Rejiggering the Budget & Spending in Retirement-2018

We had our budget meeting for 2018.  That's our discussion on how much money we'd have for 2018 and where we are going to spend that money.

Just to recap, our income is derived from an annuity payment each month, and once we access it, our 401K account.  We also have additional regular savings that I've socked away since 2009 which we can access if needed(but I hope we don't need it this year).
We have a RMSA to reimburse for healthcare premiums in 2018 and I'll be starting to use our HSA account starting in 2018 for medical co-pays/payments.
So this discussion is just about how/where to spend the annuity income and how much 401K cash we need to withdraw in 2018.

First thing was to figure out how much money we spent in 2017.  This will help us figure out what we'll need to spend in 2018.  Using that as a base we can add/subtract due to changes we want to make in 2018.
After tallying it all up I found that we actually spent just shy of $60K last year.  That's a lot of money!  Some of that spending won't be happening going forward, like College Boy's tuition and living expenses at the apartment up at college.  And hopefully all the expenses associated with the Louisiana house will be going away this year too.  Other expenses we stopped paying in 2017 once Hubs retired were commuting costs, dry cleaning costs, and other costs associated with him working.  If the stars all align I believe we'll have expenses about $10K less than what we spent in 2017.

Last year we had a foot in both the regular income world and the retired income world so it was a hard year to balance spending.  This year it's Retirement 24/7 at Chez Sluggy. ;-)

Going forward our annuity comes to just over $38K per year net.  I don't know with the new tax legislation if the tax withholding will change so I'll go with what we've been getting so far.

First order of business was to figure out how much we actually "need" to withdraw from the 401K to supplement the annuity income in 2018.  We were able to hold off withdrawing from the 401K the last Quarter of 2017 but that won't cut it going forward as Hubs wants to spend more on "fun" in 2018.

* Hubs' plan going into retirement was that he wanted to withdraw $36K a year from the 401K($9K per quarter).  Even at this rate, once we stop needing to withdraw the 401K $ to live on in 7+ years, when Hubs hits full Social Security age, we'll have over 75% of what we had when he retired in that account. So it's in no danger of being depleted withdrawing at that rate.
$36K after tax withholding would be $30,600 net.
$38K+$30,600 is $68,600 net income a year.

Now I know if we take out that much Hubs will set about spending that much! lol  I really don't think, at least for now, we need to withdraw $9K every quarter to supplement the annuity and live a comfortable life.
Call me the "stick in the mud" in this relationship but starting in 2019, for the following 4 years and 3 months(4 years and 11 months for me)we are on our own with regard to healthcare insurance and who even knows what health insurance will look like/cost after 2018.  Yes we have a medical savings account but there isn't enough in there to pay for almost 5 more years on insurance premiums out of pocket.  I am staying cautious when it comes to spending money on "fun".  I pointed out to Hubs that we already spent over $8K in discretionary or fun in 2017 so we really don't need to withdraw lots more $ for that purpose.   ;-)

Withdrawing $6K a quarter gives us $20,613.24 per year after tax withholding which bumps our income up to $58,690.80 net per year.
It's about $1500 less per year than what we spent in all of 2017.  I'd like to try to keep the withdrawals to this amount per quarter, at least for now.

* Next order of business was the "Walking Around Money" or WAM.
Since retiring we've been allotting $100 each per month for each of us.
In the last 6 months I've found I can stay under $100 per month easy.  Hubs?....not so much.
He doesn't feel comfortable getting down to his last dollar.  He had a "situation" where he went out for Chinese take-out at the other place in our town because our usual place decided to close on Mondays(and it was a Monday).  This other place only takes cash or local checks, no credit cards.  We didn't think about that when he went and of course, being the end of the month, he didn't have enough cash to pay.  Ever since that incident he's been antsy about running out of cash.

Now I don't think it's "fair" that he gets more WAM than me to throw about anyway he wants and he doesn't think it's "fair" that he can't spend what he wants on what he wants.  It's the old "I work hard so I deserve it" gambit, right?

I asked him to make a list of things he might want to buy in 2018 and we can set this much aside for him to blow.  But he refuses to be pinned down or give me any inkling on what he WANTS to spend on in 2018.  This makes me nervous since I am sure between buying coffee drinks, trips to McDonald's, books at retail price, alcohol, spending money on chess(software and entering tournaments)and on his new beer brewing hobby(the equipment can be pricey!)during all this free time he now has, he could blow through his WAM plus another $10K in short order and have no clue he's blown through that much.

