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Measuring Expenditure in Retirement

Including Financial Independence and Retiring Early (FIRE)
pds2008
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Measuring Expenditure in Retirement

#250689

Postby pds2008 » September 10th, 2019, 10:50 am

I have been looking at my regular expenditure now that I have retired and compared it to my original expectations when planning my income in retirement. I retired in 2018 aged 54 and am now entering my second year without working. I am posting this because some of the facts about my current expenditure surprised me and there will be a few people looking at their post retirement expectations in terms of income. Maybe they will find it useful.

A few relevant facts; when I retired I also moved from a city (Edinburgh) to a more rural location. I am single and I have removed expenditure relating to holidays as my holiday habits have changed. I have compared the spend over a three month period (June-Aug) in 2017 and 2019 and used some broad categories:

Overall Expenditure – down 28%
Cash – down 54% - when working I used cash for taxis, lunches, drinks after work and newspapers. It should not have been surprising how much this adds up but it was hundreds of pounds per month
Clothing – down 67% - I was never a clothes horse but taking work out of the equation allows me to be my normal scruffy self 24/7
Direct Debits – no change
Food & Drink – down 29%. Much more of a planned shopping routine – not popping in for rubbish on the way home from work, including regular bottles of wine.
Transport – down 54%. I have not run a car for 10 years now although I do miss it more now I am out of the city – may be a future purchase and cost item. Less train travel within UK now I have moved closer to family.
House & Garden – up 8%. Having moved to a new house last year there are a few purchases for the home
Miscellaneous – down 3%. Mostly daft Amazon purchases, occasional non-food shopping – books, Boots purchases, etc.

The important thing for me is that all this has occurred without any conscious saving. I could easily reduce my income requirements by another 20% by cutting some monthly direct debits, budgeting more on food and drink, watching cash spend, and so on. That would represent almost a 50% reduction in spend. Further more I have not “slowed down” in retirement; I volunteer two days per week, and enjoy the free benefits of the country with walks and bike rides.
I hope people find this useful – apologies if some believe it belongs on another board

tjh290633
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Re: Measuring Expenditure in Retirement

#250812

Postby tjh290633 » September 10th, 2019, 6:21 pm

My experience was that expenditure reduced because I had no mortgage any longer, car mileage fell a lot and I made a profit on my company car. Eating out became more frequent, my wife commenting that she married me for better or for worse, but not for lunches. No more pension contributions or NICs, of course. No more need for suits, I have one kept for my eventual demise. Otherwise I go for separates and the casual look.

After 5 years, the combined total of pensions and investment income was more than my retiring salary. After 21 years it is more than double that figure.

It's nice to have a decent holiday or a family celebration from time to time. Also the ability to build a pot for each grandchild is nice. Hopefully it will see them through university, get them on the property ladder, or buy their first car.

TJH

SalvorHardin
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Re: Measuring Expenditure in Retirement

#250829

Postby SalvorHardin » September 10th, 2019, 7:22 pm

It costs quite a bit to be in work. Not just the commute; it's things like clothes and time pressure (because of work) means that you are less selective in how you spend your money.

It's tempting to buy lunchtime sandwiches and coffee from Pret a Manger, rather than something at home. If you're working full-time you are more likely to shop at just the one supermarket, which is not going to be the cheapest for everything that you want, but whey you retire you've got the time to visit other supermarkets. As pds2008 pointed out it's very easy engage in impulse buying on the way home to and from work (I spent something £15 per week on books and magazines solely to read on the train when I commuted to London in 1999-2002).

Rural living helps a lot, as pds2008 has discovered. There are simply fewer things to spend your money on out here in the sticks (of course in retirement it's very tempting to buy a lot online - I've had deliveries from Amazon Prime every day for the past two weeks).

Even going to the cinema can be cheaper in retirement, because you can avoid the more expensive evenings and go in the cheap afternoons. It's surprising how much this adds up; until I was banned from my local cinema I reckon that I saved £8 per month just by going in the afternoon rather than in the evening.

Lootman
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Re: Measuring Expenditure in Retirement

#250830

Postby Lootman » September 10th, 2019, 7:31 pm

SalvorHardin wrote:until I was banned from my local cinema I reckon that I saved £8 per month just by going in the afternoon rather than in the evening.

