Poll

What's your annual spend in FIRE?

25K
35K
45K
55K
65K
85K
100K+
150K+
Not FIRE'd so people can see results

Author Topic: Annual Spend?  (Read 7528 times)

Rdy2Fire

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Annual Spend?
« on: May 10, 2020, 08:33:38 AM »
My FIRE, or RE, was somewhat unplanned earlier/younger then I thought. I still not sure about future work as I know my numbers and believe I have enough. I am also still not sure what to do with time actually so not sure about future.

When I look at the numbers my thinking how much does one really need or use per year once FIRE'd. I was interested to the level of where people are but know some don't want to share details; a so I made it a poll. It's not one size fits all obviously but people can add detail in responses if they like..

I should note I live in a HCOL area am single, no kids, travel often (not now) and could cut my spend. Feel free to vote and add details or ask questions.

ol1970

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Re: Annual Spend?
« Reply #1 on: May 10, 2020, 08:48:36 AM »
Do you hate the profession you have chosen to be in?  If you have no clue how youíd want to spend your time youíll be miserable, and judging by your annual spending options in the poll, youíll probably be constantly worried about finances over the next 2-3 years while we meander our was through a significant recession.  Split the middle and find a gig that you enjoy even if it doesnít pay much, work less hours, exercise, and develop some hobbies/interests.  My spend target is $180k, but end up spending a lot less, closer to $120k, but I do believe you can be happy with any of the target above $40k/year if your interests donít involve travel, or really expensive gear that needs replacing or maintained often.  Those are currently  the main drivers in my burn rate.

Rdy2Fire

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Re: Annual Spend?
« Reply #2 on: May 10, 2020, 09:04:26 AM »
Do you hate the profession you have chosen to be in?  If you have no clue how youíd want to spend your time youíll be miserable, and judging by your annual spending options in the poll, youíll probably be constantly worried about finances over the next 2-3 years while we meander our was through a significant recession.  Split the middle and find a gig that you enjoy even if it doesnít pay much, work less hours, exercise, and develop some hobbies/interests.  My spend target is $180k, but end up spending a lot less, closer to $120k, but I do believe you can be happy with any of the target above $40k/year if your interests donít involve travel, or really expensive gear that needs replacing or maintained often.  Those are currently  the main drivers in my burn rate.

I am no longer in a profession so currently I've chosen not to be in one.

I chose the number range because of what i see here, there are folks saying they spend less then 25K which for me seems crazy but I live in a different place and do different things. As for my choice it was 55K. I'm not worried about money currently and based on my portfolio could spend more but that's what I have figured to be my spend (actually less).

Maybe it wasn't clear my question wasn't a target spend I could target to spend 300K. I could certainly change the options but my impression was that most people were in the under 100K range based on things I've read here; sounds like your spend is 120K

I went back to add a couple other options but based on those that voted (I am guessing you were the previous top vote) all were under 65K
« Last Edit: May 10, 2020, 09:07:27 AM by Rdy2Fire »

secondcor521

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Re: Annual Spend?
« Reply #3 on: May 10, 2020, 12:14:58 PM »
I voted in the poll based on my actual core spending, which excludes what I pay for child support (because it's ending this month) and what I pay for college (because I'm about 5/12 of the way through those expenses and I've got the money saved for them in a separate bucket).

What my number is shouldn't really matter.  What should matter is what things tend to be FIRE cost drivers and how to determine what you actually spend.

The latter is easy, so I'll just address that first.  Use Quicken and track every penny for three years, then consider sinking funds for large periodic expenses that didn't happen in those three years - new car, new roof, etc.  Perhaps insure against big medical risks (LTC, health insurance) if appropriate.

The FIRE cost drivers that I see most often:

1.  Living in an HCOL.  Manhattan is way more expensive than Oklahoma city.  If you want to live in a LCOL area, move  50 miles away from any large bodies of water.
2.  Married vs. single.  The cost multiplier here seems to be about 1.5 on average.
3.  Children in college that you decide to pay for.  Currently this is 43% of my spending over the past six months.
4.  Travel.  Can be expensive depending on how you do it.
5.  Health insurance.  If you don't qualify for ACA and are past 50, it'll probably be expensive.
6.  Mortgage.  Some people go for the mortgage arbitrage and get big, long mortgages, with their associated monthly payments.  I understand the strategy and think it makes sense for many people, but have chosen not to follow it personally.

