), and I want to travel more (but I will try my hand at travel hacking). So I want to have $2000 a month, or $24,000 a year.
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I cannot understand how people's budgets are sooo small. I want to get there, I really do. Right now, we are at at least $50k a year - probably more.
I'm finally starting to track all of my spending but my DH and I have separate finances so I can only work my own half of the budget. I spend at least twice as much as him anyway, because of kid expenses (he's stepdad).
I will get there!!!
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I cannot understand how people's budgets are sooo small. I want to get there, I really do. Right now, we are at at least $50k a year - probably more.
Well for me, it's because I've never earned $50k! I'm frequently shocked and appalled that lots of people can spend more money in a year than I've ever earned.
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I cannot understand how people's budgets are sooo small. I want to get there, I really do. Right now, we are at at least $50k a year - probably more.
Well for me, it's because I've never earned $50k! I'm frequently shocked and appalled that lots of people can spend more money in a year than I've ever earned.
Bingo
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I cannot understand how people's budgets are sooo small. I want to get there, I really do. Right now, we are at at least $50k a year - probably more.
Well for me, it's because I've never earned $50k! I'm frequently shocked and appalled that lots of people can spend more money in a year than I've ever earned.
Bingo
Yes, exactly.
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I cannot understand how people's budgets are sooo small. I want to get there, I really do. Right now, we are at at least $50k a year - probably more.
Well for me, it's because I've never earned $50k! I'm frequently shocked and appalled that lots of people can spend more money in a year than I've ever earned.
Bingo
totally fair. necessity is also the mother of frugality and efficiency.
I'm combing through my budget and I know some of my expenses are face punch worthy. the low numbers are INSPIRING!
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Btw, not to derail the thread, but Accolay are you a violinist?
Wow! Gold Star for that association. No violinist, but I dabble.
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While I truly admire those that can live on $20K or less a year, for me that would feel like a life of constant deprivation. My number is much higher, in large part because DW and I like to travel a lot and eat well.
Our health insurance alone is $15,000. I didn't even include taxes.
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Ours is $10,000 even though we retired from a public employer.
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I dread to see what ours is. I initially went on medicare but it cost so much since my husband was still working I went back on his. I thought medicare would be cheaper. But no, since he made so much we had to pay a higher amount because the premiums are means tested, I had no idea about that.
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Y'all are going to laugh, but I really don't know what we live on.
By far, our largest expense is TAXES. Followed by TAXES, TAXES, TAXES and Insurance. These taxes typically vary with income.
So if I work a lot, they are higher, if I work less, they are lower.
My guess is that we (most years) live on 40-50K per year, with a huge percentage of that being TAXES.
Our actually cost of living, outside of taxes, though, is very low.
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http://earlyretirementextreme.com/ere-health-insurance.html (http://earlyretirementextreme.com/ere-health-insurance.html)
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Y'all are going to laugh, but I really don't know what we live on.
By far, our largest expense is TAXES. Followed by TAXES, TAXES, TAXES and Insurance. These taxes typically vary with income.
So if I work a lot, they are higher, if I work less, they are lower.
My guess is that we (most years) live on 40-50K per year, with a huge percentage of that being TAXES.
Our actually cost of living, outside of taxes, though, is very low.
IMO taxes are not an expense ( apart from property ) , money was never yours to begin with. Any calcs I do for saving rate etc are always based on take home, could never understand why anyone factors in gross pay.
The fact that couple can earn 90k from investment income in the US and not pay any tax is amazing and if you can live on 4o-50k taxes should be the least of you worries - so stop f@cking whining
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In the mid $40k range, excluding principal on a soon-to-be-paid off mortgage.
This is for 2 adults and includes luxury on a truly epic scale! 3 months in Europe! A week in Venice, a week on the French riviera, 2 months in southern France, etc. Truly millionaire living.
It's mind-boggling what you can do on about half of the median income for my area of western Canada (which was $94k in 2010, and likely a fair bit more today).
Our "need to live" sum would obviously be far below this millionaire-level spending. I'd say about $24k (Canadian) could be very comfortable.
If we spent that whole median income amount . . . . what would we use it for? I know: granite countertops. We don't have those. Waaahhhh.
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Well, "it depends" ... My house payments are almost 31k per year right now (augh!!!!!!). But, when the house is paid off, and if I don't have to buy health insurance - I could live on not too much money. But right now - right now I have two little kids, and debt from a divorce which cost me basically all my savings, and a house, and hope to retire someday.
But if it were just me - maybe $1000 a month if I didn't have to pay rent or for health insurance. IN fact, $1000 a month would be lovely for just food and clothes and discretionary spending sorts of things.
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First time post, besides introduction.
Hey accolay, I'm new here too.
To answer your question, to live as I currently do, I require about $950 per month. That includes no contingencies (home or vehicle repair, doctor visits, etc). My house is paid off, which helps a lot. My actual spending is closer to $1,500 per month. My savings rate is 80% or better, so I am going to allow myself to spend a little extra.
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I cannot understand how people's budgets are sooo small. I want to get there, I really do. Right now, we are at at least $50k a year - probably more.
Well for me, it's because I've never earned $50k! I'm frequently shocked and appalled that lots of people can spend more money in a year than I've ever earned.
Bingo
totally fair. necessity is also the mother of frugality and efficiency.
I'm combing through my budget and I know some of my expenses are face punch worthy. the low numbers are INSPIRING!
Yes *but* it's all about cost of living.
If you buy a $40k house in (large number of places in US where this is possible), get 'homestead allowance', you need a damn site less than if 2 bed houses are $150k.
That's why stuff likw this is not hugely helpful - in India you could live pretty well on a few $k a year, in the UK in certain areas £5k and in others £25 might be tight.
In Canada it's the same. Work somewhere with high pay? Good chance the cost of living there is going to be high.
The bestest thing IN THE WORLD is being able to work remotely while being paid well.
That, and root beer. Mm, and the pizza we had last night was pretty good, too.
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While I truly admire those that can live on $20K or less a year, for me that would feel like a life of constant deprivation. My number is much higher, in large part because DW and I like to travel a lot and eat well.
Our health insurance alone is $15,000. I didn't even include taxes.
I'm fortunate, mine is only $7,385/year, but that's because it's subsidized very heavily by my employer, and will continue to be so (hopefully) in retirement.
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When people throw out their budget numbers, are they including money for long-term housing repairs or next vehicle purchases?
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The bestest thing IN THE WORLD is being able to work remotely while being paid well.
Good old-fashioned arbitrage is to earning HCOL-area pay while actually living in a LCOL area.
I've been thinking recently about the amazing opportunities the Internet has opened, especially regarding investing. It's empowering to know my "little green employees" can go to work on Wall Street just like anyone else's while I'm many hundreds of miles away.
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$24,000 a year, of which about $9,000 is housing, and yes that includes long-term maintenance (I live in a condo and the monthly fees pay for current upkeep and long-term planned maintenance). I don't own a car because Montreal has fantastic public transportation and I prefer to walk or bike anyway. That number is the gross amount before taxes BTW. Includes all the usual expenses and 1 flight to the US a year to visit family.
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We're trying YNAB but, honestly, it's not helping *that much* because.. we're all over the place.
Wife works part time, plus side job; I work part time; we have rentals; because I'm temporarily working we have a couple of days a week of daycare at the moment.
We have dividends coming in, investments going out, tax set aside for our businesses... she has invoices and expenses one month that might not get paid til the next month..
I'm finding it very hard to separate "our" expenses from our "costs of earning money".
And it's all transitional. I know I won't be working (much) after June (til next year, maybe), but I'll be stepping up my BeerMoney game.
Closest I can come is that we've spent $5k in the last three months. But that's *spent* not budgeted. We are *budgeting* all the money that comes in.
I guess at the end of the year we can go and make our own reports to see exactly how much we spent on groceries, per month.
We're of course budgeting for maintenance on the house, car repairs, house insurance (which we pay once a year as they charge ~3% to do it monthly... though I'm beginning to wonder if that's a better deal).
It's good in that we're setting an allowance, and I can see where the money's going, I guess.
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Our burn rate is currently $100k per year / $8.3k per month. Family of 5 with one daughter in college another about to start.
Monthly break out with some categories rounded up to the nearest $100.
$2500 tuition + living expenses 3 kids
$1800 US house ITI
$1000 travel
$900 Malaysia rent
$800 household/clothes/furniture/gifts/entertainment
$700 food
$400 insurance/ medical
$200 local transportation
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for those of you sub $20k, are you single adults living on that?
We are a family of 4, converted to USD, we live on about 35k p.a..
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I cannot understand how people's budgets are sooo small. I want to get there, I really do. Right now, we are at at least $50k a year - probably more.
Well for me, it's because I've never earned $50k! I'm frequently shocked and appalled that lots of people can spend more money in a year than I've ever earned.
Bingo
Yes, exactly.
Same here.
Another thing that boggles my mind, are the people who spend $300+ per couple on food, and think it is normal.
Maybe it is normal, but averaging $150 per person, per month, is a lot to me.
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I cannot understand how people's budgets are sooo small. I want to get there, I really do. Right now, we are at at least $50k a year - probably more.
Well for me, it's because I've never earned $50k! I'm frequently shocked and appalled that lots of people can spend more money in a year than I've ever earned.
Bingo
Yes, exactly.
Same here.
Another thing that boggles my mind, are the people who spend $300+ per couple on food, and think it is normal.
Maybe it is normal, but averaging $150 per person, per month, is a lot to me.
Oh. We used to easily spend $1500-$2000 a month on food for 4 people. So, $500 per person? Getting it down to $700 for the whole family was a big deal and was one of the things that enabled us to FIRE.
I don't understand how you can't understand how others blow money out of their asses. We live in a society where at every waking moment you have an opportunity to buy shit. It just takes an ounce of mindlessness and access to credit and you're off.
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I cannot understand how people's budgets are sooo small. I want to get there, I really do. Right now, we are at at least $50k a year - probably more.
Well for me, it's because I've never earned $50k! I'm frequently shocked and appalled that lots of people can spend more money in a year than I've ever earned.
Bingo
Yes, exactly.
Same here.
Another thing that boggles my mind, are the people who spend $300+ per couple on food, and think it is normal.
Maybe it is normal, but averaging $150 per person, per month, is a lot to me.
Oh. We used to easily spend $1500-$2000 a month on food for 4 people. So, $500 per person? Getting it down to $700 for the whole family was a big deal and was one of the things that enabled us to FIRE.
I don't understand how you can't understand how others blow money out of their asses. We live in a society where at every waking moment you have an opportunity to buy shit. It just takes an ounce of mindlessness and access to credit and you're off.
I guess if you are going to embrace the "MMM" lifestyle (for lack of a better word), spending that much money on food is crazy.
I would think people would be taking to heart how to be FIRE, if they are following this forum.
....My husband and I already were retired when I started reading MMM (aged 46 & 50)...4 years ago
I only read this forum for fun, not advice .
Your previous spending on food (2k) is almost double than what we live on now...and we travel 8 months of the year in Australia (we are from Canada)
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I "could" live on maybe 6K/year but this would require an extreme lifestyle which would not be fun.
I currently spend just over $20K/year but I am young and single.
My FIRE budget is $40K.
Since the question is how much do you need, it's probably $6K.
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Food is also really going up. We used to spend $300/month for 2 people & now spend 400. Meat especially has risen & we eat meat once a day. I also make some casseroles to stretch the meat. However, we built into our budget extra expenses so it is no big deal.
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let me pose a question to the folks out there with actual annual living expenses <20k/yr:
If you made, say, 250-500k/yr...would you still do it?
I wager to bet that lifestyle creep would kick in, despite what you may think...
A better question might be posed to those of you who do make that kind of money. anyone?
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When people throw out their budget numbers, are they including money for long-term housing repairs or next vehicle purchases?
We're at about $20k/person right now pace. About 25% rent, 25% giving, and about 20% total vehicle expenses. Includes vacation, gifts, etc.
About $300-350 on food and household expenses per month for two of us.
These numbers will go down I'm sure over time since we're relatively newly married and still getting used to what that looks like.
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When we both worked full-time we made together $130K/yearly & spent $70,000K.
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let me pose a question to the folks out there with actual annual living expenses <20k/yr:
If you made, say, 250-500k/yr...would you still do it?
I wager to bet that lifestyle creep would kick in, despite what you may think...
A better question might be posed to those of you who do make that kind of money. anyone?
I'm probably around $15-$18k (does not include housing)
if i made that much money i'm sure that number would be more like $25-$35k plus housing
I honestly dont know what i'd spend money on...more golf? more tools? more travel? those are about the only things i 'want' more of...
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Those of you that post, are you answering for your family or dividing by the number of people?
It seems most posts say "I spend x amount" and not "We spend X and are a family of Y". Not sure if this is because most posters are single or simply stating their amount per person.
We are a family of 3 and we spend about 24K$ excluding mortgage principal.
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Those of you that post, are you answering for your family or dividing by the number of people?
