Posts tagged with "expenses"


  • Changes To Extraordinary Items Reporting

    Recently I made some changes to how I report my extraordinary items. These items could be expenses or income. An extraordinary item is an unusual expense or income that is not accounted for in budget. Generally, I have planned expenses and have a budget for them, but in some rare cases, I had either unexpected income or expense that was not planned. Earlier, I used to consider all extraordinary income as growth in corpus and all extraordinary expenses as growth in expenses. But lately I have changed the reporting. Now, both extraordinary expense and income are considered as growth or drop in corpus. I applied the changes retroactively to all old expenses too. Read on to understand why I made this change.

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  • Year In Review - 2023 Annual Expenses

    In the previous post I wrote about my monthly expenses. This is the continuation of that post and I will be covering my annual expenses in 2023. While monthly expenses are those kind of expenses that occur more frequently, yearly expenses occur rarely, perhaps once every few years like house repairs or buying a new car etc. I will explain where we are spending the most and why. Remember that for all the expenses, whether monthly or annual, the money is coming out of my retirement corpus which consists of a bunch of debt and equity mutual funds. There are no other incomes or special savings for annual expenses. Last year’s annual expenses were low because thankfully we did not have any big ticket item like buying a car.

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  • Year In Review - 2023 Monthly Expenses

    It is about time I reviewed my monthly expenses for the past year. I do this activity at the start of every year. There are two kinds of expenses I track. One is monthly expenses which sort of appear most months like food expenses, internet etc. Then there are those expenses that occur once a year or once every few years. Those are considered as annual expenses. In today’s post I will go over the monthly expenses of last year and how it compares with the budget I made at the start of 2023. Lets also look at inflation since my retirement. Later in the post I will inflate my monthly expenses and set a budget for 2024. Lets dig in then.

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  • Solar System Comparison with MKBHD

    Some of you may already know MKBHD, a popular youtuber in the tech world. He recently posted a video about the going completely solar and not having to pay an electricity bill for a whole year. It is a very well made video which explains how the solar panel system works with batteries (off grid) and with net metering (on grid). Although I don’t have net metering and I am not completely off grid, so mine is a hybrid approach. Still, if you watch the video it will help you understand how my setup works (sort of). My setup is closer to the hybrid system explained in another video. Anyway, I wanted to compare my puny setup with MKBHD’s setup and see how I compare. So here goes.

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  • Watch The Lifestyle Creep

    Have you ever though about why your expenses keep going up year after year? Perhaps you say your expenses haven’t increased that much since last year. But if you compare your expenses today with expenses some 10 years ago, you will see a huge difference. Why is that? Well you can attribute it to inflation. However, that is not the only culprit. The other culprit is lifestyle creep. And because it creeps in so slowly you can be forgiven for not recognizing it. If you don’t watch the lifestyle creep, you are in for a surprise when you do your retirement planning.

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  • Where Are The Expenses?

    When I write or talk about our expenses post retirement, many people want to know how I decide which expenses go into which category. Remember, I keep a record of all our expenses and categorize them. I bundle them into monthly and annual expenses. What some people have noticed is the absence of certain categories like spending on eating out or for buying clothes or shoes etc. So I thought I’d do a quick post on where those missing expenses go so there is no confusion. First lets check the categories I have for monthly expenses –

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  • Should You Sell Debt Or Equity For Retirement Expenses

    After reading my post on “withdrawal plan in retirement”, one reader asked why I suggested that one should sell debt mutual funds to handle the retirement expenses. In that post I gave an example where an investor has only debt and equity mutual funds and in that scenario, it is preferable to sell debt mutual funds to handle everyday expenses and then do a rebalance once in a while to get the asset allocation to the ratio that you prefer. The reason for this recommendation is quite simple. It is to avoid selling mutual fund units of an asset class at their low point. Since equity mutual funds go up and down quite a bit in value, it is possible that in some years you might sell at a low point and dent your compounding effect. I will explain how with an example.

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  • Withdrawal Plan In Retirement

    After my post on lumpsum vs SIP investment, a reader asked – “Wanted to understand the other side - how to redeem from our funds after we retire? Say we have calculated the number and we have enough. But, the challenge is how to get to a withdrawal mode from accumulation mode. You have showcased how you do it in some articles but can you do it with some numbers for a fictitious person? Ex: Age 40. Amount 6Cr spread across multiple equity and debt funds and US Stocks. Now, how to withdraw to last till their age of 85 for an expense of 1L per month (corpus is 50 times)?”. I thought it is an interesting question that needs answering. I will go with the numbers given by the reader and work out an example in this post.

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  • Year In Review - 2022 Annual Expenses

    In the previous post I wrote about my monthly expenses. This is the continuation of that post and I will be covering my annual expenses in 2022. While monthly expenses are those kind of expenses that occur more frequently, yearly expenses occur rarely, perhaps once every few years like house repairs or buying a new car etc. I will explain where we are spending the most and why. Remember that for all the expenses, whether monthly or annual, the money is coming out of my retirement corpus which consists of a bunch of debt and equity mutual funds. There are no other incomes or special savings for annual expenses. Every year since retirement we have seen different kinds of expenses and last year wasn’t any different either.

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  • Year In Review - 2022 Monthly Expenses

    You already know about the two kinds of expenses that I track – monthly and annual expenses. You probably also know that I publish my expense report for the past year and mull over it a bit. Then I create a new budget for the expenses for current year. Following the tradition, here is a post about my monthly expenses in 2022 and the budget for 2023.

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