Occasionally people have expensive hobbies, like boats, planes, or horses, but that's not really that common to my knowledge.  People either don't feel the need, or they scratch the itch, or it's too expensive to maintain.

The above items can mean the difference between ~$25K and ~$150K.

ender

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Re: Annual Spend?
« Reply #4 on: May 10, 2020, 12:43:09 PM »
Can you add a "Not FIREd, want to see poll results" option? :-)

2Birds1Stone

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Re: Annual Spend?
« Reply #5 on: May 10, 2020, 12:47:48 PM »
I voted for $25k since you didn't create an option for anything lower.

FIRE'd last October and annualized spend is currently ~$15-18k/yr thanks to geographical arbitrage. Over the past 5 years it averaged closer to $20-25k though. Since you are single, this is my individual spend.

As a couple, my wife and I are currently @ $28-30k/yr and averaged closer to $39-44k/yr whilst we were working.

We are 33 and 29 years old, and may return to work to beef up the portfolio a bit if our wants/needs change.

Rdy2Fire

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Re: Annual Spend?
« Reply #6 on: May 10, 2020, 01:54:56 PM »
Can you add a "Not FIREd, want to see poll results" option? :-)

DONE!!

Rdy2Fire

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Re: Annual Spend?
« Reply #7 on: May 10, 2020, 01:58:49 PM »
I voted for $25k since you didn't create an option for anything lower.

FIRE'd last October and annualized spend is currently ~$15-18k/yr thanks to geographical arbitrage. Over the past 5 years it averaged closer to $20-25k though. Since you are single, this is my individual spend.

As a couple, my wife and I are currently @ $28-30k/yr and averaged closer to $39-44k/yr whilst we were working.

We are 33 and 29 years old, and may return to work to beef up the portfolio a bit if our wants/needs change.

Sorry I didn't know where to start and end I figured there may be people under 25K and people MUCH higher then my original top (I added more options) of 65K+

I was really just trying to get an idea of peoples spend as it's something I think about and consider when I look at where to move eventually. I can afford where I am just think it makes sense to go to a LCOL (or lower) possibly even not own again

15-18K a year is amazing, and you're quite young as well, mind if I ask where you're located?

flyingaway

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Re: Annual Spend?
« Reply #8 on: May 10, 2020, 02:11:03 PM »
I am FI, but not retired yet. I voted for $85K, but our target spending is probably between $90K and $100K. This is for a couple, with the intention to support children in the future if needed.
We like spending money on travel, casinos, food, etc. If we are in a really bad situation, we may be able to survive on $40K per year with a smaller house.

NotJen

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Re: Annual Spend?
« Reply #9 on: May 10, 2020, 02:25:34 PM »
I didn't vote - this is my first year FIREd, and my budget is $24k (single person).  My final year of working, I spent $25.5k.  Right now, I'm spending under target (thanks, pandemic!).  My budget is based on everything going well, and does not include expenses like major car or home repair, or more than basic medical expenses - but I do have wiggle room in savings to cover those if they happen.  I probably won't stay unemployed forever, though the numbers indicate I might be able to if my spending stays at this relative level.

Rdy2Fire

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Re: Annual Spend?
« Reply #10 on: May 10, 2020, 02:30:24 PM »
I didn't vote - this is my first year FIREd, and my budget is $24k (single person).  My final year of working, I spent $25.5k.  Right now, I'm spending under target (thanks, pandemic!).  My budget is based on everything going well, and does not include expenses like major car or home repair, or more than basic medical expenses - but I do have wiggle room in savings to cover those if they happen.  I probably won't stay unemployed forever, though the numbers indicate I might be able to if my spending stays at this relative level.

Same here on 1st year 24K is low and awesome; what area of the world or US are you in?

2Birds1Stone

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Re: Annual Spend?
« Reply #11 on: May 10, 2020, 02:33:03 PM »
I was really just trying to get an idea of peoples spend as it's something I think about and consider when I look at where to move eventually. I can afford where I am just think it makes sense to go to a LCOL (or lower) possibly even not own again

15-18K a year is amazing, and you're quite young as well, mind if I ask where you're located?

We have been in Portugal for the past two months, until June 7th. From June-Sept/Oct we will be staying in Poland where most of my family lives. Both are LCOL areas. Our current fully furnished/kitted out 1.5 bath apartment is $770/month ($385/each) through AirBnB, so all utilities included. In Poland we will do some AirBnB's, camping, and stay with family. In the fall we may do WOOFing or WorkAway.

Financial.Velociraptor

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Re: Annual Spend?
« Reply #12 on: May 10, 2020, 02:42:05 PM »
Consistently under 25k since 2012 ER.  Targeting 18k this year as portfolio to a COVID-19 hit.

jim555

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Re: Annual Spend?
« Reply #13 on: May 10, 2020, 05:11:08 PM »
Past 5 years around $16K.

NotJen

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Re: Annual Spend?
« Reply #14 on: May 10, 2020, 05:21:53 PM »
I didn't vote - this is my first year FIREd, and my budget is $24k (single person).  My final year of working, I spent $25.5k.  Right now, I'm spending under target (thanks, pandemic!).  My budget is based on everything going well, and does not include expenses like major car or home repair, or more than basic medical expenses - but I do have wiggle room in savings to cover those if they happen.  I probably won't stay unemployed forever, though the numbers indicate I might be able to if my spending stays at this relative level.

Same here on 1st year 24K is low and awesome; what area of the world or US are you in?
I'm in the Southeast US.  With a paid-off house.

FreshlyFIREd

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Re: Annual Spend?
« Reply #15 on: May 11, 2020, 01:32:24 AM »
I am 60,  Annual spend = $135K, this is 3.25% of nest egg. I have zero debt, and own house, etc. I can live on less, but I can't take it with me.

My problem now is: I can't travel because of pandemic - so I probably can't even spend the $135K until traveling becomes safe.

blue_green_sparks

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Re: Annual Spend?
« Reply #16 on: May 11, 2020, 07:21:29 AM »
Fortunately we have learned that our happiness and wellness indices do not seem to be highly correlated with our annual spend. In some strange unexpected twist there could actually be a bit of a negative correlation, LOL.

2Birds1Stone

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Re: Annual Spend?
« Reply #17 on: May 11, 2020, 09:05:14 AM »
Past 5 years around $16K.

That's very impressive! Paid off home?

Rdy2Fire

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Re: Annual Spend?
« Reply #18 on: May 11, 2020, 09:12:48 AM »
Past 5 years around $16K.

That's very impressive! Paid off home?

AGREED!! that is impressive and my home is paid off but in a HCOL my real estate taxes are 3/4 of that yearly spend; crazy

Malcat

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Re: Annual Spend?
« Reply #19 on: May 11, 2020, 09:23:15 AM »
As has already been said, what other people spend is virtually irrelevant.

Some people keep a mortgage in retirement, some people pay for kid's education, some people have expensive chronic health issues, some people stay in VHCOL areas to be near grandkids, some people take up expensive hobbies.

There are so many things that can balloon an annual spend well beyond indicating the basic quality of life the person is living. So numbers are practically meaningless.

If someone has very low core expenses, then even a modest 30K spend could involve a lot of luxury. Meanwhile, if someone has high fixed costs, then even 60K might feel tight and constrained.

You need to figure out what you want your core expenses to look like, and then you need to figure out how much wiggle room you want on top of that. For us, we're all about the wiggle room. Our core expenses are pretty low, but our retirement budget is double that so that we have ample room for added luxury. However, our actual numbers are virtually meaningless to you unless you live the same basic lifestyle as we do.
« Last Edit: May 11, 2020, 11:23:46 AM by Malkynn »

herbgeek

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Re: Annual Spend?
« Reply #20 on: May 11, 2020, 09:45:26 AM »
I answered with our family spending (last year it was just under 45K)  Were you intending people to answer this with a per person figure?

jim555

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Re: Annual Spend?
« Reply #21 on: May 11, 2020, 10:50:46 AM »
Past 5 years around $16K.

That's very impressive! Paid off home?
Condo and car owned outright.

Rdy2Fire

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Re: Annual Spend?
« Reply #22 on: May 11, 2020, 11:45:45 AM »
As has already been said, what other people spend is virtually irrelevant.

Some people keep a mortgage in retirement, some people pay for kid's education, some people have expensive chronic health issues, some people stay in VHCOL areas to be near grandkids, some people take up expensive hobbies.

