Early retirees talk about the pleasure & independence that comes with walking away from the workplace and living their lives to the fullest. At the same time, they also talk about the shift in mindset that comes from no longer actively accumulating their savings, but continuing to actively spend it.
One opportunity to spend less comes from the costs that are solely work-related. For me those expenses fall in two key categories: lunches at work and dry cleaning bills. I recently went on Mint.com, where I track our spending to see how much these expenses add up to annually.
Work lunches are highly variable in cost because sometimes I eat in the Megacorp cafeteria (or bring food back to my desk), or I go out to eat with friends from work (about 1x per week). For the purposes of this analysis, I averaged the cost of a meal in the cafeteria ($7.80) times 48 weeks x 4 days = $1500 annual savings. Eating at home isn’t free, so I need to net that cost out. Oftentimes I just have a peanut butter sandwich, a bowl of soup, or a frozen microwave meal. I would place the price of an at-home meal at about $3.00, so that reduces my lunch savings to about $1000 each year (rough numbers).
Dry cleaning is more expensive. I see from Mint.com that we average $97/month at our local cleaners (despite our 20% loyal customer discount). Most of that is work-related, and little will continue when I’m not working at Megacorp. I’ll expect that we will save about $1100 year on dry cleaning.
I can’t think of anything else that is a strictly work-related expense for me. Mileage to and from work could be considered work-related, but I live within 10 miles of Megacorp and expect that I will easily drive that much each day when I’m retired just out bumming around. Similarly, I don’t expect that I will go to coffee shops any less often. I’m not a huge coffee drinker — but I do like to hang out there, have a Coke, and work on my laptop from time to time.
Still, saving $2100 a year on work lunches and dry cleaning is a good amount of fun money (about $40/week) that’s not tracked in any of my estimates. With today’s interest rates, you would have to have a whopping $200K in a CD for a year to make that much.m
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