Though I’m not close to retirement myself, one GRS reader recently sent me a link to an article from the monthly newsletter from AARP (the American Association of Retired Persons). In the April 2009 issue of AARP Bulletin, Elizabeth Pope wrote about how to live well on less money.
Pope profiles three families who have structured their personal finances in order to pay for necessities — and luxuries — now that they’re finished working. One family shares housing with several other couples. Travis Thrower practices voluntary simplicity, but doesn’t skimp on the things that are important to him. And Sky Yardley and Jane Dwinell follow the advice set forth in Your Money or Your Life.
The most interesting part of the article to me was the sidebar featuring the annual budget from the last couple. Yardley and Dwinell don’t make a lot ($21,500 through investment income), but they have a comfortable lifestyle. Here’s their budget:
House: $3,600 (taxes, water/sewer, utilities, trash, insurance, supplies for house—cleaners, shampoo, hardware, linens, etc. — and for pets: 1 dog, 2 cats)
2 cars: $2,600 (gas, insurance, upkeep, registration)
Food: $4,800 (garden, monthly bulk food order, CSA share, grocery store, eating out; includes France)
Beer/wine: $1,200 (includes France)
Health care: $1,000
Clothes: $500
Sports: $1,000 (primarily downhill skiing, passes and equipment)
Entertainment: $100
Gifts: $500 (holidays and birthdays)
Charitable contributions: $200
Trip to France: $6,000 (airfare and local transportation, boat insurance, port fees, canal pass, boat maintenance and supplies, diesel fuel, propane, Internet/phone) “The most expensive part is getting there,” says Dwinell.
I love looking at other people’s budgets. Any sort of glimpse into how other people spend their money can be helpful. That’s one reason I publish my discretionary spending every year. It’s fun (and instructive) to compare my annual spending with that of other people.
The Yardley-Dwinells spend $1200 a year on alcohol? That’s twice as much as I spend! (But I spend far more on food — especially dining out.) Just $100 on entertainment? “We decide what we want to do, then figure out how to do it for free,” says Dwinell.
She also says, “I’d rather hang my laundry on a rack by the stove and spend a couple of months in France every year.” It’s all about priorities.
To me, the most interesting part of this article is seeing that after their mortgage has been eliminated, the Yardley-Dwinells are able to get by on less than $2,000/month. And they have a good life. By keeping their costs low — and buy consciously embracing frugality — they’re able to get by on a modest income. (An income that comes exclusively through their investments!)
Many articles about retirement focus on boosting income. There’s no question that’s an important element to preparing for the future. Still, it’s refreshing to see a story about how average people are able to create budgets that let them meet their expenses while also allowing them to enjoy retirement.
[AARP Bulletin: Fabulously frugal: Living well on less money]
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It’s an interesting anecdote for the “renting is cheaper than buying” camp (or the opposite one, too, I guess).
Could they still afford this lifestyle if they had to pay rent? Presumably they’d have been able to save more money, and therefore have more investment income.
Personally though, this is one of the big reasons I plan on buying a home — so that when I retire, I don’t have to make payments on it every month.
Also, if you take out drinking, vacationing, and skiing, it’s a lot easier to make your “entertainment” budget pretty small. They’re also lucky to both be in good health at retirement age.
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“… buy consciously embracing frugality …” Is that a Freudian slip? It made me laugh.
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I too like to look at other people’s budgets. They have done without a lot of things…$100 for entertainment for a year??
A couple of comments:
Health care – they basically don’t have any which is pretty risky. One big bill and there goes the retirement for both of them.
Houseboat – it mentions they own one but it’s not in the costs. This can’t be cheap.
Sharing house/cars – the article also mentions they split the house/car costs with their two (working) kids – this helps explain why those costs are so low.
@Tyler – presumably if they sold their house – they could probably pay for rent from the house proceeds income.
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Housing costs at $3,600 per year including taxes!?!?!?
Real estate taxes alone are about $4,000 per year where I live.
Something in the original article but not in the summary here is the following nugget:
“A wood-burning cookstove provides heat. Modern conveniences include a refrigerator, freezer, washing machine and high-speed Internet connection for three laptop computers, but the family does without a TV, dishwasher, microwave or clothes dryer.”
I guess hanging up the clothes on a rack by the stove is a necessity now, isn’t it?