It seems most posts say "I spend x amount" and not "We spend X and are a family of Y". Not sure if this is because most posters are single or simply stating their amount per person.
We are a family of 3 and we spend about 24K$ excluding mortgage principal.
I'm single, spend about 1200/month give or take a few hundred depending on stuff (again, doesnt include housing/utilities)
getting rid of my car payment would reduce that by 270/month
My next biggest spending category is hands down groceries....i love organic quality meat, and the grocery bill reflects that :)...i also probably drink too much :)
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I need to live quite a bit. Not really flexible on that point.
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I cannot understand how people's budgets are sooo small. I want to get there, I really do. Right now, we are at at least $50k a year - probably more.
I'm finally starting to track all of my spending but my DH and I have separate finances so I can only work my own half of the budget. I spend at least twice as much as him anyway, because of kid expenses (he's stepdad).
I will get there!!!
Giro - I hear ya! I've cut my budget a LOT from over 5000/month down to 3900 per month. (My house is paid off) I need to get down to less than 3000/month to retire in 2017, so Im still workin' it.
Here is what Ive done so far:
1. Analyzed all spending. I used Fidelity expense tracker because I already have a fullview account linked to everything. I already had all past spending data in the system going several years back. I just had to spend a few hours digging into the transactions and editing the categories.
2. Once I had the categories set up, I compared my spending with with MMM family to see where mine was way out of line.
3. Then, I started knocking down budget, one category at a time, starting with the big ones.
Heres what I found so far:
My grocery spending was way out of hand. Sometimes I spent up to 1000/month on Groceries. Now Im spending around 400 or so. Cutting this was much easier than I thought it would be.
My property tax is over 6K where MMM is like 2K. I called my tax collector and she sent me forms to fill out to file for a STAR reduction in tax. I wont see it this year, but next year I should see a 700$ reduction.
Also MMM house insurance is 410 a year, and mine is over a thousand...so I called our insurance agent and ask him to do a policy review of ALL our policies, home, auto, umbrella, and give me some options...higher deductible? Shop Around? I found out that DH had an active policy for a couple of old "classic cars" that he doesn't even drive anymore!
I feel Ive made huge strides in cost cutting, and have been amazed at how painless some of the cuts really were. So dont give up!
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let me pose a question to the folks out there with actual annual living expenses <20k/yr:
If you made, say, 250-500k/yr...would you still do it?
I wager to bet that lifestyle creep would kick in, despite what you may think...
A better question might be posed to those of you who do make that kind of money. anyone?
In a few short years, that will be our reality, because all of our rental property mortgages and debt will be paid off (we will then make closer to $250k pa)
Maybe lifestyle will creep in, but not by much.
I hate shopping, except for groceries (love searching for bargains there)
I think it is similar to people winning the lottery.
Some will blow through that money quickly, and others don't.
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I cannot understand how people's budgets are sooo small. I want to get there, I really do. Right now, we are at at least $50k a year - probably more.
Well for me, it's because I've never earned $50k! I'm frequently shocked and appalled that lots of people can spend more money in a year than I've ever earned.
Yes, it can be shocking how much people think they NEED to spend. You'll find it gets worse if you go to other non-Mustachian blog and forum sites.
Like you, I never made more than $50K gross. That didn't stop me from being able to earlier retire at 53. And I got started on the journey pretty late (at 42).
So... keep the faith. You can get there.
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let me pose a question to the folks out there with actual annual living expenses <20k/yr:
If you made, say, 250-500k/yr...would you still do it?
I wager to bet that lifestyle creep would kick in, despite what you may think...
A better question might be posed to those of you who do make that kind of money. anyone?
I'm at about 22k/yr right now, with about 50 percent of that being rent and $3600 being car payments (Which will soon be over, thank god). I'm fortunate to already have a strong income, but if it was 250k strong, my expenses would likely increase dramatically. There's very few things I would buy, but I would definitely go out to eat more, go on longer trips, ect.
Let's be honest, if you're single and making 250k+, a little lifestyle creep isn't going to significantly alter your path to FI. You're pretty much there.
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Currently my expenses are 11-12k a year as a single male. Could get them down to around $7,500 or less if I had to. Would be quite unpleasant though. At my current spending of 12k/year I am comfortable although plan to spend 15k - 18k in retirement.
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It's difficult to define a need. If you need a job to support your basic needs, then you likely need a car and housing near where your job is, artificially inflating your "real" needs.