OK, you cant just let that go. How on earth do you get banned from a cinema?

I've been banned from pubs, clubs and even a restaurant. But a cinema?

I rarely go to the cinema any more. Home theatre plus streaming does it for us. Wine fridge in the AV room and off to the races.

ReformedCharacter
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Re: Measuring Expenditure in Retirement

#250834

Postby ReformedCharacter » September 10th, 2019, 8:06 pm

Lootman wrote:
I've been banned from pubs, clubs and even a restaurant...


That's quite impressive ;)

RC

SalvorHardin
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Re: Measuring Expenditure in Retirement

#250841

Postby SalvorHardin » September 10th, 2019, 8:17 pm

Lootman wrote:
SalvorHardin wrote:until I was banned from my local cinema I reckon that I saved £8 per month just by going in the afternoon rather than in the evening.

OK, you cant just let that go. How on earth do you get banned from a cinema?

I've been banned from pubs, clubs and even a restaurant. But a cinema?

I rarely go to the cinema any more. Home theatre plus streaming does it for us. Wine fridge in the AV room and off to the races.

It was over my motorcycle helmet. I had just bought my ticket (afternoon showing) and the usual selection of cider, hot dog, etc.

Then when checking tickets an overzealous staff member who had just been on a health and safety course decided that I was a safety risk because someone might trip over my helmet.

I pointed out that the cinema was probably going to be no more than 5% full, so they'd have to be the unluckiest / clumsiest person in Somerset to trip over my helmet when it was on the seat beside me. Also that if I was a risk then what about the woman who had just gone in with two big bags?

And that they weren't being honest; there had been a few articles about people using helmets to hide cameras. Told him that staff were a much bigger piracy risk than punters.

Health & Safety man threw a major wobbly, called the manager who decided I was a serious troublemaker because I rode a motorcycle. Told me to leave and don't ever come back.

I now have a very good home cinema system!

djbenedict
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Re: Measuring Expenditure in Retirement

#250846

Postby djbenedict » September 10th, 2019, 8:49 pm

SalvorHardin wrote:
Lootman wrote:
SalvorHardin wrote:until I was banned from my local cinema I reckon that I saved £8 per month just by going in the afternoon rather than in the evening.

I've been banned from pubs, clubs and even a restaurant. But a cinema?

It was over my motorcycle helmet. I had just bought my ticket (afternoon showing) and the usual selection of cider, hot dog, etc.

Then when checking tickets an overzealous staff member who had just been on a health and safety course decided that I was a safety risk because someone might trip over my helmet.

I pointed out that the cinema was probably going to be no more than 5% full, so they'd have to be the unluckiest / clumsiest person in Somerset to trip over my helmet when it was on the seat beside me. Also that if I was a risk then what about the woman who had just gone in with two big bags?

And that they weren't being honest; there had been a few articles about people using helmets to hide cameras. Told him that staff were a much bigger piracy risk than punters.

Health & Safety man threw a major wobbly, called the manager who decided I was a serious troublemaker because I rode a motorcycle. Told me to leave and don't ever come back.

I now have a very good home cinema system!


You ride to the cinema in the afternoon, drink cider (at the cinema?) and then what, ride home? To cut to the chase: what do/did you ride?

SalvorHardin
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Re: Measuring Expenditure in Retirement

#250866

Postby SalvorHardin » September 10th, 2019, 10:15 pm

djbenedict wrote:You ride to the cinema in the afternoon, drink cider (at the cinema?) and then what, ride home? To cut to the chase: what do/did you ride?

1 pint. Well within the limit. Some cinemas have been serving alcohol for a few years (Odeon even has a wine list).

Ride there. Ride home. Then walk down the pub. Sometimes the film would end early evening so I might stop off for a kebab!

At the time my bike was a forty year old BMW R75. I now have a thirty-something BMW R80RT (it's much lighter than the R75 which I'd have some difficulty handling nowadays due to the weight.

djbenedict
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Re: Measuring Expenditure in Retirement

#251612

Postby djbenedict » September 13th, 2019, 12:59 pm

SalvorHardin wrote:At the time my bike was a forty year old BMW R75. I now have a thirty-something BMW R80RT (it's much lighter than the R75 which I'd have some difficulty handling nowadays due to the weight.


Nice bikes. Quirky.


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