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There’s a recurring theme on the posts on this blog – maybe an unstated one – which is charitable donations. $200 a year is a good start – more, I’m sure, than many give. But it seems small in comparison to the $6K trip.
In recent posts, we’ve heard about people paying cash for cars, for trips, for wine under $12 and for spare shoes. I think it’s worth taking another look at what types of social responsibilities and opportunities come with wealth.
I’m not intending to be judgmental – my own charitable contributions are small, and they pale in comparison to my travel budget. But should they?
I’d love to hear from people who are more generous – who tithe or come close to it. How did you start? Is it a burden, or do you enjoy it, or both? And when you’re planning for retirement, do you plan on continuing to donate during retirement?
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The budget example given here seems unrealistic on so many levels (unless one is forced into it because one cannot generate income for some reason, in which case it’s simply reality). But, I have four (grown and married) kids (in two cities plus one overseas) and a large extended family (in five different cities) so I have more travel and spare bedroom needs than this budget would allow.
As to charity, I have given over the years but I feel that people waste what they don’t earn for themselves (i.e., that they are given), and thus I feel donations to organized charities are wasted to one degree or another. I feel much better giving to individuals that I know are worthy and in verifiable need – especially those who are working to improve themselves.
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The couple highlighted here does not have health insurance, instead paying cash for care. Maybe that’s OK for a broken arm, but if one of them got into a car accident or had a heart attack and needed a prolonged hospital stay, they’d be bankrupt in a hurry. That seems incredibly short sighted to me. As a physician I can see how easy it is to rack up a bill in the hundreds of thousands of dollars. If you can’t pay your bill, who pays? The hospital and the taxpayers… That makes me upset. Everyone should have health insurance.
@ Paul in Ashburn: If you think charities are in the business of giving away free money, you ought to take another look at charities. What about charities that benefit the environment, or are trying to cure cancer, or any one of innumerable other charitable endeavors that just involve the greater good. Giving money directly to ‘worthy individuals’ has merit but it is not at all the same as giving to charity (and it’s not tax deductible!)
If you don’t care about the environment, children, education, or health, etc. And only like giving money to people who are hardworking and will pay it back after they have used it to get ahead in life, you ought to check out Kiva.
http://www.kiva.org – I’ve made almost 15 loans and only one has defaulted. It’s a fantastic system of poverty eradication.
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I tithe+ and was shocked to see the $200 amount. I thought, surely that must be monthly…
Tithing is a large part of my budget, much higher than my travel/vacation costs, more than my year’s rent and more than my taxes.
But it is worth it to me; I love knowing I am helping someone. Of course I will continue to tithe in retirement.
I started tithing when I was a small child. It was an expection in the home I grew up in.
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My dad brought me this issue of AARP last week when he visited me. It is interesting to read about the various lifestyles and how people choose to live in retirement. What one person likes; another does not. I agree completely that we all have our priorities. My parents were frugal in many ways, but when we traveled, my mom only liked to stay in very nice hotels with a view. The St. Francis in San Francisco and the Contemporary at Disney World come to mind. Yet, she was happy buying clothes at K-Mart. That is the beauty of making a budget – YOU decide how your money will get spent.
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Regarding charitable contributions, we give about $350 per month to three charities plus I give to things like the Heart Walk, which my son walks in, and the AIDS walk, which my daughter walks in plus other odd amounts during the year. Since I founded a charity that’s totally run by volunteers (including myself), I know what it’s like to survive on donations. Let me tell you that the donations we get are never “wasted” as a previous poster mentioned. As volunteers, we spend a lot of our time making sure that the donated money is used for its stated purpose. I don’t know if I can sustain that level of giving in retirement, but I would try to budget a fair amount–definitely more than $200 a year–in relation to my own spending. But giving gives me satisfaction, and I imagine it doesn’t provide that same intrinsic value for other people.
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@Lisa (#2)
I hate my stinking homonyms. I’ve had that problem since FIRST GRADE. You’d think I would have licked it after nearly 35 years, but nooooo…
@AC (#5)
There’s no question that charity/tithing is one of my blind spots. I’ve written about it a few times in the past, but more often than not, it’s something I don’t think of. I wasn’t raised in a culture of giving, and it’s not a habit I have. I’ll try to explore it more in the future.
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Paul in Ashburn, you sound like a first class jerk.
I’ll bet if you’re ever down and need a helping hand, some one more charitable than you will be there to help. Think it won’t happen to you? It can happen in an instant. A house fire, an illness, an accident and suddenly you’re the one who needs the assistance of a generous volunteer.
I’d be interested to hear if anyone thinks about charitable giving like they do a portfolio.
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As others have pointed out, the “$100 for entertainment” figure is misleading at best. The true figure is closer to $9000.
Unless we’re using the Red Queen’s dictionary, the word “entertainment” does *not* mean “everything but the beer, wine, downhill skiing, and trip to France”.
If they’re too intellectually dishonest to define their entertainment as entertainment, I’m not in a hurry to seek financial advice from them.
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I guess the caption for that category should be “OTHER entertainment”.
If they spend all their time drinking wine and skiing in France, the budget for movies and minigolf would logically be quite small.
However, I give more to charity than they do – a lot more this year – and like JD I consider that an area of my life that needs work. Although if they spend a lot of time volunteering, that contribution probably has much greater value.
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There are too many judgmental people here. What people do with their money is their business. Trying to shame people into giving…that’s kind of low.
And for what it’s worth, the people I personally know who give millions to charity every year do it for the tax write-off. They’d rather decide where their dollars will go than let the government do so.
And the ex-boyfriend’s father who donated tens of millions to charity every year…well, he wanted to help the next generation but also his name on a building.
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I wish J.D. had the opportunity to follow up with this couple to discover what their medical situation is. I can’t imagine $1k covering insurance premiums, prescriptions, deductibles,etc for an entire year.
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J.D, why do you keep on saying that you were not raised in a giving culture? It sounds like you are using that as an excuse not to give but be bold and say you don’t want to give. You pull out this card from time to time when charitable giving is mentioned here. Are you playing the American blame game (i.e your parents, grandparents, teachers did nto show you….)?
Remember, it’s your money. I don’t know if other regular readers have noticed this too but the statement or rather excuse is always followed by you saying you’ll do something about giving in the future. Why not start now? Why the future?
Just been observing you. That aside, thank you for the marvellous blog.
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victoria,
I think giving is a completely personal and private thing. For years I have refused to give since I have been under the impression that I work hard for my money and others should do the same. I then ran into a guy from Germany who was donating a percentage of his income to a charity every month. I criticized him but when he showed me the pictures of the kids he was helping i decided to do the same. I now also give a percentage of my earnings to feeding children in Africa. And NO I do not even submit it for a tax deductible quincy, I do it because it is the wright thing to do. In addition to the cash I give we sponsor trips and give our time to this worthy cause.
Giving is not for everybody and people should not feel obliged to give. I personally feel that I have been blessed with a good income and will continue to give (time, money and skills) to the cause I have selected, but I will not criticize anybody who elects not to do the same.
When you budget, whether that is for your old age or our just to make your budget balance, the key is to include everything. The article that JD published here is a good example but cannot reflect ALL the items. Drafting and following a comprehensive budget is one of the keys to successful financial wealth creation and a stress free life.
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I’ve met Jane Dwinell, although I didn’t realise that she was a frugality devotee. She used to be a UU minister, and still does a lot of really important (to us) work within the movement. That’s actually the more interesting end of their story. According to a Vermont paper, after reading YMOYL she decided to go to seminary – lots of people retire well eventually, not everyone starts by making a serious lifestyle choice enabled by frugality
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“She also says, “I’d rather hang my laundry on a rack by the stove and spend a couple of months in France every year.” It’s all about priorities.”
Wow, I hang my laundry out too but believe me, it would take a long time to save enough for a couple months in France. Of course, maybe my priorities are screwed up?
$200 for charities. I’m embarrassed for them.
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Wow, there certainly are a lot of judgemental people on here regarding this couples’ $200/year charitable giving. Don’t be so hard on them. That’s $200/year more than I give to charities, and our household income is about 7 times more than theirs.
I agree with those who said this couple’s budget is unrealistic. These folks are just one emergency away from utter financial ruin. Their housing expenses are particularly troublesome, in my opinion. Is such a low housing expense sustainable? Does their budget make allowances for inflation? How do they sleep at night, knowing one major illness would wipe them out financially?
Maybe if they’d lived even half this frugally during their working careers, they’d have more saved for retirement and wouldn’t have to cut so many corners and mooch off their own children to make ends meet.
Whoops … now I’m the one being judgemental.
