What Does It Cost You To Live Comforably?

[aris]

My wife and I did the calculation to live "comfortably" - i.e. eat well (no alcohol, and we don't smoke), run two cars, pay the utilities and council tax, cable & broadband, and pay for the usual things like buying modest christmas/birthday gifts for ourselves and children.

We did not not include:

rent/mortgage/debt (we were assuming we were retired and these had been paid off)

holidays (either local or abroad)

large expenditures (no plasma tv's, new cars, childrens weddings etc..)

We roughly calculated, that we'd need 1000 pounds a month just to live the lifestyle we live now - which is by no means extravagant. We could probably lower this by moving to a smaller house, and lowering the food bill by eating cheaper food, and getting rid of the cable TV - but it would not make life pleasant.

I won't go into the details of the sums involved, but our conclusion was that we'd need that in retirement income if we were to retire TODAY. God only knows what'd we'd need in 30 years time when we will supposedly retire for real.

It certaily was a sobering excercise. What do you calculate your expenditure to be?

Edited November 11, 2005 by aris

[CrashedOutAndBurned]

I've done this many times. Averaged out, I'd say the two of us can 'live comfortably' for £450 a month between us. This includes the odd pub night, rail fares for days out, and food costs, utility bills, council tax. It also includes the averaged-out cost of the odd biggish-ticket purchase which crops up for time to time (ie. some sort of computer upgrade every two years, or musical thing). I'm sure in hard times lots of little things could still get shaved off without us living a dreadful life.

That said, we have no kids and no cars and zero transport costs to get to work.

Obviously, we try and save as much as possible and our rent, I believe, is extortionate for a tiny home in a rougher street.

The only thing that spoils our life is that we live very humbly but still have two graduate-level, workload'n' stress jobs - plus my wife works freelance in addition, as do I, which often soaks up what would otherwise be free time. This extra work is 10% for personal development and because we like it, and 90% to try and get a better deposit together in a lame attempt to 'shadow' the housing market.

Ultimately with our frugal, humble, low-budget tastes I would prefer to be much less wage-dependent.

[aris]

Yes, without kids and cars, and with a smaller house (less council tax), I suspect we'd be in the 500-600 range.

What worries me is that with the price of utilities and council tax going up so much, any retirement income I have won't be enough to live on - even if the mortgage is paid.

As someone has said in another thread - the council tax is a second mortgage! Perhaps i'll have to retire to some place like Spain.

[AnotherSTR]

It certaily was a sobering excercise. What do you calculate your expenditure to be?

Two children, two cars (one 10 yrs old), two jobs (nursery and childminder) and including only non-discretionary spending and the total unfortunately comes to £2500. We could probably shave another 10% by changing to the lowest cost utlities, etc, but then it would be difficult to get much lower.

[aris]

Two children, two cars (one 10 yrs old), two jobs (nursery and childminder) and including only non-discretionary spending and the total unfortunately comes to £2500. We could probably shave another 10% by changing to the lowest cost utlities, etc, but then it would be difficult to get much lower.

Does that include mortgage/rent? If so, what is it without?

[AnotherSTR]

Does that include mortgage/rent? If so, what is it without?

No, it excludes rent.

[Nomadd]

It certaily was a sobering excercise. What do you calculate your expenditure to be?

Including rent, 2 x motorcycle insurance, 1 x car insurance, council tax, and all other bills, I'd say about £1500 / month. Even if I retired, I doubt I'd be able to reduce this by much - maybe £100 / month.

Sure, if you took rent/mortgage out, I guess you could live OK on £1000 / month, but I doubt you could live on much less than that - and people who claim they could have rarely done the math fully.

So, that's 12,000 / year, post tax. That's 5% of ~£250k. Just goes to show you why you need an annuity pile of at least £700k to retire on, which I believe is the figure most financial advisors would quote. And that's for someone at retirement age, so try doubling that figure if you wanted to retire at 50-55. Most people in this country just have no idea how much retirement actually costs, and how hard you have to save up - and for how long - in order to achieve it.

To much house price specualation and too little hard reality in this country. Still, time will catch these fools out.

Nomadd

[aris]

No, it excludes rent.

That's incredible. What is your biggest outgoing if it is not rent/mortgage?

Including rent, 2 x motorcycle insurance, 1 x car insurance, council tax, and all other bills, I'd say about £1500 / month. Even if I retired, I doubt I'd be able to reduce this by much - maybe £100 / month.

Sure, if you took rent/mortgage out, I guess you could live OK on £1000 / month, but I doubt you could live on much less than that - and people who claim they could have rarely done the math fully.

So, that's 12,000 / year, post tax. That's 5% of ~£250k. Just goes to show you why you need an annuity pile of at least £700k to retire on, which I believe is the figure most financial advisors would quote. And that's for someone at retirement age, so try doubling that figure if you wanted to retire at 50-55. Most people in this country just have no idea how much retirement actually costs, and how hard you have to save up - and for how long - in order to achieve it.

