Where to Next — That I Can Afford?

Could have read the basics about cost of travel in Italy before writing the last post. But the whim said ‘Italy’ and my Id took the bait. I’m glad it did. I’ve had enough of too much planning.

Italy is more expensive than I had imagined, as in 2 times more. Need to research some more about how those costs drop when one gets off the tourist trail. If they don’t drop much then decide if that matters.

(Five minute break here. One minute to locate a document, read the spreadsheet and it’s graph, then make decision. Four minutes to remove one of the lines from the graph so I could post it without revealing too much.)

It’s affordable. Lonely Planet’s estimate for the top end of their ‘mid range’ budget is around my ‘you could be spending this’ number. Spending will probably be different than Joe Random Tourist (less on high speed transport, alcohol, tourist center lodging, tourist center admissions, more on food and motorbike rental) but it’s close enough for decision making.

Prior to retirement my financial planning was all about not running out of money before running out of days. Secondary objective was to not run out of the taxable account funds before hitting 59.5 years. Intentionally made conservative assumptions whenever possible. Retiring into the maw of the global economic shit storm played a part in that, but it was mostly about my life long money habits.

How conservative were those estimates? Green line in the graph below is my actual running average spending per day since retiring. Because I’ve spent less than I could afford, the amount I can afford keeps increasing. That’s the red line. As each quarter ends and I update this graph it becomes more apparent that line should be labeled ‘What Haven’t You Done Because You Thought It Was Too Expensive?’ I may find reasons not to go to Italy, but it will not be because it was too expensive – assuming costs and exchange rate this May are reasonably in line with today’s.

Need to swap colors in the source graph. Don’t want the color of a stop sign associated with what I could be doing.

Between 10% and 20% of the taxable account has been in equities. Their rebound since retiring, combined with a wash sale, has as much to do with the difference between green and red lines as my spending habits. Moved some funds from bonds into stocks when the market was way down, which means either I got lucky or timed the market right. Luck seems like the obvious choice.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: