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June 13, 2007 at 1:23 pm
I guess I’m a little slow, but I have just discovered your blog, and I like it. I’m going to add it to my blogroll on my site, as you’ve been a much appreciated poster there.
Thanks,
MG
June 18, 2007 at 2:36 pm
When do you plan on retiring?
How much money do you require to get there?
June 18, 2007 at 3:10 pm
I’m still in flux a little about the specifics, but its looking like I can live comfortably on $1300 / month, pre-tax. Given the recent income I’ve been making, potential expected returns and inflation I’m currently estimating that I could retire in 3 years (at a networth of around $300,000 I think). At that point my passive income (from dividends and rental properties) should grow enough each month to cover my cost-of-living, keep up with inflation, and grow my savings (as a buffer for anything unexpected in the future).
Obviously after I turn 65, there’d be a bit more cash to play with (if the old-age pension is still around at that point).
If my plans don’t work out (if I see a problem before I’m 65), I’ll go back to work and start saving again
.
June 18, 2007 at 8:10 pm
$1300/month? How is that possible?
June 18, 2007 at 9:13 pm
Well, my fixed costs are ~$700. I don’t own a car (I have a monthly subway pass and rent a car the odd time I go out of town), I don’t buy a lot of consumer crap, and I’ve recently cut my food spending drastically. $600 / month for food + entertainment + extras goes pretty far…
June 19, 2007 at 4:18 am
That should be $1300 / month POST-TAX (although, $15,600 isn’t taxed too heavily, especially if a good part of it is dividends)
June 19, 2007 at 10:39 am
What is your current savings rate?
(percentage of net income)
If you don’t mind me asking.
June 19, 2007 at 11:16 am
I definitely don’t mind you asking (I’m a pretty open guy, ESPECIALLY when I’m blogging semi-anonymously).
Right now I’m saving about 83% of my income (my networth increased on average $6,317.50 over the last two months, so that would equate to a gross of about $7,617.50). I’ll have a better estimate of my monthly net savings (and savings rate) on July 1st. I’ve been “tightening my belt” in terms of food spending, so hopefully my networth increase will be higher then $6,317.50 for June).
All this is pre-tax. I’m not 100% sure if I’ve got a handle on my tax implications for this year. I’m planning to take the H&R Block course this fall, max out my RRSP, and make sure I have some cash on hand in April in case the tax bill is higher then expected.
I’ve regularly gone through periods where I intentionally don’t work, so I’m used to living pretty cheap. Right now I’m working a full time contract at a pretty decent rate, which is why I’m able to save so much.
In the past I’ve saved the money then spent it during the lean periods. I’m leaning towards trying to set-up something sustainable (get my networth and passive income up to the point where if I’m living cheap I can do so off of my interest, not just off of my savings).
How does this all compare with you guys?
June 19, 2007 at 11:39 am
I wouldn’t mind seeing your expenses. You really are living quite cheaply…hence the name I guess
Mike
June 19, 2007 at 12:02 pm
That’s what my girlfriend says too
. She’s happy you guys are all shocked at how little I’m spending (she’s probably hoping it’ll loosen up my purse strings 
).
My fixed costs are listed at http://cheapcanuck.wordpress.com/2007/05/13/a-week-in-the-life-of/ (as posted above). I’m spending about $14 / day ($420 / month) on food (groceries and eating out). The other $180 is misc. expenses (I just bought a new pair of work shoes for $40, I buy the odd book, rent a movie, etc.).
I don’t smoke, and I drink very little and very occasionally. In the past a lot of my money has gone to traveling (which the $1300 / month doesn’t include). I’m going down to NY with my girlfriend at the end of the month, so that may “blow the budget” a little.
June 19, 2007 at 12:18 pm
“Over a week, my variable spending was $396.26, which works out to a total monthly “cost of living” of about $2,348.26.”
This is more than $1300.
You lost 70lbs? Holy crap that’s pretty good.
June 19, 2007 at 12:20 pm
That is impressive. We are saving 34% of net income currently. We do have a mortgage and 2 car payments though.
June 19, 2007 at 12:25 pm
4P: That was before I cut back on my food spending (yes, it was more then $1300 before). Yeah, I’ve kept it off for quite a while too (1.5 years now).
MG: I have a mortgage (for my income property), no car payments though.
June 19, 2007 at 12:30 pm
4P: That time period was also when I bought my plane ticket to NY (which obviously gave me a higher estimate then recently without buying any plane tickets
.
The $1300 / month would be without traveling and with my new food spending plan.
June 19, 2007 at 12:36 pm
Back of the napkin – We spend about $3,500 per month.
June 19, 2007 at 12:53 pm
Hmm, so I guess you’re saving a little bit more than me per month ~$6,800. My girlfriend and I keep our finances separate so I wouldn’t really even be able to guess what our combined savings are (I’m FAR, FAR, FAR more of a saver then her though).
June 19, 2007 at 5:56 pm
Our average spending so far this year is $4750 per month.
On what, I’m really not sure.
Mike
June 23, 2007 at 12:48 pm
[...] New Week In The Life After a lively discussion broke out in my “About” section where Money Gardener and Four Pillars were shocked at how cheap Mr. Cheap really is, [...]
July 25, 2007 at 9:52 am
Hi, I came across your blog while searching for blogs that write about what also write about. I work within developing nation with an annual income of $16,120. I am impressed by your savings habit. Out of my annual income, I save an annual sum of $12,000 while using the remaining as tithes, vacations and living expenses. Do you think I’m on the right track. Currently, my net worth is $39,695. What do you think?
July 25, 2007 at 12:31 pm
Good for you January!
I’m a big believer in its not what you make, but the difference between what you make and what you spend that’s important.
August 23, 2007 at 2:48 pm
Mr.C.
Are you planning on reading Derek Foster’s new book, The Lazy Investor…it just might be right up your early retirement alley….
August 23, 2007 at 2:57 pm
MG: I’ll defintiely read it. Part of me worries that Derek’s approach is “too easy to work” (do this, then this, then this and retire as young as you want!).
On the flip side, “Stop Working” is probably what got me thinking and reading about the stock market again (before that it had always seemed like the whole point was betting on which companies would go up or down, the dividend approach to buying reliable income streams was far more attractive to me).
November 2, 2008 at 8:17 pm
[...] a lively discussion broke out in my “About” section where Money Gardener and Four Pillars were shocked at how cheap Mr. Cheap really is, [...]