How much do you need to live?

[accolay]

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

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!

[Cassie]

It seems like there was another thread about that article.

[MoneyCat]

I live on $14,400 a year and I live very comfortably.  In fact, I would say my life is quite luxurious.

[Retired To Win]

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.

[Emilyngh]

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.

[Maxman]

My spouse and I are both retired and live in The Villages Florida. We spend about 50k per year. Lots of golf.

[MMMdude]

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.

[HappyMargo]

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!

[johnny847]

Hmm let's see. When I throw out school fees, travel budget, bicycle startup costs, gifts, charity..
$16665.69 last year. Rent being $11759.

[Middlesbrough]

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.

[Fodder]

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.

[netskyblue]

Under $20k/year, $9480 of which is rent.  I'm actually shooting for < $19k this year.

[Stachetastic]

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.)
 

[PatStab]

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.

[MMMdude]

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?

[schoopsthecat]

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?

[Two9A]

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%.

[Fodder]

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.

[clarkfan1979]

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.

[Middlesbrough]

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?

[capitalguy]

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!

[tarheeldan]

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.

[andreo01]

Hey all i am new on this forum. It is a good question. Well mine answer is For middle class person 5000$ per month.

[minority_finance_mo]

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...

[andy85]

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

[PencilThinStash]

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.

[minority_finance_mo]

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.

[Public Hermit]

about $17,000 per year.

[accolay]

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.

[BlueMR2]

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.

[TheFrugalFox]

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.

[johnny847]

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?

[coachese]

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.

[Cassie]

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.

[MrMoogle]

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 :)

[deborah]

Last year I spent $25,000 - but most of that was discretionary expenses, so I guess I actually need about $12,000.

[PatStab]

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.

[alsoknownasDean]

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.

[Abe]

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.

[stlbrah]

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

[sol]

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.

[deborah]

Heated leather seats!!!

[dmc]

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.

[2lazy2retire]

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.

[dude]

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.

[Bjorn]

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.

[Upstate NYer]

$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.

[Giro]

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!!!

[netskyblue]

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. 

[antarestar]

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