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Regarding charitable giving and tithing: We tithe 10% and give more to the church for specific calls and to other charities. It wasn’t always that way. We used to give $5/week to the church. So how’d we get there? We made a big jump one year to $300/mo out of pure faith. It wasn’t a tithe, but it was far more than we’d ever given. Then we took smaller, but still substantial jumps ever since – always with the faith that God would provide. And he has. We finally got to 10% when, after making our annual pledge to the church, my salary was reduced by 7% due to the economy and loss of profits. We have maintained our original pledge and made cuts elsewhere.
Regarding how it’s spent, I trust God to use it to his own glory.
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@Gee #12. I refer to the high overhead costs of organized charities. Some charge over 80% of the cost of raising money and pass on less than 20% to recipients (see Forbes magazine’s reports). I believe giving in a more direct way (tax-deductibility aside) is more efficient. So, giving is good. Giving but getting stripped by (potentially wasteful) overhead, is not so good.
@Quinsy #7. I don’t fault you for donating to your chosen causes (environment, children, education, or health). I just want to see 100% of my donations going to the individuals who need it (and they don’t have to pay it back – but most ethical people who have benefited from charity DO pay it back by giving to others later on when they become able to do so). It’s an efficiency thing, not a judgmental thing.
Giving to others in your own way – good. Being able to provide for yourself and your family without charity – priceless.
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I’m so glad you posted this article JD! I must admit this is the first break down of a retirement annual ‘salary’ I’ve ever seen. This is really helpful, as it gives me a good idea about what it REALLY costs to live after retirement. Of course I’ve noted the insurance discrepancies and such, but it’s nice to see a ‘real world’ example, not a hypothesis or W.A.G.!
As to the charitable giving, aren’t we all supposed to do what works for us? I grew up in a house that tithed, and through the years I’ve gone from stuanch tither to giving on a monthly basis according to what works for my goals and priorities. I can look in the mirror and say to myself without guilt, I give to my community and charities that I care about with my time and money as I can afford to! I trust that as I continue to be a good steward of my money and time, I will be able to do more as I go. I feel good about this, because I’m now giving because I really want to, not just because I think I ‘have’ to.
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Even in these times (or especially in these times) I hope people give more than 1% of their income to charities and not-for-profits!!
Try 10-15%!
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I don’t think this is unrealistic at all. Currently, my family of 4 lives on just over $30,000 take home , and that includes almost $800 of rent every month. If we own a home and pay it off before retirement and have grown kids (i.e. two less mouths to feed), we could TOTALLY make it on $21000/year. (We already live very comfortably.)
Especially if we invested in a Roth IRA so that there were no taxes.
Also, has anyone considered that maybe they have a retirement plan from a company that includes some kind of health benefit?
Also… as to their generosity… yes, their financial contributions are low, but the headline very clearly says that they use their time to volunteer for projects that interest them.
Why is a financial donation more generous than a donation of your time? Those of you who “tithe”… do you tithe your time as well, or is writing a check your easy way out?
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I have to laugh at people that call this budget “unrealistic”. Obviously it is realistic…since these people exist!
Just because it doesn’t fit into your definition of how to spend money doesn’t mean it’s not an option.
They only give $200, but it says in the story they quit their jobs and started volunteering.
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$300 and $350 a month on charity? That’s unreal!
I’m sure glad I don’t beleive in god or I might be tempted to do something crazy like that too…
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I think this article highlights one of the overlooked truths about retirement – your needs are unique, and so are your expenses.
This couple isn’t one illness away from poverty, they’re a trip to France away. Obviously they have enough discretionary spending to re-allocate at least some funds. Also, when they talk about entertainment they’re obviously talking about movies, theatre etc. and have generously specified their larger expenses for us to see. They’re not hiding anything.
I think it’s sad that people have reflected on this couple’s lifestyle with comments about how unrealistic it is. It works for them. Now how about you get creative about what might work for you? My grandmother took in boarders to cover the costs of her farm and travelled to stay with family, so her expenses were almost zero. Someone else won’t need their car, others will share theirs. Someone might share an apartment a la Golden Girls, while another will have a part-time business. The point is that you can think about how you can reduce your basic expenses in a way that works for you and perhaps keep up a trickle of income to place less stress on the need to save huge amounts of investment money.
Sheesh!
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Hmmmmmmmmmm I don’t see anything in their budget for saving or investing.