We came to a compromise on the WAM--we still only get $100 per month each BUT he gets an extra $50 in January ONLY.  He's going to keep that $50 as an emergency WAM back-up amount so "if" he runs out of WAM before the month is over he won't "feel" broke. lolz  I just keeping wondering how long until he spends that extra $50 and wants it replaced?...Hmmm.....

* Then it was on to the Sinking Fund to pay irregular bills out of.  Hubs didn't like the idea of pulling $650(or more if costs go up on those bills)off the top of the annuity payment each month.  I went through the IBs(irregular bills)per quarter and showed him how much we need each quarter to pay those in full. 
1st Quarter-$2558.51(Garbage, Sewage, R/E Taxes, LTC(Long Term Care Policy))
2nd Quarter-$1383.24(Car Insurance, LTC)
3rd Quarter-$3220.29(House Insurance, School Taxes, LTC)
4th Quarter-$1383.24(Car Insurance, LTC)

So I am taking the corresponding amounts in Jan., Apr., Jul. and Oct. off the top of the 401K withdrawals in each of these months to cover the IBs and putting it into a designated account out of which the IBs will be paid.
I really don't see what difference it makes if I take it out of the 401K withdrawals or $650 out of the monthly annuity payment but if doing it this way makes Hubs happy, I'm good with it.  8-)

For the 1st quarter after deducting the $ for the IBs into the Sinking Fund, we have $2,594.80 left in the 401K withdrawal to add to our income this quarter, or $86493 each month to add to the annuity income for Jan., Feb. and Mar. 
For the 2nd and 4th Quarters we'll have $3770.07 left in the 401K withdrawals to add to our income, or $1256.69 each month as the IBs aren't so much in those quarters.
For the 3rd Quarter we'll only have $1933.02 left in the 401K withdrawal to add to our income, or $644.34 each month.

So after taking the IBs dedicated amounts off the top of the 401K withdrawals here is what our net "income" will look like per month--
Jan. $4038.06
Feb. $4038.06
Mar. $4038.06
Apr. $4429.82
May $4429.82
Jun. $4429.82
Jul.  $3817.47
Aug. $3817.47
Sep. $3817.47
Oct. $4429.82
Nov. $4429.82
Dec. $4429.82
$50,145.51 Total for 2018 to pay all the variable bills per year.
(Plus $8,545.29 tucked away to pay the IBs for the year.)

So this is the financial game plan heading into 2018.

Questions?
Comments?


Sluggy

This Week on the Dining Table

The "Best Present" Edition--

Under penalty of death(by their father)my kids went on Xmas Eve(while eldest was home)and had a group portrait done to gift to me for Xmas.  I had requested this from them since the last time they did this for me was Xmas of 2012.
I had posted this photo of Facebook earlier in the month with the comment that "this was my best work". ;-)

Moving On....

Onward to the meal planning!

Here's what was planned last week--

1. Sunday--Country Fried Steak, Mashed Taters, Gravy, CA medley Veggies

2. Monday--Chinese(maybe)

3. Tuesday--FFY or Leftovers

4. Wednesday--Hot Dogs on Rolls, Beans, Potato Salad

5. Thursday--Veal Parm, Brussels Sprouts
6. Friday--Manicotti in Sauce, Salad
7. Saturday--Leftovers

And this is what actually happened--

1. Sunday--Country Fried Steak, Mashed Taters, Gravy, CA medley Veggies

2. Monday--Chinese

3. Tuesday--FFY or Leftovers

4. Wednesday--Hot Dogs on Rolls, Beans, Potato Salad

5. Thursday--Leftovers
6. Friday--Leftovers
7. Saturday--Chicken Parmesan, Brussels Sprouts

Last week saw 3 nights of home cooked dinners, 3 nights of leftovers/fend for yourself, 1 night of take-out and 0 night of Eating out.  Mostly everything happened but not when planned always.  We ate lots of leftovers so the Manicotti stayed in the freezer.

2 Trips to Weis and 1 trip to Dollar Tree was the extent of the shopping last week and the bills came to $121.56 for all.  That brought January's food spending total to $182.16.
There are 16 days left in my shopping month.  

My savings percentages last week was 54.28% and the monthly savings so far ends up at 52.59%(without Rite-Aid trips added in).

Leftovers going into this week....... rolls.  We used up everything else. 8-)))  I guess I need to do some cooking this week, huh? lolz

Here is this week's "food plan".....