There are so many things that can balloon an annual spend well beyond indicating the basic quality of life the person is living. So numbers are practically meaningless.

If someone has very low core expenses, then even a modest 30K spend could involve a lot of luxury. Meanwhile, if someone has high fixed costs, then even 60K might feel tight and constrained.

You need to figure out what you want your core expenses to look like, and then you need to figure out how much wiggle room you want on top of that. For us, we're all about the wiggle room. Our core expenses are pretty low, but our retirement budget is double that so that we have ample room for added luxury. However, our actual numbers are virtually meaningless to you unless you live the same basic lifestyle as we do.

Yes all accurate it was more curiosity as based on other threads this seems to be an ongoing question as to what people actually spend not necessarily the 3% or 4% rule. Hence why I was hoping people would add some commentary which they have.

I've stated what i spent my 1st year but I also plan to leave a HCOL area for a lower one or an international one, in the next few years.

Monkey Uncle

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Re: Annual Spend?
« Reply #23 on: May 11, 2020, 01:22:43 PM »
I answered 25k because it sounds like you are looking at single person expenses.  DW and I are actually quite a bit under that on basic expenses, which look to come in at about 35k for both of us this year (so about 17.5k on an individual basis).  We spent way more than that last year due to travel and a vehicle replacement.  This year is low because we're staying put due to COVID.  I'm guessing a "normal" year for us would be around 45k, so still under 25k per person.

Malcat

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Re: Annual Spend?
« Reply #24 on: May 11, 2020, 02:00:41 PM »
As has already been said, what other people spend is virtually irrelevant.

Some people keep a mortgage in retirement, some people pay for kid's education, some people have expensive chronic health issues, some people stay in VHCOL areas to be near grandkids, some people take up expensive hobbies.

There are so many things that can balloon an annual spend well beyond indicating the basic quality of life the person is living. So numbers are practically meaningless.

If someone has very low core expenses, then even a modest 30K spend could involve a lot of luxury. Meanwhile, if someone has high fixed costs, then even 60K might feel tight and constrained.

You need to figure out what you want your core expenses to look like, and then you need to figure out how much wiggle room you want on top of that. For us, we're all about the wiggle room. Our core expenses are pretty low, but our retirement budget is double that so that we have ample room for added luxury. However, our actual numbers are virtually meaningless to you unless you live the same basic lifestyle as we do.

Yes all accurate it was more curiosity as based on other threads this seems to be an ongoing question as to what people actually spend not necessarily the 3% or 4% rule. Hence why I was hoping people would add some commentary which they have.

I've stated what i spent my 1st year but I also plan to leave a HCOL area for a lower one or an international one, in the next few years.

I'm confused, what is the ongoing question you are seeing in other threads?

Yes, people are constantly wondering what other people spend, but that doesn't take away from that data being virtually useless on its own.


Rdy2Fire

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Re: Annual Spend?
« Reply #25 on: May 11, 2020, 08:27:50 PM »
As has already been said, what other people spend is virtually irrelevant.

Some people keep a mortgage in retirement, some people pay for kid's education, some people have expensive chronic health issues, some people stay in VHCOL areas to be near grandkids, some people take up expensive hobbies.

There are so many things that can balloon an annual spend well beyond indicating the basic quality of life the person is living. So numbers are practically meaningless.

If someone has very low core expenses, then even a modest 30K spend could involve a lot of luxury. Meanwhile, if someone has high fixed costs, then even 60K might feel tight and constrained.

You need to figure out what you want your core expenses to look like, and then you need to figure out how much wiggle room you want on top of that. For us, we're all about the wiggle room. Our core expenses are pretty low, but our retirement budget is double that so that we have ample room for added luxury. However, our actual numbers are virtually meaningless to you unless you live the same basic lifestyle as we do.

Yes all accurate it was more curiosity as based on other threads this seems to be an ongoing question as to what people actually spend not necessarily the 3% or 4% rule. Hence why I was hoping people would add some commentary which they have.

I've stated what i spent my 1st year but I also plan to leave a HCOL area for a lower one or an international one, in the next few years.

I'm confused, what is the ongoing question you are seeing in other threads?

Yes, people are constantly wondering what other people spend, but that doesn't take away from that data being virtually useless on its own.

