My original idea for my blog site was to share how much it cost us to live once I stopped working (and to show what I did alongside that). Now that my first full non working month has finished, I've crunched the numbers and am ready to share them. A couple of things before I do:
1. A reminder that we are living in Dubai at the moment, but I have converted the costs into GBP and USD. My view is that Dubai can be an expensive city. Although your circumstances will probably be a bit different, I still think that our experience can give you an idea of what your own costs may be.
2. One month of cost data is not enough to draw any conclusions. I think it needs 6 or 12 months of information to come up with a reasonable average monthly spend. I'll publish new costs each month, along with year to date total and a monthly average, so come back each month to see in which direction we're heading.
3. January was an expensive month. I've added some notes at the end of this post that give my thoughts on this.
Here they are, our costs for January 2017:
Our costs of £6,151 (or US$7,592) was much higher than I hoped they were going to be. My thoughts on this are:
1. I went online to a UK supermarket site to see how much an equivalent grocery bill would be in the UK. It showed that shopping in the UK would have cost 37% less, which would have saved £368 (or $455). Our grocery bill is for 3 people, but will reduce to 2 once Sam goes to university later this year, which will also reduce the cost a bit.
2. January included £964 ($1,190) to buy a new laptop and mobile phone which are not normal monthly costs (previously I had these provided through my job). We seem to keep our electronic items for quite a while, so they should last a number of years (as long as Sally doesn't drop her phone in the toilet!).
3. We spent £360 ($444) on a gardener and a cleaning service. These are luxuries that we should do without. Certainly in the second half of this year we will have neither of these costs as I can do this work.
4. Between sports shoes and equipment and race entries we spent £620 ($764) as I entered some expensive events and seemed to have to buy new gear all at the same time. Time will tell, but I would like to see the average of this spend come down to closer to £150 ($185) a month over the course of a year.
5. We spent £582 (or $718) on going out which I think is high. Sally and I had some ski lessons at the indoor slope followed by a meal out, which is probably more expensive than what we would normally do for a night out. Dubai is expensive for going out generally, so this spend is always going to a bit higher than if we were in Europe or the US.
6. Coffee shops - we should buy shares in them if we are going to continue spending this much with them! Sally gets a coffee on her way to work most mornings, and I go quite often as well it seems. Although I'm happily not working, I enjoy using coffee shops as my "home office" for the social contact.
7. Clothes, shoes etc - I think we may see this go down over the year as an average, but we'll wait and see for now.
8. Holiday costs are mostly getting ready for our ski trip. They will be high again in February, which is when we actually go skiing, but should reduce after that. I'm sure as an average over the year the cost will reduce.
9. Other costs of £553 (or $683) is mostly the cash that we had taken from the bank in January but was still in our wallets at the end of the month. Arguably this should not be included in the January costs, but my view is that this will average out over the course of the year (for example, we may show lower costs next month as we had some spare cash in our wallets left over from January that we will use in February).
Maybe, with that list of 9 things, I'm just trying to make myself feel better and pretend that we're not really overspending. Alternatively, I think it is me starting to understand our spending for the first time and therefore being able to consider a budget (we didn't do this when I was working as we had quite a good surplus of income over expenditure every month so didn't need to worry about it).
So considering a budget in overall terms, I'm thinking that we had costs of £6,151 ($7,592) in January, but for budget setting I am going to say that I take off the unusual laptop/mobile phone purchase of £964 ($1,190), the gardener/cleaner of £360 ($444), what I think is the higher than normal spend on sports clothes, equipment, race entries of £470 ($579) and the cash that we had left over at the end of January of £553 ($683) but which was included in the January costs as if we had spent it. Even though there are some other areas where I think the costs in January were a bit high, I am going to leave these as they are for now, as they may offset some other unexpected costs that crop up now and again (things like car insurance etc). Putting these adjustments together, I come up with an average monthly budget of £3,800 ($4,682). That is still more than I would like, I would be more comfortable around £3,000 ($3,700) per month, but I am conscious that living in Dubai is more expensive than where we will finally settle down, so I think these lower figures maybe achievable at that time (we would save a further £368 ($455) simply on grocery shopping if we were in the UK for example, and going out would be cheaper). Anyway, with only one month of data, there is not enough information yet to get too carried away, so it is time to post this and wait to see what the February spend tells us.
A couple of last notes, February is going to be a bit unusual as we are going on holiday, but we will see what that does soon enough. Also, you may have noted that there is no housing cost included. I feel that many non-workers/retirees will have their own house that is paid off (and this is probably the situation that we will be in when we settle down), but for now we are living in rented accommodation and the rent is normally paid once per year which will be in June for us.