Monthly Budget 4,000??

P

phoenixbound

New Member
Location
MO
Hello everyone,

Great advice and tips here. About me. I am not retired yet, but I am very close to setting a date. I will be 67 in Nov, still working, am already collecting SSN and signed up for Medicare, I am also getting care as needed from the VA Health System, my wife is already retired, house and vehicles paid for, credit card not zero but manageable, we have a place in Kansas City, MO and a small place in Phoenix that we travel to in the winter, I travel for my job and it doesn't matter where I live as long as it is close to a major airport.

My brother is a Certified Financial Planner and we have been working through the financial planning aspect of retirement. He has told me and I believe it that the most important step in final retirement is to create a retirement monthly budget after some honest reflection about what you currently spend and what your future needs will be. I have been working on that. Funny thing he said was that quite often it comes to about $4,000 a month and sure enough that is pretty close to where I am at.

Anyone else go through this exercise and come to about the same conclusion? Just curious. I like my job and I not in a huge rush to leave, but retirement sounds better every day. Thanks everyone.
 

I find trying to project what you need vs what you have to actually work with is a waste of time. What good is coming up with a budget if your resources can’t support it.

Everything beyond a tent in a warm climate is a lifestyle want. We can modify our lifestyles to fit what we have .

my preference is to see what can my portfolio safely generate ,what our other income sources are and then mold the lifestyle to fit .

It it never makes much sense basing a budget around either a percentage of a working income that no longer exists or trying to determine a budget based on a lifestyle supported by a pay check or 2 .

i find it makes much more sense seeing what you have to work with then back in to the lifestyle to fit
 
The number is different for each of us.

My monthly expenses didn't change much when I retired. Work-related expenses, retirement savings and withholding taxes went down, the cost of health insurance went up.

I would encourage you to make sure that your retirement budget is brutally honest and comprehensive. Make sure it includes savings each month for repairs, replacements, emergencies, and a touch of luxury.

It is also good to live a little below your means to help deal with the inevitable increases in the cost of living as we get older.

Good luck!
 

The problem with the mantra live below your means is like most mantras it has no actionable meaning .

means changes . It changes with markets , interest rates , rising expenses and of course job loss,illness and divorce .

what matters is really the ratio of discretionary vs non discretionary spending. We can live the lifestyle we do here in queens and have quite a bit of flexibility in our spending if push came to shove,

but for the same budget we could live in Manhattan. But that would have very little place to cut back . So both are below our means but if push came to shove Manhattan consists of a lot less discretionary spending.

when it comes down to just what most of these mantras mean in life they sound good but end up really having little value
 
Seems a no brainer
Live within yer means

Mantra? pssssht
More like Credo

We don’t touch $1000/mo
Don’t even know what I’d do with it
I may buy gold, if anything

Been that way for pushing four years now
Heh, most folks here would think I live in extreme poverty

Well to do, for me, is having 14 cord of would stacked up for the next two winters
qE9bRpT.jpg


and living each moment in the comfort, joy and satisfaction of hard work...with my hands, gives us

WE8JEN9.png
 
Once of course you identify what your means is at any given moment of course .

the problem really is there is very little out there about how to spend . we have all sorts of investing information , rules for retirement draws , etc but very little on how to spend .

how much should be ear marked for the short term ? how much should be discretionary vs non discretionary , how much should a car budget be ? , a housing budget ? etc ec . all you ever see is live below your means , whatever that is supposed to mean .

fidelity has started to work in that direction and for a non retiree came up with about a 30% discretionary spending formula . DO YOU SEE HOW THAT BELOW IS VERY DIFFERENT THAN JUST SAYING LIVE BELOW YOUR MEANS WHICH IS NOT A PLAN AT ALL . there is nothing actually actionable in those words

i-5ZnDf42-S.png
 
Interesting. Don't know about you guys, but after retirement starts there will be no more deposits in retirement savings. That I do know for sure.
 
well there may not be deposits but there can certainly be dumping in extra money or the gains themselves still growing . this is our third year in retirement and we have been drawing out 6 figures to live . our balance is way higher today than the day we retired .

with some good basic investing you can grow your money in retirement passively letting your money work for you instead of of the younger days when you worked for your money .
 
phoenixbound said:
Interesting. Don't know about you guys, but after retirement starts there will be no more deposits in retirement savings. That I do know for sure.
Click to expand...

I haven't made any additional deposits into my retirement accounts since I stopped working in 2005, the balances continue to grow over time because I live below my means.

I have made other taxable investments/deposits since I retired, once a saver always a saver.
 