1. Food - couldn't be more than $2,400 a year no matter where you are in the country...and that's arguably over ones needs at $200/mo
2. Housing - basic housing should cost no more than $500/mo or $6000/yr if you own in a reasonable part of the country (again, do you need to live in NYC?) including taxes/insurance/maintenance
3. Cell phone - no more than $120/yr
4. Insurance/medical- highly variably but we'll say $2,400 a year to be fair. $200/mo doesn't seem to be uncommon now
5. Internet - $720/yr (one could argue if this is a need or not for non work purposes - but for most it definitely is)
6. Car - no more than $1,400 a year (assuming paid off car in great shape - probably pushing this number slightly)
7. Entertainment - $1,200/yr (includes travel
Total - $14,240/yr per person. This obviously drops if one doesn't need a car or lives with someone else. I'm considering entertainment a need because if would be silly not to. Did not account for any sort of unexpected expense that could occur.
So I'm not sure how anyone is living under $14k without being in some sort of alternative lifestyle or with subsidized housing.
This number is also very close to what many answered, so I think it's pretty accurate. It's not exactly bare bones, but pretty accurate for most people. The car expense is debatable depending on how far one lives from work, but most people still need a car around. The entertainment expense, is the "live in the now" at a basic level to reward oneself, and the reality is most aren't going to live without this one.
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I need to live quite a bit. Not really flexible on that point.
hahaha.
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I was raised on less than $20k a year. Family of 4. We lived quite well. Traveling, sailing, fishing.. homeschooled.
I am now trying to pin down my monthly expenses. But they are all over the place. And lots of stuff is related to work.
I do know that for Dec, Jan, Feb, I spent a total of $2,440 so $813 a month. But I was out of the country and I didn't "do" much, just worked on the internet booking shows for my summer tour.
For March I am at around 1,500 already. But the majority of that is business expense that would not otherwise be there unless I was making money.
It is hard to define "need" and then including rent is hard, since some people have none... Including health insurance is hard, since again not everyone has health insurance.
This is a hard question to answer.
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Y'all are going to laugh, but I really don't know what we live on.
By far, our largest expense is TAXES. Followed by TAXES, TAXES, TAXES and Insurance. These taxes typically vary with income.
So if I work a lot, they are higher, if I work less, they are lower.
My guess is that we (most years) live on 40-50K per year, with a huge percentage of that being TAXES.
Our actually cost of living, outside of taxes, though, is very low.
I agree with this.
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Another thing that boggles my mind, are the people who spend $300+ per couple on food, and think it is normal.
Maybe it is normal, but averaging $150 per person, per month, is a lot to me.
What are you eating?
Are you eating mostly processed stuff or are you buying fresh ingredients and preparing your own meals?
$150/person a month is absolutely do-able, and probably not even all that extreme. But something my wife has noticed in a lot of YouTube videos she's watched that are about saving the maximum amount of money is that they're eating garbage.
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Another thing that boggles my mind, are the people who spend $300+ per couple on food, and think it is normal.
Maybe it is normal, but averaging $150 per person, per month, is a lot to me.
What are you eating?
Are you eating mostly processed stuff or are you buying fresh ingredients and preparing your own meals?
$150/person a month is absolutely do-able, and probably not even all that extreme. But something my wife has noticed in a lot of YouTube videos she's watched that are about saving the maximum amount of money is that they're eating garbage.
I think she was saying that $150 / person is more than enough and thinks it's probably too much.
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Another thing that boggles my mind, are the people who spend $300+ per couple on food, and think it is normal.
Maybe it is normal, but averaging $150 per person, per month, is a lot to me.
What are you eating?
Are you eating mostly processed stuff or are you buying fresh ingredients and preparing your own meals?
$150/person a month is absolutely do-able, and probably not even all that extreme. But something my wife has noticed in a lot of YouTube videos she's watched that are about saving the maximum amount of money is that they're eating garbage.
I think she was saying that $150 / person is more than enough and thinks it's probably too much.
I was just wondering what that buys them.
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Y'all are going to laugh, but I really don't know what we live on.
By far, our largest expense is TAXES. Followed by TAXES, TAXES, TAXES and Insurance. These taxes typically vary with income.
So if I work a lot, they are higher, if I work less, they are lower.
My guess is that we (most years) live on 40-50K per year, with a huge percentage of that being TAXES.
Our actually cost of living, outside of taxes, though, is very low.
I agree with this.