The ongoing is people , myself included, seem to be interested in yearly spend. Tons of factors influence that spend obviously but polls don't allow for that hence the discussion. I spent my career or former career in the world of data and nothing, data wise, is useless unless you just don't care. Maybe you don't but I did and have seen others asking similar type questions so maybe they did.  I've already learned some things from this maybe you, and others haven't.

2Birds1Stone

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Re: Annual Spend?
« Reply #26 on: May 11, 2020, 11:42:32 PM »
I care too, OP. I wager many others do too.

Malcat

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Re: Annual Spend?
« Reply #27 on: May 12, 2020, 05:28:11 AM »
As has already been said, what other people spend is virtually irrelevant.

Some people keep a mortgage in retirement, some people pay for kid's education, some people have expensive chronic health issues, some people stay in VHCOL areas to be near grandkids, some people take up expensive hobbies.

There are so many things that can balloon an annual spend well beyond indicating the basic quality of life the person is living. So numbers are practically meaningless.

If someone has very low core expenses, then even a modest 30K spend could involve a lot of luxury. Meanwhile, if someone has high fixed costs, then even 60K might feel tight and constrained.

You need to figure out what you want your core expenses to look like, and then you need to figure out how much wiggle room you want on top of that. For us, we're all about the wiggle room. Our core expenses are pretty low, but our retirement budget is double that so that we have ample room for added luxury. However, our actual numbers are virtually meaningless to you unless you live the same basic lifestyle as we do.

Yes all accurate it was more curiosity as based on other threads this seems to be an ongoing question as to what people actually spend not necessarily the 3% or 4% rule. Hence why I was hoping people would add some commentary which they have.

I've stated what i spent my 1st year but I also plan to leave a HCOL area for a lower one or an international one, in the next few years.

I'm confused, what is the ongoing question you are seeing in other threads?

Yes, people are constantly wondering what other people spend, but that doesn't take away from that data being virtually useless on its own.

The ongoing is people , myself included, seem to be interested in yearly spend. Tons of factors influence that spend obviously but polls don't allow for that hence the discussion. I spent my career or former career in the world of data and nothing, data wise, is useless unless you just don't care. Maybe you don't but I did and have seen others asking similar type questions so maybe they did.  I've already learned some things from this maybe you, and others haven't.

Oh, I know people often ask this, but it always quickly becomes apparent that there are huge confounding factors at play. I think it might be interesting to ask "what is your annual spend, and what is the biggest factor in that spend?"

Rdy2Fire

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Re: Annual Spend?
« Reply #28 on: May 12, 2020, 07:56:21 AM »
I care too, OP. I wager many others do too.

Yeah as Malkynn points out there are, of course, other factors but I think it's still interesting to see/read peoples responses


Oh, I know people often ask this, but it always quickly becomes apparent that there are huge confounding factors at play. I think it might be interesting to ask "what is your annual spend, and what is the biggest factor in that spend?"


Exactly people ask. Yes there are tons of factors. I mean I'd like to know many thing, biggest factor which may also play into where they live, if they are married, have a SO, single, kids etc.

Lots of questions for sure but was just asking the basic in hopes it would spark form conversation(s). Maybe even give others, like myself, some more insight into what people spend and some of those other questions.

bmjohnson35

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Re: Annual Spend?
« Reply #29 on: May 12, 2020, 09:05:38 AM »

We budgeted $36k for 2020, but will likely be closer to $30k, since our vacation plans have been impacted.  Traveling accounts for around 1/3rd of our annual budget.  Since this is the first year that both of us are retired, this will be the first time living without relying on traditional income.  Therefore, our actual spending may vary a bit.  We live in LCOL area and we are debt free.  We own 2 cars and one motorcycle.  Our home and vehicles are all insured. We don't eat out much (once or twice a week at most) and we do not participate in any high cost hobbies and/or sports. We live somewhat frugally and even our travel is value minded.

BJ

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Re: Annual Spend?
« Reply #30 on: May 12, 2020, 01:01:17 PM »
Not FIRE'd (yet) but spend ~$80K annually.

Car Jack

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Re: Annual Spend?
« Reply #31 on: May 14, 2020, 07:23:52 AM »
I can see how this can easily be all over the map.

Is this per family or per person or what? 

