In the past week a coworker of mine asked if I had set up a retirement plan. I answered no and she directed me to a retirement estimator where my husband and I can manage our finances and see our standing for retirement. Ever since I graduated in Business Management from Cornell University, I have just been working and have not really thought about saving money for retirement. Since that time I have been promoted in a restaurant in Los Angeles. I feel blessed to have this great position and be married to an amazing man named Blake.
During my time in college I worked as a server at at a restaurant. After graduating, I was promoted to Supervisor of the dinner restaurant where I picked up bartending skills and learned about beverage management. As the years passed I was able to prove myself loyal and worthy to the company and moved up the ladder until I received an offer back home in Los Angeles. I had been promoted to Assistant Manager of one of the top restaurants in the company at the age of 28. At the time, my husband was working as a Senior Food and Beverage Manager of a L.
A. hotel. It is as if fate brought us to L. A. to work in our dream jobs. Since we both are high in positions at our hotels, we decided not to have any children, so together we bring home about $190,000 annually. With this retirement plan we both average a net income of $41,214, after considering expenses. Between both of our wages and interest we average a joint income of $16,500 a month. My husband and I have decided not to invest in any dividend stocks since their high price would not be beneficial with the amount of expenses we have.
Our total monthly expenses average to about $13,000. Between my husband and I spend a monthly average of $350 on fuel, $200 on State Farm Insurance, $100 on service and $50 on miscellaneous auto expenses. My husband drives a Nissan Altima and I have a Dodge Neon. Luckily, the cars are both paid off since we have had them for a couple years now. We decided to put $100 aside for monthly service such as tune-ups, tire rotation, or oil change. Another $50 is set aside to provide for any extra features, like air fresheners, car washes or detailing.
After adding up our monthly expenses, I am glad that both of the cars are paid off because that could be another headache for us. To continue with the expenses, my husband and I like to keep cash at hand for any incidentals. Between both of us we may spend about $500 cash at places that do not accept credit cards, such as El Cubano which is our favorite mom and pop restaurant. Considering we both attend church weekly, we like to contribute donations of $100 a month. Since we have no children at the moment, we do not have to worry about child care expenses.
For clothing we have set aside $150 for any items we may need. We just purchased an Apple iMac desktop which we are financing for $20 a month. My husband and I are foodies so we enjoy trying new restaurants and discovering unique food in the diverse LA culture. We have set aside $300 for dining out or attending food and wine events. Entertainment is another thing we have a monthly budget of $200 for. This includes movie dates, arcade visits, beach events, and mini golf. Blake and I do not like to just eat out, we also enjoy home cooked meals, so we have budgeted $300 a month for groceries.
The worst part about this is actually going out and doing groceries. Our health expenses take up about $200 a month for any incidentals. I am proud to say that I am a homeowner of a one story home in Los Angeles, California. This is a three bedroom/two bath home with a garage, fabulous kitchen, and decent sized back yard. The location is perfect because it is in the suburbs, so we do not deal with all the heavy traffic and tourists of the Downtown areas. Living here is also great because we are about 15 minutes from work. Our beautiful home was a total of $150,000 with a monthly mortgage of $1300 from Citizen Insurance.
The monthly mortgage is a bit high because it includes the mortgage, flood insurance, real estate taxes, and real estate insurance. Thanks to my parents advice we signed a deal with Citizen Insurance and got this rate that bundles all our home expenses into one price. Blake and I each have our own insurance from our companies where we pay a combined $250 a month. We also added disability insurance in case we ever need it, for a monthly $60. The $200 for the Doctor includes specialist visits as well as general visits. The $120 for medicine is set aside for any prescriptions, my birth control, and multivitamins.
I am very thankful that throughout college I was awarded scholarships that paid for my tuition and books, so I have no outstanding student loan obligations. The only student loan I took out was paid shortly after I graduated since it was a small loan. My husband and I own a Maltese dog named Coco that we spend about $400 a month on; this covers his food, grooming, and vet visits. We have not forgotten about our personal grooming so we set a monthly $160 for both of us. This means I can get my hair and nails done at least once a month, as well as Blake.
We have separated $100 for recreation for our involvement in the Co-Ed LA Soccer team. This is just a form of us staying in shape while we have fun playing our favorite sport. The $100 includes our uniforms and our membership in the team. Continuing on our expenses are the utilities where we spend $200 on our Verizon Wireless bill, $50 on the landline at home, and $10 for long distance calling to our families out of the country. Electricity takes up $100, gas $20, water $55, sewer $50, and internet $30. Since we live in Florida, we do not have to worry about paying any state or local taxes.
However, considering the income bracket that we are in, we do have a 28% federal tax rate to consider. The final expense area on the retirement plan is my favorite, vacation planning. Since we both work at major hotel companies, we do not have to worry about paying high prices for lodging. We are able to find great team member rates wherever we stay at. For travel we set aside $500 that may include our transportation to the location we may travel to. Another $600 accounts for miscellaneous spending on souvenirs, resort amenities, and activities.
These results were all based on our current annual income and spending. I plan to retire at the age of 67, while my husband is aiming for 65. In order to make this come true, we need to save about $26,000 a year. This should be simple if we achieve any other promotions at work. I plan on succeeding to becoming a General Manager by the time that I am 40 years old. With the help of a few online financial sites and my parents I was able to complete this sheet. I am content with the results of the retirement plan and see it as a beneficial tool to anyone who wants to plan and be ready for their future.