I don't. As somebody said earlier, you can't really count taxes as an expense. That money was never really yours to begin with.
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To those who think, referring to taxes, "that money was never yours to begin with" - whose money was it?
Taxes absolutely are an adjustable expense. E.g., you can choose to live where property taxes are high or low. You can also choose to live in states and cities that have income taxes or not.
There is even legal precedent: "Any one may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one's taxes." - Learned Hand.
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To those who think, referring to taxes, "that money was never yours to begin with" - whose money was it?
Taxes absolutely are an adjustable expense. E.g., you can choose to live where property taxes are high or low. You can also choose to live in states and cities that have income taxes or not.
There is even legal precedent: "Any one may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one's taxes." - Learned Hand.
You're very cavalier about the decision to pick up everything you own and move it. I've done this several times in my adult life and let me tell you, it's not easy, and it's not for the faint of heart.
Clearly there are times when it's necessary, but abandoning your social network simply to save a few thousand a year in taxes is a lot of effort for not a lot of reward.
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Age 24 and 22
3500->4000 a month + mortgage
So around 50k to 60k a year but probably closer to 75k this year as we are planning a pretty unmustachian wedding currently, so the costs may go down after June.
That being said we pull in around 220k, so we save quite a bit a year anyway (80k to 110k yearly) (Taxes are quite a bit 60k->80k)
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To those who think, referring to taxes, "that money was never yours to begin with" - whose money was it?
Taxes absolutely are an adjustable expense. E.g., you can choose to live where property taxes are high or low. You can also choose to live in states and cities that have income taxes or not.
There is even legal precedent: "Any one may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one's taxes." - Learned Hand.
You can certainly manipulate your tax liability to an extent. But that's just it - "to an extent." After moving to a no income tax state and maxing out your retirement accounts, there's really not much more you can do. Well okay you can do many things to reduce your tax bill but increase your overall expenses (ie, have kids and get a child tax credit).
Whose money was it? The government's.
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You're very cavalier...
You may choose to read that into what I wrote, but you would be inferring too much. johnny847's reply is closer.
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You can certainly manipulate your tax liability to an extent. But that's just it - "to an extent." After moving to a no income tax state and maxing out your retirement accounts, there's really not much more you can do. Well okay you can do many things to reduce your tax bill but increase your overall expenses (ie, have kids and get a child tax credit).
Agreed.
Whose money was it? The government's.
I don't want to put words into your mouth, so I'll ask instead of assume: does this mean you believe "From each according to his ability, to each according to his need" is a proper philosophy?
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I spend about $12,000 a year and I have a fancy pants life. I'm currently renting an apartment in the trendy Alphabet District near downtown Portland, albeit it's a studio, and I split the cost + space with my partner. I drink a green smoothie for breakfast every day. We treat ourselves once a month to an amazing meal at a highly rated or James Beard award winning chef-run restaurant, but don't eat out at all otherwise.
My employer pays my health insurance premiums, and that's a big part of how I keep my expenses low. I also tend to take one international trip per year using credit card points for the free flight, and using AirBnB for budget accommodation.
That figure obviously doesn't include unexpected costs like veterinarian visits or car repairs.
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Whose money was it? The government's.
I don't want to put words into your mouth, so I'll ask instead of assume: does this mean you believe "From each according to his ability, to each according to his need" is a proper philosophy?
I don't think it's fair to take (1) "the government needs to levy funds from the populace in order to function" and twist it into (2) full-fledged socialism. They are not the same thing, so it's illogical to assume that someone who believes (1) must believe (2). I can't quite believe I need to spell this out.
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Another thing that boggles my mind, are the people who spend $300+ per couple on food, and think it is normal.
Maybe it is normal, but averaging $150 per person, per month, is a lot to me.
What are you eating?
Are you eating mostly processed stuff or are you buying fresh ingredients and preparing your own meals?
$150/person a month is absolutely do-able, and probably not even all that extreme. But something my wife has noticed in a lot of YouTube videos she's watched that are about saving the maximum amount of money is that they're eating garbage.
We buy very little processed or frozen food. We buy reduced foods and specials, and stock up. My husband is 6'-200 lbs and I'm 5'1-112 lbs (approx) We waste very little food, and anything that does spoils, we toss to the chickens. We eat meat every day.Our budget averages $50 a week, total for the 2 of us. This also includes all toiletries and paper products we buy.
The below response is a copy & paste from another thread, where we were having a discussion about groceries.