How are you people including future college expenses for kids, if that's your situation?  Yah, I know the Boglehead way is to say "let those useless kids pay their own way, I got retirement to pay for and nobody loans for retirement, get off my lawn".  But for kids to have an even footing, they're going to need help paying for college.  This isn't 1975, when community college was $200 a semester and a part time job easily cleared $100 a week (real numbers from when I paid my own way through community college).  I know that college costs really screw up an average spending number, making it skyrocket during college years, then drop like a rock afterwards.

For some level setting, I spent about $300k for DS#1's college.  He just finished his last course and should have a diploma any day now.  Job is secured and start date imminent.  DS#2 has lots in his "college fund" account from grandparents and gifts and can pay for at least one more full year and then some.  Even then, there are certainly costs.  A car for the 15 mile commute and food and books and such.  Mouse turds compared to the private college, on campus cost for DS#1.

Anyways, I keep pretty good track.  Ignoring college, our family spends right about $56k a year.  Paid off everything long ago.  5 cars out there.  Pretty much, they're all just sitting. 

blue_green_sparks

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Re: Annual Spend?
« Reply #32 on: May 14, 2020, 09:21:49 AM »
That is NOT a normal distribution, LOL. Bimodal...LO and HI centroids?

Monkey Uncle

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Re: Annual Spend?
« Reply #33 on: May 14, 2020, 06:18:11 PM »
I can see how this can easily be all over the map.

Is this per family or per person or what? 

How are you people including future college expenses for kids, if that's your situation?  Yah, I know the Boglehead way is to say "let those useless kids pay their own way, I got retirement to pay for and nobody loans for retirement, get off my lawn".  But for kids to have an even footing, they're going to need help paying for college.  This isn't 1975, when community college was $200 a semester and a part time job easily cleared $100 a week (real numbers from when I paid my own way through community college).  I know that college costs really screw up an average spending number, making it skyrocket during college years, then drop like a rock afterwards.

For some level setting, I spent about $300k for DS#1's college.  He just finished his last course and should have a diploma any day now.  Job is secured and start date imminent.  DS#2 has lots in his "college fund" account from grandparents and gifts and can pay for at least one more full year and then some.  Even then, there are certainly costs.  A car for the 15 mile commute and food and books and such.  Mouse turds compared to the private college, on campus cost for DS#1.

Anyways, I keep pretty good track.  Ignoring college, our family spends right about $56k a year.  Paid off everything long ago.  5 cars out there.  Pretty much, they're all just sitting.

I solved the college problem by having my kid when I was young and then retiring after he had finished college.  But of course people aiming to retire before their late 40s don't have that option.

Monkey Uncle

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Re: Annual Spend?
« Reply #34 on: May 14, 2020, 06:23:00 PM »
I answered 25k because it sounds like you are looking at single person expenses.  DW and I are actually quite a bit under that on basic expenses, which look to come in at about 35k for both of us this year (so about 17.5k on an individual basis).  We spent way more than that last year due to travel and a vehicle replacement.  This year is low because we're staying put due to COVID.  I'm guessing a "normal" year for us would be around 45k, so still under 25k per person.

Just to give a little more context: LCOL area, expenses include a mortgage payment (though not a huge one), ACA health insurance with premium tax credit pretty close to maxed out.  No kids at home.

spartana

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Re: Annual Spend?
« Reply #35 on: May 15, 2020, 08:50:31 AM »
Under $25k. Single person. No kids. No debt. Paid off house and low expenses. Low cost or free hobbies and travel style. Free/low cost medical thru the VA. Currently car-less but looking for a replacement and will pay cash. Basic expenses (food, shelter, utilities, taxes, repairs and maintenance, etc) run between $500-$1000/month. If you include discretionary stuff like travel etc it is higher.

My monthly spending varies a lot. Some months (like now) I'm not really doing anything that costs money so just spending a couple hundred (if you don't count annual expenses) for food and utilities.. Other months I might spend a couple of thousand because I'm travelling. It seems to average out to around $16k-$18k/year though. Sometimes more. My current total passive income is $30k/year because I though I'd be travelling a lot this year. Guess I was wrong!

