Tuesday, September 14, 2010

How Much Could You Live On?

In Jim Yeager’s book, The Ultimate Cheapskate’s Road Map to True Riches, he states that earlier in his marriage he had it in his mind that if he made $40,000/year, he would be “set.”  He states that while he had a mortgage payment, he and his wife were actually living off of this $40,000/year comfortably and saving the rest of their combined income.  Now that the mortgage is paid off, they live on approximately $30,000/year.

 My question to you is, how much could you comfortably live on?

 For us, we are currently living on approximately $45,000/year.  We had 3 debts at the beginning of 2010 that totaled $25,120.85.  We currently owe $14,377.10 and moving in the right direction! Once our debts are paid off (freeing up $800/month in payments!), I am pretty confident we could live off of $35,000/year.  Once the mortgage is paid off, $30,000 should be a comfortable number for us. To clarify, I am referring to $30,000/year gross, not net.

 How would we do it?  I hate to admit this, but our debt is our biggest money leach.  Second would be our utilities (though we are trying to cut back.)  Third would be our mortgage & property tax (we do not have an escrow account).  Fourth would be “the farm.”

 What are your “money leaches?”

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