Halfway through the month and we've spent 108.83
Dairy: 17.7%.................19.25
Meat/Eggs: 30.6%................33.37
Bread: 4.8 %..................5.31
Fruits/Veg: 28.5%............... .31.11
Oil/Fat: 2%.....................2.25
Baking/Nuts: 4.5 %.................4.95
Condiments: 1.8 %................1.99
Non-Food: 5.9 %.................6.49
Drinks: 0
Canned: 2%......................2.23
Junk Food: 1.7 % ...............1.88
*Australian family of 2
Just finished the shopping for the week
..grand total for the month so far (including eating out and alcohol..which equals $0) is $184.52
just to show what we bought...
5kg potatoes- $6.99
500g margarine @$.99 x 2= $1.98
3L milk- $3.00
lettuce-$.99
250g strawberries- $3.99
avocado-$1.99
.75kg bananas- $1.40
2kg sweet potatoes-$3.89
500g mushrooms(reduced)-2.99
crumpets- $1.19
700gr bread 4@ $.85= $3.40
avocado=$1.99
1 kg carrots-$1.69
1kg margarine- $1.59
1.5 kg whole chicken- $5.49
2.096 kg ground beef- $12.56
3L milk- $2.99
750g corn flakes- $2.69
100g rice crackers 2@ $0.89 = $1.78
320g cranberry chutney =$2.69
500g ginger marmalade= $1.45
425g baked beans 2 @ $0.69 = $1.38
corn starch- $1.39
sesame snaps- $1.49
1L UHT milk-$0.95
250g strawberries- $3.49
: $34.85 this trip + $184.52= $219.37 for the month. (averaged out is $50.62 week for 2 people)
This also includes our $0.00 for eating out and alcohol.
This is what we bought this week
3L milk- $3.00
2L strawberry milk $5.99 (reduced)- $3.99
600 ml cream- $2.30
500g salt- $0.89
500g icing sugar- $1.54
200g tzatziki dip $2.79 (reduced)-$0.99
1 kg basa fish fillets- $6.98
1 kg puff pastry sheets- $2.70
250g strawberries- $2.99
125g x 2 raspberries $6.98 (reduced)-$6.00
mango-$2.49
18g ground cinnamon- $0.99
We still have so much food left over.
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Whose money was it? The government's.
I don't want to put words into your mouth, so I'll ask instead of assume: does this mean you believe "From each according to his ability, to each according to his need" is a proper philosophy?
I don't think it's fair to take (1) "the government needs to levy funds from the populace in order to function" and twist it into (2) full-fledged socialism. They are not the same thing, so it's illogical to assume that someone who believes (1) must believe (2). I can't quite believe I need to spell this out.
Well said Cressida.
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I don't think it's fair to take (1) "the government needs to levy funds from the populace in order to function" and twist it into (2) full-fledged socialism. They are not the same thing, so it's illogical to assume that someone who believes (1) must believe (2). I can't quite believe I need to spell this out.
I quite agree that it would not be fair to assume (1) implies (2) - no argument.
But (1) is quite different from "the money was never yours to begin with because it was the government's". That implies one's earnings are at the whim of a controlling government, rather than "governments...deriving their just powers from the consent of the governed."
If we are all saying that some amount of taxation is needed to provide for common needs, and that individuals have primary influence over their own outcomes by virtue of their own actions, then we all agreed - correct?
We may not agree on exact role of government, and thus the specific amount/percentage of tax expense one should have to pay, but that would be a thread of its own....
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I live reasonably well on R6000 / $600 p/m - with house paid off and bills split with my wife. Tried doing it on $500 for the last 6 months and it just wasn't enough to cover the odd unbudgeted for bill. Like this month I was heading for a bit of a surplass to chuck into a new TV and holiday - and found I need a new battery for my car. Oh well.
Food costs looks to be slightly cheaper than OZ here in South Africa - say 20%
Most would laugh at me for suggesting I can live on $600 here - a friend pays $600 p/m to send his two kids to an decent/ middle of the road private school - excluding extra's.
I live well enough that we go on a bike ride every Sunday and have breakfast as well as a night to the theatre/ show once a month.
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To those who think, referring to taxes, "that money was never yours to begin with" - whose money was it?
Taxes absolutely are an adjustable expense. E.g., you can choose to live where property taxes are high or low. You can also choose to live in states and cities that have income taxes or not.
There is even legal precedent: "Any one may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one's taxes." - Learned Hand.