1. Sunday--Turkey Breast, leftover Stuffing, Gravy, Butternut Squash, Sweet Potatoes

2. Monday--Lasagna

3. Tuesday--Turkey Casserole or Pot Pie(using leftover Sunday turkey)

4. Wednesday--Tuna Noodle Casserole

5. Thursday--Leftovers
6. Friday--Baked Ham, Rolls, Corn Casserole, Cabbage
7. Saturday--Leftovers

This week will see 5 new meals cooked, 2 nights of leftovers, 0 night of Take-out/Eat-Out.
I used up one of the THREE turkey breasts in my freezer and I'll use that ham that was free from Weis sitting in my fridge later in the week.  Next week will be using leftover ham plus eating down some other meats in the freezer(I am thinking goulash and some other beef dishes as I have quite a few packs of steak/roast/London broil).  I also want to get back to making a soup on Sunday too and making fish as we've gotten out of the habit again.

The only thing I need to buy to make these meals is cabbage.  I built the menu from what I picked up last week or had the ingredients already in the stockpile.  I don't plan to do a big shop this week but with me, you never know, do you? lolz

What is getting fixed and served at your house this week?

Was last week's plan successful, did you go off plan or did you not even plan what was going to be eaten last week?

Any great deals on food at your stores this week?


Sluggy

Sluggy's Boring Blog Box Giveaway.....January 2018

And it's time for the First Sluggy's Boring Blog Box Giveaway for 2018.
January is turning out to be a big old ball of frozen for most of the country so let's thaw out a bit and have a giveaway.  This box includes some toiletries as well as the always popular-chocolate!
Come on and enter.
Somebody has to win and it might just be YOU!

Here is what you can win if your entry is picked.

1 x Eucerin lotion(sample size)
1 x Advil Junior(chewable for kids)
1 x GE LED lightstick bulbs(2 pack of 75W)
1 x Suave Infusion shampoo(coconut)
1 x Nivea In-Shower lotion(cocoa butter)
1 x Zim's Max-Freeze topical ointment
1 x Speed Stick men's antiperspirant/deodorant
1 x Crest Pro-Health toothpaste
1 x Sally Hansen nail color(breezy blue)
1 x Almay eye shadow palette(colors for hazel eyes)
1 x Revlon emery boards(two pack)
1 x Saline Soothers sample(coupon on back)
1 x Oral-B toothbrush
1 x Glide dental picks
9 x Lindt chocolate Truffles
2 x Butterfinger cups candy bars

Over $70 in regular retail of goodies.

Closeup shots of the goodies up for grabs......

I'll leave this giveaway open until Sunday, January 21st, at 11:59pm Eastern Time(that's my birthday!), so that gives everyone 7 days to enter this one.  On January 22ndth  I'll mark all the valid entries and use Random dotorg to pick a number and that corresponding person's entry wins.

*Please note the rules*
I'll post the name/Id of the winner on this blog and that person has 48 hours from then to contact me privately via email(my email addy is listed on my "About Me" page).
If I am not contacted via email I'll attempt to contact the winner via the email they supply with their entry and if that email is not responded to within another 48 hours I'll pick another winner.

There are three ways to enter--1 Daily and 2 One-Time Only........

1. Leave a comment every day.

2. Be a follower of this Blog(Hit the "Follow" button on the right hand side bar.) Let me know if your comment for this entry the name you follow under to verify.  You can do this entry once.

3. Post on your own blog(or on your Facebook page)about the Giveaway and leave a link in your comment/entry to where I can find it.  You can do this entry once.
In your Daily Entry tell me in your comment......something like what here is the thing you most want to win, if you like the cold, if you like to do Winter sports, how cold is it usually where you live....stuff like that.

Disclaimer--This giveaway is open to those with mailing addresses within the US only.
As the cost of postage to foreign countries has gotten to high I am sorry to say I can no longer afford to mail boxes outside the US.  These giveaways are not sponsored by any companies, I pay for it all(cost of items given away and the postage to mail it all)out of my own pocket.

***PLEASE NOTE***

Please make sure there is a way for me to contact you in your comment.

If you're not a registered Blogger User with your contact information on your User page, please put your email addy in your comment or email me your email addy privately when you leave a comment so I can get a hold of you. If your Blogger associated user profile is a GOOGLE one with those Google Circles nonsense I CAN NOT CONTACT YOU as Google Circles doesn't show your contact info.

If I can't contact you then you can't win.  I am still having to disqualify entries due to this issue and I sure don't like doing that.  Thanks!

