Retirement on $30,000-more or less!

 I apologize twice over, folks, this was up once, and fell into the great abyss it seems. Also, I have been remiss in posting and commenting on your comments. I had to go back to moderation, and a shoulder injury (another post entirely, coming soon) is holding me back!

Also, while I'll dedicate one of my next posts to this, the new bankrate summary shows Colorado among the five top best places to retire, and Florida in the bottom at 39th, and California at 28th.  More in a day or so.

Yesterday evening, I went to the Colorado Symphony.  I enjoyed a violin concerto and an hour and a half of Mahler (yes, I actually do like Mahler).  Our seats were in the first orchestra.  After the symphony it was breakfast at a local Perkins where I allowed myself the country gravy, sausage, eggs and biscuits.  Today was a relaxing day at church, enjoying basketball finals and sitting on the patio.  Since one member of this household is working on the weekends, I am in the middle of a large project and the college student has term papers and exams due this week, we are cheating and having frozen lasagna and garlic bread and sides.  

The previous few nights we have grilled beef skewers, beer brats, and pork chops along with homemade salads, breads and desserts. During the week, I made a quilt.  I enjoyed my knitting group and happy hour on Wednesday, my book group, my craft group and my other daily routines. I went to see the movie the Winter Soldier. I worked on the patio. 

In terms of future plans, I also planned for my one week vacation in Santa Fe in August-where we have rented a huge house with soaker tub, hot tub, private drive way and the works.  I scheduled a road trip to Texas via old route 66, with economy sleeping plans.  I'm working on my mid fall trip by train to San Francisco where I'll stay in a youth hostel.  I'm planning for an art class, and trying to decide if I should take a class in the summer or leave it free for as many day trips as possible.  Today I'm sitting down with a list of festivals and craft fairs in Colorado and the surrounding areas and trying to decide if a beer or wine tour is in order locally. And our local community theater has an upcoming performance of The Music Man!

This is what life is like on $30,000 a year-for me.  It has been a year since I moved from what was in theory a low cost of living area to one with a higher cost of living area.  While my primary reason was a different environment and to be near family, my goal was also a financial overhaul.  After I made that decision, I did receive comments from folks who had left Denver and gone to Seattle because they felt it was too expensive.  When I wrote an article earlier about moving from a lower cost to a higher cost area, one reader suggested that I didn't know what I was doing in moving from Texas to Colorado to save money, and that once I paid the taxes and faced reality, life would not be so much fun any more.

I am here to tell you that she was wrong. Life can be lived as a single person on $30,000 a year, and I believe that most couples could do the same.While the specific numbers are worth sharing, it is worth talking about how I live specifically in terms of choices (and also about the more or less, mentioned above). Before I share general budget numbers (at the bottom), a bit about what it is like living on that monthly income!

Admittedly I have some situations that are unique to me, and that not every retiree may be able to duplicate.  For example, I live in 1300 square feet on the first floor of a house with a yard, for which I pay $700 and $200 more or less in utility costs (I keep my house at 73 in winter and rarely use AC even at 90 degrees).  Others may not replicate this area so easily, however many folks have options. Some retirees have homes paid off, some are close to that. Some live in lower cost of living areas.  There are many choices to be made.  

This makes my monthly basic living costs right around $900 monthly. (without my cell phone).  I rent this home, althoug purchasing of this house was a joint family venture, which means my roommate and I share the cost of the housing cost (which does include taxes and fees rolled in, for those who are wondering).  The investor (my brother) purchased the home as in investment and we live in and occasionally improve the hse.  While my housing situation is unique, I was willing to live in a one bedroom with den condo for $1000 and lesser utilities-in fact it was my original plan.

