Sunday, July 14, 2013

Fixed Income Budgeting-and Random Sunday Thoughts

In no particular order........

  • As I contemplate life this Sunday morning, I think about my son-but not the way you might think. He has been raised most of his life in an urban village environment-riding subways and buses alone and with friends. He has walked alone at might coming home from the local hangout. He's driven in both good and strange neighborhoods after midnight, and his attire is generally on the hip jeans decent T-shirts and occasional hoodies. He has never, ever, in his entire life (even on a military base) been stopped and asked what he was doing, where he was going or if he belonged where he was.  I am here to tell you that if a strange man, not a police officer followed him and told him to stop, he would do one of two or maybe three things:  Run like hell, turn and confront, or perhaps have the sense to call 911 (boys aren't trained this way as girls are).  He would certainly not have stopped, turned to a large stranger and waited to see what happened.  But then, my child is white, Anglo-Saxon and protestant.
  • In addition to the season fruits and salads lately I have had two cravings.  First for a really icy root beer float and second for homemade custard pie. Since I'm living without air conditioning and it's 90 degrees, I imagine the pie will be for a later date, but the float is certainly in my future now.
  • Even though it's the middle of summer, I've been fascinated by some fall craft ideas-in addition to quilts and sewn items I create decorations and arrangements for clients.  I love this wreath because it says Halloween in a non traditional way-I may have to use it as a starting point.  Also I can see this flower arrangement being used for every season (it's two vases, one inside the other). The joy of being a crafter/artist is that you're working two seasons ahead. I suppose it's the same for writers and others as well.


As I look at my new living situation (my inspection is Wednesday but I don't expect anything major-the main issue is hardly any grounded plugs and no shut offs in the kitchen-something I believe can be negotiated) I am working more firmly on my budget.  In theory I suppose, all retirees are living on "fixed incomes" in that unless they return to work, what they have is all they have.  For those of us who live on a regular monthly income however, things are a little different. One the one hand, we don't have to do the figuring of what percentage to pull each year, and watch what is in the bank ebb or flow with the economy. On the other hand, what we get each month is what we get. Period. Yes, some of us have savings, but generally not the kind of amounts that people living off investments have.  

So, fixed income living can be more or less secure, depending on the amount of income.  For some folks, fixed income living is social security or disability and nothing more. In my case I am blessed to have a small government pension-not what it would have been had my husband reached full retirement and lived, but nevertheless a monthly amount. I am also blessed that as a widow I receive his social security.  I don't live rich, but I acknowledge that my monthly income is as much as many who take out their four percent (for example each year).  The difference is savings, which needs to be figured into that fixed income.

Even so, my kind of fixed income requires a little more budget finesse.  For one thing, I tend to budget monthly, in every sense of the word.  Yes, I look at my annual expenses, based on last year and I adjust that. But then I figure out a monthly amount for all of those expenses-including savings. I transfer those amounts to my monthly budget and work with those figures. And I adjust those figures so that not every penny is budgeted for-even though my budget includes savings and annual expenses or what Dave Ramsey would call a "sinking fund"

The final thing I do is that I spend all the money at one time. I suspect I am not the only retiree who does this. Even though I get "paid" twice a month, I make every effort to pay all the bills at a single time. I arranged in the past (and home to arrange when I move) to have all my bills some around a certain date of the month.  Then I put all the bills in a basket and sit down and pay them at one time.  Being a naturally lazy person who chooses not to leave the house unless I have social engagements (rather stay on my patio in the breeze) much of the time, I also schedule all those monthly things within a few days of my bill paying. This includes things like hair appointments, oil changes if they are needed and anything not food, gas, or entertainment related. I'm not sure this is a budgeting tool as much as it is an "I hate to do errands" tool, if you get my drift.

And now, I'm off to work on my adjusted budget-and help my poor sister slowly start downsizing and going through her things for the move. Yard sale anyone? How do you do YOUR budgeting in retirement?

4 comments:

  1. Decades ago, when my husband and I were young marrieds, we were touring through a neighborhood that interested us, thinking about buying our first home. My husband had just been hired as the assistant city attorney for our small town. We were touring through the neighborhood in my youngest brother's junker, proudly bought with his earnings from his first job. When we stopped to look at a house under construction and for sale, the guy who lived next door stormed out, angrily confronted us and asked us what we were doing there. Based on nothing more than the looks of my younger brother's car, he'd decided we didn't belong and he tried to shoo us off. This was daylight and the incident passed with nothing more than affronted feelings. However, I've thought about that incident often in recent days, and also on the cool mornings when I would greet the sweet neighbor's thirteen-year-old as she waited at the end of her driveway for the school bus, hoodie pulled up over her hair.

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  2. When I first started work 39 years ago, I was paid on the 15th and the end of the month. It was awful!! A long time to go thru until the next payday. Then they switched to paying us every 2 weeks. Much better! Now that I am retired, I receive my pension (no social security yet) once a month. I love paying my bills at the beginning of the month. I was never able to do that until I retired. I get all of my bills before the beginning of the month, so it works out great. It's so much easier for me and I don't have to worry about forgetting to pay something later in the month.

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  3. I worked for the State of Calif. for over 30 years and we got paid once a month so learned very quickly to pay everything at the beginning of the month and then try to allocate the balance throughout the month. Now that I am retired I too get paid twice a month; my State pension and my late DH's social security. My net pension is about as much as my take home pay was while working so I still pay all of my bills from that and the social security goes to savings or descretionary spending. I like knowing what I will get every month...makes budgeting easy and automatic!

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  4. Bev, in my case my ss is more than the pension because hubby died before retirement age. I have been thinking of putting the one towards regular fixed expenses, but Im still working on that one. I agree I like knowing what I will get every month-I just HAVE to get some savings/sinking fund in there.

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