If you have a look further down this forum, a few weeks ago there was a discussion of Average retirement costs. I appreciate that costs in the UK are different to the US (especially in the case of medical and old age care), but the general consensus here was the equivalent of $35k to $50k USD.
So,not too far different to $4000 a month for a comfortable retirement.
 
we all earned very different amounts when we worked didn't we ? of course . we did and what we spent all depended on where we lived and the lifestyle choice we added in . more money usually means more or better lifestyle choices possible .

based on our rent in a rent stabilized building in queens in nyc and medical insurance / long term care insurance plus dental about 1/2 that 50k would be gone with nothing else in the picture . in fact more than 1/2 if we include taxes
i can see 50k per person in which case that would be 100k household income where we live , that would remove a lot of what we enjoy but we could do it . so the number of people is a factor too
 
mathjak107 said:
Once of course you identify what your means is at any given moment of course .

the problem really is there is very little out there about how to spend . we have all sorts of investing information , rules for retirement draws , etc but very little on how to spend .

how much should be ear marked for the short term ? how much should be discretionary vs non discretionary , how much should a car budget be ? , a housing budget ? etc ec . all you ever see is live below your means , whatever that is supposed to mean .

fidelity has started to work in that direction and for a non retiree came up with about a 30% discretionary spending formula . DO YOU SEE HOW THAT BELOW IS VERY DIFFERENT THAN JUST SAYING LIVE BELOW YOUR MEANS WHICH IS NOT A PLAN AT ALL . there is nothing actually actionable in those words

i-5ZnDf42-S.png
Click to expand...

math-

I’ve appreciated your views on finances in past posts

However, you’ve gone a bit beyond my scope here
(No great feat, pretty easy to do…don’t try to break it down for me, your time will be squandered)

Anyway

'Live within yer means';

Less outgo than income

Drive what you can afford

Live where you can afford

I'm not trying to be nebulous
I know the range varies, but its basic math for me

I could buy a new pickup, cash.
I choose to drive a ’93 GMC and keep the $20-$30K…or whatever new pickups cost
My Jimmy quits on me, or main bearings go, I’ll get another $2500 truck

As far as investments, I don’t play the market….too ignorant…too gullible
I just bumble along, putting meager money away

I chose a financially feasible health insurance plan for me, just to cover large horrible things
Dr visits still get nicely discounted by Medicare

I dunno, man, I’m not fat, but rich in the dumb and happy depts

forgive me
 
people get in to trouble because they live below what they think they can support ( their means as it is called ) , but , and a big BUT . if that budget is made up of all needs and few wants there can be no where to cut back from when means changes as it does all the time for most of us .

unless you have a pension in retirement we are all subject to the markets ,rates and inflation for our income . then we have our health issues that develop , divorce issues , helping family members , etc . so means ends up being variable .

so it really becomes the balance between the discretionary and non discretionary spending that lets us adapt as means changes .
 
Gary O' said:
math-

I’ve appreciated your views on finances in past posts

However, you’ve gone a bit beyond my scope here
(No great feat, pretty easy to do…don’t try to break it down for me, your time will be squandered)

Anyway

'Live within yer means';

Less outgo than income

Drive what you can afford

Live where you can afford

I'm not trying to be nebulous
I know the range varies, but its basic math for me

I could buy a new pickup, cash.
I choose to drive a ’93 GMC and keep the $20-$30K…or whatever new pickups cost
My Jimmy quits on me, or main bearings go, I’ll get another $2500 truck

As far as investments, I don’t play the market….too ignorant…too gullible
I just bumble along, putting meager money away

I chose a financially feasible health insurance plan for me, just to cover large horrible things
Dr visits still get nicely discounted by Medicare

I dunno, man, I’m not fat, but rich in the dumb and happy depts

forgive me
Click to expand...

So much of this is also true for me, Gary. I'm a practical person who's good with basic math.
I've lived long enough to know that with interest 2 + 2 (will eventually) = 5.

Investments may end up 2 + 2 = 7, but just as often it happens that 2 + 2 = 3. Or worse.

I'm satisfied to stay with the 4 to 5, forecast it as 4 and draw from it as if it were 3.
 
.

I didn't have a $4000 monthly disposable income even when I was working.
Yet I was able to retire comfortably at age 55 and 11 years later, my nest egg
is still growing.

My point is... retirement income is only relative to individual lifestyle and expenses.
One size does not fit all.

.
 
Aunt Bea said:
I haven't made any additional deposits into my retirement accounts since I stopped working in 2005, the balances continue to grow over time because I live below my means.

I have made other taxable investments/deposits since I retired, once a saver always a saver.
Click to expand...


Bravo! Great job!

I do the same thing.

Big spenders aren't able to comprehend that we are doing what comes natural for us...
this is our normal and preferred lifestyle.
 
Gary O' said:
math-

I’ve appreciated your views on finances in past posts

However, you’ve gone a bit beyond my scope here
(No great feat, pretty easy to do…don’t try to break it down for me, your time will be squandered)

Anyway

'Live within yer means';

Less outgo than income

Drive what you can afford

Live where you can afford

I'm not trying to be nebulous
I know the range varies, but its basic math for me

I could buy a new pickup, cash.
I choose to drive a ’93 GMC and keep the $20-$30K…or whatever new pickups cost
My Jimmy quits on me, or main bearings go, I’ll get another $2500 truck

As far as investments, I don’t play the market….too ignorant…too gullible
I just bumble along, putting meager money away

I chose a financially feasible health insurance plan for me, just to cover large horrible things
Dr visits still get nicely discounted by Medicare

I dunno, man, I’m not fat, but rich in the dumb and happy depts

forgive me
Click to expand...