The other place that I may have it easier than some retirees (especially early retirees) is in the health insurance area.  My health insurance is not in this budget because it goes out of my pension before I see it and is not included in that monthly amount.. For those who wonder, I pay about $225 monthly for "family" insurance.  Next year when my son turns 26, my fee will be closer to $150.  More importantly though, I have "good" insurance through the feds. My co pays are generally no more than $20.00 in network office visits. However, as some may remember last year, my ten percent of a three day hospital stay was $1800. Since I am not of medicare age yet, I realize that I am blessed not to have had to drop onto the COBRA wagon or face other issues. 

 I have a rewarding and busy at home retirement much of the year,.  That retirement lifestyle is broken up to three our four vacations a year, usually road or train travel.  I choose to remain in the US and on road mainly for non budgetary reasons  That said, I hope to travel to my second home of Germany in the next two years, as well as take a trip to Grand Cayman.  As my travel plans above show, I intersperse the occasional costly travel item (a shared house in Santa Fe) with free and less expensive alternatives (a youth hostel, a best western hotel).  It goes without saying that I also research every free option wherever I go, and that I travel frugally by carrying coolers and food.

I eat well, and generally at home. I am not a great cook, but I am a great baker and most of our food is made from scratch. When I do face time issues, rather than eating out we take advantage of simple foods or use the grocery deli counter (as for the beef skewers above).  I discussed in another blog post how I feed two adults and a six foot six college student with a hollow leg on less than $250 a month except for weekend dinners. I eat out generally no more than once a month, at upscale non chain restaurants, using a Groupon when available. We have a local restaurant that flies in flue crab once a month in the summer, so I know where I will be spending my evening out in June.

I use mainly free and "community events" for regular entertainment. I have a community theater where one watches for free for volunteering.  I regularly go to free concerts at my church, and take advantage of summer music opportunities  There are local small town symphonies, free art gallery days, Friday night art walks and the like, that keep me more than entertained for free or very little.  A few times a year I go to a "real" theater, concert or event.  I'm considering an annual membership to the Denver Art Museum or Botanical Gardens.  Both are good IF I use them at least four times a year and bring a friend. I'm on the fence right now. As always I look for deals, freebies and last minute open seat offers.

 When it comes to sitting in a movie theater or going to a special event, I make sure it is something I will love, I check discount coupons, and I appreciate it for what it is.  For example, when it comes to sitting in a movie theater,  I do so only for those movies that I feel NEED to be seen in a real theater (some do), usually on discount weekdays.  Gotta love that retirement freedom.

My day to day hobbies and interests are generally free or almost free (although some of them do have some expensive material requirements). I have a knitting group that meets in a local independent bookstore.  The local newcomers club (which is really just a social club-some members have been here for years), have a crafting group, a book group, a movie group and multiple card groups, and a golfing group. I get my primary enjoyment from interacting with others with similar interests, reading, doing hobbies, enjoying my home and my patio. I am a material hoarder, which means that although I could buy fabric or yarn or paint or jewelry findings or wood pieces tomorrow, I could make five projects of professional quality out of what I have on hand. I used to have an entirely separate "fabric" budget.

My "entertaining" generally consists of group and rotating dinner events where the host(ess) provides the main dish and appetizer and the guests provide everything else. When we have folks over for dinner for a Christmas party, I generally work with the rule of one (one spectacular decoration, one to die for dish) and work everything around that, or do themed parties like Christmas cookie swaps that cut down on effort and cost.

My "beauty and health" routine is very simple. Again, this is more because of my lifestyle choice than a financial issue. I belong to the local recreation center where I walk in the water-and cannot wait until I am old enough to take Silver Sneakers classes! I buy a very few good quality skin care products twice a year when they are on sale and use them as needed.  I wear little makeup (mainly because my skin is so dry I moisturize it multiple times a day (and yes, I am using the riches products available).  Every year I ask for my same favorite perfumes for Christmas or Mother's day, and every day I get them.  So far.  I keep my hair very short and silver.  I'm in the water sometimes twice a day, I work with paints and chemicals and sharp objects. I'm also lazy and I wear big jewelry.