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She also says, “I’d rather hang my laundry on a rack by the stove and spend a couple of months in France every year.” It’s all about priorities.
That statement just saved me $150. I was in the process of buying a Roomba from Woot … I was literally loading the payment screen and switched windows to read while it was loading.
I snapped out of my consumerism and canceled the purchase. I have a vacuum. I have legs. I have time. Why do I need a robot to do work that I can do myself?
Thanks JD.
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I’m always amused at just how uncharitable the cries of “they don’t give enough money away” are.
I was always under the impression that the purpose of charity was to help others (or in the case of tithing to get yourself in your church’s good books) I didn’t know the point was to be able to get into online discussions and disparage others.
Like others have said the lack of health insurance seems a dangerous game to play, especially as they are regulars on a ski slope.
I’m also intrigued as to what would happen if one or both children moved out, could they still afford their lifestyle?
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Note that the article says that they spend their free time volunteering. They don’t say doing what, but I think that volunteering time is just as important, and possibly more important, than charitable donations since it requires more of a personal commitment than just writing a check. This couple might actually be contributing more than someone who tithes a lot when you consider the value of the time they commit to causes they care about.
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For those objecting to the apparent lack of charitable giving by the spotlighted couple, you might want to consider the fact that Jane Dwinell is actually Rev. Jane Dwinell — a Unitarian minister. The frugality of her lifestyle is part of her long-term commitment to “independence and self-reliance for Vermont families” (see, for example, her webpage at http://www.spiritoflifepublishing.com/newsletters.html). It is also a natural stance for Unitarians, at least in my experience (I was raised Unitarian in another New England state, Connecticut).
My objection is to the lack of provision for health catastrophes. Even the annual budget for summer travel will do very little to help in the event of a stroke. In the case of the Dwinell-Yardley family, they may simply be gambling that their luck will hold. But it probably won’t.
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I agree with Kevin M and Regan that the Yardley’s budget clearly is realistic because they’re real and it works for them. JD, I’m glad you highlighted this article; I sometimes doubt myself when I consider how inexpensively I’m planning to live in retirement (and the long-term benefits of how inexpensively I live now, except for wine) and seeing the myriad ways others do it reminds me that as long as my way works for me, it works. Period. I, too, will happily trade hanging laundry and cooking from scratch for travel and skiing in a couple of decades.
This article and your recent interview with your millionaire next door have been particularly interesting to me. I know they’ve been contoversial with your readers, but I have appreciated seeing a different view on retirement and wealth than I generally see in other places. Your neighbor John summed up my idea of what it means to be wealthy when he said he has enough to do whatever he wants, not just needs, but that he doesn’t want much. Thanks.
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I think some people are a bit too quick to look at the figures and make deductions based only on that.
I don’t give money to charity. However, I knit toys for kids, which I donate. I volunteer. I donate food. I donate clothes. All of that cuts the middle costs and can be more efficient (obviously, to run charities, you also need actual cash. But not having to shop for food, clothes, toys and so one saves time, and when volunteers are few and far between, their time is really precious.
Now, I’m not saying a yearly trip to France that’s several months long seems necessary to me (of course, I actually /live/ there so my perception is biased) and I can’t speak about the health insurance thing for the same reason. I also wasn’t raised in a very giving, charitable environment.
But the comments made me realise something. I never realised some things were “charity”. Giving to environment association, animal association, the SPCA, donating books, donating clothes, donating food… I don’t actually consider that charity. To me charity is “giving to the poor”. And as much as people might think what I’m going to say is outrageous, my opinion on charity is “it shouldn’t exist”.
Now, don’t get me wrong. I don’t mean “be selfish”. I mean that helping the poor should be the state’s business. There should not be poor people in a well-run state, in my opinion. Therefore, I am happy to pay taxes according to my abilities, and I’ve never thought of trying to pay less taxes. I don’t get the people who are trying to. Streets, hospitals, schools are built with these taxes. Why would you want to pay less of them? And as much as I like being able to donate to causes that are dear to me, it is good to have the state to make sure everyone gets something.
Otherwise, we have the risk of people giving to some causes, but never to others. People shouldn’t have to rely on charity to be able to survive. I find it outrageous that they’re not being taken care of properly.
So to me, charity will always be an “extra” something. For other countries (Every year, my school gathered food and supplies to send to Africa. It was a wonderful experience), or to give a little more for something that is close to your heart. But leaving so much to charity, to personal decisions, seems very unfair to me. We’ve all seen some very vulnerable people (the mentally challenge, the elderly, the disabled) with barely anything, who had to survive on charity only.
