OK - I gotta admit, I do keep an annual personal asset sheet (that I was urged to do from a fairly young age), for my own information, but I don't typically keep an annual expenses sheet. The asset sheet is easy....just take the year end figures on statements (and such) and plug them into a spreadsheet. However, I found that I really can't truly gauge my true financial situation without having both income and expense figures. My philosophy has always been, if I don't have the cash for it, then I can't afford it, and I don't purchase it. With that philosophy (and the blessing of being healthy and fortunate), it has kept me from spending money I don't have, so there was never any need for an expense sheet. However, as I get closer to retirement, I can see the value of having both figures. Today I sat down and tried to figure out what we currently spend in a year. I'm finding it's difficult, since we use cash quite often. I'm pretty much left with what I can track in the checkbook and CC's. I know some of our expenses will drop upon retirement and others will increase. So, having a baseline of expenses will be beneficial and I really should try and do this every year to get a better gauge of where I stand on what I spend. Here's a list of what I've come up with: Utilities Credit Cards (includes both wants/needs/entertainment/unnecessary splurges) Property Taxes Phone/TV/internet Life ins. Car/home/disability ins. Health ins - don't pay now, but will in retirement LTC ins - don't currently have, but will in retirement Pet expenses - vet bills/food/boarding/meds Any loans (including mortgage & interest) if applicable It's those expenses that aren't regular that are throwing me off like house repairs, medical/dental OOP expenses, vacations, unexpected vehicle expenses, etc. Those can be BIG ticket items that make a huge difference in any budget. For example, we had to replace our furnace last year......thousands of dollars, but should be good to go for 20 more years. In addition, it's tough to determine food/clothes/gifts/gas/household items/splurges, etc. b/c those are usually paid by CC or in cash. I would imagine those expenses will vary greatly from year to year. I also have a tendency to buy in bulk on all items, so that's an issue as well. I might have a big expense one year and nothing for several years afterward. I have learned one thing for sure in doing this.....It's much easier determining your actual income than it is to determine your actual expenses! I'm very fortunate that it's not an issue for me so I doubt I'll keep close track of my cash payments (like I probably should).....but from now on, I will be keeping track annually of both personal worth and also personal annual expenses (within reason). It is apparent that keeping the expense number (as close as possible) from year to year will be a valuable number to have for future reference. It's kinda hard to determine when I can actually comfortably retire without knowing how much I spend at present. The big unknowns that I am facing are health insurance/med expenses and whether or not SS is going to be there for me (which I have not planned on receiving). LTC is also a concern as that insurance is more expensive the older one gets. For those who have retired, have you done this exercise? If so, what errors did you make that you wish you wouldn't have made? Any advice for someone looking to retire? I can't wait to read the discussion on this thread!