When it comes to clothing expenses I wear mainly casual, classic pieces.  The best way I can describe it to my women readers is imagine if you walked into Steinmart today and saw the casual black yoga pants and the long white skirts and the bright colored tops and tunics. this is what I wear year around, simply moving to sweater tunics. Put simply, I do the casual flowing thing, not the jeans and tailored thing.  That is what I do.  This takes me most places, from knitting class to church, depending on how I accessories. I only buy clothing when I need it AND when I love it AND when I know it will go with everything else. I rule out no store as a clothing resource.  I buy expensive, comfortable shoes from Clark's Bostonian, generally buying two pair per year, always on sale and usually at the same time (when they have a buy one, get one half price or better sale).  I still have a pair of walking shoes I purchased from Clark's the first year I came back from Germany (2008).

Finally, I am sure that some of the reason I am successfully living on my income is that in general, I have the personality type that would prefer to create a solution rather than pay for one, when possible.  This does not mean that all my solutions are pretty, or that I never resort to buying something.  It just means that by nature, for me, that is generally a last resort.  I was blessed to have had a patient husband and equally patient children who were not afraid to say "Oh, No!!", or Oh, Yes," in these situations.  

Hand in hand with the above are two other personal traits.  The first is the fact that I am willing to wait.  While there are things I want now, there is nothing I need now. I am willing to wait for the right solution at the right price, as well as willing to look for that solution in non-traditional places including used sources. The second trait is that I am willing to consider all sources all the time-I'm talking primarily in terms of shopping here, but the same applies I suppose to anything else. I don't necessarily consider the Littleton Symphony inferior to the Colorado Symphony.  I don't assume that I will like Nordstrom's clothing better than Kohl's clothing better than my local consignment store.  Certainly there are some exceptions. I only buy Clark's shoes (after much trial and error). But over all, I think my open mind in this area has gotten me more for my money than almost anything else.

Finally as a quick aside, I am the queen of discounts and freebies. I do allow part of every day (generally one half an hour ) to read the freebie emails in my inbox and grab links to any deal that I might consider using

Now, before we get to the specific number portion of this missive, I do need to address the more or less.  Before you say "I knew it", or "Now, we come to the real truth", hear me out.  Recently, I willingly took on a car payment. In order to have that car payment for as short a time as possible, that car payment is large ($500).  I have shared on this blog in the recent past my "web research gig" and how interesting that is. So, for the moment I am paying for that payment from a different source.  Were that source not available, I would refinance to the smallest amount and adjust the savings, travel and sinking fund categories appropriately. earning by choice is covering that amount, that is not included in my budget numbers. in fact, for a few hours or less a day (as the mood strikes me), I am learning more than that.  That said, my general budget is only based on what I regularly earn through unearned sources.

So, when we come to the nitty gritty of life on between  $2600 a month, this is what you get.  Remember that I am not a budget person, and use broad categories for budgeting, although I do track every thing by small individual categories.

House payment with taxes rolled in      $700
Electric/Gas (1/2)                                     100
Water                                                         20
Cable                                                        100
Trash/Recycling                                          25
Total: 945

Cell Phone (includes son's portion )         100
Groceries and Dog food                            300
Gas                                                             50
Car Insurance                                             80
Monthly Haircut                                         25
Rec Center                                                  25
Church and Charity                                     40
Total:  620


Sinking fund                                            550               
Travel Fund                                              550
                            
Total:  1050

Because do not live off a 401K or investments, I base my budget on my unearned income. I use broad categories, and one sinking fund for unexpected and variable expenses.

My sinking fund includes emergencies/savings as well as the money for monthly variables .............clothing ($600 annually), House stuff such as pillows, gardening supplies ($1000), medical copays ($2000), car maintenance, and non travel entertainment $(400).  This fund was only emptied for relocation to date. 

So there you have it.  What do you feel I have left out?  Do you think I'm unrealistic?  What do you think of my budget categories. Do you approve?  

Feel free to share-I'd love to hear your thoughts and I promise I can take it!