Cliff and I went and talked to our insurance man today. We raised the deductible on both the old house and this trailer house to $1,000. With a little apprehension, we took off some things that we had been insuring.
I have told Cliff for some time that we would need to do this when he retires; we won't be able to afford the cost of that much insurance. Today he said, "Let's just do it now."
When we got home, for the first time ever, I wrote down a list of expenses we'll always have, even after retirement.
I made another list of things we can reduce or cut out entirely: Dish TV, for example; that's $40 a month. I told my husband I'm not giving up Internet unless I'm starving; after all, it's my main form of entertainment.
We don't have a big retirement fund; we will have to try and live on our social security. Scary, isn't it? Cliff's 401K isn't a huge amount, and we'll put that in savings as our nest egg.
It appears that we could manage to stay here on our place with proper budgeting, at least for a few years. Unless Social Security goes the way of the dinosaur; in that case, we'll be on the streets with signs that say, "Will work for food."
As I was doing all this figuring, something made me think of Dave Ramsey and his envelope system. It's actually a plan to help you get out of debt, and except for our property, our debts are paid. But it could help us stay on track.
I believe the idea is that you allot so much each pay period to groceries, clothing, medicine, and so forth; each of these has its own envelope. When the envelope is empty, you do without. Of course, this would not apply to medicines; you'l have to try and budget the proper amount for that, or a little extra. Cliff pointed out the high cost of owning a pet, and I labeled an envelope for Iris' care and feeding.
I decided to go ahead and use the envelope system right now for the things I can; this won't include utilities, house payments, insurance and so forth, because I pay those with checks. But using the envelopes for what I can will help me fine-tune our budget so I'll have a realistic idea of how much we really need when we retire. It might help me spend less, too.
You can spend $19 plus shipping on some sort of fancy envelope holder and special envelopes from Dave Ramsey's website, but I'm using plain old business-sized envelopes. What's the point of budgeting if you're going to pay $20 for envelopes?
Wish me luck. I'll keep you informed.