And that makes me sick. Charity shouldn’t be needed. People should be able to get along without it. It should just be a bonus, and extra.
Now, I wouldn’t say “since it shouldn’t be needed, I won’t give anything”, because that would be wrong. But if I lived in a place that is less… socialist, I guess is the word? I think I would fight at least on a local level to make sure it evolves. It shouldn’t stay that way, charity is a desperate measure for desperate times, not the norm.
And I repeat, this is only my opinion. I’d be happy to hear what others think about this, in a civil manner of course.
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@Kevin in #17 — Sky Yardley is 58, Jane Dwinell is 55, their daughter Dana is 22, and their son Sayer is 18. The parents are not living with, and “mooching off”, their children! Their children haven’t grown up and moved out yet! Their *children* are being required to share expenses, i.e. to pay rent while living at home when old enough to have a job. My 21-year-old son paid his share of the utilities and other expenses from the time he turned 18 until he moved out two years later. My daughter will turn 18 in six months and will have to pay her share of living expenses then. This doesn’t seem unusual to me, though, after all, maybe it is uncommon. (But none of my children has objected!)
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I agree that people are being richeous about the charity thing. How do you know if they don’t donate time to organizations? Some of these comments are like US weekly. This is a couple of paragraphs about their entire lifestyle.
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I don’t think this budget is realistic over the course of more than one year.
Wow…really surprised at how little is given away.
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Paul in Ashburn, where I live, charitable corporations aren’t allowed to spend 80% on overhead and all non-profits must publish corporate financial statements. A good charity will be registered and have an accountable board of directors.
Reading an article in Forbes isn’t a good enough excuse to just write off charity in general. A little research can help you find a charity that meets your expectations (as long as they aren’t asinine).
There were a few problems with a couple charities near me, but that doesn’t mean every charity has the same policies. I know many people who work in the non-profit sector and I volunteer on a non-profit board. The staff and volunteers I know are accountable and respectable. No one is trying to cheat anyone.
It’s very inspiring to see their passion in action. That is priceless. There’s always going to be some overhead and some activities require more than others. What’s improtant is that the work is worthwhile and the organization is accountable.
A great organization not only helps today, but is strong and stable enough to continue its work in the future until it is no longer needed. No one would expect businesses to be set up as individual customers appeared. You need a business plan and to be organized and have knowledgeable workers. The same is true with charities. Like other corporations, we have strategic plans, which include how to increase efficiency and the best way to provide our services.
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Paul in Ashburn, I shall also respond on the subject of charities.
I agree that you must look up your charities to ensure that they are using money effectively and efficiently. It is now easy to find this information on the internet at Charity Navigator etc. So it is quite easy for me to make sure that all my chosen charities put more than 85% of their funding towards programs.
It makes sense to give so that 100% of your money goes to a person in need, and I definitely give you credit for giving. I was just pointing out that there are a lot of other fantastic things that charities can do in this world aside from hand someone a couple of bucks.
I find it heartwarming that so many people are passionate about charitable contributions on this blog. You all are wonderful people!
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I think a lot of critics making comments here are missing the point. This post wasn’t made as an example of how retirement money should be allocated. It was simply showing that you may be able to live off less retirement income than you imagine. This can take an enormous burden off of many people who, though they are frugal, are unable to sock away thousands and thousands of dollars to retirement funds each year.
Anyone who examines another person’s budget will quickly realize everyone has different priorities and different circumstances. We are not supposed to match this couple’s budget (or anyone else’s for that matter). We are supposed to take from it the idea that we can still live a good life in retirement without endless cash on hand.
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I think there have been a lot of scare tactics used over the years by people in the financial services industry to make us think we needed big money coming in every month as retirees, or we will have to eat cat food. I love this common sense approach.
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On charities: I think it’s Child’s Play that was started by the guys at Penny Arcade, and as far as I know, there is no overhead– rather, they take on the overhead because they can, and donations go straight to the kids.
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The article says that “The family has chosen to go without health insurance, preferring to pay cash for care” That is not a good idea. Personally I think its reckless. As others have pointed out they are one illness or serious injury away from financial ruin.
(I thought I replied yesterday but it might have gotten lost in site the maintenance. So sorry if theres a duplicate.)