To much house price specualation and too little hard reality in this country. Still, time will catch these fools out.

Nomadd

I think people do realise, which is why everyone has given up on pensions, and gone for BTL. Think about it - you could buy 2 or 3 homes for the £700k you mention above, and would get a nice income from it - and something to show for it when you die.

This country desperatley needs pension reform - the Australians have done it, why can't we?

[Lou G]

We spend around £1200 a month on basic outgoings, food, petrol, commuting, etc and another £1k on rent.

Its a case now where the male and female need to work just to pay the bills!!!

[erranta]

I've done this many times. Averaged out, I'd say the two of us can 'live comfortably' for £450 a month between us. This includes the odd pub night, rail fares for days out, and food costs, utility bills, council tax. It also includes the averaged-out cost of the odd biggish-ticket purchase which crops up for time to time (ie. some sort of computer upgrade every two years, or musical thing). I'm sure in hard times lots of little things could still get shaved off without us living a dreadful life.

That said, we have no kids and no cars and zero transport costs to get to work.

Obviously, we try and save as much as possible and our rent, I believe, is extortionate for a tiny home in a rougher street.

The only thing that spoils our life is that we live very humbly but still have two graduate-level, workload'n' stress jobs - plus my wife works freelance in addition, as do I, which often soaks up what would otherwise be free time. This extra work is 10% for personal development and because we like it, and 90% to try and get a better deposit together in a lame attempt to 'shadow' the housing market.

Ultimately with our frugal, humble, low-budget tastes I would prefer to be much less wage-dependent.

From a recent program on a tribe in Papua New Guinea:

Spend 1-2hrs a day "hunting to feed the family".

The rest of the time is spent 'smoking', meditating (about the meaning of life), chatting and drinking parties with their mates.

To relieve the built up testosterone, every few months or so tribal chavs go and beat the hell out of a neihbouring tribes chavs.

What a life!

[AnotherSTR]

That's incredible.

Not really, see attached

Budget.pdf

Budget.pdf

[OnlyMe]

I think most people woefully underestimate living expenses and even when they sit down and try and work out the figures a lot of their actually day to day costs get left out, some of which it is possible to cut back on, some not.

I tried some analysis of the DWD board SOA's and extracted the following sample costs, run down the list and tick off the ones that apply to yourselves and see how the figures compare:

Rent £553.00

Mortgage £427.33

Mortgage/Rent £638.72

Mortgage Endowment £91.35

Maintenance £50.00

Council Tax £92.96

Electricity £28.24

Gas £29.53

Gas Service Cont £18.00

Water Rates £24.79

TV Licence £10.92

Sky/Tivo £37.05

Internet £18.43

Appliace Rentals £10.90

Gen Insurance £23.50

House Insurance £25.23

Contents Insurance £24.09

Life Assurance £40.45

Health Insurance £77.75

Pet Insurance £11.48

Vets £69.60

Personal Care £12.00

Pension £72.50

Telephone £34.13

Mobile £36.71

Food £259.89

Dining Out / Takeaways £30.00

Mags and News £16.00

Music £5.00

Entertainment £19.00

Dinner Money £97.50

Pocket Money £45.00

Childcare £66.00

Dentist £11.69

Medical Prescriptions £17.09

Parking £7.20

Clothes £38.33

Laundry £20.00

Hair £32.00

Other Travel £71.12

Cars ?????? Depreciation / Purchae /Lease ?????

Car Tax £16.98

Car Insurance £45.21

Car Maintenance £78.50

Petrol / Diesel £106.61

Car Breakdown £10.00

Presents £42.38

General Repairs £50.00

Income Protection £25.91

Professional Subs £15.16

Charity £12.00

AA/RAC £7.00

PEP ISA £27.92

Entertainment £20.00

Clubs £38.50

[ThePiltdownMan]

I am amazed at how many people force themselves to stay on this pointless treadmill.

They spend so much of their income on motoring and childcare.

I spoke to a woman at work. After the expenses of travelling to work and childcare she can contribute £100 to the household. What's the point of that?

Then after these deductions they have to spend a fortune on holidays, satellite TV etc just to stay sane.

[aris]

I am amazed at how many people force themselves to stay on this pointless treadmill.

They spend so much of their income on motoring and childcare.

I spoke to a woman at work. After the expenses of travelling to work and childcare she can contribute £100 to the household. What's the point of that?

Then after these deductions they have to spend a fortune on holidays, satellite TV etc just to stay sane.

Well, childcare is a mind-numbingly boring task. Sure, it is different if it is your own kids, but some people are just not up to it. Taking a break from work also doesn't help with future career prospects (assuming you have a "career" and not just a "job").

Saying that, if she is up to it, she could child-mind her kids and somebody elses and contribute more than 100 quid to the household.

