Way OT: Living on $7,000 per year

[EconProf]

Living on $7k per year is not only possible, but in some ways better than the typical American lifestyle on $40k per year. Check out this new blog: earlyretirementextreme.com
A really thorough and detailed description of how to do it (in the Bay area!) and the freedom and benefits it creates. Not so much miserly penny-pinching as challenging our assumptions of what we Have To Have. Especially good at ripping the advertisers who enslave us. Great feedback from critics and supporters alike.
Of course, the American economy would implode if these subservisive ideas took hold.

[UCGal]

Interesting lifestyle. He’s made some choices that totally would work for me (cooking from staples, growing veggies, using things till they are done, buying high quality to start with) and other choices that wouldn’t work for me…. (RV living)

I’m obsessed with retiring early…. and it definitely involves living well below my means now, and in retirement…. That seems to be the key.

[UCGal]

Another blog that’s along the same lines but with a slightly less extreme lifestyle
http://www.bravenewlife.com/

[EconProf]

UCGal, that is a good blog site too, especially where it challenges us to rethink everything. I once had high hopes that this deep recession we are now (barely) coming out of would force a lot more introspection and spending retrenchment than we are witnessing. Looking at the way people spend, it seems shoppers are about as intoxicated with consumerism as ever.

[briansd1]

I agree UCGal.
I could do veggie garden. And cooking at home. Ive gotten pretty good at making quick simple fresh meals.

I think it’s a good idea to payoff the principal residence.

I can’t live in an RV or a mess though. But I could live in a beautiful Spartan mid century or Bauhaus house or apartment. I like everything well laid out and sparkling clean. I find that people who live cheap tend to be dirty.
Air conditioning is a luxury I enjoy even in San Diego. I love a cool, air conditioned place in the summer.

I do have a problem with the half half splitting down to the dollar. What kind of relationship is that?

I think it helps to have friends and family to share. It’s better for the soul. Sometimes I feel like i live a life of luxury because I can “borrow” my friends and relatives’ lifestyle.

I have a friend who lives on $10,000 per year in Florida because he has no house payment but HOA and property taxes.

Another thing the blogger said; it does cost a lot of money if you like to go to bars and drink.

[scaredyclassic]

you can go out to bars and drink for cheap, but you cannot do them at the same time legally. I recall young people drinking before they hit the bars to economize.

think outside the box unless you’re a cat

[svelte]

I enjoy my job – maybe that’s why I’m not so focused on retiring early or even just plain retiring. If that ever changes where I hate getting up in the morning to go to work, I guess the idea of living cheaply may appeal to me more.

[Ren]

I sometimes imagine living in a 2 bedroom, 1,000sf house near the beach in retirement, but that’s as small as I’d go. I couldn’t and wouldn’t live on $7k. Besides the inability to drive, protein is expensive, and I would shrivel up and float away without large amounts of it.

Maybe $20k if it was just the wife and I.

I don’t think it’s even necessary to live on $7k, though. A single paid-for income property (in addition to your primary residence) will provide you with two or three times that. If my income is actually limited to $7k in retirement, you all have permission to shoot me.

[sdduuuude]

There’s always slab city:

http://piggington.com/ot_to_piggs_who_want_to_live_super_cheap_here039s_your_chance

[UCGal]

[quote=Ren]I sometimes imagine living in a 2 bedroom, 1,000sf house near the beach in retirement, but that’s as small as I’d go. I couldn’t and wouldn’t live on $7k. Besides the inability to drive, protein is expensive, and I would shrivel up and float away without large amounts of it.

Maybe $20k if it was just the wife and I.

I don’t think it’s even necessary to live on $7k, though. A single paid-for income property (in addition to your primary residence) will provide you with two or three times that. If my income is actually limited to $7k in retirement, you all have permission to shoot me.[/quote]

The blogger has $7k per person… He and his wife spend $14k.

So your 20k isn’t that much above that.

[Ren]

I know I’m close, and I could manage to live very cheaply, just not quite that cheaply. His budget doesn’t allow some things that would be requirements for me.

[bearishgurl]

[quote=briansd1]I agree UCGal.
I could do veggie garden. And cooking at home. Ive gotten pretty good at making quick simple fresh meals.

I think it’s a good idea to payoff the principal residence.

I can’t live in an RV or a mess though. But I could live in a beautiful Spartan mid century or Bauhaus house or apartment….[/quote]

I’m with you on this part, brian… It doesn’t have to be “big,” but I need a “built-on-site” home, preferably a SFR with a backyard.

[Ren]

Another thought – I’m a fan of laziness, just not at the expense of happiness or comfort. If you really WANT to live in an RV and ride a bike, more power to you. On the other hand, if you’re making big sacrifices (for the rest of your life) in order to start doing nothing as soon as humanly possible, you might need therapy or meds.

[bearishgurl]

econprof, I don’t know about living on 7K unless you have your own septic/well/solar, land to grow a sizeable garden, your TV/Internet svc rigged, you buy your own cell phone minutes as needed and never travel.

You example on Early Retirement Extreme was living in apt in Chicago. Not only would I NOT want to live in an apt, I HATE high winds and Chicago has about the worst weather in the nation!

I agree with brian that bartering items and services with friends/relatives/clients, using coupons and shopping deeply-discounted food and other necessities, one can live a life slightly above their means … at ANY age.

Of course no one really knows what the future will bring WRT: future utility rates in urban areas. I think I could retire comfortably on $40K per year and still travel by road whenever I wanted to (that is, if I had no mortgage).

Plane tix, rental cars, restaurants and lodging (though lodging often can’t be avoided) add up quickly and are difficult for a lower-income retiree to afford more than a one-week trip per year. I like to travel multiple times per year and know how to do it on the cheap and also receive comped lodging (thru barter and points accumulation).

[EconProf]

Actually, BG, I think his location was in the Bay Area.
Reading his blog, he seems to be peeved at people nit-picking his lifestyle and choices, and challenging his ideas. But he certainly does not advocate this for everyone. He simply claims that we could all do with a lot less status-seeking consumption if we chose to. And I like how he rips advertisers for shaping our values and habits.
The fact is that capitalism has delivered vastly higher living standards for everyone–rich and poor–in the past two generations. A growth rate of GNP per capita of 3% per year means a doubling in 24 years, and 3% was about our average from the 50’s through 2005. In the 1950’s, houses were far smaller, two-car garages were rare, houses had one black-and-white TV, (but not till the mid-fifties), and cars were clunkers that lasted about 100k miles. This is why he suggests if you want to know what you have to change in your life to live on $7000 per year today, ask your grandparents what they did in the 1950’s and 1940’s.

[Author]

Posts