Since I have no exciting travels to share with you this week I thought it was time I wrote something practical. We read hundreds of blogs from full time RVers when we were planning our escape and got tons of useful advice. I appreciated them sharing their unique knowledge so I’ll try to write a blog every now and then that focuses on providing information that you might find helpful if you are planning your own full time adventure.
The question I get most from people we meet on the road that learn we are retired at the ages of 45 and 55 is something to the tune of “wow, are you rich?” Far from it! The runner up questions are generally about how much it costs to maintain this lifestyle. So I thought I’d address finances. How we got here and what it costs to stay on the road.
Jim had a career in construction and eventually ran a successful commercial construction company for about 15 years. I worked in the mortgage industry for many years and was able to join him full time at his company for the last 10 years. But what really allowed us the freedom to retire early were our investments in real estate. Over about 20 years we managed to collect 10 income producing properties and then we worked hard to pay them off. We live solely on this rental income and need to do so until we reach ages that we can hopefully collect some social security and safely withdraw money from our retirement funds. We hope these sources and rising rents will offset inflation as the years pass.
A primary factor in our ability to live off this income is our willingness to lower our expectations of what our retirement would be like and live a modest lifestyle. We have a strict budget and if we exceed what we have budgeted in one category we have to make it up in another category.
One major adjustment we made was our decision to forgo keeping a home somewhere for our exclusive use. We may have a sticks and bricks home again someday but for the foreseeable future our only residence is our fifth wheel.
So how much will it cost for you to live on the road full time? That depends on your unique circumstances. I kept track of every single expense we had for several years in order to set a budget I felt we could work within. Now that we have been on the road for 6 months I have a pretty good idea how we are doing. These are the categories in my budget and some info you might be able to use if you are trying to make your own.
Groceries I have found our food budget has not changed one iota since we retired. I thought I might be able to save money in this category but that has not been the case thus far. It doesn’t matter exactly what I have budgeted for this. If you are making your own budget then base it on what you have been spending unless you plan to eat out more, which we are careful not to do. I also group every miscellaneous item into this category: shampoo, toilet paper, etc. Pretty much any small expense that doesn’t fit anywhere in the budget gets lumped in here.
Lot Rent I budget $600 per month for campground fees, approximately $20 per night. If I splurge on a nice campground then we have to boondock at a free campsite to make up for it. You could easily spend twice this amount, especially if your rig is not set up with solar and/or generators.
Firewood/Propane I originally budgeted $50 for firewood and propane. I had no idea how much we would need when we started so I took a stab in the dark but now I am raising the amount in this budget item. We averaged $75 per month during our first 5 months on the road and only about 15% of that was firewood. The firewood is a luxury but propane is a necessity especially when we boondock.
Fuel I budget $400 a month for fuel. Honestly we have gone over most months. We’ve averaged $550 a month during the 5 months we were really on the go so I’ve made up for it in other categories.
Entertainment/Fishing Movie rentals, Itunes charges, park entrance fees; I lump all these in to entertainment. I started with a budget of $50. We were very frugal and still managed to average $100 per month so I raised it. If you have an avid fisherman in your midst it should be noted that out of state fishing license are very expensive. Jim spent $300 in 6 months on licenses in 5 states. I have this $50 per month in a separate category.
Laundry I didn’t know what this would run me so I have kept careful track of how much doing laundry in laundromats has cost us and it has averaged $22 per month. I usually use the campground laundry facilities. They are generally half as expensive as the commercial laundromats but the machines aren’t maintained as well.
Medical/dental/eye care/prescriptions These items aren’t likely to change much on the road.
Health insurance Again, very individual. We spend almost 25% of our budget on health insurance to keep our old plan. When I shopped for health insurance last fall I couldn’t find another plan that was not tied to care in our home state. If I get sick I don’t want to be required to return to Missouri for treatment or follow up care after an emergency. I am optimistic that I can find another solution and am even considering changing my state of residency for the primary purpose of finding a plan in a state I might be willing to spend time in if one of us became ill.
Auto/trailer insurance We have both ours insured with Good Sam for $100 per month.
Auto/trailer maintenance I budgeted $50 per month for this which has only covered our oil changes during the last 6 months. I know I need to devote more funds to this category but don’t really have enough history to determine how much yet. I’m thinking I will have to at least triple it.
Property and income taxes In Missouri we have property taxes on the truck and trailer. This also is one area I might save money if I change my domicile. But for now I know what they will be this December. Then there are those pesky income taxes. I’ve got a good idea how much I will owe the IRS.
Life insurance, cell phones, and clothing are the remaining categories in my budget. These items are very individual to your circumstance but easy to put a number to.
I don’t have any money budgeted for gifts or vacations. I charge everything I can to a credit card that pays from 1-5% cash back depending on the category. I then use that cash back to cover graduation, wedding, baby, birthday, and Christmas gifts. You may wonder why we would ever need a vacation from our luxurious lifestyle, lol. We don’t. And that is why it is not a priority in our budget. We don’t need vacations but when we do want to splurge on a trip that takes us off the mainland we will have to save some money, possibly by boondocking more, or make some money, by workamping or picking up a short term job.