Monthly Budget?

[LivingAlmostLarge]

I was just wondering do people know what they spend monthly? Trying to project future expenses.

I was calculating and we spend about $2500/month living and $2500/month mortgage (PITI+HOA). So $5k/month, up to $65k/year. But whenever people talk about retirement and expenses I picture myself not having a mortgage and needing maybe $2500-3k. But if we were still working and without a mortgage I could definitely find more stuff to spend money on.

But that's why I struggle so much. I don't think I'll need an extra $2500/month in retirement after the mortgage is done.

How do you look at your monthly budget? And how to you calculate future expenses?

[disneysteve]

In my opinion, you need 100% of your pre retirement take home pay to maintain your retirement lifestyle. You will just have to move the money around to different categories.

This is my assumption as well. I do my planning based on 100%. Healthcare costs will rise. Entertainment costs will rise (travel, dining, theater, etc.). Hopefully we'll be able to be more generous to charities so that figure will rise. I can very easily see us sucking up the mortgage payment on other things that will come along in retirement. Heck, one nice vacation might cost a year's worth of mortgage payments.

[snafu]

With thoughtful planning I think you will spend less since the costs associated with employment will be removed like transportation, career clothes, socializing with colleagues, more expensive grooming products & services. You may opt for a condo which has potential to reduce work/upkeep, property tax, home owner insurance, heat and I presume mortgage payments. I know we drop to a lower tax rate and seniors get a difference base individual deduction. Clothes are more casual, trends are let go. Time to prepare more involved meals and possible grow vegetables which can make it more appealing to have celebratory meals at home with friends and relatives. Reduce theatre and entertainment costs with senior rates and matinees.

Seniors who live in this complex participate in cut rates for cruises. If 5 book as a group, they get one free trip which they fill and split the reduction between all. Another major group are snobirds. They rent a room in their condo to a university student Oct. - April mostly to have someone occupy the residence since they are gone October - April. There is about a 6 week overlap. The student 'rent' pays condo fee and utilities. The seniors have expenses for their RVs and food.

Our medical system is paid with tax dollars, leaving long term disability premiums which is often part of a benefit package.

I figure we will manage on 65% of an average of our last five years of work.

[Like2Plan]

I was just wondering do people know what they spend monthly? Trying to project future expenses.

I was calculating and we spend about $2500/month living and $2500/month mortgage (PITI+HOA). So $5k/month, up to $65k/year. But whenever people talk about retirement and expenses I picture myself not having a mortgage and needing maybe $2500-3k. But if we were still working and without a mortgage I could definitely find more stuff to spend money on.

But that's why I struggle so much. I don't think I'll need an extra $2500/month in retirement after the mortgage is done.

How do you look at your monthly budget? And how to you calculate future expenses?

There always seems to be something that creeps in there and takes the mortgage's place, so you have to be careful. Another thing to keep in mind is (hopefully) your mortgage payment becomes a smaller percentage of your budget as time goes on with pay raises and so on.
The biggest shock for me when preparing for retirement was how much money DH and I are spending on insurance. This includes health, life, dental, disability, homeowners, car, LTC, etc. All together we pay more for insurance than we did for our mortgage.

[LivingAlmostLarge]

Exactly what I wonder how much less we'll be spending.

[feh]

We have 3+ years of data in mint.com which shows us where our money goes. To determine what our budget will be in retirement, it just needs to be tweaked (health insurance will be the only major change for us).

We won't need anything close to 100% of our current net income; we spend less than half of it now.