So let's get this started!

Sluggy

A New Year Doesn't Mean Spending More Money

Every year when January rolls around the corporations pull out their "New Year" tricks.
You know what I'm talking about, don't you?

The "You Need to Buy Containers/Etc. to Get Your Life Organized" mantra and they try to sell you shiny new containers, filings systems, storage boxes, etc.

But most people don't have an organizing problem, they have a "too much stuff" problem.  Ok, some folks have both a stuff problem AND and organizing problem. ;-)



Just organizing your stuff when you have too much of it will only solve your organization problem for a short time.
So let's not fall for the "if we buy more/new containers for our stuff it will solve our problem" trap.
Stop buying stuff AND containers!
Keep your money in your pocket.
And get rid of some of what you already have.
My original post about all this from Jan. 2013 is HERE if you'd like to read it.

The other New Year trick is the "You Need to Buy our Diet Product/Plan/Fitness Tracking/Equipment to Lose Weight" mantra.
All sorts of diet foods, vitamins, supplements, diet programs, gym memberships go on sale in January of each year without fail, luring folks into a better life with promises of being thinner and fitter.

Again, you don't need to buy special foods, equipment, join a club/gym/diet program to lose weight.
Find free ways to exercise(take a walk), hold yourself accountable(tell someone about your plans/goals or do your health plan with a friend or family member),eat differently of the foods you can and do already buy(or buy better foods to get you to your goals).
You shouldn't have to spend extra money to reduce your bulk/get healthier/get fitter.
And after all, these merchants are just selling you a set of "tools", tools you may not necessarily need to achieve a better health goal.  You probably already have what you need to achieve a lower weight/better health.  You just have to believe in your own power to reach those goals.

What things do retailers lure you into the stores in a new year that you fall victim to?


Sluggy

2017 Christmas Budget/Spending Autopsy

Ok, so calling this an Autopsy is not very festive or cheerful.
So call it "The Post Where I Talk About What I Was Going to Spend for Christmas and What I Actually Spent for Christmas".
Whatever works for you.....

I budgeted $850 for Christmas spending in 2017.  Except for what Hubs spends on gifts for me, this is our entire spending budget for Christmas.
Last year I budgeted $1600.00 and we spent $793.72.
So I based this year's Xmas budget on what was spent last year plus a little more.  Since we weren't traveling for Christmas again in 2017(couldn't travel Xmas 2016 as Hubs had a broken leg)I figured the amount spent should be well under $1K.

I have been tracking our Christmas spending since 2010--
2010.........$1000 planned/$881.64 spent
2011.........$1300 planned/$851.32 spent
2012.........$1000 planned/$1020.48 spent
2013.........$1650 planned/$2164.77 spent

2014.........$1900 planned/$1742.87 spent
2015.........$1800 planned/$1583.94 spent

2016.........$1600 planned/$793.72 spent


How do I arrive at a budget for Christmas?  Nowadays I look at what we spent the previous years(because I have a full accounting for the last 6 years or so on the blog)and see where we did well and where we did "not-so-well" with budgeting and add in any unusual things we plan to do and after some papers are balled up and thrown away and there is one sheet left with lots of writing on it(as well as writing scratched out on it), we have a plan and a budget. lolz

No, really.....I look at possible spending categories and what I think we will use in each one.

I generally use c/c points to get gift cards for free(to either give as presents or use to buy the presents to give)plus I buy a bit here and there during the year when a deal presents itself and those items are cash flowed from our regular monthly income.  I have been known to reserve blogging revenue, rolled coins and/or cash rebates from grocery purchases during the year to pay for Christmas expenses.
I generally don't set money aside each month throughout the year(like a Christmas club account or actual money in an envelope earmarked for Christmas spending)since we had a large cushion of cash in our checking and savings accounts and I can just pull from those sources when I need money to spend on Christmas stuff.  Since Hubs retired mid-2017 I will have to budget for Xmas better in the future.

But if you don't have extra cash lying around it is a good idea to take funds during the year and earmark them for the Holidays.
There are many ways to save ahead for Christmas.....make regular deposits to a dedicated account or a Christmas club at a bank, use a one-time windfall like a bonus or a tax refund, etc........so use whatever works for your situation.

The only unacceptable plan is to GO INTO DEBT for Christmas!
Better to not spend on Christmas than to endure the grief/angst/anguish/stress by going into debt buying crap at Christmas you can't afford and having to pay off the bills incurred sometime in 2018, or 2019 or beyond.