ETA I live in HCOL coastal SoCal but got a great deal on a house that I paid cash for.
« Last Edit: May 15, 2020, 09:17:05 AM by spartana »

sui generis

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Re: Annual Spend?
« Reply #36 on: May 15, 2020, 02:58:42 PM »
My FIRE budget ends in a 0, so I had to choose between arbitrarily rounding up by 5k or down by 5k to answer the poll. 

65% of my budget is for travel, charitable donations and (because I don't have a paid off home and live in a VHCOL area) housing.  So those 3 variables, which truly are huge variables amongst us all (vs. say, groceries or whatever), make it hard to compare across situations.

spartana

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Re: Annual Spend?
« Reply #37 on: May 16, 2020, 12:53:50 PM »
Do you hate the profession you have chosen to be in?  If you have no clue how you’d want to spend your time you’ll be miserable, and judging by your annual spending options in the poll, you’ll probably be constantly worried about finances over the next 2-3 years while we meander our was through a significant recession.  Split the middle and find a gig that you enjoy even if it doesn’t pay much, work less hours, exercise, and develop some hobbies/interests.  My spend target is $180k, but end up spending a lot less, closer to $120k, but I do believe you can be happy with any of the target above $40k/year if your interests don’t involve travel, or really expensive gear that needs replacing or maintained often.  Those are currently  the main drivers in my burn rate.
Why can't a budget of $40k/year be enough for travel? Lots of people here find a way to make that happen on much less. My current FIRE income is around $30k/year, of that approx $10k/year covers my base expenses and the rest is just fluff to spend on whatever - like travel (or just saved for the future if not using - I rarely use the full amount). I believe the OP can easily travel on a $40k budget since his current expenses are very low.
« Last Edit: May 16, 2020, 12:57:39 PM by spartana »

Financial.Velociraptor

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Re: Annual Spend?
« Reply #38 on: May 16, 2020, 05:18:06 PM »
I just re-reviewed the results.  I'm astounded that 13 people are over 100k a year in spend.  I never even made 100k in a year.  What would I conceivably spend that kind of money on?!?

sparkytheop

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Re: Annual Spend?
« Reply #39 on: May 16, 2020, 05:34:45 PM »
I just re-reviewed the results.  I'm astounded that 13 people are over 100k a year in spend.  I never even made 100k in a year.  What would I conceivably spend that kind of money on?!?

I'm not FIREd yet, but my goal is to have at least $120k/year available to spend.  I live in a LCOL area, and my house would be paid off, so it would be a stretch after a lifetime of saving and living fairly frugally, but I'm up for the challenge!

I figure this will more than cover all travel needs, I can hire any and all work out, I won't worry about a budget, or how much groceries cost.  I'll pay for meals with family when we go out.  I want to be able to take my son and any future grandchildren, or friends' grandchildren, to the theater multiple times a year and make a big outing out of it. 

I also plan to make sure that I can cover live-in care if needed, or a very nice retirement/nursing home.  Two grandparents lived into their 90s (one side of family has lived into the 90s for at least the last 11 generations), and one set lived into their 80s.  I want to know I can be well taken care of without my son feeling any kind of financial burden, or worry of burden.

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Re: Annual Spend?
« Reply #40 on: May 16, 2020, 05:42:14 PM »
We just finished a deep dive on our 2019 FIRE budget. We're in an MCOL city with a mortgage. There's a couple of things I think are a little tricky with spending and budget reporting:
  • Pay off your mortgage, boom your reported spending drops dramatically (we analyzed it'd be a 24% cut)
  • We often "upgrade" (think of smartphones) annually, selling off the old item and subtracting the sale value from the cost of the replacement

For 1), it can make your spending appear a lot lower than some other comparative spending (or the reverse). Make sure to account for this if you're comparing to other FIRE'ers (like MMM or RootOfGood, or us!). For 2) I think there's room for debate on what's "proper". Certainly, it makes sense to adjust for upgrades in some fashion if you're simply swapping one item for another and accounting for the net difference. I think lots of folks often just report the old item's sale as "income" though. I added our result at just a little under $41k.
« Last Edit: October 14, 2020, 01:50:23 PM by Chris@TTL »

waltworks

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Re: Annual Spend?
« Reply #41 on: May 17, 2020, 10:26:28 AM »
We're at $45k but that includes expenses for 3 kids. I would guess we'd drop by $15k or so once they're all out of the house (maybe considerably more if we also downsize). But that's 17 years out, so I'll stick with the $45k number.