I agree, Gary.
 
mathjak107 said:
Once of course you identify what your means is at any given moment of course .

the problem really is there is very little out there about how to spend . we have all sorts of investing information , rules for retirement draws , etc but very little on how to spend .

how much should be ear marked for the short term ? how much should be discretionary vs non discretionary , how much should a car budget be ? , a housing budget ? etc ec . all you ever see is live below your means , whatever that is supposed to mean .

fidelity has started to work in that direction and for a non retiree came up with about a 30% discretionary spending formula . DO YOU SEE HOW THAT BELOW IS VERY DIFFERENT THAN JUST SAYING LIVE BELOW YOUR MEANS WHICH IS NOT A PLAN AT ALL . there is nothing actually actionable in those words

i-5ZnDf42-S.png
Click to expand...

Mathjak....If you can afford to squander money on $500 dinners and brag about living on 6 figures, I say...how nice for you but what I don't like is the way you dish out this "advice" to us peons. You boast about what you have and look down your nose at us "average" retirees and scold us because we didn't do enough over the years to have the means to live like you do. You have NO clue what it's like to live "average". Personally, I wouldn't live where you live if they gave me the place. Been there years ago and thought then that it was a dirty, disgusting place. Quit preaching and showing graphs because no one cares.
 
Gary O' said:
Seems a no brainer Live within yer means
Click to expand...

Your a man after my own heart Gary O'!

Guess if I never found my wilderness home I would need a lot more $ to retire on, but God had other plans and led me to my Northern Alaska cabin where after 14 years in the woods I found one does not need a lot to keep one happy. I actually find it quite amusing when I do turn on my local TV and watch some of the commercials which make you feel bad if you do not have the latest of whatever they are selling.

rafting.jpg

...and God willing I will return next spring
to drift down these waters
and live out whatever time he has given me.
​
 
We live on a little over $4500/mo. We don't have a lot of expenses except for a house payment and a car payment, which will be paid off soon. No more new cars for us in the future! We've traveled as much as we wanted from 2001-2012 and don't care to wander too far from home these days. I have a hobby (I make quilts for charity) and hubby is a trapshooter and goes to one big shoot each year. We don't have any grandkids so no added expenses there. We are able to put at least half of our monthly "allowance" away in an account that earns 2% interest. We have a cashback CC we use for everything (except house and car payments) and we get a few hundred back every year. We are healthy and don't have any medical bills. We don't need much from the grocery store any more and we don't need clothes for work. We live in AZ so our wardrobe is limited to shorts and jeans.

I guess my point is...if you have $4000/mo., don't spend $4000/mo......and you shouldn't have to if your house is paid for. I think it depends on where you live what the COL will be and what you want to do. If travel is on the agenda, it will cost you. You'll have to budget more.

I'm a firm believer in living below your means. You never know what life will throw at you. Prepare for the unexpected. Have a cushion stashed away just in case.
 
.

mathjak107's talent is how to invest to get an income to live like a king.

But being a king [or a queen as the case might be] was never my style or my desire.

Besides, kings worry about revolutions that affect the source of their incomes.

Like Pete, I'm the kind who prefers to live free and independently in a cozy little cottage as far away from royalty as possible.
 
Colleen said:
We live on a little over $4500/mo. We don't have a lot of expenses except for a house payment and a car payment, which will be paid off soon. No more new cars for us in the future! We've traveled as much as we wanted from 2001-2012 and don't care to wander too far from home these days. I have a hobby (I make quilts for charity) and hubby is a trapshooter and goes to one big shoot each year. We don't have any grandkids so no added expenses there. We are able to put at least half of our monthly "allowance" away in an account that earns 2% interest. We have a cashback CC we use for everything (except house and car payments) and we get a few hundred back every year. We are healthy and don't have any medical bills. We don't need much from the grocery store any more and we don't need clothes for work. We live in AZ so our wardrobe is limited to shorts and jeans.

I guess my point is...if you have $4000/mo., don't spend $4000/mo......and you shouldn't have to if your house is paid for. I think it depends on where you live what the COL will be and what you want to do. If travel is on the agenda, it will cost you. You'll have to budget more.

I'm a firm believer in living below your means. You never know what life will throw at you. Prepare for the unexpected. Have a cushion stashed away just in case.
Click to expand...


You are blessed :)

I will buy a reasonably priced, dependable new car... then drive it for over a decade.
My Honda Civic is going on 15 years old and I love it. I hope it lasts forever. But I do
expect to have to replace it eventually with another new Honda Civic that should last
me the rest of my life.

Btw... CD interest rates are going up. First Guaranty Bank [based in Louisiana, with
branches in Texas] has a 5 year CD at 3.50%.
 


Back
Top