Looking After the Pennies

I am now through two entire weeks of being retired from paid employment. I always add the "paid employment," even to my PCP yesterday, because I continue to give my time and passion to the Legal Clinic. (But that is different, and not merely because it is unpaid work.)

And now that I am two weeks into this new experience, and now that the dust (well, some of it) has cleared, I am ready to look more closely at my finances for 2022. 

I am not drawing yet social security for two reasons. The first is that I am not yet at my birth year's full retirement age (FRA) of 66 years and four months, which I will hit later this year. The second is that, given my overarching health situation and some other dynamics in this household (age and earnings over lifetime), when I die Warren can elect to take my benefit, which exceeds his. If I delay taking mine and he waits to switch to mine, he will get the boost of my age 70 social security payment. The gray area is between my FRA and that mystical age 70 boundary. If my need for income increases, I will likely apply to start receiving my payments. That is a bridge down the road that honestly I may never get to, not because I am flush with dollars, but because I am realistic about my longevity. 

So, what am I doing for income in the meantime?

Because my last decade of work was as a county employee, I paid into our Ohio public employees retirement system (PERS) and not into social security. As a result, I have a small monthly pension that just started this month. How small? About one-third of my monthly take home while still a paid employee. That amount will increase slightly when an even smaller amount, the result of my (very) limited time as a school employee way back when while managing the middle school Destination Imagination program, transfers over to PERS, but trust me, we're not talking huge sums here.

But here's the sweet spot. The income hit is, at least for now, negligible. Having spent some time recently scrabbling through my expenses and spending for the past two years, I know I can make it. 

Can make it? I think I can still save on the reduced income. 

Part of the reason has nothing to do with my personal habits. I was privileged beyond privileged to have clients long ago, a husband and wife, whose deaths (one long ago, one last year) resulted in some unexpected money coming to me: one as a gift, the other earned winding down a trust. The former went into a separate account; the latter was large enough to pay for a major insurance premium for all of 2022. 

So that was a gift, no matter how you look at it.

The other reason I can make it on the greatly reduced income has to do with my own spending habits (and indeed, the habits of this household). As I have often noted, usually poking fun at myself, I don't shop. I don't go to stores, I don't buy online. The Covid shutdowns only underscored and intensified that habit. My personal purchases since March 2020? Ummmmm...less than $75.00? I don't even buy books anymore (but did save $3500+ by checking out all my reading at the library; our checkout receipts totals the amount you save by using the library). I did buy a new pair of walking shoes ("tennis shoes," folks) because I walk so much I had worn through my last pair. I think they came out to $36.00 or so, on a markdown of a markdown.

On the "eating out" front, realize Warren and I did not eat out a lot even before Covid. Covid only intensified that habit. For safety reasons, I cannot eat in a restaurant, period. We've done takeout, we think, maybe five times since March 2020, not counting when we have traveled to Mayo or when we traveled this summer to see my family. (For the record, we only did takeout, if even that, those times as well.) With Omicron variant cases surging off the charts and my oncologists and PCP saying, "you need to be extra careful again, still, always," I'm not going to change in that regard either. 

Heck, I don't even own a car anymore. Once I knew that I was retiring in 2021 and would not be returning to the schools in person before I retired, I no longer needed a car. My dad needed something more reliable; I gifted it to him midyear last year. No more gasoline, no oil changes, and our car insurance dropped. 

So with all those non-expenses, I was able to save a large portion of my biweekly paycheck. Enough that all of my health insurance premiums (Medicare Part B, Medicare Supplemental Plan G, drug Plan D, my dentist's in-house plan, and a vision plan through PERS) are set aside for all of 2022. 

Taking all that into account, my pension check will pay the monthly household bills that I am responsible for (we do not have shared bank accounts in this home) and my share of the groceries (the same), and I will still have money left in my checking account.

For someone who went through a full bankruptcy in 2005 because of the fallout from my cancer diagnosis, and then who lived paycheck to paycheck (and sometimes not even that) for a long, long, long time after, that means a lot. I look back at old posts and see where I was trying, dime to dime, to get even, let alone get ahead. It wasn't that long ago.

The biggest unknown heading into 2022 is the cost of groceries. I kept track of our grocery spending through 2021. Food: $2131.73. Household items such as detergent, toilet paper, trash bags: $201.05. Combined total: $2332.78. Monthly average: $194.40. That was higher than I had hoped for the year (and yes, food costs have risen) but lower than I had feared. Our goal for 2022? Come in under $200.00/month again. 

Found money, 2021

And one last thing. Along with the Non-Consumer Advocate and others, we drop any money found in the parking lots, sidewalks, and such into a container for the year, then see what we have December 31. 2021's haul? A whopping $1.39. (Clearly people aren't carrying as much money as they used to; I know I don't.)

Maybe this is a longwinded way of saying I'm okay and, indeed, this household is okay on the financial front. That is a huge privilege. And a huge relief. 

I am still working on my 2022 financial goals, which is different from budgeting. What do I need to accomplish financially this year? What do I want to accomplish? And how do I pay for it? 

Time will tell. And in the meantime, I will continue to keep an eye on those pennies.