How much to live on

blue.peter

Langtang said:

...wading through them trying to filter the transactions into groups (food, entertainment, cars etc) is proving hefty.

Do you need that much detail? Remember, the primary objective is to know how much you spend overall.

I was able to take a bit of a shortcut when I did mine. I put pretty much all of my spending apart from the household DDs (Council Tax, utilities etc.) on my credit cards. So a simple reference to "credit cards" in my analysis covered a multitude of things - food, books, music, clothes, motor and home insurance etc. It didn't affect the total that I spent, or therefore the mount of income that I needed. It just meant that I had a less detailed breakdown of where the money went.

MovingForwards

@Langtang you're over complicating it. I have an annual budget spreadsheet, each December I work out my new year budget and fill in the spaces. Some get filled in when that is planned or money spent under the category. All I had to do was skip to a random month and remove anything I won't require when retired (apologies in advance for the formatting, always goes funny when I copy from spreadsheet into a post on my phone)


Mortgage
Mortgage O/P
Utility Bills
Council Tax

Food
Phone
Travel
Union Subs
Credit card
eBay / PayPal
Savings
S&S ISA
PBs
Pension
Miscellaneous
Hair / Eyebrows
Pocket Money
Petrol
Bank Fee 

So as you will see from 19 items, a lot will be removed when retired.


In the same spreadsheet I've all my pensions and pension savings listed:

PB

S&S

SIPP Pension

Old Pension

Old Pension

DB Pension

DB Lump Sum On another page I've got all my savings and what they're earmarked for. I also plan what I'm paying into each every month.

203846930

How many years do you think would be reasonable to go through to get a figure? is 5 years too many?

Mine was an ongoing calculation, I knew instantly the moment that I would be able to stop working, it did help that I had been using Microsoft Money for about 15 years and could see at a glance what my spending was but it was something that happened that was totally outside all of my calculations and estimates that was the clincher.

It was the descision by the Government to move the age where you could access your own private pension fund that tipped the balance in my favour.

You should know what your monthly fixed bills are such as energy costs, mortgage/rent and rates as well as an idea of your various insurance costs, the only things you need to work out is your 'daily' spend and the extras such as holiday spend.

Please don't take offence but if you can't work those numbers out quickly from your last couple of months spending then you have too much money to worry about.

mark55man

very true Duncan - we do (I do anyway) tend to overcomplicate things, but the basic spends are there in front of you.  I have been trying (for about 5 years) to simplify things - its not going well

Langtang

blue.peter said:

Langtang said:

...wading through them trying to filter the transactions into groups (food, entertainment, cars etc) is proving hefty.

Do you need that much detail? Remember, the primary objective is to know how much you spend overall.

MovingForwards said:

@Langtang you're over complicating it.

Of course, you're both absolutely right. I was trying to drill down way too far. If we spend it, it doesn't matter what we spend it on but more the fact that we spend it. I think you've probably saved me from RSI.

Langtang

duncanthedog said:

How many years do you think would be reasonable to go through to get a figure? is 5 years too many?

You should know what your monthly fixed bills are such as energy costs, mortgage/rent and rates as well as an idea of your various insurance costs, the only things you need to work out is your 'daily' spend and the extras such as holiday spend.

Please don't take offence but if you can't work those numbers out quickly from your last couple of months spending then you have too much money to worry about.

Indeed, a quick tally of fixed monthly "bills" comes out at a little over £950, but that includes car payments, pension payments, commuting fuel - all of which would probably go, or be drastically reduced.

I'm too long in the tooth, and thick skinned to be easily offended.

I fear that we do have, or will have, too much money but that is another story....

Langtang

mark55man said:

very true Duncan - we do (I do anyway) tend to overcomplicate things, but the basic spends are there in front of you.  I have been trying (for about 5 years) to simplify things - its not going well

It would seem I've been trying too hard on this, to the point of budgeting for one meal out per month and then worrying that we might have two!

Langtang

Just wondering how people pay for insurances etc when retired. It seems easier to pay for these monthly but, since this is MSE, that is obviously more expensive than paying them outright due to interest. £12.50 per month for car insurance seem a reasonable monthly outgoing, but if the premium is only £125 to pay outright....

MovingForwards

@Langtang I pay my insurances in full annually and will continue to do so when retired, it's one less bill to pay each month.

I have a savings pot and each month I put £100 in, that £1200 per year covers car and home insurance, car repair bills, MOT and tax. The figure is based on how much it cost me last year. If I don't spend all of it this year I will continue to add £100pm next year and each one after that, at some point I will replace my car with another little runabout.

blue.peter

Langtang said:

Just wondering how people pay for insurances etc when retired. It seems easier to pay for these monthly but, since this is MSE, that is obviously more expensive than paying them outright due to interest. £12.50 per month for car insurance seem a reasonable monthly outgoing, but if the premium is only £125 to pay outright....

Quite. I pay mine annually in full. I find that the amounts aren't vast - about £250 for motor insurance and £110 for home insurance in my case. Those are amounts that I can easily absorb (which isn't to say that the same is necessarily true of you). And it helps that they come six months apart, rather than both at once.

(When I lived in a flat, I had no choice but to pay the buildings insurance in one lump, because that was how the management committee billed it. Interestingly, I find that buildings and contents together for this house comes to about the same as each of the separate buildings and contents policies that I had then. In other words, I'm now paying about half as much for insurance on a three-bed semi as I paid on a one-bed flat eleven years ago.)