Absolutely this.
And I'll tell you something. It IS my money. The government can take it, if push comes to shove, but so could a thug with a gun. At least if the thug manages to catch me by surprise. Luckily, it's harder for the guv'mint to surprise anyone as far as what taxes they intend to take. One just has to be as smart as possible about dealing with that.
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To those who think, referring to taxes, "that money was never yours to begin with" - whose money was it?
Taxes absolutely are an adjustable expense. E.g., you can choose to live where property taxes are high or low. You can also choose to live in states and cities that have income taxes or not.
There is even legal precedent: "Any one may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one's taxes." - Learned Hand.
Absolutely this.
And I'll tell you something. It IS my money. The government can take it, if push comes to shove, but so could a thug with a gun. At least if the thug manages to catch me by surprise. Luckily, it's harder for the guv'mint to surprise anyone as far as what taxes they intend to take. One just has to be as smart as possible about dealing with that.
" It IS my money" - maybe for the next 2 weeks at most ( plus the possibility of interest) . Why do people insist on been so deluded when it comes to Tax, if you have a tax liability come April 15th - that is the goverments money - end of story.
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For a soon-to-be family of 3 (infant coming soon!):
I did not include healthcare in our budget, this adds about $130 a month, comes out pretax through employer:
Projected: $2500 per month or $30,000 per year. This covers rent, utilities, food, insurance, SL minimum payment, phone, car expenses, small buffer. This also includes some luxuries such as vacation (camping, car trips, maybe a flight next year), and a fluffier grocery/take-out expense than necessary.
Barebones: $1900 a month or $22,800.
Just as others here have said, we don’t feel like we are deprived or missing out on anything with this budget. We have some flexibility to increase the budget if needed, but are trying to concentrate on paying off SL and saving for a down payment. I want to be more of a badass with our grocery spending, but it’s so hard!
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To those who think, referring to taxes, "that money was never yours to begin with" - whose money was it?
Taxes absolutely are an adjustable expense. E.g., you can choose to live where property taxes are high or low. You can also choose to live in states and cities that have income taxes or not.
There is even legal precedent: "Any one may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one's taxes." - Learned Hand.
Absolutely this.
And I'll tell you something. It IS my money. The government can take it, if push comes to shove, but so could a thug with a gun. At least if the thug manages to catch me by surprise. Luckily, it's harder for the guv'mint to surprise anyone as far as what taxes they intend to take. One just has to be as smart as possible about dealing with that.
" It IS my money" - maybe for the next 2 weeks at most ( plus the possibility of interest) . Why do people insist on been so deluded when it comes to Tax, if you have a tax liability come April 15th - that is the government's money - end of story.
No. It is YOUR money being taken from you. Or, if it makes you feel better, it is your money which you are exchanging for the benefits and advantages of being able to live in an orderly and organized society.
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Or, if it makes you feel better, it is your money which you are exchanging for the benefits and advantages of being able to live in an orderly and organized society.
well ... yeah?
Technically, yes, it's your money. If employer withholding weren't so pervasive, we would all be paid gross wages and then literally have to turn around and pay money to the government (as many do, notably the self-employed). Maybe then we would be more likely to see taxes as "our" money.
But really - what good does that do? If you have two options, and one is to be resigned to the fact that the government uses part of your official wages in order to run the state, and the other is to be in a state of perpetual outrage about it, why would you choose the latter?
OK, "Perpetual outrage" is something of an exaggeration, but my point is, isn't it less heart-attack-inducing to just think of that money as belonging to the government from the beginning? Minimize their share to the extent that you can, but begrudging the remainder just seems like a pointless waste of energy.
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theoretically £6k a year. though i live with my mum and dad so i don't pay much for anything right now. i did make an expenses spreadsheet with overestimates.
£3k a year if i didn't have to pay mortgage bills
once can hope :)
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Or, if it makes you feel better, it is your money which you are exchanging for the benefits and advantages of being able to live in an orderly and organized society.
well ... yeah?
...isn't it less heart-attack-inducing to just think of that money as belonging to the government from the beginning? Minimize their share to the extent that you can, but begrudging the remainder just seems like a pointless waste of energy.
It's neither pointless nor a waste of time to me. And it's not outrage, it's conviction.
Well... I was going to now go and write out a long-winded response; but you know what? This is neither the thread nor the venue for such political-philosophical debates. So how about it if I just respectfully refuse to agree with you and we leave it at that. You can do the same.