I agree abotu the treadmill - it seems like we're just living to work. Granted, this is probably what is keeping the UK economy going (legalised slavery?), but sometimes I just feel like going to some dopey country like Spain or Greece where the cost of living is much lower, and less stressed.

[CrashBear]

I am amazed at how many people force themselves to stay on this pointless treadmill.

They spend so much of their income on motoring and childcare.

I spoke to a woman at work. After the expenses of travelling to work and childcare she can contribute £100 to the household. What's the point of that?

Then after these deductions they have to spend a fortune on holidays, satellite TV etc just to stay sane.

I've decided to get off the treadmill and to go round the world for a year or two.

The way I see it its the perfect time, no mortgage, no kids,a reseaonable deposit already saved, and hopefully a correction will be underway by the time I get back home.

Whilst saving up some cash for this epic trip I've been amazed how many expensives where going out of my account monthly. They might not have been massive amounts of money but added together they built up.

For example:

Gym Pass - £40

Contact Lenses - £22

Mobile Phone - £35

Mobile Phone Insurance - £8

Car Insurance - £80

Car Payments -£200

Rent - £300

Bills - £40

Since saving around 600 quid a month for my trip I've cut down alot of my outgoings so it now looks like this:

Rent - £300

Bills - £40

Mobile Phone (This ones going when my contract expires in Dec) - £35

I've been living on around 300-350 per month for food, transport and fun etc

By doing this it has kind of opened my eyes to the waste I did have going out. I would have thought alot of other people with their flash new cars most be paying alot out each month.

I had been asked by many people, "why don't you get a loan?" for my trip, why would I want a loan when I can save enough money myself?

I've had enough of working and being stuck in the cycle of paying out money for various things that I don't really need.

Obviously on this forum most people are pretty savvy so I would have thought most people's finances will be in a pretty good state, but the state of the average joes bank balance would be interesting.

[Quokka]

Mobile Phone Insurance - £8

you definitely need a break

seriously - take the trip now, wish I'd done it.

[OnlyMe]

Mobile Phone Insurance - £8

Ditched my contract earlier this year and use the landline - 2p connection no call costs most of the time.

Upgraded the phone - 2002 model, £500 new, £35 from Ebay (boxed, new) full PIM on PAYG, use the PIM more than the phone - only really need it when out and about if people need to conatct me.

Got a call a couple ogf weeks ago from somebody trying to sell me phone services - "how many pounds do you spend a month on mobile calls, err one I said, didn't seem to sink in at the other end so had to repeaet it yes £1, the call didn't last much longer.

[Quokka]

£1

luxury!

[Carabansity]

I'm not worried.

I will downsize to one of the really cheap two bed flats that will be available after the market collapses

[aris]

Not really, see attached

If you make the assumption that the kids are out of the house, I suspect that would come down a bit - i.e. no childminder/nursery costs, and less on food. But as you say - it does add up.

[mhifoe]

Got a call a couple ogf weeks ago from somebody trying to sell me phone services - "how many pounds do you spend a month on mobile calls, err one I said, didn't seem to sink in at the other end so had to repeaet it yes £1, the call didn't last much longer.

That sounds like my phone bill.

I wanted to avoid top-up-cards so I went to easymobile. It automatically tops your account up with 10 quid when your balance gets to £2. I've spent £10 in the last 6 months.

Well worth it if you don't use the phone a lot.

[aris]

That sounds like my phone bill.

I wanted to avoid top-up-cards so I went to easymobile. It automatically tops your account up with 10 quid when your balance gets to £2. I've spent £10 in the last 6 months.

Well worth it if you don't use the phone a lot.

I have an old Vodaphone PAYG - wife is on Virgin. I put 20 quid credit on my voda just over 2 years ago... i'm still using it ;-)

[gone west]

As I suspected food and fuel (and council tax) are the biggest expenses. Funny that they are the things kept out of inflation calculations.

Wife, three kids live very well on £2500/month. That includes 2 or 3 holidays abroad a year. Although we don't live in the UK, so maybe that explains it. Wife and I alone could live as well on half or less.

[bottletop]

mrs bottletop and I put £350 each in a joint account per month and that covers all our bills/mortgage/food. Occasionally we have to put in an extra £50 each to cover TV licence and non-DD bills

We both spend 300 per month on "incidentals", leaving around £750 each savings.

Both of us earn around 22k, so we live well below our means....spending around 50% of our earnings I guess.

[aris]

mrs bottletop and I put £350 each in a joint account per month and that covers all our bills/mortgage/food. Occasionally we have to put in an extra £50 each to cover TV licence and non-DD bills

We both spend 300 per month on "incidentals", leaving around £750 each savings.

Both of us earn around 22k, so we live well below our means....spending around 50% of our earnings I guess.

750 pounds a month to cover a mortgage and all living expenses is amazing - i'd struggle to do that without a mortgage/rent. Where do you live exactly? I presume no the South East! :-)