How much do you spend per year (debts, accounts, dollars)

[evilnewbie]

In the end, I will have nothing cause I will have spent it all... or die trying!

[mysticaltyger]

Originally Posted by wheelsup

Spending your money on Chinese goods doesn't help, but spending it on US goods certainly helps..

I agree 100%.

Originally Posted by wheelsup

Savings rate is overrated, there will always be people that save and always those that don't..

I completely disagree here. A moderate to high savings rate is a great shock absorber. Sure, there will always be savers and spendeers...but in aggregate, countries with citizens who save tend to do better than those countries whose citizens don't. A high savings rate tends to keep the interest cost on government bonds down.

Originally Posted by wheelsup

The key is, are they simply not saving or are they going into debt buying imported goods? That is the worst thing that they could do to "help the economy"..

And I'm saying those who save tend not to go in debt for stuff. The two go hand in hand. It's true for countries as well as individuals.

Originally Posted by wheelsup

I bought around $2k in USA made tools over the past two months, you can bet that helped our economy. Part of the reason China still doesn't really have a middle class is because all they do is save, also Japan's economy has been dead for the past 2 decades because their citizens don't spend, all they do is save save save. Saving helps no one but yourself..

Your example of buying American made stuff is certainly a good one, but beyond that, I disagree.

I do want to point out however, that HALF of our trade deficit is with OIL. We like to blame China a lot (and there's some truth there), but I find it shocking how we ignore the fact most of the complainers on CD forums about cheap goods from China completely overlook the issue with imported oil, even though we've known we need to do something about it for almost 40 freakin' years now!!!

China doesn't have a large middle class because for many years they had a communist "comannd and control from the top" type of economy that stifled initiative and innovation and effectively made everyone equal--equally impoverished that is (except for an elite few, of course). Now that is changing but it takes a few generations to catch up with high income countries. The savings rate had nothing to do with it.

Japan's savings rate has dropped over the last 20 years. Japan's corrupt government is the problem. Japan would have already defaulted on its debt a long time ago (llike Greece) if it's citizens weren't savers. Their problems are related to a corrupt government and a low birth rate and a lot of old people to support.

Originally Posted by wheelsup

If we were to live here like some people do (spending nothing, saving everything) our economy would be in shambles..

While this example is true, the chances of it happening are so remote, it's not even worth considering.

I'm talking about taking our savings rate from 5% to 10%. That is reasonable, and while it might hurt our economy in the short run, it would help us a lot in the long run. Just about every economist from across the political spectrum would agree with this.

Originally Posted by wheelsup

P.S. A million $$ in the bank at 50 means nothing if you get hit by a bus at 35 crossing a street.

Oh, here we go again with the extreme examples . Humans are hard wired to think only of the present, as your example here proves. People and nations who can train themselves to think beyond instant gratification in the moment do better and are more prosperous than those who don't. It's really that simple. It is possible to save too much? Yes. But we both know the chances of that happening in America are almost zero.

Scenario A: Person saves a lot of money & gets hit by a car & dies at 35.

Scenario B: Person doesn't save money and gets laid off from good paying job at 50, and not able to find another decent paying job.

Now, I ask you, which scenario is more common???? I think you know the answer.

I might add that in scenario A, if that 35 year old had a family, I'm sure his/her family would be very greatful to have those savings to lean on in a difficult time (although a life insurance policy would be even better).

[hartford_renter]

Originally Posted by Chemistry_Guy

When I filed my taxes this year, I was surprised at our gross household income, and my wife asked, Where did it all go? Being a math nerd at heart, I got out my spreadsheet and tried to break it down. The numbers here summarize my findings. When applicable I tried to use significant figures for estimated quantities.

Mortgage interest 5.6%
Mortgage principle 11.9%
Property Tax 2.9%
Income taxes (all) 19%
retirement 15.1%
Car payment 2.7%
Food (all) 8%
Utilities (cable, etc) 5%
Fuel <1%
dog related 2%
furniture 2%
home maintenence 6%
insurance (all) 2%
Medical 2%
travel 4%
Hobby(mostly guns) 2%
Other 10%

I don't know how much of this is considered "spending", but at least it gives me an idea of where my income is going.

Cool you spread it out a lot.

[dazzleman]

About $120k per year

[hartford_renter]

Originally Posted by dazzleman

About $120k per year

Thats pretty cool, you live in FC so it makes sense.

[Tober138]

Originally Posted by mysticaltyger

If you are spending 10K on eating out and still putting a good chunk away for retirement, paying cash for your cars, etc, that's great!

However, you might consider how much wealth 10K a year can bring. If you put that 10K a year into a good balanced mutual fund (Fidelity Balanced, Vanguard Wellington, T. Rowe Price Capital Appreciation, just to name a few) and you earn 8%, this is how much you'd have after....

This is all true. But, at the same time, if one is socking away money in the bank or the market for the future, and putting enough into their retirement accounts to be on track for their retirement goals, and they still have disposable income, why not spend it on the things you enjoy. I am a big believer in saving first, but I know people who squirrel everything away for retirement and live on a shoestring in order to do so. Life is short, enjoy it if you can...and remember, there is always the possibility that your could drop dead before you are old enough to take that first retirement distribution.

[miyu]

When I was making 17k, I would spend about 13k/yr. It's funny how spending goes up with income. Now I spend more than that in rent alone. :P

[mathjak107]

we are getting ready to retire fairly young and just looked at our expenses now and tried to equate them to what will be .being pre-retirement we are shifting our figuring to looking ahead . i found our planning once again going against the grain as we will spend as much as our income and portfolio allow us to do safely. thats the opposite of taking expenses and working forward.

we will back into the expenses from the income and adjust our lifestyle up or down to fit our income for the next phase of our lives in retirement. many try to predict from current expenses but we have a different view.

our whole lives we scrimped,invested, denied ourselves things and now reached the apex. now its time to reap the rewards of all that and live even better then we did while working because we no longer have to accumulate and grow our assets at the same rate and risk level.

the real question is how much risk can you withstand for a particular income level and then set your lifestyle for that income.that will be our expenses

.

[d-boy-80]

Originally Posted by mysticaltyger

I

I do want to point out however, that HALF of our trade deficit is with OIL. We like to blame China a lot (and there's some truth there), but I find it shocking how we ignore the fact most of the complainers on CD forums about cheap goods from China completely overlook the issue with imported oil, even though we've known we need to do something about it for almost 40 freakin' years now!!!



Japan's savings rate has dropped over the last 20 years. Japan's corrupt government is the problem. . Their problems are related to a corrupt government and a low birth rate and a lot of old people to support.

A lot of the oil that comes in. Is it refined? Besides I think 700Billion dollars of oil we buy from overseas. So that is 700Billion of the 1.9Trillion dollars a year. So that leaves 1.2Trillion left to other resources. But what counts is the percentages of who gets most of our trade money:China 19.3%, Canada 14.24%, Mexico 11.12%, Japan 6.14%, Germany 4.53% (2009).

And why is Japan's government corrupt?

[Escort Rider]

I spend about $2,500 per month X 12 equals $30K per year. No house payment or rent (it's paid off) and no car payment (it's paid off). I find I can live quite comfortably at this level, but I do not have expensive tastes in food or clothes.