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@Gee #30. Thank you for your clarification. I understand and agree.
@quinsy #31. I also thank you and understand what you are saying.
Charity means many different things to many different people. It’s difficult to adequately convey what we mean in depth in this forum. I thank all of you for trying to assume the best possible meaning of each others’ words. We’re all in this together!
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I LOVE this idea! Live simply, but retain the ability to give to others and to travel. . .
I am wondering about one thing, though: how is it that two retired people are able to spend less than $100 a month on health care? Do they not have health insurance? Stubbing one’s toe in this country can cost hundreds of dollars—I’d like more information about inexpensive health care for retired folks, especially the many who have pre-existing conditions or previous diseases (such as cancer) that would make health insurance quite spendy. . .
I’m also nowhere near retirement (unfortunately) but am thinking ahead. . . . Thanks for the interesting post, J.D.!
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I did not grow up around charitable giving but as an adult, I have embraced this value, contributing up to 10% of my income. During these times, I have never been in “need” and was even able to pay cash for most of my wedding. I think it is true that the more you give the more you will be blessed
Unfortunately, that has significantly slowed down due to an unstable job situation and disagreement with my husband on the “right” amount. I hope to be in “joyful giving” mode again someday. One cannot be so poor that he/she has nothing to give, time – if not money.
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This is a great post. I don’t know about the reality of their specific numbers but I do know from my own experience in helping people plan their finances that most people who are 55 and over can live comfortably at age 65 IF they have no more debt payments and preferably own their own home. This is very achievable for most people, even if they’re already 60. I know this is true by looking at client’s actual numbers. Unfortunately these clients had been “advised” to not pay off their mortgage early and even if they were nearing retirement most of them had most of their retirement nest egg in high risk, high fee mutual funds. When we looked at their numbers we found they could usually pay off 20 or more years of mortgage in 5 years or less, secure most, if not all of their savings and again they would be fine even if their Social Security was a large part of their retirement income. I can’t tell you how excited and relieved they were seeing their new numbers and plan, and upset at the bad advice they’d been sold. This is hard to totally explain in one post but there was a great story on 60 minutes a few weeks ago which you can watch on their website called “401k Fallout”.http://www.cbsnews.com/video/watch/?id=4955194n This helps explain how most people have been “sold” mutual funds as their only viable retirement savings option. The stock market/mutual funds world is just a big business. The very sad part to me is when good people are told by their “expert advisor” that these mutual funds are their only “intelligent” option and they believe it because they figure their advisor should know. If you are 50 or over or care about someone who is, realize there are simple very safe solutions to people’s retirement needs but you won’t hear about it from the typical “experts” because they’ve either been trained a certain way or they’ve got ongoing commissions to make or both. What I teach people is unconventional(it wasn’t 30 years ago), and usually takes about an hour, but it’s very common sense and when they see their own plan with their own numbers they get it. Personal finances and investing aren’t that complicated. Today they are made to seem complicated by salesmen who want people to “just trust them”. There are good options. I hope this is helpful.
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@ whoever said:
“$300 and $350 a month on charity? That’s unreal!
I’m sure glad I don’t beleive in god or I might be tempted to do something crazy like that too…”
(It’s not showing me the author’s name at the moment, sorry)
I just want to point out that
a) 300-350 might be a lot, or it might not be that much. It depends on the income, it depends on the person’s priorities. It would be more than 50% of what my husband and myself earn, for instance, we couldn’t give that much. For some people, though, it’s nothing.
b) whether you believe in God or not is not relevant, in my opinion. Of course, if you don’t, you probably won’t be giving to a church, for instance. But you might give for the environment (you live on this planet anyways), for children, for animals, for people in general. Whether you give or not is yours to decide, however don’t say it’s because you don’t believe in God. Lots of other people don’t, but the way you act depends on other things. Many people in the past, because they didn’t believe in God, have thought that there wouldn’t be a God to help other people, and therefore it was their own responsability. Not believing in God can be a reason to give, too.
What I mean is, donating time and money isn’t a matter of religion, of political party or anything of the like. Who you donate to will depend on that, but whether you donate or not, I think, can’t be reduced to this only. I don’t want anyone here to fall into a pattern of “atheists/liberals/christians/republicans/group X don’t donate as much” or something.
This being said, if you don’t want to or can’t donate 300-350, well then don’t
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