-W

MrThatsDifferent

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Re: Annual Spend?
« Reply #42 on: May 17, 2020, 03:29:19 PM »
Iím not FIREd but wanted to see results and Iím gobsmacked that there are 13 people with decidedly un-mustachian FIRE budgets, but power to you if youíve got the 25x expenses to pull off that! I thought aiming for $60k/yr as a safety net for a single person was extreme.

Rdy2Fire

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Re: Annual Spend?
« Reply #43 on: May 18, 2020, 07:23:23 AM »
We're at $45k but that includes expenses for 3 kids. I would guess we'd drop by $15k or so once they're all out of the house (maybe considerably more if we also downsize). But that's 17 years out, so I'll stick with the $45k number.

-W

That's pretty impressive for a family with 3 kids wow

waltworks

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Re: Annual Spend?
« Reply #44 on: May 18, 2020, 07:42:30 AM »
We're at $45k but that includes expenses for 3 kids. I would guess we'd drop by $15k or so once they're all out of the house (maybe considerably more if we also downsize). But that's 17 years out, so I'll stick with the $45k number.

-W

That's pretty impressive for a family with 3 kids wow

The oldest is only 8, so they will probably get somewhat more expensive (braces!) in a few years.

I mean, other than food, and occasional bike/ski gear, we just don't buy anything. It's not like, hard to do if you avoid the big obvious dumb stuff (ie cars, remodeling perfectly good kitchens/bathrooms, clothes, coffee/eating out constantly, etc).

-W

EscapeVelocity2020

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Re: Annual Spend?
« Reply #45 on: May 18, 2020, 09:32:06 AM »
By following the 4% SWR advice, I could spend 150k plus per year, but weíll probably stick to our $600/week lifestyle.  I imagine we will do one-off rentals that go over this (like a yacht, RV, and Air BnBís if travel comes back eventually), but 40k/yr with a paid off home is the most accurate answer to the poll.  But Iím not ER so I didnít vote. 

Financial.Velociraptor

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Re: Annual Spend?
« Reply #46 on: May 18, 2020, 10:06:06 AM »
@EscapeVelocity2020 you going to change your handle to EscapeVelocity2020+ if you don't ER by year end??  Haha.  Best laid plans, right?

MaybeBabyMustache

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Re: Annual Spend?
« Reply #47 on: May 18, 2020, 10:20:30 AM »
I just re-reviewed the results.  I'm astounded that 13 people are over 100k a year in spend.  I never even made 100k in a year.  What would I conceivably spend that kind of money on?!?

This wasn't my answer, but we live in a HCOL. If we plan to stay, property tax is over 1/3 of that. Factor in an expensive hobby (skiing, for us) & college expenses or a large family, & I can see it playing out.

ROF Expat

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Re: Annual Spend?
« Reply #48 on: May 18, 2020, 10:47:22 AM »
I just re-reviewed the results.  I'm astounded that 13 people are over 100k a year in spend.  I never even made 100k in a year.  What would I conceivably spend that kind of money on?!?

I think this quote and Spartana's earlier post are great examples of why Malkynn didn't think that other peoples' numbers were likely to be relevant for the OP's question on whether he/she can fire.  That said, they are also what makes this post interesting (at least to me).  Nobody can tell OP "how much" he/she should/will spend in FIRE, but plenty of posters here regularly show us how little is necessary to FIRE.  Plenty of posters here are covering all the necessities of life and enough luxuries (like travel) to make themselves happy on very small budgets.  My own budget is larger (because it can be), but this thread has been a great reminder that it doesn't have to be.  My spend is larger than some people here, but I doubt it generates a commensurately higher level of happiness. 

EscapeVelocity2020

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Re: Annual Spend?
« Reply #49 on: May 18, 2020, 11:52:58 AM »
@EscapeVelocity2020 you going to change your handle to EscapeVelocity2020+ if you don't ER by year end??  Haha.  Best laid plans, right?

@Financial.Velociraptor Indeed! 

But Mousie, thou art no thy-lane,
In proving foresight may be vain:
The best laid schemes oí Mice aní Men
          Gang aft agley,
Aní leaíe us nought but grief aní pain,
          For promisíd joy!

Good luck to you friend, the road ahead is not what was expected.