So we went into the Holidays with $850.00 budgeted to spend.

Here is where the funds were allocated.......

Shipping gifts/mailing Holiday Cards  $40.00
Gifts for immediate family(includes any cash gifts)  $600.00

Gifts for extended family & friends  $50.00

Electricity for lights   $10.00

A Christmas eve meal and show or movie   $150.00
Christmas travel expenses(lodging, food, gas, booze)   $0.00
Charity  $0.00

And here is where the money actually went.....

Shipping gifts/mailing Holiday Cards  $30.47

Gifts for immediate family  $567.99

Gifts for extended family & friends  $53.07

Electricity for lights  $10.00

A Christmas eve meal and show or movie  $184.09
Christmas travel expenses(lodging, food, gas, booze)  $0.00
Charity  $0.00
TOTAL SPENT...$845.62

Here are the Spending Details....

$30.47 *Shipping/Mailing Holiday Cards & Gifts----$9.53 UNDER budget
We sent out 23 cards(2 were put into packages and not mailed separately in envelopes) and mailed 1 package to my brother and his wife and 1 package to a friend.  Stamps cost $10.29 and the cards I had already from previous Christmases.   The postage for two packages was $20.18.

$567.99  *Gifts for family---- $32.01 UNDER budget
Last year I spent $542.45 on gifts for family so I spent $25.54 more this year on the family's gifts.  Family included 4 people--Hubs, 3 kids.  $350 of that $567.99 was cash gifts.  We had 2 less people to buy gifts for this holiday(Eldest no longer has a SO and Daughter's BF was not here for Xmas).

Here is how I kept the cost of gifts a bit lower than it could have been this year--
*  I cashed in points on my credit card and/or hotel program card for free gift cards to give or use to buy items to give. (I wasn't very successful at this strategy as in year's past but I still saved some by using it.)
*  I acquired a new back-up credit card and earned $70 in Amazon credit for that and used the credit for all but $14.67 on a coffee grinder for Hubs big gift.
*  Some clothing bought at Kohl's using Kohl's Cash/sales/discount codes.  I found some sneakers Daughter wanted in March and used discounts and Kohl's Cash to get them for under $10 OOP and hid them from her for 9 months. lolz
*  The last 20% off weekend at Big Lots in 2017(in October-they never run these near the Holidays) saw me get some items for cheap.....already low prices plus 20% more off when bought that weekend.
*  I picked up items/souvenirs on our road trip when I spied a "deal" and tucked those away for Xmas.
* Lots of stocking stuffers were items gotten at Rite-Aid over the course of the year for no money OOP.
Other stocking stuffers were gotten at the grocery store for free after coupons and others gotten as giveaways/freebies from companies.

$53.07  *Gifts for extended family---Over $50 Budgeted Amount by $3.07

We spent a bit more on the nephew's gift this year since I gave him a Rite-Aid procured gift card(so I got Plenti points but paid full price for the card)instead of using some credit card points to get a gift card for free.  His dad's food basket was foodstuffs I used sales/coupons to get.

$10.00  *Electricity for Lights----ON Budget
We used the smaller tree this year(less lights than a full size tree)and Hubs was able to do the outdoors lights too which was the same stuff we usually hang outside.

$184.09  *A Christmas eve meal and show or movie----OVER budget by $34.09
Dinner for 7 this year and 4 of them got booze(never cheap).  After tip we spent $184.09.

$0.00  *Charity----NO Spending After shelling out for the "rescue misson" expenses we were tapped out in the chairty department, and will be tapped out for some time to come.

$0.00  *Christmas travel expenses(lodging, food, gas, booze, cash incidentals)----NO Spending We didn't travel this year again as the Eldest came home for the Holidays for the first time in 3 years.


All totaled, this year I budgeted $850 and we spent $845.62, so $4.38 under budget overall.


Thoughts for 2018--
I think I'll keep our budget at $850.00 for next Christmas.  We aren't hurting for money but we are on a fixed income with Hubs retired now.  Plus all of our kids are 21 or older(and 1 is established in a career now)so I don't feel the need to spend so much on them as when they were younger.
For our income and our needs, I think this is just the right amount to splash out on Christmas celebrating.

If you kept track of your spending for Christmas, how did you do?
Did you spend more. less or right about what you planned on spending?
Did you have any money epiphanies when you look back at the Holiday plan?
Do you see anything you'll change about your spending for Christmas 2018?

Leave a comment and let us know how you did and what you learned about yourself & money this year!

Sluggy